[ Page 2417 ]

CONTENTS

Petition

Pulp and Paper Workers of Canada, etc. Mr. McGeer — 2417

Routine proceedings

An Act to Amend the Municipal Act (Bill No. 175). Hon. Mr. Lorimer.

Introduction and first reading — 2417

Public Works Fair Employment Act (Bill No. 153). Second reading.

Hon. Mr. Hall — 2417

Mrs. Jordan — 2418

Mr. Dent — 2419

Hon. Mr. King — 2419

Division on second reading — 2421

Iron Bounty Act Repeal Act (Bill No. 19). Second reading.

Hon. Mr. Nimsick — 2421

Mr. Richter — 2422

Mr. McGeer — 2422

Mr. Chabot — 2423

Mr. D.A. Anderson — 2424

Hon. Mr. Nimsick — 2424

Copper Bounty Act Repeal Act (Bill No. 20). Second reading.

Mr. Richter — 2425

Mr. Phillips — 2425

Mr. D.A. Anderson — 2429

Mr. Chabot — 2430

Mr. Wallace — 2432

Mr. McGeer — 2432

Hon. Mr. Nimsick — 2433

An Act to Amend the Petroleum and Natural Gas Act (Bill No. 31) Second reading.

Hon. Mr. Nimsick — 2434

Mr. Smith — 2434

MONDAY, APRIL 9, 1973

The House met at 8:30 p.m.

Presenting petitions.

MR. P.L. McGEER (Vancouver–Point Grey): Mr. Speaker, I beg leave to present a petition. It is a petition from: Fred D. Mullin, the president of the Pulp and Paper Workers of Canada, George Brown, the regional vice-president of the Canadian Association of Industrial, Mechanical and Allied Workers; and Bill L. Warren, secretary of the Pulp and Paper Workers of Canada.

MR. SPEAKER: Order, Hon. Member, before you proceed. I don't know whether you are aware of the rule but you don't read the petition out at this stage; you just give us a very slight thumb-nail sketch of the subject and then put it in at the Clerks' Table. They used to have a bag to put them in behind the Speaker's chair but we haven't a bag here.

MR. McGEER: Mr. Speaker, I know how the Canadian Workers Union feel. This is a properly signed petition and the petitioners humbly pray…

MR. SPEAKER: Order. You are not supposed to read out the petition or the prayer but just state the subject matter and turn it over to the Clerks who will examine it and we will deal with it tomorrow.

MR. McGEER: Mr. Speaker, the petitioners urge the House pass a resolution urging that the Labour Relations Board reconsider its decision in the matter of the Canadian Workers Union at Trail, British Columbia.

MR. SPEAKER: Thank you, Hon, Member, I'll have the Clerks examine it.

Introduction of bills.

MR. SPEAKER: The Hon. Minister of Municipal Affairs.

HON. J. G. LORIMER (Minister of Municipal Affairs): Mr. Speaker, I have the honour to present a message from His Honour the Lieutenant-Governor.

AN ACT TO AMEND THE
MUNICIPAL ACT

MR. SPEAKER: His Honour the Lieutenant Governor transmits herewith a bill intituled An Act to Amend the Municipal Act and recommends the same to the Legislative Assembly, Government House, April 9, 1973.

Bill No. 175 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Orders of the day.

HON. D. BARRETT (Premier): Mr. Speaker, I move we proceed to public bills and orders.

Motion approved.

HON. MR. BARRETT: Adjourned debate on Bill No. 153.

PUBLIC WORKS FAIR
EMPLOYMENT ACT

(continued)

MR. SPEAKER: Bill No. 153. The Hon. Provincial Secretary adjourned the debate.

HON. E. HALL (Provincial Secretary): Mr. Speaker, before the supper hour I advised the House that I wished to add to this debate and in particular to remind the Members of the Opposition of the powers that are presently given to the Minister of Labour (Hon. Mr. King) regarding fair employment practices. There seems to be some impression in the minds of the Opposition, which they were seeking rather assiduously to send around the province, that these were new powers and that the new Government had stretched itself beyond its wildest imagination to give unto the Minister the kind of powers the Opposition decried.

I just want to point out that the principle of this bill is to make more meaningful, Mr. Speaker, the fairness of employment in that particular sector of the community that engages itself in public works business. The fact of the matter is — and I am looking intently at the Member for Columbia River (Mr. Chabot) who I am sure has no idea what chapter 324 of the statute has to say — that the Act gives the present Minister and all the Ministers who preceded him up to 1961, the power to fix wages, to arbitrarily decide what rate per hour a workman should get…

MR. J.R. CHABOT (Columbia River): What's wrong with that?

HON. MR. HALL: …to arbitrarily decide what wages and working conditions should pertain to those people who are engaged in working in the public sector, working for those companies who enjoy the success of having bid on a contract.

Frankly, that is the kind of power the Minister of Labour in the previous administration was quite pleased to have. I never heard him say a word in the seven sessions I have been here about those excessive

[ Page 2418 ]

powers that he picked up the day he entered the cabinet on that grim day a year and half ago.

I want to point out, Mr. Speaker, that what this bill seeks to do now is to give the people who are engaged in working in this province for employers with opportunities for public bids the right to decide together what their wages shall be and not to be decided by the Minister of Labour who can come in and say which kind of contract they are going to get and what kind of money. I wanted to point that out very carefully because the smokescreen that has been put up from time to time on these bills needs, frankly, clearing away.

Mr. Speaker, I think that should commend itself to you as sufficient reason to examine that particular statute and bring it more in line with the kind of things this party and this Government stand for.

MR. CHABOT: Wrong bill.

MR. SPEAKER: The Hon. Member for North Okanagan.

MRS. P.J. JORDAN (North Okanagan): Mr. Speaker, I don't wish to talk in any heavy debate on labour; I don't consider myself an authority. But it is quite obvious who the authorities on labour are in this Government and who in fact are the architects of these bills that discriminate against the rights of individuals and people in British Columbia.

I was very interested to hear what could be described as nothing other than the mumble-jumble that came from the Hon. First Member for Vancouver-Centre (Mr. Barnes) this afternoon and I suggest he go back into his welfare office. After listening to him talk about defending people's rights and oppressed people, I really wondered…

AN HON. MEMBER: He's a great authority.

MRS. JORDAN: …what had attracted him to British Columbia and if in fact he isn't just a little bit confused. Certainly one of the charms of British Columbia and the benefits of British Columbia is the fact that we have had more leniency and democratic rights and more individualism in British Columbia than there have been in many other countries.

MR. CHABOT: Back to Oklahoma.

MRS. JORDAN: It is that type of atmosphere that attracted him here, I'm sure. Why does he want to become a party to a dictatorial effort to destroy that atmosphere and to destroy those rights? I find it extremely difficult to understand, and I found his argument less than an argument — more an exercise in social philosophy without any concern for what he called the realities of life.

The realities of life are that there are all kinds of people, Mr. Speaker, in this province who operate very small businesses, who start bigger businesses by being a small business and who frequently do work on government contracts or on the basis of a subcontract for a larger contractor that has a government contract.

I happen to have the honour of representing several of these. One company that frequently bids on highway work in the north Okanagan and does more than what he is paid to do is a local man who has a local company with his family and other people. They are not unionized but they pay the same wage, and at times they pay more, Mr. Speaker. Their workers often get more time off or other benefits. They have more leeway; they work when they are busy and they have time off when they are not busy. On the average they get more money than if he was a unionized contractor.

I speak on behalf of people like this because I believe and this Social Credit Party believes that they should have the right to bid on jobs either on a contract basis or a subcontract basis or a sub subcontract basis for their tax dollars.

MR. CHABOT: Glenshiel Hotel.

MRS. JORDAN: In this legislation, this union organizer of a labour Minister is using the people's own tax dollars to cut their throats.

MR. CHABOT: Hear, hear.

MRS. JORDAN: I suggest there is no equality and no fairness in that, Mr. Speaker. This Minister of Labour has been seen on television, has been seen at public meetings telling people to go out and organize and organize and organize. That again is a destructive force. In as independent a province as British Columbia, why should people have to organize if they don't wish to?

The responsibility of a democratically-elected government, Mr. Speaker, is to protect all the people, not just the organized people. We stand for all the people, Mr. Speaker, the little people, the unorganized people and the volunteers. I would ask the Minister of Labour, Mr. Speaker, in, debating the principle of this bill: is he taking the first of many steps in organization and is he going to stand up in British Columbia in the-next two or three years and tell volunteers to organize…

MR. CHABOT: Yes.

MRS. JORDAN: …as some of his cohorts are doing in the United States? Mr. Speaker, is this the first step towards hospital auxiliaries having to be organized because they work in are-as where there are,

[ Page 2419 ]

tax dollars?

Interjections by some Hon. Members.

MR. CHABOT: Right on.

MRS. JORDAN: Mr. Speaker, what about the people who help in schools as aides, parents in handicapped centres? Are they going to have to organize and unionize before they can serve their fellow man and the handicapped and their fellow women?

Mr. Speaker, if that Minister of Labour keeps going around telling people, "If you want to be heard, organize. If you want to be heard in British Columbia, organize," and brings in legislation like this that says you cannot work unless you are organized, everybody in British Columbia including the hospital auxiliaries, the teachers' aides, the volunteers in handicapped centres will have to unionize, Mr. Speaker.

Mr. Speaker, that can be described as nothing but devastating to the freedoms of the people in British Columbia and all that we believe in and work for. And tonight, Mr. Speaker, our suspicions were confirmed. We've mentioned in this House before, we've seen examples before where this Government responds to lobbies.

We had a lobby over an innocent little thing like a grant from the cultural fund. The Premier responded to a lobby without even knowing what he responded to. He said on the television tonight, "This legislation is in response to the companies and the unions." The big companies, Mr. Speaker, and the big unions. It's not in response to the individual little companies. It's lobby legislation, Mr. Speaker. It's the result of lobbies and it's another example of where this Premier and this Government do not, in fact, realize the consequence of their actions. It's another example of Barrett's Blunderland. It erodes the democratic rights of individual little contractors, and it's going to erode the rights of the volunteer people in this province. It's bad legislation, Mr. Speaker, and we will not support it.

SOME HON. MEMBERS: Hear, hear!

MR. SPEAKER: The Hon. Member for Skeena.

MR. H.D. DENT (Skeena): The Hon. Member for…

Interjections by some Hon. Members.

MR. SPEAKER: Order, please.

MR. DENT: The Hon. Member for North Okanagan (Mrs. Jordan) has moved me to rise to my feet and speak in this debate. There is a point which I think needs to be made to the Hon. Member: for 20 years there have been organizations in British Columbia that have been becoming stronger and stronger and stronger. These are the international, multi-national corporations.

MRS. JORDAN: It's giving them another ticket.

MR. SPEAKER: Order.

MR. DENT: Now speaking from a religious point of view, briefly, I think the only place, Hon. Member, where there's going to be a completely free society, I hope, is in heaven. And we say, "Thy will be done on earth as it is in heaven." But it hasn't happened here yet. We're still in a market place society. We're still in a society where human nature prevails, and we're still in a situation where people can only achieve proper protection by organizing themselves. I rise in support of this bill.

MR. SPEAKER: The Hon. Minister of Labour closes the debate.

HON. W.S. KING (Minister of Labour): Thank you, Mr. Speaker, if I may take liberties with the House for just one moment, Mr. Speaker. I would like to introduce in the gallery tonight Mr. and Mrs. Fred Harwood from the City of Vernon. Mr. Harwood was a long-time alderman in the City of Vernon — a very responsible businessman in that community for many years. I'm just somewhat sorry that he had to choose this particular night to come to the House and witness that incredible performance by the Member for North Okanagan (Mrs. Jordan). However, I'm sure that he'll take pity on the Hon. Member for North Okanagan and not tell anybody when he gets home about that performance. (Laughter).

Well, Mr. Speaker, I've rather enjoyed the debate on this particular bill because I think it served…

Interjection by an Hon. Member.

HON. MR. KING: I think it served, Mr. Speaker, to really point out in a very effective way the essential difference in philosophy between this Government and those Opposition people on the other side.

MR. CHABOT: Red shirt.

HON. MR. KING: Now "red shirt" the Member said. That's a remark that I heard earlier today, you know, and I suppose the natural response would be, "Well, if the shirts designate the philosophy, how come you're wearing yellow instead of black?" (Laughter). But really, Mr. Speaker…

[ Page 2420 ]

Interjections by some Hon, Members.

MR. SPEAKER: Order.

HON. MR. KING: No commercials, please.

Interjections by some Hon. Members.

HON. MR. KING: Also, I hope they're wearing oxfords instead of high boots, Mr. Speaker.

Interjections by some Hon. Members.

MR. SPEAKER: Order, order.

HON. MR. KING: Certainly, it's a responsible Opposition — one can tell by the decorum that we have in the House tonight.

Mr. Speaker, the interesting thing I think about this debate is that many people have come to the defence of minority groups. They've spoken on behalf of management. They've accused the Minister of Labour and the Government of responding simply to the wishes of organized labour in this legislation. Just let me read, Mr. Speaker, what the president of Construction Labour Relations Association, Mr. Connaghan, had to say about this bill in a recent speech he made in Victoria. He said, "Let me be frank and say…"

MR. CHABOT: Big contractors.

HON. MR. KING: "…that the association I represent, whose sole function is labour relations and whose members are all unionized contractors, both large and small, does not oppose the bill in principle although we are concerned about certain aspects of the bill."

This association made their concern known to me when they visited my office and proposed some changes in the bill. Mr. Speaker, I have accepted some of those changes. There will be a guarantee that local school boards and local municipal councils will not be bound by this legislation. We recognize that they are independently elected bodies, and while we encourage them to take the same route that we are taking, we feel that they should be free to pursue their own business as they are elected independently.

Interjections by some Hon. Members.

HON. MR. KING: Now, Mr. Speaker, I don't know what the Opposition wag doing tonight during the supper hour, but they seem unusually gay tonight, It's a mood that's certainly in contrast to the sullen prognostications that were made just before the lunch hour — the roof was all going to fall in — we were taking everyone's rights away. The wall of hysteria that greets us on the other side now, makes it look like they really weren't too serious about their submissions that we're going to take rights away from individuals.

Now, Mr. Speaker, the little group of Liberals over there — I forgive them for the rather wild assertions they made. I forgive them for two reasons. The first is because they are Liberals, and as such, I doubt that the Member for West Vancouver–Howe Sound (Mr. Williams) or the Member for Vancouver–Point Grey (Mr. McGeer) — either one — have really got that much insight into the workaday problems that prevail in the heavy construction industry in British Columbia.

I forgive them also, Mr. Speaker, because they're mainly lawyers and they don't seem to understand legislation. Or perhaps it's just that they don't do their research and read the legislation as it existed before the introduction of this bill. They're obsessed, Mr. Speaker, with broad, sweeping powers when in matter of fact, the identical wording that's contained in this bill with respect to powers of search and so on was contained in the previous legislation and certainly there was no problem — never a complaint about abuse of powers, even under the reactionary administration that preceded this one. So I think that's lawyer talk, and I really don't pay much credence to it.

I should dwell, I think, just for a moment on the rationale for this legislation. The whole thrust of the opposition's attack has been based on the premise that people don't want to belong to trade unions. This has been, the whole thrust — the paternalistic approach, you know. At one point I expected them to come forward with the statement that, "some of my best friends are trade unionists." Then you know it would have been all complete. They are the protectors over there. But here we are…

Interjections by some Hon. Members.

HON. MR. KING: Here we are talking about the workers' rights, and surely no one would suggest in today's society that the workers can find a better vehicle for regulating and protecting their own interests than the bargaining table, And this is all we are suggesting — that we believe in that concept. We prefer to do business with employers who have a collective agreement, and I certainly make no apologies for that.

It's true that in the construction industry unions have had a great deal of difficulty organizing and gaining certification. This is true because these employers form companies to take advantage of one particular contract.

They are not a constant employer. As a result, it is most difficult for a trade union to gain certification under those circumstances. Certainly we are putting

[ Page 2421 ]

our money where our mouth is. We are suggesting that we believe in good labour relations in this province; we encourage it in the private sector. And when we are going to expend the public's money, either through our Crown corporations or through departments of government, then we believe that it is incumbent upon us to demonstrate that we would prefer to do business with a group of employees who enjoy full collective bargaining rights with their employer.

Now, as far as individual rights are concerned, if an employer does not wish to enter into a collective agreement with his employees, fine, that's his business. But we do not have to do business with him, so we are not forcing anyone to do anything.

Interjections by some Hon. Members.

HON. MR. KING: We are simply saying that this Government will patronize those people who are fair to labour, fair to their employees, and do not hold the patronizing, condescending, paternalistic attitude of the Social Credit Party.

Some of the remarks, Mr. Speaker, that have been made today, particularly by my Liberal friends, were altogether scurrilous — particularly coming from lawyers. They were facetious; they were specious, and I think they were a shameful demonstration from the Liberal Party. Again, Mr. Speaker, I simply have to reject them as holding any credibility whatsoever.

MR. SPEAKER: Point of order? What is your point of order?

MR. D.M. PHILLIPS (South Peace River): The man is delivering a figment of his imagination, and I wish he would withdraw.

MR. SPEAKER: Order. I don't think the Hon Member has been impugned as far as I heard, I didn't know you were a Liberal. (Laughter). He was attacking the Liberals at the time, so don't jump so quickly.

Interjections by some Hon. Members.

HON. MR. KING: Well, Mr. Speaker, there's a Member over there now who apparently feels that he can debate the colour of my shirt, and that's more relevant to this debate than my remarks. This is just amazing.

Anyway, Mr. Speaker, I submit this is good legislation, and I certainly take great pride in moving second reading.

Motion approved on the following division:

YEAS — 34

NAYS — 15

PAIRS

Bill No. 153 referred to a committee of the whole House at the next sitting after today.

HON. MR. BARRETT: Second reading of Bill No. 19, Mr. Speaker.

IRON BOUNTY ACT REPEAL ACT

HON. L.T. NIMSICK (Minister of Mines and Petroleum Resources): Mr. Speaker, I thought it was never going to come.

In moving second reading of Bill No. 19, Iron Bounty Act Repeal Act, if you remember, this bill was on the statute books for the purpose of starting up a steel industry in the Province of British Columbia. In 1961 I believe it was, they managed to get Cominco to take on the job of setting up a steel mill, and they gave them the bonus. This incentive has had a sad experience though because the steel plant lasted just as long as the incentive lasted.

I will say that they were unfortunate in having an explosion in the plant — then they said it was not viable to continue on. There was nothing to do with tailings because you still have the tailing ponds there, the way they were at the start. During those years they used the waste, the tailings from out of the mine to operate the steel plant. But that's what happened to it. At that time we were given $5 per ton and $3 and $2 — $5 per ton where royalty or tax had been paid.

We paid Cominco $1,224,000 out of this bill. Now our philosophy, Mr. Speaker…

[ Page 2422 ]

AN HON. MEMBER: You're all wet.

HON. MR. NIMSICK: …is that if we're going to use the taxpayers' money in industry then we want to have an equity to the full extent, the same as any other investor.

MR. A.V. FRASER (Cariboo): Sure.

HON. MR. NIMSICK: We want the people of British Columbia to be treated in exactly the same way as any other private investor. If they need the money for these operations, fine and dandy. We may assist them or participate. But it will be on a participation basis.

In going along with our philosophy, the repeal of this bill extends to this point.

MR. SPEAKER: The Hon. Member for Boundary-Similkameen.

MR. FX RICHTER (Boundary-Similkameen): Mr. Speaker, in speaking to the principle of this bill, the Iron Bounty Act Repeal Act, the Iron Bounty Act was an Act brought in by the former government to create an incentive to utilize iron ore in the Province of British Columbia by converting it into pig-iron and into bars to supply rolling mills within the province — shapes and forms; to bring in some form of incentive because of the low grade ores that we do have; to use waste dumps that had been accumulating over the years, thus creating more jobs.

The present Government's philosophy is to pick up businesses in the woods industry so far and certainly in the mining industry where they have either gone broke or have appeared to have a questionable future. There has been no compunction on the part of the Government in entering into these phases of industry, as they say because of the social aspect — to create jobs; no matter whether you lose money or not.

The iron bounty was paid for not more than 10 years and it was paid only on production. It was not just a gift. They had to produce or they didn't get any pay for it. It certainly created interest.

We're not in as fortunate a position as other parts of Canada such as Labrador, Quebec and Ontario where they have much higher grade ore. We also have a freight rate differential which doesn't work to our advantage, certainly as far as shipping east is concerned. And certainly we needed to create more secondary industry within the Province of British Columbia so that we would supply some of our requirements rather than having to order from eastern Canada.

I have always felt in the past that charity begins at home. Any incentive that a government can create to bring about further processing of our ore bodies, our wood products or any other natural resource which is being extracted within the province…

This has certainly helped the situation as, far as iron ore is concerned, not only in the area of Texada Island but also up at Tasu. It has been an assistance in keeping a lot more people on the job and making it possible to produce a product which otherwise would have just remained in the ground or else been thrown into the waste pile.

I think that the Minister of Mines and Petroleum Resources is fully conversant with the benefits that did accrue right in his own constituency in which it was situated. The official Opposition is very much opposed to having the Iron Bounty Act repealed. We feel that it can create a lot of benefits; it can create a lot of ancillary industries and services throughout the province. As long as you can keep people working so that they can earn their livelihood, I think the amount that is paid, especially when it was paid on the basis of production, is not a bad type of legislation.

I am very sorry to see this Act being repealed through this bill. I certainly will vote against it.

MR. SPEAKER: The Hon. First Member for Vancouver–Point Grey.

MR. P.L. McGEER (Vancouver–Point Grey): Mr. Speaker, I just want to make an observation with regard to this Act, and it's a philosophical one — namely that we're removing incentives to companies for performance. So often in the House we've discussed the need to process our ore. This particular Act was designed to encourage that kind of thing. So we preach processing of ore on the one hand but we raise taxes on the other. We talk about the need to develop these new manufacturing industries in British Columbia; yet we punish performance. On the other hand, we reward non-performance. If a company fails, as they failed at Ocean Falls, we pay money to save jobs.

AN HON. MEMBER: Public money.

MR. McGEER: Public money, as the Member says.

Haven't we, Mr. Speaker, got something completely backwards in British Columbia to reward non-performance and punish performance; to remove incentives from companies to do the very things that we've asked them to do all these years while with the other hand we raise taxes? Mt. Speaker, is it any wonder that people claim the NDP are "economic illiterates"? Is it any wonder at all?

The Minister is laughing, Mr. Speaker. He thinks I say this in jest. Well, I can tell you this, Mr. Speaker: the mining industry isn't laughing in British Columbia — they're groaning. I refer, Mr. Speaker, to the ones who are still left. The Minister will be chuckling when they're all gone. I don't think that there'll be enough

[ Page 2423 ]

money left in the Treasury to save all the jobs that will disappear.

Mr. Speaker, I hope that the Minister of Mines and Petroleum Resources has got something figured out here, because everything that he's getting across so far is negative — including this bill.

AN HON. MEMBER: Right on!

MR. SPEAKER: The Hon. Minister closes the debate.

Oh, I thought the Hon. Member had spoken.

MR. CHABOT: No, I haven't spoken yet, Mr. Speaker.

MR. SPEAKER: You've been doing a lot of speaking from your seat, but go ahead.

MR. CHABOT: I've just arrived in the House, Mr. Speaker.

MR. SPEAKER: It must have been somebody else then. I'm afraid I must have confused you with somebody else.

MR. CHABOT: Mr. Speaker, I never thought I'd see the day we'd be speaking about the Iron Bounty Act Repeal Act — a double Act. I never thought I'd see a Member from the Kootenays attack the Kootenays like the Member for Kootenay has tonight; attack jobs of the people of the Kootenays, an area which has been a depressed area over the years — the Fernie area where they were working many years ago on a three-day week.

I used to remember the Minister, when he was a Member of the Opposition, standing up in this Legislature pleading on their behalf for jobs in the mining industry. Today he sits there on the Treasury benches as a cabinet Minister, happy with his fat salary.

MR. PHILLIPS: Scandalous.

MR. CHABOT: No longer caring about the little people who make wages. No longer does he have any consideration for the little guy, because he's a cabinet Minister today at a salary of — what's the salary now?

MR. PHILLIPS: $75,000.

MR. CHABOT: A shocking salary — $44,000 plus expenses. No longer any consideration for the little guy.

Really when one looks at the Kootenays — and I come from the Kootenays; that's my home. But I don't come from the area where the jobs are created, Mr. Speaker. He does. I have to say that no longer does he care about the working people of his riding. Because he's repealed the right of work, the right of enjoyment of work, the right of income within his riding.

It's a shocking example for a Member who used to plead for the working man in this Legislative Assembly — who now, since he's become a Minister, no longer has any respect for the working people of this province. Now he's a fat cat with a big, fat salary.

From 1949 until 1972, I remember so well, he used to speak for the plight of the working man in this province. He's forgotten those working people since he's been a Minister. No longer will he go back to the Kootenays and tell them. He won't dare go back and tell those people in the Kootenays that he's against the smelter that existed in Marysville that created jobs, that contributed more to wages than the kind of bounty, the kind of incentive that the government of yesterday had established to create jobs in British Columbia.

British Columbia is not a province rich in iron ore. You couldn't possibly, with all the iron ore that has been established in British Columbia, establish a foundry in British Columbia. But yet Cominco, through its accumulation of tailings over the years was able to establish an industry to create jobs for people in the Kootenays. Yet the Minister from the Kootenays is against the people who have had these jobs in the Kootenays.

MR. PHILLIPS: A fat cat.

MR. CHABOT: I remember that Government — and I have listened to them for many years…

Interjection by an Hon. Member.

MR. CHABOT: Now we've just heard a chirp from the Minister of Lands, Forests and Water Resources…Recreation, Conservation, condominiums — the Minister of everything — chirp up. Is he chirping up against the people of British Columbia, the right of people to work and earn wages? Or is he chirping up for people to be on welfare? Is that his reason for chirping up here tonight? What does he stand for — wilderness parks or jobs for people? He'd better make up his mind which is most important.

Interjection by an Hon. Member.

MR. CHABOT: No, no, Mr. Minister, you've said …

MR. SPEAKER: Would you struggle back to Bill No. 19, please?

MR. CHABOT: Yes, I will. But I just have to reply to the Minister. He asked if I am against those

[ Page 2424 ]

wilderness parks.

MR. SPEAKER: Well that's not to do with Bill 19.

MR. CHABOT: Mr. Speaker, I have to reply to that Minister. I want to say that the answer is no, I'm not against wilderness parks. But I believe in jobs for the people of British Columbia. That Minister of Mines, not only by this legislation but by many, many, many, many, many other pieces of legislation in this province, has indicated very clearly to me and to the people of British Columbia that he's against jobs, against gainful employment for people.

The Government has stood on its feet many, many times over the last many, many years and said that we must utilize our natural resources in British Columbia; that we shouldn't export our natural resources in the raw state; we must create jobs in British Columbia. Yet that Minister, by the repeal of this Act, has indicated very clearly the position of that Government relative to the development of raw materials and natural resources in British Columbia. He's against the development of jobs in British Columbia.

I want to tell you that this party believes that our natural resources should be refined in British Columbia and not exported in the raw state. From time to time it's necessary to do so, but we don't believe in the export of our raw materials to another nation like that Government does. I want to assure you that this bill means the export of jobs in British Columbia. We'll never support that.

MR. SPEAKER: The Hon. Second Member for Victoria.

MR. D.A. ANDERSON (Victoria): Mr. Speaker, after listening to that impassioned plea from the Member for Columbia River, I checked the public accounts of British Columbia for the last year in which the Social Credit government handled such things as the Iron Bounty Act. On page D37, vote 178, Iron Bounty Act, RSBC (1960), ch. 200, section 2, all expenditure — zero.

I was impressed. I thought that was a great speech on the basis of zero assistance under the Iron Bounty Act. I thought he did a good job. He spoke well and at great length and with great passion about what the previous government had done, and it turned out to be absolutely nothing. So we have Social Credit who gave nothing and I guess in some way the NDP is taking nothing away.

But what we think is important is again a question of philosophy. Is it this Government's intention to cut out incentives of this nature and then, when companies fail, march in, rescue them with $1 million or no dollars, take up their debts, attempt to keep the jobs going — if there are jobs involved — by way of public enterprise when it would be possible perhaps to deal effectively by way of incentives and assistance in partnership with the private sector? Apparently the philosophy behind this repeal Act is just that — they want to follow the lead already established in the forest industry with Ocean Falls and Columbia Cellulose.

Interjection by an Hon. Member.

MR. D.A. ANDERSON: The Minister says "order." Of course he doesn't want things like this discussed. It's the same type of attitude which we feel has been shown up in previous decisions of this Government and therefore we are against it.

We feel that there is some far better way of having incentives, some way of the public actually knowing what money has been spent, what money will be pumped in to assist any industry in the creation of jobs or anything else so that they know full well what the cost is. What we are getting instead is "loser" corporations which no doubt will have their balance sheets thoroughly hidden away.

We look forward to the comments of the Hon. Minister. I am sure he'll have no trouble in protecting the non-existent jobs under this in his own riding which were assisted not at all by the previous government by way of a vote which they never spent. But we do think in terms of philosophy we should get some statement from him as to what his attitude will be in future towards the mining industry in cases such as this.

MR. SPEAKER: The Hon. Minister of Mines and Petroleum Resources closes the debate.

HON. MR. NIMSICK: Mr. Speaker, I listened to the Hon. Member for Columbia River and I was almost weeping at the time.

MR. CHABOT: You should be.

HON. MR. NIMSICK: Weeping for him, because if anyone knows about "fat cats" he should know — because he got starved out last August.

Mr. Speaker, when they talked about the incentives that this created, it was a failure — the incentive that was paid out on the Iron Bounty Act. It was a failure because it ended with nothing. There is no steel mill in Kimberley at the present time.

Interjection by an Hon. Member.

HON. MR. NIMSICK: I for one was sorry that you didn't succeed. But now that you have failed to make these incentives work and build up secondary industry, give us a chance now in our philosophy of doing these things. We're going to have incentive for

[ Page 2425 ]

them but if we're going to use up any of the taxpayers' money then we want to participate.

As the Hon. Second Member for Victoria (Mr. D.A. Anderson) said, we should participate. That's exactly what we are attempting to do.

I move second reading of this bill, Mr. Speaker.

Motion approved; second reading of the bill.

Bill No. 19 referred to a committee of the whole House at the next sitting after today.

HON. MR. BARRETT: Second reading of Bill No. 20, Mr. Speaker.

COPPER BOUNTY ACT REPEAL ACT

HON. MR. NIMSICK: Mr. Speaker, I move second reading of Bill No. 20, Copper Bounty Act Repeal Act. Now this is exactly the same as Bill No. 19 except that it never did come into existence so your incentive didn't work.

MR. SPEAKER: The Hon. Member for Boundary-Similkameen.

MR. RICHTER: Mr. Speaker, in speaking to the principle of Copper Bounty Act Repeal Act, the Minister is quite correct. He saw to it that the Copper Bounty Act didn't function. It was the philosophy of that Government over there that made it very evident when there was a contract, an agreement signed prior to that Government's being elected, for a copper smelting plant to go in exactly where the steel smelter was…one of the units that Cominco had there — they had two units — was going to be converted to use in the smelting of copper.

There is no question but what with the smelting, refining and fabrication of copper, that is the mineral standing highest on our production of minerals within the province. Many of the mines are low-grade copper mines, very questionable if they could operate if it were entirely based on copper. It had to be on the other anomalies that were involved to make them profitable.

At least they were creating jobs. There was another study being made for the Cariboo, and hearings had been taking place in Kamloops under the Environment and Land Use Act. It was the intention that a consortium of companies would establish a copper smelting unit in that area, but they had to meet the criteria that were being set down as far as environmental and pollution control were concerned. With the policy of the NDP Government they were quick to realize that it would be. utterly hopeless to attempt to work under that sort of a regime, and the whole matter was dropped.

So it isn't a fact that the Copper Bounty Act didn't work. It wasn't given the opportunity to work, which it would have been given under a Social Credit government. We would have had refining; we would have had fabrication, rather than having to bring copper in from eastern Canada and other areas — even to the extent where copper concentrates are being shipped out of the country, and coming back as plate, tubing and wire. We could just as easily have made that right here in British Columbia.

We are very opposed, the official Opposition, to the repeal of this incentive. It was based very similar to that of the Iron Bounty Act. It was not a high bounty; in fact it was quite a low bounty. But it was the implement with which copper smelting could have come about here in the Province of British Columbia.

Now with the repeal of that Act we are finding that there is little or no interest, except as far as the Government is concerned — who are quite prepared, from statements made by the Minister, to go into the smelting industry.

Now here again it's a high-risk industry. Certainly it will create jobs, but it has got to be the taxpayers' money that does this, where free enterprise was prepared to take the risk and to go into it in conjunction with their mining operations, and bring about an extra secondary industry which we need very badly in this province. We will oppose the repeal of the Copper Bounty Act.

MR. SPEAKER: The Hon. Minister closes the debate.

HON. MR. NIMSICK: Mr. Speaker…

MR. SPEAKER: Order. Well, you have to be on your feet you know. The Hon. Member for South Peace River.

HON. MR. NIMSICK: Mr. Speaker, I was already speaking when he…

Interjections by some Hon. Members.

MR. SPEAKER: That is disrespect of the Chair, because I would recognize the Hon. Member even if you had started to speak. Proceed, Hon. Member.

MR. PHILLIPS: Yes, Mr. Speaker, thank you very much. I would like to put on the record certain things that were said by the Northern Miner, which is a Canadian mining magazine, which seems to sum up the situation of mining in British Columbia. This is very apropos, Mr. Speaker, because it is entitled "More processing: a great idea, but how to do it?"

This is the very thing we are debating here in this Legislature tonight. All of us in British Columbia would like to see all of our minerals processed in the province. This was certainly the attitude of the

[ Page 2426 ]

previous administration, and I am sure it is the attitude of this administration. But before we can do this, we have to have our feet on the ground, we have to be practical and we have to face realities.

I'd like to read to you, Mr. Speaker, just a short note from one of the Toronto newspapers. It says:

"It would be much better if the federal government would reform its tax policies to encourage or coerce resource development to do more processing in Canada, with the same law applying to all provinces. And while the country waits for Ottawa's action, the Ontario government should protect its interests by seeing that more refining and processing of raw materials is carried on here, rather than abroad.

"So says the Toronto Star, a publication that has never distinguished itself for its knowledge of mining…"

It reminds me of the Government, Mr. Speaker.

"…or the support it gives to the mining industry. In calling for more processing of minerals in Canada, the Star is echoing the sentiments of a great many people in this country, including the mining industry, which would like nothing better than to dispose of the bulk of its profits on the home market."

Mr. Speaker, this article continues:

"But the Star parts company with people of common sense, and joins the ranks of starry-eyed academics and theoreticians such as Mr. Kierans and Premier Barrett of British Columbia, when it inferred that if the government would only show a little muscle, those primary producers could be made to get down to business and start producing manufactured products."

Mr. Speaker, that is a very good idea — more processing of our minerals here in this great province.

But the question we have to ask each other is how we do it. I could certainly agree, Mr. Speaker, with the theory of the socialists opposite, when we should be deriving more profit and have more people working on our natural resource profits. But we seem to be of the opinion. Mr. Speaker, that all the resource industries in British Columbia are prone just to dig up the natural resources and ship them away. I am sure, Mr. Speaker, that this is not the case. I am sure, Mr. Speaker, that they would rather see the raw materials processed and shipped as the refined product.

This leads me, Mr. Speaker, to wonder why they would want to repeal this particular Act. I don't think, Mr. Speaker, that the resource industries of British Columbia really want to ship out the raw product. But any industry in British Columbia, Mr. Speaker, must be practical. I realize, Mr. Speaker, that the word "practical" is not in the dictionary of the socialist party opposite. The only thing they work on, Mr. Speaker, is the word "theory," and they think, Mr. Speaker, that we can live as an entity unto ourselves. From this province we should be exporting our products completely refined. I'd like to think that that would be possible too, Mr. Speaker.

I am sure that all of our resource industries, Mr. Speaker, the ones that dig the copper out of the ground, the ones that dig the gold out of the ground, would love to make the profits that are available to those who would process our natural resources. All you have to do, Mr. Speaker, is take a look at your wedding band. Take a look at it and compare the price of your wedding band, Mr. Speaker, with the price of gold that comes out of the ground. I am sure, Mr. Speaker that those who dig the gold would love to sell wedding bands.

Take a look, Mr. Speaker, at the price of sterling silver. I am sure you will realize, Mr. Speaker, that those who sit down one evening, one Sunday evening with their families…and there are all the goodies of life and the sterling silver. I am sure, Mr. Speaker — and you know what you have to pay for sterling silver — that those who mine sterling silver, those who mine the resources of our province, would love to refine and process the product, Mr. Speaker.

Those of you who don't think they would love to do that are naive indeed, Mr. Speaker. Those of you who sit down and buy stainless steel silverware, or stainless steel products of any kind, and say that all those who mine the ore in this province just want to dig it up and export it, Mr. Speaker, have got to be completely naive.

That is what we are doing. I'll tell you, my friend, exactly what we are doing. They have got to be completely naive, Mr. Speaker, because as you say, if we are a profit-oriented society, why aren't we processing our minerals? Why don't we have the secondary industries that those theorists across the way would like to have, Mr. Speaker? I'll tell you. The first thing any government has to be is practical. Unfortunately, the Minister of Mines (Hon. Mr. Nimsick) has lost all his practicality.

MR. CHABOT: He never had any.

AN HON. MEMBER: Invest in their own popcorn stand again.

MR. PHILLIPS: Maybe, Mr. Speaker, the Premier and Mr. Kiernan should show the primary producers where they have gone wrong in this province, and indeed; where they have gone wrong in Canada. They seem to have all the answers. They are the great theorists.

HON. MR. BARRETT: Are you attacking the president of your party?

MR. PHILLIPS: I'm not attacking the president of

[ Page 2427 ]

my party. I'm not attacking you, Mr. Premier, even though I was almost sick to my stomach when I saw you on TV tonight.

Interjections by some Hon. Members.

MR. PHILLIPS: Mr. Speaker, the mining companies of this province have tried. You know, Mr. Speaker, as well as I know what a cross and a burden we have to bear in western Canada. Even the Premier goes down to Ottawa and he tries and he tries. When he first came into power he said, "I'm going to cooperate with Ottawa." How far did he get?

MR. SPEAKER: Would the Hon. Member get back to copper?

MR. PHILLIPS: The answer is yes. Mr. Speaker, I would like to point out to you that mining companies in Canada have tried to process their industries. I would like to point out to you just a few subsidiaries of Duranda Mining who have tried to process their copper concentrates: Canada Wire and Cable — known all over Canada, Canada Copper Refiners, Duranda Metal Industries, Wire Rope Industries, Saint Lawrence Fertilizers, General Smelting Industries, Cominco — right here in British Columbia, National Hardware Specialties. They have tried. Oh, how they have tried. And to discredit them, Mr. Speaker, is a slam on the private enterprise system in Canada. Hudson Bay has its own die-casting operation.

I am proud to stand in this Legislature tonight and say that the one thing the late Lester Pearson did while he was Prime Minister of Canada was to effect the Auto-pact. I have always felt the automobile industry in Canada had a great obligation and a great opportunity to supply the great industry of the United States which supplies the bulk of the automobile industry in North America. That opportunity came alive, under the Auto-pact. What happened in Ontario? Many small industries, many small die-casting industries who had ready access to cheap raw products got together — and what did they do? They created an industry in Canada so great that the President of the United States said, "We cannot continue with the Auto-Pact because…"

Interjection by an Hon. Member.

MR. PHILLIPS: I'll tell you my friend that is exactly what happened — and I followed the industry very closely. And I sat back there in those offices at Oakville as a representative of the dealers of western Canada. I knew exactly what was going on. You had better believe, Mr. Speaker. That is why the unions in the United States of America said the Auto-pact has got to go because Canadian manufacturers, were taking advantage of it. They were forming small companies and they were providing die-cast parts for the auto industry in the United States.

Interjection by an Hon. Member.

MR. PHILLIPS: That has a lot to do with this very bill we are subscribing to, Mr. Premier, and you had better believe it.

Many small manufacturing industries, Mr. Speaker, developed in the Province of Ontario. This could happen here in the Province of British Columbia. But what are we doing by repealing this Act tonight? You know what we are doing. We want…

Interjection by an Hon. Member.

MR. PHILLIPS: There is one of the bright-eyed boys in the backbench piping up. His day will come, Mr. Speaker, his day will come.

MR. SPEAKER: Order. Talk to me.

MR. PHILLIPS: These companies, Mr. Speaker, and others have failed dismally in providing an outlet for Canadian copper, lead and zinc. That has been the problem here in British Columbia, Mr. Speaker. But I want to tell you that all those theorists and all those would-be politicians and all those would-be manufacturers who would repeal this bounty Act, Mr. Speaker, have got to look at the facts.

Let me tell you some of the facts. Canadian production of copper in 1971 was 714,500 tons worth approximately $750 million. Of this only 526,500 tons were processed as refined metal. In other words…

Interjections by some Hon. Members.

MR. PHILLIPS: I'd be quite happy to give you all the facts, Mr. Minister, because it is certain to me that your hack that you have as an executive assistant will not give you the facts.

Of this, 526,500 tons was processed as refined metal. Canadian consumers absorbed only 221,000 tons — not quite half. Yet everybody says, we must process; we must manufacture; we must sell to Canadian citizens all our manufactured and refined copper — not so, Mr. Speaker. The remainder of the copper had to be exported.

In other words, Mr. Speaker, 71 per cent of the copper produced was refined and 27 per cent was exported. Yet, the Minister of Mines and Petroleum Resources (Hon. Mr. Nimsick), great guy that he is, will not face reality.

HON. D.G. COCKE (Minister of Health Services and Hospital Insurance): Point of order.

[ Page 2428 ]

MR. SPEAKER: Point of order.

HON. MR. COCKE: Mr. Speaker, in deference to the galleries — I know the MLAs have to put up with this — but as Minister of Health, our ears can only stand 105 decibels. And I was thinking in deference to the galleries, maybe we could turn down the public address system.

MR. SPEAKER: I would ask the Hon. Member to restrain his voice a little…

MR. CHABOT: They control it down there. You know that.

MR. SPEAKER: Order, please. Order.

Interjections by some Hon. Members.

MR. SPEAKER: Talking technically, I have had complaints that it is too loud. When you shout into the microphone you must be further away.

MR. CHABOT: Don't make the big time.

MR. SPEAKER: Order, please. So I would ask the Hon. Member to restrain the level of his voice.

MR. PHILLIPS: Mr. Speaker, I will certainly. I realize I get carried away when I speak so emphatically for all the people in British Columbia.

Interjections by some Hon. Members.

MR. PHILLIPS: I didn't have the opportunity on Friday afternoon. I was barred from the House — I didn't have the opportunity to speak, so I am certainly more enthusiastic tonight.

AN HON. MEMBER: You ran out.

MR. PHILLIPS: I didn't run out, my friend, you shoved me out. You shoved me out, Mr. Premier, you shoved me out and my people will know it. All the people of British Columbia will know that you shoved me out, Mr. Premier. You know it and so does Mr. Speaker.

MR. SPEAKER: Order! Would you kindly get back to Bill No. 20 — Copper Bounty Act Repeal Act.

MR. PHILLIPS: In other words, Mr. Speaker, 71 per cent of the copper produced was refined, and 29 per cent was exported. These are cold, hard facts, Mr. Speaker.

AN HON. MEMBER: We don't want to listen to your cold hard facts whether you know it or not.

MR. PHILLIPS: Regardless of what the Minister of Mines and Petroleum Resources says, these are cold, hard facts. He can live in a dream world; the Premier can live in a dream world and they can say we are going to process all the copper in British Columbia and go into cooperation with some great mining industry.

The answer is "no," Mr. Speaker, because no one's going to cooperate with that socialist, Government over there, Mr. Speaker, because no one trusts them. I predict, Mr. Speaker, that the enterprises that the Social Credit had going in providing a copper concentrator in this province will go down the drain.

MR. CHABOT: Jobs will go down the drain.

MR. PHILLIPS: And they can go on the air and on the TV and stand up and put all the shams into this House that they want to. Three years from now, Mr. Speaker, I will stand in this Legislature and I will say, "I told you so." When there are people out there at the doors of this Legislature begging for jobs…

MR. CHABOT: When you're over here and we're over there.

MR. PHILLIPS: That's what will happen, Mr. Speaker. All I can do, Mr. Speaker, is stand here in my place this evening and point out the facts to that Government. If they are naive enough not to accept them, that is their problem and that is the problem of the people who voted them to power. But next time, Mr. Speaker, there will be a change. We shall come again! We shall lead the people!

Interjection by an Hon. Member.

MR. CHABOT: Bunch of sheep in the background.

MR. PHILLIPS: I haven't seen too many of the Members in the backbench even take part in this deliberation, Mr. Speaker.

MR. SPEAKER: Order, please. What's your point of order?

MS. PR YOUNG (Vancouver–Little Mountain): I don't know how this relates to the Copper Bounty Repeal Act.

MR. SPEAKER: I wish the Hon. Member would confine himself to the principle of the bill, please.

MR. PHILLIPS: There's the Member for Vancouver–Little Mountain, Mr. Speaker, and I, certainly realize that she's got a lot of unemployed in

[ Page 2429 ]

her constituency. I realize that she speaks for a lot of union people. I realize that she wants to uphold the rules of the House, Mr. Speaker, but she's got a lot more than that to uphold, Mr. Speaker, and I'll succumb to her.

MR. SPEAKER: The Hon. Second Member for Victoria.

MR. D.A. ANDERSON: Mr. Speaker, in preparation for debate on this, Members of our party asked a number of questions on the order paper. I wonder at this stage whether it's worth dealing with the subject seriously after the previous speech.

The question is 155, which the Minister was kind enough to answer on February 15. He talked about the value of copper concentrates. Unfortunately he didn't answer many of the questions, but he did answer some. We learned from those replies that the value of the product we're talking about…

HON. MR. NIMSICK: Didn't I answer all your questions?

MR. D.A. ANDERSON: No, you certainly didn't. You kept on telling me, "1972 employment not available as yet; details of No. 2 and 3 will be available later in the year."

Interjection by an Hon. Member.

MR. D.A. ANDERSON: Oh, I live and learn. But in any event, the Minister didn't reply to a great deal, but he replied to quite a number.

We can learn from this that the value of copper as compared to the value of iron, which we discussed earlier this evening, is 20 times. It's a total of $218 million as opposed to about $11 million — a substantial amount of money. We're talking about the estimated value of copper shipments being $218 million, a royalty of nothing having being paid on those $218 million. We find out from his answer that 95 per cent of all of this goes to Japan. He nods his head in agreement. I'm glad he agrees with the reply to his own questions.

The question, Mr. Speaker, is this: We are now in the process of cutting back on subsidies; we are not in the process of cutting back on incentives; we're also in the process of raising taxes, in particular in the mining industry. The real question to which the Minister should be addressing himself tonight, apart from answering all those questions which he didn't answer here on February 15, questions such as employment… Apparently you don't know what employment figures we're dealing with, either on iron or on copper. There were questions dealing with the names and locations of all mines — apparently that wasn't available either. But in any event, those questions should be answered tonight so we know what sort of employment figures we're dealing with, because, basically, the arguments in favour of subsidies have been in favour whether or not they assist employment levels in the province.

The other question which I think he should be addressing himself to is the future of the mining industry in this province as indicated by these various bills. We're cutting out the kind of incentive which is clear, which is precise, which the public can measure. In another area, namely lands and forests, we are introducing public enterprise in a way which we feel will be unclear, which will be highly expensive, and which ultimately, we feel, will damage substantially the value of that industry and its contributions to the economy of this province by way of tax revenues.

I ask these questions, Mr. Speaker, because very recently in Manitoba a booklet entitled "Natural Resource Policy in Manitoba" has been introduced. The Minister indicates that he has heard about this. Well, he's not nodding his head now, but I thought he was. I'm not sure whether he has or not.

It's a booklet put out by Prof. Eric Kierans at the request of the Manitoba government. It states, Mr. Speaker, that the Manitoba government must become the sole mine owner, ore miller and mineral prospector in the province. The Minister will recall that I asked similar questions of him during his estimates. But that was before this booklet came out. I quote it again: "The way to do this is to increase taxes on mining companies to such an extent that they will eventually leave in disgust."

So we have a situation in Manitoba, a fellow NDP province, where the recommendation is that they tax people so they'll pull out. Then, of course, the government can take over. This is a more sophisticated approach than that adopted by the Hon. Minister of Lands, Forests and Water Resources (Hon. Mr. Williams) of British Columbia, who apparently is willing to throw good money after bad.

According to this article, which is by a Mr. Hill of Southam News Services — I think it's in today's Vancouver Province — the only debate in Manitoba deals with the time period in which these companies are going to be forced out. Sidney Green, a man of considerable ability who in many respects resembles the Minister of Lands, Forests and Water Resources, indicates that 10 years…

Interjections by some Hon. Members.

MR. D.A. ANDERSON: Wait a sec. Instead of repatriation over 10 years- through heavier taxation, Green wants direct expropriation of all mineral assets. This would be simply a report, Mr. Speaker, if the Premier of Manitoba had not vigorously defended this type of approach. He refers to this report when he says, "It" — that is, the report — "will influence the

[ Page 2430 ]

thinking of more and more Canadians. It is a report for all Canada and Kierans has done Canada a service."

Well, I would think that if there's any part of Canada where this might find an echo and a sympathetic hearing, it would be in another NDP province which is at the present time engaged in substantially altering taxation of mining, wiping out of subsidy programmes, and all-round leaning on the industry in the same way that Manitoba is apparently doing, although at this stage not to the same degree.

So it indicates, as Mr. Hill says, "Could there be higher praise? Could there be clearer indication that Schreyer will act where Kierans has recommended?"

We think it's only fair that if we're asking people to work in this province and to invest in this province, as I'm afraid the mineral and mining industry must, they should know more about government intentions — much more than the Minister has indicated in his reply to these two questions. His reply is dated February 15. The two questions were asked by my Hon. friend, the Second Member for Point Grey (Mr. Gardom). The questions there were not answered properly.

We're dealing with copper in this instance, an industry which has produced $218 million worth of shipments last year. I think it only fair that in summing up this debate, the Minister should not only indicate why he's wiping out this subsidy programme — or I should say "would-be subsidy programme" because as yet nothing has been paid under it — but indicate the change in philosophy that he is introducing in the area of copper, which perhaps will result in many of these major companies and many of these mines going the way of the mines in Manitoba.

We have Bethlehem Copper, which in Highland Valley produces a tremendous amount — 90,000 tons; Craigmont; Utah Mines, Granduc…

AN HON. MEMBER: Valley Copper.

MR. D.A. ANDERSON: Valley Copper is not among the major ones. I'm just listing the top ones. There are a great number here. There are approximately 20. I would like to know which ones of those companies are to be taken over, if they are to be taken over. What is the effect of government taxation policy and the attitude of the government toward these companies?

It's happening in Manitoba. Apparently the report I mentioned has the approval of not only Sidney Green but also the Premier. In this province we simply don't know and it's not knowing which I think is most damaging to the mining industry.

MR. SPEAKER: The Hon. Member for Columbia River.

MR. CHABOT: Mr. Speaker, this is a very simple Act, really. It has one section to it. In that section there are only 16 words. But, in my opinion, those 16 words crucify the ability of government to create jobs in British Columbia, because they destroy the ability of government to promote the development of jobs in the copper refining industries in British Columbia. It's very simple.

It spells out to me very clearly that the Government is not interested in creating jobs in British Columbia. Part of the Government, the existing socialist right-wing…(Laughter)…left-wing Marxist government coming into office in British Columbia, Mr. Speaker…

There was an agreement established under this legislation which is presently being repealed between the former government and an outfit called CM&S, which I know…

AN HON. MEMBER: Cominco.

MR. CHABOT: Cominco, yes. It's no longer CM&S. I'm sorry. I apologize for that. It used to be CM&S. I recognize it as that but it's got a new name. It's Cominco now. Right.

They're a big business. I'm an employee of their parent really. I've been an employee of their parent all my life. When I was a little boy, I was hired by the CPR — when I was a little French boy in the Province of Quebec. I started to work for a living…

AN HON. MEMBER: What has that got to do with copper?

MR. CHABOT: Well, it has a lot to do with it. I'm talking about…I was going to say "CM&S" but I'm talking about Cominco.

Of course, I was loaned from the Province of Quebec to the Province of British Columbia in 1948. Consequently, they thought that they needed people like me in British Columbia and I decided to stay. I tried to save the people of British Columbia from the type of government we have today. I'll continue to fight against that type of government as long as I can speak.

The Premier can look up in the Press gallery and try to say, "Oh, what a shocking statement that Member for Columbia River has made. It's irresponsible, it's unbelievable that he would make such a statement." But as a workingman, I want to speak up for the working people of this province. They should have a right to enjoy the possibility of job creation. This legislation, the Copper Bounty Act Repeal Act is against …

MR. LAUK: Are you driving tonight?

MR. CHABOT: Mr. Speaker, I want you to have

[ Page 2431 ]

that Member withdraw that statement because I don't take that from a two-bit…

MR. SPEAKER: Order, order, order, please. One insult should not draw out another. If you want the one retracted, I think the best thing is to treat it courteously. Would the Hon. Member retract that remark? The one you made. Withdraw, please.

MR. LAUK: I'll withdraw the remark. I asked whether he was driving tonight. It was a simple remark.

MR. CHABOT: A simple remark. Simple for you because you have a simple mind.

MR. SPEAKER: Order. Now you're…

MR. CHABOT: Going on to speak about job creation in British Columbia …

MR. SPEAKER: Would the Hon. Member be as gracious and withdraw his remark?

MR. CHABOT: Are you defending that Member?

MR. SPEAKER: I defend all Members.

MR. CHABOT: If that Member believes that I've offended him, he should stand up and say so. You shouldn't run to his defence.

MR. SPEAKER: I try to keep an orderly House but it's not easy.

MR. CHABOT: I'm talking about the creation of jobs. Prior to this Government coming to office, there was a word-of-mouth agreement between the government and CM&S, or Cominco as you call it. I'll always know it as CM&S. It was an agreement of some sort for the establishment of a copper smelter in the Kimberley area at Marysville for the conversion of the iron smelter situation to a copper smelter situation, where jobs would have been created.

Of course, because of their involvement in the copper mining industry in British Columbia, it appeared very well that jobs were going to be created in that particular area. Also there was an understanding that there would be a copper smelter established at about 70 Mile House in the lower Cariboo. That's gone by the wayside since you've become Government.

What the legislation really means is the denial of the creation of jobs in British Columbia for working people. I don't think that we have any hang-ups about job creation. I think that every party in this Legislature is interested in job creation. I think that party over there, Mr. Speaker, is just as interested as we are in creating jobs in British Columbia. Every party in this Legislature has as its number one priority creating jobs for working people.

I think that the repeal of this Act is going to deny those people who want to work in British Columbia the ability to find jobs. Not entirely, really, but a certain new number of jobs — I'm going to use a ballpark figure. When I use that ballpark figure, I'm going to look at Marysville and 70 Mile House and I'm going to talk about 500 to 600 jobs in British Columbia which are very important. It's a ballpark figure, Mr. Minister. You can shake your head if you want. I'm talking about the two situations.

When I look at the unemployment situation, the latest statistics which are available to us, there were 81,000 people unemployed in British Columbia in February, 1973. I'm talking about the creation of 500 to 600 jobs. I'm sure that of those 81,000 people who are looking for gainful employment in British Columbia, many of them would be willing to work in a copper refining process, either in Marysville or at 70 Mile House.

You could find the number of people that are necessary. I don't know if they'd have the abilities. This I can't prove. But you'd find the number of people within those 81,000 people to operate two smelters — one at Marysville and one at 70 Mile House.

Really, I don't believe that establishing a copper smelter is that lucrative a business. I think it's a marginal business; even with the bounty that was in place it was a marginal situation. Nevertheless, it would create jobs. That's why, even though there was an agreement in place with Cominco at Marysville in August of 1972, and there appeared to be in place the establishment of a smelter at 70 Mile House in the Cariboo, there appeared to be on the horizon the establishment of between 500 and 600 jobs. Those jobs have disappeared.

Those jobs are no longer on the horizon because of the attitude, the approach and the legislation of that new Government we have in British Columbia. People are being denied jobs and the ability to work in British Columbia.

Not too many hours ago, we listened to the Minister of Labour (Hon. Mr. King) talk about the compulsion about unionism, about the necessity for everyone working for the government to be a union member. No longer can anyone who bids on a contract in British Columbia have the right to work on a contract held with this Government.

Relative to the Copper Bounty Act Repeal Act, all I want to say is this, Mr. Speaker. If it means the creation of jobs for people and it's absolutely necessary that they belong to a union — if it creates new jobs, I support it. I support it even though I don't believe in that kind of a concept. But if it's new

[ Page 2432 ]

jobs and the Act that we passed not too long ago, against my wishes…. . I'm not going to reflect, Mr. Speaker, on an Act that was passed a little while ago. You know I'd never do that, Mr. Speaker. I'd always abide by your regulations and your wishes, Mr. Speaker. That's paramount in my vocabulary and my thinking — to abide by the wishes of the Speaker.

If it was necessary to create jobs for people to impose compulsory unionism, I'd have to support it, despite the fact that it's against my way of thinking. I'd have to support it if it meant new jobs.

Mr. Speaker, when the Minister stands up and closes the debate, which I know he's going to do very soon, I want him to tell me and the people of British Columbia, for a Government that is opposed to the export of raw materials from British Columbia, what that Government proposes to do relative to the refining of our raw materials in British Columbia and the creation of jobs for people; because I'll have to come to the conclusion that what they've said in the past, what they've led the people of British Columbia to believe is their principles and their philosophy is a bunch of double-talk.

And I want to hear from the Minister when he closes the debate what the true intent of that Government is, whether he really believes in what they've been saying over the years, or whether it's only political verbiage, Mr. Speaker.

MR. SPEAKER: The Hon. Member for Oak Bay.

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, after the long orations tonight, I'll be extremely brief. I sometimes have to really shake myself to realize what has happened in this House — that it was only last year that the sides were completely reversed on the whole question of copper concentrates. With respect, Mr. Speaker, our Honourable Premier year after year after year always had a question on the order paper about the value of copper concentrates leaving British Columbia. He always made a speech which was, in some ways, similar to the one we've just had — rather noisy and flamboyant and demonstrative.

Anyway, instead of wasting any more time, I really do feel that the Minister should answer to the House about what is such a contradiction of what he and the Premier frequently spoke about when they were on this side of the House:

(1) we should be getting more money from our copper concentrates;

(2) not only should there be a royalty but we should encourage, as this bill was originally intended to do, the creation of a smelter to refine our products, not only to make better use of our resources but, as the Member has just said, to create jobs.

I find it very puzzling, very puzzling indeed, Mr. Speaker, that here we are — the sides have just switched over from 37-12 to 38-10 — and here we now have the Social Credit Party criticizing the NDP for the very thing that the NDP criticized the Socreds.

Well, I'd like an explanation. Perhaps the Minister can explain it. But it seems to me that the speeches are just the same. They're just coming from different sides of the House.

MR. SPEAKER: The Hon. First Member for Vancouver–Point Grey.

MR. McGEER: I don't intend to delay the Minister long in summarizing the debate on this bill. But, Mr. Speaker, I wanted again to raise with the Minister a matter of principle which I raised first under his estimates: namely the desirability of attempting to adjust the mining activity in British Columbia to a desired level of employment and exploration, and the need to use taxation in a creative way to achieve this level, whatever it might be.

The difficulty with a copper bounty, whether you include it or exclude it, is that the copper bounty itself is small in comparison with the value of the mineral if its price on world markets shift by 5 cents or 10 cents. I've forgotten how many millions of dollars each cent on the price of copper means to the profits of Bethlehem Copper, but it's very, very large.

Interjection by an Hon. Member.

MR. McGEER: I don't know, Mr. Speaker, whether the Minister of Highways (Hon. Mr. Strachan) is trying to make a conversion over here or if he just feels more comfortable on the Opposition side. I'll say this, Mr. Speaker, that the Minister of Highways made many more outstanding speeches on this side than he ever did on that. He's just been a strike-out on the other side. If he's trying to regain his form we think that's fine that he be over there, but he should listen for a while on this side, Mr. Speaker.

In any event, I was speaking through you, Sir, to the Minister of Mines, saying that in the forest industry there are sliding scales of stumpage under the control of the Minister so that he can set it at any level that he likes, week by week by order-in-council. But because it is on a sliding scale, when prices are good the proportion which comes to government is higher; when prices are bad, the proportion which comes to government is less.

Now if that is a good policy in forestry, why isn't it a good policy in mining? Why don't we have a sliding bounty, so that if the price is very good what comes to Government is…

[ Page 2433 ]

Interjection by an Hon. Member.

MR. McGEER: Oh, you're going to tax stuff in the ground before you even get it out. You're following the Kiernan line; you want to drive mining right out of the province.

I'm talking, Mr. Speaker, about policies which will encourage mining and still bring good income to government. And, Mr. Speaker, it is quite possible that if the value of copper were to drop below a floor price, the government might even consider it good economics to support a base level of copper production up to a certain maximum number of dollars per year in order to preserve jobs and keep the mine functioning.

But in any event, it makes much more sense to have a sliding scale than it does to have a bounty, whether it's included or excluded.

I don't think the Act was a good one in the first place and I don't know if it's wise to remove it. But I do know that we've got to put a lot more common sense into our mining policies than we have today And I just hope that along the way, Mr. Speaker, the Minister of Mines can find his.

MR. SPEAKER: The Hon. Minister of Mines closes the debate.

HON. MR. NIMSICK: Mr. Speaker, you know, I just don't think that the speakers over there really mean what they were saying. They didn't put that extra in it to make it convincing at all. I'm sure that if the mining companies are listening to you tonight, they will be very disappointed in how you've been speaking.

You know what you're doing? The other day we were debating welfare rates and what the Hon Member for Columbia River has been talking about is jobs. But in order to have those jobs he was appealing to the taxpayers of this province to donate to private enterprise, to the very enterprise that you people tell me is so successful in this country.

You've told us that it was very successful.

Interjection by an Hon. Member.

AN HON. MEMBER: What did you do at Ocean Falls?

HON. MR. NIMSICK: Well, he just got through saying we should get a support price. Now we took over Ocean Falls to save jobs.

Interjections by some Hon. Members.

HON. MR. NIMSICK: We're not donating anything to them.

Some Hon. Members: Oh, no!

HON. MR. NIMSICK: No. Donating nothing.

Interjection by an Hon. Member.

HON. MR. NIMSICK: But to appeal to the people of British Columbia to give a subsidy or a donation to private enterprise I think is wrong. And then we talk of Cominco that the Hon. Member was talking about, that was the Liberal government from Ottawa. The Liberal government has wasted the taxpayers' money all over the country.

And the Social Credit — it was the Hon. Member for South Peace River (Mr. Phillips) who was saying how private enterprise tried to process the ore in this country; they tried for 20 years under Social Credit and never got to first base processing any of our minerals.

And don't ever think that this question of processing our minerals is dead. It's very much alive today, and we had some real discussions with Cominco. I know that you were on the verge of letting them have $2.5 million of the taxpayers' money to institute a copper smelter, but we said "no go" in this regard. "We'll give you the $2.5 million, but we want an equity." If we are going to invest the people's money then we must have an equity. We're not donating it.

Interjection by an Hon. Member.

HON. MR. NIMSICK: We might lose it. Sure, we're willing to lose it that way but at least we've got an equity. We've got an equity. If Cominco never made a dollar on the copper smelter we'd have an equity in that smelter — something to show on behalf of the people. But you wanted to give it to them altogether as a straight gift. Cominco doesn't need it and neither do any of these big companies.

HON. MR. BARRETT: The giveaway gang.

Interjections by some Hon. Members.

HON. MR. NIMSICK: Clinton up there? You had a hearing up there at Kamloops about the smelter near Clinton. And the only way they could have a smelter there was by a tall stack. They were going to put up a tall stack so that the pollution could come down closer to Vancouver, which might have been a good idea.

We say the tall-stack business is out. It's been out for a long time as far as building smelters goes, not only in this country but in the United States and Japan too.

HON. MR. NIMSICK: It's declined 10,000 barrels

[ Page 2434 ]

since 1971. We had 72,000 barrels without too much pollution. At the smelter at Kimberley they use the ingredients of pollution — the S0₂ —  in the fertilizer plant.

I feel quite certain that Cominco is going to build a smelter at Kimberley. They don't need the $2.5 million from the government or from the taxpayers of this province. As for the Copper Bounty Act, I never thought we'd get as much discussion out of an Act that was dead. It's never done anything; it's never created anything. It was dead when I camy on the job.

Mr. Speaker, I move second reading of this bill.

Motion approved; second reading of the bill.

Bill No. 20 referred to a committee of the whole House at the next sitting after today.

HON. MR. BARRETT: Second reading of Bill 31, Mr. Speaker.

AN ACT TO AMEND
THE PETROLEUM AND NATURAL GAS ACT

MR. SPEAKER: The Hon. Minister of Mines and Petroleum Resources.

HON. MR. NIMSICK: Mr. Speaker, I don't think that this bill will create very much discussion.

In moving second reading of this bill, An Act to Amend the Petroleum and Natural Gas Act, this Act deals specifically with oil. At the present time, we get a royalty on oil of from 5 to 16 2/3 per cent on a graduated scale. At our present rate of production in British Columbia, we now have six years of crude oil supply left.

Interjection by an Hon. Member.

HON. MR. NIMSICK: No. Twelve years when the production falls down. It will be created over a period, but if we produce the way we have…

Interjection by an Hon. Member.

HON. MR. NIMSICK: It's declined 10,000 barrels since 1971. We had 72,00 barrels in January of 1970 and we had 62,000 in January of 1973. 1970 was a peak year.

There's more interest in finding natural gas in s British Columbia than there is in finding oil. In November of 1972, the primary objective in 80 per cent of the Crown land disposition was natural gas. In January, 1973, 93 per cent; in April, 85 per cent were looking for gas rather than oil. Last month 32 wells were being drilled — 30 of them were for natural gas.

It's been declining over the years. We haven't had any new oil wells here for a long time.

Interjection by an Hon. Member.

HON. MR. NIMSICK: Well, last November there was no increase set up for the oil and it was 80 per cent then. What are you trying to feed me in that respect?

The new tax that this bill brings in will be graduated from 10 per cent to 40 per cent. We're not as bad as that Tory Alberta. They graduated it to any height. They've got no limit on the top end of it. Don't forget that it's the regulations that determine how this graduation is worked. Alberta has no ceiling.

In addition to this, we say that we must get more out of oil and we'll also give an incentive. The incentive is that for any new wildcat well on a pool, they'll get three years royalty-free for that well. Any new wells will be graduated for the three-year period. Sure, you go for that right away and I think you should.

Mr. Speaker, this bill is going to bring in greater returns to the people of British Columbia for the fast depletion of our oil resources. Maybe it will also help to find new wells.

I move second reading.

[Mr. Dent in the chair]

DEPUTY SPEAKER: I recognize the Hon. Member for North Peace River.

MR. SMITH: Well, Mr. Minister, we've waited quite a while to tangle on this bill. So just sit back because we're going to have a little discussion this evening.

DEPUTY SPEAKER: I would ask the Hon. Member to address the Chair, please.

MR. SMITH: Yes, Mr. Speaker, I intend to address the Chair. I intend to bring before the House this evening what I think the stupid economics of people who know nothing about oil and the petroleum business in the Province of British Columbia are doing to that industry in this province. There's no question in my mind but that this Government is scuttling the oil business in the Province of British Columbia. I intend to bring before you this evening, Mr. Speaker, some of the facts that will indicate just what is going on in the petroleum industry in the Province of British Columbia, and how the greed for a few extra dollars of revenue in royalties will result in such an increase in revenue to the Treasury from sales of mineral and petroleum resource rights in the Province of British Columbia, that the Treasury will end up

[ Page 2435 ]

with a net loss each and every year from now on.

The Minister has talked about the decline in the production of crude oil in the Province of British Columbia. It's true. It's down a little bit. Why is it down? Because the number of fields in relation to the number of gas fields that we have in British Columbia is very small. The fields that we know of in this province have been drilled out extensively.

British Columbia and the oil industry brought into being a water-injection process which enabled them to recover 30 to 50 per cent more oil from the wells than they would have been able to recover under any other method. They spent millions of dollars perfecting that process. It has cost this provincial government not one thin dime for this province. But they've found a way of recovering far more oil than by any other means. They simply inject water back down into the formation and force the oil back out to the surface again.

Mr. Speaker, there's no way that petroleum companies interested in exploration in the Province of British Columbia are going to spend millions and millions of dollars on exploration for oil when they know that the rate of royalty is double what it is in any other jurisdiction in Canada. This is the faulty economics of a government that doesn't really know what this industry is all about.

What is going to happen is that you're going to scuttle the oil industry in northern British Columbia. You're going to drive out of the field those people who have been there for 20 years. They haven't asked this province for anything. They've invested hundreds of millions of dollars. At the present time over $1.25 billion has been invested in exploration in the Province of British Columbia. What have they asked you for? Nothing. Nothing except for the right to go in and drill.

If anybody in this province thinks that British Columbia is the hot spot in exploration for natural gas or oil, they've got rocks in their head. There are many places in British Columbia where the…

AN HON. MEMBER: Gloom and doom.

MR. SMITH: "Gloom and doom," the man says over there. You know, my friend, why don't you go back to the potato patch? (Laughter). Why don't you go back to the potato patch or the insurance industry? You were never very much good in that, either. But you know absolutely nothing about this business, so sit down and listen for a while. Because you're going to hear something about the petroleum industry tonight and I'm here to tell you that.

Interjection by an Hon. Member.

MR. SMITH: They've invested this kind of money in the exploration in a province that is third-rate in respect to the resource that we have to offer. We have the highest costs of drilling of anywhere in Canada with the exception of the high arctic in British Columbia.

MR. PHILLIPS: They don't know that, they don't even realize what it costs.

MR. SMITH: They don't have a clue about it.

It costs more money to drill in British Columbia in the area where we've been successful in finding some natural gas and oil, than in any other province in Canada, and the only place that it costs more money right now to drill is in the high Arctic.

Interjection by some Hon. Members.

HON. MR. COCKE: Come on, get serious over there.

MR. SMITH: I'm serious, my friend. Now, I'll tell you this…

MR. PHILLIPS: The only gas you know is the kind you put people to sleep with.

MR. SMITH: …that I spent my whole business life in an area where we know something about exploration for gas and petroleum products.

Interjection by an Hon. Member.

MR. SMITH: I don't discredit you, Mr. Minister, for what you know about the business of health and health insurance and hospitalization, and I'm not suggesting that you know all that much about it, but I give you credit for what you do know. Now sit there and listen for a while because, Mister, I'm going to tell you a few things about the petroleum industry tonight.

DEPUTY SPEAKER: Order, please. Would the Hon. Member…

MR. SMITH: If the Hon. Minister would stop interrupting me I'd get back to what I want to really…

DEPUTY SPEAKER: I would ask the Hon. Members on both sides of the House to please observe standing order No. 17, part 2 and not interrupt the Member while he is speaking, please.

MR. SMITH: Thank you, Mr. Speaker. I'm sure you'll protect my rights and I appreciate the fact that you're there in the chair to do just that this evening.

But I want to tell you something about the petroleum industry this evening. While we sit in this

[ Page 2436 ]

House and we talk about a lot of things, and we talk about a number of problems in many areas, there are only two of us who are intimately associated with an area which has been involved in the petroleum industry business.

Interjection by an Hon. Member.

MR. SMITH: For what reason? Because it seemed to be politically expedient to do it; the backbench gets a little uptight back there, Mr. Speaker. They haven't too much to do, and they haven't very much to say. So they seem to feel that when somebody gets up to speak about a serious subject the best attack is ridicule.

But we do have an industry in the Province of British Columbia which has contributed annually millions of dollars to the economy of this province.

Interjections by some Hon. Members.

MR. SMITH: There happen to be two Members in this House whose ridings are intimately associated with the petroleum and the natural gas exploration industry. They happen to be myself and the Member for South Peace River (Mr. Phillips). We know what it's meant to our part of the country. It is a punitive increase, Mr. Speaker, with no rhyme or reason for the increase that we have before us this evening. Somebody pulled a figure out of the air and said "that sounds good…"

MR. PHILLIPS: Out of the clouds. Out of the clouds.

MR. SMITH: "…that sounds good. I think we should increase the royalty on petroleum exploration and production. How far should we go? Well, let's double it at least." And somebody probably said "Oh, that's not enough. Let's triple it.

Interjections by some Hon. Members.

MR. CHABOT: Sock it to them. Sock it to them!

MR. SMITH: Somebody else in cabinet probably said "Oh, no. That's a little too much. We'll ease off a little bit." So they come up with an increase from a minimum of 10 per cent now to a maximum of 40 per cent, where before we had a minimum of 5 to a maximum of 16.5 per cent. It's double, or almost double, the royalty levied in the Province of Alberta, or the Province of Saskatchewan, or the Province of Manitoba.

For what reason? Because it seemed to be politically expedient to do it; not because the province needed the revenue; not because anyone sat down with the petroleum industry and discussed the matter in detail.

With no thought of what they were going to do to the exploration business in the Province of British Columbia they pull a figure out of the sky and say, "It sounds like a good figure and I think the public will generally be acceptable, because they'll know we're gouging the petroleum industry for more money and they can relate that to increased benefits to the people of the Province of British Columbia. So why should anybody buck it? Why shouldn't everybody be in favour?"

Well, I'll tell you why, Mr. Speaker. The petroleum industry was prepared to accept a reasonable increase in royalty. They've said that to me and I'm sure they've said that to the Minister and the Members of the cabinet.

AN HON. MEMBER: Who said that; Rockefeller?

MR. SMITH: Another smart remark from someone who knows nothing about the petroleum industry.

HON. MR. COCKE: You haven't told us anything, yet.

MR. SMITH: You're going to find out something about the petroleum industry.

Interjections by Hon. Members.

MR. SPEAKER: Order.

MR. SMITH: A reasonable increase would have been acceptable. But the average increase is better than double the present rate of royalty on petroleum products in the Province of British Columbia. The average rate of increase will be 200 per cent more than it was in the previous years. Now a reasonable increase, yes, but a punitive increase of that proportion, Mr. Minister, is not acceptable to the petroleum industry.

I agree that you can push it through, and the petroleum industry is not going to say a great deal. But I'll tell you what is going to happen. They're going to slowly fold up their tents and their drilling operations in the Province of British Columbia and disappear from north-eastern B.C. They'll go into other areas where the potential is far greater and the amount of revenue that they have to pay to the Crown is proportionate and equitable and in relation to the risks that they take in investing the money that is required to finance that kind of business.

We are not talking about nickels and dimes, Mr. Speaker. We're talking about hundreds of millions of dollars for exploration activity. Not every drilling process by any stretch of the imagination is a

[ Page 2437 ]

successful one. They invest their money; they drill a well which will cost on the average of $100,000; they employ hundreds of people in that process, and they get as many dry holes as they get successful ones.

The production rate in British Columbia, or the rate of dry holes as compared to good wells, whether it be gas or oil, is increasing because of the simple fact, Mr. Speaker, that many of the known fields in both gas and oil have been drilled out.

Now somewhere in British Columbia there may be another Leduc. But I'll tell you this, Mr. Speaker: it will never be found under the punitive royalty rates that are presently contemplated by this Government.

Right now we can provide less than 40 per cent of the crude oil that we require in the Province of British Columbia. The rest of it has to be imported mainly from Alberta, and that rate is going to escalate rather than de-escalate over a period of the next five years because the demand for petroleum products is going up.

Unless there's an incentive for the exploration industry to continue in the Province of British Columbia, there are many, many other areas in Canada that have far greater potential. The thing that makes me so concerned is this, Mr. Speaker: at a time when everyone in the western hemisphere is talking about an energy shortage, we in British Columbia, because of economics that no one understands, have placed ourselves in a position that within a short time — and it won't happen overnight, not within the next 30 days or the next 60 days, but within the next two years — the petroleum industry will gradually phase out their operations and their exploration programmes.

The Premier is sitting there and he's getting a great chuckle out of this. He really doesn't understand what this business is all about. I suppose that the Premier is going to say sometime soon that if the large major companies are not prepared to explore in the Province of British Columbia for natural gas and oil resources, we'll set up our own company to do it. Well, it's an interesting proposition. Lord help the taxpayers in this province when that happens.

With the fumbling and burnbling that this Government is capable of in that particular field, I can see a half a billion dollars going down the drain without finding one discovery well. Then they say, "Well, too bad, we spent a few of your bucks. We had hoped to get a great return because we were going to take everything back into our coffers. But we were unsuccessful."

The exploration business is an exacting science. It's not one that can be entered into lightly. The Government can take over Columbia Cellulose. They can enter into the lumber business and the pulp and paper business. I tell you, they can't lose half as much money in that business, regardless of how badly they run it, as they'll lose in the exploration for petroleum products in the Province of British Columbia.

Interjection by an Hon. Member.

MR. SMITH: The Premier says the bill is about royalties, Mr. Speaker. I'll tell you this: without exploration and without production, there will be nothing but decreased royalties to the provincial Treasury in the Province of British Columbia.

That's why I'm standing in my place this evening and trying to get through to the members of the cabinet the message that this is a very specialized business. Any company which decides to explore for oil in the Province of British Columbia — and they might hit gas rather than oil; hopefully today they will — will find the type of money they require to be unavailable if there is no foreseeable pay-out on that expenditure. With the impact of increased salaries, increased exploration expenses and now increased royalties, there is a very serious doubt in the minds of all the financial institutions in Canada, who heretofore have backed up the petroleum industry, as to whether they will ever be able to recover the initial investment in the Province of British Columbia, Somewhere down the line that investment must be returned. If there's no return on it, the petroleum industry have no choice. Their source of exploration dollars dries up. The exploration business grinds to a halt in the Province of British Columbia. All of us in this province are sorrier for that happening.

They go to the Mackenzie Delta area. They go to Alberta, which is just adjacent to ourselves. They even go to Saskatchewan because they get a better deal there, and they get a better deal in Manitoba than in this province. But they pull out of an area and no one knows this better than Saskatchewan. So the people who represent the government of this province…

Interjection by an Hon. Member.

MR. SMITH: Oh, my friend, my friend.

The petroleum industry made a start in Saskatchewan. For 20 years they pulled out of that province and wouldn't go near it.

HON. W.L. HARTLEY (Minister of Public Works): Rubbish!

MR. SMITH: The Minister of Public Works says, "Rubbish." Let me tell you this, Mr. Speaker. The only garbage that I've heard tonight is from that Minister.

For 20 years the petroleum industry concentrated in the Lloydminster area, just across the border in the Province of Alberta, and never drilled one single, solitary well in the Province of Saskatchewan.

[ Page 2438 ]

AN HON. MEMBER: They'd find it dry there.

MR. SMITH: They wouldn't cross that border for love or money because of the imposts that had been placed upon them by an NDP government in that province.

HON. MR. BARRETT: CCF.

MR. SMITH: CCF at that time. I stand corrected.

HON. MR. HARTLEY: No giveaways.

MR. SMITH: No giveaways in Alberta.

AN HON. MEMBER: No jobs either.

MR. SMITH: No jobs. Let me tell you this, Mr. Minister. The number one source of revenue to the Province of Alberta for the last 20 years has been the revenue received from the petroleum and natural gas exploration industry in that province.

HON. MR. BARRETT: Why do they have deficits in their budgets now?

MR. SMITH: "Why do they have deficits?" the man says.

Interjection by an Hon. Member.

MR. SMITH: They didn't give it away. I'll tell you one thing, Mr. Speaker. They're not the only province that will have a deficit if we go on financing these types of ventures in the Province of British Columbia that we've entered into in the last two weeks, courtesy of the Government.

MR. PHILLIPS: Will you resign your portfolio?

MR. SMITH: Will you resign your portfolio if and when the oil industry starts pulling out of the Province of British Columbia? Will you resign as the Minister of Finance if the exploration in the Province of British Columbia is reduced next fall, as compared to this year?

[Mr. Speaker in the chair.]

MR. SPEAKER: Let's get back to the question, please, rather than hypothetical matters.

MR. SMITH: Thank you, Mr. Speaker. I appreciate your remarks. I'll try to get back to the subject.

The subject is the matter of an increase in royalty in the Province of British Columbia — an increase which, in my estimation, is punitive. It's higher than in any other province of Canada. It seems to be the practice of this Government to buy up defunct corporations such as the one at Ocean Falls. They do it on the basis of saving jobs for those people who are employed at that complex.

This bill, Mr. Speaker, scuttles an equal number of jobs in the petroleum industry in north-eastern British Columbia. So what have we gained in the broad spectrum of employment in the Province of British Columbia?

Interjection by an Hon. Member.

MR. SMITH: That's not an hypothetical proposition, Mr. Minister. That's an actual fact. You're going to save 10 or 100 jobs here and you're going to displace 100 people over there. Or 200 or 300.

Interjection by an Hon. Member.

MR. SMITH: No, I'm telling you a few of the facts. The thing that is so unacceptable is that we are, apparently, in an energy crisis, so some people would like to say, in Canada and in the whole western hemisphere. Yet at this time the people who…

Interjection by an Hon. Member.

MR. SMITH: I've got lots of information here that I haven't even started on yet. You're going to hear about it.

The people who should be interested in exploration in British Columbia will not be sold.

AN HON. MEMBER: They don't want to hear it.

MR. SMITH: Do you wish an adjournment to the next sitting of the House, Mr. Speaker?

MR. PHILLIPS: Oh, legislation by exhaustion.

Mr. Smith moves adjournment of debate.

Motion approved.

Hon. Mr. Barrett moves adjournment of the House.

Motion approved.

The House adjourned at 10:55 p.m.