Finance and Government Services — Issue No. 109 — Thursday, October 6, 2016 (HTML)

Present: Wm. Scott Hamilton, MLA (Chair); Carole James, MLA (Deputy Chair); Dan Ashton, MLA; Robin Austin, MLA; Eric Foster, MLA; Simon Gibson, MLA; George Heyman, MLA; Jennifer Rice, MLA; Jackie Tegart, 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	2691
S. Smith
M. Scott
J. Bateman
L. McGuire
H. Permut
D. Luster
J. Abney
H. O’Hara
G. Dirom
R. Conte
K. Peacock
R. Ens
R. Driediger
M. Dekovic
J. Roscoe
J. Coolen
K. Evans
D. Stathonikos

S. Hamilton (Chair): Good afternoon, everyone. My name is Scott Hamilton. I’m the MLA for Delta North. Welcome to Delta, for those of you who are not from here. I’m the Chair of 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 public consultations on the next provincial budget.

The consultations are based on the budget consultation paper that was released by the Minister of Finance. The committee must issue a report by November 15, 2016, with its recommendations for the 2017 provincial budget.

The committee is holding a number of public hearings in communities across the province, and British Columbians can participate via teleconference, video conference or even Skype. There are numerous ways to submit your ideas to the committee. British Columbians can complete an on-line survey or send written, audio or video submissions through to our website, which can be found at www.leg.bc.ca/cmt/finance.

We invite all British Columbians to contribute to this important process. For those of you in attendance today, thank you for coming out and participating. All public input will be carefully considered by the committee as it prepares its final report to the Legislative Assembly. Just as a reminder, the deadline for submissions is midnight, Friday, October 14, 2016.

Now, today’s format will consist of presentations from registered witnesses. Each presenter will have ten minutes to speak, followed by five minutes for questions from the committee. If time permits, we’ll also have an open-mike period at the end of the meeting. Five minutes are allotted for each presenter at the open mike. If you wish to speak, please register with Susan here.

Today’s meeting will be recorded and transcribed by Hansard Services, and a complete transcript of the proceeding will be posted on the committee’s website. All of the meetings are broadcast as live audio via our website.

S. Hamilton (Chair): Thank you, everyone. Also assisting the committee today are Susan Sourial, here to my left, from the Parliamentary Committees Office. And we have Michael Baer and Amanda Heffelfinger helping us out, with Hansard Services. They’re here to record the proceedings today.

Without further adieu, I will go to our agenda and welcome the B.C. Government and Service Employees Union, Simon Kelly, Megan Scott and Stephanie Smith.

Good evening. Thank you for being here. We appreciate you taking the time out of your busy day. You have ten minutes for the presentation, as I mentioned, and with a couple minutes left, I’ll try to get your attention. Conclude your thoughts, and we’ll go to the committee for questions. The floor is yours.

S. Smith: Thank you, Chair. Good afternoon, and thank you very much for the opportunity to speak with the committee today. My name is Stephanie Smith, and I’m the president of the B.C. Government and Service Employees Union, which represents more than 70,000 men and women in all aspects of government service, the broader public sector and the private sector.

Our submission today reflects some of the key priorities of our members who provide public services to British Columbians and who also live and work in communities across the province. In addition to my presentation today, we have provided the committee with a detailed written submission that provides statistical support for my comments.

A common theme that is advanced by the British Columbia government holds that B.C. leads the country in economic growth and job creation and that their low taxes and fiscal sustainability policies have made our province the envy of the nation. We understand that a government must present a positive message to the public.

However, I believe that the government’s message is missing an important qualifier. B.C. is the envy of the
[ Page 2692 ]
nation — for some. For those at the top of the economic ladder, that may very well be true, but for the other 80 percent, that’s not always the case.

I was interested to note that British Columbia’s motto, translated from Latin, is “Splendour without diminishment.” I’m here to make the case that many British Columbians have indeed been diminished by the very policies of low taxes and fiscal sustainability that the B.C. government claims is so beneficial to our citizens.

While we are one of the richest provinces in the nation, we also have one of the highest poverty rates in Canada. More than one in five B.C. children now live below the poverty line. B.C.’s basic social assistance rates — some of the lowest in the country — have been frozen since 2007. B.C.’s minimum wage continues to be amongst the lowest in Canada, despite recent small increases.

At the same time, the cost of living in British Columbia continues to soar. Metro Vancouver is experiencing a housing crisis. Rental rates and housing prices are, quite literally, through the roof. The cost of child care makes this essential service unattainable for many families.

More than a decade and half of continued cuts to public service have yielded predictable results. Our correctional facilities are overcrowded and are growing more violent. Our prisons are increasingly housing inmates with mental illnesses, following a lack of investment in mental health services.

Fewer seniors are able to access professional home support services, causing increasing pressure and costs on our acute care health system.

Homelessness in our cities and rural communities remains a significant issue, despite modest efforts to provide social housing initiatives.

Looking to the environment, provincial government action on climate change has been rolled back. A legacy of weakened environmental regulation and oversight has left a new generation of British Columbians facing greater environmental risks.

For many British Columbians, these conditions are hardly worthy of envy. Much more needs to be done to provide necessary services and opportunities for those who have not benefited from the advantages available to those at the top of the economic ladder.

We believe it’s time to chart a different course in British Columbia. We urge the government to take steps to accomplish three main objectives: quality jobs for all British Columbians within a vibrant, inclusive economy; reliable, effective social supports for families and communities; and effective protection for our environment and natural resources. We’d ask the committee to adopt the following recommendations.

Implement a comprehensive poverty-reduction plan for British Columbia that includes raising the minimum wage to $15 per hour and keeping it indexed to inflation. Currently, up to 500,000 British Columbians live in poverty. Raising the minimum wage will provide an infusion of spending capital into the economy, raise health outcomes and lift thousands out of poverty.

Increase funding, staffing levels and service delivery in the Ministry of Social Development and Social Innovation. We urge the government to reopen closed offices, re-establish full operating hours and increase front-line staff to provide an effective level of in-person service. We also urge the government to increase all social assistance rates, allowing recipients to live healthy, dignified lives.

Continue reinvestment in services for vulnerable children and families, building on the recent move to increase operating funds for MCFD and front-line staff, and improve services for aboriginal children and their families.

Increase funding for community-based health programs through expansion of home support, mental health and addictions services. This would allow more people to live productive lives at home and relieve pressure on our hospitals and our correctional facilities.

Significant investment in low-income housing strategy. The recent announcements of funding for social housing is a good start, but some estimates show a need to create at least 2,000 new housing units per year to address the housing crisis.

Implement affordable, quality, $10-a-day child care. Any poverty-reduction strategy would be incomplete without addressing the critical need for quality child care services. With the average annual cost of child care exceeding $16,000 in Vancouver, many families can’t afford to properly care for their children, which provides a significant drag on the provincial economy. Child care is one of the most effective ways to reduce poverty and to allow women to fully participate in our economy.

Make critical investments to address the ongoing crisis in B.C.’s justice system. Funding for B.C.’s system has seen an effective funding cut of 5 percent over the last 15 years, when adjusted for inflation. Courthouses and correctional facilities were closed in 2002. Staff-to-inmate ratios have spiraled from 20 to 1, at the beginning of the government’s mandate, to now, in some cases, more than 70 to 1.

Our correctional system has become a high-cost surrogate for missing mental health and addictions services. Fully 56 percent of all offenders have been diagnosed with a substance-use issue or mental disorder.

Continued cuts to our legal aid system, even with recent small increases, have severely restricted low-and middle-income people’s access to the system. There can be no real justice for our citizens without access.

Five years after the Auditor General report on our community corrections system, the government still has not fully implemented the recommendations. Prison overcrowding, unmanageable caseloads for community
[ Page 2693 ]
corrections staff, compromised safety and lack of administrative support has caused high levels of stress, staff turnover and burnout.

Recommit resources for climate action and natural resource management. Since 2001, B.C.’s “dirt ministries” have seen staff cut by almost 30 percent. That’s more than 1,600 jobs. And they’re responsible for natural resource stewardship and environmental protection.

A report by the B.C. Ombudsman in 2014 found that only one in five environmental assessment reports related to riparian areas were being reviewed and fewer than one in 20 site visits were conducted, concluding that this is not a reasonable level of oversight.

On climate change, the B.C. government has also pushed off greenhouse gas reduction targets to 2050 and frozen the carbon tax — basically, ensuring we cannot credibly meet our emission targets.

We believe the B.C. government should take measure to: (1) reinstate annual increases to the carbon tax, increasing to $50 per tonne by 2020-21; and (2) make the carbon tax less regressive and no longer revenue-neutral. This can be done by raising the Low Income Climate Action Credit from $115 to $308 per year and introduce clawbacks more slowly.

To support the priorities, the BCGEU recommends the government explore options for additional revenue opportunities, including increasing income tax for high-income earners, restoring the 13.5 percent corporate income tax rate, eliminate costly oil and gas subsidies, reform B.C.’s carbon tax and strengthen revenue opportunities in the Liquor Distribution Branch.

In summary, our written proposal contains more detailed analysis and additional recommendations. The BCGEU continues to challenge the B.C. government to implement meaningful revenue improvements in key areas of the economy to reduce poverty, improve public safety and expand responsible environmental stewardship in our province.

S. Hamilton (Chair): Thank you very much. I appreciate that. We’ll go to questions.

It’s an issue that we certainly…. You mentioned it as one of the areas for improvement — the area of more personalized service, more offices reopened. It’s an area we hear a lot about from clients. But I wonder if you could talk a little bit about the pressure that staff are facing.

We hear it in our MLA offices from clients who can’t get an in-person appointment or have to find the Internet somewhere, and they’re living in poverty and they’re struggling. I wonder if you could tell us a little bit from your end about staff’s issues with that.

And then the other one I was curious about is strengthening revenue opportunities. I wonder if you could tell us a little bit about that.

S. Smith: In terms of the office hours, closures and going to a more centralized call centre model, it has caused a great deal of challenge for our staff in terms of continuation of services. We hear from front-line staff on a regular basis that being able to walk down the hall and speak to someone within MCFD or someone who is a resource provider is no longer available to them.

Call wait times are extremely long. You must have a daytime telephone. Many people clearly who are recipients of social assistance don’t necessarily have access to that. So we’ve started to see a lot more aggression within our offices, particularly if there are delays in providing very vital services — you know, immediate 24-hour sorts of food vouchers, housing vouchers, those sorts of things.

In terms of increasing revenue opportunities, the committee may be aware that the BCGEU is currently involved in what we are calling the Responsible Retail Marijuana Alliance. We have a proposal, should the adult use of marijuana be legalized by the federal government, that we use our current liquor distribution system and retail stores, both private liquor stores and public liquor stores, to provide socially responsible sales for the adult use of marijuana.

Certainly, I know anecdotally that there’s a great deal of research that shows that the revenue opportunities are good.

D. Ashton: Stephanie, Megan, Simon — thank you very much for coming today. Great to see you again. I want to thank each and every one of you, and your peers, for what you do for all British Columbians. You do make a huge difference.

I’m just curious. Have you costed out recommendations 1 through 4 for us? Just ballpark. Because I think, Simon, you had given us…. Were you here last year?

D. Ashton: I thought there were some figures flying around. I was just trying to…. I don’t need them right now, but I would be just curious about if you had costed out what the proposals might total up to.

M. Scott: Certainly. You know, it’s ballpark figures, and it’s a matter of what decisions government decides to make going forward.

To return the justice system to the funding levels that it was at in 2001, particularly in the areas we identified — court services, corrections and legal aid — it would be in the $170 million range. The dirt ministries — $400 million would get us back to those sorts of levels.
[ Page 2694 ]

In total, a comprehensive poverty reduction strategy is a much bigger expense — in the $3 billion range, in some of the estimates. Including…. You know, a universal child care system is expensive but, ultimately, self-financing.

D. Ashton: We did have somebody come forward, and they said the initiation was about $1.2 billion. They figured it would go down to about $200 million after about four or five years. I could be off a year or so with that.

M. Scott: Right. We see those costs as being worthy investments, especially given the costs of poverty continuing. There have been estimates of the costs of poverty in B.C. being in the range of $8 billion to $9 billion a year. When you factor in policing, health care, all of those costs — lost productivity…. So our perspective is that that’s money well spent.

D. Ashton: It is a generational change, though. It’s not something that you can click and do.

Again, I just want to thank you for bringing this forward. It gives us something to have a good look at. Thank you again.

R. Austin: I have a couple of questions. I don’t expect the answer here, but maybe you could look through data, if you have it, and send it to us prior to October 14, midnight, which is the cutoff.

Two things. You were just asked about the dollar figure of some of these proposals. I was wondering whether you could look at the percentages in terms of GDP change from 2001 and today, and put those figures…. Estimate them from dollars into percentage of GDP so that we could have a comparison as to what things were like in 2001 and now.

My second question is around resources for MCFD in northern British Columbia. I hear from a lot of people who have interaction with MCFD and from social workers that there is, for want of a better term, a crisis going on in attracting staff and getting them to stay in northern British Columbia. In spite of the increased moneys that have gone into hiring new social workers, I still hear — for northern B.C. in particular, because of its remoteness, etc. — that there is a crisis in the offices and that between staff turnover and people being burnt out, it is really difficult to have coverage.

I wonder if you could send me some stats on that, just so we have an idea of what’s going on in that ministry.

S. Hamilton (Chair): Thank you. I’m going to take that on notice, if you don’t mind. I’m sorry, we’re completely out of time. But if you could respond with the answer to that question. If you need to have it repeated, you can go onto Hansard and find out verbatim what it was Robin just said. Before the 14th at midnight. Sorry, but we are out of time. We have a full agenda today.

S. Hamilton (Chair): Thank you very much for taking the time. Enjoy the rest of your evening. Enjoy Delta while you’re here.

Next we have Jordan Bateman, Canadian Taxpayers Federation. Mr. Bateman, good evening. I think you know the routine.

I always follow your work on Hansard. I feel a little bit like this committee is like taking a drink from a fire hydrant, so on behalf of British Columbians, thank you for being willing to stick your face in the water and take a drink.

S. Hamilton (Chair): Well, thank you for that. On behalf of the committee, we appreciate hearing that once in a while. The floor is yours.

J. Bateman: The Canadian Taxpayers Federation — we’re a non-profit, non-partisan organization. We’re dedicated to three things: lower taxes, less waste, more government accountability. That’s what frames all the work we do.

There are people like me all across the country. In fact, we finally became a truly national organization this year when we hired a new director in Quebec. That thrills the folks at Radio-Canada because now they don’t have to listen to me talk in English; they can actually call him and talk in French.

We always appreciate the opportunity to present our views. I tried to make the package a little bit smaller this year — the information. There are a number of outstanding recommendations from previous years, but I want to highlight three main points today.

The first has to do with the debt. For the past four years, despite all the operational budget surpluses, British Columbia has continued to slip further into debt. If you do the math, it looks like about a $4.7 billion surplus over the past four years. But the operational deficit from the term before that was $5.1 billion. So even just comparing that, we’ve slipped $400 million further into debt, let alone all the capital borrowing that’s gone on.

Debt in 2006 was only about $33 billion. It was trending in the right direction. Then the recession happened. Now, today, we’re around $67 billion, headed towards $70 billion. That’s about $2½ billion in interest payments.

One thing I wanted to talk about and one thing we’ve been talking about with our supporters a lot is that government debt is not like…. It often gets compared to homeowners having a mortgage. You know, we need to
[ Page 2695 ]
borrow money to have this wonderful infrastructure for the future. That is not actually the greatest analogy. Quite simply, homeowners need to borrow because — especially for those of us who live in the Lower Mainland — a home is several, often many, times our annual income. That, of course, is not the same with government. Government has a $45-billion-a-year budget. There is room for priorities and flexibility.

Likewise, homeowners have to make monthly payments. If any of us default on a payment on our home, the bank starts calling. If we default on two, they start really calling, and they often can foreclose, take away the house. Government, of course, does not have that same problem. No one’s coming to seize our hospitals or our roads or our schools if we don’t pay that. So there is a big difference between government debt and household debt.

From our point of view…. We survey our supporters every year. Their number one priority, even ahead of cutting taxes, is always to pay down the debt. They just do not feel good about leaving government debt to the next generation, to their kids and grandkids, to have to deal with.

We hear more now about their concerns around flexibility — future governments having the flexibility to react to what’s going on at the time. When we take out government debt today, we’re actually making choices for future governments, and things may be different in the future. A lot has changed in the last 30 years; a lot more is going to change in the next 30. You don’t want to tie the hands of future governments to be able to respond to the needs of tomorrow. So debt is our first thing.

The second, and it’ll come as no surprise to those of you poor souls who’ve been on this committee for years listening to me, is the Medical Services premium tax. This is easily our most loathed tax at the Canadian Taxpayers Federation. We’ve been fighting this for a long time. I know there have been a lot of different views expressed on it.

In 2010, it cost me $114 a month. Every month I write the cheque — or now I do the on-line banking — for my family for the MSP tax. Today it’s $150. That’s a 30 percent increase in just five or six years.

Last year we actually recommended a freeze to the carbon tax. It took the government a while, but they finally took our advice on that. Better late than never. Part of the reason we wanted a freeze last year was we wanted to dig in to more about the MSP, because it’s one of those taxes that we don’t get a lot of proactive information on. You’ll hear lots about income tax and certainly lots about property transfer tax and where it’s coming from. We don’t really know a lot about where MSP is coming from.

Through some freedom-of-information requests, we uncovered a few interesting facts. First of all, 850,000 MSP payments are at least 31 days overdue. That, I think, is a sign that this is a tax that a lot of British Columbians find burdensome. It adds to the cost of living. And $340 million in bad MSP debt has been written off in the past five years. Again, that’s money that the government has tried to chase down and hasn’t been able to collect.

The cost to collect the MSP was $77 million in 2015. That’s up nearly 40 percent in two years, and I wish I could tell you why. The truth is we have no idea why, because we don’t get that kind of information through our FOI request. But those are some numbers that are concerning to us, because they show trend lines: more people are late, more people are defaulting, and it’s costing more and more to collect.

We’ve talked before about the unfairness of the tax. I’m not going to go through all that. Our big push, again, is to find a way to eliminate this separate tax system. Roll it back. It’s expensive to collect. Obviously, right now the government is in surplus, so there is a little bit of financial flexibility.

Government itself is a huge payer of MSP on behalf of all of its employees. We’re not sure how much, because again, we don’t get that disclosed to us. But there are some savings there. Not to mention….

We talk about different school boards. You’ve heard many of them talking about a funding crisis. What’s the one thing they almost all complain about? MSP increases, and they don’t get more money from government to cover them. That, again, would give them some financial flexibility — health regions as well. Municipal governments — wouldn’t it be great to give them one less reason to raise our property taxes every year, by not having to pay MSP on their staff?

We think there are some opportunities there. With the CPP increase coming…. I know that’s not a provincial program, but that’s a big payroll tax that’s going to increase. The ability to offset that with a decrease somewhere else would be good for employers.

Then the last thing. It’s a little more nebulous. Essentially, it’s beware the federal government spending spree. The federal government, obviously, is going into massive debt to address various things — some good, some bad.

But we felt it was important to have a recommendation in there to really examine every project that they come forward to fund, because not every project will align with British Columbia priorities. It’s better to say no to a capital windfall if it’s going to save you operational money down the road for something you don’t really need.

I’m not confident. Certainly, the last federal government had a stimulus spree. Some of that money was not wisely spent. The same could happen with this federal government.

We’re just encouraging every mayor we talk to, every politician at the provincial level we talk to…. Just because the federal government comes with a cheque doesn’t mean you need to take it, if it’s not for the right project
[ Page 2696 ]
or the right thing. So having a little bit of wisdom, being smart about looking at their plans and looking at the operational implications of staffing and running those facilities down the road.

That’s pretty simple for this year. There are other things in the package. Last year we presented you a report on food and beverage taxes, sugar taxes — how they’re not all they’re cracked up to be. That certainly is borne out with some of the newer research coming out of places like Denmark, which was the first country to bring in a sugar tax and the first country to get rid of it. If that pops up again, I’m happy to again provide you with that report through email or other means.

S. Hamilton (Chair): Okay. Thank you very much for that. I will go to questions.

G. Heyman: First of all, just to clarify for the record, at one point when you were talking about the MSP tax, you talked about the government finally freezing the carbon tax. I assume you meant MSP.

You said that the provincial government shouldn’t go after federal infrastructure money unless it was the right infrastructure. My first question. I’m interested in what you would consider to be the right infrastructure, especially in light of your past activity with respect to the transit referendum.

My other question is to do with MSP. You talked about how government could be relieved of the responsibility to pay MSP premiums on behalf of employees, although arguably that would depend how the replacement of that income was structured.

As I’m sure you’re aware, a lot of employees — I think it’s somewhere around 40 percent — have their premiums paid for by the employer. As I’m sure you’re also aware, generally, when you get one benefit that can be monetized, you get it at the expense of another benefit, which is often wages.

Do you have any ideas about how, in any transition to a different kind of system, it can be fair for government employers, individuals who pay it out of their pocket as well as people who paid it indirectly by receiving it as a benefit, as opposed to wages?

J. Bateman: On the federal infrastructure, really taking it project by project…. I mean, the Conservative stimulus program was a bit of a mess. You know, really questionable projects were funded — gazeboes come to mind, things like that — so make sure that it’s actually a necessary project.

On the specific TransLink one, TransLink came and asked for a sales tax. The TransLink mayors asked for a sales tax. They weren’t willing to put a single dollar of efficiency towards the $7½ billion plan. Now they’ve gotten their first round of funding. They’ve managed to do it by finding almost a quarter-billion dollars in savings — selling property they didn’t need and using it to actually move people places, which I think is what we want the transit system to do.

We can talk about the mayors and how they should offset their property tax increase and stuff like that, but generally, much better than the first approach. I can’t give a blanket: “This is a good project” and “This is a bad project.” You have to take it project by project, but make sure that the infrastructure money is actually being used for things that are necessary, not things that are designed to make Ottawa politicians look good.

On the second one, this is the big problem. You’re right. We think it’s 40 percent that are enrolled in an employer plan. We’re not clear, though, how much of that 40 percent are government workers and how much are private sector workers. So again, there’s a bit of an issue there. That is the biggest hurdle, I think, second to the collection contract, to get rid of the MSP.

For us, we’d suggest…. Look, MSP, I believe, is a taxable benefit. I don’t get it, so I’m not sure if it’s a taxable benefit or not, but we believe it’s a taxable benefit. There would be some tax savings, we presume, if people didn’t get it. Maybe that can be used to offset. Certainly, things like that have to be negotiated out. I’m not even sure if some government contracts may actually anticipate something like that. But if a tax ceases to exist, you’ll have to negotiate with the individual units to make it fair.

C. James (Deputy Chair): Just to follow up on that, Jordan, I wonder…. There are different models. In some provinces, it’s done all through the tax system. In some provinces, it’s like a business payroll tax as well as an individual income tax system. I just wondered if you’d looked, at all, at any of the models. Was there a preference? Was there a direction that you’d take a position on?

J. Bateman: We would prefer it to be all in the income tax system, with all of the corresponding savings taken off the top. We think that’s probably the fairer route.

Payroll taxes are a drag on job creation, so we need to be really careful about putting any more costs on employers, especially when you hear from other groups that want to increase minimum wage — and living wages and things like that. There has to be some sort of relief for the employers who are creating the jobs in this province.
[ Page 2697 ]

S. Hamilton (Chair): Any further questions? Seeing none, thank you very much, Mr. Bateman, once again. Appreciate you coming out. Have a good evening.

Next we have FIOSA-MIOSA Safety Alliance of B.C. — Lisa McGuire. Welcome. Good evening. Thank you for coming. Ten minutes for the presentation, and when you’re done with that, five minutes, say, for questions. If you’re ready, the floor is yours.

FIOSA-MIOSA was our former name. We incorporated under the Manufacturing Safety Alliance of B.C., so with the material that you have, that’s our new name. We’re a provincewide, industry-led, industry-funded organization that provides health and safety support to over 3,000 manufacturers in British Columbia. We incorporated in 2007.

Some of the members are well-known brands — Canadian Springs, Sunrise Farms, SunRype, Canada Bread, Peller Estates. We started out serving all of the food processors in 2007, which is about 12,000 manufacturers in British Columbia, and then expanded to serve other areas of manufacturing in 2010.

Our goal is to partner with B.C. industry leaders to achieve cultural change that ensures safe workplaces for all employees.

In seeing some of the results from the members that we’ve worked with…. They’ve seen an overall decrease in their premiums in 2016, by over 7 percent, compared to the rest of manufacturing, which saw an overall increase by 1 percent. I’m very proud of industry for these results, because a reduction in premiums is a reduction in injuries, and it builds sustainable, strong organizations.

How we impact change. Our primary goal is to help organizations build health and safety systems to the OSSE standard, which stands for occupational safety standard of excellence. Why? It’s because OSSE-certified companies have been known to have better performance than non-certified companies. Once a health and safety system is put in place managing health and safety risks, we see reduced premiums, which are a reflection of reduced injuries and the costs associated with them.

How do we help? We help employers by building training programs, both on line and on site. We develop resources and tools. In the latest survey, especially to small business, they’ve let us know that resources and tools are most important to them. We also establish programs, such as having shared health and safety professionals amongst the pool of employers and on-site advisory services. We have a team of health and safety professionals that come out on site and help support employers in building good systems.

With the work that we’re doing, combined with many others, we have seen an increase in the demand for qualified health and safety professionals for the industry. With that is an impact to the manufacturing industry in having enough health and safety professionals to support them. We see an inconsistent health and safety curriculum across the educational institutions across B.C. — it’s actually beyond our borders, in other provinces — and a limited practical component within the curriculum to support that profession. There’s a generalist diploma. Health and safety graduates require additional certification requirements for manufacturing, because they have different types of risks than other sectors.

With that, we have been working with the Ministry of Jobs and completed phase 1 of a labour market study, with the goal to identify the future demands of the manufacturing sector in health and safety. So we’ve put forward a workplan for phase 2, which has been very helpful in finding enough health and safety professionals for the manufacturing industry. It’s important to help them.

I’d like you to consider some key messages: to provide more funds to post-secondary institutions across the province so that they can qualify more diplomas in occupational health and safety; to consider providing more funds to the Canada–B.C. job grant training program; to allow employers across the province to invest more money in the greatest asset, which is people, because skilled workers are safe workers; and to continue to fund the labour market studies to provide a research-based approach in making decisions to invest in post-secondary institutions for B.C. to fill the gaps in skills training and jobs to support our economy.

S. Hamilton (Chair): Thank you very much, and I will take questions from our panel here.

G. Heyman: Currently, how many graduates per year would there be from post-secondary institutions with occupational health and safety diplomas?

L. McGuire: BCIT currently graduates…. Well, there are 25 positions to fill within that curriculum. That’s the only diploma program, to my knowledge, in B.C. It’s not a lot.

C. James (Deputy Chair): Just to follow up on that, if you were looking at expanding the seats, is there a priority? Or would you have a preference around expanding the seats, perhaps in a northern university or again in the Lower Mainland, to increase the spaces?

L. McGuire: I think we really need to look beyond the Lower Mainland, because certainly, manufacturing and other industries expand beyond that. It would be nice to have the opportunity to have diploma programs across B.C., both in the Interior and the north.
[ Page 2698 ]

This is a big, big task, really. It’s a big picture. How do you kind of evaluate or measure your success on an annual basis? What are your criteria when you’re looking back on your year and saying: “Okay, we’ve made progress here.” How do you do that?

L. McGuire: We have a number of key performance indicators that we look at. We actually measure the success of our engagements with the company that we’re working with, and we measure the injury rate to see where they are. We have targets to reduce that — to reduce injuries on site. That is one way. We have about 13 of them. But there are various…. That’s one of the key performance indicators.

We have targets to engage others in terms of increased awareness, and then we have qualifying customer feedback surveys and things like that to see how successful we are at performing outreach and then whether or not we’re meeting the demands with the right tools and resources through that survey and consultation approach.

S. Gibson: My experience in manufacturing, at least, is that sometimes the people that most need the guidance are the ones that resist it. If you want to make a comment on that or not.

L. McGuire: Yes, and certainly, there are challenges in getting them to understand the value of health and safety and how it integrates with their business. Sometimes it takes unfortunate incidents to get them to realize how important it is.

We have specialists within our organization that go out in engagement, to talk to them about looking at the financial impact to their business and how important it is for them to invest in their people. Quite often, in many cases, that’s successful. But where we’re unsuccessful, well, you know, there’s WorkSafe B.C. and the regulatory path. That makes it difficult, certainly — we’re a volunteer organization — to help support them.

Thank you very much, Ms. McGuire, for coming by and sharing your thoughts and giving us an update. We appreciate it. Enjoy the rest of your evening.

Okay. Next, we have the Real Estate Board of Greater Vancouver — Harriet Permut.

How are you? Welcome. You more than likely know the routine. I’m going to give you ten minutes for your presentation, and then we’ll go to the committee for questions. If you’re ready, the floor’s all yours.

S. Hamilton (Chair): You know what? We hear that a lot, and before you know it….

I’m Harriet Permut, government relations manager from the Real Estate Board of Greater Vancouver. I’m here today to talk to you about a few issues: (1) the vital role that home sales play in our communities; (2) how the property transfer tax makes home ownership less affordable; and how thoughtful application of property transfer tax revenue could make homes more affordable.

First I’ll give you some background about the real estate board. The board represents 13,000 licensed residential and commercial realtors and their clients: property buyers, sellers and owners in greater Vancouver. Our board boundaries extend from Pemberton in the north to Tsawwassen in the south, from the Gulf Islands and the Sunshine Coast in the west to Maple Ridge in the east. We operate the Multiple Listing Service, and, using MLS data, we produce statistical reports used by business, industry, government, economists and universities.

Real estate and construction together produce 26.5 percent of the province’s GDP and 238,000 jobs, making these sectors the largest job creators in B.C.’s economy. On the housing side alone, more than 42,300 homes were sold on the MLS in greater Vancouver in 2015, generating $2.7 billion in spinoff economic activity and 19,000 related jobs.

The new foreign buyers tax is affecting this activity, as you know, which brings me to our first recommendation. For future changes in the PTT, we advise government to exempt transactions already underway. We’ve heard from many buyers and sellers who have lost deposits and sales all over the province, not just in the Lower Mainland. Instream transactions should have been exempted.

For our second recommendation, we’re asking the government to increase the 2 percent PTT threshold to $525,000 from $200,000 and then index the thresholds of the various PTT-related exemptions using the MLS home price index, as outlined in our third recommendation. This will give growing families the opportunity to trade up, maybe from a small apartment to a modest townhome, to better suit their changing needs.

For recommendation 4, we’re asking the government to use PTT revenue to help increase the supply of family townhomes around transit stations by providing financial incentives to municipalities that fast-track project approvals.

For recommendation 5, we’re asking the government to help increase the supply of smaller market homes by using PTT revenue to provide financial incentives to municipalities to permit the sale of laneway homes and the stratification of secondary suites. Right now these are only allowed to be rented.
[ Page 2699 ]

I want to stop for a moment to emphasize that our recommendations involving revenue expenditures are carefully considered. Please keep in mind that the September revenue forecast, which the Minister of Finance just delivered, for fiscal year 2016-17 for the PTT is $2.2 billion. This is well in excess of the government’s budgeted figure of $1.2 billion, which is still a shocking amount. The government can well afford to invest some of this windfall revenue in programs to improve housing affordability for all homebuyers and renters — not just new homebuyers, not just first-time homebuyers, but all homebuyers, who actually are the ones who make most of the purchases in this province.

Back to our recommendations. Our final recommendation. We’re asking the government to negotiate with the federal government to reinstate private investment programs to improve the supply of purpose-built rental housing, similar to those programs from the 1960s and ’70s — the MURB program, just for the sake of argument — that produced the large stock of rental buildings in the Lower Mainland that we still enjoy today. Unfortunately, many are rapidly reaching the end of their economic life and need replacing or upgrading.

S. Hamilton (Chair): You caught me off guard there, to tell you the truth. Nevertheless, there may be some questions. So I’m going to go….

We heard a lot about this, after the changes were implemented. There’s no doubt about it. It’s very topical. Obviously, people feel differently, whoever you talk to. You can walk down the street. Everybody has a different opinion.

I want to ask the committee if they have any other opinions or questions they’d like to share.

With regard to the property transfer tax, the numbers were, as far as the provincial coffers go, very nice. There’s no question about that. The revenue generated by realtors on that type of a market is substantial. We looked at the numbers a while ago, just the average, if you take all the realtors and all the sales. Obviously, it’s not equal. Some people work part-time; some people work double time.

E. Foster: I realize that. But I also realize there’s a tremendous amount of money being made in the real estate business in greater Vancouver.

There are a whole lot of different ways to make housing more affordable. It always seems to be coming back to government to make this happen. One of the issues, too, in fairness, is there are — whatever number — a thousand units right now waiting for permits to build in the Lower Mainland. That’s a huge challenge.

Markets are driven by supply and demand. There’s not enough supply. Therefore, the demand is higher, and the price goes up. That’s the main…. If you had extra houses on the market, the price goes down. They’re no different than anything else.

H. Permut: That’s why we’re recommending a few supply-driven recommendations. Taxation does not make houses more affordable, particularly. Supply does, at this point in the market. Like you say, there’s a shortage, so you need more supply to balance the market out again.

E. Foster: What I’m saying is: other than the real estate industry and lots of others coming to this table and asking us to give them money…. Where’s the investment coming back?

We changed the rules, as a government, because you had some people in your industry, not many of them…. But your industry wasn’t dealing with them. It’s a long story, but that’s the reason. If your industry had dealt with this problem, we wouldn’t have had to change the rules.

H. Permut: We have 13,000 members, just our board. There are probably about 22,000 in the whole province. We’ve had a handful of cases.

The Real Estate Council is sanctioned by the government. It’s appointed by government, basically. It functions under government rules. We don’t disagree that changes to the system are useful, handy. We are supportive of them. We will help implement them. That’s not an argument. We’re not arguing with the government on that. Government is well within its rights to be making changes to the system. We approve of that. We absolutely do.

E. Foster: I’m very glad to hear you say that. Every single realtor that’s come into my office has said exactly the opposite.

H. Permut: Well, they’re not listening to what their board is saying. We take a different view.

E. Foster: I appreciate that. I’ve got that on the record now, and I can hand it to them.

H. Permut: We’ve said it in public. I can give you press releases, one after the other. We are welcoming the appointment of the new real estate superintendent, and we will work with him to implement the recommendations
[ Page 2700 ]
that were made. We are doing that. We are in the process of doing that.

With respect to commissions, realtors are earning a living. They provide extensive services and good knowledge to save customers money and to make sure they don’t fall into legal holes that they really don’t need. That’s what they’re getting paid for — to provide a service. I don’t think there are many people who would work for free. People think they should. Well, it’s a bit odd.

Like I say, estimating commissions is almost impossible. We couldn’t do it. We don’t keep track of that information. Some of that changes at the end of a transaction. We have no idea how much they’ve earned. We don’t track that. We have no way to do it, so I don’t know how anybody else calculates it, particularly. It’s an interesting extrapolation. It’s something we have no evidence for.

H. Permut: A great many realtors don’t do a lot of deals. It’s the 80-20 rule, right? That 80 percent of the money is made by 20 percent of the people. A lot of realtors don’t make very much money at all.

H. Permut: Some of them do. Some of them don’t. That’s their business. That’s their choice.

H. Permut: Yes, they do. Absolutely, they do, and they bring a lot of value to the transactions that they’re part of. Most people know a lot of folks like that.

I’m not justifying what people make for a living. I wouldn’t do that for too many professions — to say: “You deserve what you get.” I think they work very hard. The people I know certainly do. I’m sure the people in your community that you talk to are good people. They do their job properly, most of them, I would imagine.

C. James (Deputy Chair): Thank you for your presentation. I like the phrase “gentle density.” I haven’t heard it used before.

C. James (Deputy Chair): I wondered. You mentioned financial incentives for municipalities. What kinds of things have you explored, or what kinds of areas have you looked at? You hear of municipalities often looking at this issue, but I haven’t heard anybody talk about incentives to encourage it.

H. Permut: They don’t usually talk about it. Usually the problem for municipalities — especially in Vancouver but not just Vancouver — is they just don’t have enough staff to move the process along as quickly as they’d like to.

Now, Vancouver is a very complicated planning system, more than anywhere else. They have more rules and regulations, depending on what you’re trying to do. They really don’t have enough staff to move the practices along, to get to a decision. If a little bit of incentive money could be given for fast-tracking projects, then maybe that would help them hire more staff to add to the system, to keep it moving.

There are some municipalities that are very good at this. They sort of create like a Nexus line. If there are developers or builders who are known to be building very standard projects — nothing fancy; they follow the rules — and they have a good track record with the municipality, they kind of go to the fast lane, because they don’t put stuff in that’s complicated. They don’t need to wait the same length of time. Some municipalities have done a very good job of that, and that’s a good way to get some very regular kind of homes onto the market fairly quickly. Any kind of homes, whatever type of project — townhouses, whatever it is.

Some municipalities, like Vancouver, often have some very complicated projects. It’s going to take a lot more time. But if they could at least give the respected and good builders the ability to move ahead on some of their projects, at least, I think this stuff would come to market a lot faster. There’s a lot of money wasted waiting for projects to get built, for no reason, really, other than the city just can’t process the paperwork.

If there’s a way to get a bit more money to the city to hire more staff, that would be great. It’s coming out of the real estate system if it’s coming out of revenues from property transfer tax. It’s coming out of the industry, basically, one way or another.

S. Hamilton (Chair): If I could add. Delta, where we are now…. I know we ran into that problem at one time and actually contracted out city planners, people to help with the approval process, and got rid of the backlog.

S. Gibson: A quick question, adding to my colleague’s original query. What do you think is the role of your members in reducing the cost of home-buying? What is the role of your members in reducing that cost? That’s my question.

H. Permut: I think if municipalities would consult with our members in their local communities a little
[ Page 2701 ]
more frequently…. We try to encourage members to join committees and consultation exercises that municipalities already create. There’s a lot of knowledge about the community, about the building practices, about the need, about the market and what’s needed in that community. If there would be a bit more consultation, I think our members would have a fair bit to say and a fair contribution to make to the decision-making of a local government.

There are a lot of decisions that are made. Sometimes you just shake your head and go: “You know, why didn’t they talk to us or someone local from the area?” Who knows the area? I don’t know anybody who knows a community more than the realtors do. They’re out and about every day. They know the streets. They know the people. They know the needs. They know what people are looking for and what they want and who’s moving in.

I think they could contribute a great deal to moving that process along and to providing housing that people actually want to buy in the community, and they could probably do it cheaper. They know what people will be willing to accept in terms of standards or the kinds of finishes or the types of homes that are saleable in that community. They could actually move it along quite a bit. Some municipalities do better at this stuff than others.

H. Permut: If you have any other questions, you know where to find me. We’ll be happy to….

S. Hamilton (Chair): Yes, I appreciate that — a very relative and interesting discussion.

Moving on, folks, we do not have the Rick Hansen Foundation. Apparently they’ve cancelled. We do have now the Pacific Hepatitis C Network, and Daryl Luster is with us. Mr. Luster, good evening.

S. Hamilton (Chair): Make yourself comfortable. Relax. You know the routine about the ten minutes, right?

Some of you I’ve met. Some of you I will be meeting, hopefully. Scott I’ve met, Simon. Jennifer Rice — I hope to meet with you. I want to thank you for giving me this time.

It’s been a very difficult week. I don’t know how much you’re aware of what’s been happening with the Public Health Agency of Canada as of last Friday. They slaughtered probably 70 percent of the community-based organizational funding across the country. It’s pretty devastating, so many of us are organizing in groups, both nationally and provincially. B.C. appears to be hit very hard, and it isn’t specific to our organization.

We were funded up until two years ago by them. They were our core funder, with some provincial funding. It stopped, and then we started to engage in a process which has taken about two years, which changed under the Liberal government. When it took over, they decided to reinvent the wheel, I guess. We went through that process. I myself, personally, have been involved in endless consulting and meetings. They’ve engaged me in committee after committee work, trips to Ottawa, etc., all at our cost, to inform.

Now, it’s pretty apparent to me, and I think this is important on the provincial…. I’m going a little bit off-script here, by the way, because I thought this was important to say. We feel like we’ve been played, very much, particularly in the hepatitis C area.

Hepatitis C has always been and remains the ugly stepsister infection. By that, I mean the connection with drug users. It’s been very convenient to suggest that we’re all just a bunch of junkies, as some people would frame it. It’s not the way I would. I use that for emphasis and drama, perhaps.

In any case, it’s been convenient to dismiss junkies as, pretty much, trash. And what do we do with the trash? We throw it out. That’s the way I feel as a person who lived with hepatitis C.

I was diagnosed after years of being ill, quite by accident. Some of you know the story. Maybe you don’t remember it. I was sick for about three years in my mid-50s. They never thought to test me, and it was because I didn’t look like a junkie. I’m a businessman. I come from a business background. I’m still in business, albeit semi-retired.

Anyway, getting back to the federal landscape, it’s a mess. The province has stepped up this year and helped with a project that we’re engaging in, starting next month. But organizations like Positive Living B.C., which some of you may be familiar with, are defunded by the Public Health Agency of Canada.

The list is long, and I suggest that it might be worth taking a look. I certainly would help any of you, if you contact me. Currently PHAC, Public Health Agency of Canada, is sending out their apologists. I’ve heard from them today, giving us more of the same bullshit. Sorry, I’ll be frank.
[ Page 2702 ]

Now, I don’t know how much some of you know about Hepatitis C. I’ve included a slide deck, which is pretty much our current deck. I don’t really want to belabour too much of it. You can read that at your leisure. I’d rather spend a little bit more time with any questions you might have about hepatitis C. It has now surpassed HIV globally in deaths annually — by double, in fact. Some of you may be surprised at this little tidbit. Most infections in the world are caused by medical procedures.

B.C.’s Centre for Excellence — that’s Julio and company — did some research and determined that most of us baby boomers were, in fact, infected as children receiving medical procedures back in the late ’40s, early ’50s, which throws a monkey wrench in the works about drug use. But you know what? It doesn’t matter to me. It’s never mattered how anyone was infected. What matters to me is how they are affected now in their lives.

What we’re seeing now is an aging population that look a lot like me, and some of you, who are becoming more and more ill, many of whom are still undiagnosed. As many as half of the baby boomer population remain undiagnosed.

There has been no buy-in by the feds or the province, any kind of awareness or broad information made public about the need to be tested. We’re moving forward with a project, which we have a little bit of seed funding for from industry, to look at educating primary care physicians, GPs. We think, along with some of our doctor-treater colleagues, that this may be where it has to happen, in the absence of any provincial public health or federal public health interest.

As you can see, I feel pretty passionate about this stuff. I’ve lived it. I live it with the community daily. I speak to people. I have friends who have died. I have friends who are dying. We just got thrown out with the baby and the bath water. I would characterize us as feces. I’m not sure what part of that mix we are, but the feds, basically, have decided yet again, like every other government….

Oh, I should back up a little bit. The provincial Liberals, the government, last year and the year before approved new therapies and increased the numbers by about threefold, which we applaud. I’d like to see double that amount. If we’re really going to make a serious dent in this infection, that’s what we need to see.

If you have any questions, now might be the time. I haven’t kept track of time, by the way.

S. Hamilton (Chair): That’s fine. You’re well under time, Mr. Luster. It’s not a problem at all.

C. James (Deputy Chair): I guess I want to ask a little more about the impact of the program cuts that have occurred. Over the last couple of years, I have to say that the public awareness and the work that’s been done has had an impact, from what I’ve seen in my community — at least in education, if nothing else.

C. James (Deputy Chair): We’ve had a couple of good events at the Legislature. We had a testing day for baby boomers and others.

C. James (Deputy Chair): There was also a very good event, I guess a couple of months ago, again around education and informing people.

What’s the federal government’s argument, I guess, for defunding? What do they say is going to take the place for the kind of work that’s going on right now?

D. Luster: With hepatitis C, they haven’t explained anything, so your guess is as good as mine. It’s HIV-focused. HIV has, now, 30 years of activism. It’s cool. It’s sexy. It may not be so sexy to live with it, but as a cause, it has become sexy. We’ve thought that for quite a while now. Ours is not so sexy. It’s kind of dirty and nasty in most people’s minds.

They were poised, in 2014 — so that’s nearly two years now; two years this December — to release screening guidelines. That’s the Public Health Agency of Canada. December 18, 2014 — I remember the day. Mel Krajden from the B.C. Centre for Disease Control and myself had op-eds ready to go on the heels of that announcement that day. Nothing.

Time went on. We couldn’t learn anything. It was a few months before we heard from the Public Health Agency of Canada that they needed more study. The data just didn’t support it. Although we’d known it in the community, actually, for some time, this was age-cohort screening. This was people born between 1945 and 1965.

The Centers for Disease Control…. It’s 4½ years now. They made recommendations about that age cohort. The numbers aren’t really so different in Canada. I mean, they move a little bit, but not a lot different. Very different from Indonesia, absolutely, but not so much North America.

We still have no idea. There’s not even a whisper that they will, in fact, support or even make a statement about it. I’ve been in, like I said — and I’m not exaggerating — hundreds if not thousands of hours of meetings, conference calls, etc. Read endless documents, stacks of documents that are meaningless unless we act.

This last committee I was on was looking at concrete actions — to advise the Health Minister on concrete actions. Half of the organizations that were going to be in-
[ Page 2703 ]
vited to a face-to-face in Ottawa to discuss these issues are unfunded now. Do you think there is any place for that committee or moving forward with that work? I don’t think so. They’ve wasted our resources over two years. We have very little in the way of resources, I can assure you. Probably some of you earn more in a year than our total budget.

Mr. Luster, you made a comment early on, after Carole asked her question, about the testing day that we had in Victoria. You said you had mixed feelings about that. Would you like to elaborate?

D. Luster: Well, I’ve got to tell you, because of the terrible stigma around hepatitis C, most people, in my experience — I’ve talked to thousands, and I’m not exaggerating one little bit; I work on a help line and have for three years, and I talk to a lot of people — don’t disclose their status. Probably roughly 90 percent never disclose their hepatitis C status. Why is that? Because colleagues, employers, family…. People don’t even disclose to their spouses, many of them. That’s what’s going on.

So putting a person in a situation where…. I mean, if you were one of the ones who were tested, were you asked then, after the fact: “Well?”

So putting political…. It was a stunt, I believe, to be honest. I think it was a political stunt. I don’t care for stunts, to be frank.

S. Hamilton (Chair): I like to think of it as maybe trying to create an awareness, but I understand your position.

S. Hamilton (Chair): You’re suggesting, though, that at this stage hepatitis C could potentially have a greater stigma attached to it than HIV in terms of disclosure. You can go ahead and elaborate on that. That’s fine.

I think that for…. I’m old enough to have lived during the whole HIV crisis. So are you. I lost friends. My business has involved me in the interior design industry. Some of my friends were from the gay community and were positive, and some of them are gone. So it wasn’t like it was just an abstract that I read about or saw in the headlines. I lived it. I lost a very dear friend of mine.

Things changed with HIV when it was discovered that, gee whiz, women and children could get HIV. So it was no longer a gay illness. That’s when the whole sea change happened with HIV. We’re nowhere near any kind of sea change with hepatitis C.

Sure. Who do we hear about — rock stars? Well, everyone knows they use drugs. If I see another headline that says “sex, drugs, rock and roll” in the same sentence as HCV, hepatitis C virus, I’m going to barf. All that does is perpetuate the stigma.

Now, don’t get me wrong. The people who inject drugs, the community, as you can see in the pie chart, make up a percentage of the population. Probably most of you think about that population when you think about hepatitis C. Maybe not but that’s the focus. That’s the focus of public health. That’s the focus of everything to do with hepatitis C. The perception is that people who look like me or like you will just go see their doctor, and everything will be fine.

Well, friends of mine over the years that I’ve convinced to talk to their doctor about being tested have been told: “You don’t need to be tested. You’re fine.” But I defy any physician to diagnose someone living with hepatitis C, who is hep C positive, by looking at them.

With that, Mr. Luster, thank you for taking the time. It’s a pleasure, as always.

D. Luster: Absolutely. If you want to reach out for any more information, that would be great.

S. Hamilton (Chair): That’s just fine. I appreciate you taking the time. Have a good evening.

Ten minutes to present. When time is getting a little short, I’ll give you a wave. Then we can go to the committee for questions after that.
[ Page 2704 ]

We’ll bid goodbye to Robin Austin. Thank you very much. We’ll see you next week. Take care.

J. Abney: I just have a bit of a written statement. I believe you’re getting a copy of that as well, and then we’ll see if there are any questions.

Ladies and gentlemen of the committee, thank you for the opportunity to speak to you here in Delta today. I’m here to speak to the positive impacts sport can have on the lives of the citizens of British Columbia. Our provincial government has a strong history of investing in sport, and I’m here to advocate for its continuation and further investment moving forward.

My name is Jordan Abney. I’m the executive director for B.C. School Sports. BCSS, as we are commonly known, is the governing body for high school sport across the province. We are the second largest sport organization by membership in the province, only behind B.C. Soccer.

We are an independent society registered with the province. What makes us unique is that despite our very close relationships with both the Ministry of Education and the Ministry of Community, Sport and Cultural Development, we receive no direct investment from either ministry. I’m hoping to see that change in the future, and I’ll briefly highlight five areas I think would benefit immensely from the support of the provincial government.

The first area is health and wellness. The scientific research on the benefits of interscholastic sport is overwhelming. It will come as no surprise that increasing the amount of physical activity in a young person’s life will decrease the likelihood of heart disease, hypertension, diabetes, obesity and other physical ailments.

What you may find interesting is a 1999 study published in the sociological sport journal that stated that participation in high school sport is a strong predictor of adult sport involvement. The research demonstrated this trend holds true even into the 40-to-59 category, which has long-term health benefits and cost savings for the health sector.

A 2006 study at the University of Waterloo demonstrated an increased likelihood of positive association with self-concept as a result of participation in interscholastic sport.

All sports have the ability to teach life skills such as, but not limited to, teamwork, respect and discipline. School sport, additionally, has the ability to teach these skills in a safe and educational setting. Participation in school sport is also directly linked to higher academic achievement in the high school years. As well, it increases the likelihood of completing a post-secondary education.

These skills and experiences we provide for our student athletes build our future businesses and government leaders. An interesting study that you may be aware of, or maybe not, is a 2006-07 study in Alberta of all sitting MLAs and corporate CEOs in Alberta at the time. It showed a correlation. In excess of two-thirds of those people had participated in school sport, which is more than double the general population.

The second area is economic return. With the help of our member schools, BCSS runs 270 zone championships and 62 provincial championships. Student athletes, coaches, parents, supporters, etc., travel around the province to attend these events. This doesn’t even account for the numerous tournaments that people attend throughout the year just to get to and prepare for qualifiers and provincials.

The sports sector in general does a phenomenal job of providing return on investment for government dollars. My colleagues in the sector who receive part of the $7.1 million the government invests in the sports sector generate $4.95 for every dollar the government invests.

BCSS currently does not receive any of that investment, but I’m confident we could exceed this number. An example of that would be last year. We held our largest provincial championship in Nanaimo. It was our track and field championship, which has over 2,000 participants in our provincial championship. To do so, we partnered with the local government to upgrade their existing track facility in order to host the prestigious event. The event was a great success, live-streamed all over the world with 80,000 unique views, and left a positive legacy with a newly renovated track facility in Nanaimo for that community to benefit from.

The third area for your consideration is our regional reach and ability to affect community. B.C. School Sports has 448 member schools in 153 different communities around the province. Our ability to affect the lives of young people in every corner of the province is truly unparalleled, at least in the sports sector. Not only is our reach diversified to every corner, but the ability for communities such as Fort Nelson, Nakusp, Prince Rupert and others to use sport as a catalyst for community engagement is very prevalent. As you saw firsthand in 2010 and just recently in Rio, sport has the ability to bring a nation together. In these smaller communities, our schools do the same thing.

We recently had a young man, who applied for eligibility, arrive at a school in Vernon from a Syrian refugee camp. Actually, it was from a Jordan refugee camp but a Syrian refugee. The school felt that involving him in school sport would provide him some structure and some support to help him with his difficult transition.

That leads me to the fourth point — participation and inclusion. Last year B.C. School Sports had 87,679 participants around the province. A staggering one-third of all high school students from grades 8 to 12 in B.C. participated in a B.C. School Sports event.

There are nearly 6,000 coaches from both the education system and the community that support school
[ Page 2705 ]
sport. It’s estimated that hosting and coaching at zone provincial championships, our volunteers contribute over 60,000 hours a year. That’s just at the zone and championship level. It doesn’t include all the other tournaments and practices that lead up to that.

B.C. recognizes that inclusion is an important focus for our government, and we continue to be in the forefront of this area as well. We currently have para-adapted sports in track and field, cross country and aquatics. We’re currently looking to add more disciplines and more events, moving forward this year. BCSS believes in providing an opportunity for all our student athletes, and an investment would help us continue to develop this area further.

The last area I will mention is performance. School sport provides the foundation for excellence for numerous athletes. Even those that go on to perform on the world stage in a sport other than that they competed in, in high school acknowledge that the competitive flame was often lit during these years. The lessons learned in sport help them throughout their sporting careers. We are very proud that we had 31 athletes recently in Rio that had a history with B.C. School Sports.

In closing, thank you again for the opportunity to speak with you tonight. Thank you for the government’s continued support of our sports sector. It’s a wonderful investment in the people of British Columbia. I realize you have a difficult job and there are many requests from all different walks and desires. But I hope you’ll consider that the vast reach of B.C. School Sports and the uniqueness of our organization and the ability we have to impact the lives and the citizens of B.C. is a valuable one.

C. James (Deputy Chair): Thank you for your presentation, Jordan, and the work that you do. Certainly from my years on school board, I worked closely with B.C. School Sports and saw the importance of the organization.

We’ve heard it from PacificSport and ViaSport, as well, and one of the areas that I’m hearing lots of challenges about is the challenge of not having specialized teachers as you used to. You’d have a specialized designated teacher as a physical education teacher in schools. Many of those specialist teachers are gone now. People are generalists, and you don’t have the same kind of expertise.

Are you seeing an impact in school sports and in coaching with not having that kind of expertise within our schools like we used to?

J. Abney: Yeah. It’s a very good question. We are seeing the impact of…. There’s a couple different things. One, we’re having less specialized teachers, whether that’d be phys ed teachers with a coaching background. As well, we’re seeing — as a result of job action and union pressures — less teachers willing to contribute their volunteer time. Between those two things, we are certainly noticing a transition from predominantly school teachers and, over the last number of years, definitely more of a balance between community and school coaches.

We’re trying to protect the integrity of school sport — as we feel it is fundamentally different from a club sport setting — by providing more education. We’ve developed a course called “Coaching in B.C. Schools” that stresses the fundamentals of coaching but also the essence of school sport, as well, to help kind of bridge that gap.

S. Gibson: I was reading recently, notwithstanding the good work you’re doing, that increasingly, young people are becoming more sedentary. I’m wondering if you disagree with that. I think this was U.S. stats, but it’s troubling that younger people are less active, are spending more time in front of their computer and are not taking that seriously.

J. Abney: Sure. I would say that that research is probably very likely correct. I think it’s not a secret that our young adults and young people in our communities are certainly getting less activity, whether it be from a school setting or from an at-home setting, in general. That’s leading to an increase in childhood illnesses, whether that be obesity, diabetes or other things. Certainly, that is something we try to combat. Offering school sports — that’s something that we try to help support with.

What’s the role of the parents in this in terms of encouraging or nurturing the students? Is there some relationship between the participation and involvement of the parents and the involvement of the student?

J. Abney: Without looking at the actual research, I would say, anecdotally, yes. I think there is pretty strong evidence to say that if you’re an active parent, whether it be in your own sports or other activities, the likelihood of your children participating goes way up with that.

Personally, I have an education background but also coaching as well. Now as a new father, recently, it’s important for us to continue to stay active and be able to do those things as our kids grow up. I think that’s something we want to continue to see.

That leads back to that comment that participating in school sport is a strong predictor for being active in adulthood. That cycle is sort of self-feeding. If you can
[ Page 2706 ]
kind of keep people involved, then it will perpetuate further activity and health.

J. Rice: Thank you for your presentation. I’m wondering if you have any comments in regards to gender and sport. You talked about two-thirds of the Alberta MLAs and CEOs having participated in high school sport and that was more than double the average, or something to that effect. I’m wondering how much that is correlated to gender. We know that historically, MLAs are traditionally male. We’re not quite at the equity numbers we’d like to see. I’m wondering if you see any future in including more girls in sport.

J. Abney: It’s certainly an issue across the sector. Previous to this role, I was with Squash B.C., the provincial sport organization — where it’s very much male-heavy and male-dominated, really. I’m happy to say that B.C. School Sports is much closer to a 50-50 split. Our numbers in the little fact sheet that’s attached there are broken out by gender, and I believe it’s 52-48, or somewhere in that ballpark. The number of athletes male-female is quite close. Obviously, your concerns…. I can’t speak to the political field, because that’s not my expertise, but it is a concern across the sport sector, and we make sure we try to offer equal opportunity in sport for females and males alike.

S. Hamilton (Chair): Any further questions? Seeing none, thank you, Mr. Abney, for coming by and sharing your thoughts. Always an important subject.

S. Hamilton (Chair): Next we have our B.C. Association of Farmers Markets — Heather O’Hara. The folks from Mineral Exploration B.C. are a little late, so we’re going to step ahead.

Good evening. Welcome. Ten minutes for your presentation. When you get close, I’ll give you a wave and you can conclude your thoughts. Then we can go to the committee for questions after that. The floor is yours.

H. O’Hara: Very good. Thanks for the invitation to speak tonight. I’m the new executive director of the B.C. Association of Farmers Markets. I’m very excited to be joining the organization, bringing in a whole different kind of experience and what have you.

Just by way of introduction, the B.C. Association of Farmers Markets appreciates the opportunity to offer input into the provincial budget. Our association represents over 135 B.C. farmers markets, and we serve as a voice and connector for more than 1,000 B.C. farmers and over 2,000 small-scale food processors and artisanal small business vendors across the province.

We’re a connector and collaborator, and regularly communicate with a broad group of farmers, small-scale food processors, artisans, provincial ministries, agricultural stakeholders, municipalities, and community and social service agencies. The majority of our 135 market members themselves are non-profit societies comprised of volunteer boards of directors and follow an authentic “Make it, bake it, grow it” mandate, enabling people to buy local across B.C. all the time.

Some of our impact and achievements in the buy-local area. B.C. farmers markets are uniquely positioned to provide British Columbians with an ongoing opportunity to buy local, connecting consumers directly with a diverse mix of local B.C. farmers, local small-scale food processors and local artisans. This differs from other types of markets which may feature merchandise sourced from elsewhere.

In 2014 and 2015, the BCAFM was successful in our application for the B.C. buy-local program through the B.C. Ministry of Agriculture. With a goal of increasing sales at B.C. farmers markets, we ran two provincewide campaigns with provincewide media outlets that garnered over 100 media clippings and raised the profile of the B.C. farmers markets through traditional and social media, advertising and public relations.

An evaluation of vendor sales at six participating farmers markets during those farmers market seasons and buy-local campaigns revealed an almost 12 percent increase in vendor sales between June and September of 2014 and 2015. We look forward to participating in future buy-local programs sponsored by the province of B.C.

On to small business. B.C. farmers markets are a significant local economic development engine, demonstrating growth from $69 million to $170 million in economic benefits between 2006 and 2012. Our markets serve as an integral regional distribution channel for fresh local food and generate revenues — and, of course, create jobs for small business market vendors and their adjacent businesses while serving as valued tourist destinations across B.C.

To help strengthen markets’ ability to assist in these efforts, in fall 2016, our association will once again offer an awesome market management certificate program, which we developed just to strengthen local farmers markets.

In addition, we are documenting farmers market best practices, in collaboration with Kwantlen Polytechnic University, to share broadly and build capacity in the sector. We are actively exploring new collaborations, which is very exciting, with Small Business B.C., Vancity Credit Union and other agrifood stakeholders to both customize
[ Page 2707 ]
and connect more and more markets and small business vendors with existing tools and resources to strengthen both their markets and their vendors.

Community. B.C. farmers markets serve as a gathering place for strengthening community relationships and social connections across the province. We know that visits to farmers markets for people from all backgrounds, especially seniors and low-income families, foster a sense of social connectedness — a key determinant of health — and also enable people to meet and thank the farmers who grow our food.

For the seventh consecutive year, our association has celebrated local farmers through our annual Farmers Appreciation Week. Thank you to the province of B.C. for recognizing this important contribution of farmers through an official proclamation we received this past September.

Our association continues to strengthen our own farmers market sector community and, in 2016, hosted our annual AGM and conference in Kelowna, attended broadly by market boards, managers and vendors alike, with informative and practical presentations by multiple stakeholders.

Healthy living and food security. Through the farmers market nutrition coupon program, managed by our association, B.C. farmers markets are also playing a growing role as a connector and hub for supporting food security, healthy food and healthy living activities across the province. We sincerely thank the provincial government for the continued investment in the farmers market nutrition coupon program and would like to describe the impact that this program is having across the province.

Of note, B.C. is the only province in Canada with this kind of innovative programming. Supported by HealthyFamilies B.C., this initiative offers coupons in the amount of $15 per week for a 16-week period to lower-income pregnant women and their families and to low-income seniors for the purchase of fresh, healthy foods at farmers markets — including fruits, vegetables, herbs, meat, fish, dairy and nuts. At the same time, participants benefit from resources and skill-building opportunities to support healthy living choices.

In 2016, the farmers market nutrition coupon program continues to expand and today is operating in 53 communities across B.C. — from Hazelton and Fort St. John to Vancouver. To deliver the program, we partner with over 85 community and social services agencies that offer nutrition and food skills programming. Over 900 farm families and 3,000 lower-income households — equivalent to 10,000 individual residents across B.C. — are benefiting from this fabulous initiative.

We continue to build on and leverage the investment of the provincial government in this program, as we’ve successfully secure additional financial support from private donors, such as Whole Foods in Vancouver, and through new fundraising events, including a planned Barney Bentall and the Cariboo Express concert in Kelowna this November. We understand there are many, many more communities, local partners and British Columbians who will benefit from this program, and we encourage the government of B.C. to both continue and expand investment in this innovative program over the long term.

On to opportunities and recommendations. In November 2016, and with the support of a grant from the Growing Forward 2 strategic outreach initiative, our association will embark on an exciting new organizational strategic plan to guide our priorities in the years ahead. Collectively, all of our projects and programs will continue to support the B.C. government’s strategic growth plan to build and expand domestic markets and increase food security.

On to recommendations. We and other stakeholders recognize that B.C. farmers markets serve a vital role as an incubator and innovation space for emerging and existing agrifood small business in the agriculture sector. Today’s farmers market vendors often become tomorrow’s agricultural success story in B.C. Farmers markets are a critical force in the agricultural ecosystem and a local economic development catalyst.

As our association continues to collaborate and build our specialized resources, training and services to support and strengthen the viability and competitiveness of farmers market members, we welcome additional support and investment by the province of B.C. for our work in this area. Furthermore, we welcome ongoing and multi-year buy-local investment for associations and initiatives, especially those like us with a core buy-local mandate.

Interest in and demand for the innovative, one-of-a-kind farmers market nutrition coupon program is growing across B.C. Our association is proud to lead and manage this program, on behalf of the province, to support healthy living and nutritionally vulnerable food-insecure households while making an important investment in local food and farmers.

We welcome increased investment, which will enable us to both extend and expand the program beyond 2018. Farmers markets are recognized as community assets for local residents, businesses and as tourism destinations. We welcome provincial and municipal investment in local farmers market infrastructure — including dedicated and/or permanent market space, dry and cold storage, distribution and food processing capacity — to reinforce and strengthen our markets and market vendors across the province.

In many communities across B.C., especially small and remote locations with fewer vendors, there are often inadequate budgets for core farmers market operations. Farmers markets are operated by dedicated volunteers, often without dedicated paid staff. To strengthen the
[ Page 2708 ]
viability and sustainability of those markets over the long term, we welcome investment in core operational support for market management and/or event staff at farmers markets, which also increases training and job opportunities for people across the province.

In addition to serving as a critical distribution channel for local food, farmers markets provide a rich experience, showcasing local arts and culture. We invite the province of B.C. to invest in additional arts and culture funding to be implemented at local farmers markets to increase attendance and further strengthen their role as tourist destinations.

D. Ashton: The proud community of Penticton has one of biggest farmers markets around. I have to say that during the summertime — and I’m not exaggerating — there are over 5,000 people in attendance. It’s always good to see. Thank you for your help in ensuring that it continues to be very viable.

S. Gibson: Well, coming from the number one agricultural community in British Columbia….

Our market is doing really well in Abbotsford. The one area that I think is missing from your report — and it’s not a criticism — is the tourism aspect. For example, Abbotsford is right on the border. We’re only five minutes from the U.S. border. When I go to our market, I see a few Washington state plates around.

I think that’s a big area, and I’d like to recommend that maybe we can work on that with our ministry, because that’s not something, I don’t think, that you’ve really been working on.

H. O’Hara: Thank you. I appreciate that. In fact, I tried to highlight the tourist destination piece, but I think you’re right. It’s something that’s a bit of an aside or a side note.

We have engaged Hello B.C. in terms of listing farmers markets. We’re going to probably be a little bit more active in that going forward so that it becomes one of those pamphlets on B.C. ferries and all those kinds of things.

It does cost money to do those kinds of activities. But yes, I agree with you. It’s a really good opportunity.

S. Gibson: When my wife and I travel in California, they have the little stands there. They’re kind of like little markets. They, of course, have produce that we don’t have here — avocados and oranges and stuff like that.

C. James (Deputy Chair): I think that the addition of arts and culture is a very good idea. Certainly, we have music at the farmers market in Victoria. It is a tourist destination, because it’s close to downtown. But I think your point is a good one. Most people just wander by. They don’t happen to have it on their destination list. So I would encourage that as well.

I agree with your request around looking at the nutrition coupon program, looking at some kind of expansion. Certainly, we have two or three markets that have come forward to my constituency office that want to be part of the program that aren’t right now. I think both expanding the program as well as looking at the amount for a week would make sense.

H. O’Hara: We are trying to understand the demand. That’s one of the things that I’m working with staff on, to go: “Hey, how many people are asking for this that we are declining?” Sometimes it happens at the agency level, and that information doesn’t reach us. But I’m definitely really interested in the demand versus the supply side of that.

G. Heyman: Thank you very much. I know that residents of my constituency, Vancouver-Fairview, look forward to someday when you have a summer farmers market as well as a winter farmers market.

My question. I note the tremendous growth of the markets as well as the number of vendors in each market. While not all vendors sell organic produce, a substantial number do. Are you tracking the presence of the opportunity to sell, through markets, on the health of organic farming and the ability it gives more people to move into that kind of conversion and seeking of the certification?

H. O’Hara: Right now a lot of those issues are managed at the market level. Vancouver Farmers Markets is quite mature, quite sophisticated.

I’m an organic farmer here in Tsawwassen — a farming school student, actually. I’m not the real deal yet but hopefully one day soon.

That said, I know for the Vancouver Farmers Market, for example, to claim that you’re organic-certified, you need to actually show that certification and accreditation. The short answer to your question is that it’s handled gen-
[ Page 2709 ]
erally at the farmers market management and board level. But certainly, I feel like most organic farmers tend to be small-scale operations and, therefore, the more typical vendor at a farmers market.

The presence of organic farmers tends to be higher, I would say, at the farmers market. And I think that in terms of market demand, it certainly is something that consumers are looking for more and more. From personal experience, running farmers market booths, I know that that’s a really key question people have asked often: “Are you organic-certified? Do you spray?” They’re really, really interested in where their food comes from and some of those practices. I actually can speak coherently about the difference, too, just being an organic farm school student.

J. Rice: As someone who lives in a community that doesn’t have a farmers market, I’m quite envious of all my colleagues here. However, I do represent a huge constituency that does have farmer…. I live in Prince Rupert, but there are farmers markets in the Bella Coola Valley and in Haida Gwaii. There is a desire and a movement in the North Coast to want a farmers market. I’m just wondering if you had any tips or advice to help people get going.

H. O’Hara: Sure. A couple of things. I listened to the rural dividend fund webinar today, and I’m really curious about that as an opportunity for some of those regional market areas. I know we have really successful markets in the north. I think it’s just a matter of building the critical mass to make them viable and also some of those other creative funding strategies — arts and culture.

How do we start to leverage some of those other things to make them more viable as well? But they are generally really successful. Smithers. I hear Quesnel.

H. O’Hara: Terrace and everything else. We’re trying to be as regional as we can across the province as well.

S. Hamilton (Chair): This will be the first farmers market folks that we’ve heard from so far, so I’m going to go to the discretion thing again and allow a little extra time, because we might not get another one.

J. Tegart: I come from the Interior with very small communities, but farmers markets are really important, and what I’m excited about is how many young people we’re seeing becoming farmers. In Lillooet, they actually take a picture of what’s on the vine, and people order from the hub, and it’s delivered to their farmers market for them to pick up.

We’re seeing some really innovative stuff. It’s really important — the support that you provide. Certainly in Lytton, I’ve heard great numbers around people using their coupons, and it’s another way to keep the economy local. So thank you for the work you do.

H. O’Hara: You’re welcome. Just a footnote to that. You know, some of those more remote markets really rely on that coupon program to make that farmers market viable for themselves. So in addition to all the good it’s doing for people who are using them, it really makes the farmers market much stronger as well.

E. Foster: Do you hear from many of your markets one way or the other about the changes that were made to the liquor laws so that craft distillers, craft brewers and the VQA wine people could serve, do tastings and sell their product?

H. O’Hara: You know what? Basically, I’m so new that I’m just wrapping my head around that issue myself. Right now, I actually don’t know. But as an entrepreneurial kind of thinker, I do think: what role could farmers markets be playing in a bit of a hub for that more and more?

E. Foster: Well, if I could, just on that quickly. Certainly in our area, it works very well, but to be a VQA wine, a craft distiller or a craft brewer, they have to use 100 percent B.C. agricultural products, so that’s the tie-up there.

H. O’Hara: Yeah. I feel like the farmers market has an opportunity to really capitalize on that stuff. I’m just feeling a little bit uneducated about the topic, but it’s definitely on my mind around what’s possible with that.

S. Hamilton (Chair): I’ll conclude. You made a mention about…. We are here in Delta. We talked a little bit about organic farming on the heels of what George was questioning, and you were talking about it being on a smaller scale. Take you over to Westham Island, and you can talk to the Ryalls. You can talk to Harvie Snow. They are very successful larger-scale organic farmers in Delta, and there are lots of them coming on board now. As long as there is a demand, there will be supply.

S. Hamilton (Chair): The final word. I’m going to have to defend Delta from member Gibson over here.

In the heartland of the farming community, sitting right here, and you’re telling me Abbotsford’s number one? Not a chance. We’re here.
[ Page 2710 ]

S. Hamilton (Chair): Delta has two very successful farm markets now. A big one in Ladner. It’s been there for years.

All right. I’ll call on — we’re going to back up a little bit — the Association for Mineral Exploration British Columbia — Mr. Rick Conte and Gavin Dirom.

Welcome, gentlemen. Good evening. Thank you very much for being here. Ten minutes for your presentation. We’ll try to give you a warning when you get close, and then we can go to the committee for questions. If you’re ready, the floor is yours.

G. Dirom: Good evening, Mr. Chair, and committee members. Thank you for the opportunity to present. My name is Gavin Dirom. I am the president and CEO of the Association of Mineral Exploration. We go by AME these days. With me is Rick Conte, AME’s executive vice-president. On behalf of AME’s 400 corporate members and 4,000 individual members, we are pleased to provide the Select Standing Committee on Finance and Government Services with recommendations for Budget 2017.

AME represents the provincial mineral exploration and development sector, which I like to call the lifeblood of the mining industry. Clearly, without exploration, there would be no mining. But British Columbia competes in a highly competitive, open-trade environment. Mineral explorers and developers are price-takers, not price-makers, and are, therefore, subject to the basic fundamentals of global supply and demand.

The industry is experiencing one of the most extreme and sustained downward commodity cycles in history, resulting in bankruptcies, layoffs and cancelled or delayed projects. Many members of AME are struggling to stay afloat during these difficult times, even with the recent increases in the prices for gold, zinc and steel-making coal. Cutting across the entire industry is a relatively high degree of uncertainty going forward, with respect to the depth and substance of the current price increases.

Globally, overall financing for the industry dropped by almost 40 percent between 2007 and 2015, while financing for exploration has fallen over 90 percent. In addition, after years on top, Canada no longer attracts the single-largest share of total global mineral exploration budgets, conceding first place to Australia in 2015. Natural Resources Canada has predicted further investment declines for Canada in 2016.

For B.C., mineral exploration expenditures have declined from a high of $680 million in 2012 to $272 million in 2015. These figures help demonstrate that the B.C. and Canadian governments, along with industry, must continuously work together to attract investment. B.C. has hundreds of exploration projects that could be spurring more regional economic development in communities throughout the province, creating local demand for goods and services, developing and building upon local expertise and supporting thousands of family-sustaining jobs in both aboriginal and non-aboriginal communities.

B.C. does host world-class metal, mineral and coal deposits, and further discoveries are likely, but only with continued exploration. It is the junior exploration companies that often take on the highest risk in the mineral development cycle, with less than one in 1,000 making a discovery leading to mine construction. Nationally, a recent report found that over 70 percent of the discoveries made in Canada between 2004 and 2014 were made by junior companies, highlighting the importance of responding to their financing challenges.

Junior exploration companies, unlike major companies that have an operating mine and a source of revenue, desperately need to secure access to venture capital to fund mineral exploration projects, especially early-stage, grassroots projects which could begin to replenish the nation’s and B.C.’s depleting mineral deposits inventory.

Although British Columbia continues to host 58 percent of the mineral exploration and mining companies listed on the TSX and the TSX-V exchanges, the ranks are thinning. In fact, over the past 3½ years, the number of companies headquartered in B.C. has declined by 26 percent, from 962 to 708 companies.

While the drop in commodity prices and company mergers are important factors, these are not the only reasons behind these declines. Other contributing factors include costly and excessive securities regulations to keep a public company listed, increasing costs to explore and develop mineral resources, and uncertainties about mine development even after a discovery of the resources.

B.C. is underexplored and vast, covering over 944,000 square kilometres. But mineral exploration and mining in B.C. have impacted less than 0.05 percent of the provincial land base. Subsurface minerals and coal resources in B.C. are generally owned and administered by the Crown and managed in the public’s socioeconomic and strategic interest for the greater good of all citizens of British Columbia, aboriginal and non-aboriginal.

The B.C. government must ensure a leadership role in managing the exploration and development of our
[ Page 2711 ]
natural mineral and coal resources for the good of the province. This must include enabling the opportunity to access land, prospect, explore, apply modern geoscience methods and develop mineral resources in an environmentally responsible, safe and timely manner.

Given an apparent rising market, AME believes that there is a potential golden opportunity for British Columbia to take further policy steps to support the exploration industry, to attract investment and encourage mineral project development.

Therefore, AME respectfully offers the following recommendations to the select standing committee, grouped into three main categories: (1) taxation policy and market reform, (2) land access and use and public geoscience and (3) building human resources capacity.

With respect to taxation policy and market reform, AME recommends that the B.C. government make the B.C. mining flow-through share tax credit permanent, to encourage investment in mineral exploration in British Columbia.

The B.C. mining flow-through share tax credit allows individuals who invest in flow-through shares to claim a non-refundable tax credit of 20 percent of their B.C. flow-through mining expenditures. B.C. flow-through mining expenditures are specific exploration expenditures incurred after July 30, 2001, and renounced by the corporation issuing the flow-through shares to the investors holding those flow-through shares.

AME applauds the B.C. government for extending the B.C. mining flow-through shares through to December 31, 2016. We recommend that it be made a permanent incentive to encourage companies to better plan and explore for more in British Columbia, thus removing the uncertainty of a year-to-year extension.

Two, AME recommends that the B.C. government maintain the B.C. mining exploration tax credit program. The B.C. mining exploration tax credit program provides a 20 percent refundable tax credit with an enhanced rate of 30 percent for companies carrying out grassroots mineral exploration activities in areas affected by the mountain pine beetle through to December 31, 2019. AME appreciates the renewal of the B.C. mining exploration tax credit as announced in Budget 2016. This extension has provided longer-term stability to mineral exploration companies that will allow them to plan financing of multi-year programs.

Together, over a five year period, the B.C. mining flow-through share and the B.C. mining exploration tax credit incentives have provided a return on investments averaging more than 6 to 1, based on nearly $2.3 billion in mineral expenditures from 2010 to 2014.

Three, this is why AME supports the Prospectors and Developers Association of Canada’s efforts to ensure that the current Finance Canada review of federal tax expenditures leads to a recommendation to sustain the flow-through share system as well as the federal mineral exploration tax credit. We encourage the B.C. government to urgently communicate their support for this unique fiscal policy to federal Finance Minister Morneau.

AME recommends that the B.C. government work to adopt newly revised wording — as established by the federal government in the March 23, 2016, and subsequent, amendments — to the definition of “Canadian exploration expense,” also known as CEE, with respect to community consultation and environmental expenditures, in line with the recent amendments to the Canadian Income Tax Act.

AME recommends that the B.C. government advocate for the capital market’s regulatory authority to adopt regulations that improve industry’s access to venture capital — specifically by adopting a regulatory framework that acknowledges the role of capital markets in fostering economic growth and prioritizes cost-effective capital-raising by venture issues.

S. Hamilton (Chair): You can use that time however you like, but one minute is left out of the ten, so we don’t get to as many questions.

Six, before restricting exploration and development in mineral coal and mineral-rich lands in B.C., AME recommends that the B.C. government assess the mineral and coal development potential and socioeconomic impacts of any proposed land access and use policy changes and assess the potential negative impacts and unintended consequences to the mineral exploration and development sector of legislative and regulatory changes.

AME recommends that the B.C. government provide the B.C. geological survey with adequate resources to update current mapping and geological databases and develop new programming, such as identifying opportunities to evaluate the mineral resource potential.

AME recommends that the B.C. government establish long-term predictable funding for Geoscience B.C.

Turning to the human resource capacity, AME recommends that the B.C. government provide the B.C. Centre for Training Excellence in Mining with $1.2 million over a three-year period.

On behalf of AME, we thank you for the opportunity to present these recommendations. We will be making a full, written submission and are happy to take questions.

S. Hamilton (Chair): Thank you very much for that.
[ Page 2712 ]
I will go to the committee for any questions they might have. That’s quite a comprehensive submission you have there. Do you have it in writing? Do you have copies for the members here? Is it coming?

C. James (Deputy Chair): Just a question around the training issues and the opportunity for people to go into the field and to be able to address shortages that eventually may come again when the market turns around. Are you looking at…? You mentioned the money that you were asking for, for training. Is it really just for the one institute? Are you looking for training opportunities around the province?

I certainly hear…. I’ve seen some of the training opportunities that have been there for First Nations in the area of mining, which have provided some jobs in some very small, remote communities and have been very positively received. I just wondered whether there’s a specific program that you want to look at, or do you want to look at expanding around the northern areas of the province?

The specific recommendation is for CTEM, which, as you might know, is based out of Northwest Community College. They are pan-provincial in nature, though. This $1.2 million over a three-year period is specific to CTEM. We do think it would support a lot of the other programs that you alluded to.

S. Hamilton (Chair): Okay. I guess that’s it for the questions. Thank you very much for taking the time, gentlemen. Appreciate it, and look forward to maybe being able to dissect that submission a little bit. That was a lot of information there. Thank you again. Have a good evening.

Before I call our next presenter, I’d like to acknowledge that Vicki Huntington has just shown up in the audience with us. Good evening, Vicki.

If I could ask Mr. Ken Peacock to come forward, from the Business Council of British Columbia. Mr. Peacock, good evening.

S. Hamilton (Chair): Ten minutes for your presentation. I’ll try to get your attention, and you can conclude your thoughts at that time. Then we can go to the committee for some questions. If you’re ready, the floor is all yours.

K. Peacock: Thank you for the opportunity to present in front of the committee. I’ve left written copies of our submission at the desk there, so you can look at more detail there as is fit.

As we usually do at the business council, I’m just going make a few remarks about the economic backdrop as we see it. Most of you will probably be aware that we’re sort of, at the global level, mired in this slow-growth world, the U.S. being a bit of a bright light, but the rest of the global economy underperforming. It has consistently underperformed expectations.

If you look at the history of forecasts, what you see is international agencies like the IMF and the OECD coming out with some prognostications of what the global economy might look like, and then invariably three, four, five months later, they’re scaling back this outlook. We’ve seen this happen for four or five years straight. Indeed, although we don’t have a most recent update…. I think the IMF just came out with their most recent global economic forecast, and that pattern continues. I think that’s the third downgrade to their global economic outlook that they’ve had.

The Canadian economy continues to struggle amid soft global commodity prices — particularly oil, of course. It’s hitting the oil-dependent provinces particularly hard. You’re seeing unemployment rates in Alberta and Saskatchewan rise up above the national level. It’s almost unprecedented, at least in the time I’ve been watching economic data and information.

Housing markets. There’s sort of a trifurcation of housing markets across Canada. Toronto and Vancouver, of course, are doing well, though some provinces are seeing sales very soft and price declines. Then the rest of Canada is kind of flat. Non-residential investment is a bit of a weak spot as well. Some strength in exports, but of course, the steep decline in energy prices and energy exports is weighing on that.

The overall result is that we expect economic growth at the national level to be a very muted 1.1 percent in 2016, which is basically what it was in 2015. Looking for a little bit of an uptick in 2017, but that, of course, remains to be seen. We’ll need to see some recovery in the export sector, some pickup in tourism and other areas and, hopefully, some recovery in the provinces that have been harder hit by the downturn in oil.

Just turning quickly to B.C., B.C. is on a very solid economic footing, I would describe. I would note, however, that if you look at the history of B.C.’s economic growth, growth of around 2.6 or 2.7 percent, which is what we’re forecasting, is really right on the long-term average. Yes, we’re leading the country in economic growth, but it’s not because we’re having sky-high economic performance
[ Page 2713 ]
here. We’re having an average economic performance. It’s just that many of the other provinces, the previous growth stars, are in recession, so it makes us look better.

A striking feature of the economic growth dynamic in B.C. is that it’s heavily tilted towards domestic economic activity. The export side of the economy is somewhat soft. A China slowdown and a weakness in other emerging economies are having an effect. Thankfully, the U.S. is reasonably strong, and we are seeing some export growth towards the U.S., which is good news for British Columbia.

The housing market in B.C. — again, back to the theme of domestic economic activity — has, of course, been very, very strong. The remainder of this year is a little bit of a question mark, of course, because some of the froth has been taken out of the housing market. It has been slowing down, and then the 15 percent tax on foreign purchases probably caused further slowdown. If you do look at the real estate complex — construction, real estate activity and all the related stuff — it really has been a big economic engine in the province over the past three or four years.

Last year, we estimate, the real estate complex grew by about 6 percent. The remaining part of the economy grew by around 2.2 to 2.4 percent. So you really did see a big lift, getting up to 3 percent in total, coming from economic activity related to housing.

I’ll just jump quickly to the labour market. The labour market in B.C. is very, very strong, very solid. The year-over-year growth of around 3 percent is the strongest in the country. If you go across the country, you see job declines in Alberta, Manitoba, Saskatchewan, a little bit of an increase in Ontario, a little bit of an increase in Quebec. Then, out to the east coast, they’ve all seen employment declines as well. So B.C. really stands out on that front.

There is a caveat, though: it’s heavily concentrated in the Lower Mainland. If you go outside of the Lower Mainland, job growth in the rest of B.C. has essentially been flat for five years. That’s a bit of a troubling thing and something that policy-makers may need to look at, but it’s difficult to know exactly what can be done to address that.

Our forecast for economic growth in B.C. We’re thinking 2.7 percent in 2016, a slight slowdown from the 3 percent pace registered in 2015, and a similar performance in 2017.

This year we decided, in our recommendations, to kind of focus on the near term — near-term budget priorities. Part of the reason for that is we did a fairly comprehensive submission to the Tax Competitiveness Commission. So if you’re looking for more details about some long-term thinking and some long-term policies for the province, I would refer you to our submission to the Tax Competitiveness Commission.

The first one — we’ve said it before, and we’ll probably say it again in the future: aim for balanced budgets in 2017-18 and 2018-19. From the Business Council perspective, as long as the economy is in reasonably healthy shape with growth in excess of 2 percent, there’s not a lot of reason to run a deficit. We don’t need a bunch of additional stimulus. Plus, the fact is there’s a bit of a question if there’s a whole bunch of capacity in the economy right now to take on construction projects and other things, just because labour markets are quite tight, particularly in the construction area.

The second recommendation: keep the provincial net-debt-to-GDP ratio below 20 percent. It’s currently sitting around 16 percent. We suggest just having this as a target in mind. Just to keep the fiscal house in order, keep that debt-to-GDP ratio below 20 percent.

The third recommendation. To help make B.C. more productive and strengthen the innovative capacity in the province, we believe that the provincial government should commit to extending engineering education capacity in the post-secondary system and provide additional funding to make B.C. more competitive in attracting top-notch, top-flight graduate students, particularly in disciplines and fields of research related and linked to innovation activity.

Recommendation No. 4. To free up additional financial resources, we’re suggesting that the government, rather than returning the corporate income tax back to 10 percent — as there was a commitment to do — keep it at 11 percent and use that additional fiscal capacity to provide tax relief in other areas that we think would provide more lift, more benefit to the economy. Related to that, we’re thinking in particular about directing it to some relief around the PST.

Recommendation No. 5. We think the government should look at removing PST from electricity, on purchased inputs for industrial and commercial firms. There’s not a lot of…. It makes little sense to apply a consumption tax like the PST to business purchases of electricity, particularly when that electricity is generated from carbon-free resources, as is the situation in British Columbia.

Then, extending the recommendations around the PST, we think that the government should look at broadening out the exemptions on capital inputs, removing PST. This would help encourage investment. There are some exemptions currently in place related to manufacturing — capital purchase for manufacturing and other resource industries — but we believe that should be broadened
[ Page 2714 ]
out to cover all industries. We do note that the PST in this coming fiscal year will raise around $6 billion, and 40 percent of that is paid by businesses on business inputs. So there is some scope to provide some relief on the business input front.

Then, finally, recommendation No. 6. We believe that the province should keep the carbon tax at $30 a tonne. We do note that the federal government just announced its plans to introduce carbon pricing right across the country, so we suggest that we wait for other jurisdictions across Canada, as well as the United States, to put carbon pricing in place and sort of narrow the gap with what we have in place here in British Columbia, having the highest carbon price in North America by quite a wide margin.

S. Hamilton (Chair): Oh yes, you have. No doubt about it. Thank you very much for taking the time.

My question is on your closing remarks regarding productivity. I think we sometimes lament that. We look to other countries that maybe don’t have the standard of living that we have, but their folks sure know how to work hard. In our young people today, sometimes that’s an area that can be lacking.

We have, I think, the highest percentage of small business start-ups in the country, given some stats we’ve been given. Do you see a connection between the vitality of small businesses and productivity, given that motivational enterprise that people have when they have their own businesses? I’d be interested in your comments on that.

K. Peacock: Right. I think the hard reality is that larger firms tend to be more productive than smaller firms. Now, there’s a bit of a caveat there. People are often enamoured with the whole notion of small businesses and the vitality that you were speaking of. The challenge is unpacking that a little bit, because something like 98 percent of all businesses in B.C. are small, and B.C. has a higher proportion of small businesses than other provinces.

Actually, analysts, researchers and economists link that as, perhaps, one of the factors of why B.C. has weaker productivity performance — is because of our higher share of small businesses. But what we want to get at is that government wants to be able to try and identify the small businesses that are growing quickly.

With the whole talk and discussion around how small businesses create the majority of new jobs in an economy, the reality is that small businesses are growing quickly. That’s because, by definition, any new business, when it starts, is small because it’s a start-up. It has to be small.

It’s the ones that grow quickly that create the jobs, that are more productive and are more dynamic. It’s not across the board. Just the fact that you’re small doesn’t necessarily make you more productive, and in fact, some of the literature suggests otherwise.

G. Heyman: I notice that one of your recommendations was to drop the PST on electricity used for industrial purposes, which is consistent with one of the recommendations of the climate leadership team, which, as you know, was balanced — had some representation from business.

I’m wondering what other recommendations of that team you might specifically agree with.

K. Peacock: That’s a good question. It’s not my file, so I’m not as familiar with all the recommendations. Apart from the one that you just identified, I wouldn’t be able to offer any comments on any other recommendations that we’d be lined up with.

G. Heyman: If the Business Council has thoughts, we’re receiving further thoughts till October 14.

Seeing none, Mr. Peacock, thank you again for coming and presenting your views. Always appreciated.

S. Hamilton (Chair): I’ll call the committee back to order and welcome Rhonda Driediger and Reg Ens from the B.C. Agriculture Council.

Welcome. I’m looking forward to hearing your presentation. You know that it’s ten minutes. I’ll try to give you a wave with a couple of minutes left to conclude your thoughts. Then we can go to the committee for questions. If you’re ready, the floor is yours.

R. Ens: Thank you, Mr. Chair, and thank you, committee, for hearing us and spending the time to engage with constituents. We represent the B.C. Agriculture Council, about 28 farm organizations representing 21,000 of the farm families in B.C. Our members include everything from blueberries to dairy, poultry — organic, conventional. You’ve met with several of our members throughout your tours already. Thank you for doing that.

Our recommendation to you is focused this year, and it’s centred around the quote on the front page of the submission that we did — that the single scarcest
[ Page 2715 ]
item affecting food production around the world is public trust.

What we’re asking and recommending that the government do is invest $5 million for the next three years to kick-start the activities around public trust. I won’t go into all the details here. Fundamentally, what we’re saying is that the discussions that we’re having nationally, both with the federal government and with the other provinces, is the disconnect between the public and producers. There’s misunderstanding and mistrust that’s there.

If we don’t work to help educate both farmers and consumers on how their food is produced so that there isn’t some transparency, continuous improvement, you’ll be pressured into doing more regulation. We won’t be investing in productive production, we won’t be growing the industry, and we’ll not be having a secure food supply. We’re saying this is a proactive investment on behalf of government.

Looking at activities, we’ve had questions that this is just a marketing campaign. It does have a communications aspect to it, but fundamentally, it’s looking at the things that government is already investing in, such as animal welfare, animal care, food safety, traceability — bundling that into a program of what we’re calling “Doing the right things.”

It’s having producers, processers, fishers, retailers and everybody working together to look at what’s important to the consumer and what’s important to the constituents. It’s understanding that choice is important for people and then having that conversation to say that we’re making continuous improvements, that there’s transparency so that the consumer can see what people are doing on their farms. And while they are using new techniques and while they are investing in production practices that might be somewhat innovative, they’re not doing it to kill people, and it’s actually to provide a sustainable, safe food supply.

We’re saying that that’s the first thing that this would do. It’s investing in verification so that people can feel comfortable that they are getting what the farmers are doing and the processers are doing what they’re saying they’re doing. Then it’s having that conversation, so it’s engaging with consumers in urban markets, in rural markets and having them connect with farmers so that they can understand why certain practices are taken and why they’re doing that.

We’re saying that an investment in that now…. It’s a discussion that we, as a board, have had for the last year and a half. We’ve had engagement, like I said, federally and with our colleagues across the country. We believe that strategically, government investing in this now would be that kick-start to help get the process rolling and make this a new way or a standard way of operating in the future.

S. Hamilton (Chair): It was much less than ten minutes. Rhonda, did you have anything you wanted to add to that? Maybe talk a little bit about blueberries?

R. Driediger: Actually, no. I’m not going to actually speak about blueberries tonight, although it is my favourite subject. What this is, is not something…. It’s not a new initiative. This is not something brand-new. This is collecting up everything that we are doing as our own organizations and taking all the money that we’re already spending and all the effort that we’re already spending, collecting it up under one umbrella called public trust, and then looking to government to help fund those ongoing activities and that ongoing communication with the public.

We have one member which we probably shouldn’t mention…. They had one event happen on Facebook. One negative event. They feel that has cost them over $300,000 in one year, just dealing with that one event. Now, was the person right or wrong? It doesn’t matter. Public perception is everything. With social media the way it is now, one negative event can cause chaos in our industry, as we’ve seen.

What we’re looking to the government to do is help us spearhead our industries and take advantage of social media to the positive. As Reg says, we’re not out to poison people and kill people. We’re out to produce a good-quality, solid, safe food supply, and we’re doing that. But that messaging can be very, very difficult to get through to the public. That’s why we’re asking for, I believe it was, $5 million per year. Yeah, it’s $5 million per year for three years.

G. Heyman: I’m seeking a bit more clarity on the kinds of things that you think stand in the way of trust. Would they be issues of fertilizer, water, nutrient management, seeds — all of the above?

R. Driediger: Yes, all of the above. But to go it a little bit beyond that, yes. People can look at something positively or negatively. You can say: “Fertilizer. Oh my god, they’re using chemical fertilizer.” Yes, the plant does not care where the fertilizer comes from, but the plant does care that it has the right nutrients at the right time.

Most of us do soil analysis, tissue analysis, and we make sure we apply exactly what that plant needs at that time. We have every field identified on our farm, and each one gets a different nutrient, so nothing is going into the aquifer. Or I could say, “Well, I’d rather just put manure on,” and just dump a whole bunch of manure.

There’s a logic to everything that we do. You can look at everything positive or negative. We want to focus on the positive.

D. Ashton: Thanks for the presentation, greatly appreciated. Just a question, though. I always find strength in
[ Page 2716 ]
numbers and when people work together and walk down the road together. So is B.C. Agriculture prepared to step up in matching dollars or make contributions towards this campaign that your looking at?

R. Driediger: Actually, what we’re looking at is gathering up all the dollars that we’re already spending on this through all of our groups and looking for almost…. It’s not necessarily matching, but certainly, as a grower contribution, it’s probably well over $1 million a year in activities that we’re already doing. But we’re looking for that additional funding to make this a much broader, much more cohesive plan.

S. Gibson: My feeling is that some of the challenges that people in farming face is more the optics. A situation will take place that is not readily understood by people who are outside that particular community, and then it’s magnified. At the same time, there’s also good news.

I think it’s not just responding to bad news or trying to repackage it in a way that’s acceptable. For example, I just visited one of our largest dairy farmers in my riding. He’s got a situation where his cows only come to give milk when they feel like it, which sounds like a funny thing. They actually have little families of cows that look out for each other, and the cows come through. When they want to give milk, they will come through voluntarily. It’s not forced. You might say: why am I mentioning that? Because that’s very good. I think the consumer would appreciate that. An urban person would say: “That’s very cool.” But most people don’t know about that.

R. Driediger: Yeah, I think it’s important to be on the forefront of the information and give people the right information so that they can make those decisions and form opinions — so that when these bad-news stories or stories that aren’t necessarily true come out, they can actually go: “You know what? That doesn’t seem right to me. That does not seem logical. I already know that this is how the dairy industry operates.” But cows — yeah, you can’t trust those things.

C. James (Deputy Chair): A couple things. One, there’s so much more awareness these days from people around local food and around food security and awareness in urban settings. There always has been more awareness, I think, in rural settings, because they’re closer to seeing it. I think you’re seeing more awareness in urban settings now because of the food security issues and because of farmers markets and because of the buy-local movement. I think it’s certainly an opportune time to be able to inform the public when they’re paying attention and when they’re a little more aware.

Are there areas that you’re looking at to look at programs and areas that have worked in other provinces or in other areas of North America — areas of the States where they’ve taken on this kind of approach and have had some success?

R. Ens: There has been some work in the U.K., some work in the U.S. The Canadian Centre for Food Integrity was launched earlier this spring. That’s modeled off of a U.S. program, and it’s finding some research. We have a lot of anecdotal evidence, stories that are told, but nobody is doing any data collection.

So this was the first research that was done, and it was done on a Canadian basis. Unfortunately, it didn’t break out by province. So we’re saying: “Okay, one of the things we want to do is invest in doing that kind of research in B.C. so that we understand what is important to consumers. Are we hitting the right buttons, and are we educating? Are we having that right conversation with people?”

J. Tegart: I think it’s really important as we look at agriculture that we talk about the science. I think we have a lot of people who don’t understand the science of agriculture and think that it’s like: “Grandma and Grandpa used to throw the cow manure out, and everything grew, and everything was great.” But there have been huge steps forward based on good research on how we produce our food.

I think some of the lack of trust is that lack of knowledge and us talking about the science of farming.

R. Ens: As much as we support that 100 percent, the research shows that if I, as a consumer, believe that I have a similar value system to you, as a farmer, that’s three times more important than the science. So as much as we want to talk about the science, we have to invest personally with the consumers, with the voters, with the public so that we have a common understanding, so that we can have that conversation about science.

S. Hamilton (Chair): Thank you very much. My comments are…. I wouldn’t discount, on the heels of what Carole was saying, what farm markets and the awareness campaigns that have taken place so far have done to promote agriculture, buying local and the agrifood strategy. I think it’s very important, as well, to acknowledge how far we’ve already come.

But yes, if there’s still a ways to go, I’d certainly be happy to help however I can — help the farming com-
[ Page 2717 ]
munity get there, the agricultural community get there.

Thank you for taking the time to come out and express yourselves and your views. Take care.

By the way, Simon, Rhonda lives in Langley, so you can’t lay claim to her, either.

S. Hamilton (Chair): All right. Marko Dekovic, Global Container Terminals. Good evening. Welcome back. I guess you know the drill. Ten minutes to present, and then we’ll go to the committee for questions. So if you’re ready, the floor is yours.

M. Dekovic: Good evening. My name is Marko Dekovic. I’m the vice-president of government stakeholder relations with Global Container Terminals. I want to thank you for allowing me the time to talk to you a little bit about Global Container Terminals and what we see as some of our priorities in Budget 2017 and putting that in a bit of a context around what’s happening in our industry and what we’re doing about it.

I’ll walk you through a bit of a presentation, which I believe was handed out to everybody, just outlining a little bit about GCT — what some of the industry trends are that we’re seeing, some of our active and proposed investments; what the forecasts are and what we see in the future for container capacity on the west coast of British Columbia — and then, of course, specifically some key priorities for Budget 2017.

On slide 3, you see a little bit about Global Container Terminals. We’re a Canadian success story, and one of those few companies that has international operations both in the U.S. and Canada and is headquartered in Vancouver.

We are a tenant of the Vancouver-Fraser Port Authority, and we’re a tenant on the federal lands of the port authority. We operate two terminals in the Lower Mainland. One is GCT Deltaport, not too far from here. That is Canada’s flagship container terminal, the largest container terminal in Canada. We operate, in Burrard Inlet, GCT Vanterm. We also have two terminals in New York and New Jersey — one in Bayonne, New Jersey, and one on Staten Island in New York.

As I mentioned, we’re Canada’s flagship container terminal, and that sort of makes us the primary gateway to the Pacific. Last year alone we paid some $329 million in salaries. As the largest maritime employer in Canada, we support some 2,000-plus person-years of employment annually. Of interest, sitting here in Delta, is that some 54 percent of our employees live south of the Fraser.

Most importantly, as the largest terminal operator in Canada, we see it as our responsibility, as well, to be a leader in sustainability. On slide 5, you’ll see that we are demonstrating our leadership through certification with Green Marine. All four of our terminals are Green Marine certified, and we overall outperform the average in the terminals and stevedores category. Last month we were recognized by receiving the 2017 Clean50 Top 15 Projects award. We overall remain committed to sustainable growth through our terminals, number one, through densification as a first option before we look to an expanded footprint.

In slide 6, you’ll see some of the samples of the investments we make in a community. As mentioned, a lot of our employees live here, south of the Fraser as well. That’s why we have a long history investing in the communities in which we operate. The outline is just a small sample of the investments we make in Delta and in Vancouver.

On slide 7, you will see that further augmenting our ability to invest in the community is the fact that we are 100 percent Canadian-owned. We’re owned by a Canadian institutional investor, the Ontario Teachers Pension Plan. We benefit from their experience in investing and managing key infrastructure assets across the globe. You see here the list of logos that show just a sample of infrastructure investments.

We are in the infrastructure portfolio OTPP. We’re their single-largest investment — the only 100 percent–owned investment and, in fact, the only Canadian one. OTPP also follows a responsible investing mandate that encompasses careful consideration of environmental, social and governance risks.

So a little bit of putting GCT in context of what’s happening to our industry. On the next slide, you’ll see a little bit about what’s going on in this industry. You have larger ships, so we’re moving to larger ships, faster than ever before. So 18,000 TEU ships have called into the ports of L.A., Long Beach and Seattle as well. We’re seeing interest in 14,000 TEU ships calling into the Vancouver market. “TEU” is a unit for 20-foot-equivalent for containers. It’s just on the acronym side.

With the move to the larger ships, we also see consolidation of companies. You’ll see in the chart below, which we call the jaws of the crocodile, that as the number of TEUs or containers moved is growing and the maximum size of the vessel is growing, the number of vessels actually doing the trade has remained, over the years, relatively flat.

The number of services and companies doing the trade has actually gone down. What that means is that the shipping lines and the ships are looking to make stops in less places, or less ports, and do bigger off-loads of containers in those places. Really, what that does is put pressure on terminal operators to invest in landside surge capacity.

So what are we doing on the landside to quickly move the cargo that comes off these larger ships? The chart to your right shows the three alliances that are going to be operating in 2017. What has been happening over the last number of years, since about 2008, is that the shipping business has been not doing well, and as a result,
[ Page 2718 ]
it has been consolidating. Whereas ten or 15 years ago, there might have been something like a dozen customers that were doing business on the west coast of Canada, now there are really only three alliances, or three customers, that terminal operators can engage with to get that business.

If you look closely in the middle of the chart, there’s Hanjin, which, you might have heard recently, has gone bankrupt. If you were flying over from Victoria, you’ve probably seen a Hanjin vessel sitting off Victoria harbour, at anchorage, as a sort of side effect of them going bankrupt.

The next slide looks at from macro to more B.C. folks’ perspective of what is happening on B.C.’s west coast. If you look at the chart here, 40 percent of all B.C. container imports are actually U.S.-destined. That means, in both Vancouver and Prince Rupert, that 40 percent of everything that comes in actually is discretionary cargo that ends up in the United States.

About 20 percent is local domestic truck-moved cargo, and then about 39 or 40 percent goes on rail and goes to other parts of Canada. That is on the import side, and that is if you combine both Vancouver and Prince Rupert.

If you look on the export side, what is coming out of B.C.’s ports, about 67 percent of the boxes are going out full — that means exports, Canadian exports, B.C. exports — and get stuffed along the way — be it with grains, specialty crops, pulses, lumber, pulp, etc.

Then, about 33 percent of boxes are empty. That is additional capacity in the system that exists for potential exports from British Columbia and Canada.

Slide 10 looks at our long-term-horizon investments that were made by GCT. Back in 1997, GCT at that time was called TSI. It was the first terminal operator at the Deltaport facility and opened in 1997. In 2010, we made a $180 million investment to develop the third berth expansion at the Deltaport facility.

In 2015, we have made an additional $300 million investment that is actively an active investment — and I’ll touch on that in a bit — to grow the intermodal rail yard at the terminal.

That is really in line to build that landside surge capacity, as I was saying, which is now needed as a result of larger ships coming to our facilities. Then in 2016 we’re planning, in Q4 of this year, hopefully, to make an announcement about an additional $160 million investment in our Vanterm facility in Burrard Inlet. Then we have some other plans and options and opportunities should we, if the demand materializes, need to grow the existing GCT Deltaport facility in Delta.

I will wrap up by looking at slide 13. Really, what that shows is that there are a number of private sector options to deliver the needed capacity for container trade on B.C.’s west coast. They include both investments that GCT is making as well as Dubai Ports World, both in Vancouver and in Prince Rupert. That means that well late into the 2020s, there are options and planned projects that can meet B.C.’s container traffic capacities.

Looking on slide 14, we’ll look at past 2030. There still remain a number of private sector investment options that are available to bring capacity on line to meet demands as they materialize, allowing optionality in the system if the demand curve either slows down or speeds up.

In summary, we’re benefiting from the ownership by a Canadian institutional investor. We’re committed to long-term investments and overall sustainability of B.C.’s container trade terminal infrastructure. Overall, our ports remain competitive if investments are made from a lowest all-in cost from the gateway perspective. As demonstrated, there are a number of private sector–proposed scalable investments that provide least government financial at lower cost and least environmental and community impacts should they need to be brought on.

On priorities for Budget 2017. In order for us to continue making these long-term investments, one of the main things that has allowed us to make the investments in Deltaport or at GCT Vanterm is the Ports Property Tax Act, which has allowed us to have predictability in the system and encourage long-term investments. From our perspective, the priority for Budget 2017 is to keep B.C.’s tax regime competitive so that we can remain competitive vis-à-vis other west-coast-of-North-America ports.

Continue investments in off-terminal trade-enabling infrastructure — things like road-rail separations down the corridors or transit–freight rail separation, where you have some of the public transit and freight rail occupying the same tracks — highway interchanges and bridges. Those are things that, when they’re invested in, enable the private sector to step up and invest, grow the capacity and meet the demands needed for Canada’s trade.

Of course, continue incentive programs for industry to upgrade to higher-efficiency or lower-GHG equipment. As I mentioned, we’re sort of a leader in sustainable terminal operations, but there’s always more that can be done. Of course, we’re always looking for a reduction of trade barriers. As a trading nation…. We’re definitely supportive of those initiatives.

Thank you for your time. I’m open to answering any questions that the committee may have.

S. Hamilton (Chair): Okay, we probably do have some questions. Dan, I’ll start with you.

D. Ashton: Thank you for your presentation. Just quickly, I noticed your second one: “Continue investments in off-terminal trade-enabling infrastructure” — road grade separation, transit-rail, etc., bridges. That’s costly. That’s very expensive infrastructure. I’m just curious about…. I think they call it short sea shipping, by barge, to take the opportunity to take these contain-
[ Page 2719 ]
ers further up the river, up the Fraser, and have another, smaller port of transfer for those intermodal lines, instead of doing it twice. Is that considered?

M. Dekovic: There is some short sea shipping that already happens between a number of terminals, be it from Fraser Surrey Docks or Dubai Ports World in Nanaimo. That happens. It really is driven by economics, and there have been a number of studies. I believe Metro Vancouver has done a study and analysis of short sea shipping.

Due to the unique nature of the Lower Mainland and how far you can move a container — and the costs related to double handling of a container from a larger ship onto a barge and then again onto a train or a truck — with trucking costs, basically if you’re within 300 to 500 kilometres, it is still more cost-effective to move the container by truck than to move it by short sea shipping.

D. Ashton: As long as the government or the citizens are picking up the road. I’m on 17 a lot, and it’s plugged these days with containers. I’m just asking if there’s something in consideration, if you look at all the costs that maybe are borne by taxpayers, to ensure that that freight continues to move.

Looking at inland terminals, such as Ashcroft, as something that could play a role in the gateway. But specifically, our company is a marine terminal operator. If there are opportunities to collaborate with supply chain partners — we work, obviously, very closely with railways, and we have had discussions with Ashcroft terminal and others — then we can optimize the supply chain.

The land on which the containers sit near dock is the most premium. So if those moves or stuffing facilities or empty storage can be somewhere else along the supply chain, that is fine by us, and we’d be encouraging of that.

S. Hamilton (Chair): I’m glad you brought up the Ashcroft terminal. I’m sure Jackie here is glad too.

Seeing none, could I just get you to elaborate on one little thing? You talked about double handling with respect to short sea shipping, which Dan brought up. Isn’t there a certain amount of that that goes on now? Isn’t there a certain amount of containers that go onto a truck, and then they’re taken to intermodal yards and go onto trains?

M. Dekovic: Yes. A lot of the rail movement, in particular at Deltaport at our terminal…. That is our competitive advantage, if you will. We have one of the largest on-dock rail intermodal yards in all of North America, if not the world. The fact that a container can go straight from a ship into a container, onto a train and into the rest of Canada or, in some cases of discretionary cargo, into the U.S. limits the amount of the double handling. That’s on the import side.

On the export side, yes, the container will get double handled because it needs to get somewhere. A truck needs to take it to a facility that will fill it up, or a train, and then back onto a truck. But if you’re doing short sea shipping, you’re actually adding yet another level of handling to the container.

S. Hamilton (Chair): Thank you for that, and our time’s up. Thank you very much for taking the time. I appreciate it. Have a good evening.

I’m going to skip ahead here. I’m going to ask Mr. John Roscoe of the Ladner Sediment Group to come up and provide us with his presentation.

For those of you who may not know who I am and who we are, Ladner Sediment Group is a small volunteer group of people in Ladner — business owners and water lot owners. For the last eight years, we have been championing the cause of getting our local channels dredged. It was some 20-odd years before anything happened to them. They were filling in, and we were having big troubles.

What I’m here today for is that Ladner Sediment Group would like to ask that consideration be given by our provincial government to participate in funding a sustainable maintenance dredging program for these five channels in our area. That includes Ladner Harbour, Ladner Reach, Deas Slough, Sea Reach and Canoe Pass.

In 2013, EBA Engineering stated that a minimum of 48,000 cubic metres of silt will be deposited every year in these channels. At that time, the cost estimate was $750,000 per annum to get rid of it. What we’d like to look at now…. Ladner Sediment Group is proposing that this cost be shared by all levels of government. This might be a following breakdown that would work. The federal government would pick up 60 percent of that share to the tune of the $450,000 per annum. Provincial government would pick up 30 percent, at $225,000. Municipal government would pick up 10 percent, or $75,000.

Pursuant to this, Ladner Sediment Group, along with representatives from corporation of Delta and Port Metro Vancouver, as well as our Member of Parliament, hon. Carla Qualtrough, and our MLA, Ms. Vicki Huntington, met this past July and agreed to draft a proposal that would outline this request for sustainable funding in these channels. We will proceed to make that happen, and when we get that finished, we would then like to present that to the particular government bodies. We anticipate that will be done in the next week or two.
[ Page 2720 ]

Why are we asking this, and what’s the justification? These channels have just recently — last year — undergone an extensive dredging program to bring them back to the minimum acceptable levels for safe navigation for small craft vessels and pleasure craft.

This dredging has also allowed the local water lot leaseholders a better opportunity to maintain their own respective water lot depths, and this dredging does contribute to some degree to the mitigation of flood control, as these channels are now deeper.

The dredging work recently completed was a culmination of a $7 million expenditure of taxpayers’ dollars, and it would just be a catastrophic waste of these tax dollars if we do nothing and just let these channels fill in again.

The initial funding, two years ago, was contributed by…. Port Metro Vancouver put in $2½ million. The B.C. government, through MOT, put in $2½ million. Corporation of Delta put in $2 million.

Now, the reason for that…. In 2012, the corporation of Delta instigated a study by InterVISTAS group and identified that these channels support the following economic numbers. They support 200 direct jobs, $6 million in direct wages, $11 million in direct GDP, $39 million in direct economic output. They also support a tax revenue of about $1.7 million to the federal government, over $750,000 to the provincial government and over $320,000 to the municipal tax revenue base.

These economic numbers and the tax revenue numbers are going to be put in jeopardy if these channels are allowed to infill, thereby causing the businesses, the homeowners, government fisheries boat basin, marinas, etc., which are either going to have to relocate or cease operation. The economic loss that those groups will suffer is going to be staggering, and in some cases, it will probably trigger bankruptcies of these companies.

The draft agreement that we’re proposing would generally follow a format which is based on the contract that just finished right now between Port Metro Vancouver, the B.C. government and corporation of Delta. We can go through that and read that through. But I think the most important thing is…. I would skip that, and I would just like to bring your attention to section (h) of the last page. “The province of British Columbia has ownership of these Lower Fraser River secondary channels. We would suggest that they consider a commitment of a 30 percent share of the cost of $225,000 annually to not be an excessive request.” They are your channels.

S. Gibson: Two quick questions. Have you had any communication with the Fraser Basin Council? My second question. My understanding is this would have to be approved by federal Fisheries and Oceans. Is that correct or not?

J. Roscoe: To the first question, yes, we have talked with them before. The Fraser Basin Council is on a little different venue than ours. They’re looking at the whole Fraser River, from the Sand Heads to Hope and beyond, which is way past the scope that we’re looking at.

To the second question, I’m not too sure which division of the federal government would be involved. Certainly, Fisheries will have a say in it. Historically, it has been…. I guess now it’s Transport Canada, which at that point would have been Public Works Canada. It used to look after all the dredging in the river. They, I think, should be carrying on some of that responsibility.

S. Gibson: For example, I have the Fraser flowing through my riding of Abbotsford-Mission. There has been interest in dredging some of the gravel, which has proved to be very controversial with Fisheries and Oceans, as you might know.

J. Roscoe: Yes, we do have to…. With any dredging, of course, Fisheries and Oceans are very much involved in the decisions — how to dredge, when it’s going to be dredged, where we’re going to dump the dredgeate. We were very successful. Port Metro Vancouver, of course, are doing that all the time. Within this proposal, it has been recommended that Port Metro Vancouver would end up being the management group that would handle this, just as they did in the last one, and Port Metro Vancouver has agreed that they would consider looking at that.

C. James (Deputy Chair): Just a question. You mentioned not wanting to waste the resources that have already been used and the work that’s already been done, by setting it back. Is this an annual dredging that would need to occur then? You’ve got a per annum. I just wondered: how often does the dredging need to occur to be able to keep the channels clear?

J. Roscoe: You kind of have to ask Mother Nature that as well, because she has a lot to do on that. However, just to try and put a ballpark number at you, that $750,000 is EBA Engineering’s estimate of what it would cost per annum to keep them at that level.

What we’re suggesting is that if the parties could put that money aside, maybe every three years we’ll go in and spend $1 million or $2 million just to maintain. Mother Nature has a habit of not spreading it evenly. It will put a big lump somewhere and leave the other part empty. We keep fighting that.
[ Page 2721 ]

G. Heyman: Just quickly. Have you had any interest or takeup from the federal or municipal levels of government?

J. Roscoe: Municipal, yes. We’ve had very good success with them. Sean McGill, who’s with the corporation of Delta, has sat with our groups and has been very instrumental in getting the corporation of Delta on board.

Federally, it’s been not quite as opportune. We’ve had a little more difficulty bringing them to the table. I’m very hopeful now that the proposal that we’re in the process of putting together, which we will deliver to our Member of Parliament…. That she’ll be able to maybe bring something to the forefront.

S. Hamilton (Chair): Thank you. My question: Canoe Pass, was it dredged as part of the last program?

J. Roscoe: No. We’re still waiting. Part of that, Scott, was going to go with Port Metro’s habitat banking program, in which they want to do some habitat banking down in the south end of Canoe Pass. That’s still in the throes of being settled out. First of all, we didn’t know whether the B.C. government owned the property or whether Port Metro Vancouver owned it, and then who was going to authorize doing it. Of course there are a few other people involved that have also come up.

So they’re still working on it, and there are another 80 to 100 cubic metres that will come out of that area. That will be under the auspices of Port Metro’s habitat banking program.

S. Hamilton (Chair): Understood. Well, I can certainly personally attest as to why it’s called Canoe Pass.

S. Hamilton (Chair): It’s not very navigable, that’s for sure. Anything bigger than a canoe….

Mr. Roscoe, thank you for taking the time to present and for enlightening us as to this very important subject. We appreciate it. Have a good night.

Next, we have the Physiotherapy Association of B.C., Jason Coolen and Kevin Evans.

Gentlemen, good evening. Welcome. You’ve probably been sitting there long enough to know that it’s ten minutes for the presentation. I’ll try to get your attention, and you can conclude your thoughts and then go to the committee for questions after that. The floor is yours.

J. Coolen: Thank you very much, committee. Folks, first, I just wanted to mention how appreciative I am for you guys making the time to hear us tonight. Thank you. I’m sure you’re going to be listening to a number of people over the next little while.

My name, of course, is Jason Coolen. I am a registered physiotherapist here in B.C. I’m a co-owner of three clinics in the Lower Mainland. But I’m primarily here tonight in my capacity as Physiotherapy Association president, and I’m looking forward to addressing some issues with you folks.

K. Evans: I’m Kevin Evans. I’m the CEO of the association, which represents more than 2,400 British Columbia physiotherapists and lives with the vision of keeping British Columbians moving for life.

So $19.6 billion — that’s how much the British Columbia government plans to spend on health care this fiscal year, as you know well. In ’17-18, the current three-year fiscal plan calls for that to increase to $20.1 billion, then $20.7 billion in fiscal ’18-19. The demographic trends that some of us are reminded of every morning when we look in the mirror suggest to us that we will be placing unrelenting pressure on government to spend more and more and more on health care in the years ahead.

We are not here tonight to ask for more spending on health care, because we all know it’s not sustainable. We’re approaching a tipping point where the health care demands of an aging population outstrip the capacity of those still in the workforce who pay taxes to support it.

J. Coolen: We need to spend that already sizeable chunk of money differently. We want to take this opportunity to alert you that physiotherapy is part of that solution. We believe physiotherapy is underutilized as a cost-efficient means of improving patient outcomes and health care system performance. We are not just about low back pain and sprained ankles. It’s time to take a fresh look at the promise and the potential of physiotherapy — my profession.

K. Evans: The Physiotherapy Association of B.C. unreservedly supports the strategic aspirations of B.C.’s Ministry of Health to grow and strengthen primary, front-line health care by developing community-based, integrated, interprofessional primary care teams.

Primary health care is meant to shift the focus away from a purely biomedical model built around hospitals to one of prevention and increased consideration of the social determinants of health and based in communities. Physiotherapists are fully integrated into primary health care models in England, Scotland, Ireland, Wales, the Netherlands, Sweden, Norway, U.S., Australia, New Zealand and in the Canadian and U.S. Armed Forces, creating along the way a lot of evidence of the significant impacts on primary health care delivery outcomes and, in the context of this group, health care costs.

As our province enters a new era of health care delivery, the time is right for physiotherapy to contribute its full potential by being transitioned from the side lines
[ Page 2722 ]
to the front lines. This committee can help, tonight, by recommending in its prebudget report that the Ministry of Health ensure physiotherapists are included in the planning, the development and the implementation of B.C.’s new primary health care model.

J. Coolen: There remains a significant challenge to the sustainable development of cost-saving, interprofessional community health systems. That is a shortage of physiotherapists.

In B.C.’s Northern Health Authority, for example, we’re told that many of the 41 interprofessional teams, or IPTs, that have been established as of the end of last month will not have physiotherapists. In recent email correspondence with our association, the NHA references physiotherapy shortages as a limiting factor in the creation of the IPTs.

I quote: “The teams that have been created using existing human resources, and physiotherapists are scarce in the north. Physiotherapists have been transitioned to IPTs wherever possible, as they are integral to the care of people with complex care needs, especially seniors and those with mobility or functional challenges.”

According to the government’s 2025 Labour Market Outlook, physiotherapy is No. 2 on the top priority health profession list, second only to specialty nurses. But unlike nurses — where an elaborate health human resource planning process has been established — there is nothing similar for that of physiotherapy.

Here’s an interesting statistical tidbit on the demand-supply gap for physiotherapy in our province. Despite having the highest rate of physiotherapists per population and the highest rate of physiotherapist employment since 2001, British Columbia has nearly a third of all physiotherapy job vacancies in Canada.

K. Evans: People in rural and remote British Columbia are particularly hit by the severity of this shortage. For example, the Northern Health region is home to just 86 of B.C.’s 3,300 physiotherapists. That works out to about one physiotherapist for 3,500 people compared to one per 1,400 in the rest of B.C. — a difference of about 3 to 1.

In nine towns in the north there is no publicly funded physiotherapy access because there are no positions. Other communities have physio positions, but they’re vacant. In others, the physios that are there are stretched to the limit. The physio in McBride covers the entire Robson Valley, including Valemount where the nearest option is a two-hour drive to Prince George.

We invite this committee to view taking on the shortage of physiotherapists in British Columbia as a fiscal opportunity — a sound, evidence-based, cost-effective business decision. Let’s begin where the opportunity is greatest, and that’s in the north.

J. Coolen: That leads us to our second ask. British Columbia has fewer physiotherapy training seats per capita than any province in Canada. If we’ve learned one thing about rural health and health care recruitment, especially in my discussions with some of my members up north, its axiom is: “Train in the north. Treat in the north.”

Last year, this committee showed that you get it when your report recommended 20 physiotherapy training seats be established at UNBC in Prince George. As you heard from our northern colleagues just the other day when you were in Prince George, nothing has happened with your recommendation. In the passage of a year, the urgency of that recommendation has only increased. We’ll leave that with you.

In conclusion, thank you so much for the opportunity to be here with you tonight. Again, thank you for taking the time to be with us.

S. Hamilton (Chair): Thank you, gentlemen. I do have a question. First I’m going to go to Jackie.

J. Tegart: We hear — and I live in the interior in a rural area, but also in the north — the challenge around attracting people into our small rural communities. Obviously, there’s no magic pill. There’s no way we can force people; people have choices. But as a professional organization, when you look at service in the province as a whole, do you have strategies within your organization that are looking at how we encourage people to go to underserved areas? What can we do?

K. Evans: We sure do. We have a rural and remote health committee in the PABC. This question has been extensively researched not only in British Columbia but in other jurisdictions. It comes down to what we’ve just told you: people from the north will stay in the north. What we need to do is to be able to attract northern young people into physiotherapy and other health professions. Train them in the north, in their communities, and they will stay in their communities.

J. Tegart: Could I just do a follow-up, then? If the only choice were to move money out of the Lower Mainland into the north…. There’s only so much money. Have you had that discussion within your organization? We’re extremely challenged around how we get these services in the north. If there’s only a pot of money and it can be spent anywhere in the province, is there any kind of support for saying: “You know what? We really need to concentrate in the north”?

K. Evans: Absolutely. On Monday, I visited with the Deputy Minister of Health, Stephen Brown, and said exactly that. It’s not a question that there’s not enough money up there. There are not enough physios up there. As I indicated, we have vacant positions up there.
[ Page 2723 ]

To the credit of the Ministry of Health, they recognize that this is a health human resource crisis in some professions throughout the province of British Columbia. We are working collaboratively with them to develop some strategies to try and address it, beginning with actually having some really good labour market analysis. We’re working on that with the ministry right now.

J. Coolen: If I could just add onto that. There is a program in place right now with UBC in trying to encourage students to do work at UNBC, up in the north. There are certainly challenges around that, and at our board and with UBC and so on, we are certainly having those discussions on how we can encourage that more.

J. Tegart: I would suggest that we do those practicums during the summer. Maybe people would stay in the north, because winter seems to be a big challenge also. I mean, any strategies would be helpful.

K. Evans: If I can just add, our association is embarking upon a public education campaign and a high school education campaign to extol the virtues of practice in rural and northern British Columbia.

C. James (Deputy Chair): Just a quick comment to say thank you. You’ve been well represented by your members, as well, who’ve been presenting to us in communities and doing a really good job of talking about the flavour of their individual communities and the work they’re doing. That’s been very helpful to all of us. I think you’ve identified one of the areas — which is encouraging people who live in those communities to take those positions and be trained in their communities. They’re more likely to stay.

I think the second piece, though, that you identified well for us is the importance of making sure people understand that physiotherapists can be part of a health team. I think people often…. Now you’re getting people used to seeing doctors and nurse practitioners. I think to expand that — for people to recognize the importance of physio as part of that medical team — is the next challenge. I think it’s a challenge that you’re ready to take on. I appreciate it. Thank you.

D. Ashton: One of your physios needed physio. We had two very nice ladies representing your organization who came to see us. We were all smiling because one of them needed physio when she walked in the doors.

D. Ashton: Yeah, she was on crutches and was a…. We had a good laugh over it. But they did a very good job of representing your organization.

S. Hamilton (Chair): All I know is that Travis Wolsey has bent me back into shape more times than I can count. So I thank gosh for him.

S. Hamilton (Chair): He is, you betcha. Okay. Well, gentlemen, thank you very much. I appreciate your taking the time. Good luck, and I look forward to continuing our conversations.

Next we have the British Columbia Real Estate Association — Deanna Horn and Damian Stathonikos.

Good evening. Welcome. You have ten minutes to present. I’ll give you a wave when time is winding down, and then we’ll go to questions.

D. Stathonikos: Good evening. I’m conscious of the fact that it looks like we’re the last ones between you and leaving, so we’ll try and keep this to the point and make ourselves available for any questions you have afterwards.

Thank you, Mr. Chairman and distinguished members, for the opportunity to present our recommendations. We certainly appreciate your time and commitment, especially given the late nature of the evening.

My name is Damian Stathonikos. I’m the director of communications and public affairs for the B.C. Real Estate Association. I’m joined today by Deanna Horn, a realtor from Langley, the B.C. Real Estate Association’s president and a long-serving and well-respected leader in our real estate community.

We represent the 11 real estate boards in the province and more than 20,000 realtors across B.C., and we provide continuing education, advocacy, economic research and standard forms to help realtors provide advice and value to their clients.

It’s no surprise that housing affordability has received a lot of attention over the past 18 months, and rightly so. For decades, that question has been at the forefront of many people’s minds and certainly, here in the Lower Mainland, of particular concern.

The current unprecedented market cycle, which seems to be levelling out a little now, has reminded the public and all levels of government that the attention needs to be paid to policies to ensure that demand is balanced with supply and that barriers to entering the market need to be removed or justified.

A healthy real estate market offers options to suit a wide variety of needs. Although we’re not convinced that all of the initiatives at the provincial level meet that test, the major changes to the property transfer tax this year at least signal a willingness to make some bold choices.

From our perspective, restoring tax fairness to homebuyers would have the broadest and longest-lasting im-
[ Page 2724 ]
pact. B.C.’s property transfer tax, which is the highest in the country, places an unfair burden on homebuyers. Our recommendations are intended to assure a fair approach for homebuyers now and in the future.

As you know, the property transfer tax was introduced in 1987. It’s levied at 1 percent on the first $200,000, 2 percent between $200,000 and $2 million, and 3 percent on the balance. In addition, in the greater Vancouver regional district, foreign buyers must pay 15 percent of the fair market value.

Because of the way the foreign buyers tax was implemented, our first recommendation is to ensure that real estate transactions already underway are exempt from any future changes to the property transfer tax. Buyers, including foreign buyers with valid work permits, were unfairly caught up in the additional tax, which has also had a negative impact on B.C. residents.

For example, sellers often need to sell their homes before they can buy other homes, and when the foreign buyers tax was implemented, these sales were interrupted, making it impossible for these British Columbians to sell their properties.

Our second recommendation is to use some of the revenue from the foreign buyers tax to increase the 2 percent threshold from $200,000 to $525,000. When the tax was first introduced, the 2 percent portion was expected to apply to only 5 percent of sales. Last year, that 2 percent portion applied to 85 percent of homes sold.

Increasing that 1 percent threshold would indeed result in less government revenue — about $197 million — if the recommendation had been adopted last year. However, increasing that threshold would benefit many buyers across the housing continuum, whether buying new or existing homes.

In particular, it would benefit those who often struggle the most to enter the housing market: buyers who are trying to purchase an existing home at the lower end of the market and who are not first-time homebuyers. It would also benefit buyers of commercial real estate.

Finally, to maintain the intent of the tax as it exists today, we urge that all thresholds associated with the tax are indexed, with adjustments made annually. These thresholds include the points at which the 2 percent and 3 percent rates apply, as well the exemption thresholds for first-time buyers and buyers of newly constructed homes.

The thresholds, as you know, are not currently indexed. That means B.C. homebuyers pay an increasingly unfair amount of property transfer tax per transaction every year. It also means that the benefit of those exemptions shrinks every year. Indexing will ensure that the tax has the same impact on current and future homebuyers.

As you know, housing is a significant economic contributor to our provincial economy. The average transaction results in $62,000 in expenditures on services, renovations, taxes and other household purchases. More than 100,000 homes were sold through the Multiple Listing Service last year, representing about $65 billion of investment by British Columbians.

Everyone seems to recognize that home ownership is an important part of the foundation of a healthy community and a thriving province. We believe that fair shelter taxes and a thriving economy will help citizens throughout B.C. enjoy an enviable quality of life.

More details are available in the written submission in your packages. I just wanted to say thank you again for the opportunity to present our recommendations. I’m certainly open to questions.

S. Hamilton (Chair): Terrific. Thank you very much. I will go to the committee for any questions they might have.

S. Hamilton (Chair): I’ve said it before: this doesn’t indicate indifference. It’s just that we’ve asked a lot of questions. We’ve heard a lot. We’ve had a lot of input from organizations like yours, and we’ve got the message loud and clear. No doubt about it. Any lack of questions, again, doesn’t indicate indifference.

G. Heyman: I think you mentioned that if the recommendation of raising the threshold had been implemented last year, it would have equalled about $147 million in forgone revenue. At the same time, however, the overall revenue rose. Is that against the higher revenue that was realized or before that additional revenue was realized?

D. Stathonikos: That’s before. It was calculated based on sales that happened in 2015.

S. Hamilton (Chair): Okay. Well, thank you very much for taking the time. We appreciate it, as always, and look forward to seeing you again when the time is right.

I know some committee members have a ways to travel to get home, so safe journeys.

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

Chair:	Wm. Scott Hamilton (Delta North BC Liberal)
Deputy Chair:	Carole James (Victoria–Beacon Hill NDP)
Members:	Dan Ashton (Penticton BC Liberal)
	Robin Austin (Skeena NDP)
	Eric Foster (Vernon-Monashee BC Liberal)
	Simon Gibson (Abbotsford-Mission BC Liberal)
	George Heyman (Vancouver-Fairview NDP)
	Jennifer Rice (North Coast NDP)
	Jackie Tegart (Fraser-Nicola BC Liberal)
	John Yap (Richmond-Steveston BC Liberal)
Clerk:	Susan Sourial

1) BC Government and Service Employees’ Union	Simon Kelly
	Megan Scott
	Stephanie Smith
2) Canadian Taxpayers Federation	Jordan Bateman
3) Manufacturing Safety Alliance of BC	Lisa McGuire
4) Real Estate Board of Greater Vancouver	Harriet Permut
5) Pacific Hepatitis C Network	Daryl Luster
6) BC School Sports	Jordan Abney
7) BC Association of Farmers’ Markets	Heather O’Hara
8) Association for Mineral Exploration British Columbia	Rick Conte
	Gavin Dirom
9) Business Council of British Columbia	Ken Peacock

10) BC Agriculture Council	Reg Ens
	Rhonda Driediger
11) Global Container Terminals	Marko Dekovic
12) Ladner Sediment Group	John Roscoe
13) Physiotherapy Association of BC	Jason Coolen
	Kevin Evans
14) British Columbia Real Estate Association	Deanna Horn
	Damian Stathonikos

REPORT OF PROCEEDINGS(Hansard)

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES