Finance and Government Services — Issue No. 44 — Thursday, October 2, 2014 (HTML)

Beaufort Room, The Westerly Hotel and Convention Centre
1590 Cliffe Avenue, Courtenay, B.C.

Present: Dan Ashton, MLA (Chair); Carole James, MLA (Deputy Chair); Eric Foster, MLA; Simon Gibson, MLA; Wm. Scott Hamilton, MLA; George Heyman, MLA; Gary Holman, MLA; Mike Morris, MLA; Jane Jae Kyung Shin, MLA; John Yap, MLA

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

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


CONTENTS
Page
Presentations	1085
D. Hoogland
M. Petter
J. Bowman
A. Gower
D. Hawkins
D. Cooper
S. Aldous
R. Bealing
M. McLachlan
S. McCarthy
P. Barbosa
F. Muzin
C. Perkins
C. Campbell
R. Botterell

D. Ashton (Chair): Well, good morning. Thank you very much for coming this morning. My name is Dan Ashton. I'm the MLA for Penticton and Chair of this committee. It's the Select Standing Committee on Finance and Government Services. We're an all-party parliamentary committee of the Legislative Assembly with a mandate to hold provincewide public consultations on the next provincial budget.

The consultations are based on the budget consultation paper that is released by the Minister of Finance. Following the consultations, the committee will release a report with recommendations for the budget for 2015 no later than November 15, 2014.

This year we are holding 16 public hearings in communities across the province. A video conference session is also scheduled for October 8 to hear from four additional communities — Dawson Creek, Quesnel, Smithers and Castlegar. This week we've been in Cranbrook, Kelowna, Kamloops, Williams Lake, Campbell River and now Courtenay.

In addition to the hearings, the committee is accepting written, audio and video submissions and responses to a very short on-line survey. You can make a submission or learn more by visiting our webpage at www.leg.bc.ca/budgetconsultations. You can also follow us on Facebook and Twitter.

We invite all British Columbians to take time to make a submission and participate in this important process. All public input is carefully considered as part of the committee's final report to the Legislative Assembly. The deadline for submissions is Friday, October 17, 2014.

Today's meeting will consist of presentations from registered witnesses. Each presenter will have ten minutes to speak, followed by five minutes for questions from the committee. Time permitting, we will have an open-mike period at the end of the meeting where five minutes is allotted for each presenter. If you wish to speak, please register at the information table.

Today's meeting is being recorded and transcribed by Hansard Services. A complete transcript of the proceedings will be posted to the committee's website. All of the meetings are also broadcast live via our website.

J. Shin: Good morning. My name is Jane Shin. I'm the MLA for Burnaby-Lougheed and the deputy spokesperson for trade, immigration and multiculturalism.

G. Holman: Good morning. Gary Holman, MLA for Saanich North and the Islands and spokesperson for democratic reform.

G. Heyman: George Heyman, MLA for Vancouver-Fairview, spokesperson for technology, green economy and film and television.

C. James (Deputy Chair): Carole James, MLA for Victoria–Beacon Hill and Finance critic.

D. Ashton (Chair): Also assisting the committee are Susan Sourial and Sarah Griffiths from the parliamentary committees office, along with Ian Battle and Jean Medland over here with Hansard. These four individuals are the backbone of these committees that allow us to get out into the province.

Welcome. First up is Lifelong Learning. Thank you very much for coming today. As you heard, ten minutes for the presentation. I'll give you a two-minute warning. We do keep the time right tight.

D. Hoogland: Okay. Well, welcome to the Comox Valley. My name is Danielle Hoogland, and I am the Comox Valley literacy outreach coordinator and an employee of Comox Valley Lifelong Learning Association, the organization that is supported by Decoda Literacy Solutions to lead our community literacy planning process.

I'm joined by Martin Petter. He is the president and chair of the Comox Valley Lifelong Learning Association.

First, I would like to thank you for the invitation to speak to you. I respect the work of the select standing committee and the democratic process used to listen to the concerns and priorities of communities across British Columbia.

Last year my colleagues and I made a presentation to you regarding the funding of literacy coordination across British Columbia. This committee made the recommendation for annual funding of $2.5 million for community-based literacy work. Thank you for that recommendation.

The Ministry of Education did provide $2 million at
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the end of the 2013-14 fiscal year. Although it is less funding than required, it has sustained literacy coordination in our community, which in turn sustains literacy programming, initiatives, workshops and activities.

The funding that our community receives through Decoda Literacy Solutions — and for the 2013-14 fiscal year, that was about $27,000 — is leveraged threefold through the generous support of community partners, service clubs and other funders. In other words, the minimal amount of coordination funding that is received is multiplied three times through proposal writing, the soliciting of in-kind support from partner organizations, the recruitment and coordination of volunteers, fundraising and through the organizing and coordinating of literacy campaigns such as Raise-a-Reader.

We can demonstrate that the $27,000 that our community receives turns into $75,000 of both actual additional funding and in-kind support. You cannot deny that this is a great rate of return on your investment in community-based literacy. Unfortunately, there is no funding committed for the 2014-2015 fiscal year and beyond. Our work continues to be unstable and uncertain.

Last year I spoke to you about how our funding reaches families, children, immigrants, young adults and seniors. I spoke to you about a young mother who was breaking a generational cycle of poverty and unemployment because she now has the confidence and community support to invest in herself by pursuing further education. I spoke to you about an immigrant mother who launched her own catering company and who continues to improve her writing skills to better market her company.

This year I would like to tell you about myself and how my role as a literacy outreach coordinator not only benefits my life but benefits my community.

I was contracted in January 2008 to research and write the Comox Valley community literacy plan. Seven years later, I am still employed to facilitate and coordinate literacy planning and implementation. Each June, when my board of directors review their budget for the following school year, I'm both surprised and relieved that there is still enough money in the bank to support my role in community.

My role extends beyond coordinating programs, events and activities. I attend multiple community interagency meetings, including early childhood development and social planning and meetings focused on our youth, our aboriginal community and our immigrant population. I speak to many groups about the importance of community-based literacy, including community health providers, parent-student service clubs, our municipal government, teachers and school administrators.

I work with our local employment centre to create essential skills and employment readiness programs to those who are seeking both skills and employment. I worked with Decoda Literacy Solutions, employers, educators, unions and others to develop A British Columbia Workforce Literacy and Essential Skills Plan, a plan that supports the B.C. jobs plan.

As an advocate for literacy, I connect the issue of literacy and essential skills to other social, cultural and economic challenges. I seek partners to join in order to find joined-up solutions to our joined-up challenges. Together we are addressing homelessness and poverty, food security, health, employment, child development and education.

When I began my role as an LOC, a literacy outreach coordinator, I had a degree in biochemistry. I now have a graduate degree in adult education and community development. My knowledge, skills and experience add immeasurable value to my work in community. I am paid 20 hours a week to coordinate literacy in my community. I work over 40 hours a week to support my community's well-being through volunteerism and advocacy.

The funds that you commit to literacy outreach coordination are leveraged through literacy outreach coordinators themselves. Coordinators extend their part-time paid roles into all facets of their lives. But it isn't selfless work. We love where we live and are committed to making our communities better places. Personally, I'm proud to do such important and meaningful work. However, if I lose my job, I will lose the time and opportunity to connect with others to address the literacy needs of my community. I will lose the time, because like everyone else, I do need a job.

We are here to ask that you continue to provide the minimum amount of funding required for the coordination of literacy work — $2.5 million for the province.

As I hope that you have heard, these funds are leveraged by communities and by literacy outreach coordinators themselves. The return for your investment is unquantifiable. The benefits are so far-reaching. This funding makes a difference in people's lives, to my life, and it builds stronger communities. The Comox Valley is a testament to that.

C. James (Deputy Chair): Thank you for your presentation. One of the real strengths that we've heard around the province around literacy programs is the ability for the programs to meet the unique needs of the community — some commonalities but some that are very specific to the community.

I wonder if you could tell us a little bit about the growing needs that you see. Are there areas that you really see pressures in or areas that are growing in your community, when it comes to your literacy work?
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D. Hoogland: In our community we have two focuses that we've determined after a needs assessment. One is young adults who are transitioning into post-secondary education, into adulthood and into the labour market. We're really trying to support these young people through essential skills programming and working very closely with our Work B.C. employment office to get them ready for the labour market — employment readiness programs, labour market research. What do they need? We match them with employers in our community for them to actually have that firsthand informal exchange of the skills and education they might need to go into that sector.

The other area in our community is hard-to-reach families. These are families that live in pockets in our community that don't access other community supports, necessarily, for various reasons. Often we have young single mothers. That is one growing need. Often they are young single aboriginal mothers with three children. They are unemployed. We are actually creating programs in those neighbourhoods serving those women and, in some cases, fathers — hard-to-reach families.

We're really trying to invest in parents, because they, in turn, of course…. We're investing in their children.

S. Gibson: It's been my experience in working with university students that often the people that most need the help don't come forward. You kind of alluded to that in your closing comments a moment ago. There are a lot of folks out there that are, basically, at the low end of the literacy chain. They're struggling, but it's embarrassing when they get to be in their middle years.

How do you find those people? How do you discern them? Those are the ones that are embarrassed. They feel awkward about coming forward and saying, "I don't even know what a topic sentence is," or whatever.

D. Hoogland: A few ways. We connect with a lot of interagency meetings and just talk with our colleagues in the community about where those people are, where and how to access them.

We lure a lot of people with food, to be honest. Actually, in all of our programs, we have food. It's amazing how people come for a good, healthy, simple meal. We work with one of our local food security organizations, LUSH Valley, and they do a meal preparation, but it's all hands-on. The hard-to-reach families in the program I was just talking about come for that meal, and then they realize: "Wow." They are introduced to an upgrading instructor from North Island College or to an essential skills counsellor from the Job Shop, and then it kind of proceeds forward.

Same with young adults. I mean, pizza is a huge incentive to get people through your doors.

S. Gibson: What about boys? That's a huge issue today. My wife was an elementary school teacher for many years, and the classic problem is that the girls do better and the boys are often left behind. Indeed, this is, in many ways, why young women are taking over virtually every university program. I think part of it is the literacy factor. What do you say about that?

D. Hoogland: In that way, we're working with our schools themselves, particularly with the elementary schools, and looking at ways how we in community can support the boys — because you're absolutely right; we're finding that as well — at those schools. We do a lot of book distributions. We want to ensure that there are relevant books that we are distributing to those boys. They don't want pink fairy books at all.

So relevancy, really talking to the teachers who work with those children, and then, as community, supporting after-school programming, home reading, that sort of thing.

G. Holman: Just quickly…. Thanks very much for your presentation. I really don't have any questions because we've heard your message repeatedly throughout the province last year and this year. As Carole says, each community has its own specific needs, and it's really amazing how you adjust to each community and how you weave in with all of the other social agencies and community groups. So thank you for your work.

I suspect I speak on behalf of a few committee members. The reason I'm not asking questions is because you've made your case very loud and clear.

You made a comment about preparing young people for the job market and whatnot. Is there a deficit in our school system, perhaps? Why is this need out there to prepare young folks for the workforce? You know, they've left high school. They're going into post-secondary, or they're going into the workforce, job training or whatever. Just explain that a little bit clearer for me so I understand where that need is or why it's there.
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D. Hoogland: It's a big question. What I see that works for the young people who we work with is the experiential, the hands-on learning, particularly connecting with people in certain sectors. We have mentorship programs, for example, where the young people who have struggled in the school system, for whatever reason, actually get to have a conversation with the manager of the bank or with people who work up at Mt. Washington, our ski resort.

A deficit in the school system. I don't think I'm going to go there — but definitely getting some hands-on learning, engaging community. We're here. We really want to support these young people in our community, but we need to be at the table, too, and we can do a really good job of it.

M. Petter: Okay. The key thing is building trust. A lot of these kids are really disillusioned, and we have to try and find ways of approaching them which don't make them feel as if somehow they've failed already. So we won't go and say: "You have a literacy problem." We'll say, "We've got some essential skills that you may find useful when you go for your job interview," and the literacy kind of comes along with it.

That's why the community-based approach is so significant because you've got to have people who are part of the community, who understand the community and who are there for the longer term.

Up next we have North Island College — John Bowman. Mr. Bowman, welcome. Thank you very much for coming today. We have ten minutes for the presentation. I'll give you a two-minute warning if it looks like you're going to be close to the ten. We have five minutes for questions and comments, and as you can see, we do ask lots. Sir, please proceed.

J. Bowman: My name is John Bowman. I'm president of North Island College. First of all, I want to thank the committee for making this opportunity available.

I'd like to share some comments with you in each of three areas very quickly. First, to provide some background on what is truly a great little institution, a gem of a community college that we have here on the north Island, NIC. Secondly, I'd like to highlight some of the unique fiscal and operational challenges that are experienced not only by NIC but by, in particular, the six smaller rural community colleges.

Lastly, I'm going to offer a few recommendations that I hope the committee will consider for inclusion in your report.

First, geography is such a significant factor to rural British Columbia, particularly to the rural college institutions. We serve six school districts in our region, comprising two-thirds of the land mass of Vancouver Island as well as a significant portion of the mainland coast. North Island College serves a regional population of 160,000 citizens, which makes us the most populous of the rural college regions. The north Island also is home to 35 First Nations communities, and 12 percent, overall, of our regional population is of aboriginal ancestry.

Unfortunately, high school non-completion rates on the north Island are high, compared to provincial averages. Now, 34 percent of our high school graduates had not completed post-secondary, and 46 percent of the adults 25 to 54 years old within the region had not completed a post-secondary credential, compared to 37 percent for the province as a whole.
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We're proud of the fact that our college offers a comprehensive range of education and training programs — everything from adult basic education through to trades, health care and university studies. Interestingly, the provincial government is very focused on re-engineering post-secondary education and the skills-for-jobs blueprint. I've had a look at the preliminary list of high-demand occupations that are expected to be needed in the province over the next decade, and fully 30 of the top 50 — the first 30, actually, of the top 50 — are already provided by North Island College in this region.

We also are innovative, and we deliver programming in a variety of ways — traditional face-to-face methods, of course, but we also have seven on-line and hybrid programs. We use interactive television, and we deliver programming through learning centres and our campus-based facilities, of course.

We're also very proud…. I think I can truly say that "Partnerships R Us" at North Island College. We have a myriad of arrangements with other post-secondary institutions, which provide pathways for students, including 11 dual and guaranteed-admission agreements enabling students to start at North Island College and go on to complete degrees at many universities.

We work very closely in partnership with First Nations and our smaller, more remote communities. Increasingly, we're bringing the college close to home by delivering programming in community where we don't have permanent facilities.

We often talk about B.C.'s public post-secondary system as a system, and it truly is. But I think it's important to note that we have 11 colleges, 11 universities and three institutes. While our institutions share many things in common, there are also very significant differences that shape the functioning of our colleges and the universities. We obviously vary greatly in size, in programming and in our student-enrolment fiscal capacities. We have differing missions and mandates. Some of us focus more on our regions, and others on the province as a whole.

I think it's important to stress, however, that small colleges face some significant issues and challenges that are not shared by our larger, more urban cousins. We have multiple campuses, typically a combination of permanent, purpose-built facilities and a variety of temporary and leased buildings.

Our smaller populations and lower densities of people do limit the economies of scale that are possible, compared to institutions in our larger cities. However, although the student numbers completing some of our programs may seem small compared to large urban institutions, the relative impact on the health and sustainability of our rural communities is critical to gaining skills for employment and entering the labour markets in their home communities. This is very significant.

Our regions, as I mentioned, are home to large proportions of aboriginal learners and citizens, and they do face some pretty unique and significant hurdles to completing post-secondary education.

Colleges like NIC are currently highly dependent on provincial government funding. Last year 72 percent of our total revenue came from the provincial government through the AVED base grant and through ITA funding. Generally, we also have amongst the lowest tuition rates in our provincial post-secondary system. Tuition revenues typically amount to only 15 percent of our total annual income, which is substantially lower than other institutions — for example, the universities, BCIT and urban colleges, which are in the 30- to 50-percent range.

Now, we are striving to increase and diversify our revenues and to lessen dependence on government funding. However, given the structure of our local and regional economies, this is a challenge, particularly for rural communities.

However, one area where we're having great success is in the growth of international education. This fall we have over 200 students from 30 different countries in the Comox Valley, which is a 47 percent increase over just a year ago.

Now, the main message I want to leave the committee with today is that across-the-board, one-size-fits-all approaches to institutional funding and policy don't work well for rural colleges. In fact, they substantially discriminate against people who live within our rural regions.

Over the past four years it's been necessary for our institution to make adjustments to our budget, to only $2.8 million or 7 percent of total operating revenue, to address budgetary shortfalls resulting from reductions to provincial base funding, unavoidable cost increases, as well as the impacts of self-funded salary and benefit increases that were negotiated under the previous cooperative gains mandate. Now, $2.8 million for an institution of our size, with a $40 million budget, is a huge challenge to address.

The majority of those adjustments have involved reductions to administrative supports and cuts to student services and educational programming, while the balance were achieved thanks to additional revenues that were generated from international education, continuing education and contract training.

As we all know, the current provincial tuition limit policy has been in place for many years. Unfortunately, this policy severely impacts the sustainability of our smaller colleges in particular, which are already the most affordable and accessible institutions from a cost perspective. The affordability of college education is clearly substantiated based on generally lower tuition fees and since most of our students do attend their local colleges and live at home and do not incur the costs associated with moving or living away from home.

Interestingly, I think, many students in the province pay substantially different tuition fees for exactly the same program and curriculum in neighbouring communities. For example, trades-training programs offered here in Courtenay, as compared to Nanaimo, are a bargain.

We do not propose the deregulation of tuition fees or that institutions implement large, across-the-board percentage increases. Rather, I'm calling for a more rational and less simplistic policy that considers programming-related factors, including labour market demand, the current large tuition disparities across communities and regions, and consideration, perhaps, to establishing benchmark tuition rates or bands by major program type.

Once again, I think it's important to stress that one-size-fits-all approaches to policy, to funding, will further disadvantage many British Columbians residing in rural college regions. Their access to college programs and services is already more limited by the lack of fiscal capacity within smaller institutions.

In closing, I would like to propose that in Budget 2015-16 the provincial government consider the distinctive fiscal challenges and operational realities that impact the small rural colleges, particularly in the apportionment of the projected savings that may need to be achieved in the total funding provided to post-secondary institutions. I believe the plan is a $30 million reduction to the base for institutions, approximately a 1.5 percent cut across the board.

Let's develop a funding mechanism to address the substantial inequity and lack of close-to-home access to post-secondary education and skills training that many British Columbians in rural regions currently experience. And lastly, a review and revision to the provincial tuition policy that provides for greater fairness to citizens and for improved sustainability for our small public post-secondary institutions.

J. Shin: Thank you for your presentation. My question goes to the 47 percent increase that you saw in the growth of international student enrolment. I understand that compared to universities in the urban cores — like UBC, BCIT, where there's an established branding internationally to attract students — for our rural colleges the marketing efforts, I would assume, need to be more aggressive. I also understand that there are different recruiting agencies that colleges and universities often have to work with in order to attract students and bring them over.

I was just curious to find out if you could comment a little bit on the commission structure and what kind of a constraint financially that would impose on the international tuition that you bring in to cover the operating costs for those classes as well as to pay out those agencies.

J. Bowman: I don't think the commissions we pay to our agents is a big issue for our program. We're still relatively young in the game, as far as international education. Our program, I think, has only been in existence for about eight to ten years. In the last five years it has really taken off. We have good relationships with agents.

The majority of our students, or the largest proportion, currently come from India, but we do have students from 30 countries around the world. They're attracted to a variety of programs in business, and we're doing a lot of post-diploma programming that's attracting student interest. I don't really think the commissions that we pay to the agents that work for us is an issue in terms of our situation.

J. Shin: Gotcha. I just have one more quick question. Also, deferred maintenance is a huge issue for some of the colleges and universities that I met with in urban cores. I was just wondering if you can comment, if you have the same sort of issue here.

J. Bowman: We certainly do. North Island College, however, has only been operating from permanent campus facilities for about half of our 40 years. We were originally primarily a distance education institution, so happily, our facilities generally are in better shape than many across the province because they're younger. But many of our campuses are reaching that stage where we have to replace roofs, and there's significant work and expense that we're incurring. So investment in facilities is certainly going to be important for us.

J. Yap: Thank you, John. I am curious about the First Nations component. That's a focus for the province. You mentioned that's a significant presence here, the demographics. It's a very youthful demographic and important in the economic future for the region and the province. How is that going for the college?

J. Bowman: It's going very well. We've seen increased enrolments and increased graduation rates over the last five years. The key for us has been bringing programming to learners in their home communities.

First Nations people are very…. Their culture is about the land and relationships that they have with their families, so relocating to attend campus-based programs is a challenge for many with family commitments. We're going to continue to try to work in partnership with First Nations and aboriginal communities to deliver programming in communities that their citizens can access them in.

J. Yap: Are there any programs or trades that seem to lend themselves to or are very sought after by the First Nations learners?

J. Bowman: Well, recently we've been responding to acute demands for health-related programming in communities. We're doing a health care assistant and related programming in Ahousat. Early childhood education is in big demand in First Nations communities where their populations are growing. It's really across the board.

It's more difficult to deliver trades-training programming in smaller communities, given the specialized facilities and equipment requirements, but we're having some success.

G. Holman: Thanks for your presentation. We've been hearing from a number of smaller colleges about their view about inequities in the funding formula, and I was interested in your comment about economies of scale. That kind term doesn't typically occur to people as something that would apply to an educational institution, but of course it would.

Just a simple question about the funding formula. The core grant that you get — you know, per FTE: is that how it works? Do all of the colleges get the same dollar per FTE? For example, you made a comparison to Nanaimo. Just as an example, does Nanaimo get the same dollar per FTE as North Island College, or do the colleges get the same dollar per FTE as the larger institutions?

J. Bowman: That's actually quite a complicated question. The system for funding institutions changed a number of years ago. We used to have something called the program profile process, whereby individual programs…. It was essentially a contract that institutions entered into with the provincial government. So many student seats, FTEs, in a program, and there were specific dollar amounts attached each of those FTEs. That was done away with some years ago when we went to block funding.

At that time, universities were funded at a higher level per FTE, but different programs qualified for different dollar amounts. When that was all rolled together, and
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there haven't really been…. It was all basically funded on growth. You had to demonstrate unmet demand — wait-lists or you were turning students away — in order to secure additional funding.

If you were a small institution like North Island College and you didn't have demand that you could demonstrate by wait-lists or that you were turning students away, you didn't get additional resources. There isn't a base level of funding for each institution.

As I mentioned, our institution serves the largest of the regional populations. Our base grant is 50 percent lower on a per-capita basis compared to the average for rural colleges. I recognize that that's a result of the historical anomalies in the funding system, but the bottom line is that residents of the north Island do not have the same level of access. Our institution does not have the same capacity as, for example, my former institution in Prince George. I'll leave it at that.

D. Ashton (Chair): Please, if you don't mind. Thank you. I apologize. We've gone well over. Just before you leave, John, what's the commission you pay to an agency to get a foreign student, percentage-wise?

J. Bowman: Percentage-wise? I'm not even sure. I think it would be in the 10- to 15-percent range.

Up next we have Comox Valley Chamber of Commerce. Good morning. Thank you very much for coming, Dianne and Andrew. Appreciate it. Ten minutes for the presentation. I'll give you a two-minute warning, and we have five minutes for questions. We literally use every minute, so I'm going to keep you short and sweet on some of it.

A. Gower: Sounds good. I tend to err on the side of being succinct and precise, so I'll probably be under my ten minutes.

Good morning, everyone. Thanks for giving us some time to address the committee. As you know, we represent the Comox Valley Chamber of Commerce. We are the third-largest chamber on the Island. We've been around since 1919. We're almost 100 years old. Currently we represent 650 businesses. That makes us one of the largest chambers in the province.

Today we have six areas we'd like to talk about. In order, we want to address the situation with B.C. Ferries, the provincial sales tax structure, renewable resources, B.C. credit unions, local government finance, and B.C.'s arts and culture sector.

I'll start with the B.C. Ferries issue. I'm sure you're all very familiar with the recent UBCM Convention and the points they raised. Our chamber endorses those fully. We've listed them here in our presentation, and we agree with the UBCM's direction.

As an island economy, the ferry system is so critical to our economy working and to our businesses surviving. If you look at what the rates have done and compare it to other ferries operations around the world, we're not really on par, and we need to be. That's how the Island survives.

The next one is just talking about taxes. Our basic message — and the B.C. chamber echoes this — is: let's just bring back the HST. It was a tax system that worked. It was fair. It was easy to administer, and it had significant advantages over PST.

There's a lot of data in our presentation sheet. I'm sure all the members are very familiar with this. But that's the basic point we hear from all of our business members. The HST worked; a simple tax system works. The PST is somewhat regressive and in some cases punitive.

Skipping right along, then, talking about renewable resources. This refers to some of the cornerstones of our local economy, including agriculture, fisheries, aquaculture, forestry and renewable energy. These play a big role in the valley and in the province.

Right now we're seeing our provincial government focused on liquefied natural gas, mining and a western Canada focus on fossil fuel–based resource development. We acknowledge that these are great sources of wealth, but they are a short- to mid-term solution. They're not something that will operate in perpetuity.

I work as a professional engineer, and I have a pretty good understanding of the science behind that. However, fisheries, agriculture, aquaculture, forestry and renewable energy, which rely on a healthy physical environment, can operate in perpetuity. They are something our province has always been built on and something our local area is very firmly built on.

We've linked a bunch of other links here with some more information for the committee to review after. This is something that's key to us and to our membership — having legislation and taxation that support these sectors.

The next point has to do with B.C. credit unions. B.C. credit unions in a smaller community are your prime source of capital. From my own personal experience trying to obtain capital for business ventures, it's almost impossible to get them from a chartered bank when you're self-employed or when you're in a small business. That leads you to a credit union.

What we're seeing now is that some changes to taxation are increasing the tax burden on credit unions significantly. But at the same time, as a credit union they
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don't have the ability to leverage their assets as a chartered bank does. This can cause a significant problem to something that's a big driver of our local economies, and we'd really like to see the province address this issue.

I honestly didn't know about this until I read about it in the B.C. chamber's position paper, and I was kind of shocked. It seems like, as a business owner, it is such a logical thing that the credit unions maintain their competitiveness, and they need some supportive legislation, because they operate under different rules than a chartered bank.

The next issue we're concerned with is local government finance. Specifically, we're really talking about how businesses are taxed in the local government finance structure. I own commercial property as a business owner, and the level of tax I pay on commercial property compared to residential property, compared to the level of service provided, is somewhat ridiculous, to be perfectly honest.

In line with the B.C. chamber, we'd like to see the provincial government work to address this with our local governments so that there's more of an even playing field for businesses, for business property. Again, this is directly related to what we can do with our economy. It's not as if this taxation is absolutely required to maintain the functioning of our municipalities. There's some room there, so we'd like to see the province assist with that.

Our final point is talking about B.C. arts and culture and recognizing that we maybe need a new strategy for that. That's another cornerstone of our economy locally, with Vancouver Island MusicFest, with what was The Big Time Out and has now become Atmosphere. We have the shellfish festival, the Filberg Festival, Nautical Days. We're an arts and culture hub here in the Comox Valley, and that comes with a lot of economic drivers.

You come here in the summer, and you can't get a hotel room because all these festivals, all this arts and culture, are happening. It's not really fair to dismiss it as: "Oh, it's just these crazy artists." This is a real economic driver for us and across the province. We'd like to see the province step in with better grant application processes and better funding and better laws to keep that in our province and to help attract those businesses.

Those are our points. I don't want to belabour them. I just wanted to make sure they were covered and recognized.

D. Hawkins: Something I'd like to add is that the points we have presented to the select standing committee are also backed up by the B.C. chamber's policy and positions manual that was adopted at our recent AGM in May.

One note that I left off, only because the B.C. chamber's mandate has chosen to go a little farther than, perhaps, the Comox Valley chamber feels comfortable at this point in time…. Our chamber of commerce is currently asking citizens of the Comox Valley to sign a governance review petition so that we can have our local governments reviewed in how they are governed.

One of the things that we see as a disadvantage to the Comox Valley is that we have three municipalities and a regional district, and this can impede us when we're looking for federal grants as a solid entity. The Nanaimo Chamber of Commerce was able to collaborate and successively be granted the Successful Cities grant. Campbell River, as a single entity, is able to do the same thing.

We're not asking for amalgamation. We're asking that the province look at the governance of the Comox Valley as a whole.

A quick question, I guess for Andrew. How do you go from being an engineer that jumps out of airplanes to a sports consultant? I'm not reading my Facebook here. We looked you guys up to see what you do. Just curious — an interesting bio.

On the local government thing. We've been hearing this all over the province. We heard it at UBCM. I would encourage the chambers to get involved in that conversation, because it's extremely difficult for the province to dictate to local government how they're going to govern. I think it's important that you get involved, and at the provincial level, because there's a lot of legislation there that needs to be tweaked.

I want to go back to the taxation. We know the chamber supported the HST. It didn't work out so well. We need real direction, I guess, on how some sort of a — I won't call it HST — value-added tax would be instituted so that people would buy into it. That's my request.

E. Foster: No, I understand that. That's a request. I mean, everybody wants it, but we need to know how to get there.

J. Shin: As you know, the small business landscape in B.C. — about 85 percent of it is made up of microbusinesses with five employees or less. Of course, 55 percent of that is sole proprietorship with no paid help. I find that a lot of the time for some of these businesses and entrepreneurs that often need the most amount of advocacy, their voice is not necessarily heard.

I was just curious to find out what kind of work the chamber does in order to reach out to those groups of businesses and what proportion of the 650 businesses in your membership would currently come from that group?
[ Page 1093 ]

D. Hawkins: The largest employers in the Comox Valley are the air force base, the hospital, the school district, Mount Washington and the rest of it. I was born and raised in a family business in the Comox Valley. Small business is a big deal in the Comox Valley. And with the lesser amount of resource-based industries around the Comox Valley, it has greatly impacted us and our economy.

S. Gibson: Just further to the point that was addressed here regarding local government, and you have the issue of finances. I want to share something with you and then ask the question.

I came from a city background where we had two communities that needed to get together. It took them three tries to get Matsqui and Abbotsford together. Now Abbotsford is the fifth-largest community in B.C. and gets lots of attention. I want to encourage you to work with your councils on that, and I'd like your comments.

The other thing is an idea. You're often dealing with egos. I know that we don't have that up here, but some places do. What you can start out with — make the councils larger, and then cut back. That's what we did. You have the 12 members, and you cut back to what you want, so it allows everybody to be involved. I just want to encourage you, and maybe you have a comment.

Chambers — you guys can have a huge impact, as members, to get amalgamation started.

D. Hawkins: I have a friend who's a former mayor, and one of his mantras is: "Egos eat brains."

Aside from that, we are making formal presentations to the city and town councils all through the month of October, as well as the downtown BIAs, the regional district. We're taking a proactive approach. We feel that together we all win, and I think that's something that we need to say.

G. Heyman: Thanks very much for your presentation and particularly for making it so specific to your circumstances on the Island. I want to ask you a question about your submission on renewable resources. I haven't had a chance to go to your links. The answers may be there.

You said: "The province needs to do more via tax credits, helpful legislation and incentives with respect to value-added processing." I'm wondering if you'd care to elaborate on that a little bit.

In the arts and culture you're talking about some stimulus to that sector, which I think — I hope — we would all agree is important not just to community life but to economic life. I'm just curious: do you see that happening through Creative B.C. or some other agency or through tax credits? Or are you leaving it to government to figure it out?

A. Gower: With renewable resources. I'm not an expert in the legislation that governs the value-added, but I am observant. I've spent time up on the central coast in some of the ghost towns there and seen the plants and equipment that were operating. I know there are economic factors that impact those value-added processes.

We had a big sawmill here on the river. There is a big, empty lot across the river now right across the bridge here. That was a big sawmill that was one of the main employers, and it's gone. Things have changed.

We're just asking for the province to do what they can to bring that value-added processing here. You know, we export raw logs — great export resources — but if you can add a step with adding value locally, the amount that brings back to your economy is more than just the cost of doing the work. Then you've added that value.

The same goes for Mr. Black's oil refinery he wants to put on the north coast. It's the same concept. Instead of just shipping all the petroleum and all the bitumen out of the country, let's add value here before it leaves, or someone else is going to refine it. I'm not the biggest supporter of that project. I'm just citing that as an example of the principle.

For arts, I think the major issue is with gaming grants and with the amount of gaming money that's available. As I understand, some of the grant applications are very simple and streamlined through the province, but the gaming grants are maybe not the best approach. They could use some revision.

As someone who's been involved in grant writing and grant applications…. You can do a lot of work and get nothing, and then you ask yourself: "Well, why am I going to bother? I'll just go raise money for my local economy." The local economy only has a certain amount of capacity.

G. Heyman: It does. Thank you. I understand what you're referencing with respect to gaming grants from my time at a non-profit. They are complex applications, and you never know what will result in a turndown.

D. Hawkins: The B.C. chamber is asking for longer, to institute a three-year funding cycle so that planning can take place for these organizations. It's so they're not sort of hitting the deck running and scrambling so that things can be rolled out and to create the interests that they need to make programs happen.

Just a quick question on the three-year…. What about a sunset clause? I'm just curious because, you know, that is one of the issues of the demand. There's huge demand, limited funds. And there are some that live off of these grants on a continual basis without having to…. Is a sunset clause something that should be brought in also?
[ Page 1094 ]

D. Ashton (Chair): Good morning. PacificSport Vancouver Island, Mr. Cooper. Welcome. Glad to see you today.

Our process is we've allotted ten minutes for the presentation. I'll give you a two-minute warning if I think you're going to be close to going over. We have five minutes for questions and comments, and we literally use all the time.

D. Cooper: Thank you very much. Many thanks for the opportunity to meet with you all today.

It's hard to believe that we're entering our 20th year of operation as a regional sports centre. For most of this time our main focus has been on services to high-performance athletes and the pursuit of gold medals at the local, regional and national levels. In the past four years, we've been tasked with enhancing participation rates in sports and physical activity.

Today our reach is quite extensive, connecting with over 4,000 athletes, coaches, teachers, students and parents each year in a diverse range of programs — from fundamental moving skills for children and parents at the active start stage through to supports for Olympic and Paralympic athletes who are competing on behalf of our country at the international level.

This might be a good time to remind the committee that PacificSport, in collaboration with our partners at the Canadian Sport Institute Pacific, have created a model that is the envy of the rest of the country. At the most recent Olympic Summer Games in London, though B.C. represents just 13 percent of the population, B.C. athletes represented 40 percent of the national team that went there, and we won 50 percent of the medals. That's certainly something that….

I know that whenever I travel to other provinces or other people from out of B.C. come to visit us, we certainly hear about how much they recognize what a difference this process is making to the sport system here in British Columbia and the impact it's having internationally.

While such high performance stats are impressive, it's what's happening at the grassroots level that makes my job so rewarding. Allow me to share with you a brief anecdote that speaks to the impact of sport as a tool for community development.

One of our programs is an after-school initiative where we spend approximately 90 minutes a day at a number of different schools in the Nanaimo region. In the beginning, if I was to describe it, it might be more like an excerpt from Lord of the Flies, because there's a lot of chaos going on. The kids are running around rather wildly. There's often a kid sulking on the side of the gymnasium complaining about other kids who are cheating and not playing fairly.

Once we kind of got our groove and kids kind of got used to the leaders that we hired to deliver this program, I mustered up the courage to talk to one of the school administrators and asked: "How we doing?" The response was: "You have no idea. On the day that you guys come to our school, that's the day that we know that these 30 kids are going to be in school. Otherwise, their attendance rate varies 50 percent." They added: "On top of that, the kids, when they come on that day, they're at their best behaviour because they know if they get sent home, they won't be able to participate."

Now, I've had some personal successes in sport as an athlete and as a coach. In the 20 years that I've been doing this, we've done some things that I'm really proud of. But nothing has touched me as this has, as hearing that message.

We've secured some additional funding for this program that's allowed it to grow from just five schools two years ago to 20 schools in this past year. That funding is secured for the foreseeable future.

What's really interesting for an old jock like me is the part that this funding is being used to support art initiatives as well as the sport initiatives that we're delivering on. Four years ago I never would have dreamed that sport would play such a pivotal role, not only in enhancing physical activity in school-age children but also delivering on cultural initiatives as well.

Let me talk briefly about some other notable achievements over the past year. As a result of promotion of the Canadian Sport for Life model throughout the region, we're partnering with the Cowichan Valley regional district, the town of North Cowichan and the city of Duncan to develop a regionwide strategy where education, health, sport and recreation sectors are going to collaborate on delivery of physical literacy initiatives. This will serve as a pilot for other municipalities and regional districts within the constituency we serve.

We secured a research and development grant this past year which allowed us to hold some public forums in school districts in communities in the central Island area. This was to gauge interest in the delivery of the physical literacy mentorship program that we do. The mentorship program trains teachers how to deliver a quality physical education class so that students come away with sound fundamental movement skills that provide them the confidence and competence to try new sports and thereby get more kids physically active.
[ Page 1095 ]

PacificSport is working in partnership with Island Health to assist daycare licensees in getting staff physical literacy leadership skills training so as to ensure that their charges get the recommended daily amount of quality physical activity.

I'd be remiss in not speaking to the impact of your investment in PacificSport. It wasn't too long ago that 40 percent of our resources were devoted to fundraising initiatives. I've got to tell you that it wasn't really…. Getting up to go to work to raise money as opposed to delivering on the programs and services that we wanted to deliver was not the most fun aspect of my job.

Today we spend 95 percent of our energy on the kinds of programs and initiatives that are having an impact on our communities. A recent example was the B.C. Summer Games that happened this past summer in Nanaimo. PacificSport was able to secure $200,000 in funding that went towards the paid staff to run the games, supply computers, office supplies. Ultimately, that represented better than 20 percent of the total amount that was raised for the games.

Because of our increased productivity, partners and stakeholders now seek us out to engage in joint initiatives. As a result, we attract investment from the municipal and educational sectors that provide approximately 400 — more than 400 — percent return on your investment. That's an ROI that I think any business would be proud of.

While we're grateful for our current situation, I believe there's room for improvement. Though I have a number of things in mind, I'll share just two quick comments.

I believe we need leadership across multiple ministries to ensure that teachers graduating from post-secondary teaching institutions are trained to deliver quality PE, based on physical literacy principles. School districts can be encouraged to make this training a minimal requirement for hiring. I believe government can play a role in fostering this.

I believe that our ultimate goal is to eventually reduce the ever-burgeoning health care budget. I think it's time to task some of our best and brightest minds to investigate and/or research how to enhance preventative health initiatives through taxation of sugary foods and fatty snacks. While it has had mixed success in other jurisdictions, I'm a firm believer that we have the capacity within this province to come up with something workable.

There's a much bigger shopping list that I have, but I'm going to leave it at those two items. Thank you for your time and attention today. It's always a pleasure to share some of our successes and hopefully spark some ideas for moving forward on sport and physical activity initiatives.

G. Holman: Thanks for your presentation. I'm particularly interested in your suggestion about taxation of sugary foods and fatty snacks. You talk about mixed success. Are there jurisdictions where you feel it has worked? If there's any additional information you could provide the committee on that — it has come up before as a recommendation — the deadline's October 17. If you have any additional information on that, it would be good to have a look at that. Is there a particular jurisdiction where it's worked?

D. Cooper: Well, just in some cursory exploration that I've done, there are a number of jurisdictions. U.S.A., Great Britain and Denmark are some that have pursued this. I know that in some cases they're still working through the kinks. I believe that some of them are seeing some success. I know that Denmark has been a real failure and has actually pulled their program back.

G. Holman: Just quickly, in those jurisdictions where it has succeeded, is there an earmarking of the funding for sport-related physical activity, or does it just go into the general pot?

D. Cooper: Good question. I don't know the answer to that, Gary, but I'd be happy to look into that further.

C. James (Deputy Chair): Thanks, Drew, for your presentation. I appreciated hearing about the broader goal and the expansion of the work of PacificSport.

I wonder if you do any kind of tracking of the young people who go through the programs that you're putting in place to see whether there has been an impact on that lifelong fitness. I think that it's a laudable goal and, I know, a challenge. I wondered whether there was any kind of research being done.

D. Cooper: At this particular time, that's an initiative that we have undertaken. It's in the very early stages.

Where we're tracking right now is at the emerging athlete stage. We're not able to connect with and identify the kids we're working with in the after-school program, for, although one day I would really like to see a kid make the B.C. team or maybe even the national team coming out of that program. That would be sweet. Our intent is to have a system in place eventually that will be able to track that.

M. Morris: Good presentation. PacificSport is doing a great job in B.C. We've got the Canada Winter Games coming up in Prince George in February this year, so I'm looking forward to that.

D. Cooper: Our partners up that way are playing a lead role, I know, in that too.
[ Page 1096 ]

I'm interested in your comment on physical literacy principles. Is PacificSport playing a significant role with our school system throughout the province here in trying to inject more physical literacy into the school programs themselves?

D. Cooper: Yeah. I'm really glad you brought that up, Mike. The way it is right now…. We've been getting $11,000 a year to train teachers, which allows us to go into five different schools for a 12-week period. I've got eight school districts in my region. At that rate, of five schools a year, it'll take me 35 years to hit all the teachers.

We're getting started, but I think we need to up the ante on that one. The challenge is that many school teachers who are coming out of the post-secondary institutions now are themselves…. You know, that's their idea of physical activity. So we need to get these folks jacked and trained about what physical literacy is all about so that they can start imparting it to those kids.

Kids who are trained and physically literate, with the basic fundamental movement skills, are then more confident and capable of going out and participating and trying things. Kids right now don't want to try different sports. They'll go out for a day, they won't succeed, and they'll throw in the towel and go back to the couch.

D. Ashton (Chair): Drew, thank you very much. Great presentation. Have a good day.

Next up we have Parksville-Qualicum Lyme Disease Support Group. Hi, Sue. Welcome. Thank you very much for coming today.

Sue, we have ten minutes allotted for the presentation. I'll give you a two minute warning, if required, and then we have five minutes for questions and comments. We definitely use most of the time up.

Well, thank you very much. As you know, I'm from the Parksville-Qualicum Lyme Disease Support Group. I know that you've had several presentations from the Lyme community, so I'm hoping not to repeat what you've already been told.

My focus today is on public education. But first, let's backtrack a moment. I'd like you to think about the economic impact of having numerous people with a disease that is undiagnosed. What you have is somebody who gets sick, and they go from doctor to doctor to doctor — often 20 doctors, numerous tests. That is a huge drain on our health care system. We also end up with these same people no longer able to be productive citizens. They're a drain on the tax system. They're a drain on business, and a lot of them end up on social services or other disability programs. That's just to give you an idea of the impact.

What I would like to suggest that the government do is take on an approach of education of tick awareness. Just think back about what we did with West Nile. Everybody stopped mosquitoes from having sex. Well, we need to do a very similar thing with ticks. You want to learn about the life cycle of the tick.

To start with, when the mother tick, or the female tick, is about to lay eggs, she lays over 3,000 eggs. Then she dies. She leaves behind a lovely little fat pad that attracts rodents, particularly mice. They come and eat that, and they become the first meal for the larva. Rodents tend to have a very low immune system that makes them a perfect reservoir for all these different pathogens or infections that can cause human disease and suffering.

What happens is you've got these rodents now carrying all these little ticks. They have a feed. They become infected. They morph into the next stage, which then becomes nymphs. The nymphs feed on larger animals, including humans, our pets and what have you. This is the stage we really need to focus on. At any rate, the ticks then morph again after having a feed, and they become full adult ticks. You again now end up with the 3,000 eggs.

Deer are becoming a real problem too. An average deer can host 300 ticks. So you've got the rodents as a reservoir for the infections, you've got us keeping them going, and then you've got the deer spreading them around.

But we also have birds. John Scott did a research study on migratory songbirds, and he found the birds can transmit ticks all over North America and including much of world. For example, a tick can be in a backyard in California on Thursday and be in your yard in B.C. on Saturday. This is how these infections get spread around.

The U.S. CDC has now stated that there are 300,000 cases annually of Lyme disease.

We, unfortunately, don't have those kinds of numbers, but I think that comes back to the medical system not looking for and not being aware of it.

So what are the things we can do as citizens — or as the government, when you're teaching the citizens about Lyme disease and particularly about tick eradication? What we need to do is learn about how to get rid of ticks.

First thing we need to do is clean up our bird feeders. Birds end up spreading seeds all over the place. That, of course, provides a natural food for rodents, so our rodent population is probably higher than it needs to be.

There's a product you can get called Tick Tubes. There's a company called Damminix in the States that produces these tubes, or you can make them on your own. Basically, what it is, is empty toilet paper rolls, lint from your dryer and tick-and-flea shampoo. You just soak the lint in the shampoo, let it dry, stuff it in the toilet paper rolls and distribute them where rodents tend to wander. What hap-
[ Page 1097 ]
pens is they take the lint and line their nests with it, so you're killing off a lot of ticks right there.

Another thing you can do is deer-feeding stations. I know that doesn't make a lot of sense, but what they do is — in the States they found this to be successful — they create these deer-feeding stations, and they have rollers that the deer have to pass through to feed. The rollers have a tick repellent on them or something that kills the ticks, so you're again cutting down the population.

Every time we can cut down the population of these ticks, we are making it less likely that we'll be infected. Personally, the last time I became infected, I was picking weeds in my front yard for 20 minutes. I live in a subdivision. I don't live in the bush. I don't have high grass in my yard — or my neighbours. We're all quite fastidious about keeping our yards looking great. So these are a few things.

There's also a spray you can use that was created by a master gardener in the United States called Jerry Baker. He calls it Toodle-oo tick spray. At any rate, it's just dish soap, water and rubbing alcohol. You put that in a hose and sprayer, and you spray your yard in the evening. What that does is the rubbing alcohol breaks down the coating that ticks have on them, and it allows the ticks to dehydrate. Dehydration is a tick's number one worry.

That's why we often recommend that gardeners or people that have been outside enjoying our nature take their clothes off when they get in the house and put them in the dryer, because it kills the ticks. Naturally you think: "Put it in the washer." But you can see the tick sitting on the agitator afterwards. They don't mind the joy ride.

At any rate, that's all I really wanted to share with you. There are little things you can do in your yard, like making sure that you don't have firewood stacked in a moist spot. You want it to allow ventilation so it's not dry. People have brought firewood and ticks in at the same time. So, you know, little things like that.

I would like to see the B.C. government take on a proactive educational program through media in whatever way you can. All right. Well, I thank you very much for your time.

G. Holman: Thanks for your presentation. We've had presentations a couple of other times on this tour. My understanding is that one of the real key issues is the lack of a reliable test, particularly in Canada.

G. Holman: You would confirm that. My understanding is…. Just to clarify the work that needs to be done in that regard. There are tests in the States. As you noted, there are hundreds of thousands of cases being identified in the States, and there apparently is a reliable test there. I'm not clear why it's not used in Canada. Or maybe it is. Could you clarify that?

S. Aldous: Yes. First of all, the test that's used in Canada is considered the gold standard. There is two-tier testing. The first is the ELISA, which has, from my understanding, a 30 percent success rate, which seems kind of pathetic. Then there's the western blot, which is a lot more sensitive. But even the western blot is inaccurate.

In the States they use the western blot. They've already tossed the ELISA. They found it was a waste of time. It was causing too many false negatives. But even the western blot is not a very reliable test. Lyme disease should be a clinical diagnosis based on symptoms. Lyme disease itself has one of the most varied symptom lists you can imagine. In fact, the only other disease that I've heard of that is equivalent is syphilis. They are both spirochetal diseases, so in a way, it's not surprising.

J. Shin: Thank you, Sue, for the presentation. I just really appreciate the fact that not only does your support group provide the support work to those with Lyme disease, I'm assuming, but beyond that, you are going out there and taking all these proactive measures to promote public awareness and education on the issue. I wanted to thank you for that.

I also wanted to ask if you have already started — besides us, obviously — reaching out to clinics and schools with this same sort of presentation. Given that support work and advocacy work and also this promotional work you do, where does your funding come from, if any? How do you operate all this?

S. Aldous: Well, a lot of it comes out of our own pockets. Fundraising has happened through our awareness events. We had a booth at the Qualicum Beach Farmers Market during the summer, just one day, and we gained some donations then. We also had an awareness event in May in Parksville and had some generous donors. So that helped.

For the most part, I've been doing this for nine years, and most of it has come out of my own personal pocket. You can see that the printer…. I'm running out of ink.

The presentation will be ten minutes. We'll give you a two-minute warning, and then we have five minutes for questions and answers.

R. Bealing: I'm not really here to ask for anything today. I'm not asking for government to put its hand in taxpayers' pocket any deeper than it already does. I'm here to talk to you about a sector — a regulatory model and a business model — that by and large is successful. However, it is vulnerable to things government may or may not do. That's my theme here today.

I've shared some information with you. I'd like to just walk you through the message pack a little bit here. I've met a number of you before, and I think you know my story.

We are farmers of trees — B.C.'s private forest landowners. We bought land. We manage it for growing and harvesting timber, and in the process of doing that, we generate a lot of economic and environmental benefits. We are really proud of what we do.

If you look at page 2 in our presentation here, the provincial government can encourage responsible stewardship of private forest lands. We think responsible stewardship of all forest lands is a good thing. We're going to focus primarily on private land, because that's what we're all about.

What do we need to maintain that model, the success of that model? We need policy distinction. We need government to recognize that there are a lot of things in common with Crown land but there are also some key distinct differences; namely, that we bought the land, we're paying taxes on it, and we're making investments on it. The fact that we're making those investments and managing that land intensively provides all kinds of economic benefits, and it's kept in check by regulation and certification to balance the environmental and social side.

We need a competitive regulatory framework. Forestry is a brutally competitive global industry, and if we do anything to ourselves that inhibits our ability to compete globally, we put ourselves at a disadvantage — and the people that work with us, the people that work on our land and buy our lumber and that kind of thing.

This is probably the key one today that I'd like to talk about. Provincial jurisdiction over forest management is really important. We've got three layers of government: local government, provincial government and federal government. Because there are no federal politicians here today, I can tell you how important it is that the province continue to play a lead role.

On the private land we're in the valley bottoms, we're on the coast, and we're around the urban centres, where there's the fastest rate of growth in communities in B.C. So there's a lot of public interest in what we're doing on our land. We like to think we're doing a pretty good job of balancing that when it comes to things like recreation, drinking water and just concerns of the forest practices. Are we protecting fish? Are we protecting wildlife habitat? That kind of thing. We're absolutely in the goldfish bowl compared to Crown land.

There's a lot of local government interest in what we're doing on our land base. We do our best to be good neighbours. At the same time, we're trying to run a business, we're trying to grow and harvest trees, and it does mean that we're cutting down trees. Sometimes there are people that don't want to see that happening, so there's a clear challenge there in keeping those communities on side.

Our regulatory model maintains provincial jurisdiction over those lands. Forest practices are a provincial jurisdiction. At the same time, we have challenges with some of the federal legislation, particularly the Species at Risk Act, the Migratory Birds Convention Act.

There have been some well-publicized legal challenges against the federal government for not implementing processes within the Species at Risk Act, and the federal government is under pressure to follow those steps. However, the way the Species at Risk Act is written and implemented and interpreted doesn't really take into account the things that we're doing on the land voluntarily, the things that we're doing in conjunction with the province. Although the Species at Risk Act is supposed to recognize provincial protections, it's a bit lumpy. It's really not working as well as it should.

It's putting us in the spot where we're saying: "Look, we recognize that these species are important." We recognize that they are on our land. In fact, we've been monitoring them. We've got biologists on the ground. We've got our operators trained to identify nests and bear dens and habitat and goodness knows what. We're doing all kinds of practical things on the ground to protect these things, but unfortunately, we're not getting recognition under the SARA structure.

What we need is for the province to continue to take ownership of endangered species and wildlife generally in British Columbia — make it a provincial priority, as it has been doing, but continue on that and maintain the jurisdiction generally.

What else do we need? A competitive tax model. Again, we're in a globally competitive business. If our competitors in other countries are paying a lot less in property tax than us, it just puts us at a disadvantage.

No. 5, and this is what I'd be very grateful if you could fix without any further ado, is log export restrictions. I'd
[ Page 1099 ]
appreciate your work on this. We have a very difficult situation in coastal B.C. We're a high-cost production area. We need globally competitive log prices to sustain our globally competitive log-harvesting and timber-growing practices.

Unfortunately, we've got a situation where our domestic log market is well below the international price that we can achieve for our product. It's a very tough business to be in where the domestic price offered for our product is less than our cost of production.

Currently we are required by provincial and federal policy to offer our logs to domestic mills before we can obtain an export permit in order to get international prices, so it puts us in a very difficult position indeed. We're losing a tremendous amount of value.

I'd be more than happy to go into detail with you at any opportunity. You probably don't have the real time for it today, but I think I've talked to a number of you over the years and raised the issues about that.

R. Bealing: Two minutes. Well, I said I wouldn't drag you through the presentation. I wanted to make this a bit more interactive.

We are really proud of our performance, our track record. We are very good at reforesting. We're very good at growing timber on our land. We generate approximately 10 percent of the provincial harvest off about 2 percent of the land base. That's a big-picture indicator of what an important role private forestry plays.

We can't pick up our land and go somewhere else with it. We're focused on improving the value of our land, improving the productivity. When we do that, not only do we benefit as owners because our land is worth more, but the people who work with us…. There's more wood to harvest. There are more benefits generated that way.

But as I pointed out, it's a model that is sensitive. We need to get international prices for our logs. We're not asking for any special treatment there. We want an internationally competitive tax model, and we need the province to maintain jurisdiction over forest practices and, especially, wildlife.

D. Ashton (Chair): Rod, thank you. Please accept my apologies. I did have to take that call. I apologize.

J. Yap: You've listed some stats here — 20,000 people, full-time jobs, etc. What are the taxes that your sector pays to B.C.?

R. Bealing: Thanks for bringing that up. We pay property tax, just like every other homeowner or property owner in the province. The numbers — I can follow up with that.

R. Bealing: Well, of course. If we have a profitable business, then we pay corporate tax, and everybody who works on the land that makes a living pays income tax as well.

An interesting little tidbit is that we pay more in property tax per cubic metre than the Crown collects in stumpage on Crown land, so it's a screaming good deal for the public. You sell the land, and you actually get more revenue after you sold it than you did if you'd continued with the Crown land model. We're not necessarily happy about that. We'd like to pay less tax, but that's a fact.

J. Yap: Could you get for us, as a sector, what you pay in total taxes to the province — property taxes, corporate income tax, sales tax, etc.?

G. Holman: Thanks for the presentation, Rod. Just curious about…. Do you have data on the proportion of private land log production? What proportion is milled in British Columbia?

R. Bealing: For 2013 approximately 60 percent of our coastal volume was exported, so 40 percent would have been domestically manufactured.

G. Holman: Okay. Regarding the concern that the province retain its jurisdiction, you raised a couple of issues there. You were talking about species at risk and the concern about federal legislation. My understanding is that the province doesn't have species-at-risk legislation, so how does that value…? How is that dealt with by a province that doesn't have the legislation?

R. Bealing: It's an interesting relationship between the federal and provincial governments in this case. As it applies to private land, we have a regulatory model that mirrors…. Essentially, it's generated from a list of creatures. The Species at Risk Act generates a list of creatures that are endangered. The federal government is saying that we should protect these animals and protect their habitat, and the province is driven to do the same thing.

The way that the Species at Risk Act works: if the province doesn't have its act together, it overrides, basic-
[ Page 1100 ]
ally. So it doesn't matter if it's B.C., Alberta, Manitoba. Whether it's Crown or private land, there's a compelling case for the province to have regulatory measures in place, which it does. We have a critical wildlife habitat provision within our legislation. The province doesn't have the same structure as the Species at Risk Act, but it has the same….

M. Morris: Good to hear from you again. A couple of things. I've always been mystified as to the enormous difference between the international price of fibre and our domestic price of fibre in B.C. here. But looking at the private forest owners within British Columbia, most of the area owned by private forest companies is coastal, because there's very little in the Interior.

M. Morris: Does that have something to do with the recycling, the growth of trees? They grow a lot quicker down here. It's more profitable for private owners to invest in that on the coast versus….

R. Bealing: Those things are true. It's mainly historic. The private land that's in B.C. — and it's only about 5 percent of the province — was mostly railway or kind of early pioneer, for agriculture stuff and townsites. But most of the land that we're managing to grow timber on was to do with Confederation and railways.

G. Heyman: I spent quite a few years both logging and scaling logs on the coast in the north, and I watched the volume of logs being exported increase over time. I scaled booms of beautiful clear spruce that was being exported at the same time that people in the northwest who were looking to start some niche value-added businesses were telling me they could not access fibre.

Now, you say that it's a myth that exporting a log is exporting a job, and I don't dispute that if you're not logging, there is no job. If you are logging and exporting, there are a number of jobs. But if you're logging and manufacturing in B.C., there are even more jobs.

I want to turn the question on it's head a little bit, because it's a bit of a chicken-and-egg question. Yes, obviously, if there's no domestic market and you're left with someplace offshore to sell, that's where your market is. But can anything be done, in your view, to enhance a domestic market for logs that would allow you to sell your timber and other people to be employed processing it in B.C.?

R. Bealing: That's a terrific question. I think we might have to follow up on this because I'd really enjoy that dialogue with you. The answer, really, is to bring everybody up to a globally competitive level.

You're absolutely right. If we're growing the timber, everybody that works on the land harvesting the trees, and we're processing it in the same jurisdiction and everybody's competitive and making money, that would be where we should be. That's where we should aim to be. It would be better for us. It would be better for the processing sector. How do we get there? We've got to get off this addiction to cheap fibre which we're on. There, that's the question.

D. Ashton (Chair): You'll have to carry it on after, if you don't mind. Sir, thank you very much, greatly appreciated. Thank you for your presentation, Rod.

Sir, welcome. Thank you very much for coming today. We have ten minutes for the presentation. I'll give you a two-minute warning if required. We have five minutes for the questions, and we're using every minute.

M. McLachlan: Let me get started. I am pleased again to be here in front of this group. I recognize some…. I won't say old faces but some familiar faces and some new faces.

Let me just take one moment and reacquaint you and maybe acquaint the new folks with who we are. BCCA represents over 2,000 construction employers here in the province. We have an integrated membership structure with four regional associations. Our companies are all employer companies. They're active in all areas of the construction industry.

We're not a labour relations organization, so our membership includes both union and non-union. We cover the entire spectrum, if you will, of the construction process. By that I mean general contractors, trade contractors, manufacturers and suppliers.

It's important to note that BCCA works on behalf of the entire sector, not just our membership. We manage provincewide programs that are available to any construction employer, and we advocate on key issues that are relevant sectorwide.

To illustrate the key role that construction plays in our province, I'd like to share some key statistics with you. But I want to take a moment to state very plainly that there are really two key issues in front of our sector today: access to a skilled workforce, and fair and transparent procurement processes. The positive role that government can play in supporting industry to successfully meet these challenges cannot be underestimated, nor can the impact these issues will have on the economy.

Just a few stats. Construction continues to be the number one employer in the B.C. goods sector, contributing
[ Page 1101 ]
about 7.9 percent of B.C.'s GDP. That's a little more than forestry, oil and gas, and mining combined. A new report from Central 1 Credit Union estimates that this contribution will increase by 31 percent by 2018.

There are approximately 196,000 British Columbians who work in the industry. That again is more than the number of people who work in agriculture, forestry, fishing and mining combined. Two out of three construction employees today are under the age of 45, and about 70 percent of construction employers hired new tradespeople this past year.

In B.C. today there are about 46,000 unemployed youth. Today in B.C. only one out of 32 students entered the trades — that's the full range of trades — and we've discovered that only one out of 85 enters the construction trades. B.C. needs that number to be about one in five if we're going to meet the skilled trades shortage that's on the immediate horizon — LNG or no LNG.

Eighteen percent of employers have searched internationally within the last 12 months. The current estimated value of construction projects underway in B.C. right now is $84 billion with another $206 billion proposed. And 75 percent of construction employers tell us that they feel the competition for projects has increased in the past two years. That increase is both regional and national and includes international competition.

They are compelling stats. They speak directly to the challenges and, I think, the opportunities that are in front of us.

Our submission today covers off ten areas, and I'm not going to try and deal with all ten of them in ten minutes. There are key areas that we think are vital to the industry and its role in the economy.

I want to touch very briefly on PST. We've dealt with that in previous submissions. I want to commend the government for work that has been done in clarifying a number of issues. There have been some bulletins that have been put out, which are directly related to the construction industry, and that have clarified a number of things. There is one area of concern I just want to touch on quickly.

We see the issues around real property situated outside of B.C. I know this PST stuff gets a little bit complicated when you start dealing with real and what they call non-real property. This issue deals with the requirement for a contractor or supplier who must pay PST on materials that are purchased in B.C. even if the real property, where it will be affixed or installed, is situated outside of B.C. It's worrisome because it affects our competitiveness across the regions and across the area that we're working in, particularly outside of B.C.

There is some work that needs to be done on that. This type of policy erodes, we believe, business confidence in the B.C. economy. It limits incentive to perform value-added processing within our borders.

On the fair and transparent public sector procurement, there has been a significant development and one we want to again recognize government for taking on. For the ten or so years that I've been in front of this committee, we've been talking about a need for a centralized point of contact to deal with issues related to public sector procurement.

Government has agreed and put in place what's called the deputy ministers industry infrastructure forum. This forum has been meeting quarterly for the past year. It's the senior representatives of the construction industry and the deputy ministers of the capital ministries that are working together to improve procurement processes in a number of areas.

The first area we're working on is the capital asset management framework, which is the comprehensive document intended to provide assistance to public agencies in finding the best capital management practices.

That's front and centre. The November meeting will be dealing with a report from a subcommittee that's been put together to rewrite elements of the capital asset management framework.

We do want to continue our recommendation that government adopt the capital asset management framework as public procurement policy, not as a guideline. This step will require government at all levels to comply with good tendering practices that again ensure open, fair and transparent processes.

I want to touch briefly on an area that we're all working collectively on. It's under what we call the aboriginal enhancement policies and alternatives that we think need to be recognized there. We're well aware that there's a large segment of our population that has historically been underrepresented in the construction labour force. It includes aboriginals. It also includes women, landed immigrants and people with disabilities.

We're an active partner in a number of major projects dedicated to the development of employment opportunities for aboriginals. What we're seeing is that in the pursuit of the means to illustrate action related to the enhancement of aboriginal involvement in public sector construction, public bodies have developed bid documents with requirements that often include the need for bidding contractors to engage aboriginal contractors directly or the use of equipment owned and operated by aboriginal contractors.

While well intentioned, these requirements often create unintended consequences. For instance, it leaves each bidder at the risk of not always being able to engage the aboriginal community on an equal basis, thereby creating immense potential for a bidding process that's not fair, open and transparent.

Clear requirements without the bidding authority's oversight may not always result in the aboriginal contractor's engagement but rather a surreptitious agreement that never actually results in any work being
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undertaken by the aboriginal community. The methodology is so complicated that it doesn't achieve the result of having aboriginal contractors involved, because there are limited contractors with contractors not bidding.

We're recommending that government commit resources to examine all current aboriginal enhancement policies to ensure that the processes in play actually generate the outcomes they were designed for. That includes creating a means of measuring outcomes and expanding the list of options that would be considered acceptable enhancement initiatives, including tying in to functioning employment programs that are in place today.

Quickly, prompt payment is an issue that's emerged not just in British Columbia, but it's an issue that's now emerged across Canada. I've attached to the submission an executive summary of a report that came out of Ontario. This is not about non-payment. It's the delay of payment in the industry.

In the industry, we talk about a construction pyramid. When the general contractor at the top of the pyramid doesn't get paid, the subtrades don't get paid. When subtrades don't get paid, they're limited in their capacity to hire. It increases the cost of projects because you're adding money to manage the risk. Again, it's another complicated area. I know it's on the agenda for the deputy minister's infrastructure forum, but I wanted to have it in front of this committee as well.

We believe — industry believes; this is not just a BCCA position — that a concerted effort is being made by organizations across the industry to address this payment issue. It's not about non-payment. The lien legislation covers that. It's an area that is going to require some concerted work on behalf of both the industry and government.

M. Morris: Just a point of clarification on the late payment — late payment from the people who are contracting services, or late payment from government sources?

M. McLachlan: It's both government and the private sector. This is where it gets a little…. We've had conversations with government, and the indication is that that could be addressed on a policy basis. Now, it's not just provincial governments and municipal governments. We'll say it's owners in general. The reason we're thinking legislation is the way to go is because then it draws in the private sector.

This was attempted in Ontario prior to the last election. There were a lot of lessons learned by a lot of folks in how to implement that sort of thing. We're trying to engage every single element of the procurement process and the contract administration process to make sure that when we go to government we'll have a position that everybody can support.

S. Gibson: Your statistics are alarming on page 2 with regard to young people going into construction trades. We need one out of five; we're currently getting one out of 32. What's your prescription to solve that problem, that challenge? It's complicated, I think.

M. McLachlan: It's complicated. Under the "Building the workforce" section we've got some recommendations. We think this is all our responsibility. Government and certainly the…. We support the skills-for-jobs blueprint. We support the recommendations that came out of the McDonald report on the ITA. The notion of re-engineering the education system — we're fully supportive. But it has to go beyond that, right? It's about relevant training. It's about the revenue required to make that training happen. We need to focus on successful graduates.

Then the fourth element in the formula we put together under "responsibility." It's the system's responsibility to train people. That's relevant. But it's also the employers' responsibility to take on young people when they come in. I've got to tell you I'm appalled at the record across Canada, where we have about…. The number runs between 18 and 30 percent of employers who hire apprentices. To me, it doesn't make any sense. Employers have to take accountability and responsibility for the future of the workforce.

There's a third element here, and we refer to it as the family table. That's a culture shift that's going to be required. I've said quite often that if you had a magic garage door opener and travelled through any suburb in this province and opened every garage door, it's very likely that you won't find any tools in those garages. I grew up with my dad and my uncles who were fixing stuff all the time. I suspect many of you did. Today's kids don't get that.

We say it's a family table issue because we all want our kids to go to university. The system's geared to getting people into university, but we've got to change that culture approach. There are a lot of young people making a lot money today — unfortunately, some of them in northern B.C. But fortunately, they're making a lot of money in northern B.C. The opportunities are going to be here in British Columbia.

G. Holman: Thanks for the presentation. Just quickly, a lot of substance here — we'll have to absorb it later. You mentioned the deputy minister infrastructure forum. Is
[ Page 1103 ]
that the right name? I should know this, but can you just explain what that group is doing? I guess I'm wondering about its role versus the Finance Committee's role in terms of making recommendations about the construction sector.

M. McLachlan: Well, the forum…. The deputy ministers are the deputy ministers of all the capital ministries. So anybody that buys construction has a capital budget. The deputies are represented there. We have a group of industry representatives — not just from BCCA but representatives from other associations, including ICBA. We've made sure that everybody that sits at that table has participation in other organizations.

We have an agenda that speaks to…. As I indicated, the capital asset management framework is the first piece that we're dealing with. There are two elements that are being considered right now around privilege clauses and…. My mind's gone blank. I can't remember the second one. We're slowly working through those types of policies.

I think the relationship to this committee…. That's a great question. I would believe that the results of the capital asset management framework are relevant to the work that you're doing here. I'm not sure how they integrate, but….

G. Holman: Are the range of recommendations you've made to us…? I take it it's somewhat broader than being considered by that group.

J. Shin: Just a point of clarity for me. On page 4, I see that there's a recommendation that there should be a small business…. Distinguishing between the bigger and the smaller…. And you're saying that one of the recommendations is the total annual revenue being under $500,000. My understanding is that currently right now it's considered small if it's under $5 million. I just wanted to clarify. Is that what you're suggesting that it should be?

M. McLachlan: Correct. The issue there is around the audits and how the audits are conducted, specifically to PST.

Up next we have Vancouver Island University Students Union. We have Sherry and Patrick. Welcome. Thank you very much for coming today. The process is that we've allotted ten minutes for the presentation. I'll give you a two-minute warning if it looks like you're going to be broaching that. Then we have five minutes for questions or comments, and as you can see, we're using every minute of it.

P. Barbosa: Yeah, that's nice. That hasn't been my previous experience, presenting to the committee, so it's great to see.

D. Ashton (Chair): Yeah, I'm a bit of a slave driver, they say. Thanks again for coming today.

P. Barbosa: Maybe I'll just start. I'll just introduce myself. My name is Patrick Barbosa. I'm a recent graduate of Vancouver Island University, and I'm staff at the Vancouver Island University Students Union.

S. McCarthy: I'm Sherry McCarthy. I'm the chairperson for Vancouver Island Students Union, and I'm a current MBA student at Vancouver Island University.

First, I would like to start by thanking the K'ómoks people for allowing us to meet on this traditional territory.

I bring a message of greeting and hope from 5,000-plus students attending Vancouver Island University. We are hopeful that you will recognize the importance of providing the same opportunity to access education today that was provided to British Columbians 30, 25 and even 15 years ago.

As you are probably aware, students in this province are asking for four thoughtful, important improvements to post-secondary education.

One, we are asking you to invest in a tuition fee reduction. We would encourage you to look at the dramatic increase in tuition over the past decade. These increases have led to a predictable increase in student debt, which has reached a debilitating level for many graduates.

The system of increased user fees has mortgaged the future of British Columbians and has transferred the cost of the economic prosperity for many onto the backs of the citizens who at this stage in their lives are almost unable to contribute to the economy.

I would hope that even the most cynical opponent of public services would recognize that an educated citizenry has a direct correlation with economic prosperity, and individual economic success does not happen in a vacuum. It affects all of us.

Two, the second item that students are hopeful for is that the budget will include a much-needed end to the application of interest on tuition fees. Your own budget documents indicate that the B.C. government could provide much-needed relief to thousands of voters who are already in the workforce.

This support would cost the province a small amount but would provide much-needed relief. We believe that
[ Page 1104 ]
this is a good public policy and good political strategy to provide much-needed support to such a broad group of British Columbians.

Three, there appears to be consensus within the system — from administrators, faculty members, support staff and, of course, students — that funding provided by the government is not keeping up with the cost of running an institution. Post-secondary is essential to support the government's goal of creating a knowledge-based economy.

Every single year our universities and colleges face greater shortfalls in funding and are forced to cut already lean operations. Students implore committee members to recommend an increase in the operation funding for B.C. universities and colleges.

Moreover, we ask every committee member to act as an advocate for this recommendation in his or her respective caucus and in the Legislature. We need your support to improve educational opportunities in our province. This cannot be achieved without the necessary funding to support the system.

Four, British Columbia is the only province in the entire country that does not have a comprehensive needs-based grants program. Parties from all across the political spectrum have recognized the logic of providing enhanced opportunities to students who do not have the financial means to pay for their education up front. I am not sure that I can say anything else. We are the only province in the country that does not provide upfront needs-based grants.

Our next request is fundamental to fairness in the system. There is a surprising quirk to funding for universities in British Columbia. Right now each university receives a unique per-student funding amount that in large part is arbitrary. For example, VIU receives less per-student funding than the majority of the institutions of British Columbia. We are asking committee members to consider this and recommend an appropriate increase in the funding for VIU up to the level of other post-secondary institutions received.

S. Hamilton: Thank you for the presentation. I just want to focus in on your last comments. Maybe you can blend a little perspective in terms of the numbers. You talk about VIU not being funded at the same level, so if you could expand on that a little bit for us, please.

Just to note, Vancouver Island University receives about $7,590 per student. That's more than five other institutions in the province. I don't have the specifics, and I can certainly get that for the committee, if you're interested. But the remainder of universities and colleges in British Columbia receive more per student than Vancouver Island University.

I'm sure you've probably been approached for this request by administrative groups. We're hoping that the committee and, of course, the ministry will look at a better model that provides funding on a more equal basis — at the very least, by institution.

We have several classes of institutions. We have the research-intensive universities, we have the teaching-and-learning-focused universities, and then we have colleges and institutes. So there has to be a model that reflects the cost of education. And it shouldn't be some sort of legacy where…. There really is no rhyme or reason why VIU receives less.

S. Hamilton: Okay. Can I just go to the Chair? The 17th of October — is it? — if you're going to provide any additional information to substantiate that.

D. Ashton (Chair): Thanks for bringing that up. If you do have additional information, make sure you provide it by the 17th so we can get it in our report, please. The contacts — you can just grab it, and we'll show you where to send it to.

C. James (Deputy Chair): Thank you for your presentation. Just a couple of questions.

I wonder whether the funding challenges around the differential from different universities has been exacerbated with the newness of Vancouver Island. Were there some challenges in the shift to university and whether you receive the full funding that usually occurs with the start of a university? That's one question.

My second question is just a profile of students at Vancouver Island University. Do you have more older students? Are you seeing a shift? Is there a differential from other universities as well?

S. McCarthy: I do know that at Vancouver Island University we have the highest number of aboriginal students in B.C.

P. Barbosa: Certainly, when Okanagan University College was split and UBC was handed the main campus in Kelowna, and Thompson Rivers University was granted university status, both of those institutions received a significant amount of start-up funding. That wasn't the case for any of the new universities that were created in, I guess, 2010 or 2008. So that was definitely a challenge.

What that has led to is the creation of a new style of program, if you will, sort of a second class of program that our institution has titled enhanced tuition fees. These are programs that government hasn't provided
[ Page 1105 ]
any funding for. So we have students who are taking social work on line. It's actually a largely aboriginally based program. We have higher participation from aboriginal students.

They're being charged almost three times as much as other students to provide social work. I mean, social work isn't a program where you're going to go out and make hundreds of thousands of dollars a year. This is a program that people do primarily because they're interested in public service. We think this is a significant gap in public policy.

Another example, of course, is the licensed practical nurses. In that program there was pressure from the college of nurses to improve the curriculum because it wasn't meeting the needs of the job. Rather than provide additional funding, the ministry allowed the institutions to increase tuition fees for that program.

Now we have a situation where licensed practical nurses, for their two-year program, are paying the same amount of tuition fees as registered nurses are paying in the whole four years of their program. There's really no rhyme or reason to it. It's a punitive system that we'd like to see the government address through increased funding.

M. Morris: I was unclear with the second point that you're making in your presentation here. I just wonder if you could just go over it briefly again.

P. Barbosa: Yeah. Basically, we're asking the B.C. government to follow the examples set in other provinces and to eliminate interest charged on student loans. For people who take student loans, you'll know that 60 percent of your student loan comes from a federal program and 40 percent comes from our provincial program. Right now students are paying the highest interest on their student loans in British Columbia, higher than every other province in the country.

We believe that students shouldn't be paying interest, like a credit card, on an education that really does benefit all of us, because as Sherry mentioned, economic success for an individual doesn't occur in a vacuum. That's part of a provincial strategy to provide good jobs in a robust economy. We think that that should be funded, in part, by eliminating interest.

Just on a political, pragmatic stance for the group, if you eliminate interest on student loans, you're not just giving an opportunity for students of today. You're actually helping voters from up to 15 years ago. So it does have a lot of political capital. Our old estimate on the cost is around $30 million, which, to be quite honest, isn't a huge amount to really give people a better opportunity to buy a home or to invest in a new business or to send their kids to programs to help them, like whatever — martial arts or hockey. That's why we're asking for that.

D. Ashton (Chair): Sherry and Patrick, thank you very much for the presentation.

We have an open mike — Mr. Muzin. Sir, please go ahead. Normally we would have this at the end, but we have a bit of a gap now, so if you don't mind us filling that. Thank you for coming forward.

The procedure on the open mike is you have five minutes for the presentation. There will not be any questions or comments. It specifically gives you the opportunity to speak to the committee.

F. Muzin: I'm a retiree in Comox Valley, in Courtenay here. My history is in both health care and in transportation.

A couple of things. One, I know this is an educational and scintillating process, but there might have been more people here if it had been advertised properly. There was virtually no notice, nothing in the newspapers. I find that a little bit disappointing.

Without any disrespect for anybody, I notice that the composition of the committee is not exactly gender-balanced, and I wish it was a bit more balanced. Certainly, there are lots of members in the Legislature. They could also fulfil the committee.

There's a new hospital being built not very far from here, and the government has mandated that it be a public-private partnership. I have real concerns with public-private partnerships. Basically, they're imposed by Partnerships B.C. It basically guarantees profit margins to companies for 30 years.

Whether that winds up being a good investment or not, is debatable — certainly, whether the facilities are used to the extent that is anticipated. There was a problem with, for instance, the Golden Ears Bridge, where the usage does not justify the amount of money being guaranteed — guaranteed profits.

In the case of the hospital here, as I say, it was imposed. It had to be a public-private partnership. They subcontracted out part of it, and the subcontractor subcontracted out. One of the recent subcontracts was to a company called Crothall Services. I worked at St. Paul's for 32 years, and when they decided to contract out housekeeping, they went to Crothall. They got rid of them. Crothall Services was reformed. They got rid of them. They went to Marriott.

The control over the quality of the work, the standards, is very minimal at best, because it's so much the supervising of these contracts, but the company was guaran-
[ Page 1106 ]
teed their profit ratio, and that's a big problem. Also the fact that the people working for them are not direct employees, turnover of staff, education in hygiene and infection control — it was a big problem. Yet here again we have a new hospital going in, in a few years, and the same….

These contracts are not public. They're not made public. What it actually costs us and what the public are getting for their tax dollars is unknown. I have a real concern with that level of privatization, certainly as far as the hospital goes.

We've just gone through a teachers strike, lockout. I'm not a teacher; I'm not even a parent. But I do have some concerns as to how that whole situation was handled. When you have a school board…. The school board here in the Comox Valley spent $1,000 on barricades so that temporary foreign students could continue to get educated while our own Canadian citizens and children and people that are supporting the tax base in this province are locked out or do not have access to education. To me it's absolutely unacceptable.

The school board is spending money on designing a new corporate logo. They've been at it for six months. This seems to be the priority rather than educating young people in this province — certainly, by the Comox Valley school board. That's a real problem.

I don't know what the economic advantage for temporary foreign students is. You hear in the newspapers that the universities or the schools get $13,000 a student, but you don't hear the actual costs that are incurred. When you have all these foreign students here — it's not that I'm against foreign students, but I think that our students should get priority — how much it actually costs, because there's demand on other services.

For instance, in the Lower Mainland there's a huge demand for more transportation: SkyTrain, parking, a whole bunch of other related costs. Is it really of economic benefit? There are other benefits in exchange programs, to be sure.

I'm also very concerned about the amount of tax dollars that the government is paying to private schools. I quite frankly don't understand that — why they would subsidize private education when there's a huge demand for public education. I really don't see why they would subsidize, in effect, businesses to that extent.

The other issue I want to raise is temporary foreign workers. If we're going to have a vibrant province, one of our biggest assets is an educated workforce. The film industry recognized that. They said that it's great to do business in B.C. because there's a very skilled workforce.

So why do we bring in temporary foreign workers? In a lot of cases it's cheap labour, lower taxes for the province. These people are basically indentured servants because they get threatened with deportation or all sorts of other schemes. It doesn't build a vibrant province.

Those are issues. As I say, there are many issues I have concerns about, but as retiree in this community with some experience in health care and transportation, I didn't hear a lot of the presenters dealing with those issues, and I wanted it to be in front of the committee.

D. Ashton (Chair): Thank you, sir. I'll cut you off at that. There isn't anything coming back from the committee on it.

I just have to point this out. For Campbell River's North Island Mid-Week, CourtenayComox Valley Echo, Nanaimo's Harbour City Star, Parksville's Oceanside Star and Parksville-Qualicum News, advertising started September 10, September 9, September 12, September 11 and September 9. So it was advertised.

D. Ashton (Chair): Clarice, welcome. Thank you very much for coming today. Clarice, ten minutes for the presentation. I'll give you a two-minute warning before the ten, and then we'll have five minutes for questions or comments from the panel.

C. Perkins: I want to thank you very much for giving me this opportunity. My name is Clarice Perkins, and I'm speaking to you today as a private citizen. I don't really represent anybody else. In particular, I'm speaking to you as a grandparent of six young children — four of whom are already in our school system and one of whom has already been identified as having special learning needs — about why I believe public education needs to be more of a budget priority in British Columbia.

I'd like to start by saying that I recognize that creating a provincial budget is a huge responsibility. Public money is necessarily limited, while the demands upon on it are not. There are in fact many worthy and competing interests, and compromises and hard decisions have to be made. I respect that, and I respect the people that do that.

I'm guessing that often the hard decisions about budget priorities are made based primarily on analysis of the expected costs versus the anticipated benefits and risks. But as you know, the results of a cost-benefit analysis can change greatly, depending upon how you define the parameters. What looks like a good plan in the short term, when you're only looking at the intended outcomes, may not turn out to be such a good idea in the long term,
[ Page 1107 ]
when you're looking at the bigger picture and including the unintended outcomes.

I believe that we have not been valuing public education properly. We haven't been looking at the benefits of it broadly enough, and we haven't been recognizing all the return on investment that our society gets out of it.

I believe that over the last decade we've been underfunding our public schools and that this shortfall in funding is having a significant negative effect on our schools' ability to teach and our children's ability to learn.

I'd like to go over a few of the reasons why public education is such a valuable long-term investment for our province and deserves to be made a budget priority. I have given you a little handout: "Top Ten Reasons to Make Investing in Public Education a B.C. Budget Priority." I wish this was as good as the Letterman top ten reasons, but alas, it's not going to be that entertaining. They're in no particular order except for the last point.

An educated population is the cornerstone of democracy. Our province's well-being depends upon the decisions of its educated and informed citizens. I think processes like this are examples of that. People who aren't educated don't get involved and don't participate.

Education contributes significantly to reducing economic inequality, and it's an important pathway to lifting people out of poverty. This is something that I saw every day when I was working as a public health nurse. I'm from Port Alberni. We have a lot of low-income people. We have a lot of First Nations people. We have a lot of people who haven't graduated from high school. We have a lot of teen parents. Really, education is one of the few hopes that those people see for digging themselves out of the hole that they're in.

Public education is cost-effective for taxpayers. There's a lot of research to say that every dollar spent now to ensure that a child successfully completes their education — and I'm not just talking about sitting in the room; I'm talking about actually learning something while they're there — reduces the future cost of income assistance, police, prison, health care. I mean, so much of our resources are going towards health care. Also, intervention services such as mental health and addiction services. So it is cost-effective.

Public schools are the only schools that must try to meet the needs of all students. Unlike private schools, they are not selective. They don't turn children away. Public schools have to serve children with physical, emotional, behavioural and mental disabilities as well as those who are learning-challenged and those who are gifted alongside children who don't have special needs. Our society needs to invest in all of our children, and our public schools need to be given enough resources to meet their diverse needs.

The fifth point I have here is that public schools foster interactions and understanding among people of different cultural, religious and socioeconomic backgrounds. Such understanding supports civic tolerance and stability and contributes to a favourable climate for business investment. I think that's one of the big reasons why companies come to Canada and come to British Columbia, because we do have stability here.

"Education is the best provision for old age." This is a quote from Aristotle. The future support of our aging population, which of course includes me, depends on a productive, well-educated workforce. In 2009 there were 4.7 people in the Canadian workforce for every retired senior. In 2050 there are only expected to be 2.5 workers per retiree. It's likely that the productivity of these 2.5 workers will depend significantly on the quality of the education they received in our public school system, an education that hopefully will have prepared them for lifelong learning.

Point 7 is that most of our future jobs will require at least a high school education. We're in the knowledge economy now. People who drop out of school prior to completing high school are significantly more likely to be unemployed or to earn only a minimum wage. The cost of school dropouts affects us all. People who are unemployed don't pay much in the way of taxes.

Number 8, poorly educated workers lack literacy and numeracy skills. When retraining and remediation are needed, both the employers and the consumers end up paying for it. This raises the price of products, making us less competitive. We see that in Port Alberni. We have Literacy B.C. working there to help people try to get some of the skills that they missed getting in high school.

Number 9, having an educated workforce is a marketable asset. Again, it's something that attracts people to our province. It brings investors here. A lack of skilled, educated citizens in the future will impede our province's ability to attract businesses.

My last point, the one that really speaks to me, is that children really and truly are our future. They will be the innovators, the inventors and the entrepreneurs who imagine and build our future society. Their development and their education affects all of us.

A quality education is not inexpensive, but over time a poor education will cost us all much more. I believe it's essential that public education becomes a priority for receiving funding in the next budget. Our children and our future are worth it.

The first one is that education funding for B.C. public schools should be increased to at least the Canadian average — i.e., by a minimum of $1,000 per student per year. This increase in funding would let the education system make some really needed improvements, such as making sure that class sizes are appropriate and making sure that students have all the resources that they need so that the special needs students get their needs met.

The school system then might also have enough money
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to do the educational assessments for children suspected of having special needs. Right now we are actually restricting the number of kids who get tested because the school districts don't have enough funds. In Port Alberni I'm told it's only 40 kids a year that can get an educational assessment done and that many children wait years for such an assessment. Priority is actually given to kids in the last five years of school rather than kids in the primary grades, where it would actually do the most good. To me, this is not cost-effective, letting kids rot in school.

There should be a system similar to the health care system for keeping track of wait times, for determining when requests for assessments were made and when they're actually done, with a set standard for how long this should take. I believe that all assessments should be completed within a year of being requested.

Ensure that all public schools have equal access to the necessary books, supplies, equipment, technology, etc., reducing the disparity and inequality that's now found between have schools, in neighbourhoods where the PACs are able to raise a lot of money, and the have-not schools in low-income neighbourhoods where parents cannot afford to do this.

I am very cognizant of the difference in these schools, because I have children who live in Victoria in a very, very fancy neighbourhood, Oak Bay. I've been to that school and have seen what they have. Then I've been to Alberni Elementary School, which, to me, is in a shocking state of disrepair — and lack of resources. It's really appalling, this difference between the have and the have-not schools. Education is supposed to be equal. It's supposed to be equal opportunity.

In order to pay for this increased funding to public education…. People have asked me if I personally am willing to pay more taxes for this. Yes, I am, but I don't think it should be necessary to increase personal taxes. We have some of the lowest corporate tax rates not just in Canada but in the world. I believe that we need to raise corporate taxes by 1 percent and that the government should stop subsidizing private schools.

My final recommendation is that I would like to see complete transparency regarding education funding in this province. I've been trying to find out from the Port Alberni school district exactly how much money they have and how it's being spent, and so far I'm getting stonewalled. Nobody will tell me. I think the government funding provided to each school district should be made public, along with the resulting individual school board budgets with the details of how the money is being allocated to each school.

In addition, the amount of privately raised funds through PAC fundraising should also be made public. I've read one article recently which said that well-off schools can easily raise five times the amount that less well-off schools can. The difference between $10,000 and $50,000 a year is significant.

I'd like to end this presentation with a quote from Benjamin Franklin. He understood the correlation between education and its significant return on investment. He said: "An investment in knowledge pays the best interest." We cannot afford to not properly educate our children.

S. Gibson: Thank you for the passion in your presentation. I appreciate it. I taught in the public university system for many years, and my wife was a school teacher in the public system. I just wanted to pick up a little bit on a couple of your points.

With regard to private schools, maybe to elaborate a little more. In a free society, people have options. I know you're talking about how the funding of private schools should be discontinued. One of the attractive things for government in any society is the fact that when all of the schools….

The capital, when you drive by a private school, has been paid for by the parents or by supporters. That's an attractive feature and actually ultimately benefits the public system because those schools have been built by supporters, whereas in the public system, of course, all of the capital has to be provided.

You're familiar with the paradigm that it's 50 percent operating based on a formula of a local school district. I don't know whether you want to comment on that. I just didn't want to let that hang, because that is often a criticism of private schools: "Well, the government is funding them." But it's only 50 percent operating. There are millions, perhaps billions, of dollars in fixed assets that their capital has been funded not by the taxpayers, not by you and me, but by supporters, which is a good thing for the government.

C. Perkins: Well, my comment on that would be that that's true. However, every child…. You know there's economy of scale, and every child that leaves the public school system decreases the economy of scale that you get. You lose that.

My other comment would be that the private schools are very selective in who they take. They not only take the kids whose parents have got money, but they also take the kids who meet their particular definition of what they want their school to look like, whether that be religious beliefs or fundamental beliefs about the necessity for reading and writing, or whatever it is.

They don't take those challenging kids. They don't want the behaviourally challenged. They don't want the
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learning-disabled. They don't want the physically disabled. You are concentrating the typical, normal kids and leaving the difficult, challenging kids for the public school system, and I don't think that that's recognized.

G. Holman: Clarice, thanks for the presentation. Thanks for taking the effort to come out today. Really thoughtful. You made some interesting points, particularly around productivity.

Typically, governments think about incenting productivity through the tax system. But you make a very good point that obviously it depends on the education and the skills of the workforce as well and identifying your conflict of interest as a senior. I am now a senior as well. I have that same conflict about…. Productive workers are going to be able to support us in our dotage.

If you don't mind, would you share a little bit of your background. I was impressed by your presentation and just wondered. You don't have to if you don't want to, but just curious about your background.

C. Perkins: Well, my background is that I am the daughter of teachers. My husband is a college professor. My daughter is also a teacher in Port Alberni in elementary school. My own background is I have a bachelor's degree in biology. I have a bachelor's degree in nursing. I have a master's degree in leadership.

My last position was as a public health nurse in Port Alberni, working with some of the disadvantaged populations. We had some pretty extensive programs to try to reach out to, particularly, young families, the teen moms, the people living in poverty, to work with them on their parenting skills and advocate for them.

G. Heyman: Thank you very much, also, for your thoughtful presentation. I have two questions. I think I have two.

The first one. I was just looking at your first point — our province's "well-being depends on the decisions of its educated, informed citizens." We're seeing a bit of a trend towards streaming in the education system — preparing people, focusing education very specifically on job-related skills, whether they're industry specific or trade specific.

I'm wondering if you can comment or care to comment on your thoughts about the other aspects of the education system that prepare people to be citizens.

C. Perkins: Well, when I went to school back in the long, long ago, there were three streams back there as well. There was the vocational, there was the secretarial and then there was the academic stream. I believe that starting in grade 8 we had choices as to which electives we would take and which way we would go. Some of the vocational training was very hands-on. I mean, the kids did cooking, they did shop, and they built things. They did automotive mechanics and all that kind of stuff — all of which is quite expensive to do. I believe quite a bit of it has been dropped from our current high schools.

The emphasis has been largely on that academic stream, the people that were going to go to college, which is unfortunate, because when you make school all about those strict academics, I think you lose a lot of people's interest.

I personally like the idea of giving kids more options as to what to study. I think that the province does need more tradespeople, more business people. We don't just need university-educated people. But I think that the risk with that is making the choice too early, judging people too soon. I mean, I've heard from some people that they're going to be making changes in kindergarten to befit people who are planning to be working in LNG plants when they're graduated, which of course is ridiculous.

Again, I think that the diversity of courses that are being offered in our schools has been cut back severely from when I went. It's made it less attractive to kids, and anything that we can do to give them more choice is a good thing.

G. Heyman: This is just a comment. You've made a couple of references to return on investment, the Benjamin Franklin quote. We're certainly capable of doing our own research. It sounds to me like you've done quite a bit yourself. Any studies you've come across that demonstrate that, if you were to send them to us by October 17, then they'd be part of the official record of the committee hearings and be useful.

C. Perkins: It was sort of last minute. I only found out about this two days ago.

Marine Renewables Canada — Dr. Campbell. Welcome, sir. Thank you for coming today.

C. Campbell: Thank you for the opportunity. I'm sure you're all very pleased to get the kind of presentation you just got. I'm not sure the current one is going to live up to quite the same standard. I think Clarice is obviously your reward for what you're doing over these weeks.

D. Ashton (Chair): Sir, we have ten minutes for your presentation, and I'll give you a two-minute warning just in case, but the floor is yours.
[ Page 1110 ]

C. Campbell: I am Chris Campbell. I actually have an honours degree from the University of Wales, a PhD from Newfoundland. I've worked in France, Newfoundland, B.C.

I've worked in fisheries, aquaculture, offshore oil and gas, ocean technology and now renewable marine energy. I've had experience working independently or as part of a 120-person engineering marine geology company. I've been vice-president of a post-secondary institution, and I've also run my own start-up company — not very successfully, I would add, on the last. Probably the biggest failure in my life, but certainly a learning experience. I have had roles advising government, federal and provincial, on fisheries technology and energy matters.

I'm here, really, as the founding executive director of Canada's renewable wave, river and tidal current industry association. We're about 100 members that include some governments, the utilities, technology developers, project developers, researchers and others. Since 2011 we've published a strategy to try to secure an economic and energy opportunity for Canada out of our resources in the rivers, in the oceans.

In B.C. we have about 25 members that include B.C. Hydro, University of Victoria, city of Campbell River, several energy technology developers and a number of companies looking at project development opportunities on this coast. In the past we have been involved with the B.C. government in things like the development of the Clean Energy Act, the Electricity Climate Action Working Group, the marine planning partnership, the BCUC long-term transmission plan process that was begun a few years ago.

Recently we've been engaged with a few people in the government who are working on an approach, perhaps, on invigorating a marine economy cluster, recognizing that actually the clean tech and the marine economy are some of the fastest-growing sectors in the B.C. economy.

In this presentation I want to draw your focus specifically to the B.C. innovative clean energy fund as a lever for clean tech and marine renewables, as an already funded initiative and, perhaps, a painless reactivation which could be a departure point for future activity.

Briefly, I'll talk about marine renewables. We're really talking about collecting energy from the passing waves or the currents in the rivers or the tides. B.C. actually has masses of all of these resources. It's a unique region of the world where all three of those opportunities are very, very strong. We could easily double B.C.'s current electricity supply using these resources.

Many of these resources are suitable for off-grid community electrification and industrial operations, lodges, aquaculture operations on coastal areas. The distributed generation that can come from using these resources reduces the demands, the developments of the grid that we have to undertake over coming generations. Of course, these are resources that reduce our reliance. Right now we're very much reliant on rainfall and snowpack for our electricity resources.

The reality is this may not just be about energy. It may actually be more important to think about this for the economic opportunity that comes through the development of a brand-new industry. We already have companies like AXYS Technologies, ASL Environmental, Rockland Scientific, Cascadia Coast Research — all Victoria companies that are selling services into an international marketplace as people start to work on marine renewables.

The Ocean Networks Canada, the VENUS and NEPTUNE project out of Victoria are involved. We've had Clean Current Power Systems develop a technology that actually Alstom from France licensed. We have New Energy that is developing a project in Campbell River for tidal machines that has actually just recently put their smaller version of their machines in a river — two days of portage up the mountains in Nepal, a huge international marketplace for that kind of thing.

B.C. has, because of its resources, been a focus of interest for project developers from the international marketplace as well as the only project developer we have focused on marine renewables in Canada is a TSX venture company that is looking at tidal opportunities here.

We see our resources as an incubator for an industrial opportunity as much as in energy production, and we see a complementarity with the reinvigorated shipyards under the shipbuilding strategy. We do have incredible strengths in ocean sciences and technology, and of course, we do have a very clever provincial utility and its trading arm, Powerex, that we should really exploit.

To get back to the ICE fund, how can the ICE fund help in capturing the opportunities? It fills a gap in innovation finance, it supports industrial-scale but pre-commercial projects, it has successfully levered private finance by lowering the risk in the past, and it certainly has levered federal funding for innovation and development in B.C. We have had a couple of projects where ICE has invested in marine renewables. These are clear projects that mobilize the project development supply chain and stimulate innovation and technology transfer.

ICE can do more. We could have additional demonstrations of resource use and system integration, the idea of those remote community power solutions. We in British Columbia could take a very strong lead in the development of river current energy, this being a sector that Canada is particularly strong on, from the resource assessment right through technology development to delivery of projects.

Obviously, the ICE fund has advanced clean tech approaches towards the market. They will and do allow B.C. Hydro to understand the long-term opportunities, and they allow the regulators to work out how to deal with these things.
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Why are we asking you to focus on the ICE fund in these consultations, in the face of much larger questions like the education one? Well, it is a program that has worked, and it is a program that is resourced. There is actually $20 million sitting in the ICE fund. It's a program that could be grown. The example I look at over the border is Alberta's clean energy fund, which is more than ten times as big and I suspect is actually going to be grown by Premier Prentice.

There are federal innovation funds that could be levered by more activity of the ICE fund. In Nova Scotia, where a lot of our interesting activities are these days, we've seen a similar fund operated by the Nova Scotia government used as a lever to create partnership with similar innovation funds in Europe.

The problem is that at the moment it has little or no spending authority, and at this time where we're thinking about significant changes in the B.C. economy, it's worth thinking about the innovation and clean energy fund as something that should be part of the advancement of other non-renewable regimes.

We've given you a paper presentation that, hopefully, you can inwardly digest. We've included in that a number of the companies — it's basically the ones that managed to get back to me in the last couple of days — to put a face to some of the people that are involved. Coastal people look at…. Whenever we talk about marine energy, their question is simply: why haven't we done this before? They understand the energy that's there. It's an issue that really just needs us to engage, work through the difficulties of starting something completely new, and the ICE fund has played a significant role and should play a significant role in helping us do that.

D. Ashton (Chair): I might be a little bit colour-blind on this one — the blue on the blue, the very back page, sir — but maybe if we could just catch your e-mail before…. I'm sorry, I can't see it.

J. Yap: Thank you, Chris. If memory serves, in the previous ICE funds, there was at least one project that was a pilot for trying to harness electrical energy from a tidal project. I'm interested in if you know of that.

Secondly, what is the state of tidal power as a source of electric energy on a worldwide basis? Is there a jurisdiction that has already started commercial production?

C. Campbell: The answer to the first one is: there are a couple. The one closest to here is the Canoe Pass tidal project, which right now they are digging holes. I am assured that by the end of the winter we will actually have two, 250-kilowatt generating systems in there. Whether they will be grid connected is a question, because this has taken a long time. The commitment that B.C. Hydro had to help with the interconnection is perhaps a couple of regimes ago. Whether that is going to happen, I'm not sure.

On a worldwide basis, it's really interesting. We played a Wayne Gretzy trick of aiming where this industry was going. What we've done in Nova Scotia is create a situation where the tidal projects in Nova Scotia, France and Scotland — the very first ones — are happening in the next two or three years.

We are, Canada is, part of the lead of this. In Nova Scotia the government made a commitment to be part of early tidal energy development, and they instructed their regulator — their equivalent of BCUC — to establish feed-in tariffs for tidal that had the implication of raising the electricity rates as much as two percent. They committed Nova Scotian ratepayers to essentially fund the first developments in tidal to the extent of $300 million over the next 20 years.

G. Heyman: There is, as I understand it, very rapid and significant growth in technology and renewable energy. The cost of solar has gone down a lot.

This is a very interesting presentation. I recently met with somebody who had a company that had adapted U.S. space agency technology that turned much of solar energy through a system into, essentially, firm power in small installations in a very cost-effective manner. But I met with him because he was very frustrated. He's already selling through export but is somewhat constrained in his market without some development assistance.

He was very frustrated at the inability to access even the small amount of ICE funding that is available on the books.

I'm wondering if you can talk a little bit about yours or, anecdotally, others' experience in trying to get money from the ICE fund in its current curtailed format.

C. Campbell: There is little or nothing that is possible now, because the allocation they're allowed to spend is essentially taken by existing projects. There is no opportunity for new projects under the current regime.

G. Heyman: And you're convinced that the return on investment could be quite high?

C. Campbell: Especially since this is the only real tool we have in B.C. to lever any of this. So it's the first piece.
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G. Holman: Just quickly. A really interesting presentation. I would like to take up a conversation at some later date.

Just to play devil's advocate, though — although, I think we can chew gum and walk at the same time — B.C. is blessed with very low-cost hydroelectricity. We now have a rather large surplus of electricity.

I believe that the research…. Proving up the technology is a good thing to do. But in terms of actually producing power at a competitive price, that's where I, perhaps, part ways a little bit. I wonder about the return on investment versus, say, a comprehensive conservation program for electricity. I wonder if that's a lower-cost alternative.

That doesn't mean I don't support research to prove up new technology. I just wondered about your comment on that.

C. Campbell: Well, George's comment that the solar prices have dropped dramatically is the same sort of thing — maybe not the same rate, because of the more industrial approaches, but we will see a reduced cost in wave and tidal energy over the next couple of decades, for sure.

I think we have to be extremely careful. Electricity infrastructure takes a very, very long time to build, and for us to look at the surplus in 2014 and make all our decisions based on that is downright crazy. British Columbia exists today based on the decisions to build the dams back in the '70s and '80s. The quality of life that we have in British Columbia today is based on our grandfathers' decisions, and if we make decisions in 2015 that are simply based on current conditions in 2015, we will regret it in 20 years' time.

We have a ten-minute presentation allotment — I'll give you a two-minute warning — and then five minutes for questions. Please, the floor is yours.

My name is Rob Botterell. I'm a lawyer, and I live in Sidney. I managed not to get a speeding ticket this morning.

By way of background and context for my talk, I was the financial comptroller for the TD Bank in B.C. in the '80s. In the '90s I was the senior government official responsible for B.C.'s freedom-of-information legislation, and for the last 20 years I've been representing First Nations and, more recently, local government. The views I'm expressing today are my own and are not necessarily those of my local government and First Nations clients.

I want to thank you for the opportunity to make this presentation, and I also want to extend my thanks for the terrific amount of time and effort that goes into this committee's work on your behalf. I've been on committees before, and I know that it's a long, hard road. But I also want to emphasize that this committee's work is vitally important. I believe that you are the keepers of the public's confidence in the budget planning process, in large measure by virtue of the opportunity you give people like me to present information and consider it.

I'm here today to talk about the pending Site C decision and the budget and fiscal implications. This project will be the biggest public infrastructure project in the next 20 years if it proceeds. It's estimated currently to cost $8 billion, which would increase the provincial debt by over 10 percent, although we don't have accurate information on costs, so it could well be more than that.

Time is short. By my calculation, I will be reviewing $800 million of government spending every minute, so I would ask you to please review the materials that are in your kit, all of which is in the public domain. Further to the previous presenter, I would encourage you in particular to have a look at the report on energy alternatives, in the right-hand side of the folder, which covers many of the items that were discussed just now.

I'm not going to deal with First Nations issues, but I do want to say that those who suggest that the courts will somehow pay less attention or do less to protect treaty rights, such as those of West Moberly, as compared to proven aboriginal title of Chilcotin, are mistaken.

While it's true that B.C. has a triple-A rating, it's also true that there are some storm clouds on the horizon. In May Moody's gave B.C. a negative outlook due to the accumulation of provincial debt.

It's my submission that it's hard to understand how, if we can avoid part or all of it, adding $8 billion to the provincial debt helps to reverse that negative outlook. I think that's a critical consideration in terms of the work. I'm sure you're hearing many presentations on how taxpayer-supported debt could be used to provide much-needed infrastructure. I really encourage you to think about that as I make my presentation.

What would happen if you were going to the bank to borrow $8 billion for Site C and the question came up "Well, is Site C needed?" The answer you would have to give is that the joint federal-provincial review panel concluded that the need for Site C has not been established. If the next question was, "How much is this go-
[ Page 1113 ]
ing to cost?" you would have to say that the joint review panel concluded that they didn't have the information, time or resources to determine whether the $7.9 billion cost is accurate.

If you were asked, "How much would B.C. Hydro likely forecast Site C losing in the first four years of operation?" you'd have to say that the joint review panel forecasts that it's going to lose $800 million. And then the bank officer might say: "Well, what other alternatives were looked at?" You'd have to say that the joint review panel was either prohibited from considering or did not have the information to sufficiently explore geothermal, wind, run-of-river hydro and other renewables, excepting power under the Columbia River treaty or burning natural gas to provide power.

"Oh," you might say, "that's interesting. What did the joint review panel have to say about natural gas?" Well, this is what the panel said. "Finally, if it is acceptable to burn natural gas to provide power to compress, cool and transport B.C. natural gas for Asian markets, where its fate is combustion anyway, why not save transport and environmental costs and take care of domestic needs?"

Then you might be asked: "Well, how much could the government save in taxpayer-supported debt by using natural gas?" Some $6.5 billion is the likely savings. How much a year? One expert — the information is in your kit — says that currently you could save $350 million a year in operating costs to produce the same amount of electricity.

What about greenhouse gas emissions? If you're saving $6.5 billion in capital and $350 million a year in operating, you've got room to buy carbon credits. So what should we do? What did the joint review panel recommend? "Well, it should go to the B.C. Utilities Commission." What's been the response of the Minister of Energy and the Premier? "Well, the B.C. Utilities Commission doesn't have the capacity to look at it, and we're going to have KPMG do a little bit more research."

My submission to you is that doing some KPMG research now that hasn't seen the light of day, that won't see the light of day if it ever sees the light of day until after a decision on Site C is made, is no substitute for a B.C. Utilities Commission open and transparent and accountable review. Those are key commitments of this government and previous governments.

I'd submit that if the government decides to disregard the adamant opposition of First Nations, it's fiscally irresponsible, particularly for an $8 billion project, to proceed without first referring this to the B.C. Utilities Commission so they can do the homework that the joint review panel said still needs to be done. If KPMG has done some internal work, that can go to the Utilities Commission and save the Utilities Commission some effort.

We have the time. The joint review panel said that we don't need power till 2028. And they did take into account LNG, contrary to Minister Bennett's submission.

So here we are. We've got a huge opportunity here to get this right. What I would like to urge every one of you to do is to think carefully about what your constituents and the people that you've heard from during these hearings would like you to do. What they'd like you to do is to make sure that the cost is accurate, so that we know what's going on and we're doing this in the least costly way possible.

In the consultation document there's a key phrase here, in terms of taxpayer-supported infrastructure: "It is important to build needed infrastructure, but we need to limit our borrowing and keep debt affordable."

From my perspective and in my submission, the right thing for this committee to do is to recommend that this matter be referred to the B.C. Utilities Commission and, if capacity of the B.C. Utilities Commission is at issue — after all, they reviewed Site C before, so they know what they're doing; they're set up to do this — that you recommend that the funding be set aside in next year's budget to provide for a full, expert and independent review by the B.C. Utilities Commission.

This isn't $800,000. This isn't a mortgage for my house. This isn't a mortgage. This is $8 billion at a minimum. What if it turns out to be $15 billion? I wouldn't want to be in your shoes if that review hasn't been done.

What's the harm in doing the homework? Maybe the Utilities Commission will come back and say: "You know what? Site C is the best." But everything in your folder and everything we've seen over the last few months suggests that we need to have a thorough look at this before making a final decision and that it shouldn't be something rushed into.

I want to thank you for hearing what I have to say, and I'm happy to answer any easy questions.

M. Morris: Rob, I may have missed it in your introduction there, but who do you represent? Who are you advocating for or on behalf of right now?

R. Botterell: I'm advocating…. This is my personal presentation. I made that clear. I'm not here on behalf of my clients. All of the materials in your package are in the public domain and have been released, and that's where I got them.

M. Morris: Okay. I see a lot of references to the district of Hudson's Hope in your material as well. Are you working for Hudson's Hope?

R. Botterell: Hudson's Hope is a client. I'm not representing Hudson's Hope, but all of the information that is in your package has been released publicly by Hudson's Hope over the last three or four months.
[ Page 1114 ]

G. Heyman: Thank you very much for a thoughtful presentation and for the material, which I think we'll all review. I think everybody can agree around the table that we have an interest in clean, low-carbon energy.

You made a number of points. I think Clean Energy B.C. recently released a report that indicated ways in which a range, a portfolio, of renewables could supply an alternative to the energy that would come from Site C. I think the Minister of Energy and Mines indicated that he, at least at this point, was not committed to a final decision and was interested in reviewing that.

One of the obvious advantages, I would think, in looking at a portfolio of renewables is that there's the ability to bring power on line incrementally as technologies get both less expensive and more efficient. I'm wondering if you're aware of any other studies that we might want to review with regard to that, or that the B.C. Utilities Commission should review.

I think your point that the BCUC is the right place to provide some overall review, including taking input from private consultants, is certainly one that people in the opposition share.

R. Botterell: Well, there's the study that's in your kit, which highlights some options to look at and which is an initial review there. Certainly the Clean Energy Association has come up with a package of opportunities.

The difficulty with the approach that's been taken so far is that all of that study work and background working papers, unless it's been leaked, is not available publicly and has not received the type of public scrutiny. If I were a private corporation…. I've worked with the TD Bank for a number of years, and I've dealt with large corporations. If I were going to go out and spend $8 billion, I would want to give it a whole bunch of scrutiny. If it's the taxpayers' money, I'd want public scrutiny.

The short answer to your question, I think, is that that's why we need to have the B.C. Utilities Commission look at this study and other studies and subject it to proper scrutiny. It may well be that a combination of renewables or geothermal or buying under the Columbia treaty is the best option for British Columbia taxpayers. But we need to have that discussion in an open, accountable way.

Like you, I don't see a downside, really, to referring it to the Utilities Commission, which was mandated to do this kind of work. The very first thing they do is look at the demand for power and whether in fact the power is needed. As you indicated, they've already come to some preliminary conclusions around that. But, you know, to be done in more detail….

I just wanted to point out one thing. One of the alternatives that the JRP identified to Site C, or at least in terms of a possible mix, is conservation. It's kind of a little bit of a pet peeve, but it's what I was trying to indicate to the previous presenter as well.

R. Botterell: I would not want my comments to be taken as an exhaustive list of options. And I would not want my comments to be…. I was using natural gas as an illustration of something to look at. You'll see in the study that there's a whole section on enhanced demand-side management, and that could well provide a good part of the solution.

J. Shin: I'm a rookie politician, so this question may be a little naive for me to present here. But the way that you have presented the case, obviously, and the concerns that you address very well…. Why would there be a resistance from the government side to proceed with your recommendation if it's been expressed that way?

R. Botterell: Yeah, I mean, that's a very good question. I don't have an answer for you. My view is that the time is there. There's no immediate need. And in fact there's every reason for this size of expenditure to take all the time you need, because you don't get a second chance.

Access to on-line versions of the report of proceedings (Hansard)
and webcasts of committee proceedings is available on the Internet.

Chair:	* Dan Ashton (Penticton BC Liberal)
Deputy Chair:	* Carole James (Victoria–Beacon Hill NDP)
Members:	* Eric Foster (Vernon-Monashee BC Liberal)
	* Simon Gibson (Abbotsford-Mission BC Liberal)
	* Wm. Scott Hamilton (Delta North BC Liberal)
	* George Heyman (Vancouver-Fairview NDP)
	* Gary Holman (Saanich North and the Islands NDP)
	* Mike Morris (Prince George–Mackenzie BC Liberal)
	* Jane Jae Kyung Shin (Burnaby-Lougheed NDP)
	* John Yap (Richmond-Steveston BC Liberal)
	* denotes member present
Clerk:	Susan Sourial
Committee Staff:	Sarah Griffiths (Committees Assistant)

Witnesses:	Sue Aldous (Parksville-Qualicum Lyme Disease Support Group)
	Patrick Barbosa (Vancouver Island University Students Union)
	Rod Bealing (Executive Director, Private Forest Landowners Association)
	Rob Botterell
	John Bowman (President, North Island College)
	Dr. Chris M. Campbell (Executive Director, Marine Renewables Canada)
	Drew Cooper (PacificSport Vancouver Island)
	Andrew Gower (Comox Valley Chamber of Commerce)
	Dianne Hawkins (President and CEO, Comox Valley Chamber of Commerce)
	Danielle Hoogland (Comox Valley Lifelong Learning Association; Hornby Island Educational Society)
	Sherry McCarthy (Chairperson, Vancouver Island University Students Union)
	Manley McLachlan (President, B.C. Construction Association)
	Fred Muzin
	Clarice Perkins
	Martin Petter (President, Comox Valley Lifelong Learning Association)

1) Comox Valley Lifelong Learning Association; Hornby Island Educational Society	Danielle Hoogland
	Martin Petter

3) Comox Valley Chamber of Commerce	Dianne Hawkins
	Andrew Gower

8) Vancouver Island University Students’ Union	Sherry McCarthy
	Patrick Barbosa

REPORT OF PROCEEDINGS(Hansard)

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REPORT OF PROCEEDINGS
(Hansard)

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FINANCE AND GOVERNMENT SERVICES