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CONTENTS

Routine proceedings

Budget address. Hon. Mr. Barrett — 127

Special Funds Appropriation Act, 1974 (Bill 7).

Hon. Mr. Barrett. Introduction and first reading — 141

Municipalities Aid Amendment Act, 1974 (Bill 9).

Hon. Mr. Barrett. Introduction and first reading — 141

Burrard Inlet (Third Crossing) Fund Amendment Act, 1974 (Bill 10).

Hon. Mr. Barrett. Introduction and first reading — 141

Income Tax Amendment Act, 1974 (Bill 11).

Hon. Mr. Barrett. Introduction and first reading — 141

Succession Duty Amendment Act, 1974 (Bill 12).

Hon. Mr. Barrett. Introduction and first reading — 141

Probate Fees Amendment Act, 1974 (Bill 13).

Hon. Mr. Barrett. Introduction and first reading — 141

Social Services Tax Amendment Act, 1974 (Bill 14).

Hon. Mr. Barrett Introduction and first reading — 141

Elderly Citizen Renters Grant Amendment Act, 1974 (Bill 8),

Hon. Mr. Nicolson. Introduction and first reading — 142

British Columbia Auditor-General (Bill 19).

Mr. Gardom. Introduction and first reading — 142

The House met at 3 p.m.

Prayers.

MR. D.A. ANDERSON (Victoria): Mr. Speaker, it gives me a great deal of pleasure to introduce a guest to the House today. He comes from a great tradition of public service. His father, indeed, sat in this House and made a great name for himself as a battler against corruption in high places. He comes with impressive credentials of his own, Mr. Speaker. He's a graduate of UBC, a graduate with distinction from the Masters of Business Administration course at Harvard, and he comes with a distinction of having won out over three other very fine candidates by a landslide victory in the North Shore. I give you, Mr. Speaker, our new colleague to the House, Gordon Gibson.

HON. D. BARRETT (Premier): Mr. Speaker, I too would like to add my words of welcome to the new MLA. I don't know whether or not I should admit this, but I knew his father well. I'm not concerned so much about the relationship, which was one that I enjoyed very, very much when I was a new MLA, but what I'm concerned about is that it is beginning to date me by age. Nonetheless, I welcome the new Member, and I hope that if there are any inherited traits he brings with him his father's sense of humour.

I'd also at this time, Mr. Speaker, like to welcome to the floor of the House Dianne Baigent, who was our unsuccessful candidate in that very by-election.

Also, Mr. Speaker, we have with us the dean of our caucus, a man who spent many years with us and who is back today for a visit — Arthur Turner.

Mr. Speaker, by consent among the leaders of all parties, it was agreed to dispense with the oral question period today. I would ask leave of the House to implement this agreement.

Leave granted.

Orders of the day.

HON. D. BARRETT (Premier): Mr. Speaker, I'd like to move that the public accounts for the fiscal year 1972-73 be referred to the Select Standing Committee on Public Accounts and Economic Affairs.

Motion approved.

Presenting reports.

Hon. Mr. Barrett presents the Report of the Comptroller-General, pursuant to provisions of the Audit Act.

ESTIMATES OF SUMS REQUIRED

FOR THE SERVICE OF THE PROVINCE

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Estimates of Sums Required for the Service of the Province for the fiscal year ending March 31, 1975.

Hon. Mr. Barrett moves that the said message and the estimates accompanying the same be referred to a Committee of Supply.

Motion approved.

BUDGET ADDRESS

HON. MR. BARRETT: Mr. Speaker, our government came to office in the fall of 1972 with a mandate to increase the public financial return on the resources of this province. Such a mandate requires careful planning, and it is the nature of long-range changes to show their benefits gradually.

Accordingly, Mr. Speaker, our government decided to meet its most pressing commitments first, those of improving the financial position of the elderly citizen and of giving immediate catch-up relief to school districts and hospitals that had been held back by the previous administration. But today I have the pleasure to report that our policies coincided with great prosperity to British Columbia during the past year.

Combined with sound management of our resources, this prosperity has put us in a stronger position to undertake the programmes of public spending that will give British Columbians a chance to benefit directly from the policies that they endorsed in the last election.

The voters of this province called for a programme designed to eliminate school taxes from residential property. Our budget today will provide a substantial move in this direction. The citizens of British Columbia asked for a broader public direction in housing. Our budget today will fund several programmes of land assembly, servicing, house construction and mortgage financing that will make this democratic right accessible to all citizens.

Municipalities, which lack the taxing flexibility of senior governments yet face increasing costs every year, will find in this budget several substantial programmes designed to assist them. Our government will initiate a programme today that will provide a first measure of financial relief to renters under the age of 65 years.

Our capital spending will be generous in a variety of areas. Funding will be made for the imaginative programmes of farm income assistance and free drugs for the elderly.

These and other benefits amount to a public

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resource dividend, Mr. Speaker, and that is why I am pleased to present this resource dividend budget on behalf of the citizens of British Columbia.

When our young government took office 17 months ago, some irresponsible politicians suggested we would be unwise in our spending, that the province's international credit rating would weaken, and that the previous government's accumulated cash surplus would disappear. None of these things has happened. British Columbia continues to enjoy the highest ratings possible outside the United States by both Moody's Investors Service Incorporated and Standard and Poor's Corporation of New York.

Our cash surplus has actually increased, and is substantially up from $98,557,814 on March 31, 1972, to $144,354,385 at March 31, 1973. The huge inherited parity bond demand debt has been reduced by $74 million, Mr. Speaker, to a manageable $179 million, so that it will not interfere with government fiscal management.

Mr. Speaker, despite major innovative social policies, our government has been prudent. This prudence is also reflected in the good news that none of the spending programmes to be proposed in today's budget will require an increase in tax rates for the individual citizens of this province.

That's good news indeed, and our government is able to give this message to our citizens because of their confidence in the economy of our province, because they worked hard to make this province what it is today. It is time to bring the dividends back to the ordinary citizens of British Columbia — the loggers, the fishermen and the farmers, the wage and salary earners in all walks of life, the men and women and children whose lives and dreams are invested in the home we call British Columbia.

While at this point we do not have the audited accounts for the province representing a full year of management by the government, I am able to offer a measure of the general performance of provincial finances and the economy over the past 17 months. I have tabled today the Comptroller-General's detailed report on the province's revenues and expenditures for the first nine months of the fiscal year. Hon. Members will be impressed by the 25.6 per cent increase in revenues. Some collapse, Mr. Speaker; some collapse!

The major part of the increase in provincial government revenue arises from the very high level of economic activity prevailing in the province rather than from any significant change in tax rates. And, Mr. Speaker, not a single firm has been nationalized. Rather, we have conducted purchase negotiations in the open market under mutually agreed terms, Mr. Speaker — mutually agreed terms. We have bolstered the smooth operation of a mixed economy by inviting the business community to fully discuss problems with us. However, we have made clear to industry that super profits, special tax concessions granted by former administrations, or blatant exploitation of natural resources will no longer be tolerated. Business also must demonstrate more responsiveness to changing social and environmental values.

Our New Democratic government has not only matched the rate of economic development reached by the former administration, but it has surpassed it. Let me point out some of the remarkable gains realized in 1973 over 1972.

The most comprehensive indicator of overall economic well-being is the change in the Gross Provincial Product. This economic measure rose an astounding 16 per cent in 1973, an annual increase that compares very favourably with the province's previous best years, even after taking the inflation factor into account. Selling value of factory shipments soared upward by 25 per cent under the first year of our administration, Mr. Speaker, and public and private investment increased by 10.4 per cent, compared to only 0.1 per cent in 1972. The number of jobless, instead of skyrocketing, was actually 8.5 per cent below the 71,000 unemployed we inherited from the previous administration, despite a labour force growth of 5.5 per cent. Personal income rose by 15.4 per cent and corporation profits strengthened too, Mr. Speaker. And we're happy about that, as long as they pay their fair share.

Mr. Speaker, I want to turn now to the legislative accomplishments of our government. In three legislative sessions we have introduced and had enacted by this House a significant quantity of social legislation designed to raise the living standards of our citizens. We have been successful in many respects in a very short time. The Mincome programme, which had become effective in December, 1972, today now covers over 121,000 people — who deserve this protection from their fellow citizens. It also includes an estimated 15,000 people who are in the new age category of 60 to 64 years of age, and another 7,000 handicapped. And I'm proud to state the guaranteed income for each person in these categories now stands at $213.85 per month.

The minimum wage level was raised to $2.25 on December 3, 1973, the highest in Canada, and will

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move to $2.50 an hour on June 4, 1974. Contrary to predictions that the new rate would result in high unemployment, a provincial government study revealed that few firms had trouble adjusting, and a federal report shows that the number of unemployed has actually decreased in British Columbia during the past year. Yes, Mr. Speaker, we have provided jobs under this government, and we have reduced unemployment, and we intend to continue those policies.

The recent establishment of the Department of Consumer Services and the Department of Housing will provide many fundamental and long-overdue services to British Columbians. Consumer Services will supply the public with up-to-date consumer information and conduct extensive investigation into buyer complaints, and a continuous programme of revising and expanding existing consumer legislation will be carried out. The Housing Ministry will consolidate, rationalize and accelerate housing programmes throughout the province. Because adequate housing is a basic human right, our government intends to increase building and land development projects as a priority until the needs of our people are met.

It is not necessary to list the large number of other legislative improvements in the fields of health, education and other essential social services, for they are a matter of public record.

Our budget will show clearly that the provincial economy and government finances are in excellent shape. Large gains were experienced throughout the various sectors of the economy, and the Government of British Columbia revenues and expenditures are at record levels. I am certain that continued sound management of the vast resources of the province will enable our government to make the 1970s the most progressive in British Columbia's history.

The past year, Mr. Speaker, was one of expanded consultation and discussion with the Government of Canada for the province, reflecting our government's objective stated in last year's budget address, "to bring a new direction for British Columbia inside the Canadian Confederation."

The Western Economic Opportunity Conference between the Government of Canada and the governments of the four western provinces held in Calgary, Alberta, July 24 to 26, 1973, was the most important federal-provincial conference last year, from our point of view, for it has the potential of producing the greatest long-term advantages to British Columbia. This meeting was unique for two reasons.

First, the federal government had never met with the provinces of a region of Canada in open forum to discuss vital issues which, in our view, hinder western attainment of fulfilment as equal participants in Canadian Confederation.

Secondly, the four western provinces set aside parochial issues to present a common position. The agenda included discussions on transportation, emphasizing anomalies in the Canadian railway freight-rate structure; economic and industrial development, including fostering the growth of secondary industry; agriculture; fisheries; and tariffs.

Mr. Speaker, the submission on "Capital Financing and Regional Financial Institutions" was particularly important to British Columbia. This was one area in which the provinces obtained from the federal government a promise of early action on giving provincial governments the same right as any other Canadian investor in the holding of voting shares of a Canadian chartered bank.

The Prime Minister of Canada, in his closing remarks at the conference, indicated his government's intention to introduce amending legislation to the Bank Act in 1974 to make this possible. He also indicated that that was the last western conference that he'd be having. Nonetheless, it was successful. I think his words were: "Thus ends the first and last conference of the western Premiers."

Interjection.

HON. MR. BARRETT: Well, nonetheless they did make a promise, and I expect to see that Bank amendment Act in the House this spring.

Government equity investment not only offers the potential of increased competition in the banks — in the important and essential banking industry — to the advantage of all citizens and businessmen, but allows the general public to share in the generous profits of the industry. And believe me, Mr. Speaker, bank profits are almost as good as oil company profits these days. Increased competition can only foster increased responsiveness of the financial institutions of Canada to the region they serve.

The federal Minister of Finance (Hon. Mr. Turner) introduced in his 1973 budget, without consultation with the provinces, the concept of annual indexation of the personal income tax. Indexation allows for an annual escalation of personal exemptions and of the tax brackets in the schedule of rates by the annual rate of inflation, with the result taxpayers pay income taxes only on gains in real income.

While we accept the principle of indexing the

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personal income tax, I am concerned over the federal government making a change in a provincial tax base without discussions with the province, for the British Columbia income tax is calculated from the federal base.

As a result of the federal government's action, Mr. Speaker, British Columbia will lose approximately $20 million in income tax revenues in 1974, and this amount will be compounded in future years. Again, Mr. Speaker, I want to emphasize that, while I am not against the tax principle involved, I am concerned that the federal government took such action alone. Regardless of that action, Mr. Speaker, this government does not intend to raise its provincial income tax rate from the lowest level in Canada to recoup this loss. It will remain as the lowest rate in all of Canada along with Ontario's.

The federal government has joined with the province in a major undertaking that will be mutually beneficial to Canada and British Columbia. I am referring to the agreement entered into last year by the respective governments covering the expansion of the Port of Prince Rupert and extensions of the British Columbia and Canadian National Railway systems in the northern part of the province. This co-operative effort will provide the transportation structure essential to the development of this area of the province. However, Mr. Speaker, there is a great deal of negotiation yet to be carried on.

At a First Ministers' meeting in Ottawa last month, the energy problem, which had been brought to a head by the strong position taken by the major oil-exporting countries, was fully discussed. Canada is more fortunate than most industrial nations; we are self-sufficient in all energy supplies and have a substantial reserve for future needs.

As I see it, Mr. Speaker, the two major energy problems for Canada are the short-term one of distribution and the long-term one of future development. The distribution problem should largely be resolved with the extension of the trans-Canada oil pipeline into Quebec and the Maritimes, the planned construction of which was announced by the federal government last month.

Because energy is essential to the industrial state, governments must be involved in its development as a public utility. Virtually all the provinces have taken over responsibility for electric generation for general consumption. The current situation in Canada respecting oil and natural gas, both essential and irreplaceable energy sources, demands active government participation. Gas and oil are a national requirement and the needs of all regions of Canada must be met, ideally from within Canada.

Mr. Speaker, it is our government's intention to continue the development of communications with British Columbia's neighbouring American state. An exchange of views in areas of common concern should foster the spirit of understanding and cannot but help preserve friendly relations. It was our distinct pleasure to have two visits from Washington state representatives during this past year.

The government, Mr. Speaker, is concerned over the increasing costs of municipal government services relative to the ability of the local revenue base to support such expenditures. The property tax, the principal source of revenue for municipalities, has not been as responsive for their requirements as it can be. The annual limitations on increases in assessed values introduced by the previous government to safeguard residences and farms from the tax effect of rapidly escalating residential property values had the same effect on commercial and industrial properties. This government considered this unjust, if for no other reason than the income-tax advantage on property taxes enjoyed by businesses.

Enactment by this Legislature a year ago of amendments to the Assessment Equalization Act re-established the intent of the original Act which was to have the assessment base of commercial and industrial properties and land held for speculation at 50 per cent of the current market value.

However, Mr. Speaker, some small businesses, as well as persons owning small parcels of vacant land for their future homes, have had increases in property assessments higher than we would like. To alleviate this situation the government proposes to introduce a partial property tax deferment of increases above the level of 1973 taxes on most improved properties and small landholdings.

Further, Mr. Speaker, we wish to remove the immediate burden of all property taxes for residents 65 years of age and over and for the disabled, blind and widows through a full deferment of all property taxes on most homes of persons in these categories commencing in 1974.

MR. G.B. GARDOM (Vancouver-Point Grey): Optional?

HON. MR. BARRETT: Optional; purely voluntary.

Mr. Speaker, it is the idea proposed by many legislators in the past, proposed to a government that wasn't willing to listen. Now we've listened and we've brought about this move on behalf of all the people. I welcome the ideas because this is a receptive government.

One further step this government has taken on business assessments effective in 1974 is the ending of special property-tax concessions to a number of industrial firms. Why should the industrial firms receive tax concessions? It was a question we asked the former administration and we've now ended that practice. We see no necessity for an incentive which adversely affects the property-tax liability of other

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property-owners, especially the small people in this province.

I will be proposing legislation today which will initiate our programme to remove school taxes from residences and farms. Thus, the total tax burden upon homeowners will be reduced.

The government, Mr. Speaker, is also acting in other ways to assist the municipalities in meeting their responsibilities. I will shortly reveal our proposal for direct financial assistance to municipalities in the next fiscal year. We have already announced our intention to assume responsibility from the municipalities for the administration of the provincial courts. This will reduce the substantial municipal administration-of-justice costs and free highly-trained personnel for law-enforcement duties.

AN HON. MEMBER: Hear, hear!

HON. MR. BARRETT: Mr. Speaker, in the field of municipal social services, we have recently taken responsibility for the administration of welfare services in the City of Vancouver, following upon similar action in Victoria and Saanich. We also propose to reduce the municipal share of the cost of welfare programmes in the province from 15 per cent to 10 per cent.

There are other areas in which we are extending assistance to the municipalities. Our greatly expanding housing programme has significant import to the municipalities, and I will be commenting later on our proposal for financing transit in the lower mainland.

We would hope the municipalities would respond to our proposals to increase their revenues and to adjust their costs in a positive manner to the benefit of the homeowner. By the provincial government assuming some of the municipal-expenditure responsibility while increasing support to municipal revenue, municipalities have more flexibility to budget without the need for excessive increases in property-tax mill rates.

Mr. Speaker, shortly after the 1972-73 fiscal year end, the Abridged Public Accounts and the British Columbia Financial and Economic Review were released in order to provide an accurate, up-to-date picture of the provincial government and Crown corporation fiscal positions. I have already distributed the detailed public accounts for the year ending March 31, 1973 to the House to be carefully analyzed by the Select Standing Committee on Public Accounts and Economic Affairs. My comments here therefore, will be brief.

There were impressive increases in that fiscal year in the value of provincial government fixed assets, total assets, and excess of assets over liabilities and reserves. Fixed assets as of March 31, 1973 of $1,565 million were approximately $140 million above those of March 31, 1972. While the total assets were up 12.8 per cent, the provincial surplus, or excess of assets over liabilities, grew to a gain of 11. 5 per cent.

Revenue receipts went up from $1,437 million for the fiscal year ending March 31, 1972 to $1,667 million in the past fiscal year, a gain of 16 per cent in one year, or $230 million.

Expenditures from current revenue, including all capital, registered a 14.2 per cent gain over the previous year, as $1,621 million was appropriated in the fiscal year ending March 31, 1973. With the addition of $45 million in revenue surplus for the fiscal year 1972-73, the budgetary cash reserves of the province climbed to $144 million compared to $98 million we had when we came to office, Mr. Speaker.

The direct debt of the province decreased by $999,407. The direct debt. We do have debt. If some Members would like to leave the House at this part of my speech to preserve a sacred memory, they may do so. (Laughter.)

The direct debt of the province decreased by $999,407 in 1972-73 and totalled at fiscal year end $46,753,164, all fully covered by sinking-find investments. The gross contingent liability debt of the province grew by $250 million to reach $3,248 million as of March 31, 1973, offset partially by sinking-fund investments of $298 million.

The spectacular gains attained in 1973 in all sectors of the provincial economy make the year one of the best in the province's history and equal to any of the overall annual growth records realized under any former government. Much of this advancement was a direct result of exceptional business activity in the economy, together with excellent national and international markets for our natural resources, many selling at record prices — and, I might say, Mr. Speaker, record returns from those resources because of this government's policies.

The value of the 1973 export shipments expanded in nearly every market, bringing the total to $4,530 million — over 39 per cent above the previous year. Exports of forest, mineral and fishery products were especially higher.

The 1973 Gross Provincial Product grew by a phenomenal 16 per cent over 1972 to an estimated $13,848 million. Even if the annual 6.3 per cent rise in the Vancouver consumer price index is used as a deflator, there was still a substantial real gain of almost 9 per cent, impressive by any standards.

The value of capital and repair investment rose to $4,114 million from $3,726 million a rise of 10.4 per cent, compared to an increase of just 0.1 per cent in 1972 over 1971, hardly an indication of business uncertainty, Mr. Speaker — but I would say a vote of confidence in a new aggressive government in the Province of British Columbia.

Mr. Speaker, where are the "doom and gloom"

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boys today?

British Columbia's population at October 1, 1973, was estimated to be 2,343,000, an increase of 3.3 per cent from a year earlier and almost two-and-one-half times the rate of increase of the total Canada population. The labour force, representing the persons with employment plus those seeking work, increased by 52,000, or 5.5 per cent, over the one million mark for the first time in the history of this province.

However, the increase in employment was even greater, with a gain of 58,000 more persons working, or up 6.6 per cent — the highest in both absolute and relative terms in the past 10 years. More jobs, Mr. Speaker, more jobs.

The result of this increase in persons employed was a decline in the rate of unemployment from 7.5 per cent of the labour force in 1972 to 6.5 per cent in 1973. Despite the increase in the number of people looking for work, there was a decrease in the number of unemployed in this province.

Income from wages and salaries increased by 23 per cent to $7,350 million. The employment and income advances stimulated consumer spending, and retail sales climbed to $4,780 million, up 16.7 per cent from 1972. Housing construction, particularly single-family dwellings, continued at a high level, reaching 36,000 housing starts, surpassing the record 1972 total.

There was a 25.4 per cent increase in the selling value of factory shipments to $5,920 million in 1973. While all sectors of our economy registered gains, almost two-thirds of this advance was in the forest industry, Mr. Speaker. Unfortunately, the lack of rail cars to transport wood products forced a slowdown in shipments from the Interior. Our government has taken steps to meet this problem through establishment of our own rail-car manufacturing plant at Squamish.

Mr. Speaker, a truly impressive 55 per cent annual growth in the value of mineral production was registered last year as the value reached $993 million, up from $637 million in 1972. It was just one year ago that some unnamed Members of this House were predicting that the whole mining industry in this province would collapse, Mr. Speaker.

AN HON. MEMBER: That's throwing sand in the gears.

HON. MR. BARRETT: It's not throwing sand in the gears. I feel a sense of embarrassment for that unnamed Member, Mr. Speaker. And I'm pleased that the advances that I am reading today actually took place with no filibuster.

Substantially higher prices for a number of key minerals and the first full year of operation of several large properties accounted for much of the gain. The volume of copper production increased by 50 per cent, and the value soared to $500 million, a gain of almost $300 million in one year. The agriculture and fishing industries also experienced favourable advances — do we still have an agricultural industry left after the Bill 42 debate?

Strong provincial economic growth is expected to continue in 1974 in almost all sectors. The demand for newsprint, pulp, lumber, coal, natural gas, copper, and fishery products is particularly buoyant. Of potential concern is the extent to which the prevailing petroleum-related energy crisis affects the economies of those advanced industrial nations that buy the major portion of our exports. There is little evidence to this date of any reduced demand for our products and we may be safeguarded by their relative basic importance to our customers. There is even the potential for us with a surplus of certain types of energy to further process our resources for our customers and increase our manufactured product capability.

Mr. Speaker, at this point I'd like to mention that we are concerned about a constant supply of steel. And this government has not lost sight of its goal to have a steel mill in the Province of British Columbia.

Some say that it is not feasible in this province. Some say that it was not possible to even consider. Mr. Speaker, I hope that they, like all other predictions of those soothsayers of doom and gloom, will be proven wrong, and proven wrong much sooner than I thought it would be possible.

The British Columbia....

MR. H.W. SCHROEDER (Chilliwack): English money?

HON. MR. BARRETT: Well, Mr. Speaker, if it's English money, or British Columbia money — somebody's money....

AN HON. MEMBER: Was it Kaiser money?

HON. MR. BARRETT: The Kaiser money? We don't want to talk about that. We will anticipate what we will anticipate.

The British Columbia business community is demonstrating optimism for 1974. The capital investment intentions outlook indicates an even higher rate of growth than in 1973. However, with many businesses at or near the limit of productive capacity it is too much to expect a rate of growth in the Gross Provincial Product at the level of the 1973 experience. An annual growth rate of 10 per cent to 12 per cent appears attainable, with price changes a significant element of the overall growth. World economic consequences from the curtailment and pricing of oil shipments by the major oil-exporting countries are indeterminable at the present and will

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bear watching in view of the importance of the industrialized countries to the British Columbia economy. The year 1974 is also a major year in labour negotiations and we encourage tolerance and understanding by both sides in all negotiations so as not to be seriously disruptive of the economy.

Provincial corporations now include the British Columbia Hydro and Power Authority, the British Columbia Railway Company, British Columbia School Districts Capital Financing Authority, the British Columbia Regional Hospital Districts Financing Authority, the British Columbia Harbours Board, the British Columbia Cellulose Company, the Ocean Falls Corporation, the Insurance Corporation of British Columbia, the British Columbia Petroleum Corporation and the British Columbia Development Corporation.

Mr. Speaker, it is the opposition's record that they voted against the British Columbia Petroleum Corporation. Yet it was that little corporation, run by a faithful servant, James Rhodes, which enabled this province to reap a benefit of returns up from 15 per cent under Social Credit administration to over 40 per cent returns on our natural gas, all in one year.

Natural gas sold out of this province at 31 cents per thousand cubic feet under the former administration. We've doubled the price to 61 cents. All we're seeking, Mr. Speaker, is to go to the Louisiana purchase price, and that is $1.10 per thousand cubic feet. We will never, never, never allow those natural resources to be given away, Mr. Speaker, as they were by the former government. No business sense, Mr. Speaker....

Interjection.

HON. MR. BARRETT: Oh, Mr. Speaker, there's a voice from the past — a voice laden with guilt, anxiety and wonder. Mr. Speaker, I can sense the heartfelt, downtrodden twangs of patience, conscience, whatever it is. That Member said that this government couldn't run a peanut stand. Well, you were in business when you were selling peanuts, through you, Mr. Speaker — we're selling natural gas. Why, Mr. Speaker, not one of our cabinet Ministers now needs a guard to walk with him on any street. (Laughter.)

The province continues to meet the provincial Crown corporations' capital requirements from its own internal investment fund, thus keeping away from costly borrowings in the public market. In 1973, $152 million from the Canada Pension Fund and $181 million in provincial trusteed funds were made available at market prices.

The province has also made repayable advances at prime bank rates to the provincial Crown corporations in the current fiscal year. Mr. Speaker, the corporations that we inherited from the former administration haven't got the same repayment record on a percentage basis as we have. The advances to the Insurance Corporation of British Columbia, the British Columbia Cellulose Corporation and the British Columbia Petroleum Corporation are now repaid.

The Insurance Corporation of British Columbia began providing general insurance in British Columbia, on a competitive basis, on October 1, 1973, under the authority of the Insurance Corporation of British Columbia Act, passed April 19, 1973. It is expected that $12 million in general insurance premiums will be written in the calendar year 1974.

I understand, Mr. Speaker, that the school boards of the Province of British Columbia will be relieved of the cost of insurance premiums. The Minister of Education (Hon. Mrs. Dailly) has guaranteed that that burden will be removed from their budgets, helping them as well, Mr. Speaker. In addition, Mr. Speaker, the corporation's administration of the Automobile Insurance Act is expected to generate premium income in excess of $200 million in the first vehicle-licence year of Autoplan.

The British Columbia Petroleum Corporation, established through legislation enacted at the 1973 fall session, has the authority to buy, sell, and explore for natural gas and petroleum, and to purchase and operate pipelines and other related facilities in the province. The corporation now purchases all natural gas produced in British Columbia, sells it to marketing agencies in the province, and exports the excess. My friend the Attorney-General (Hon. Mr. Macdonald) called it 30-second socialism. That's exactly what it is, Mr. Speaker, and it's also good business. This function has enabled the province to receive a higher price for its resources, along with an increased return to the producers, which will allow increased exploration.

Hon. Members have already noted, I am sure, the appointment of the board of directors of the British Columbia Development Corporation, announced last month. The purpose of this corporation is to promote income, employment and general economic expansion by way of financial and technical assistance to industries. The province is to provide the initial share capitalization of $25 million.

The Comptroller-General's interim financial report for the period April 1, 1973, to December 31, 1973, will be tabled today, and reveals the staggering growth in provincial revenue and expenditure over the same nine-month interval of the previous fiscal year. It is important to note that the huge gains in revenue did not result in any major tax changes, other than the corporation income tax, but they are directly linked to the province's heightened prosperity plus a greater return from the natural resources of this province.

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During the nine months to December 31, 1973, revenue accruals reached $1,488 million, up $303 million from the same period in 1972 — a rise of 25.6 per cent. Major revenue gains were in: timber sales — $108 million. In income taxes — $84 million. In social services tax — $39 million. In Canada share of joint service programme — $22 million. In liquor profits — $13 million. In motor-fuel taxes, $10 million.

Mr. Speaker, expenditure accruals were $1,333 million — up $202 million or 17.9 per cent. Principal lifts in this period were: Human Resources, $56 million; education, $44 million; and hospital and medical care, $34 million.

Fiscal measures for the expenditure of the resultant fiscal year surplus will be detailed later in this speech.

Mr. Speaker, the government, in preparing its first budget last year, was under the constriction of time. As you know, we took office on September 15, 1972, and almost directly had to decide upon expenditure plans for the current fiscal year. We responded to the most obvious deficiencies in provincial government services to people and, even at that, added $342 million in a single year to the level of expenditures, with particular emphasis on education, our senior citizens and health care.

The programme of expenditures for the 1974-75 fiscal year, which the government is submitting today for the consideration of this Legislature, reflects more fully the results of our critical assessment of the government's programmes in relation to the needs of our people and the ability of the economy to support a level of provincial government services deserving of all sectors of the community. The British Columbia economy today is strong and productive. There are more people working at higher wages, producing more products in more plants operating at or near full capacity, than ever before.

We have no hesitation, therefore, in proposing this record budget. It is presented without any increase in tax rates for our citizens, without the need to borrow for either operating or capital expenditures, and without planning to draw from the cash surplus balance of $144 million.

Mr. Speaker, we will have a total expenditure in this year of $2,172,796,526. It is the first budget over the $2 billion mark, Mr. Speaker, in the history of this province.

MR. J.R. CHABOT (Columbia River): Doubled in five years.

HON. MR. BARRETT: Doubled in five years? I thought it was supposed to be ruined in one by this government. (Laughter.)

Mr. Speaker, it is an increase in one year of $453,887,000. Our budget, the first to exceed $2 billion, includes by far the largest single-year increase in expenditure proposals. I think the single-year increase in budget is higher than when these two Members first came in the House, Mr. Speaker.

HON. R.M. STRACHAN (Minister of Transport and Communications): Higher than the total budget.

HON. MR. BARRETT: Higher than the total budget — one year's increase under this government. There is a lift of $453 million over the current year's budget for all current and capital expenditures — a total of $2,172 million — wholly financed from next year's ordinary revenue. In addition, an appropriation of $140 million from cash surplus is proposed for a variety of special purpose programmes. These budgets and special appropriations totalling $2,312,797,000 for 1974-75 exceed the budget and special appropriations of our first budget by $508 million — 28 per cent in one year — under this young, new government.

The Department of Education once again is to receive the largest appropriation, which is $553,688,000 — up $67 million over the current year. Grants to school districts are increased by $29.5 million, with the government picking up a further $15 million of the school-tax burden, through the school-tax removal programme.

This morning I was asked at a press conference about the classroom shortage that we inherited from the former administration. I want to announce, as I did at that press conference, that we will make available to any school board emergency additional capital funds if they wish to come to the Minister of Education and make the case for those capital funds for classroom make-up.

Further, Mr. Speaker, along with this amount of money, we will make available special supplementary warrants for any school district that shows us an exorbitantly high student-teacher ratio. The Minister herself will initiate that action upon completion of a survey, and she has the authority from myself and the Treasury Board to come for special warrants throughout this year if circumstances call for this emergency help. Case-by-case, situation-by-situation study will be given by the Minister. She has been given the authority by the Treasury Board for those special supplementary warrants. Mr. Speaker, we want these school boards to become involved directly with the Minister. If they can make the case, the money will be made available. We hope these measures will lead to reduced class sizes, Mr. Speaker.

Grants to community colleges are up $13 million to a total of $41 million, an approximate 35 per cent increase in one year for the community colleges. Technical and vocational schools are provided an additional $6,500,000 over the current year allotment of $19,500,000.

Grants to the universities are increased $10 million to $121 million. And, Mr. Speaker, I said at the press

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conference that the universities, if they wish to pioneer new programmes, if they wish to pioneer new services, if they wish to experiment with the quarter system, if they wish to use their professional schools on evenings, weekends and fully during the summer months, we will fund them for those new developments. Mr. Speaker, if the universities wish to go out to the communities and take their professional skills and professional help in a new form of education at the community level, we will help them through financing. If the universities come to us with programmes that allow the industrial workers or the working women of the Province of British Columbia to take courses on regularly scheduled hours to meet night-shift, graveyard-shift or day-shift requirements of full-time employment, we will finance those programmes as well.

Mr. Speaker, we do not like the fact that in the United States of America 27 per cent of all high school graduates go on to college education while the figure is only 12.5 per cent here in the Province of British Columbia. The Ford Foundation did research indicating that if universities went onto a quarter system with an 11 per cent increase in staff, they could have a 25 per cent increase in capacity.

Mr. Speaker, if the universities come to us with these programmes, the money will be there to implement them on behalf of those people who desperately need higher education out there in that community. And, Mr. Speaker, these people want this education.

We have no intention of telling the universities what to do; but if the universities come to us with these bold, imaginative and thoughtful programmes, they will not be turned down by the Treasury Board. Our people deserve, and should be obtaining, and should have every opportunity of obtaining the best kind of education they want to fill their needs.

Another major commitment of our government this next year is in the Department of Health. Programmes for hospital care through the Hospital Insurance Service will cost $85 million more than the amount budgeted in the current year, or a total of $359 million. Mr. Speaker, I wish to emphasize this is a fantastic one-year increase in hospital insurance costs for the provincial government.

Another important hospital care expenditure this coming year is for the British Columbia Medical Centre located in Vancouver. The medical coverage provided under the overall medical services plan will cost $15 million more, or a total of $105 million.

Continuing the government's programme to extend mental health care at the community level, $9,488,000 is provided. The total increase in 1974-75 expenditures of this department is $112 million to a level of $548 million.

The Department of Human Resources programmes are to receive a further $55 million next year. The new Pharmacare programme for free prescription drugs for all residents age 65 and over, which was implemented January 1, 1974, will cost an estimated $10,500,000 this year. Medical services and drugs for persons not qualifying under the Pharmacare plan will cost $9,301,000.

Our Mincome programme which today guarantees all residents 60 years of age and over, and blind and handicapped persons regardless of age, a monthly income of $213 per month has been an unqualified success. Accordingly, $12 million more is to be voted to discharge our commitment to this government programme. We have also included funds for the provincial administration of welfare services in the City of Vancouver.

Mr. Speaker, the allocation of $75,593,000 to the new Department of Housing is $62 million more than is provided in the current year's budget. It indicates, Mr. Speaker, the importance our government attaches to ensuring adequate housing for every citizen regardless of his circumstances. Another resource dividend is in the creation of a new renters' grant programme to provide an annual grant of $30 per year to resident renters up to age 65, plus an increase in the existing annual renters' grant to residents aged 65 and over by a like amount to a total of $80. Further housing funds will be made available through a surplus appropriation.

Mr. Speaker, I sat in this House year after year hearing the plea from Social Credit Members, NDP Members, Liberal Members — there were no Conservatives at that time (at least they didn't reveal themselves) — all asking for renters' grant programmes to be initiated in the province to allow the people who rent to have a resource dividend in this province as well. Today is the first step: $30. I want to tell you this, Mr. Speaker: there will be more in each succeeding year for those renters.

Construction and maintenance of the provincial highway network will be augmented through a $32 million increase in the appropriation to the Department of Highways.

The Department of Public Works expenditure is increased by $9 million, including $4.5 million more for the construction of public buildings.

Expenditures in the Department of Lands, Forests and Water Resources are increased by $28 million to $95 million, or by 42 per cent. In the Lands Branch the total appropriation has been increased $3,353,000, of which the pre-servicing of Crown lands for sale or lease expenditure has been increased fourfold to $2 million. The Environment and Land Use Committee Secretariat is supplied with $2,227,000, of which $1,100,000 represents a transfer of function from the Department of Agriculture.

The reforestation vote was increased by $7,809,000 to $12,900,000, a 55 per cent increase in

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one year in that reforestation vote. And I might say that the Minister of Lands and Forests (Hon. Mr. Williams) who now holds that portfolio pointed out time and time the need for reforestation and now has been successful at Treasury Board, increasing that by 55 per cent. I wish you had stopped there.

Considerably more miles of forest development roads will be constructed this coming year, for which the expenditure allotment is increased from $2,438,000 to $4,043,000. The overall Forest Service expenditure is up $17 million.

Of the $7,460,000 increase in the Water Resources Services expenditure, $6,600,000 is allocated to the federal-provincial-municipal grant shared-cost programmes on Fraser River flood control. A total of $12,600,000 will be spent on bank protection, dikes and drainage works. The present sharing on the drainage and diking project is: provincial government, 45 per cent; federal government, 45 per cent; and local area, 10 per cent. We propose to pick up one-half of the local share, thereby increasing the province's share to 50 per cent and inviting the federal government to take similar action to reduce the local share to nil.

Mr. Member (Mr. Rolston), just for a brief moment I wish you were here and I was there as the Member for Dewdney, hearing about this good news today after all those years.

AN HON. MEMBER: Fourteen years.

HON. MR. BARRETT: Fourteen years, right.

In the Department of the Attorney-General, a total of $70 million is provided, $25 million more than in the current year.

That's the end of all those old diking speeches. (Laughter.) Somebody behind me just said it was worth it. I'm beginning to wonder.

The assumption by the province of responsibility for the administration of justice from the municipalities and expansion of the court system will increase our costs by $15 million. There will be a cost-saving to the municipalities although not an equivalent amount. Equally important will be the freeing of a number of municipal police officers from court duties for law enforcement. Legal aid services are being expanded at an additional cost of $1 million.

The Department of Recreation and Conservation is budgeted for $25 million, an increase of $11 million in a single year. Expenditure on parks alone is increased by $7,289,000; on the maintenance of our fish and wildlife, $2,958,000; and on the Youth Training Programme, which provides summer employment for a number of our young people, $350,000.

The Department of the Provincial Secretary, which includes the Public Service and Superannuation Commissions, receives $9,015,000 more than in the current year.

A major programme for the Department of Communications and Transport in this next year is the expansion of the British Columbia Ferries' fleet to meet the traffic demand. Because of an excessively large expenditure involved, I deem it inappropriate to have this as a charge to next year's revenue. We will have to build two new ferries and a truck ferry. Therefore, I propose to establish a ship construction fund from the anticipated surplus for the fiscal year 1973-74. I will comment on this later in my speech. Ordinary expenditures of this department are increased by $8,606,000.

Increase in apprenticeship training programmes....

Interjections.

HON. MR. BARRETT: Well, Mr. Member, before I read the speech today I allowed myself a little reflection on what I would do if I were in the opposition and I had to criticize this budget the next day. I decided the best I could provide would be plaintive quips and hope that tomorrow would pass very, very quickly. (Laughter.) Maybe, Mr. Speaker, they refused to speak in the wrong debate. (Laughter)

Mr. Speaker, increases in apprenticeship training programmes and provision for the new Labour Relations Board account for the major portion of the $5,735,000 addition to the expenditure of the Department of Labour.

The Department of Agriculture expenditure programmes require $15 million next year, including $2,500,000 for low-interest loans under the Agricultural Land Development Act.

To assist municipalities to meet their budget requirements and to reduce the incidence of their increased costs upon municipal property-owners, the government is recommending an increase in the annual per capita grant from $32 to $34 per person effective in 1974. Along with the saving on courts, Mr. Speaker, along with the savings of the social services tax, Mr. Speaker, the municipalities will be saving a great deal of money. Together with other municipal entitlements for additions to population this will take $7,700,000 of the annual increase in the Department of Municipal Affairs. Total expenditures of the department will be $81 million.

Mr. Speaker, I would also like to comment upon the $27 million Burrard Inlet (Third Crossing) Fund established by the previous administration. As the name implies, the purpose of this fund was to provide another access facility between the City of Vancouver and the North Shore. However, it is obvious from the vehicle traffic situation in downtown Vancouver that another connection contributing to an increased vehicle flow is not the answer to Vancouver's traffic

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problem. In our view, Mr. Speaker, the appropriate, long-term solution lies in the development of an efficient rapid transit system. Therefore, Mr. Speaker, we will be redescribing that $27 million fund for a rapid transit system to serve the lower mainland area.

Hon. Members are aware of the government's undertaking with the Pacific North Coast Native Co-operative to develop an integrated fishing operation at Port Simpson near Prince Rupert through a $3 million low-interest loan for the acquisition of a core fishing fleet and a $3 million grant for the construction of a cannery. Grant payments totalling $1,500,000 have been approved in the current fiscal year and $1,300,000 is provided in the estimates of the Department of Industrial Development, Trade and Commerce.

The new Department of Consumer Services is established in the estimates with a budget of $1,169,000 allocation.

A $10 million provision for a pay increase for the province's public servants is included in the appropriation for the Department of Finance.

Our proposals for the legislative appropriation of $140 million of the current year's anticipated cash surplus are as follows. Because of the cost of construction of the new ferries and its excessiveness, in that it would be too high to put to a regular budget item, we have recommended that $35 million be set aside out of this year's surplus to build those two passenger ferries and one truck ferry. Those ferries, we hope, will be built in British Columbia; we expect they will be built in British Columbia.

MR. H.A. CURTIS (Saanich and the Islands): You said they would be built in B.C.

HON. MR. BARRETT: We will promise that they are built; but we are asking that the owners of the shipyards keep a very sharp pencil, a very sharp pencil.

AN HON. MEMBER: Double-hulled?

HON. MR. BARRETT: Double-hulled? Well, Mr. Member they will be double-hulled and they will be sufficient for keel-hauling as well. (Laughter.)

Interjection.

HON. MR. BARRETT: Well, Mr. Member, the money is there; the difficulty will be in receiving some of the steel. We hope that that problem will be resolved. The Minister is dealing with some steel suppliers at this particular time. The appropriation will provide for next year's expenditure on the construction of two 367-car vessels, one truck-trailer vessel and the necessary terminal modifications to accommodate these fleet additions.

Our government's commitment to fulfilling a promise to remove school taxes from the property-owned, owner-occupied residences and family farms is being initiated through a $15 million surplus appropriation. Briefly, the school-tax removal legislation will be introduced to provide a minimum payment of $30 and up to $40 to all owners in 1974.

Augmenting the $75 million to be voted for housing in the ordinary budget is a $40 million surplus appropriation for first and second mortgages pursuant to the Provincial Home Acquisition Act. I shall fully review elsewhere in this speech this government's policy on housing which involves an overall expenditure of in excess of $115 million next year in the housing field. This is further evidence of our government keeping its promises with bold action supported by the necessary money.

The $10 million Community Recreational Facilities Fund, established in our first-year budget a year ago, received an enthusiastic response from the communities throughout the province, a response that exceeded the limits of the fund to the extent that a further $5,500,000 has been appropriated in the current fiscal year. Fifteen million in community recreation. Mr. Speaker, this programme was so successful that some sports broadcasters didn't even know it existed. (Laughter.) It happened right past them, but now I think they are aware of what the fund is. Because of its success, Mr. Speaker, and in recognition of the multifaceted benefits from the facilities provided under this programme, a further $10 million is to be made available for the ensuing year.

All parties, Mr. Speaker, endorsed this programme. I must tell you how much the communities enjoy the benefits of this programme. Just late last year I was in Fort St. John where over 1,000 people came out for the opening of the kids arena, as they called it. It was a dream of that community for many, many years, and I was pleased to be there at that opening along with the Member (Mr. Smith) who represents that particular community in this province. That Member, Mr. Speaker, still represents that community, although some negative people said a year ago that that community would be a ghost town because of our policy.

I'm glad that that Member is still here and the town is still here and it's flourishing as never before. I forget who it was who said it was going to be ghost town; but let his memory be a ghost, Mr. Speaker (Laughter) — the spirit of Christmas.

There are no ghosts skating on the rink.

The government's sharing arrangement is one-third of the cost of the first $1 million in any one project.

At the 1973 fall session legislation was passed establishing the British Columbia Medical Centre, and we are now following up with a commitment of $10 million from this year's surplus to start that

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development.

The farm income assurance and agricultural products secondary industry development programmes, introduced by this government and enacted by this House at our last session, were important components in the wide range of legislation designed to safeguard and strengthen our agricultural capacity. To carry out the terms of this legislation the Farm Income Assurance Fund and Farm Products Industry Development Fund are to be established in the amount of $10 million each.

The perpetual funds, British Columbia Cultural Fund and Physical Fitness and Amateur Sports Fund, each capitalized with $15 million at present, afford an assured source of income each year for the government's support of these activities. We wish to increase this assistance and, therefore, propose to add $5 million to each one of the funds with the investments to be made in long-term securities of our schools and hospitals capital-financing authorities.

In summary, $140 million of the current year's anticipated surplus is to be allocated as follows:

$35 million for the construction of ferries;

$15 million for the removal of school taxes;

$40 million for first and second mortgages for homes;

$10 million for community recreational facilities;

$10 million for the British Columbia Medical Centre;

$10 million for a guaranteed income for farmers;

$10 million for the development of agricultural products secondary industry;

$5 million for the British Columbia Cultural Fund;

$5 million for the Physical Fitness and Amateur Sports Fund.

Mr. Speaker, I have felt it necessary to take so much time to review our budgetary proposals, although it is only possible at this stage to touch on the highlights. But these highlights are a measure of our assessment of the deficiencies in government services left behind by the previous administration.

The tremendous one-year lift in departmental current expenditures must be considered as a catch-up budget in areas which this government considers inadequately serviced. Including our first budget last year, almost $950 million will have been added to the provincial economy in two years. While we have the fiscal resources to meet these commitments, I must make clear to the Hon. Members that this volume of expenditure increases cannot be anticipated into the future.

One thing I want to mention here is the government's purchase of 1,157, 125 or 13.5 per cent, of the shares of Westcoast Transmission Company. In my recent announcement of this purchase I said: "This is a reversal of economic trends. Unlike the old practice of United States companies using Canadian funds — profits from Canadian resources — to buy Canadian companies, we are using United States funds — profits from the sale of our resources — to buy back a resource company."

At a previous session, Mr. Speaker, the Minister of Finance was given the power under the Revenue Act to purchase shares in any company. This is the first time this power has been exercised, and then only under the very special circumstances of this particular case. But, Mr. Speaker, as long as we are government, we are committed to the philosophy that the people of this province want to be masters in their own house and have the capacity and the desire and the energy to carry out that particular philosophy.

Mr. Speaker, for over 100 years this province allowed itself to be buffeted by external economic forces, based on the myth that private capital from beyond would always be the benefactor of this province. The treasure house of this province was assaulted time and time again from the turn of the century, through McBride's administration, on up to the '20s and the '30s — yes, the '50s highlighted by such things as the Wenner-Gren proposal and the amount of money we had to pay back on that.

This is the first government in the history of this beautiful province that is committed to the concept that the resources that belong to the people of this province must benefit the people of this province to the maximum degree; and our purchase of Westcoast Transmission is purely a repatriation of our own destiny, Mr. Speaker.

We don't expect the other parties, Mr. Speaker, to applaud this point because this is the crux of the difference between us and any other party that ever sat in government in this House. They were always the same, regardless of name, always willing to bend, to mould and to shape their policies to any entrepreneur who arrived on a fast-buck promotion. We've said: "The end of this forever." I tell you, Mr. Speaker, that no matter what happens in the future history of this province, this trend will never be reversed, because any government that attempts to do it will be defeated forthwith by the people of this province.

As I stated previously, Mr. Speaker, we are undertaking this massive expenditure programme of over half-a-billion more dollars in one year without any increase in tax rates for our citizens — rates which, incidentally, are among the lowest in Canada without any borrowing for either operating or capital accounts, and without touching the $144 million revenue surplus in the bank as of March 31, 1973.

Estimates of our revenues based on the anticipated performance of the British Columbia economy over the next 12 months indicate an adequacy to cover total government proposed expenditures, both current and capital. In fact, Mr. Speaker, not only do we expect to achieve this but we also plan to reduce the province's revenue yield from the social services

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tax and succession duties. We will be exempting all books and second-hand clothing from the 5 per cent sales tax, Mr. Speaker. Under proposed changes to the Succession Duty Act, great-grandchildren will benefit to a greater extent than heretofore through inclusion in the most-preferred category of beneficiary. Also, the exempt limit for the administration of estates is to be increased from $2,000 gross value to $5,000.

There is a printed error in the budget speech, and I would like to call this to the attention of the Members. In terms of the Succession Duty Act....

Interjection.

HON. MR. BARRETT: Well, it's on 17 in the budget speech: "The exempt limit for the administration of estates is to be increased from $2,000 gross value to $5,000." The leaders of all opposition parties were provided with a copy of the budget yesterday at 1:30 — and the press, by embargo.

AN HON. MEMBER: Who else?

HON. MR. BARRETT: Who else? The press, by embargo, that's all. It's a change from former policy. We used to receive the budget, when I was Leader of the Opposition, the day it was presented — the hour that it was presented.

Interjections.

HON. MR. BARRETT: Friday. Well, I tell you this: the hon. gentlemen who are the leaders of the opposition parties did not leak the budget.

Interjections.

HON. MR. BARRETT: Well, I don't think they did. I trust the press. I have confidence in the press. I don't say that necessarily for their owners. (Laughter.)

The estimate of revenues for the 1974-75 fiscal year of $2,177 million is $455 million or 26.5 per cent more than the budget estimate for the current year. This is achieved with tax rates which, as I say, are among the lowest in Canada.

In view of the forecast for sustained high provincial energy requirements, it is important that the British Columbia Hydro and Power Authority have long-term plans for development of our electrical energy resources. I propose to seek the approval of this House of a $500 million increase in the authority's borrowing authorization to finance construction projects and transmission lines.

Impressive is the only way to describe the new, comprehensive housing programme planned for in British Columbia. The rapid rate of change and the large scope of operations in this area outlined in this budget indicate the government's serious purpose of providing good housing for all British Columbians.

In the fall session of 1973 the Legislature approved an Act to establish a Housing department. Under this Act, the Minister of Housing has the authority to create projects anywhere in the province. Several previous Acts dealing with housing and related areas were transferred to the new Ministry and a housing fund was set up on December 1, 1973, to provide financing of planned facilities.

Our government's determination to formulate long-run housing programmes which best meet the needs of citizens is revealed in the huge increase in funds to help low- and moderate-income people rent or purchase decent homes. The addition of $40 million to the Provincial Home Acquisition Fund for first-mortgage and house-conversion loans, together with other home-acquisition grants and second-mortgage programmes which will be financed from the fund, will help thousands of people acquire homes of their own. This will also create thousands of jobs in British Columbia.

Expanded housing programmes for our senior citizens will be carried out, for $10 million is provided this coming year to help non-profit community groups build over 1,600 units next year under the Elderly Citizens' Housing Aid Act. This is about double the current year's allotment for senior citizens.

Additionally, the new Department of Housing will have $50 million for programmes of land assembly and servicing, neighbourhood improvement, co-operative housing and family rental housing. Under this programme the province has the flexibility to build houses on government land and either sell them using the first-mortgage programme or rent the properties.

Mr. Speaker, these three items alone will provide $100 million in one year for provincial housing encouragement and development.

In 1973, as a result of new provincial government housing activity, British Columbia exceeded its Central Mortgage and Housing Corporation allocation for the first time. And it should have done that many years ago. But 1973 was the first year. In the next fiscal year the provincial government will, in one way or another, be involved in financing over two-thirds of all housing starts in British Columbia.

I was incorrect this morning, Mr. Speaker, when I said at the press conference that we would be involved in one-third; we will be involved in two-thirds.

The British Columbia pavilion at the international Expo '74 in Spokane, Washington, to be held from May 14 to November 3, will feature the importance of mankind living in harmony with the natural environment — one of the foremost problems facing

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the world today.

At the provincial level the Government of British Columbia has rejected the dollar-value-alone approach to progress. Only those types of growth not detrimental to the environment or the well-being of our populace will be undertaken. We will not duplicate the mistake of our predecessors who failed to initiate proper studies to determine the ecological impact of major projects, thus ignoring possible negative aspects of development in their eagerness to promote growth.

Enjoyment of increasing leisure hours must not be restricted or reduced as a result of a deteriorating environment. Through the action of this government to enlarge the pollution control staff, water, air, noise and effluent pollution problems are being examined thoroughly and control standards are being raised and enforced.

Evidence of the damaging effect that pollution has upon the environment and the repercussions it has for humans and the economy should make it obvious for all of us. Fortunately, little actual environmental damage has occurred, but we cannot be complacent. The provincial government realizes it is responsible for establishing high pollution standards throughout the province, but the co-operation of other levels of government, business and private citizens, is essential to achieve a meaningful ecological goal. Government legislation, financial incentives and recycling plans, no matter how comprehensive, are only truly effective when there is solid public support.

Mr. Speaker, I would now like to review briefly the perspective of the 1974-75 fiscal year budget as it relates to the principal functions of provincial expenditure.

As I stated in our first budget a year ago, this government's first priority is to provide the best social services possible for the people of the province within our fiscal capabilities. With the substantial amount of social legislation enacted in the 17 months since we formed the government, plus that planned for this session, we will have made considerable progress toward that goal. Social improvement measures of the provincial government will command a record $1,507 million of this budget, a significant $801 million increase over the $705 million spent in 1970.

To ensure a properly planned education system that is responsive to the needs of our society, several groups of professional and lay people are closely examining the entire educational structure. However, there are obvious areas which demand immediate attention and the government is committing $567 million next year to upgrade and expand existing programmes at all levels of the education system. This is 76 per cent more than was spent by the provincial government on education five years ago.

The recently completed comprehensive study of the British Columbia health care programmes has been received by the government and released immediately to the public. It is my government's desire for a full and open consideration and discussion of the study and its recommendations throughout the provincial community. Responses from the public will be helpful to the government in developing for British Columbia the most progressive and enlightened health care in Canada and perhaps in the world. In the interim we have proposed a total expenditure of $939 million for health and social services next year, almost two-and-one-half times the amount spent in 1970.

The expanded and extended hospital-care programmes of this government require $367 million in the 1974-75 fiscal year. Through construction of hospital facilities appropriate for the several levels of care, the government expects to achieve a more efficient use of the hospital-care dollars. The progressive human resources programmes of this government demand $303 million next year, $190 million more than five years ago. The expanded programmes for housing will take $76 million. The British Columbia Medical Plan's need for $105 million under the budget reflects, in part, expansion in benefits not shareable by the Government of Canada.

Mr. Speaker, let me mention here that we will still resist the new federal financing formula for shared programmes, despite the trust fund, if in any way that new federal formula threatens the level of health care to other less fortunate areas in this great country.

If we are truly to stay a nation, if we are truly to reach our own destiny as Canada, then we must not go for short-term cash benefits — even for our province — at the expense of long-run damage to the basic social services and health-care programmes in this country.

Mental health care throughout the province will cost an estimated $59 million and public health services, $27 million.

The varied provincial government activities in the field of transportation and resource management require an expenditure of $423 million.

Mr. Speaker, our budget takes major steps to better the lives of our citizens through a variety of income-support programmes, job-creating policies, housing developments, as well as direct cash payments and tax benefit plans to assist both individuals and families.

Our budget is fiscally responsible. Despite record-breaking expenditures, our programmes and proposals are fully within the ordinary financial resources of this province. We have directed many millions of dollars in surplus funds into a wide range of areas because we believe that surpluses are a financial resource that should be returned to the

[ Page 141 ]

taxpayer as a public dividend. As I have said before, we do not believe in building surpluses just for the sake of doing so.

Our role is that of both steward and servant to the public. This is a great responsibility, and we intend to husband the great resources of this province for the greatest public benefit.

We were elected on a platform that included a call for a fairer return on our resources, and we meant it. Our steps to double public revenues from our petroleum and natural gas are now a matter of record, and we are continuing to work for an end to the give-away policies we inherited from the past. We will continue to fight to protect the public's right to a strong and growing share of the wealth that belongs to all our citizens.

In a real sense, Mr. Speaker, we are just beginning, and I say to the citizens of this province in a spirit of brotherhood and sisterhood, let us continue to work together to these ends.

Mr. Speaker, it's a great budget. But I'm not so proud of it for myself as an individual; I'm proud of it because it embodies, in terms of the many people who work with our party — and many people outside of our party, and the ordinary people of this province — a step toward the dream of really being masters in our own house and sharing far more equally in the beautiful revenues and the resources and the lifestyle of this wonderful province.

Having said this, Mr. Speaker, I now move with pleasure the traditional motion of our parliamentary system of government: "that Mr. Speaker do now leave the chair for the House to go into Committee of Supply."

Mr. Bennett moves adjournment of the debate.

Motion approved.

SPECIAL FUNDS

APPROPRIATION ACT, 1974

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Special Funds Appropriation Act, 1974.

Bill 7 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.

MUNICIPALITIES AID

AMENDMENT ACT, 1974

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Municipalities Aid Amendment Act, 1974.

Bill 9 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.

BURRARD INLET (THIRD CROSSING) FUND

AMENDMENT ACT, 1974

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Burrard Inlet (Third Crossing) Fund Amendment A ct, 1974.

Bill 10 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.

INCOME TAX AMENDMENT ACT, 1974

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Income Tax Amendment Act, 1974.

Bill 11 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.

SUCCESSION DUTY AMENDMENT ACT, 1974

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Succession Duty Amendment Act, 1974.

Bill 12 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.

PROBATE FEES AMENDMENT ACT, 1974

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Probate Fees Amendment Act, 1974.

Bill 13 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.

SOCIAL SERVICES TAX

AMENDMENT ACT, 1974

Hon. Mr. Barrett presents a message from His Honour the Lieutenant-Governor: a bill intituled Social Services Tax Amendment Act, 1974.

Bill 14 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.

ELDERLY CITIZEN RENTERS GRANT

AMENDMENT ACT, 1974

[ Page 142 ]

Hon. Mr. Nicolson presents a message from His Honour the Lieutenant-Governor: a bill intituled Elderly Citizen Renters Grant Amendment Act, 1974.

Bill 8 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.

BRITISH COLUMBIA AUDITOR-GENERAL

On a motion by Mr. Gardom, Bill 19, British Columbia Auditor-General, 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.

MR. GARDOM: After all that money, Mr. Speaker, we want somebody who's going to watch the till. That's what we're after. (Laughter.)

HON. MR. BARRETT: Mr. Speaker, would the House accept a short recess?

The House took recess at 4.50 p.m.

The House resumed at 4.55 p.m.

Presenting reports.

Hon. Mr. Hartley tables the report for the year 1973 of the Department of Public Works.

HON. J. RADFORD (Minister of Recreation and Conservation): Mr. Speaker, I would ask leave of the House to present corrections to a statement I made in the last sitting of the House on February 5 (page 117).

Leave granted.

HON. MR. RADFORD: Mr. Speaker, I made a statement that in the last three sessions the government had passed 191 bills, and only 34 were voted against. I went on to say that the Socreds voted against six, when it should have been 29; the Liberals voted against eight, when it should have been 22; and the Tories voted against seven, when the figure should have been eight. I wouldn't want to deter the opposition any further by those mistakes, Mr. Speaker.

Hon. Mr. Cocke files the Hospital Act regulations pursuant to statute.

Hon. Mr. Barrett moves adjournment of the House.

Motion approved.

The House adjourned at 5 p.m.

ERRATUM

Page 102, column 2, line 23 et seq. should read:

The people are concerned that there will be a political education system in British Columbia. I say to you, Madam Minister, as kindly as I can...