[ Page 2925 ]

CONTENTS

Routine proceedings

Trade Practices Act (Bill 126). Hon. Ms. Young.

Introduction and first reading — 2925

Oral questions.

Rezoning attempt on Kelowna property for ICBC purposes.

Mr. Bennett — 2925

Modifications and work on ferries and facilities.

Mr. Curtis — 2926

White lines on highways.

Hon. Mr. Lea — 2927

Statements by Highways Minister and tourist industry policy.

Mr. D.A. Anderson — 2927

Loopholes in rent stabilization Act.

Ms. Brown — 2927

Release of Riverview order-in-council patients.

Mr. Gardom — 2927

Supply of steel to BCR boxcar plant.

Mr. Chabot — 2928

Contingency plans for Vancouver police strike.

Mr. Gibson — 2928

Play drugs in Victoria.

Mr. McClelland — 2928

Committee of Supply: Department of Lands, Forests and Water

Resources estimates.

Amendment to vote 137.

Mr. Phillips — 2928

Hon. R.A. Williams — 2940

Mr. McGeer — 2944

Mr. Cummings — 2946

Mr. Wallace — 2946

Mr. Lockstead — 2947

Mr. Schroeder — 2948

Hon. Mr. Cocke — 2952

Mr. McClelland — 2953

Mr. Lewis — 2956

Mr. Fraser — 2957

WEDNESDAY, MAY 8, 1974

The House met at 2 p.m.

Prayers.

HON. D.G. COCKE (Minister of Health): Mr. Speaker, two days ago this might have had more significance. In any event, no matter what happens from 3 o'clock our time this afternoon and 6 o'clock Ottawa time, I'd like to table, so that all the Members of the House can have a copy of it, "A New Perspective on Health of Canadians" — it's a working paper — produced by the Department of Health in Ottawa. There will be a copy available for all Members of the House.

Leave granted.

MR. P.C. ROLSTON (Dewdney): Mr. Speaker, I'd like to introduce to the House the Reverend and Mrs. Cliff Henning from the Methodist Church in South Africa, and also their friends, Mr. and Mrs. Gordon Tomlin, from West Vancouver.

HON. W.L. HARTLEY (Minister of Public Works): Mr. Speaker, I would like to introduce a group of students from Merritt in the Nicola Valley. They brought a special gift to the Legislature today and I imagine that that was the reason the lights were turned out; when the electricians heard that a group of sunny, bright students from Merritt were coming, they felt we needed no extra light. But they did bring a beautiful day here, a whole day full of Nicola Valley sunshine. For that I would like to thank Mrs. Newhouse and Mr. McBain and I hope you will all welcome them to the Legislature.

HON. E. HALL (Provincial Secretary): Mr. Speaker, I want to tell the House that today is a happy day for the Chabot family. The Member for Columbia River has survived 47 stormy years in a couple of provinces and it's his birthday today. I think we should all wish him a happy birthday, in the full knowledge that he'll be on his best behaviour all day. (Laughter.)

MR. H.A. CURTIS (Saanich and the Islands): Mr. Speaker, I'd like to introduce to the House a tireless worker on behalf of the Saanich and the Islands Progressive Conservative Association, Malcolm Mitchell, who has brought along his two young sons to observe the political process today. I hope that they enjoy it.

Introduction of bills.

TRADE PRACTICES ACT

Hon. Ms. Young presents a message from His Honour the Lieutenant-Governor: a bill intituled Trade Practices Act.

Bill 126 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.

Oral questions.

REZONING ATTEMPT ON KELOWNA
PROPERTY FOR ICBC PURPOSES

MR. W.R. BENNETT (Leader of the Opposition): Mr. Speaker, to the Minister of Transport and Communications. In a news article in The Province about the City of Kelowna it says that a Kelowna alderman has accused Transport and Communications Minister Bob Strachan of trying to blackmail the city into rezoning property owned by the Insurance Corporation of British Columbia.

Further, it goes on that the mayor...

MR. SPEAKER: Order, please.

MR. BENNETT: I was just going to ask him to comment on it.

MR. SPEAKER: Under Beauchesne's authority here it says that an oral question must not inquire whether statements made in the newspapers are true.

MR. BENNETT: Well, then, I'd like to ask the Minister if he could comment on the five-acre site in the City of Kelowna and whether the, Minister has made an offer that the City of Kelowna couldn't refuse in an attempt to get the ICBC land rezoned.

MR. SPEAKER: May I also remind the Hon. Leader of the Opposition that Beauchesne says that a question must not contain or imply charges of a personal character?

MR. BENNETT: May I ask the Minister, Mr. Speaker, what procedure ICBC has.... What procedures has he taken on behalf of ICBC to obtain zoning for a five-acre site in the City of Kelowna?

MR. SPEAKER: Now that's a good question.

MR. BENNETT: I thought you'd like that.

HON. R.M. STRACHAN (Minister of Transport and Communications): I want to thank the Member for asking me that question, too.

Mr. Speaker, on the last day of April we had a

[ Page 2926 ]

directors' meeting of ICBC. I was informed that we were being refused permission to use five acres of a nine-acre site for ICBC purposes in the City of Kelowna. The suggestion was that we acquire property elsewhere.

By a fortuitous circumstance, that very evening right here in Victoria I met Alderman Stewart and I asked him about that and he said, "The corporation has never applied for permission to use it." He said: "Why don't you ask us, send a telegram? There's a meeting Thursday night and I don't expect there will be any problem."

So the next day, May 1, I sent the following telegram to His Worship Mayor W.C. Bennett, City of Kelowna, 1435 Water Street, Kelowna, B.C. And I said:

URGENTLY REQUEST YOU GRANT THE ICBC PERMISSION TO USE FIVE ACRES OF THE CORPORATION'S PROPERTY AT RR 2 SPRINGFIELD FOR THE OPERATION OF AN AUTOMOBILE SALVAGE DEPOT. TOTAL-LOSS VEHICLES WILL BE ACCUMULATED IN THE DEPOT. HOWEVER SALE OF THESE VEHICLES WILL BE CONDUCTED TWICE WEEKLY. SALVAGE WILL BE STORED IN AN ORDERLY MANNER AND IT IS NOT EXPECTED THAT THERE WILL BE A BUILD-UP OF WRECKED VEHICLES. IT WOULD BE THE CORPORATION'S INTENTION TO FENCE AND LANDSCAPE THE PROPERTY IN SUCH A MANNER SO THAT IT WOULD BE ATTRACTIVE AND MEET MUNICIPAL REQUIREMENTS.

R.M. STRACHAN, MINISTER OF TRANSPORT AND COMMUNICATIONS.

I had received no reply by last Friday, I think it was, and I phoned the mayor to find out what had happened at the Thursday meeting and he said, as I recollect it, that it would take a little longer. But he gave no indication that there would be any problem attached to it.

MR. BENNETT: A supplemental, Mr. Speaker. Is it not true that when ICBC entered into an agreement with the city on the property last year it was specifically stipulated that no wrecked vehicles would be kept on the site?

HON. MR. STRACHAN: Oh, yes; that's why I said the alderman said that no application had ever been made, and that's why I sent the telegram.

MR. BENNETT: The supplemental is that on your behalf ICBC entered into an agreement that no vehicles.... Then I would ask the Minister this: what has happened to the negotiating team which negotiated that no vehicles would be on this site?

HON. MR. STRACHAN: I think there's a question on the order paper about that. That company is no longer employed by ICBC.

MR. BENNETT: A supplementary.

Interjection.

MR. SPEAKER: Let's try one more anyway. I think the Hon. Member for Vancouver–Point Grey has another on the same subject. Would you proceed with one more supplementary?

MR. BENNETT: Would the Minister tell me if ICBC — or he on behalf of ICBC — discussed with the Land Commission on zoning in the different cities for ICBC?

HON. MR. STRACHAN: To the best of my recollection, I have never spoken to the Land Commission about zoning for ICBC. Someone from ICBC may have, I don't know, but they usually make a point of working with the municipalities.

MR. P.L. McGEER: (Vancouver–Point Grey): In that telephone conversation, did the Minister refer to other land that the area of Kelowna wished to have rezoned by the provincial government for the purposes of a fire station?

HON. MR. STRACHAN: I have no recollection of having discussed that matter in that telephone conversation with the mayor of Kelowna, at any time.

MODIFICATIONS AND WORK ON
FERRIES AND FACILITIES

MR. CURTIS: To the Minister of Transport and Communication on another matter, following up on his statement yesterday with respect to a new vessel which has been purchased for the British Columbia ferry fleet. I wonder if the Minister could tell the House if a ship-building or ship-repair yard has been selected to do the modification work which was indicated in the Minister's statement. Has time, in fact, been booked? I ask the question in view of several statements which have been made with respect to the heavy workload in shipyards at the present time.

HON. MR. STRACHAN: I'd have to check that. I have no information that any space has been booked for the limited amount of work that has to be done.

But related to that statement I made yesterday, the Member for Oak Bay (Mr. Wallace) asked me when we had first got into this discussion, and I said the first report I had was, I think, April 16. In my office there was a previous document, a first report,

[ Page 2927 ]

that two ships were available and just giving a rough outline of them. That was dated March 27, so I want to correct that.

MR. CURTIS: Could the Minister inform the House as to the now likely completion date of expanded facilities and slips at Tsawwassen terminal?

HON. MR. STRACHAN: No, I haven't got that figure with me; I'll check on it. That's the work they're doing now.

MR. CURTIS: As soon as possible, I hope.

WHITE LINES ON HIGHWAYS

HON. G.R. LEA (Minister of Highways): Mr. Speaker, I believe it was yesterday or the day before when the Hon. Member for Cariboo (Mr. Fraser) asked about white lines on highways. I think it is a concern to most rural Members about the situation in regard to white lines. I checked into it. We had four machines to put white lines on when we took over the government. We now have five and there's another one ordered.

The reason we're having a bit of a problem is that this government has ordered that more sanding and more de-icing be done in the winter months. Because that is being done and the roads are better maintained, the white lines are becoming obscured by the sand and the material used to de-ice. So we're going to have to possibly live with one situation or the other.

We'll try and look after the white lines as much as possible, but more than that we want to make sure the roads are safe during the winter months.

STATEMENTS BY HIGHWAYS MINISTER
AND TOURIST INDUSTRY POLICY

MR. D.A. ANDERSON (Victoria): I have a question which is vaguely related to the people who follow white lines, namely the tourists. May I ask the Provincial Secretary, who is responsible in this area, whether the statement of the Minister of Highways that jobs in the tourist industry are primarily "menial and degrading" is a statement of government policy?

Further, is it his intention, as proposed by the Minister of Highways, to replace tourist industry jobs with other jobs in secondary industry?

HON. MR. HALL: I don't think the description of tourist industry jobs as described by my colleague is a completely accurate one. I don't think that's government policy and I have no intention of changing or recommending to cabinet any changes in the policy as currently operating for the Travel Industry department this year.

MR. D.A. ANDERSON: A supplementary to the Minister of Industrial Development. May I ask him whether he and his colleague, the Minister of Highways, were in discussion with a view to having funds which might otherwise be available through his department for the travel and tourist industries being sent to other areas of the economy rather than this sector?

HON. G.V. LAUK (Minister of Industrial Development, Trade and Commerce): The answer is no.

MR. SPEAKER: That is not truly a supplementary as I see it.

LOOPHOLES IN RENT
STABILIZATION ACT

MS. R. BROWN (Vancouver-Burrard): My question is directed to the Attorney-General. Is the Attorney-General aware that tenants are still being served eviction notices if they refuse to pay more than the 8 per cent increase on their rent?

Also, is he aware of the new and innovative way in which one landlord has decided to issue 99-year leases to tenants as a way of getting around the 8 per cent increases? If so, I wonder if he has devised any means of dealing with these two loopholes?

HON. A.B. MACDONALD (Attorney-General): Mr. Speaker, in answer to the first thing, there are some threats of eviction by reason of somebody not really being willing to live up to the 8 per cent restraint on rent law. I would hope the tenants in question who are subjected to any unfair threat of that kind would look to their legal remedies which I think are there in the legislation at the present time.

In regard to the second matter of the 99-year leases; in substance, that's really sale of strata condominium — technically a lease. That may be outside of the present legislation which puts control on that kind of a conversion situation in the hands of the municipalities and, as such, it's something the government is looking at very closely at the present time.

RELEASE OF RIVERVIEW
ORDER-IN-COUNCIL PATIENTS

MR. G.B. GARDOM (Vancouver–Point Grey): To the Attorney-General, Mr. Speaker. In view of the recent decision by Mr. Justice Munroe concerning the lack of validity of an order-in-council confining a patient in Riverview, could you inform us, please, what steps have been taken by yourself to insure that those people whose sickness requires such confinement are going to continue to be legally

[ Page 2928 ]

confined in Riverview?

HON. MR. MACDONALD: I've just seen a newspaper report of the reasons of Mr. Justice Craig Munroe, I think it was, who gave that decision. As I've said all along, I welcome clarification and even criticism in this field where so many interests are involved — from the security of the community, to the rights of the accused, to the right to be different, to the treatment of mentally-ill people — a very vital area that needs reform. We intend to get the reasons so we can look at the matter in terms of something to be done at once, even before the forensic service Act can become operative.

MR. GARDOM: Are we to take it from that, Mr. Attorney-General, that you'll not be ordering the release of the remainder of the order-in-council patients.

HON. MR. MACDONALD: I'll look at the reasons for judgment.

SUPPLY OF STEEL
TO BCR BOXCAR PLANT

MR. J.R. CHABOT (Columbia River): A question to the Minister of Labour as director of B.C. Rail. In view of Stelco's refusal to supply steel to the BCR carplant, what alternative plans does the government have to secure the necessary sheet metal and castings to construct boxcars in the much delayed Squamish plant.

HON. W.S. KING (Minister of Labour): I'll take it as notice, Mr. Speaker. I'm not aware of the situation.

CONTINGENCY PLANS
FOR VANCOUVER POLICE STRIKE

MR. G.F. GIBSON (North Vancouver–Capilano): A question to the Attorney-General, Mr. Speaker, as the final defender of the administration of justice in British Columbia. In view of the service of a strike notice by the police in the City of Vancouver, has the Attorney-General any contingency plans or is he cooperating in the development of contingency plans for the continuation of emergency police services should this strike take place?

HON. MR. MACDONALD: I'll take the question as notice.

PLAY DRUGS IN VICTORIA

MR. R.H. McCLELLAND (Langley): Mr. Speaker, my question is to the Minister of Human Resources. I wonder if the Minister is aware of a problem which has been raised in the City of Victoria with regard to so-called play drugs being sold in downtown Victoria, particularly something called snort-sniffing powder, which comes in all kinds of fancy flavours so the children can play at sniffing cocaine or play cocaine. I'd like to ask the Minister if he's aware and whether or not the alcohol and drug commission has any plans to do anything about this.

HON. N. LEVI (Minister of Human Resources): I'll take that question as notice.

Interjection.

HON. MR. LAUK: May I have some order, Mr. Speaker. I have a statement that will just occupy the balance of question period. The statement is in reply to the question by the Hon. Member for Columbia River (Mr. Chabot) to the Minister of Labour (Hon. Mr. King).

Interjections.

MR. SPEAKER: Order, please. Is this an answer to an oral question?

HON. MR. LAUK: It's an answer to an oral question if the Member wishes me to give it.

Interjections.

HON. MR. LAUK: That's fine with me, Mr. Speaker; it's in direct reply to the question by the Member for Columbia to the Minister of Labour. But I'll give the answer in the corridor if the Liberal leader wishes it.

Interjections.

Orders of the day.

The House in Committee of Supply; Mr. Dent in the chair.

ESTIMATES: DEPARTMENT OF
LANDS, FORESTS AND WATER RESOURCES

(continued)

Vote 137: Minister's office $105,352.

On the amendment to vote 137.

MR. D.M. PHILLIPS (South Peace River): Mr. Chairman, I just would like to add a few more comments to the reasons why I feel this amendment should pass in this Legislature — I realize that the Minister is anxiously waiting to get up. But before I do, I feel there are certain other facts that should be read into the record.

I would like to just briefly go into some of the background as to why this situation has occurred and

[ Page 2929 ]

how the Minister has allowed himself to get into the position where his yearning for power — the lust for power — to build up his empire is really overriding the best interests of the people of the Province of British Columbia.

As you know, Mr. Chairman; "a government investigation into the trading of the shares of Col-Cel prior to Victoria's takeover of the forest company has turned the spotlight on a long sequence of events which involves the Minister and involves this government and involves everybody in the province. "The deal actually was announced in this Legislature last April 2 by the Resources Minister, Robert Williams, who has been one of the key figures in the take-over."

I would like to quote some of the history behind this take-over from a well documented article in the Province of Wednesday, March 20, 1974, because it is very important to the case we have before us that all Members of this Legislature know the sequence of events leading up to the present operation where multi-national financiers are involved, and where the Minister has left himself wide open to be taken by the world financial community.

I would like to quote from this article, if I might, Mr. Chairman.

"An investigation of trading by a team of experts from the RCMP and British Columbia Securities Commission was ordered suddenly last Friday by Attorney-General Alex Macdonald after he had previously resisted demands by opposition MLAs for an examination.

"The opposition maintained that there were unusual trading patterns in common and preferred shares of Columbia Cellulose (Col-Cel) in the three months prior to the takeover. Claims were made that sloppy handling by the government allowed people to make a fortune.

"The opposition said that in 1972...shares traded each month was between 30,000 and 35,000 but that rose to 295,000 shares in January, 1973, one million in February and 675,000 in March. Share prices rose dramatically.

"The investigation team is now at work. The intention in this story is only to review the chronology. Much of it comes from newspaper clippings...and a little that has been learned since."

Mr. Chairman, in order to understand the background of this, we must realize again — a quote from the article — that:

"Col-Cel was owned 91 per cent by the Celanese Corporation of New York, and, despite its three pulp mills and extensive forest holdings in British Columbia, had been a financial disaster for years. Losses in operations and write-offs by the end of 1972 had reached about $95 million."

In other words, Mr. Chairman, since this organization was formed, Columbia Cellulose has lost $95 million in its operations in British Columbia.

I will quote further from the article:

"When James Wohl was appointed Col-Cel president in early 1972, he said in an interview that Celanese had decided in 1968 it wanted to sell its B.C. operations, had reappraised the decision in 1969 and hesitated but before the difficulties of 1970, had reconfirmed that it wanted out.

"The problems were well known to the former Social Credit administration before its defeat by the NDP in August of 1972.

"In mid-August of 1972, Weyerhaeuser Canada Ltd. announced that it signed a deal with Col-Cel to buy the money-making Castlegar operation for what was later learned to be $48 million. The Socred administration had made tentative plans to approve the sale then, if necessary, to place Col-Cel's northern operations under public trusteeship.

"After the NDP election sweep, Williams" — and that is referring to the Hon. Robert Williams, Minister of Lands, Forests and Water Resources — "phoned Williston and asked that the Socreds in the interim period between governments not take any action to approve the sale to Weyerhaeuser.

"In November and December of 1972, Celanese corporate officials from New York approached Williams who had then been appointed resources Minister directly without going through its board of directors which include Vancouver men, Charles C. Locke and James Sinclair."

The article further states that:

"The Minister delayed approval of the transfer of timber in the Castlegar operation and thus blocked the Weyerhaeuser deal. In October he ordered an assessment of the Castlegar operation and this was completed in November by F.L.C. Reed and Associates, Hugh Hodgins Ltd., Clarkson and Gordon and Co. and H.A. Simons Ltd.

"In the interim, Col-Cel's northern operations were examined by Japanese interests, by Price Co. Ltd. of Quebec. Price is understood to have made an offer to Col-Cel amounting to $15 million for the northern plants, payable out of their cash flow.

"Scott Paper Ltd. of U.S. became interested in Castlegar and is said to have made a bid of $50 million for these operations. G.W. Pepper, now retired, as one of the firm's top executives,

[ Page 2930 ]

was here to talk about the offer.

"Williams has said in interviews after the deal that he began in December, 1972 to consider whether the government should step in and buy out Col-Cel."

This is in December of 1972.

"In January of 1973, Celanese made a proposal that the government buy it out and was asked to put the offer in writing.

"On February 9, Williams announced that he had vetoed the sale of the Castlegar operations to Weyerhaeuser, claiming that it would weaken the Col-Cel northern operations and the tax credits involved would mean Weyerhaeuser would be tax free in B.C. for up to 10 years. Weyerhaeuser executives denied this.

"At this point a team was formed to conduct formal negotiations, including lawyers and chartered accountants. Merrill Lynch Royal Securities Ltd. was retained to do a plan on how the government could divest itself of all or part of Col-Cel if it did buy it. The report has not been made public."

This, Mr. Chairman, is just another example of government documents, government investigations that are being salted away somewhere and the Members of this Legislature not having access to them.

The article continues:

"On March 7, The Province carried a news story reporting the government was discussing with Celanese the purchase of the U.S. firm's holdings in Col-Cel. The next day the Company said there was no deal with anybody. On March 17, the government announced the purchase of Ocean Falls from Crown Zellerbach Canada Ltd. and reports then said that further developments were awaited on the Col-Cel purchase.

"On March 30 trading in Col-Cel shares was suspended." (This is a good four months after the original announcement was made.) "On March 30 trading in Col-Cel shares was suspended by the Toronto and Vancouver Stock Exchanges because of negotiations to sell the company's assets.

"On April 2 Williams announced the deal. The government would take over 79 per cent for guaranteeing the long-term debt. Common shareholders would get 7 per cent and preferred shareholders 14 per cent. In a complicated legal transaction Canadian Cellulose Company Limited, a Col-Cel subsidiary, became the new owning firm. There were a series of other financial commitments by Celanese."

HON. A.B. MACDONALD (Attorney-General): That's a good article.

MR. PHILLIPS: Yes, and it relays the history and also points out, as I will continue from the article:

"In a complicated legal transaction Canadian Cellulose Company Limited, a Col-Cel subsidiary became the new owning firm. There were a series of other financial commitments by Celanese. During all of this the shares of Col-Cel were rising. Early in December, 1972, the common shares traded at 60 cents in Toronto and preferred shares at $1.25" — That's in early December.

"By February 8 they had moved to $2.60 for common and $6.50 for preferred. And on March 29, just prior to the suspension of trade, the common was selling for $3.30 and the preferred shares for $7.75. In 1973 Canadian Cellulose shares traded as high as $10.50.

"On Tuesday they sold for $7 in Toronto. On February 22, 1973, Col-Cel did report a fourth-quarter, 1972, profit of $600,000, the first net earnings in three years."

This, Mr. Chairman, is some of the background of the Col-Cel take-over. It's well documented and I think it's important to the House.

Now that the company is owned 79 per cent by the British Columbia government it is very interesting to discuss some of the background of the directors who have been appointed by the government...

HON. MR. MACDONALD: The Midas touch.

MR. PHILLIPS: ...in order to fully understand the implications of who is really running this company and who stands, in the international money markets, to make huge rip-off profits — not only because of the shares that they own but because of the possibilities through their international tradings in Brussels and New York, the possibility to receive kickbacks and the possibility, Mr. Chairman, of receiving favours under the table.

AN HON. MEMBER: What a bunch of rot!

MR. CHAIRMAN: Order, please. I would just draw the attention of the Hon. Member...while the subject matter which he is discussing is not strictly out of order, there is a ruling that was made by Mr. T.J. Irwin, the Speaker of the Legislative Assembly, on January 24, 1956. I just want to refer to a couple of his comments.

"The Hon. Member for Mackenzie has mentioned the subject of forestry and in view of the fact that this natural resource is under consideration of the commission at the present time, I would suggest that you deal with the subject as little as possible."

And further he says:

"In regard to matters before commissions it

[ Page 2931 ]

is a custom to refrain from discussion of subject matter before a commission. In fact, in Great Britain the matter is strictly avoided in all respects."

Now it's a matter of courtesy to the present inquiry commission that is looking into this matter that was referred to by the Hon. Leader of the Opposition. I point out again that while it is not strictly out of order it is, I think, proper to deal with the subject judiciously.

MR. W.R. BENNETT (Leader of the Opposition): Mr. Chairman, I know of no royal commission as you are referring to that was in operation at that time.

MR. CHAIRMAN: Order, please. I'm referring to the inquiry commission that was requested by the Hon. Leader of the Opposition and ordered by the Hon. Attorney-General to deal with the matter of the acquisition of Col-Cel.

MR. BENNETT: There was no inquiry commission, Mr. Chairman. Mr. Chairman, on a point of order again, I dispute that because it's not a royal commission that that ruling referred to. This is an internal inquiry inside the department.

MR. CHAIRMAN: Order, please. I'm not saying that it's out of order; I'm merely reminding the Hon. Member that this area is before an inquiry commission and, therefore, should be dealt with judiciously.

MR. BENNETT: Well, I'd just further point out, Mr. Chairman, that I have confidence in the staff of the Attorney-General that they won't have their commission compromised by anything that's said in this House. It isn't like a public inquiry where the public is making submissions.

HON. MR. MACDONALD: Just for clarification, I think the investigation is one under — if I remember the number correctly — 23(2) of the Securities Act.

MR. PHILLIPS: But the reason I'm discussing the directors of this company is because, after all, the people of, British Columbia do own 79 per cent of this company. It's been the stated policy of the government — as I mentioned last evening or at least during the estimates of the Minister of Housing (Hon. Mr. Nicolson) — that no individual should be allowed to make a gain by holding shares in a company in which the government holds the majority of the shares.

I think it's very interesting, when we get into this web of intrigue surrounding this Can-Cel deal, that the Legislature be advised of the background of these directors — particularly the fact that four of the directors, and indeed the president-director, were alien to British Columbia until just a short time ago and are involved in world-wide paper and newsprint operations.

I think it's very important that we understand who is actually running this company for the government and for what reason. Now the president-director, Can-Cel is Mr. Ronald M. Gross. In 1973 Mr. Gross stated that he was 39 years of age, born in Cleveland, Ohio....

Interjection.

MR. PHILLIPS: Well, he has a BA degree in biology science at the Ohio State University.

HON. R.A. WILLIAMS (Minister of Lands, Forests and Water Resources): I think he went to Harvard too.

MR. PHILLIPS: But he also has an MBA degree from the Harvard Graduate School of Business Administration.

After Harvard he joined the Champion International organization as associate to the chief of operations research corporate staff in Hamilton, Ohio, and in six years rose to vice-president of finance and treasurer of the corporation's international division in New York.

So we know now that Mr. Gross certainly has a connection and, in all probability, several close friends in Champion International, which is a very large multi-national corporation, one of the corporations that the Minister says....

AN HON. MEMBER: Bring that bat boy back.

MR. PHILLIPS: He's referred to them in the House as being rip-off artists and big, giant multi-national corporations from the States. I'll tell you just how large Champion International is in a few moments, if you'll just bear with me. But I did want to relate to the Legislature the connection between the president and the director, Ronald Gross, and his relation to Champion International.

Interjection.

MR. PHILLIPS: Well, that's a kind of a stupid question from the Minister of.... The Minister's always talking about big, giant multi-national rip-off corporations and here he's in bed with one of the biggest; and so are the directors of this company.

AN HON. MEMBER: Laugh that off.

MR. PHILLIPS: Now in 1968 Mr. Gross joined the Columbia Cellulose Company Limited as its secretary

[ Page 2932 ]

and from 1970 until the takeover by the government in June of 1973 was executive vice-president of the company. In 1962 to 1968 he was with the Champion International Company — associate to the chief of operations research corporate staff in Hamilton, Ohio; and, as I said before, he rose to vice-president. That is the president-general manager.

We have another director of Col-Cel. This gentleman has never to my knowledge, by the research I have done, lived in British Columbia. He is a man by the name of Max Litvine who lives in Brussels, Belgium. This man doesn't hold any shares in Col-Cel but he is the managing director, according to the Vancouver Province report of June 30, 1973, of La Compagnie Lambert, a holding firm for Banque Lambert.

AN HON. MEMBER: Oh, a banker.

MR. PHILLIPS: Yes, an international banker at that. He was the former secretary-general of Sabena Airlines, Belgium, a government-owned airline.

HON. R.A. WILLIAMS: The state airline?

MR. PHILLIPS: At the end of 1972, Litvine was a director of S.A. Intermills (Champion International) but resigned as a director during 1973. We're unable to find from our research why Mr. Litvine resigned from being a director of Champion International. According to a local Brussels trade journalist, Litvine now probably devotes all of his time to Haseldonckx company.

HON. R.A. WILLIAMS: The one we got for free.

MR. PHILLIPS: Yes, which is 50 per cent owned by Can-Cel. So he devotes 50 per cent of his time to Haseldonckx. He's a director of Col-Cel, and Haseldonckx is 50 per cent owned by Can-Cel.

I would like to know from the Minister, when he answers in the Legislature, if Mr. Litvine is the money man behind Can-Cel, or, indeed, maybe the money man for the provincial government itself?

Interjection.

MR. PHILLIPS: Well, it's all very well and good. You might think this is very funny but we'll see what the answers are, Mr. Chairman.

HON. MR. LAUK: No wonder they told me all that stuff about you in Dawson Creek.

MR. PHILLIPS: We have another director of Col-Cel, a man by the name of Ira David Wallach, lawyer and business executive, born in New York City. He married Miriam Gottesman, and now

Gottesman & Co. are selling the newsprint from Ocean Falls Corporation.

Mr. Wallach has been involved in several multi-national corporations. In 1952 he was executive vice-president of Gottesman & Co; in 1956 he was president.... Oh, pardon me, in 1947 he was a director; in 1956 he became president and has been involved with them ever since. He has also been involved with the Central National Corporation of New York City and became president in 1956. He has also been involved with Southwest Forest Industries of Phoenix.

We'll have to explore the amount of connections that Gottesman and Company have with the newsprint and pulpwood paper industry in the world in order to understand what his connections could be through Col-Cel. We must also realize that Ira D. Wallach is also a holder of several thousand shares in Col-Cel.

AN HON. MEMBER: That's part of that 21 per cent.

Interjections.

MR. PHILLIPS: Gottesman-Central National Organization deals extensively in many places in the world. They have associations with operations in Portugal. They also have associations with Crestbrook Forest Industries. Crestbrook Forest Industries, I would predict, is on the Minister's lineup for takeover very shortly.

HON. MR. LAUK: It doesn't make enough money, Don.

MR. PHILLIPS: Well, maybe Gottesman sells and deals in newsprint and pulpwood throughout the world. They have consulting services, and they're a large multi-nation corporation.

Now, we have some of the background of Col-Cel and we have some of the international implications. I wonder if the Minister really realizes just who he is dealing with. In this web of companies we have, we find that Champion International, which controls Intermills, and Intermills controls 57 per cent of Gastouche. But Haseldonckx, which is also owned 50 per cent by Can-Cel, has a 43 per cent interest in Les Papeteriesde Gastouche. I'd like to know who owns the other 50 per cent of Haseldonckx. Who is involved, and in what way, in the other 50 per cent? The Minister talks about multi-national corporations. When we look at the chart, you can plainly see that Champion International really has a large say in Les Papeteries de Gastouche.

Interjection.

[ Page 2933 ]

MR. PHILLIPS: I will. The Minister is always talking about large international corporations. How large is Champion International? The Minister has a great distaste for international corporations and yet he's dealing with them. Champion International in 1971 was the 73rd largest world corporation and rose in 1972 to the 62nd largest world corporation with sales of $1,871,735,000.

Let's just compare that with some of the other giants the Minister has such a distaste for. Let's compare that for instance with Crown Zellerbach. Crown Zellerbach in 1972 was the 127th largest company in the world with sales of $1,112,928,000 — quite a fair amount smaller corporation than Champion International that he's in bed with.

He also seems to have a distaste for MacMillan Bloedel. MacMillan Bloedel is the 112th largest corporation in the world, but they are basically a Canadian Company. Their sales were only $973,253,000 in 1972.

The purpose of this is to point out that there certainly was here in British Columbia companies which had the knowledge, companies which had the expertise, knowledgeable people in the pulp and paper business, knowledgeable people in the forest industry not connected with as large a multi-national corporation as the Minister has chosen to deal with. When this expertise was available in the province, why was not the Minister able to find directors for the Can-Cel Corporation?

Why did he have to go to directors out of the province? And I admit that there are four directors who are Canadian citizens....

HON. R.A. WILLIAMS: Just name them.

MR. PHILLIPS: Well, all right. If you want me to name them for the record, I'll be most happy to name them for you.

The unfortunate thing is that of the other directors none of them seem to have that much say or that much knowledge actually in the forest industry.

HON. R.A. WILLIAMS: Just businessmen.

MR. PHILLIPS: Well, they're businessmen, yes, but as directors of a corporation you certainly want expertise What I'm trying to point out, Mr. Chairman, is that the people who are actually going to run and have the say in running Can-Cel are going to be the directors who have not been living in Canada that long, and directors who have dealings with these multi-national corporations.

We have as a director Donald Watson, who is the president of Pacific Western Airlines, formerly vice-president of management of Technical Services of Pacific Western Airlines; John A. Spicer, vice-president of the Mountain Region of Canadian National Railways, formerly assistant vice-president of Canadian National Railways. But Mr. Spicer doesn't own any shares and Mr. Watson only owns 100 shares.

We have Harry L. Purdy, management consultant, formerly lecturer at the University of British Columbia, and Charles L. Locke, who was the only previous director of the Col-Cel operation.

What I am pointing out, Mr. Chairman, is that the people who are really going to run this operation....

HON. R.A. WILLIAMS: You missed one.

MR. PHILLIPS: Allan S. Gordon, consultant to Merrill Lynch Royal Securities Limited.

None of the — I will term them — Canadian directors have had any expertise in the forest industry. So the people who are really going to run this corporation, which is owned 79 per cent by the people of British Columbia, are going to be the people who have not had that much experience in the previous operation of a forest industry.

Somehow, Mr. Chairman, I missed one director here.

This is such a web of international intrigue that it is very difficult to....

Interjection.

MR. PHILLIPS: Yes, you'd need a Scotland Yard. You'd need a Scotland Yard all right to get it all straightened out.

However, the point is, Mr. Chairman, that these gentlemen are connected with the international financiers, and I would like to know just what connections and how much opportunity there will be for these directors — who will be dealing in Brussels and who will be dealing with the products of this British Columbia corporation — to receive payoffs in Brussels....

AN HON. MEMBER: Oh, come on now!

MR. PHILLIPS: Well, come on. These people are connected through the interlocking companies. We don't know. We can't receive in this Legislature any of the documents. The Minister wants to be secretive. He won't file any of the documents. How are we to know? We asked him for the document, the sales agreement, with Gottesman and Company for the sale of Ocean Falls, and what did we receive? Nothing.

AN HON. MEMBER: That's right.

MR. PHILLIPS: Because that newsprint is being sold not directly to a consumer, but it is being sold directly to Gottesman for a price far below the market price.

[ Page 2934 ]

HON. R.A. WILLIAMS: Oh, really?

MR. PHILLIPS: Yes, far below the market price. However, the Minister smelled a rat. He knows he's in trouble. He won't file the documents. So he comes out in the paper yesterday and he says, "I'm going to renegotiate it."

HON. R.A. WILLIAMS: It's already been....

MR. PHILLIPS: And knowing that Minister, if he feels it desirable to do so, he'll break the contract. Why can't we receive the survey that was done on Ocean Falls?

HON. MR. MACDONALD: I thought you were talking about Col-Cel.

MR. PHILLIPS: No, no. You're confused. Well, you should be confused, and I don't suppose, Mr. Attorney-General, that you really know what the Minister himself is doing. But the Minister is in bed with a group of international financiers.

HON. R.A. WILLIAMS: I'm not even on the board.

MR. PHILLIPS: Oh, you're not even on the board. I'll tell you, Mr. Chairman, that they are using this Minister like a puppet on a string.

AN HON. MEMBER: Yes, and that's happened frequently.

MR. PHILLIPS: Yes, it's happened.

Interjections.

MR. PHILLIPS: And it will be the people of British Columbia who will lose millions on their forestry operations.

A good example of what can happen is the Ocean Falls deal, and the same thing can happen to Col-Cel.

HON. R.A. WILLIAMS: Oh, oh!

MR. PHILLIPS: The Minister moans. I'll tell you that I moan too when I get into finding out exactly what a web we have here.

HON. R.A. WILLIAMS: Especially when you count the money for the people.

MR. PHILLIPS: Well, the Minister talks about money for the people. You know we had an episode not very long ago in Manitoba...

MR. R.T. CUMMINGS (Vancouver–Little Mountain): Tell us about the used car sales.

MR. PHILLIPS: ...where the experts came in and advised the Manitoba government, and in their haste to make what was going to be a quick profit for the people of Manitoba the New Democratic government there proceeded and got ripped off by the international corporations because they had bad advice.

Here we have this Minister moving ahead in his desire to build up for himself a quick empire. He has gone outside the province to get directors for the company. He has got people who have many more interests elsewhere in the newsprint business and in the financial world, whose interest will be.... It will be in their own interests to see that this corporation takes over literally all of the forest industry in British Columbia, and it will all be under the umbrella of Can-Cel.

These directors who have the shares in Can-Cel will certainly stand to gain, and they will be able to control the markets while they have their fingers in other pies. And you talk about multi-national corporations?

Now, Mr. Chairman, we have as one of the directors of Can-Cel a man by the name of Ira Wallach, who is also the president of Gottesman Company in New York, who are world-wide sellers of pulp, linerboard and newsprint. Mr. Wallach, as we have said here before, has an ongoing sales arrangement for all newsprint produced at Ocean Falls.

I would like to know, and I'm going to ask the Minister again, why he is allowed to buy it at the California price, which is $2.13 per ton, less $18 freight...

HON. R.A. WILLIAMS: That's $213 minus $18, yes.

MR. PHILLIPS: ...which nets Ocean Falls $195 per ton; and yet this man is free to resell it anywhere in the world and retain the markup. And today's current price is $640 on the black market.

Now, Mr. Chairman, I ask you: who's being ripped-off? We asked for a copy of this sales agreement and the Minister flatly refuses. Well, I ask the Minister: if there is nothing to hide, and if our facts and figures are not right, why doesn't he table the document?

MR. A.V. FRASER (Cariboo): Public business.

MR. PHILLIPS: It's the public's business. Why don't you let the light shine in a little bit? I'll tell you why, Mr. Chairman. Because he doesn't want to reveal to this Legislature that Gottesman and Company and Ira D. Wallach probably ripped off last

[ Page 2935 ]

year about $8 million. That's why he doesn't want to table the document.

This man could make probably upwards of anywhere from $8 to $15 million by selling on the black market newsprint from Ocean Falls, while that corporation shows a loss of $850,000 on its operations.

Interjection.

MR. PHILLIPS: The Minister of Lands, Forests and Water Resources says "garbage." I defy the Minister to file that document in this House. Let us have a look at it. Until he does, I charge him with allowing Gottesman and Company to rip off Ocean Falls anywhere — I don't know what the exact production is — from $8 million to $15 million of money that should belong to the people of British Columbia.

I ask the Minister: why is he renegotiating? Why doesn't he sell direct? Why did he cancel the sales agreement he had with Crown Zellerbach? Why was it given to Gottesman and Company? Why was it given to Ira D. Wallach, who was also a director of Can-Cel? This man, who stood to net $8 million last year, sits on the board of a government company — Can-Cel — from its date of takeover.

MR. D.E. SMITH (North Peace River): He laughs all the way to the bank.

MR. PHILLIPS: This is the very thing this opposition pointed out would happen when the Ministers of the Crown and indeed the cabinet get into business such as they are in, taking over from the private sector.

Tell us, Mr. Chairman — why was the contract with Crown Zellerbach cancelled? Why was Gottesman and Company put in as a buyer instead of an agent? Crown Zellerbach was acting as an agent to sell the newsprint from Ocean Falls, and if they sold it for a good price, Ocean Falls received the profits. It wasn't a firm price, but now we're selling the newsprint to a company that buys it at a fixed price and has the right to resell it wherever and to whomever they desire. Where is it going? It's going to countries in this world of the third generation who are trying to bring themselves up to our standard of living.

HON. R.A. WILLIAMS: The third world, you mean?

MR. PHILLIPS: Third world. You know what I'm talking about — you know where the black market is.

AN HON. MEMBER: Oh, it's incredible.

MR. PHILLIPS: And also this Gottesman and Company have sales affiliation with Crestbrook Timber. Crestbrook Timber, as you well know, have been damaged by the takeover of Kootenay Forest Products — all part of the web, all part of the takeover. It's all very well and good for the Minister to laugh.

HON. R.A. WILLIAMS: It's such a tortuous route.

MR. PHILLIPS: It's also interesting to note, Mr. Chairman, that when Gross was made a director of Can-Cel, he said that Can-Cel would be a large...and I don't want to quote this wrong: "The company would seek additional timber in the Kootenays." This was long before it was announced in this Legislature by this Minister that the government would be taking over Kootenay Forest Products.

MR. SMITH: How did he know that? Inside information?

MR. PHILLIPS: Who knows all this information? Do the other directors know? How did Mr. Berkley, your other directors, know that Can-Cel was going to be a large timber operator in British Columbia? I'd like to quote from an article in The Vancouver Sun on August 11: "Berkley said he believed that Can-Cel will be developed into a major forest company in a matter of years."

Mr. Chairman, this statement was made on August 11, 1973, approximately four months after the takeover of Col-Cel by the British Columbia government. How did this man Berkley know this?

HON. R.A. WILLIAMS: I guess I used WAC's stuff. He was the financial genius around here for so long. We might talk about that a little later.

MR. CHAIRMAN: Order, please. I would ask the Hon. Minister not to speak from his seat.

AN HON. MEMBER: I'm worried about that guy.

HON. R.A. WILLIAMS: We need a genius like W.A.C. Bennett. That's what we need.

AN HON. MEMBER: I have an Eaton's catalogue — would that be of any help to you?

MR. PHILLIPS: Well, I'll tell you, the research that's been done on this could almost fill an Eaton's catalogue. But who is Mr. E.B. Berkley?

HON. R.A. WILLIAMS: He's the president of Tension Envelopes.

MR. PHILLIPS: Yes, that's right. Where does he hail from?

[ Page 2936 ]

HON. R.A. WILLIAMS: Oh, he's an American.

MR. PHILLIPS: He's an American.

HON. R.A. WILLIAMS: And a Republican.

MR. PHILLIPS: He's also a graduate of Harvard business administration. He's a Republican from Kansas City, Missouri.

HON. R.A. WILLIAMS: Trained at Harvard.

MR. PHILLIPS: Trained at Harvard. What I'd like to know is how this Mr. Berkley knew that Can-Cel was going to be developed into a major forest industry. How did he know that back in August, 1973?

HON. R.A. WILLIAMS: I guess he looked at the nine million acres and thought there was a potential there.

MR. PHILLIPS: Is he a friend of the Premier's?

HON. R.A. WILLIAMS: A Republican from Kansas City?

MR. PHILLIPS: Could be. Stranger things have been known to happen.

This Mr. Berkley is a third generation family from Kansas City.

HON. R.A. WILLIAMS: Good heavens — maybe the Mayflower, too.

MR. PHILLIPS: He's president and director of the Tension Envelope Corporation of Texas, Tension Envelope Corporation of Minneapolis, the Tension Envelope Corporation of Iowa and Tension Envelope Corporation of Missouri. He's president and director of all these corporations.

HON. R.A. WILLIAMS: It's a web again.

MR. PHILLIPS: It's a web.

HON. R.A. WILLIAMS: Right.

MR. PHILLIPS: I want to know how this man knew what was going to happen to a British Columbia corporation. I ask you again, Mr. Chairman — is this man a friend of the Premier? Is his family on first name speaking basis with the Premier?

HON. R.A. WILLIAMS: I'm sure they've never met.

MR. PHILLIPS: It's something for you to think about and I'd like to have the answer.

HON. D.G. COCKE (Minister of Health): The answer is no.

MR. PHILLIPS: Mr. Wallach also has an office in Phoenix, Arizona, where George Scrimshaw, former chairman of Columbia Cellulose now has a home office operating International Marketing and Development Company.

HON. R.A. WILLIAMS: We've left Berkley, have we?

MR. PHILLIPS: Well, I might come back to him. It's a business similar and possibly related to Wallach-Gottesman International. Mr. Chairman, we're talking about Berkley and the Minister of Lands, Forests and Water Resources seems to take it as such a joke. Where did Mr. Berkley come from?

HON. R.A. WILLIAMS: From Kansas — three generations ago.

MR. PHILLIPS: How did he happen to become a director of Can-Cel? I'd like you to answer that question. Are you going into the envelope manufacturing business?

HON. R.A. WILLIAMS: You never know.

MR. PHILLIPS: You never know. What connection has Mr. Berkley with Col-Cel? He didn't have any. How come he became a director of Can-Cel? Is he a friend of Ira Wallach's?

Interjections.

MR. PHILLIPS: You know, Mr. Chairman, it's all very well and good for the Minister of Lands, Forests and Water Resources to make jokes, but had he come clean with this Legislature we wouldn't have to be here today asking these questions, trying to find out what is going on in a company where four directors outside of this province, alien to the province, stand to make huge rip-off profits.

All you have to do is answer the questions. You had three opportunities last night to stand up and file documents or answer questions. But no, you are the strong, silent type....

MR. CUMMINGS: Sit down and he'll tell you.

MR. PHILLIPS: No one can dare question the Minister of Lands, Forests and Water Resources. He keeps his business dealings to himself.

Interjection.

[ Page 2937 ]

MR. PHILLIPS: We are going to have an election in Ottawa, I would just Eke to announce to those in the Legislature who haven't heard, that the Trudeau government has been defeated.

The citizens of British Columbia also want an election. We want an election so we can find out what is going on behind the intrigue of the power magnate in the cabinet, the self-appointed empire-builder.

HON. R.A. WILLIAMS: Tell me about Wenner Gren.

MR. PHILLIPS: You know, Mr. Chairman, the Minister wants to live in the past. I want you to know that today is 1974 in British Columbia...

HON. R.A. WILLIAMS: Very good, very good.

MR. PHILLIPS: ...and we are accountable for what we do today. The Minister of Lands, Forests and Water Resources has got to be accountable for what he is doing today.

Mr. Chairman, Mr. Scrimshaw was at one time the President of Col-Cel. He left and Mr. Gross came in and took over. Mr. Scrimshaw and Mr. Gross, the president of Can-Cel today, are business associates of long standing, Gross formerly worked in areas directly connected with Wallach, and is considered in New York circles to be a protege of Wallach.

But there still seems to be a big question around Mr. Berkley — how he was appointed. Maybe the Minister would care to explain to the Legislature on what basis these directors were chosen.

I think we will have to draw our own conclusions since the Minister won't tell us. I have reason to conclude that Wallach, Scrimshaw and Gross have connections and mutual interests which could be in conflict of interest with the publicly owned Can-Cel.

Maybe they are connected with Max Litvine, who is connected with the world's syndicate of money-makers. And he had something to do with Churchill Forest Products which is under question in Manitoba. He is the director of a Belgian holding company which controls Banque Lambert, a large institution financing in international trade. Why was this gentleman chosen, Mr. Chairman, as a director of the publicly owned — by 79 per cent — Can-Cel?

Mr. Wallach also maintains an office in Belgium, and Scrimshaw was formerly a director of Intermills, the Belgian firm that merchandises pulp and paper. The company was partly acquired by Champion International from which was spun out Haseldonckx, formerly a subsidiary of Columbia Cellulose, and now a Belgian firm owned by the B.C. government company.

Maybe the Minister would like to stand up and make some comments at this time. Oh, he's going out.

HON. R.A. WILLIAMS: I'll be back.

MR. PHILLIPS: Mr. Chairman, unfortunately, there seems to be a mysterious and clouded reason why Scrimshaw got Columbia Cellulose into, Belgium, the nature of the dealings in Belgium of Intermills, the Gastouche and Haseldonckx.

It is very interesting, Mr. Chairman. I certainly hope the Minister will let the light shine in. You know, when we came into the Legislature today, I thought there was a cloud over the Legislature. I thought that cloud might be the cloud surrounding the questions directly concerned with the Minister of Lands, Forests and Water Resources.

Mr. Litvine, who is a director of Col-Cel, through the British Columbia government, retains this obscure Belgian company. It is even more curious why Litvine was appointed a director. I would still like to know why, Mr. Chairman.

The mystery also surrounds Champion International's role in Belgium, and its. former relationship with what is now a Can-Cel subsidiary. Knowledge of this relationship could explain why Weldwood-Champion, the B.C. wing of Champion International, and Can-Cel seek a joint venture in the British Columbia sawmill at Burns Lake.

I think the whole of British Columbia is going to be Champion-ized.

Even more curious is the activity of Arthur D. Little of New York. This firm was involved in the Manitoba situation respecting Churchill Forest Products. Mr. Little was adviser to the Manitoba government, as well as representative of the financial group from Switzerland and Belgium which allegedly defrauded the people of Manitoba. Are these the type of people we are dealing with, Mr. Chairman? Are the people of British Columbia going to be defrauded in the long run because of this Minister's dealings with a group of international financiers that will eventually treat him like a puppet on a string?

Little was also employed by Scrimshaw and Columbia Cellulose in Prince Rupert, engaged in preparing a prospectus to sell the, operation. The web gets thicker and thicker.

Now, I would like to return for just a moment to Mr. Berkley. I would ask the question again to the Minister: will he advise how and why Mr. Berkley became a director of Can-Cel? He is the President of a Kansas City, Missouri, envelope manufacturing and distributing company. I would like to ask the Minister if Mr. Berkley or any of his family have any connections with the Premier of this province.

HON. R.A. WILLIAMS: None that I am aware of.

MR. PHILLIPS: None that you are aware of. Then tell me how Mr. Berkley knew in August of 1973 that

[ Page 2938 ]

Can-Cel was going to take over many more operations in British Columbia.

Interjection.

MR. PHILLIPS: He says it is going to be.... I'll say it again — it will be developed into a major forest company in a matter of years.

HON. R.A. WILLIAMS: By using the trees they already have — by using the 9 million acres well.

MR. PHILLIPS: This is a company that previously had lost $95 million. I would suggest that Mr. Berkley had conferences with the Premier and the Minister of Lands, Forests and Water Resources. I would also suggest that this is all....

HON. R.A. WILLIAMS: I never met him before.

MR. PHILLIPS: You've never met the director. Well now, that is an interesting twist. Here is a director of a company which is overseen by the Minister of Lands, Forests and Water Resources, and the Minister says he has never met one of the directors.

HON. R.A. WILLIAMS: Well, I have met him.

MR. PHILLIPS: Oh! you have met him? Oh! now we have met him. Oh! I see, now we have met him — well.

So I will continue my previous conversation. I am suggesting, Mr. Chairman, that there is a plan developed by the Minister, developed by the Premier, to eventually take over all the forest industries in the Province of British Columbia.

HON. R.A. WILLIAMS: Table it, table it.

MR. PHILLIPS: I am suggesting that there is such a plan. I am suggesting that some of the architects of the plan, besides the Minister and the Premier, are Mr. Berkley, Mr. Litvine, Mr. Gross, and Mr. Wallach.

I would suggest that they are the architects of this master scheme, and that we have just seen a very, very little bit of it. I would suggest that these directors, these foreign directors on this company — Col-Cel will certainly be the vehicle through which all the acquisitions are made — will move from place to place in the province.

We will go in and first of all do a survey, Mr. Chairman. We will do a market study because we want to make sure it's economically feasible. Then we will say to the recreation people that this timber should not be cut. We should take it away from forest industries that presently hold the rights.

Then, when these forest industries can't survive because of lack of timber, when they start to go broke, when they're on the brink of suffering financial disaster because of lack of timber which this king-maker controls, then Col-Cel will move in and say that to preserve the jobs of the people working for these companies we will have to take it over.

That's all part of a master plan and I want to say that the Minister has been playing his game of takeover very well. He does it very effectively.

While the Premier and the Minister of Industrial Development, Trade and Commerce (Hon. Mr. Lauk) are in Japan seeking Japanese help to build a steel mill, the Minister is out playing his game with other Japanese investments in the province — namely Crestbrook — taking away their timber, putting on the squeeze.

How long does the Minister think before the investments that are in this province from other countries...how long do you think before those people who have those investments are going to wake up to your grand scheme? I certainly hope, if Mr. Litvine has access to the bank in Brussels, that he's got lots of money, because you're going to need it.

Mr. Chairman, how much longer does the Minister think he can play with foreign investments — play with it like a cat plays with a mouse — and expect it to come into the Province of British Columbia in what used to be a safe investment?

I think- that the Minister is being very, very short-sighted indeed. If this province is to grow and prosper, unless he plans on taking over the entire forest industry — which I'm sure is his plan — we are going to need outside capital.

But maybe the Minister has sources of outside capital. Maybe these directors who are in this corporation, and who stand to make fantastic gains, are going to supply the money. Because there are many billions of dollars invested in the forest industry in British Columbia — many billions of dollars.

Are we creating in this province another Mr. Fines? Are we going to have the defeat of the NDP government in B.C. In 1976 and have several millionaires walk off the scene?

Interjection.

MR. PHILLIPS: 1975? Oh! the election is going to be in 1975?

AN HON. MEMBER: No, he said, "You're sick."

Interjections.

MR. PHILLIPS: Well, it's all very well and good for you to toss those terms around, but when this Legislature can't be provided with the facts, what else are we to think? What is so suspect, Mr. Chairman,

[ Page 2939 ]

about these documents that they can't be tabled in the Legislature?

People who were sent here by the electorate to keep this government honest are having a very difficult job indeed, particularly with that Minister. The problem is that he's not only indicting himself but he's doing it to the rest of the cabinet and indeed to every backbencher on the NDP side of the House.

Why is the Minister absent from this Legislature today? He doesn't receive his doctorate until Saturday. I'll tell you why, Mr. Chairman. He didn't want to be here while this Minister's estimates were going through the Legislature. But they're in it together.

MR. CHAIRMAN: Order, please. I would draw to the attention of the Hon. Member standing order 61 (2): "Speeches in Committee of the Whole House must be strictly relevant to the item or clause under consideration." We are considering vote 137 in the Minister's estimates. I would ask the Hon. Member to confine his remarks to the vote.

MR. PHILLIPS: Mr. Minister, that's exactly why we are having a vote of no confidence in this Minister today — exactly why. This Minister has set himself up over and above the rest of the cabinet, trying to build his own empire. He's in cahoots with the Premier. The Premier knows what's going on but the rest of the cabinet don't.

The Premier chose not to be here while these questions were being asked, because the Premier knew these questions would be asked. The Premier knew that this Minister had his government in trouble and that's why he's not here today. That's why we have this vote of no confidence in this particular Minister — this super Minister.

HON. R.M. STRACHAN (Minister of Transport and Communications): I can hardly believe it. I didn't believe you'd be so silly as to move a motion of non-confidence in this Minister.

MR. PHILLIPS: Well, the Minister of Transportation and Communications says it's silly.

HON. MR. STRACHAN: Nobody would believe that you'd be that silly.

MR. CHAIRMAN: Order, please.

MR. PHILLIPS: Mr. Chairman, the Minister doesn't know what's going on behind the scenes. He's not in with the Premier and the Minister of Lands, Forests and Water Resources on this plan to take over the entire forest industry in British Columbia.

AN HON. MEMBER: Oh, oh!

AN HON. MEMBER: And next the world!

HON. MR. STRACHAN: Don't talk nonsense. Come on now.

Interjections.

MR. PHILLIPS: I suppose, Mr. Chairman....

HON. MR. STRACHAN: Be reasonable.

MR. PHILLIPS: Don't talk nonsense. I remember when the bill to take over Col-Cel was going through the Legislature. I remember when the bill to take over Ocean Falls was going through the Legislature and we debated them and, oh, it was "to save the jobs of the people."

HON. W.S. KING (Minister of Labour): Do you remember B.C. Electric?

MR. PHILLIPS: It was to save the jobs of the people, but nobody came to the Legislature when we took over Plateau.

Nobody came back to the Legislature. No, the Minister has his vehicle now. He doesn't have to consult with the rest of the cabinet. He doesn't have to consult with the back bench because he's got his company. He's got the nucleus of it.

He didn't have to come to the Legislature to take over Kootenay Forest Products. He won't go back to the Legislature when you take over Crestbrook. You won't go back to the Legislature when you take over Eurocan.

AN HON. MEMBER: You're talking nonsense.

MR. PHILLIPS: Nonsense, my foot! If I had told you last year when these bills were passing through the House that you were going to force Plateau to sell, you would have said, "Oh, nonsense." If I had told you last year that you were going to take over Kootenay Forest Products you would have said, "Oh, nonsense."

HON. MR. STRACHAN: Yes, and you are talking nonsense still.

MR. PHILLIPS: I'm telling you now. You will take over Crestbrook. You'll take over Eurocan.

HON. MR. STRACHAN: Absolute nonsense. You don't know what you're talking about.

MR. PHILLIPS: I know what I'm talking about, but you don't know because you're on the outside. You're not in on the scheme. You're not in on the grand blueprint. You don't know as much about

[ Page 2940 ]

what's going on as these foreigners.

MR. CHAIRMAN: Order, please. Would the Hon. Member address the Chair, please?

Interjection.

MR. CHAIRMAN: Order, please!

MR. PHILLIPS: Yes, Mr. Chairman?

MR. CHAIRMAN: Would the Hon. Minister of Transport not interrupt the Hon. Member?

HON. MR. STRACHAN: I'm not interrupting him. I'm trying to get him on the right track and help him.

MR. PHILLIPS: Had the Minister of Transport and Communications done some research himself he might know, but I'll tell you he will never find out in a cabinet meeting, Mr. Chairman. He'll never find out in a cabinet meeting because he's not in the know. He's not in with the powerhouse. As a matter of fact, he's probably scared of the Minister of Lands, Forests and Water Resources like all the other cabinet Ministers and all the other backbenchers. He's got them frightened.

We can see it on this side of the House. They come running to him like chickens to the old hen. They gather under his wing. They want to be under his protection. We see what's going on, Mr. Chairman. But this Minister has abused the power of his office. He has abused the rights of this Legislature. He's making a farce out of the Legislature.

HON. R.A. WILLIAMS: Now that's a bit thick after....

MR. PHILLIPS: He's making an absolute farce out of the Legislature.

HON. MR. STRACHAN: That's what you've been doing for two years.

MR. PHILLIPS: I want to tell you, Mr. Chairman, that if I were a Minister of the Crown, I would let my dealings stand up to the light of day. That Minister is afraid; he's scared to let his dealings stand up to the light of day because these directors he has in Can-Cel have got him wrapped around their finger.

Interjections.

MR. PHILLIPS: That's right. Sure.

Interjections.

MR. PHILLIPS: Mr. Chairman, I hope all of the Members of the back bench will stand up and be counted when we vote on this motion of no confidence. I hope they will realize what a serious problem the Minister has. I hope they will ask him to see the documents in their speeches in support of this motion.

I want to tell you, Mr. Chairman, this type of wheeling and dealing is against the very thing that the Minister says he stands for: looking after the little people against multi-national corporations. Now he's in bed with them and I'm afraid he's getting skinned. I'm afraid the people of British Columbia are getting skinned.

Maybe the Minister could tell me when he answers the questions why a sum of $1,178 was paid out to Berkowitz E, Berkowitz L, and Ellis-Con ET. Is this a relation to Mr. Berkley, one of the directors of Can-Cel?

There are many questions still to be asked and much to learn from this Minister, so I'm going to leave it at that for the present time. But I do hope that the Minister will enlighten the Legislature so that we don't have to make these accusations and don't have to feel this way.

It is he who has led us to believe that there are wrongdoings in his department simply by his secrecy. He thinks he is above this Legislature, that he doesn't have to answer to the Legislature, that anything he does is okay and it shouldn't be questioned as he continues his game of takeover by takeover and continues to build an empire for himself over and above and apart from the Legislature, away from the cabinet and away from the hands of the back bench. An empire builder — an egotistical empire builder, I might say, Mr. Chairman.

MR. CHAIRMAN: Order, please! I would ask the Hon. Member to withdraw that remark, please.

MR. PHILLIPS: Yes, I'll withdraw that.

The Minister wants to create for himself a dynasty. He's going to use short-term, short-sighted policies at present to build up a power base which in the long run will weaken the forest industry in British Columbia, weaken an industry that was one of the best-run industries in the Province of British Columbia or in North America.

This Minister, unless he can answer the questions, unless he can answer the accusations that have been made against him of wrongdoing, unless he can come clean to this Legislature, should resign. He should resign forthwith.

HON. MR. WILLIAMS: Well, it's very difficult to take the kind of nonsensical, "Alice In Wonderland" diatribe that we've just listened to since 2:30 this afternoon. An hour and a half of nonsense while the back bench Socred wandered through a catalogue of

[ Page 2941 ]

boards of directors that confuses him to no end. I'm not surprised that that's the case.

I think the Hon. Leader of the Opposition (Mr. Bennett) can hardly ignore the kind of statements that have been made by the backbench Member this afternoon because they're indelibly involved, the two of them, in these kinds of wide-ranging, nonsense accusations that have come to be part of the pattern of the small band that used to the the Government of British Columbia.

You talk about the board of directors established by this government with respect to Canadian Cellulose. You express concern that they should be people who know something about the business, concern that they should know something about marketing, for example. Shocking idea.

[Mr. G.H. Anderson in the chair.]

Imagine having a person on the board of directors of Canadian Cellulose who is familiar with international marketing in pulp and paper. It's a precedent setter in terms of what the old government might have done, I admit, but in ordinary circumstances and in circles of decent citizens I'm sure it makes a great deal of sense.

I see too that the Member is also shocked that we should have somebody from Kansas — good heavens! — who is the president of the largest envelope manufacturing organization, in the United States. And a Republican to boot! Good heavens! Imagine having somebody on your board of directors who might be able to advise you with respect to subsequent steps to make more use of labour in the province and to go into fine paper processing in British Columbia, to make better use of our resources, to provide more jobs for our people.

Imagine bringing people from around the world! Imagine bringing the best people and the best minds in the world to British Columbia to work on our company — one that we own 79 per cent of. Shocking idea! Imagine, when you own a company that was part of the conglomerate you acquired that is based in Belgium, that you might actually involve a Belgian banker. Shocking idea! Imagine having someone informed about problems in Belgium and the whole process of fine paper production within the Common Market, in the capital of the Common Market. Imagine, little British Columbia having access to the Common Market with its 50 per cent owned company or 50 per cent own company in Belgium.

MR. PHILLIPS: Who owns the other 50 per cent?

HON. R.A. WILLIAMS: Who owns the other 50 per cent? A group of individuals in Belgium; no single company.

You wander around through boards of directors.

Maybe we should look at some of the private-sector directors since you've got on this trip, Mr. Member. Let's look at some of the private companies in the province since you're so disturbed.

Maybe we should look at B.C. Forest Products. I wonder if they have anybody on their board of directors from outside British Columbia. After all, it is named British Columbia Forest Products Ltd. I wonder. Why, look at the list of names. There's a man by the name of Paul Clay Baldwin of 1300 South Leopard Road, Irwin, Pennsylvania. Good heavens! Somebody from New England on the BCFP board of directors. Here's another one: Charles Denston Dickie, Jr. — two generations — 649 Dorset Road, Devon — no, not England — Pennsylvania. Imagine!

Here's another one: James Wilmer McSwinney, 2300 Ridgeway Road, Dayton, Ohio, on the board of directors of British Columbia Forest Products.

Here's another one: Harry Talbot Mead, 650 West David Road, Dayton, Ohio, also on BCFP.

Here's another one: George Hinkle, 60 Harmon Terrace, Dayton, Ohio — three gentlemen from Dayton, Ohio, on the board of Directors of British Columbia Forest Products.

I'm sure that the Member is shocked that BCFP finds it worthwhile and necessary to go abroad and bring people to British Columbia to help them in correcting the affairs of this British Columbia company. It's a shocking idea.

Maybe we should also look at Rayonier. The Hon. Leader of the Opposition (Mr. Bennett) would seem to champion Rayonier, because they wanted to expand in the north and we wouldn't let them. Let's look at Rayonier — the friendly little Rayonier Company, IT&T, the sovereign state of IT&T and all that. What about Rayonier? What about their board of directors, super-sleuths over there?

Here we are: Charles Eldon Anderson, 181 Chestnut Hill Road, Wilton, Connecticut. Imagine!

Here's another one. Robert Allan Buddington, 55 Tolmie Avenue, Old Greenwich — not England, but Connecticut.

Here's another one. John Ronald Goode — spelled just like the Liberal mayor in Delta. Muse on that. Where does he live, in this Alice-in-Wonderland debate we've been provided by the opposition? Why, he lives at 16 — get this now — he lives at 16 Cottontail Road, Greenwich, Connecticut.

Here's another one — Glanton Windship Haskell, 124 Thayer Pond Road, New Canaan, Connecticut.

Imagine! Rayonier finds it worthwhile to have those kinds of people on their board of directors....

MR. PHILLIPS: Are you going to table the documents?

HON. R.A. WILLIAMS: That's the board of directors of Rayonier, Mr. Chairman, the board of

[ Page 2942 ]

directors of British Columbia Forest Products. There you are — those secret directors in the United States, secret directors from abroad who seem to shock the opposition. Imagine bringing talented people to bear on a company that was mismanaged by absentee owners in New York consistently.

I just have to listen to the kind of debate I've listened to this afternoon and earlier to convince myself that if we are to preserve decent management and sound and good management in these companies, we have to make sure that the good, professional management of these companies is not subject to your brand of witch-hunting games-playing that we've seen in the last two days.

Interjections.

MR. CHAIRMAN: Order, please!

HON. R.A. WILLIAMS: We heard some interesting points yesterday, Mr. Chairman, about the question of the price paid for newsprint. It was a long harangue about newspaper prices that I'm sure that somebody in the industry, no doubt, courteously provided for the Hon. Leader of the Opposition (Mr. Bennett).

There's been speculation, if you'll forgive the term, in the industry and in the political world. People have been wondering for the last several days what Robert Bonner was going to do. I think we might just now have a clue. The speech material provided the Hon. Leader of the Opposition just might have that kind of imprint. I wonder. Maybe he's been put to work at last helping the leader of Her Majesty's Loyal Opposition.

But maybe we should look at the price paid across Canada at mills for newsprint. What is the f.o.b. price at the big mills in Canada? What kind of price is paid?

MR. PHILLIPS: Table the documents!

HON. R.A. WILLIAMS: What kind of price is paid at MacMillan Bloedel? What kind of price is paid Arbitibion the east coast? What kind of price is paid British Columbia Forest Products?

MR. PHILLIPS: Table the documents! Tell us we're wrong!

HON. R.A. WILLIAMS: What kind of price in U.S. dollars per ton?

Interjections.

MR. CHAIRMAN: Order, please! Let us have some order.

HON. R.A. WILLIAMS: The kind of price that is being paid, Mr. Chairman, is in the $170 and $175 a ton, range for the major Canadian producers of newsprint at the mill. That's the kind of price.

MR. PHILLIPS: Table the documents! That's all we ask!

HON. R.A. WILLIAMS: The amount that Ocean Falls originally received from the Crown Zellerbach Corporation under their initial contract was $146.02 mill net. At the time of the ending of the arrangement with Crown Zellerbach the mill net that was paid was $148.40.

Interjection.

HON. R.A. WILLIAMS: We cancelled it because we didn't think it was as good an agreement as we might have.

We now have an agreement with CNC that has been renegotiated in the past month, and improved considerably. We also have a contract with the Crown corporation in Mexico, Pipsa, which is the Crown buying agent for all paper in Mexico, that is also considerably above market in this region. We are satisfied that the market price that we are receiving is certainly, in the Mexican instance, satisfactory. We think that there can still be some improvements with respect to CNC, and there are some discussions being pursued subsequent to the latest improvements.

I should make it clear that we do have a secure market so that if there is a fluctuation in the world pulp market and it declines, we still will receive a good price above market on the west coast — considerably above market on the west coast.

The Hon. Leader of the Opposition suggested we were talking in terms of a fixed price. We are not. The contract is not a fixed price contract. It floats and relates to markets and it is, in fact, above market.

MR. PHILLIPS: Table it!

HON. R.A. WILLIAMS: I think that no private company tables the various documents.

SOME HON. MEMBERS: Oh, oh!

HON. R.A. WILLIAMS: These companies that we hold must have the freedom to move in the international markets of the world like the private sector companies. There's nothing that that little group over there — that failing opposition — would like better than to see these companies fail, and the more they can feed them and thrash around in the straw, the more they think the chances of failure are.

MR. BENNETT: If the people own that company why don't you tell them how the people's business is

[ Page 2943 ]

done?

HON. R.A. WILLIAMS: That's right. We'll file the annual report shortly.

MR. BENNETT: Will the documents be in it?

HON. R.A. WILLIAMS: The annual report will be filed shortly. It is interesting to hear the Hon. Leader of the Opposition talk about fixed price contracts. Now, he should be upset about them. His dad should have learned something about fixed price deals because he went into more, than one of them.

Now we talked about Wenner-Gren. We had to blow $10 million to buy us out of that mess; to get back our own river and our own Rocky Mountain trench. But he was involved in an even grander one, and it is known as the. Columbia River Treaty. No wonder the Leader of the Opposition is upset about fixed price deals, because we got the worst fixed price deal in history under the Columbia River Treaty. The latest figures indicate that we are short $137 million on the Columbia Treaty.

AN HON. MEMBER: Big daddy!

HON. R.A. WILLIAMS: Big daddy blew that one, I'll tell you. Big daddy blew that one.

What did he say at the time of his election campaign? He said, "Nothing is freer than free, my friends." That's $137 million short. Even worse than that.... I guess a guy can make a mistake....

Interjection.

HON. R.A. WILLIAMS: Maybe you should develop that in your speech.

That's $137 million dollars short. Well, you know, I guess a guy can make one mistake, but he had to make a grander one. He had to sell the energy for 30 years. The downstream benefits on our rivers had to be sold for 30 years; until the year 2002 we sell the energy of the Columbia on a fixed-price deal. A. fixed-price deal! And what sort of price? Why, 5 mills. That's 5-mill power until the next century by the financial wizard, Daddy.

AN HON. MEMBER: Who's ripping who off?

HON. R.A. WILLIAMS: The financial wizard of 20 years! He was the Wizard of, Oz. He made a fixed-price deal unequalled in this nation where we've made mistakes in dealing with our neighbours to the south many times — 5-mill power.

How much is it going to cost us for power in the Columbia area now for ourselves? We're presently involved in a major project in the Columbia system. It's on the Kootenay River between Nelson and Castlegar, that marvellous, beautiful, short stretch of river that has, considerable fall between Nelson and Castlegar.

We're building the Kootenay Canal project, which I think is something like $160 million in costs, to pick up something out of the, Columbia River Treaty disaster. And what is the cost going to be for power on the Kootenay, which in its purest sense used to be one of the cheapest power sources in North America? The price, or mill price for power in the Kootenay Canal project, in the Columbia system will be seven mills — 40 per cent more than that which we sold to the Americans. The Americans got Duncan in 1967, and the downstream benefits in 1967; they got the downstream benefits from Arrow in 1968; and they got the downstream benefits from Mica just last year. And it's five-mill power.

Our system on the Kootenay Canal won't be ready.... The first generator will be 1975, the second in 1976. And we, in just a few short years since the Columbia River Treaty disaster, will be paying 40 per cent more for power — for British Columbians at source — than the Americans are getting until the year 2002.

Just think what the cost of producing power in British Columbia will be in the year 1980; just think, what it might be in 1990; think what it might be in 2002. That's the kind of simplistic view of the world; the fixed price dealing that we got at the hands of the former leader of this government (Hon. Mr. Bennett) for 20 years.

It is just a little thick to listen to the lower rung of the dynasty talking about fixed price deals when we, as people of this province, have to live with one of the worst fixed price deals in the history of Canada. Not only that....

MR. D.M. LEWIS (Shuswap): Don't forget the Skagit.

HON. R.A. WILLIAMS: Not only that, we gave away the flood benefits in the United States under the deal. Not only that, we got $64.4 million in terms of flood benefits — $64.4 million. But the Americans were willing to pay half of what the damages downstream in the United States would have been. In June of 1972 the damages downstream in the United States would have amounted to $213 million. In one year alone we could have got more than we got for it in perpetuity.

You only have to go down to Portland or the tri-city area or any of the towns along the Columbia and look at the development along the river and see that we've made this colossal blunder in British Columbia. While we're helping our neighbours, we did it for nothing — or virtually nothing.

You only have to look at the development of the bridge as you cross the Columbia River going into

[ Page 2944 ]

Portland. See the huge hotels, the townhouse developments right on the riverbank. None of it could have happened without the Columbia River Treaty. That's the kind of fixed price deal that we got from the senior member of the family over there.

MR. H.W. SCHROEDER (Chilliwack): Pretty weak, Bob.

MR. LEWIS: What about the Skagit?

HON. R.A. WILLIAMS: We lose our sovereignty forever over the Columbia basin and you're willing to stand up and support it. Well, help yourself. Well, help yourself. It's just amazing.

What about the Skagit?

Interjection.

HON. R.A. WILLIAMS: Oh, water resources, I think, is part of the department.

What about the Skagit? For $34,000 a year the financial genii over there were prepared to give it away at $34,000 a year. Peaking power in Seattle — $34,000 a year...and as recently as 1967.

MR. BENNETT: What kind of power in Seattle?

HON. R.A. WILLIAMS: Peaking power, yes, incredible! Absolutely incredible! A fixed price deal as they saw it in perpetuity: that's the kind of fixed price deal that you were prepared to put as a permanent burden on the people of British Columbia.

MR. LEWIS: Social Credit know-how.

HON. R.A. WILLIAMS: And I ask, Mr. Chairman, because it's not very clear to me: just what does this group really stand for? What kind of British Columbia do they really want?

They object to the acquisition by the people of the province of Plateau Sawmills — with the minority shareholding group some 3 per cent, the Mennonite group in Vanderhoof. Is the Leader of the Opposition saying that he prefers IT&T, that he prefers the expansion of IT&T?

Well, the history of the former government was of a rubber stamp one. You rubber-stamped every proposal of the forest industry. Not one trade proposal was ever stopped under the former Minister or the former Premier. The pattern was established firmly: what the multi-nationals want the multi-nationals get. That was the system under Social Credit. Are you saying that you want IT&T with their record of intrigue?

Interjection.

HON. R.A. WILLIAMS: The Mennonite people were free to choose the buyer. The interesting thing is that they're free to make their choices; they are free to be involved with the government or sell their 3 per cent or whatever they like. But they choose to remain involved. So we have a partnership with these people and they're involved on the board of directors.

Now I don't think they have ever had a happier situation in Vanderhoof or on that board of directors as they presently have. There was controversy because of the American owners in the past. The Mormon group that were the owners in Plateau caused considerable frustration in the community with respect to the Mennonite owners. That problem has now been resolved, and the minority group in Vanderhoof is obviously pleased and anxious to have this Minister back in Vanderhoof working with them.

I look forward to going there and actually working in Vanderhoof for a short period this summer at the mill in Engen and with the people there so that I can get a better feeling for the problems of that community, just as I did with respect to Terrace. I see that as the obligation of a cabinet Minister in a government such as this.

So I look forward to working even more closely with the people that are obviously enjoying the new majority owner more than they ever had with former owners in the past.

Is the Leader of the Opposition saying he would have turned his back on the return of nine million acres, as we got in Columbia Cellulose? Is he saying he wouldn't want the 50,000 acres of prime recreation land, shoreline land, fish-spawning land, magnificent waterfrontage land in the lovely valley of the Kootenay? What does he stand for?

He stands for an extension of the mistakes of the past. What we're being offered is a pale carbon copy of the man of the past 20 years — a pale carbon copy that would extend the kind of multi-national control and limited control by government that we had for too long. That's what he's offering.

I challenge the Leader of the Opposition to tell us today what he stands for in relation to the patterns of the past that the former leader of the former government brought forth. Clearly we're getting just a poor imitation, a poor repeat of 20 years that was dismissed by the electorate only a couple of years ago and I'm sure will be dismissed again.

AN HON. MEMBER: Billy boy can't stand the heat.

MR. P.L. McGEER (Vancouver–Point Grey): Mr. Chairman, the Minister of Lands and Forests gave an interesting account of the mistakes of the past. He knows them well. I know them, and I agree with what he says. There is little doubt in my view that the Columbia River treaty will go down as Canada's

[ Page 2945 ]

greatest disaster. I intend to say more in the debate on the Minister's estimates about that Columbia River deal.

We have to move to retrieve it. There are ways. I have suggested these ways to the Minister of Lands and Forests. He has been developing background material; there have been discussions with the Prime Minister. He's still the Prime Minister; perhaps there'll be a new Prime Minister. If there is a new Prime Minister, then we should enter into discussions with him.

MR. WALLACE: No doubt about it.

MR. McGEER: Well, perhaps the Member for Oak Bay is going to run federally. If he does, I wish him well.

MR. WALLACE: Not a chance, not a chance.

MR. McGEER: I think he might be able to make a contribution to the House of Commons.

But we're dealing with the here and now. We're dealing with legitimate problems that the present Leader of the Opposition raised in what I thought was a well-documented case. It may be that the Minister of Lands and Forests has adequate answers for the questions that were asked. But if he does, he did not give them. He merely catalogued the disgraceful errors of Social Credit in the past. I don't disagree with him about those errors.

But Mr. Chairman, I do say this: if the Minister has placed the people of British Columbia, through a contract he has negotiated with an international broker, through a Crown corporation that now belongs to the people, of selling newsprint at black market prices, then this practice must be terminated immediately or that Minister must resign. We cannot be placed in a position in British Columbia or seem to be placed in a position where our newsprint for temporary expediency is being black marketed around the world. We must see that agreement. You must make it clear to the broker that you deal with that any contract you negotiate with him is for the people of British Columbia to see, and not a cozy little deal between you and that man. Never. We're going to operate these Crown corporations in British Columbia in a completely ethical and satisfactory manner or we're going to see the Minister out of office or a government out of office.

It isn't good enough to run a Crown corporation according to the looser standards by which international brokers operate. If he's clean and if you're clean, there's no reason why that document cannot be tabled for everyone to see. You've completely evaded this issue by suggesting that there was some advantage to holding these negotiations confidential on a contract. What advantage is there to anyone but to you yourself? There's no advantage to the people of British Columbia. No long-term reputation can be built up for yourself, your government or for that Crown corporation. Anything you do behind the closed door with an international broker you have to be prepared to lay on the table before this Legislative Assembly and the people of British Columbia.

We don't want any more of the phony annual reports we used to get under Social Credit. What responsible legislator is going to be satisfied with an answer from a Minister that merely says, "We will file with you an annual report." That's what we used to get from W.A.C. Bennett and Einar Gunderson, and it wasn't good enough. That Member knew when he was in opposition that it wasn't good enough. Not for the people — but it turns out to be good enough for him when he's a Minister. That, Mr. Chairman, is a double standard.

What is it that the Minister is trying to hide? What profits have come to the people of Ocean Falls and the public of British Columbia versus the profit that has gone to Ira Wallach? Has he got 90 per cent of the cream out of this and has the public of British Columbia got the 10 per cent skim milk? Wasn't that what happened on the Columbia? Wasn't that what happened on the Skagit? And didn't it all start for the same reason? The government wanted to keep its deals with others under the table. That was the basic fault under Social Credit, but that basic fault hasn't changed one tiny little bit under the New Democratic Party — not one bit.

You're very good at seeing the errors in others. Let us face it, Mr. Chairman: anyone who is in power and must make judgments will make errors. Sure, the Minister of Lands and Forests will make mistakes; the Premier will make mistakes.

AN HON. MEMBER: No, no.

MR. McGEER: No, no. Even the Minister of Labour may make mistakes. But the public will forgive that. What they will not forgive is coverup. And rightly so.

We do not excuse Social Credit for its past errors. We certainly would not want to apologize for the former Premier and his mistakes and his methods. Yes, the former Liberals too, says the Leader of the Opposition (Mr. Bennett). I agree with that; they made plenty of them. I certainly agree with the analysis that the Minister of Lands and Forests made about those deals. If he were to say the same things about the Liberals — and he had occasion — I'd agree with that too.

But to use that as an excuse for doing the very same thing — perhaps worse; we don't know yet.... We know the Minister is not prepared to lay the cards on the table; he is not prepared to face public

[ Page 2946 ]

scrutiny on the actions he has taken. Let's keep it down to one single issue, the Ocean Falls deal.

We want to talk about other things: what he's done on Can-Cel; what he hasn't done on the Columbia; what he hasn't done on the Skagit; what he hasn't done on the Ponderay; what he intends to do on the University Endowment Lands. But these are matters of judgment, and compared with the central issue on which this non-confidence motion is based, it shrinks in significance because it appears as though the Minister has been caught out in signing a secret contract with an international broker whose methods must be .questioned.

He refuses to give details to this House about what he has done on that contract, and refuses for unsatisfactory reasons to table that, document in the. House. Unless the Minister is prepared to table the contract and make a clean breast of what he has done, we intend to support the amendment.

MR. CUMMINGS: They told me that you should answer fluff with fluff, a crock of.... What was it? The vanilla ice cream with the crock of something else.... But the worst bang I've ever heard came from the First Member for Vancouver–Point Grey (Mr. McGeer). A real big bang.

According to him, he feels that our corporation in Ocean Falls should reveal all their contracts and all their business dealings. How come in the Income Tax Act all dealings of the international companies who compete with our little tiny corporations aren't revealed? It's because it would give any competitor one terrific advantage on this poor little company.

MR. BENNETT: Nonsense!

MR. CUMMINGS: Stick to hardware. After all, your daddy gave you a hardware store and now he wants to give you a province.

MR. BENNETT: Nonsense! You don't even understand the newsprint market.

MR; CUMMINGS: Tell me how you made your first dollar. Tell me, did Daddy give it to you? Come on, now — Daddy will give you everything you want.

Interjections.

MR. CUMMINGS: With my luck I might make it. Hey, they have all deserted him — oh no, here comes one.

MR. CHAIRMAN: Would the Hon. Member relate his remarks to the motion? .

MR. CUMMINGS: Let's get back to the facts. The facts are that what they are asking of Ocean Falls is ridiculous. As the First Member for Vancouver–Point Grey. often does, he is asking our company to expose itself for what it is.

AN HON. MEMBER: That's right. Gyp artists.

MR. G.S. WALLACE (Oak Bay): Mr. Chairman, at this point in the debate I plan to stick to the issue which was put forward by the opposition. as the reason, for a motion to reduce the Minister's salary by I would like to quote at he outset from Hansard in the question period on October 15, 1973. I am not quoting from the Blues, Mr. Chairman. This is a question that I asked in the question period on October 15, 1973.

MR. WALLACE: I noticed that the newsprint sales contract between Ocean Falls and Crown Zellerbach has been, terminated and. that the company which is taking over the contract as of January 1, Gottesman-Central National Organization, has a president by the name of Mr. Wallach, who is a director of Can-Cel. I wonder if the Premier would make any comment as to whether, this director will be resigning in the light of the business contract now set.

If I might interject, Mr. Chairman, I was asking the Premier because the Hon. Minister of Lands, Forests and Water Resources was out of the House on that occasion. The Hon. Mr. Barrett is quoted as replying:

HON. MR. BARRETT: It is correct that it is the same man, but there is. no conflict of interest. The sale of newsprint, of course, is something separate from Can-Gel's products.

The reason for the change in the Wallach contract is that the price is much higher right now. I'm sure that with this move we will be returning even greater funds to the corporation on behalf of the people of British Columbia.

I then asked a supplemental question. I continue to quote:

MR. WALLACE: Just a supplemental question, Mr. Speaker. The Minister concerned declined. to outline the terms of the new agreement. Since this is now public business with the taxpayers' money being involved in Can-Cel, would the Premier care to table the terms of the new agreement with the House?

HON. MR. BARRETT: I will certainly take the question as notice. I would like to speak to the minister.

Mr. Chairman, that really sums up my, position and the position of our party in this House on this issue, We hear a great deal from this government based on their clear philosophy and ideology, which differs from ours, that the economy and the welfare of this, province is better in the hands of the government through a variety of Crown Corporations and other vehicles whereby the state will operate and control

[ Page 2947 ]

parts of the forest industry at the present time, and other industries as well which we all know have been mentioned in this House recently — whether it is alfalfa cubing or poultry processing or various other government involvements in the business of the province. In this case we are talking specifically about a company which the Minister reminds us is 79 per cent owned by the people of this province and which is the pulp business.

I think this is the nub of this particular business — namely, the government's claim that the citizens of British Columbia will receive better management of their resources if they are managed and controlled by government than if they are managed and controlled  by private companies.

My very clear conviction is this: if that is the answer and if the Minister believes in taking more and more public control over the resources, then it is an axiom that the public should know what this Minister and what this government are doing with their money. It is just that simple.

When the Premier answered my question on October 15 that the reason for terminating the deal with Crown Zellerbach and making the deal with the American companies, in his words, was that the price is much higher now, the clear implication is that the deal was changed because the price had improved. But how much had it improved, and to what degree has it improved still further?

I listened this afternoon and made notes here where the Minister said that the price is even better now and that it is above market value for this area of the country. It is not a fixed price. Certainly in the days of inflation and soaring costs any government or businessman these days who made any kind of deal with a fixed price for any length of time has to have his head examined, I would think, I don't even think we have to. go into the merits and demerits of negotiating, in this economic era on a fixed price for any period of time. So I don't think that is the debate.

The issue that I and the party I represent in the House feel is so important is that in an industry of this importance to the province, which brings in so much income and the differing philosophies I mentioned a moment ago that the state can do better than: private enterprise.... We needn't argue that because we, could argue that for the next 20 years probably and that side of the House and this side of the House would agree to disagree.

I think regardless of that different attitude to our philosophy and to the management of the resources of this province, we can differ in that respect, but I don't think we should fail to acknowledge the obligation of government. If it's doing public business and if it's spending and investing taxpayers' money, I can't understand why there should be any hesitation at all for the government and this Minister to just give us the simple facts and figures.

I just add what has been added to many debates in this House: this government, in seeking the confidence of the voters and in putting forward its policy and its ideology, promised the voters open government. The NDP not only said that it could give better government and in particular a more judicious use of our natural resources, but it promised open government.

So, here we have one of the first major moves by this, government into, the area of resource management in competition with the private sector and using taxpayers' money to acquire 79 per cent of a company. There is some doubt on two scores now as to whether or not the government made an adequate deal in the first place, and secondly whether we have suffered internationally by possibly having gained a reputation of dealing with a company which is reselling the pulp at exorbitant prices because of the international shortage.

I'm sure that that would never be the Minister's intention or this government's, intention, because whether we're socialists or conservatives, we're all Canadians. I'm quite sure that it wouldn't be the wish of any single person in this chamber to end up in that situation whereby we're selling pulp at deflated prices which is then resold to countries who are desperate to, get the pulp at any price. But, it may be that that has happened, certainly unintentionally, but by poor administration and poor management through this Minister's department and through his failure in the negotiations which took place in this regard.

So, Mr. Chairman, while there are many other, areas of this Minister's administration which we should discuss, to save the time of the House at this point; I feel that it is a very legitimate criticism of the Minister for the reasons I've outlined, that he should table in the House the details of the original agreement. I'm talking about the details of the original agreement with Crown Zellerbach, the subsequent agreement with Gottesman-Central and the details which he's just talked about generally this afternoon which were re-negotiated. So there's really three sets of simple information and figures.

In the light of the reasons I've given — the open government, the claim that the government can do better than private enterprise — for these fundamental reasons, I support the amendment.

MR. D.F. LOCKSTEAD (Mackenzie): Mr. Chairman, I just wish to go on record as not supporting the present motion before the House. This Minister, in my view, is the best Minister of Lands and Forests this province ever had — no question about that.

While the former government was prepared to let whole communities disintegrate, let thousands of jobs go down the drain and let our resources be sold out

[ Page 2948 ]

of this province completely, this present Minister has reversed that trend and that policy.

Also, for the first time in the history of this province, to my knowledge, this present Minister is listening to environmental groups and other departments of government on environmental matters. All these departments are plugged in. This is a motion of non-confidence, Mr. Member. As I said, in no possible way can I, or I think the people of this province, support such a motion.

I want to talk about one other matter very briefly, Mr. Chairman, and that is the matter of Ocean Falls. A lot has been said in this House in the last day or two on this matter, and I expect to be speaking on this in more detail later under this estimate. I think the Minister made it quite clear earlier that the Members of the opposition do not want that Crown corporation to work, for no other reason than that they believe that if these Crown corporations don't work it will be sort of a black eye for us. I'd like to tell you and this House now, Mr. Chairman, that while we may have some interim problems at Ocean Falls — we admit that and we have said so — they are in the process of being solved. In the long view, I am fully convinced that Ocean Falls will probably be one of the brightest communities on this coast.

MR. H.W. SCHROEDER (Chilliwack): I'd like to speak just briefly on the amendment and support it. The reason why I have to support this is not only because it was sponsored by this party on this side of the House, but because as we study the remarks of the Minister and the pattern established by this Minister over the past 18 months, we see a complete reversal of stated policy when he went to the people for a mandate.

I remember in the fall of 1972, the members of the NDP coming to the people for support. They didn't believe they had sufficient support to form a government, so they could be a little reckless in their statements.

In their statements they came out long and hard and strong, I might add, against multi-national corporations. They cited the oil companies. They cited the forest industries and made statements which would have the people believe that our resources — whether they be energy resources, whether they be forest resources or whether they be water resources — were going out of the province and leaving nothing behind, using the words "royalties" and saying that the former government was giving the natural resources of this province away.

They cited the chief demon in this regard as in the multi-national corporations, saying that they wouldn't want to have anything to do with them, saying that they should be banned from the scene, saying that they resembled too closely monopolies (which word should never be spoken in British Columbia), saying that they were part of big business which was robbing the little guy out on the street and not giving a fair distribution of buying power to all of the residents of British Columbia.

They made snarky remarks about people belonging to a Vancouver Club, saying that the destiny of our resources was determined perhaps over a martini and that the real control was not out there where the rubber meets the road, but in here somewhere a few people, usually representing multi-national corporations, get together and determine what's going to be happening to the resources which we all admit belong to the people of British Columbia.

What has happened in a few short months since this Minister has taken his portfolio? All of a sudden the weight of responsibility has weighed heavy and it has bent him over — as a matter of fact, bent him so far that he has done a complete flip-flop as regards his position regarding multi-national corporations. All of a sudden not only is he not against multi-national corporations, but he wants to become a part of them. Not only does he create a part of them in his own portfolio, but he strongly supports the creation of monopolies within the province.

Now, it sounds to me like this is a double standard. I think I've heard it charitably reported among some of the other Members of the opposition that it could be called a double standard. I think those less charitable would call it hypocrisy. I think that perhaps those of us who would put charity aside and just call it like it is would call it misleading, but I think that the people who are out in the province call it what it really is, and that is dishonesty.

I don't see how this Minister can become involved in something to which he was diametrically opposed just as short a time as 18 months ago. Now if he is knowingly involved in this thing, the whole act becomes villainous or preposterous and if he is unknowingly involved, then the man is dangerous.

In either instance, I believe that his salary needs to be questioned here today and not only do I agree that his salary should be reduced by $1, but Mr. Chairman, if we were going to tell it like it really is, this man should not receive salary at all because he has changed completely his position.

He's been called the super Minister, the super Minister, and I think when you talk of him in the circles of the backbench of the NDP Party, he might be the super Minister. I think even on the treasury benches they regard him highly, because he helps to shape the financial destiny, undoubtedly has a great deal of influence upon the Premier of this province, gives the Premier of this province some decisions which the Premier himself cannot refuse. He's called the super Minister.

The people out in the constituencies have a regard for him. But regard there is spelled f-e-a-r. They have a fear of him, because he has a tendency to be closed

[ Page 2949 ]

mouthed, closed minded and the opposite to what we believe would be open government.

He answers no questions in this House, he files few documents in this House, he acts as the secret super Minister and as a result is the instigator of fear in the province. Fear to the extent that people who are dependent upon the Ministry of Forests for their livelihood and who must come to him for timber leases, tree farm licences, permits to operate, they refuse to say what they really think because they are instilled with fear, believing that the man perhaps could turn on them and cut away from them their very livelihood.

He's called a super Minister. But Mr. Chairman, I have to tell you that in the eyes of the financial world, in the eyes of the business community of the world which goes beyond the Province of British Columbia, this man is no super Minister. He's a super pawn. He's a super pawn because when somebody else moves him to the King's square in the fourth row he moves without question. He has to, because he himself has not the power nor the financial backing and he goes where the players move him. He is the super pawn and I have to remind him that he's playing in a league to which he was not born to play.

AN HON. MEMBER: Oh, oh!

MR. SCHROEDER: He's playing in a league....

AN HON. MEMBER: You don't even know what you're saying.

MR. SCHROEDER: Yep, sure do. He pretends to be a part of the great international business community. But I want you to know, Mr. Minister through you Mr. Chairman, you were born under the wrong star. You were born under the wrong star to play in that league.

When they're all finished with you, after they've moved you as far as the opposing Queen's row, they'll kick you aside like they do a fingernail that's too long. They'll kick you aside and they'll say to you, "sorry fella, you belong to the wrong sect. You belong to the wrong community." Because in the international business community, you have to have a name like Wallach, you have to have a name like Berkowitz, you have to have a name like Litvine.

HON. R.A. WILLIAMS: You are sick, you are sick.

MR. SCHROEDER: You have to have a name like Gross. These are the boys who are the pawn movers — the pawnbrokers...

AN HON. MEMBER: You're sick, you're sick.

HON. R.A. WILLIAMS: You know what you're saying? You know what you're saying?

MR. SCHROEDER: ...and as a result, as a result you won't stay my friend, you won't stay. Mark it down.

HON. R.A. WILLIAMS: Anti-seminist speech. Never heard the like of it! Never heard the like of it!

MR. SCHROEDER: I want the Minister to withdraw those remarks. Absolutely. He called me an anti-Semitism and I'll have him remove those remarks.

AN HON. MEMBER: He was on your side.

MR. SCHROEDER: I never said anything of the sort. Never said anything of the sort. Mr. Chairman, will you have him withdraw?

MR. KELLY: You inferred that, you sure did.

MR. SCHROEDER: Never said anything like it.

HON. R.A. WILLIAMS: It's evil stuff no matter how you slice it.

MR. CHAIRMAN: On the advice of my learned friend I would ask the Minister to please withdraw that remark of anti-Semite.

HON. R.A. WILLIAMS: Well, I think the record is clear and will be there in Hansard for all to see and on that basis I withdraw, Mr. Chairman. I think the record is abundantly clear Mr. Member.

MR. CHAIRMAN: Would the Hon. Member please continue?

MR. SCHROEDER: Thank you, thank you.

MR. CHABOT: On a point of order. Would you have that Minister withdraw that statement without the qualifications he attached to it?

AN HON. MEMBER: There's no qualifications. He said it.

AN HON. MEMBER: Do you want to stop Hansard?

MR. CHAIRMAN: I have to rule that the...

AN HON. MEMBER: Take the meringue out of your ears!

MR. CHAIRMAN: ...remark the Minister made was withdrawn to the Chair's satisfaction. Will the Hon. Member please continue?

MR. CHABOT: The Chair's satisfaction? Well, the

[ Page 2950 ]

Chair's being unfair, Mr. Chairman. I'll tell you that right now. It's about time if you're going to sit in that position that you be fair or at least display fairness.

MR. CHAIRMAN: Will the Hon. Member please continue?

MR. CHABOT: We have a political chairman in the chair.

MR. CHAIRMAN: I would have to ask the Hon. Member to withdraw that remark. The Hon. Member for Columbia River. That we have a political chairman in the chair.

MR. CHABOT: Well, Mr. Chairman, if it offends you that I have suggested that you're a political chairman, even though you'll never convince me in my mind that you're not, I'll withdraw.

MR. CHAIRMAN: Thank you very much. Will the Member for Chilliwack please continue?

MR. SCHROEDER: I want to thank the Minister for his unqualified withdrawal because certainly there's not intent in this regard.

I was amazed to find that the Minister's only defence in the charges that have been laid to his department in the short time that his estimates and this amendment have been under discussion, his only defence was one of pointing the finger at some other object, reminding me very, very much of the child still in his mother's arms but already old enough to be aware. When you speak to the child and try to address him, he points quickly to some other object in the room. It seemed to me to be a very, very, very, weak defence.

I'm not saying, that the object to which he pointed was not one worthy of having been cited, nor would I say that I would defend the position taken by the former government as regards the incident that he cited. But nonetheless it seemed to me that to take up 25 minutes of a retort in which he was given full opportunity to defend his position in his department and point only at some misgiving or some failure of some government in bygone days, is only a smoke screen and only indicates the same juvenile attitude that is suggested by the child I mentioned in the illustration.

It seems to me that to have no answer and to have no defence or to change horses in the middle of the stream is certainly not satisfactory and as a result it just helps to cement my attitude to the fact that this Minister's salary must be reduced by $1.

He gave a very interesting little speech on constant price contracts. Fixed pricing he called it. But I want you to know that in the operation of Can-Cel, in order for people who are operating private forest industry concerns, in order for them to gain a timber lease, a condition of that timber lease is that they will supply pulp chips to Can-Cel for a fixed price, a fixed price. The price is $35 a cunit regardless of what the price may be on the market and regardless of whether that individual could be transporting those chips in the opposite direction and gain immediately $3 a cunit extra.

Nonetheless, this Minister who says he does not believe in fixed. Pricing, conducts fixed pricing in his own department. Then he talks about a $12 million profit that that Can-Cel operation is supposed to have gained in its first report.

Was there a $12, million profit? Or is this another time when the Minister has flip-flopped? Is this another time when he has changed his direction? Is the $12 million, a real profit, or is the $12 million an imaginary profit? Is this $12 million a profit as a return to the people in addition to what it would ordinarily have been? Or is this a $12 million profit after the deletion of certain charges that Can-Cel does not have to pay? Let's look at the facts.

HON. R.A. WILLIAMS: Read the annual report.

MR. SCHROEDER: Let's look at the facts. Stumpage is being paid at $22.75 a unit by people in the private industry who are cutting timber as neighbours to those who are providing it for Can-Cel: However, Can-Cel, operating on a tree farm licence, pays the dollar equivalent of $1.90 for. the same unit of chips. As a result he shows a $12 million profit. He would like the House to believe that the province has realized a $12 million that they wouldn't have realized under private enterprise. But the facts are that if they had been levied the same stumpage fee as other private industries in the, same area, not only would there not have been a $12 million profit, but there would have been a $13 million loss.

HON. R.A. WILLIAMS: You don't know what you are talking about.

MR. SCHROEDER: Have you changed your mind again? He's talking about $19 million which he anticipates as a profit, and that this profit is going to be returned to the coffers of British Columbia, that it is going to come to the people. Let me ask you — what people? The minute after you said that you are expecting a $19 million profit you say that you are going to take the $19 million and reinvest it in the programme.

You suggested that you perhaps might use part of it to make working conditions a little better. You are going to take the $19 million and rather than return it to the people, rather than return it to general revenue, you're going to reinvest it in the same company which has yielded that supposed profit,

[ Page 2951 ]

which has already bilked the people by the same number of dollars by virtue of the fact that no stumpage was paid on the cutting.

SOME HON. MEMBERS: Oh, oh!

MR. SCHROEDER: As a result there is a double loss. Is the $19 million going to be given to the people? The answer is no. The truth is that it is going to be reinvested just like it would have been reinvested if it was a private company. Let me ask you one question: who has got any benefit from the $19 million that they would not have got before?

HON. R.A. WILLIAMS: I dare you to take an I.Q. test.

[Mr. Dent in the chair]

MR. SCHROEDER: I'll match yours any day, I'll tell you.

No, I'm afraid that the judgments that have been made by the web which some of the other Members have already referred to have forced this Minister to take the position that he has now taken. Whereas he was at one time diametrically opposed to the concept of multi-national corporations, today he finds himself hopelessly tied into a web of a multi-national corporation such as British Columbia has not seen heretofore.

The B.C. government, with a $2.17. billion budget, becomes. an owner of B.C. Cellulose and creates out of it a Crown corporation. The reason why they have a Crown corporation between it and Can-Cel is so that Can-Cel can be termed a private company and, as a result, fade out of the scrutiny of this chamber. For that reason the Minister refuses to file in this House documents that have been requested, not only with regard to Can-Cel but also with regard to Ocean Falls.

Here we are, B.C. Cellulose; 100 per cent owned by the B.C. government. He says it costs the people nothing, and yet somewhere, somehow, there had to be $70 million come from somewhere, either by loan, or by grant, or by agreement — $70 million had to come from somewhere to create B.C. Cellulose and, as a result, Can-Cel.

When they took over Can-Cel, at the helm of Can-Cel or Col-Cel, as it was then called — was a man by the name of George Scrimshaw, and George Scrimshaw was no dummy. He had received an agreement to collect commission for the sale of this corporation, Col-Cel, and when it was purchased by the government he had to forgo that commission because commissions are not paid when a Crown corporation is involved.

Now then, Mr. George Scrimshaw, having been promised a commission on the sale of a $70 million corporation, do you mean to tell me that he has just automatically moved down to Scottsdale, Arizona, and he just put the buckle on his wallet and said, "Well, that's fine — anything for the people of British Columbia"? The answer is no. Someone, somewhere, had to come to a satisfactory agreement with Mr. Scrimshaw as regards to the sale of Col-Cel. My question is: what was that agreement? This Minister should be able to tell us.

HON. R.A. WILLIAMS: He wasn't even in their employ. You're mixed up. You're sick!

MR. SCHROEDER: All he was was the chairman. Let's tell the truth.

MR. CHAIRMAN: I would appeal to Hon. Members to treat each other with the degree of courtesy required by parliamentary rules.

MR. SCHROEDER: Now, we've already got three different entities in the corporation run supposedly by the people of British Columbia. The truth is the people have no more say in this entire affair than they did before. The only person who has any power in this entire structure is the Minister, and those, whom he wishes to appoint as directors alongside of him.

Who did he decide to appoint as directors? We've had it rehearsed for us long and loud in this House. He has taken as principals, primary directors, those with influence. He has taken four from abroad. He's suggested in this House this afternoon that he took them because of their expertise. I wonder whether he didn't take them because there was no choice in the matter.

What about the pressure applied by George Scrimshaw? Was a part of his fading out of existence, sort of stepping out of the picture, the deal that Mr. Wallach had to be appointed to, the directorship of the new corporation?

I'm wondering about the $70 million that had to come from nowhere to create B.C. Cellulose. I'm wondering whether the money for this didn't come to British Columbia from foreign sources, and I'm wondering whether or not it didn't have to come from Belgium, because one of the boys who was appointed as a director of this company happens to be tied in very tightly with the financial structure over in the mutterland.

HON. R.A. WILLIAMS: From where?

MR. SCHROEDER: You didn't get that, did you? Check your IQ, my friend.

Not only that, we have now three entities. We have now Haseldonckx of Brussels, a paper distributor. We have also Les Papeteries de Gastouche, another paper distributor, also of foreign

[ Page 2952 ]

extraction.

Because of a regulation passed in this House called the Companies Act, he had to make the majority, 50 per cent plus, of the directors of this company Canadian — at least Canadian residents. This is why we have the five people appointed as directors of this corporation who have very little influence in the entire structure. We have Gross, we have Litvine, we have Wallach and we have Berkley, formerly Berkovitz. Then we have the five who have Canadian connections — Gordon, Spicer, Watson, Purdy and Locke.

It seems to me we also had this fellow Locke's name on a bit of research we did on the buying of Dunhill shares. It seems to me that the web we saw being woven by the Member from South Peace River (Mr. Phillips) is moving not only in the areas of pulp and paper but is taking in other industries in this same province.

As we look at the research, do we have a multi-national corporation in which this government is involved or to which it was opposed. Just a few short months ago? One, two, three, four, five, six, seven, eight — eight different corporations woven together beautifully by Champion International Corp. and by the B.C. government, who soon will add to the web not only Ocean Falls, which has already fallen, but also Plateau Sawmills and Kootenay Forest Products and now the other forest products in the Kootenays of which, by the way, the sales representative is Gottesman, the same outfit that is the sales representative for Can-Cel. All ties together very, very beautifully.

I want to ask if this Minister is opposed to multi-national corporations. The answer is no. Did this Minister, when he went for a mandate to the people of British Columbia, say he was against multi-national corporations? The answer is yes. Is there a flip-flop? The answer is yes.

I suggest to you today that the reason why I am asking for a reduction in this man's salary is because over a period of 18 months he can change his mind entirely. I am wondering if that's the reason why he fails to give us answers in this House to questions.

I wonder if this isn't the reason why he develops a great smokescreen when anybody dares to point a finger at his little domain. I would like to suggest that, before we can place confidence in this Minister, this Minister is going to have to file some documents in this House. He is going to have to answer some questions; he is going to have to bring us open government as he suggested he would bring us when he first came to power.

I'm sorry, Mr. Chairman; I have to support this amendment.

MR. FRASER: Ah, the Minister of defence.

HON. MR. COCKE: Mr. Chairman, the Minister of defence, my foot. This is a non-confidence motion. Mr. Chairman, and of all the non-confidence motions I have ever seen, the person who moved the motion removed himself from this House after he moved that motion because he was so ashamed, I'm sure, with the antics of those two Members of his party who supported the motion.

I don't blame him. I would be desperately ashamed. As a matter of fact, I would say this: the last speech makes me feel like saying, "Forgive him, for he knows not what he does." Obviously.

The performance has been innuendo and despair again. That party across the way that said for 20 years that the NDP couldn't run a popcorn stand suddenly finds all their arguments down the chute. They see real performance occurring; they see the people of this province served properly for the first time.

MR. BENNETT: Who are they serving first?

HON. MR. COCKE: The people of the province. Oh, how those Socreds burn. Oh, don't they burn as they sit in those chairs over there? They think that power is something they should have by heritage. We noticed that today.

AN HON. MEMBER: Hear, hear.

HON. MR. COCKE: Yes, Mr. Chairman, heritage. Born for power! That was the indication of the Member for Chilliwack. This Minister isn't born for running a corporation or a Ministerial office, yet he's doing it awfully well. And that makes them burn.

You see, the problem is, for the first time we have a Minister making deals on behalf of the people of the Province of British Columbia.

Interjection.

HON. MR. COCKE: Here we are. A party of failure over there, indicating they aren't satisfied with the successes of this Minister.

Let's remember that great vacuum cleaner salesman that came to the Province of British Columbia. He was a cleaner, all right; he cleaned us right out. Wenner-Gren. That was that great Electrolux man. He was the best salesman that ever hit this province. And when he came up to that hardware merchant, he smiled and knocked on the door and said, "I have some great ideas for you. That's right. Monorails and all sorts of interesting things." That was big business.

Interjection.

HON. MR. COCKE: He was going to make a mark,

[ Page 2953 ]

Mr. Chairman. He left a mark on this province which this province will never forget. Big business. Yes, that was the big business government. They were in big business, all right.

How about the shock we got from Seattle City Light? Oh, we are still feeling that shock. That was a real electric shock.

The Minister gave the answers, very simple answers. He said we are getting more than the average by far in this country. But you won't listen to those answers. So I just have to remind you from whence we came in this province so that we can all put things into perspective. That perspective is as follows. We suddenly have success where we had failure. We now have a real thrust forward instead of going backwards. It's a surprise.

When we dammed the Columbia, we also dammed the cash flow north.

MR. BENNETT: The Minister damns himself!

HON. MR. COCKE: We dammed the Columbia and we dammed the cash flow north.

We won't go into the discussions on the forestry deals of the past. We mustn't talk about those forest deals. Let me say this to the Member for Chilliwack over there who was talking about stumpage: Can-Cel pays identically the same for stumpage as any other company pays in the same circumstances. That's right. Any other company under the same circumstances; and who gained those Tree Farm Licences, Mr. Chairman?

It is interesting. Remember Hydro? Wasn't that something? When this government across the way took over Hydro, they were hanging in there like the big, tough government they were. They were taken to court. When this government on this side of the House dealt, we have dealt completely above board. We have saved jobs for people in this country like nobody else.

One other word about Hydro. I remember sitting here on public accounts when we couldn't get 50 cents worth of information — not even a dime's worth.

MR. LEWIS: They walked all over the people.

HON. MR. COCKE: Ridiculous. We have been walked over.

The people of this province are satisfied. And you know why they are satisfied? Because along with what we are doing, we are saving jobs and social needs. People are satisfied because of the fact that they know perfectly well the thrust now is for them.

I am certainly supporting this Minister in every way. I think he is doing fine, thank you. I say thank you to the Minister of Lands, Forests and Water Resources.

MR. R.H. McCLELLAND (Langley): I agree with the Minister of Health. We did get some very simple answers from a very simple Minister to those questions. If the deals are so above board, file the agreements. That's all you need to do to make sure the people of British Columbia know exactly where they stand in relation to all of this.

This isn't the first time in this session that the integrity of this government was up for serious question. Truth in government was a serious question. It is not the first time; and, given the performance of this government, it probably won't be the last time — to our discredit.

This Minister has obviously been blinded to the needs of the people of British Columbia by his grand design, his grand takeover design for this province which has been outlined quite well in the background and point paper he delivered to the NDP convention in 1971.

"All proven reserves currently held privately and not in production should be carefully assessed and taxed on an accelerating scale while they are withheld from production by their present owners.

"The acquisition of privately-owned corporations in the resources fields prior to major resource tax changes would be a mistake because the market price of those companies would be grossly inflated because of the wide range of tax holidays they presently enjoy."

The message is: force down the prices of the companies and then take them over at deflated prices. That's the way that Minister operates and that's the way this government is operating because he is at the helm — he and his pudgy friend, together.

AN HON. MEMBER: Oh, come on now.

MR. McCLELLAND: Together, at the helm of this government.

MR. CHAIRMAN: Order, please. I would ask the Hon. Member to withdraw those words.

MR. McCLELLAND: Which words, Mr. Chairman?

HON. MR. MACDONALD: "Pudgy friends." You know perfectly well what I'm referring to. It's a personal insult, and I think it should be withdrawn in this chamber.

Interjections.

MR. CHAIRMAN: Order, please. Under standing order 40(2) it says: "No Member shall use offensive words against any Member of this House...." et cetera. Now I would ask the Hon. Member....

[ Page 2954 ]

Interjections.

MR. CHAIRMAN: Order, please. It is believed by some Hon. Members that this term is offensive. Therefore, I would ask the Hon. Member to withdraw the remark attributed to the Hon. Premier.

MR. McCLELLAND: All right, Mr. Chairman, I'll accept your ruling and respect it and I'll withdraw the remark.

The Minister also said, as his urgent priorities, that the NDP placed major industries such as pulp, paper, lumber, mining, manufacturing, transportation, communications and finance under public ownership. Under NDP government MacMillan Bloedel and other leading forest companies would have priority in being nationalized — after, of course, the price was forced down by repressive taxation measures.

As the Minister himself said in his background paper to the NDP convention, the Minister and the Member for Mackenzie (Mr. Lockstead). painted some glowing pictures of Ocean Falls about the same time the workers in Ocean Falls are telling tales of being bitter and unhappy. "Bitter and unhappy": those are their words; not ours. The morale of the people at Ocean Falls is sinking day by day.

What's that Minister doing about the union grievances that have been brought up in Ocean Falls about housing, maintenance, shipping costs and safety? Nothing, I suggest, Mr. Chairman.

Has the Minister had any luck in attracting a private enterprise partner to help bail you out of your mess at Ocean Falls? I'd suggest, hardly likely. It's hardly likely that you're going to attract anyone under the kinds of terms that you'll be offering.

Ocean Falls workers are bitter and unhappy in that socialist paradise that has been created by this government.

Mr. Chairman, it's a shame that, newsprint from Ocean Falls was totally committed to other parts of the world on a black market situation. I was talking on the phone this morning to a newspaper man on Vancouver Island who wants to install a press so that he can expand his secondary industry in a growing urban centre of Vancouver Island.

First of all, he had to have a guarantee that he could get some newsprint. He needs 400 tons a year in order to make this press viable. He can't even get a guarantee of one ton a year because there isn't any available; and Ocean Falls is selling all of its market on the black market in the third world to a large degree. They couldn't even guarantee him one ton.

This government is rapidly becoming a joke in the newspaper industry. This particular individual has the backing of the Industrial Development Bank, but he can't get the help of his own government to let him expand a vitally needed secondary industry in this province.

The kind of a deal that we've been locked into with Ocean Falls 'is such a bad deal that the other people in the business say that they can't even produce at that price. It costs them more than the kind of price we've got for Ocean Falls newsprint to even produce the newsprint itself. What kind of a business deal is that, Mr. Chairman?

Now it's very difficult to find out, as has been mentioned here, before, just exactly how much newsprint Ocean Falls is producing. But we do know. the present production has been curtailed according to the Sun of March 19, 1974, at least, because of a lack of rainfall, to 150 or 160 tons a day. "The manager, Mr. Vesak implies that before the water shortage the production was higher, thereby making an, estimate for 1973 of 157 to 200 tons a day seem fairly reasonable."

So we're looking at approximately 51,000 tons for the year 1973.

We've also heard, Mr. Chairman, in the House that most newsprint marketing agencies, most newsprint manufacturers, use a conventional marketing sales contract to get their newsprint on the market. In almost all cases they sell newsprint directly to the consumer under a kind of a self-perpetuating contract. The original contract is usually for a certain term and it continues on a year-to-year basis unless notice is given 12 months before each expiry date.

The standard Canadian newsprint contract gives the newsprint manufacturer the right to raise the price at any time. The consumer can accept the increased price or give notice of cancellation as described and look elsewhere for supply, which, is pretty difficult in this day and age because of the shortage of supply.

The prices are usually expressed in U.S. funds per short ton at the newsprint mill and the price includes the freight to the destination, which is for the account of the seller.

There are four newsprint, manufacturers in British Columbia and, with the exception of the Ocean Falls Corporation, they all market their newsprint direct to consumers in the United States, Latin America and elsewhere in the world — other than Japan and Southeast Asia. These markets have been banded together to export their newsprint under a cooperative arrangement, each being charged on the basis of tonnage only for the cost of providing the marketing service.

There's another market, however, which Ocean Falls has chosen to exploit. It comes into play when it's decided that newsprint will not be sold by the manufacturer either directly to the consumer under a term contract or through a commission agent on a continuing basis. That newsprint finds its way in times of oversupply into what is called the dump market, and in terms of times of short supply on what is accurately called the black market.

[ Page 2955 ]

The obvious time for a newsprint merchant to firm up a fixed-price purchase, contract for a two- or three-year period at the then going prices is just when a world newsprint shortage looms ahead. Under any kind of definition that you choose to use, whether it be the dictionary definition or anything else; it's a black market, pure and simple — nothing less and nothing more.

Interjections.

HON. R.A. WILLIAMS: Outside the cartel?

MR. McCLELLAND: This kind of a purchase that we've got locked into with, Wallach and the Gottesman-Central National Organization is a "heads, you win, tails I lose" proposition as far as the newsprint manufacturer — in this case, the company owned by the people of British Columbia — is concerned.

In a period of newsprint shortage the only sales effort and expense needed is a,telephone call, Mr. Chairman, to sell that product, because the world can't supply enough of the product. All you need to do is pick up your telephone and you'll sell all the product that, you have. You don't need to make rip-off profits available for a New York black marketeer.

HON. MR. STRACHAN: What a bunch! Gee!

MR. McCLELLAND: The black market price has been knocked around in this House. We still don't know what market that Minister is referring to when he says that we are selling newsprint about the going market price. I suggest that it may be above that going price of $213.50. But it sure as the devil isn't above the price which was quoted in Brussels not two weeks ago of $640 a ton for black market newsprint. It sure isn't above that price and it isn't even anywhere close to that price; Mr. Chairman, even though it may have been renegotiated above the $213.50.

As a matter of fact, it may, be renegotiated again to meet those demands because some of those newsprint marketers are now getting $250 a ton on the regular market, and I would expect that perhaps we're going up to that area as well. But it isn't anywhere near $640 a ton; it isn't anywhere near $550 a ton, and it isn't anywhere near $500 a ton.

Mr. Chairman, that Minister must table the agreement that we have with Wallach and show, the people of British Columbia the kind of rip-off profits that we're giving to this American entrepreneur. The whole deal is wrong, Mr. Chairman; because we are selling at a fixed price. The same report that I quoted before, Mr. Chairman, from The Vancouver Sun, March 19, 1974, attributed to the manager of Ocean Falls, Ted Vesak, confirms that the Gottesman deal is at a fixed price, with the buyer keeping all of the markup — the buyer, Mr. Wallach, keeping all of the markup. He said Ocean Falls production was commanding prices that were a little more conservative because it was committed on contract.

You know, there are a couple of things wrong with this, kind of a black market deal that we've got ourselves locked into. First of all, of course — the most obvious one — is that Ocean Falls supports this black market operation in newsprint without even a cut of the enormous rip-off profits for the people of British Columbia.

Secondly, unwittingly or not, Mr. Chairman, after being placed in the position of contributing to the black market newsprint operation and receiving a return no higher, than that which could have been secured in the conventional newsprint market, Ocean Falls could, after 1976, find itself alone with nowhere to sell its newsprint but in the dump market at a time of oversupply. This could be a reason for the report in the Vancouver Province on March 30 which said:

"As the government undertakes further studies on development of the new operation, the Ocean Falls corporation will, for the moment, continue in the newsprint field taking advantage of current high newsprint prices."

What kind of advantage we are taking? It is Wallach who is taking advantage of the high newsprint prices, not the people of British Columbia. The current high newsprint price as far as Ocean Falls is concerned is a far cry from the price that Wallach is getting on this black market.

Interjection.

MR. McCLELLAND: Director of Can-Cel. You know, the Members on the other side of the House dispute the term "black market."

HON. G.R., LEA (Minister of Highways): You have said that outside the. House.

MR. McCLELLAND: Of course I have said it outside the House already, Mr. Chairman. "Black market" in The Concise Oxford Dictionary, 1910 contains the following definition:

"Black market: illegitimate traffic in officially controlled goods or currencies or in commodities in short supply."

And a "black marketeer" is one who engages in this kind of traffic.

HON. MR., STRACHAN: Do you say that he is breaking the law?

MR. McCLELLAND: Two meanings of the word "illegitimate" are "improper" and "abnormal." I am

[ Page 2956 ]

speaking for the people of British Columbia, Mr. Chairman, in attempting to get this government to table an agreement which will show clearly that we are involved in a black marketeering situation in the newsprint business.

HON. MR. STRACHAN: You define that as illegal.

MR. McCLELLAND: Illegitimate, not illegal.

HON. G.V. LAUK (Minister of Industrial Development, Trade and Commerce): Will you make those statements outside the House?

MR. McCLELLAND: I would like a denial of this if it isn't the truth from that Minister or any other Minister in the government. The Ocean Falls newsprint is finding its way into the black market in Southeast Asia. The Minister doesn't dare deny that because it is the truth — just as the Minister doesn't dare table the agreement that he has with the Gottesman-Central organization because he hasn't got the nerve. He hasn't got the nerve to show the people of British Columbia what kind of a deal we have got ourselves locked into.

Interjection.

MR. McCLELLAND: The Ocean Falls corporation certainly knows the original destination of the newsprint that it ships but maybe it doesn't know the price at which it is being resold. Maybe you don't even know, Mr. Chairman, through you to the Minister, what kind of rip-off profits are being gained by the sale of Ocean Falls newsprint. Maybe we will give you the benefit of the doubt. Maybe you don't know, Mr. Chairman, or don't have the real understanding of the vast amounts that are being contributed through these black market operations.

The price, right now at least, at which Ocean Falls newsprint is being sold is probably this province's — and certainly Gottesman's — most carefully guarded secret. It is time that the people of British Columbia learned exactly what kind of profits are being made by this organization, because if the figures are anywhere near correct about the production of Ocean Falls at somewhere in the neighbourhood of 51,000 tons a year, then we are talking about rip-off profits of maybe $15 million, $20 million, $23 million or $25 million — rip-off profits directly related to a black market trade.

Mr. Chairman, in supporting with all my enthusiasm this non-confidence motion in this Minister, I call once again earnestly and on behalf of the people of British Columbia for that Minister to table the agreements that we have with the Gottesman-Central National Organization and withMr. Ira Wallach in this House so that the people of B.C. can judge your performance for themselves.

MR. LEWIS: I find the debate most interesting. The points put forward so far by the opposition have been very impressive...

MR. McCLELLAND: Thank you.

MR. LEWIS: ...about as impressive as a bowl of cold mush in the morning and about as factual as a fairy tale. They can't deal with facts. They can't deal with what has happened in this province during the time since we have been elected. They are not facts. They don't prove a thing.

You talk about profits. What happened under the Liquor Control Board? What is still happening?

SOME HON. MEMBERS: Oh, oh!

Interjection.

MR. CHAIRMAN: Order! I would ask the Hon. Members not to interrupt the Member for Shuswap.

MR. LEWIS: I'm sorry my friend, you haven't proven a thing to this House as far as I'm concerned. The Hon. Member for Chilliwack (Mr. Schroeder) got up in the House and tried to spread fear of the Minister of Lands, Forests and Water Resources throughout the province. If he is as effective in the church on Sunday in spreading the fear of God, I don't think the people he is working on are getting very much of his message.

MR. J.R. CHABOT (Columbia River): Working on?

MR. LEWIS: Yes, working on. I think it is regrettable that a Minister of this calibre has to put up with the type of thing that was put forward by the Member for Chilliwack. He travelled through the north just prior to the Minister's going up there with the same type of a message. The Minister followed along and got capacity crowds — people who were pleased to see him there and people who were pleased with his programme.

MR. CHABOT: Why didn't he go to Prince Rupert? They wanted him there.

MR. LEWIS: I think for a change the people in the Province of British Columbia area realizing that this government is working for the people of B.C. — not like the past government, not the opposition that stands up in this House. Who do they defend every time? They defend the landlord, they defend the insurance companies and not once do they stand up

[ Page 2957 ]

and talk for the ordinary person in this province.

I think that this Minister has a real good record for cooperating with the people who are in all different areas in this province — people in recreation and conservation. I think that you could ask the Minister of Recreation and Conservation (Hon. Mr. Radford) in regard to the cooperation that he has received from this Minister. It would be far different from any received in the past between the two Ministers. I'll tell you that.

I am hopeful that before this debate's over the Minister will stand up...

MR. CHABOT: And tell the facts.

MR. LEWIS: ...and give you what you have coming to you.

In my view, when he stood up here a while ago he was more than fair. It is amazing that one time we stand up in this session and you are hollering about how mean the Minister is when he is dealing with free enterprise or with the private entrepreneur.

MR. CHABOT: Private what?

MR. LEWIS: Private Chabot. (Laughter.)

And then they come into the House here and start hollering that the free enterprise section is taking our Minister for a ride. I don't think that anyone here in this House has any concern with this happening. I think, though, that the thing that worries you is that we have a Minister in this House who is very capable and you can't find one thing that you can criticize him on.

SOME HON. MEMBERS: Oh, really!

MR. LEWIS: Not one thing. So you have to poke away at personalities. I would just like to say that the Minister has my total support in regard to the programme that he is carrying out. If you want to see the kind of support that exists throughout the province, come to Salmon Arm — come to Shuswap.

MR. FRASER: Where is that?

AN HON. MEMBER: That's your trouble, Alex.

MR. LEWIS: Talk to the mayor of Salmon Arm in regard to the cooperation that he has received from this Minister in many areas, not just in regard to....

Interjections.

MR. LEWIS: No, I'm afraid not. Any time any one of you has any doubts in regard to the reception that is out there, I will go with you to my riding and go up on the public platform and take what is coming.

MR. FRASER: I want to say a few words in this debate on reducing this Minister's salary by $1. I am certainly in favour of it. But I would like to tell the people that even in reducing it by $1 he still gets $47,999. I feel he is very, very much overpaid. At least we will get the dollar back by the reduction to apply against the $20-odd million that will go on the sale of pulp.

This Minister is certainly the heavy in this cabinet. He is so heavy that when he calls the Premier to jump, all the Premier says is, "How high do you want me to jump?" He doesn't even argue with this fellow.

He is the Minister of Lands, and we will have lots to say about his portfolio of lands at the proper time. But he is the Minister of Lands, Minister of Forests, Minister of Water Resources. He is the Minister in charge of the Environment and Land Use Committee. All pollution problems in the province come directly under this Minister. He is the senior Minister director on the B.C. Hydro board of directors. Because of this, he certainly has heavy responsibilities. It is quite important that all sections of his portfolio be debated.

I certainly enjoyed the press that came out of his trip to the north with the Minister of Highways (Hon. Mr. Lea) and a few MLAs back and forth. I don't know what happened to the Member for Atlin (Mr. Calder) and the Member for Omineca (Mr. Kelly); they seem to have been thrown off the bandwagon somewhere along the road and came back home.

I got quite a kick out of the reports from Mackenzie. They have so-called real, serious troubles in Mackenzie. I point out to the House that I don't think there were any problems in Mackenzie prior to this government taking over. This has all cropped up in the last 18 months or so. I think that Mackenzie is a well managed instant town. I see the Minister making a lot of hay about the terrible things, saying there would be no more instant towns while he was Minister with Crown land and so on.

AN HON. MEMBER: Why doesn't he go to Prince Rupert?

MR. FRASER: It was my understanding they did but they missed the pie-throwing contest. I haven't found out the reason. It is too bad because I think it was for a worthy cause. I am a friend of the mayor of Prince Rupert and I imagine he will give the MLA something about that. I think he cost the community about $2,000 they would have raised for charitable reasons if he had taken part in it.

While we are on the trip, they went into an area that I am quite concerned with. I want to deal now for a short time with Plateau Mills and the operation of Plateau Mills. I realize the heavy leaning that was done on the purchase of this. That has been amply covered. I think maybe it is time we looked at the

[ Page 2958 ]

operations of Plateau Mills. We haven't discussed it too much.

I hear lots about the operation of Plateau Mills and how it is operated. I have maps and everything here of the working circle if the House wants to see them.

I would like to tell this House just what this Minister has done about the operation of Plateau Mills.

First, there is established timber industry — in this case the Cariboo and in Prince George too. But this Minister decided, after the acquisition of Plateau Mills, to go and take timber that was designed for an already, established industry and reroute it so that it would come to the Crown-operated Plateau Mills. This will certainly affect the future of the lumber industry in other areas of this province. I don't think that any Minister should gerrymander that to the detriment of established industries which were established without any handouts from this or any other government.

The other thing is the favouritism that is going on with regard to Plateau Mills, and it should be mentioned. They are presently building 50 miles of road. There is waste of no end going on in the construction, of this road. They have spent most of the winter hauling tires out to the right-of-way where they are burning them to try and get some progress going there. But in the end it is costing the public and the Province of British Columbia a lot of money. It can't be costing anyone else.

I would like to know from the. Minister who, is paying for this road? Who is going to pay for this road? What branch of the department is the cost of this 50 or 60 miles of road going to be charged to? It is going to be a lot of money. It should be charged to Plateau Mills, and I have reason to believe it won't be.

This is what happens when you get involved in government enterprise. They certainly won't build roads for the independent operators. They have to go and build their own roads and pay for them out of their stumpage. I am sure that this is not the case with Plateau Mills.

Another thing I would like to mention is the timber on the right-of-way of this 50 miles of road. There is a lot of timber. This timber is being put up for tender as I understand. But the management of Plateau Mills tell other operators who want to bid on it, "Well, sure; you can go and bid on it. We think that it is really our timber but if you bid on it and get it you are going to have to deal with us for the road costs." So they want to know the road costs and they can't find out. The independents won't bid for this right-of-way timber because they are looking at a question mark. Their costs are not defined for them. I think this is another case of government in the timber business giving unfair advantages to themselves to the detriment of other operators — in the general Vanderhoof area as far as that goes.

The House resumed; Mr. Speaker in the chair.

MR. CHAIRMAN: Mr. Speaker, the committee reports progress and asks leave to sit again.

Leave granted.

Hon. Mrs. Dailly moves adjournment of the House.

Motion approved.

The House adjourned at 5:58 p.m.