[ Page 4851 ]

CONTENTS

Routine proceedings

Statute Law Amendment Act, 1974 (No. 2) (Bill 178) Second reading.

Hon. Mr. Hall — 4851

Mr. Smith — 4851

Timber Products Stabilization Act (Bill 17 1). Second reading.

Mr. Smith — 4851

Hon. Mr. Hartley — 4856

Mrs. Jordan — 4859

Mr. D.A. Anderson — 4864

Mr. Chabot — 4867

Mr. Kelly — 4871

Mr. Phillips — 4873

TUESDAY, NOVEMBER 19, 1974

The House met at 8 p.m.

Orders of the day.

Hon. E. Hall (Provincial Secretary): Mr. Speaker, public bills and orders — second reading on Bill 178.

STATUTE LAW
AMENDMENT ACT, 1974 (No. 2)

Hon. Mr. Hall: Mr. Speaker, I will be carrying this bill on behalf of the Attorney-General. As you know, this bill contains a number of principles; each one is a section. I think, by agreement of the House, it will be better to move it into committee so we can get at it properly. May I advise Members that if they gave any queries specifically about any of the sections, I should be pleased to respond to either a word in the corridor, or a note in advance of the debate.

I move second reading, Mr. Speaker, Mr. D.E. Smith (North Peace River): Mr. Speaker, I agree with the Hon. Provincial Secretary that debate on this particular bill is best handled in committee stage since every clause in it deals with something slightly different. We would be quite prepared to debate it in that stage.

Motion approved.

Bill 178, Statute Law Amendment Act, 1974 (No. 2) read a second time and referred to Committee of the Whole House for consideration at the next sitting after today.

Presenting reports.

Hon. R.A. Williams requests leave to table three reports prepared by the British Columbia Research Council on the question of wood chip pricing on the coast and in the interior of the province.

Leave granted.

Hon. Mr. Hall: Second reading of Bill 171, Mr. Speaker.

TIMBER PRODUCTS STABILIZATION ACT

(continued)

Mr. Smith: Mr. Speaker, it's interesting to see the Hon. Minister of Lands, Forests and Water Resources table a report in the House, since he has been very reluctant to table reports or answer questions. It's a little unfortunate, I think, that he didn't table the report this afternoon prior to the adjournment at 6 o'clock so that the information contained in that report could have at least been looked at briefly and quickly by those of us who wish to participate in this debate.

Interjection.

Mr. Smith: I understood, Mr. Speaker, this afternoon when the report was referred to, that it would be tabled.

An Hon. Member: Here it is.

Mr. Smith: Our assumption at that time was that the report would be tabled before the 6 o'clock adjournment. But that's of course….

Mr. Speaker: Members are entitled to read the report while they speak.

Mr. Smith: Pardon me?

Mr. Speaker: Members are entitled to read the report while they speak. (Laughter.)

Mr. Smith: Oh, thank you, Mr. Speaker.

However, I have a few things that I wish to say about this particular bill, and perhaps the report won't add that much to, or detract from what I have to say.

This bill, when you look at it and when we listen to the comments of the Minister of Lands, Forests and Water Resources, and the need and reason for tabling this bill in the House, leads us to form only one conclusion — that the reasons given by the Minister for such a bill, and the ultimate use of that bill, are certainly poles apart. In all the time I have, sat in this Legislature I believe that this bill, the introduction of it and the words and the comments in second reading delivered by the Minister of Lands, Forests and Water Resources have to be as close to being deceitful as anything could be.

An Hon. Member: Withdraw!

Mr. Speaker: I think that the Hon. Member is pushing that a little close to the parliamentary….

Mr. Smith: Mr. Speaker, I intend to give reasons why I believe that to be true.

Mr. Speaker: You can give reasons, but it still would be unparliamentary to suggest that any Member would be deceitful.

[ Page 4852 ]

Mr. Smith: I didn't say it was intentionally his position to do that. But I believe that there is nothing….

Mr. Speaker: It could be misleading. Either accidentally or otherwise it could be misleading, but not deceitful. Deceit implies something intentional.

Mr. Smith: Certainly the information given to the press when introducing this bill — the information that has been delivered on the floor of this House in second reading by the Minister — leads me to come to only one conclusion — that it was misleading. Misleading because the need for the bill, as expressed by the Minister in his words to the press and in his introduction of this bill for second reading, and the actual content of the bill are completely different, with the exception of one clause within that particular bill, in one section.

I suggest, Mr. Speaker, that there was a deliberate attempt to flim-flam this particular issue and throw up a smoke screen which would be bought by the public.

Interjection.

Mr. Speaker: Yes, I think the Hon. Member is right -that Speaker Murray ruled out flim-flam as being….

Mr. Smith: What's the definition of flim-flam, Mr. Speaker?

Mr. Speaker: I'm sure the Hon. Member recalls well the decision of Mr. Speaker Murray on that point.

Mr. Smith: No, I don't recall that point.

Mr. Speaker: Using the word "deliberate" ahead of the word "flim-flam," of course, makes it even worse — doubly so.

Interjections.

Mr. Smith: I think perhaps it would be parliamentary to say it was a flim-flam, without qualifying it. Would it not?

Mr. Speaker: No, I think the flim-flam…. There was a movie called that, I think, sometime…

Mr. Smith: I'm not referring to the movie.

Mr. Speaker: …and the general idea there was the practising of deceit. I think that's why Speaker Murray must have felt it was improper parliamentary language.

Mr. Smith: Mr. Speaker, in introducing this bill, and then again in speaking in second reading on it, the whole justification used by the Minister of Lands, Forests and Water Resources was on one section, and one section only, of the entire bill — the section that deals with the marketing of wood chips in the Province of British Columbia. But the Minister was very careful, very careful, in his comments to avoid referring to the other 20 sections of the bill and the absolute powers that are granted to the B.C. forest products board under the sections included in that bill.

Mr. D. M. Phillips (South Peace River): Dictatorial powers.

Mr. Smith: It is, in our opinion, the power to take over the entire forest industry in the Province of British Columbia. Make no mistake about it, Mr. Speaker, this is the ultimate plan. The problem in this province in obtaining a fair price for chips, resulting n the need of a marketing board, in the words of the Minister, is subterfuge.

Mr. Minister, in the opinion of the official opposition you wanted to create….

Mr. Speaker: Excuse me, the Hon. Member is creating new unparliamentary words about every sentence. You can't say "subterfuge by the Minister," you know that, surely.

Mr. Smith: Subterfuge?

Mr. Speaker: Yes. For you to say that a Minister was using a subterfuge would also imply the same as a deceit.

Mr. Smith: Mr. Speaker, if you'd quit helping me with my remarks, I'd get through them much quicker. (Laughter.)

Mr. Speaker: It might go quicker, but it might go worse. We must adhere to parliamentary rules.

Mr. Smith: Thank you, Mr. Speaker, and that I'll try to do. But it's very difficult when dealing with a bill of this nature to adhere strictly to the parliamentary rules of this House.

I suggest that the Minister, in introducing this bill and prior to the introduction of it, knew exactly what he was doing. It was his opinion that he wished to create a confrontation between sawmill operators and the pulp sector of the industry.

He wanted to create the impression that nothing was happening to improve chip prices in the Province of British Columbia, even though in speaking to this bill this afternoon he admitted that there wasn't a better price paid now for chips than in the past. He

[ Page 4853 ]

also admitted that the pulp industry, in his opinion, can and should pay more.

The fact remains there was an attempt to confuse the issue with respect to the problem involved in the marketing of chips, and gloss it over as if nothing else in the bill really mattered.

I would suggest that this bill will do more to destroy investor confidence in the Province of British Columbia than anything we have ever seen before this House. You certainly indicated that the need for the bill was to protect small operators in the Province of British Columbia. Not so, Mr. Speaker. I'll get on to that particular matter in a few minutes.

I don't think that any of us disagree with the fact that as the market is today the pulp industry can and should pay more for the chips they receive, regardless of who they receive them from, Mr. Speaker, and regardless of whether that particular logger or logging operation is tied to a contract with Can-Cel or any other Crown operation in the Province of British Columbia. It's interesting to note that while you suggest the small operators will be protected by this bill, we have reason to believe that they could be the first ones to go down the tube.

Certainly it's apparent, in terms of expansion and investment in the Province of British Columbia, that one of the major firms operating presently in the Cariboo area has decided to withdraw from an intended expansionary programme. Cariboo Pulp and Paper announced the cancellation of plans for a $140 million bleached kraft pulp expansion at Quesnel based on the use of sawdust, one of the products that we have to deal with in the logging industry, and one which in times past was considered to be of no use.

It's interesting to note that in their release this afternoon they give reasons why they've decided to withdraw from the $140 million project they had planned for the Province of British Columbia. I'd like to quote from their press release. They note:

"Any pulp expansion must be based on a secure supply of raw materials at economic cost. Also, a company must be able to predict the trend of the cost of raw materials over at least 20 years. We had contemplated signing long-term contracts with individual sawmillers in the Cariboo region, including mills at 100 Mile House, Williams Lake and Quesnel. This Act clearly states that the pricing clauses of such contracts would be null and void.

"We would also have required 21-year agreements with the B.C. government, but the government made it clear that it is not prepared to honour its long-term agreements."

This planned expansion was for a mill of 550 tons per day, or 190,000 tons per year. The added money spent in British Columbia would have been about $25 million per year. Added employment would have been about 200 employees in the pulp mill and in the sawmills and logging. The purchase of sawdust for pulp would have significantly increased the revenues to the sawmills from sawdust. The use of sawdust would also have made a significant improvement to the environment by reducing the volume of sawdust and hog fuel that is presently being burned — and I think that there's no question about that. We have not been able to find a market for that product in any sizable quantity except for the generation perhaps of steam.

Mr. Speaker, with the introduction of this bill no one, large or small, in the lumber industry in the Province of British Columbia can plan for the future continuation of their operations. This bill hangs over their heads. Their days are numbered just as the days are numbered of most insurance agents who presently represent ICBC. In my opinion, Mr. Speaker, the Minister is using the whole forest industry as a pawn in a chess game designed to replace individual enterprise with state socialism.

I suggest that the Minister's lust for power in this respect knows no bounds. It would appear to me that a frustrated city planner is looking for a means to punish the business world for imaginary injustices, certainly to the discredit of the office he holds and the Province of British Columbia in general, with respect to the No. 1 industry that produces more revenue and more dollars in total than any other industry in this province — rightly concerned about their future in the Province of British Columbia.

This Minister, together with the Minister of Finance, tried to play one segment of the industry against the other; tried to provoke disagreement between the independent loggers and the larger operations in the Province of British Columbia; tried to pit the sawmill industry against the pulp mill operators. The game plan was to divide and conquer, only it didn't work out quite to the satisfaction of the Minister. It's a fact, Mr. Speaker, that in the coastal forest areas dialogue between sawmills and pulp mills was taking place long before the introduction of this bill. As a result of that dialogue, chip prices had moved steadily upward, particularly in the last few months. I think that it's fair to say that the greatest improvement has been in the last three weeks.

But what of the interior? There you must ask yourselves which company exerted the greatest influence on the chip prices paid. Is it not true that in northwestern British Columbia the company exerting the greatest influence is Can-Cel? Naturally; they're the only pulp mill located in that area. And what other pulp or paper company, mindful of the power of the Minister over their operations and future, would dare to volunteer an increased price for chips against the expressed desire and determination of a Crown corporation, intent upon showing a profit in

[ Page 4854 ]

its first year of operation, to keep the price of chips down.

For two full years, Mr. Speaker, Can-Cel literally stole their chips from the independent operators in the province. It's a shame. It's a shame. They were prohibited from marketing their chips anywhere else.

Hon. R.A. Williams (Minister of Lands, Forests And Water Resources): That was Social Credit policy.

Mr. Smith: No, not at all, Mr. Speaker. Whenever a supplier of chips is required to take a price that is 60 per cent at least below what is determined to be the average market price for chips at a given time, those chips are literally being stolen from them.

What a difference the extra income would have made to the independent operators in those areas, provided, of course, that the increased price for chips resulted in increased returns for the independent operator. Therein, I suggest, lies the root cause of a problem the Minister chose to ignore up until the time he introduced this bill last Friday, a problem that was drawn repeatedly to his attention, a problem that received nothing in the way of aggressive action until the bill was introduced last Friday. May I elaborate?

It's a matter of fact that dialogue was taking place between the sawmills and the pulp mills in the northern part of British Columbia as well as in other areas of the province. It's a matter of fact that one of the problems involved, as expressed to the Minister, was a need for some changes in the close utilization policy introduced by the Minister. The problem would appear, and was, in the minds of the people involved in the marketing of chips, that it did not matter if they were able to negotiate a higher price or not.

As long as the present stumpage appraisal system remained in effect, 80 per cent of everything paid for the chips over a base of $10 per unit would go to the government in increased revenue. That was the whole nub of the problem — that even though they were successful in negotiating a reasonable price for the chips they had to sell, the government, under their stumpage appraisal system introduced a year ago, would take 80 per cent of that price over $10 per unit. Was this going to help the industry survive a critical time in the province when the price of lumber and dimension material had decreased rapidly?

I say that it was impossible for anyone engaged in the industry to do anything but try to patch up and improvise a programme until they got some commitment from the Minister of Lands, Forests and Water Resources that would indicate to them some relief from that impost that would take most of the money paid by the pulp mills in increased revenue to the Crown,

Now, when did the Minister suggest that he would declare a holiday from this particular section of the stumpage appraisal programme for a short period of time? It happened last Friday, at the exact time that the Minister introduced the bill to the House. Oh, clap and thump the table. It's interesting to know that the holiday from this increased impost by the Crown would only extend to June 15, and there was no suggestion that it would be continued beyond that point. I suggest that the industry has no confidence in the word of the Minister. They had no way of knowing whether what he said on Friday would, in fact, be carried out, or for how long that particular system would last because, from experience, they have noted that this government is quite prepared to change the rules of the game, introduce new rules, cancel contracts, or whatever they consider expedient at any time, and without any justification.

Not one industry associated with this problem, either small or large, advocated a marketing board as the solution to their problem. What they did ask was that the government amend the stumpage policy to stop plundering the payments made to them for chips they were about to sell. On that particular score, they could get no answer, no answer at all, from the Minister until last Friday when this bill was introduced to the House.

I'd like to illustrate one of the problems involved in the people cutting logs in British Columbia. It's perhaps a little extreme in that sometimes this particular problem would not occur, but it does occur, and it has occurred in the past. I'd like to refer to a stumpage assessment based up on 60,000 board feet of logs at $8,043, or $134 per 1,000. Purchase order for those logs to be cut, and the finished lumber sells at $147 per 1,000. The logger who cut the logs had to sell the boom for less than $8,048 stumpage after he had paid all the costs of logging. The costs of logging, $130 per 1,000; cost of sawing, $70 per 1,000; the stumpage paid to the province in right of the Crown, $134 per 1,000, for a total of $334 per 1,000; and the end product value of lumber was only $117 per 1,000.

Mr. D.E. Lewis (Shuswap): Where do you get your costs from?

Mr. Smith: Those are factual costs and I'll give them to you. It certainly illustrates the extreme problem experienced by the people in the sawmill business in the Province of British Columbia, and one of the reasons why they needed an increase in the price that they received for chips, and needed it immediately, if they were to continue operating in the woods in the Province of British Columbia.

Bill 171, the Timber Products Stabilization Act, can be criticized on many counts, but the basic, underlying intent and philosophy appears to start

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with the definitions of forest products and wood chips in paragraph 2, followed by the object and powers of the British Columbia Forest Products Board contained in a very brief paragraph in paragraph 7. The intent is further revealed, I believe, in paragraph 8(l), where the matters the Minister can direct the board to enquire into are listed, and in p paragraph 8(3) where the matters the Lieutenant-Governor-in-Council can direct the board to enquire into are listed. I would refer, with particular reference, to the all-inclusive paragraph, 8(3)(b): anything the government-appointed board recommends that is to the liking of the Lieutenant-Governor-in-Council can be implemented, as set out in paragraph 19, without reference to the Legislature, and that is one thing we object most strenuously to.

Most of the provisions of this bill deal with matter in the industry other than the marketing of chips. Most of the provisions of this bill give extreme autocratic powers to the board appointed by the Minister. In general, this Act gives the B.C. Forest Products Board the power to do almost anything in the forest industry that the government directs, without reference to the Legislature. Once a year, when the annual report is presented, the Legislature will get just about as much information as provided to a common shareholder who happens to own shares in the CPR or some other large corporation — once a year, a few facts, a year behind time at that.

Further, I would like to suggest that the B.C. Forest Products Board has complete government financial backing, subject only to the pleasure of the Lieutenant-Governor-in-Council. Let's examine for a few minutes what that really means, that power. It's contained, I believe, in the bill itself, and I'd like to refer to it in a few moments. You know, the prospect of the Minister of Finance having absolute blank-cheque powers over the revenue of the province and the power to dabble in the stock market alarmed us, and rightly so. I think the result of our original alarm certainly is borne out in some of the investments that the Minister has made on behalf of the people of British Columbia.

At the present time, the Minister of Finance, with his dabbling in the stock market, shows at least a $10 million loss in the shares that he has purchased. Now in section 12(2) of this bill, added to the other overwhelming fiscal authority, is the prospect that this Minister, the Minister of Lands, Forests, and Water Resources, can now dabble in a very volatile currency market place, other than markets in Canada — the foreign markets, as a matter of fact.

Let me quote the powers that the Minister has: the Minister, in section 12, with respect to borrowing, can invest money in, "notes, bonds, debentures and other securities, the issue of which is authorized by subsection (1)," redeemed at maturity, payable at such rate of interest as the Lieutenant-Governor-in-Council may determine, in the currencies of such country, Mr. Speaker, and I repeat that:

"…in the currencies of such countries, in such amounts or prices, in such manner, and at such times…as the Lieutenant-Governor-in-Council may determine."

What is the ultimate aim of the Minister of Lands and Forests in this respect? Is it to invest in currencies of other countries, to dabble in the international market? Perhaps we are going to invest in the currency of China, or the currency of Russia, or the currency of almost any other socialist country.

This prospect not only causes us alarm but it gives us reason to believe this government would be willing to take this province on the road to financial ruin simply to advance an ideological argument. In recent months the world's greatest financial institutions, including Lloyd's of London and Chase Manhattan of New York, have been badly burned through transactions on world currency exchanges.

The volatile price of gold today, the shaky position of the dollar, the alarming increase in the revenue available and the dollars available to those countries with a large petrochemical reserve or oil reserve would give any sensible government cause to be cautious and use restraint.

But here in section 12(2) of this bill the entire fiscal guarantees of this province are laid on the line for yet another socialist experiment. This guarantee involves not only the consolidated revenues of British Columbia but it also lays on the line the most actuarially sound pension fund accounts of anywhere in the free world, a record that we had reason to be proud of in the Province of British Columbia.

And the Minister laughs.

The attitude of the Minister is amazing when he is faced with some of the ramifications of the legislation that he's introduced. He scoffs, laughs, tries to make light of it, but it's a matter of fact….

Mrs. P.J. Jordan (North Okanagan): The Godfather of the forest industry!

Mr. Smith: But either the Minister does not know the ramifications of this bill or he chooses to ignore them, hoping that no one else will pick them up.

The Minister, through a non-elected board, under the authority of this Act, has the power to gamble with the taxpayers' money on the international market and on the international exchanges. This authority, in my opinion, to gamble with the resources and the savings of thousands of people in this province is a manifestation of the Minister's hang-up with state socialism. And it is certainly unacceptable to the official opposition.

[ Page 4856 ]

The Minister squandered $5 million on Ocean Falls and has proved himself unwilling to disclose to the public the full accounts of that corporation. Oh, it's making money, the Minister says. Well, if that is true, why don't you file the returns on the floor of this House?

Interjection.

Mr. Smith: He's certainly dabbled in the international marketplace with respect to newsprint and the sale of newsprint from Ocean Falls. The fact is that the sale of production from Ocean Falls is relatively simple compared to the day-by-day dangers which face people dabbling in the foreign exchange.

How could anyone trust a Minister who has a record in this House of answering no questions, written or oral? How could anyone trust a Minister who has conducted most of the public business he is responsible for in secret, behind closed doors, and with no information to the public?

That a board in such hands could be involved with secret deals involving the fiscal money markets of the world is a disaster looking for some place to happen. To involve the savings and the fiscal resources of this province in Wall Street borrowing for B.C. Hydro was bad enough. But to have the Minister of Lands, Forest and Water Resources walking around in the money-changing temples of the world is simply devastating.

Hon. R.A. Williams: I've done very well so far.

Mr. Smith: The Minister says he has done very well so far.

Mrs. Jordan: How? Give us an example.

Mr. Smith: Where? Can-Cel? At the expense of the small operators in the woods up there?

Interjection.

Mr. Smith: Purchasing chips for under $10 a unit that are worth three times that amount? Is that a record you are proud of, Mr. Minister?

It is interesting to note that the $12 million profit made by the corporation in its first year of operation under the Minister would have resulted in no profit at all had the corporation paid the amount of stumpage that they should on the cut that was there and paid what they should have for the chips that they took from the small lumber operators in that part of the country.

I don't think the Minister can use that kind of invective to justify his situation or to give the people of British Columbia a justifiable answer as to his reason for introducing this bill.

With the provisions in this bill, no person in the province can sleep soundly knowing the Minister of Lands, Forests and Water Resources has the right by statute to fritter away tax dollars in the currency of other countries, particularly when we reflect on the record of some of the countries most closely aligned with the philosophy of this government. This Minister has his hands in the pocket of every British Columbian.

Interjection.

Mr. Smith: Oh, is he now? This we would like to see. And who was he getting the money from to put there? From the small operators involved in the forest industry in the Province of British Columbia?

Mr. Speaker: Excuse me, the Hon. Member's time has expired.

Mr. Smith: I only have another minute to go.

Mr. Speaker: I'm afraid you will have to ask leave to speak longer than your 40 minutes. You started at 8:06 and it is now 8:46.

Mr. Smith: Mr. Speaker, I'm concluding my remarks; I have probably 30 seconds more to say to the House.

Mr. Speaker: Shall leave be granted?

Leave granted.

Mr. Smith: The Minister, by statute, has his hand in the pocket of every British Columbian, including the heretofore inaccessible pocket containing the vested funds required to keep the government's pension funds solvent. It's a sorry day for British Columbians when the Minister used the excuse that he did to introduce Bill 171. We will all be sorrier for that event.

Hon. W.L. Hartley (Minister of Public Works): Mr. Speaker, I think after all that cry of gloom and doom, the least we can do is draw back the curtains and let a little moonlight in. If it was daylight, I would say a little sunshine.

We certainly shouldn't be surprised that the first time in the history of this province we have a leader of a political party by inheritance.

Interjections.

Hon. Mr. Hartley: It has to do with Bill 171.

Interjections.

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Hon. Mr. Hartley: We have a hand-me-down leader. The reason we have this hand-me-down leader, Mr. Speaker, is that this party sitting across there has been so devoid of ideas, imagination and courage that they have a hand-me-down leader. For the first time they have inherited a leader.

Mr. Speaker: Excuse me. I think the Hon. Minister of Public Works is not really entitled to attribute the lack of courage to the whole of the opposition nor against any individual.

An Hon. Member: Hear, hear!

Mr. Speaker: Would the Hon. Member withdraw that?

Hon. Mr. Hartley: I'll confine it to the Members in the front row then. (Laughter.)

Mr. Speaker: I'd appreciate it if the Hon. Member would withdraw those words.

Hon. Mr. Hartley: I withdraw.

We heard the same speech from the speaker who just sat down, the Member for North Peace River (Mr. Smith) when we brought in legislation to deal with the B.C. Petroleum Corporation two years ago. Then on March 9 — where's that clipping? — last year, the Province on the financial page said that the petroleum industry up in the Peace River, B.C.'s oil spot, is booming like never before, despite all of the gloom and doom of the Member for North Peace River.

We heard that speech two years ago. We heard it this year on Bill 31. Now he's recycling the same old story on forestry. And even though it's the third time round, it's getting longer and worse. He had to have overtime to do it.

Interjection.

Hon. Mr. Hartley: Yes. We heard that caretaker leader say this afternoon….

Interjections.

Hon. Mr. Hartley: I hope so. I hope so.

We heard the caretaker leader this afternoon, after it had been pointed out that in 1952 when that caretaker government that cared very well for the great international corporations started, there were 2,223 sawmills in this province, after 20 years of social caretaker corporate government.

Mr. Phillips: How many insurance companies in B.C. today?

Hon. Mr. Hartley: Too many, far too many. (Laughter.)

And what did that caretaker leader say when he spoke this afternoon? That caretaker leader said, "Here, do you want to bring back those 2,000 mills? Those little mills are not efficient. Free-enterprise is not efficient. Corporate enterprise is more efficient." I wrote it down.

That's the corporate-enterprise government that had giveaways for 20 years. It gave away our forestry products, our mining products, our natural resources and gave away our people to foreign corporate control. Poor old dad.

Interjections.

Hon. Mr. Hartley: Yes, we'll hear the same old song about investor confidence. Our Member for North Peace River, that's his song: investor confidence.

Now, let me give you a little story about investor confidence. Shortly after this little government was elected and shortly after the Hon. Robert Williams was chosen as Minister of Lands and Forests, in a post for which he is very well-trained and very capable of handling and doing a most capable job of administering, the Minister of Lands and Forests found that a deal had been made by the previous government whereby Weyerhaeuser was going to pick up Columbia Cellulose as a bankrupt corporation. The deal was all made. All it had to be was signed and sealed, But with proper understanding and good business management, that Minister said, "Before any Crown lands, any Crown forests or Crown resources involved in my department are transferred from one great corporation to another, I want to know about it. I want those deals to pass over my desk."

And so, checking this out, what did he find? He had the people of Weyerhaeuser in and they said, "Yes, we're prepared to pick up this bankrupt corporation."

"What will Weyerhaeuser pay for it?"

"We will merely guarantee the $68 million worth of Columbia Cellulose bonds that are many years old — 20 years old, some of them — at 4.5 and 5.25 per cent interest. All we will do is guarantee those bonds and we will pay for them out of the earnings of the corporation."

"But," he said, "how will you make it pay? Last year they lost $9 million."

"Oh," they said, "we'll shut down the entire northern operation — that's where the loser is — and we'll keep the Kootenay operation going. That's the gold mine; that's where the money is. We'll have no trouble paying it off."

So, in his wisdom, the Minister said, "Well, I guess if a little international corporation like Weyerhaeuser can guarantee $68 million, we should be able to."

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So with that we did. But there was a difference.

Interjections.

Hon. Mr. Hartley: Had Weyerhaeuser, the international corporation that had been befriended for 20 years by the Social Credit, been allowed to take it over, (1) they would have shut down the entire northern operation; and (2) there would have been vast numbers of unemployed and more people on welfare. Of course, that's the way the Socreds would like to have it. And they like to keep screaming gloom and doom.

It would happen again if they could, but it won't, not in this department, not as long as that Minister is handling Lands and Forests.

Along with that, some 9 million acres of prime forest land were returned to the people of this province. And those people opposed that legislation. Those caretakers of the opposition…. And they won't be there long; someone else will move over if you don't smarten up. They'll be defeated as opposition in the next election, because how can you get up and defend corporate enterprise as being more efficient — rubbing out the little guy — when we as government challenged that corporate enterprise? Because of our challenge to them, the people of this province now own three pulp and paper mills, sawmills and 9 million acres of prime forest land. And what happened? What did it cost? It did not cost this government or the people of this province one red cent. And in the first six months of last year — the switchover took place on July 1, 1973 — there was a $12 million net profit and $ 17 million of the $68 million of bond indebtedness was written off. This year in the first nine months there are $36 million of net earnings.

This is the sort of thing that you people are going to get out on the hustings and say that you are opposed to. You're opposed to people enterprise, This is people enterprise. After 20 years of corporate enterprise, you haven't got the brains to support a good thing when you see it.

Mr. Phillips: Even your own Minister is laughing at you. You had better sit down while you're ahead.

Hon. Mr. Hartley: So with this, the people of this province not only have 9 million acres of prime forest land but we have a yardstick by which we can judge the proper method by which better forestry management can be handled. We have a yardstick whereby we can unit-cost the production of pulp, of paper, of lumber or any other product that we should choose to manufacture in this province. This is people enterprise.

Those people wouldn't have said a thing if we'd have let Weyerhaeuser take over as they have done for the previous 20 years under them and the previous 80 years under the Liberals and under the Conservatives. That is what has gone on heretofore.

We get a good story from our friends in the media, but the big daddies that pay for the media may reverse it.

Interjection.

Hon. Mr. Hartley: I'm not attacking the press. I say these people work for their living as we do. But so long as the corporate enterprise that you people back control the papers, okay, it'll be up to us to come into your ridings and tell the story of people enterprise.

Interjections.

Hon. Mr. Hartley: Well, we've got lots of reason to be wound up when we see the leader of the Conservative Party, (Mr. Wallace) the leader of the Liberal Party (Mr. D.A. Anderson), the leader of the Social Credit (Mr. Bennett) all taking the same story, standing up and espousing and defending corporate enterprise.

Interjections.

Hon. Mr. Hartley: Sure, they should all get into the one party.

Some Hon. Members: Oh, oh!

Hon. Mr. Hartley: All get into one party. There's no difference.

Interjections.

Hon. Mr. Hartley: Well, he used to stand over here. I watched him for long enough.

Mr. Speaker: I wonder if the Hon. Member for Oak Bay would stop orchestrating. (Laughter.)

Hon. Mr. Hartley: Oh, Mr. Speaker, there is nothing more infectious than enthusiasm. I'm glad that the enthusiasm for people enterprise is so infectious that it's catching up the leader of the Tory party of this province.

Interjection.

Hon. Mr. Hartley: Well, Mr. Speaker, these people might have some right to defend corporate enterprise if they had one good example of where the people of this province had benefited because of corporate enterprise.

[ Page 4859 ]

Interjection.

Hon. Mr. Hartley: When you look at the mining industry of this province, you'll find that for 20 years under Social Credit, and for 80 years under the Liberals and Conservatives, that those governments didn't sell one ounce of minerals to the mining industry. Not one ounce.

I'll tell you a little story, and it applies to this bill, Mr. Speaker, because just as we're trying to get a fair shake for the people of this province, from Forestry in the spring we passed Bill 31 to get a fair shake for the people of this province, not in taxing but in selling the mineral resources of this province.

If you picked up the Province, our very responsible, conservative paper, read their financial page, on the November 8 they point to a mine — Lornex, just in back of Merritt — and what do they say? They say that Lornex Mining and Smelting this year has $23 million of corporate profits. Last year it was $20 million. This year they're up by $3 million, but they're up by $3 million after they have paid $10 million for the minerals that they used. They paid $10 million to buy the minerals from the people of this province, so in all, a year ago they paid $3 million….

Mr. J.R. Chabot (Columbia River): What's that got to do with this bill?

Hon. Mr. Hartley: It relates — this is forest products; this is mines. If you'd been here a little earlier, Mr. Member for Columbia River, you'd get the picture.

Mr. Speaker: I wish the Hon. Member would stick to the principle of the bill which has to with forestry, please.

Hon. Mr. Hartley: Yes, Mr. Speaker. I was using that as an example to point out the principle in Bill 71. Just as the people of the Province of British Columbia are much better off because of this principle, the principle that is in Bill 171, Bill 31 is now in effect and some $30 million will roll into the coffers of this province which had never heretofore been seen, because our mineral products had been given away, our forest products had been given away or sold for all too little.

Mr. Lewis: The give-away boys.

Hon. Mr. Hartley: The give-away game, that's right.

Now, I told you about Weyerhaeuser trying to take over Columbia Cellulose. When my friend from North Peace River (Mr. Smith) got up, the caretaker-leader, that leader who inherited the leadership of the Social Credit Party because there was no competition….

Interjection.

Hon. Mr. Hartley: How's that bull shipper from the Cariboo? When did you come in?

An Hon. Member: That's got nothing to do with this bill.

Hon. Mr. Hartley: Well, bull shippers have bulls, they graze on the grass, and grass comes out of this department.

Mr. Phillips: The Premier throws a lot of chips around when he goes to the Cariboo.

Mr. Speaker: Order, please. I wish the Hon. Member who is speaking would stick to the bill, It hasn't to do with Can-Cel. It doesn't have anything to do with grass or chips, or anything other than wood chips.

Mr. Phillips: Chips, that's right. It doesn't have anything to do with chips! It's a take-over bill.

Mr. Speaker: It has to do with wood chips, not the chips that you were referring to.

Hon. Mr. Hartley: The Member for South Peace River says: "It's a take-over bill." Now what did he do in the years that he sat in the House in government, in the years between 1952 and 1971? In 1952 we had 2,223 sawmills in this province, and by the time that government left office there were some 627 sawmills. That's a reduction to less than one-third.

Now, if that had happened under NDP, they would have said that is the heavy hand of state socialism, but that, Mr. Speaker, was not state socialism, that was the heavy hand of corporate capitalism via the Social Credit. That's corporate capitalism; that's what they do to the little guy. And your leader this afternoon said: "Small business, little sawmills are not efficient, but the big international monopolies are efficient." That's what you people represent — corporate capitalism — whether it's the insurance industry or the forestry industry.

An Hon. Member: You've had it now.

Mrs. P.J. Jordan (North Okanagan): Well, I'm sure, Mr. Speaker, that the Minister of Lands, Forests and Water Resources (Hon. R.A. Williams) was rising to expound that he had just hired a new conflagaro — after that last dissertation. It reminded me, Mr. Speaker, if you're a bird fancier, of what they call an

[ Page 4860 ]

alto water roll.

I suggest that his argument, such as it was, was very similar to the husband who went home and told his wife that he'd save her $50 because the gun he bought only cost $125 instead of $175, because while he described the great profits that were coming into the Treasury, he forgot to mention the massive amount of capital and profits that are fleeing this province through lack of activation of that capital in this province.

Mr. R.T. Cummings (Vancouver–Little Mountain): At least he had an excuse.

Mrs. Jordan: Yes, but his mother doesn't.

Mr. Speaker, if one examines….

Interjection.

Mrs. Jordan: If you want to make a speech, why don't you get on your feet?

Interjections.

Mrs. Jordan: Obviously the Member for Vancouver–Point Grey (Mr. McGeer) is sitting there warming up his engine.

Mr. P.L. McGeer (Vancouver–Point Grey): Am I going to make a speech?

Mr. Speaker: Is the Hon. Member yielding the floor?

Mrs. Jordan: Is the Hon. Member what?

Mr. McGeer: At least mine would relate to the bill.

Mrs. Jordan: Well, that would be a change.

Mr. Speaker: I wonder if you'd speak to the Chair instead?

Mrs. Jordan: Mr. Speaker, I'm sure you're aware that throughout this debate, and particularly throughout this bill, there's a weaving of the warp and woof of intention that can only be summed up as a theme of crafty legislation.

This Minister talks about chips and chip prices; he talks about $60 a BDU at the pulp mill, f.o.b. This sounds very dazzling when one thinks in terms of the other prices he's used, and that we're aware of, and he seems to be weaving a picture for the public where they'll get the impression that the independent sawmill operator is going to receive an increase from $16 to $18 a BDU to $60 a BDU.

And while indeed he is bringing in an increase in the chip prices, this crafty approach just doesn't make clear that the former price was f.o.b. at the sawmill, and that the price he's talking about, although indeed an increase, is not nearly as great as he would have the public believe, because it is, in fact, f.o.b. at the pulp mill. This is one more example of how the Minister is trying to create an impression which is not fact.

If you examine, while the Minister talks about chips, Mr. Speaker, section 7 of this bill, just three simple little lines and I'll read them because they do sound very, very innocent and, as I say, very simple. It says:

"Without limiting the generality of section 6(l), the objects of the board are and it has the power to improve the performance of markets for forest products, and to encourage the utilization of timber, in the Province."

Mr. Speaker, I wish to assure you that gun and those simple little words are loaded. If you examine it, you will find they are loaded at the very people the Minister tries to suggest that this bill is designed to help — the independent operators in this province.

It's very interesting that while the Minister has talked about his concern for the independent operator, and he dazzles around these $60 a BDU — f.o.b. the pulp mill — which you don't say very loudly, the people who are most concerned about this legislation at this time, other than the Members of the opposition who can see through this peek-through legislation, are in fact the very people that the Minister says he's trying to help, the independent sawmill operators in this province.

While they indeed want an increase in the chip prices, and have asked for assistance in this area, they did not ask to sell their soul for this help. They know that the battle is on between the Minister's obsession in relation to the forest industry in British Columbia and the facts of life, and that they, not the government and not the big companies, are going to be the pawns in the NDP takeover game.

It's also interesting to note, Mr. Speaker, that while this crafty little bill is being debated in this Legislature, the Minister of Finance and Premier of this province is not here. He's on a flying trip to China. Frankly, Mr. Speaker, if I was the leader of that party, and I had a Minister bringing in this type of legislation, I'd run away to China too.

It's also interesting to note that while the Premier and Minister of Finance has turned his back on this Legislature and on this legislation, and refused to be here to be accountable — because it's his coffers that are going to swell at the expense of the little operators and the little people in this province — two other men in British Columbia are not here. Two men who are among the most powerful and who, indeed, should be among the most concerned in this province are not here; they're winging with the Premier. I refer

[ Page 4861 ]

to Mr. Jack Monroe, who is the head of the International Woodworkers of America and who has the responsibility of defending and protecting the rights of the woodworkers in this province; and Mr. Dennis Timmis, president of MacMillan Bloedel.

Both of these gentlemen were little short of enticed to take a trip to China with the Premier, but no sooner had they set foot on the plane and taken off than this bill was introduced. They could come home, Mr. Speaker, and it might be well for them to come home now, or else to take a slow boat from China home, because there is unlikely to be anything for them to come home to when the real intent of this bill is proclaimed, Well, the Minister laughs, and he laughs all through this debate. I would just remind you, Mr. Speaker, that psychiatrists have a number of sensitivity lines that they remember in dealing with their patients. One of them is: "Beware of the man who laughs all the time, for he hides a troubled heart."

I suggest that the Minister indeed laughs and laughs and laughs because he has a troubled heart — troubled not as we would expect by his conscience for the type of legislation that he's slinking into this House, but troubled by the fact that the truth will out before this legislation is passed, and he will be thwarted in his tsarist desires and his obsession to take over the forest industry.

Interjection.

Mrs. Jordan: The Minister indeed. You know, Mr. Speaker, some months ago, in responding to a question put by a press interviewer, the Minister of Lands, Forests and Water Resources said, and I would like to paraphrase what he said: "Given three years of power" — not responsibility, Mr. Speaker, but three years of power — "we will create such an economic omelet of Crown corporations, boards and commissions that it will never be unscrambled." That is a paraphrase of the Minister of Lands, Forests and Water Resources, who is now putting himself in the position of being almost a self-proclaimed godfather to the forest industry. In Bill 171, Mr. Speaker, which we're debating, dealing with the forest industry, we see in fact the final batch of eggs which will launch the people of British Columbia into a mess that is a 100 per cent commitment to socialism — a socialist omelet described some time ago by the very Minister who is now the architect of this bill.

Mr. Speaker, it's very significant to note that the Minister himself has referred to a three-man quorum as the power in this bill. A troika: can you imagine it, Mr. Speaker — in British Columbia a three-man quorum, a troika of Williams, Gaffney and a flunky? This three-man troika, this quorum of Williams and Mason Gaffney and an unproclaimed flunky is to be given the legal authority above the courts, above this Legislature, above the Companies Act, above question, to control 50 per cent of every dollar earned by every British Columbian.

One shouldn't truly be surprised because, if you look at the legislation, you can see that a good deal of it is lifted almost directly out of the Waffle Manifesto.

The Minister laughs again. I guess his heart is troubling him. It's a famous manifesto, and it certainly has been this Minister's blueprint for British Columbia. It was signed by the Premier of this province, who doesn't now have the conscience to stand in this House and be here when this bill is brought in. It was signed by Eileen Dailly, the current Minister of Education. And with all due respect, Mr. Speaker, it was signed by yourself; but then you were a politician at that time.

Mr. Speaker: You must never bring the Speaker into the debate.

Mrs. Jordan: You don't have to answer, Mr. Speaker.

It was signed by the Minister of Municipal Affairs, currently Mr. James Lorimer, and it was signed by the chief officer of fair play and justice for this province, the Attorney-General, who is charged with the responsibility of defending the rights of the individual within a democratic society in this province. That is a man by the name of Alex Macdonald. Where is he tonight when these rights are being trampled by this legislation? He is not in this Legislature where he belongs to hopefully adjudicate impartially on the bill's effect. He too is sojourning and joyriding in communist China.

It was signed by the Minister of Human Resources, Norman Levi. Is he here tonight, Mr. Speaker, to account for this bill, to play a role in this debate, to try and point out the pros and cons and the benefits to the people of British Columbia? No way! He's not here, and unaccounted for. Perhaps he's taken a quick trip to China.

Mr. Speaker, in the Waffle Manifesto it says on page 10: "As part of its political programme, public ownership will not….

Interjection.

Mrs. Jordan: If the Minister would listen, he might understand what the independent operators, who you say you're trying to help, are concerned about, and why they look at your gift as possibly a few pieces of silver. The document says:

"Public ownership will not in itself bring about an independent socialist Canada, but it is the crucial precondition for the building of such a society. It is with that perspective that we adopt the following principles:

[ Page 4862 ]

"1. As part of its political programme, the NDP must commit itself to the immediate nationalization of resource industries and financial institutions, including bank and trust companies."

Already the Premier of this province has committed himself to the position that all resources in British Columbia will be turned over to the federal government, holus-bolus, when they will commit themselves to nationalizing. Is this the first step in your battle, Mr. Minister, through you, Mr. Speaker?

Interjection.

Mrs. Jordan: No it wasn't, Mr. Speaker. If I recall correctly, the Minister was questioned as to whether this would include the forest industry, and he said: "All resources." It goes on to say in the Waffle Manifesto: "This public ownership will pave the way for nationalization of other sectors." We see in this bill a board which is an agent of the Crown in the right of the province for all purposes, and empowered by law to carry on its powers and duties in its own name, without specific reference to the Crown in the right of the province.

Doesn't it fit well, Mr. Speaker? The pattern fits so well. We see a corporation with the powers and capacity of a company incorporated under the laws of British Columbia and under the Companies Act.

HON. R.A. WILLIAMS: Sweeping powers.

Mrs. Jordan: Ah, indeed, the Minister says that's sweeping powers. Not sweeping powers for the companies of British Columbia, which we would oppose, but this company that the Minister is setting up is above the Companies Act. It is not subject to the same rules and regulations; it is not subject to the same scrutiny; and it is not subject to the same position where the shareholders can, in fact, ask for a complete review and investigation of the actions and financial statements of that company. Oh, it fits in very well with the Waffle Manifesto, and the Minister himself is quite right. He pointed this out, and I'd like to thank him for saying what a powerful company it is. There's no responsibility for it to define the nature of its business or the reasons for which it uses the taxpayers' hard earned money.

Let's look at some of the other parts of the Waffle Manifesto. It says in part 11:

"The NDP commits itself, as its long-term goal, to the public ownership of major corporations in the manufacturing, resource, financial, transportation, and commodity distribution sectors of the economy."

My, that fits in very well. Indeed, this is a Crown corporation that can borrow money without limitation, with the exception of the secret approval of that Minister and his cabinet colleagues. They have the right to deal in the currencies of foreign countries.

Hon. R.A. Williams: That's absolute nonsense.

Mrs. Jordan: The Minister says that's nonsense. Presumably then, if the Minister believes what he's saying and this is not another one of his shifty toe-dances, he doesn't know what is in his own legislation. If that's the case, not only should he be condemned for the legislation but he should be condemned and stand condemned by his own ignorance. This company has the right to earn revenues by doing business of an unstated nature and to retain all these moneys received for such purposes as it considers necessary; not the Legislature, not the people of British Columbia, but the great "it."

Now, part V of the Waffle Manifesto, and I won't read all the other sections because you are familiar with them, having signed the Waffle Manifesto: "Existing Crown corporations and public enterprises, must be fundamentally reorganized to permit democratization." Well, this is even a contradiction to their own Waffle Manifesto. It's worse, because a board is the exact opposite to democracy, and that is dictatorship.

The board is authorized to work behind an iron curtain of secrecy, or a wooden curtain, if you would prefer, of secrecy, without telling the people what it intends to do and without being accountable to the Legislature for its policies or its actions; complete disregard for the Companies Act, which all other companies have to function under in British Columbia; a complete disregard for this Legislature, which represents the views of the people of this province and whose Members are duly elected; a complete disregard I'm sure, as with ICBC, for the enquiries and the responsibility of the Minister of Consumer Services (Hon. Ms. Young) so that the victims of this bill will have no recourse.

No other Legislature in Canada has ever given such unlimited powers to any board as this government and this Minister seek to take in this bill. This is so incredible that it's almost unbelievable. It's like a nightmare, but the only difference is that in the morning when the people of British Columbia wake up, unlike a nightmare, it won't be just a dream; they'll find themselves in exactly what this Minister designs — an NDP socialist British Columbia.

In speaking to section 7, the objectives of the board, as they're described in that section of the bill, are not an open statement of intent. What we have in that section 1s a taxing authority which is disguised as a Crown corporation. If this bill goes through, it's in business. This Crown corporation is in business to practise legalized plunder. The victims of that plunder, Mr. Speaker, are again going to be the very

[ Page 4863 ]

people that this Minister pretends that he is protecting, and they're aware of it.

The Minister has tried to imply that he's met with all these independent operators in British Columbia when, in fact, this is not true. Mr. Williams, the now Minister of Lands, Forests and Water Resources, in 1971 gave a speech in which he said:

"The acquisition of privately-owned corporations in the resource field prior to major resource tax changes would be a mistake because the market price of those companies would be grossly inflated."

That is very much the concern of part of the effect of this bill. This government has done it before in B.C. Telephone share acquisitions. They've done it indirectly through ICBC, where they depressed the market and they depressed the value of the small corporations, or anyone who is to be their victim, and then they offer to pay, or if they don't do that, they just take it over.

This Act gives the independent nowhere to go and this is one of their very serious concerns because they will, in effect, by this Act, become contractors to the government with no capital value in their assets. They won't be able to sell out because no one, no other Canadian in their right mind, would come into British Columbia in the uncertain times that are going to be ahead because of this bill, and invest good hard-earned money to become a contractor of the government with no guidelines and no ground rules.

The second reason that they won't be able to sell out, these independents, should they wish to get out from under the thumb of the government, is because they must seek the approval of the Minister before any Canadian buyer can purchase their company. If there was a buyer who is either out of his tree or willing to invest some money for tax purposes in the long-term, it is quite obvious from the Plateau situation and the other situations in this province that this Minister has involved himself in by way of takeover, that no one, no Canadian citizen, would meet the requirements of the Minister. That's why these small independent operators resent the approach that this Minister is taking in meeting their needs.

He has now patched this Bill 171 which is to be used to bring these companies he covets into economic depression so that he can take them over in his own time and on his own terms. For more than four months, this Minister has indulged in artful baiting of the hook, and he has utilized the depression of the world markets as a reason to fool the people into believing that Bill 171 is necessary. He has played on the integrity of the individual sawmill operators in this province. He and the Premier have toured the province, literally stage managing a scenario.

Hon. R.A. Williams: A what?

Mrs. Jordan: Suddenly, out of the blue, this Minister becomes very concerned with meeting with industrial groups. There are press releases — press releases after press releases promising immediate action. They've been coming out for months — immediate action to meet the requests of industry; inferences that the important industry groups wanted log and chip prices fixed by statute; inferences that the independent sawmill operators in this province wanted their chip prices adjusted by statute when, in fact, all they asked the Minister was to use his good office to caution the pulp mill operators that there had to be an adjustment. They didn't ask to sell out their souls, as this Minister is asking in this legislation.

This Minister just had a sudden, new-found concern for small business in this province while at the same time making very sly allegations that big business was bent on extinguishing small business.

The interesting thing in all this, Mr. Speaker, while the Premier and the Minister of Lands, Forests and Water Resources are prancing their way around the province in this scenario, is that the very people he's trying to deceive are not deceived. They know the implications of what the Minister is doing.

Interjection.

Mrs. Jordan: Well, you know, this is the problem with this Minister. He's so tied up in semantics that he doesn't understand the problem of people, and he likes to debate the theories and the vocabularies while the sawmill operators in this province, Mr. Speaker, want to debate their daily problems. They don't want to sell out to this type of super-intellectualism. Most of them are very hard-working individuals.

When we sum this all up, Mr. Speaker, this great act at the time between the Minister of Finance and the Minister of Lands, Forests and Water Resources, we have a ridiculous TV drama of Premier Barrett with his foot on the aircraft that is to wing him to China, which is long before the bill has been introduced to the House, and he says as his farewell shot: "Anyone who opposes this bill is in favour of driving the independent businessman out of the province." Driving the independent businessman out of business! Oh, Mr. Speaker, a very cunning, cunning act — a hard-core socialist revolution by stealth.

You know, when one examines this bill you can see a complete unmasking of the power-hungry rule of the NDP caucus. The people in this province know, the small operators, sawmill operators, the independent operators of this province know, and the media know. Bill 171 is — oddly enough in the Minister's own words — the final batch of eggs in the socialist omelet in this province. It now sets out to

[ Page 4864 ]

launch the people of British Columbia into its latest socialist mess.

I will close by saying to the independent operators out there: don't wait for the $60 chip price to come to every producer across the board. Christmas and Santa Claus, Mr. Speaker, will not be found in the administration of this Minister or in this bill.

Mr. D.A. Anderson (Victoria): Mr. Speaker, I would like to add a few words to this debate. I feel that despite the lack of attention this bill has received by public as well as Members, it is one of the most important pieces of legislation we have discussed since this government took office in 1972, and I am quite sure that they agree with that statement.

I hear, I'm delighted to tell you, Mr. Speaker, agreement from the backbench. At least so far I am in complete accord with the government view on this.

It is of interest that while the Premier is in China listening to the anthem, which is "The East is Red," we have somebody, the Minister here, accused of coming out of the blue with this legislation. I would like to think the colour is much the same, and that the east of the Pacific is also becoming a little redder as a result of this particular piece of legislation.

Interjection.

Mr. D.A. Anderson: Had I only been invited to go to China, Mr. Minister, I might have, but, you know, I never get these invitations.

The bill is essentially a two-part bill. This was outlined by the Member for West Vancouver–Howe Sound (Mr. L.A. Williams). On the one hand you have the section dealing with wood chip prices, referring to the Lieutenant-Governor-in-Council  and in the rest of the bill you have your British Columbia Forest Products Board.

The reason, I think, for these two dissimilar items being placed together is that the section 2 deals with an immediate problem of which Members on all sides of the House have spoken fairly frequently over the last few months, since the late spring and early summer, when this problem began and became acute — namely the problem facing the interior lumber industry. The problem has spread to the coast. It's come to the point now where we have approximately 14,000 to 15,000 members of the IWA and people employed in that industry unemployed. The government is responding with section 2, apparently, to the request for intervention.

This particular aspect, section 2, the third of a page of this bill which deals with that one section, as opposed to the total of the bill which is nine pages long — the bulk of the Minister's speech dealt only with that wood chip problem. It is a real problem. The case of Rim Forest Products has been mentioned already. Rim Forest was forced to close. Others have had troubles in the past, over the last few months.

The interesting thing, Mr. Speaker, is that Rim Forest was dealing with Can-Cel, namely the government Crown corporation, and Can-Cel was known to be about the worst company when it came to paying for chips in the interior. So you have a situation where the government mill was doing its best to do the maximum amount of damage to the independents, and then we have the Minister coming forward today and saying: "In order to curb that, we are going to have to put in a bill, Bill 171, which gives virtually unlimited power to the board and of course, to the cabinet in terms of the pricing provisions in section 2."

Why was it, I wonder, that Can-Cel was the worst company when it came to paying for chips? Why were they paying $ 20.10 per cunit instead of the $60 per cunit talked about by the Minister in his speech? Why, if there was a company whose head office was in the province, closely connected to the government, was that the worst company when it came to paying for the products of these independent mills?

We had, of course, the Minister's statement that it was those foreign companies, those American and even sometimes national Canadian, Toronto-dominated companies, which were bad. But it so happens that, in terms of the problem that be discussed and the problem that he gave as the reason for this total bill, it was Can-Cel, his own company, which was the worst.

I'm reading now from a newspaper clipping dealing with the Rim Forest problem. The headline is: "Disasters Overkill, Close B.C. Mills," by Jim Lyon, Sun business writer. He's quoting Bob Wood, the vice-president of Rim Forest.

"Rim claimed that Can-Cel was only paying $20.10 a cunit for pulp logs, while the actual cost of production was $35. About 20 per cent of Rim's cut was of inferior pulp logs. It was converting 80 per cent of its cut into lumber."

So the real problem you had there was the price being paid by Can-Cel and, of course, the substantial costs incurred by way of stumpage to the company. Lack of working capital was another factor as well. There is no question of that. But the fact is, when we are dealing with the question of price, to which the Minister alluded constantly in his speech, and the need to raise that price, there is no excuse for not going into why Can-Cel itself did nothing to assist the independents when, as the Minister claimed, the local company, the B.C.-owned company, the company with a heart, as he described Can-Cel, allegedly was in a position to give it a lot of help and allegedly wanted to give help.

There's no reason except, of course, that by creating a problem, by making the problem worse, we got in a situation where the excuse for all other sections in addition to section 2 became feasible.

[ Page 4865 ]

Now the Minister spoke at some length about the justification for his move. He mentioned the Pearse report. He failed to mention the qualifications in that report, the provisos that Professor Pearse wrote into that report, dated July 1974. He simply gave what he thought would support his case, and indeed which did. He also mentioned another report, which he tabled at the time — obviously he did not want to have that widely distributed before his speech — a report of the B.C. Research Council.

Now, Mr. Speaker, I've had very little time to look at that report, but I have gone through a few pages. On page 31 would like to quote you some of the things that were said there. This is at the top of page 3, and it says:

"It is estimated that, taking a fairly conservative evaluation, most mills can afford to pay $60 per bone-dry unit, f.o.b. the pulp mill, for chips…" —

and this is capitalized and underlined —

"…in the immediate short term."

Now I wonder why we didn't get that underlined capitalization from the Minister in his speech when he talked about the possibility of paying $60 per bone-dry unit?

On the same page, I continue to quote, Mr. Speaker:

"In fact there is some evidence that prices approaching this have been paid for chips at the coast, although in what quantities is not know. Chip prices in the interior have gone as high as $40 per bone-dry unit in special circumstances, but are generally lower than this."

Then the report of the council goes on to talk about long-term implications, having made it perfectly clear by the capitalization that they are talking about the immediate short-term, they start putting in the qualifications which the Minister himself saw fit to omit in his discussion.

This is on page 3 again:

"Ability to pay a price as high as $60 per bone-dry unit could vanish overnight if prices of pulp and paper products should fall as drastically as other commodities" — for example, copper — "have since last year.

"Ability to pay could also be eroded by steadily rising operating costs."

Point (2) the second proviso:

"Many of the interior mills suffered heavy financial losses, mainly due to low pulp prices in the late 1960s. The present spell of high prices is providing an opportunity for these mills to recoup their losses." — albeit at inflated dollars — "and thus improve the average return on investment over the long term.

"Increases in chip prices, which would drastically reduce or eliminate the opportunity to recover past losses, could have adverse effects on the future investment in this sector of the forest industry."

That problem of backlog of losses over many years of low prices was not talked about by the Minister in his introduction of this bill.

Carrying on, Mr. Speaker, on page 3 the report stresses the need for obtaining data from the industry "on at least a few operating mills in order to validate the results of this and earlier studies." Let me repeat the words, "on at least a few operating mills."

It's clear from that that the council realizes their report was thin, needed substantiation, needed further studies.

"Such checks" — it went on to say — "are particularly important if any significant increases in chip prices are contemplated."

Mr. Speaker, that was on the page dealing with the $60 per bone-dry unit on which the Minister spoke at some length. I think those words are important because they indicate the limitations upon what the Minister put forward in his justification for the bill. On the question of the 20 per cent rate of return — on page 6 of the report, under the heading: revision of Wood Chips and Roundwood Value Estimates, the report goes on to point out:

"Enquiries in the financial community lead us to believe that the 20 per cent rate of return used in 1973 should now be adjusted upward to 25 per cent to reflect both the effects of inflation on the anticipated value of future earnings and the higher interest rates that must be paid on borrowing."

Once again, Mr. Speaker, we heard of that generous 20 per cent, yet the report that the Minister used to justify his legislation and his introduction of this bill talks of raising that still further.

The report refers to the difficulties of the mills that have a mix of newsprint and kraft, and indicates that you cannot average market prices as easily as they would like. They point out that the $60 figure might be fine for the kraft product, but not where you have the mixture of the two products.

I'd like to quote again from the report. Again this is underlined. It says on page 10:

"In the immediate short term, most pulp mills in the province could afford to pay at least $60 per bone-dry unit for wood chips. This estimate is considered conservative since it is somewhat lower than the price that could be afforded by the least profitable mill when a 20 per cent before-tax rate of return is allowed on the total capital investment."

It goes on to say:

"It is interesting to note that coast chip prices have approached the $60 figure recently and some mills reverting to whole log chipping to alleviate a shortage of chips must be incurring cost for chips in this order."

[ Page 4866 ]

Then it goes on to refer to the longer-term implications of increasing chip prices. The words are these:

" It must be stressed that the $60 per bone-dry unit figure would appear sustainable in the immediate short term."

Again, "immediate short term" is underlined.

Everywhere through this report the $60 per the bone-dry unit is qualified by an underlined statement with reference to the short term.

" If the B.C. Forest Service considered action which would cause the price of chips to rise substantially above present levels on a continuing basis the following longer-term considerations should be taken into account." I'd like just to read the first of these long-term considerations which the Minister saw fit to ignore.

"Any mechanism used to increase chip prices would have to be responsive to changes in market prices for end product as well as to increases in operating costs.

" The fact that market prices for pulp and paper products are currently at such high levels is no guarantee that they will not come down again. The weakening U.S. economy has already caused some commodities, for example, copper, to fall drastically below last year's level.

"A comparison with figure 2(b) with figure 3(c) of volume 1, both at 16 per cent return, shows that due to operating cost increases the break even market prices have risen roughly $25 per ton since 1973."

In other words, prices do not have to fall back to the levels of one-and-a-half years or two years ago before some mills would experience financial difficulties.

For example, an interior mill which could have afforded $32 per bone-dry unit for chips, when bleach kraft pulp was at an excellent price of $210 per ton in mid-1973, could only afford $25 per bone-dry unit if prices fall to the same level today.

The final quote from that report is on page 13 where it says that this is tentative, and that things could change very quickly. It says: "It is quite possible that the results in this report could be outdated in a matter of days."

Mr. Speaker, I think I have shown that in the reports which were so confidently referred to by the Minister there are a large number of provisos, a large number of statements which hedge the conclusions he put forward.

I think it's a pity that this report, which according to the Minister was available getting on for a year ago, was not made public sooner. It's a pity because the report should have been the basis for a fairly detailed examination of this legislation. Because it was only put forward for our examination earlier today, we can only give it the most cursory examination and the most cursory use in this debate.

Mr. Speaker, I'd like to talk a moment or two about the other sections of the bill, other than section 2. It seems to me that the Minister is taking in this legislation something which we have complained about before — we've complained frequently, but it doesn't make it any less true if we complain about it today — that is this sweeping power we find to make regulations on just about anything they please.

The control given in this legislature is sweeping. Section 19 which simply says: "The Lieutenant-Governor-in-Council may make regulations," gives them a carte blanche to do what they like.

I'd like to refer to what the objectives of such a piece of legislation could be. What is the principle of it? What are the objectives? I do this because when you write legislation of this nature, which is vague in intent, which is vague in wording, which simply gives total power to deal with just about any question respecting the forest industry, when you grant total power to do just about anything, when you have the financial provisions of this legislation, such as it is unlikely there will be legislative scrutiny of the moneys spent, you have to look behind it and try to find out what it really is there for.

There's no question that the problem in chip prices, the problem of the interior mills, the problem .of the lumber markets in the United States, is just a convenient peg taken care of in section 2, and the other sections are the ones which the Minister really wants to have.

[Mr. Dent in the chair.]

The Minister was responsible for a report to the 1971 NDP policy convention — a report which was rejected because there was references to co-participation with private firms. In other words, the report was rejected by the convention because it was not radical enough.

I would just like to read you one or two things from that report. Under the natural resources (4): "The NDP places major industries such as pulp, paper, lumber, mining manufacturing, transportation, communications and finance under public ownership." I believe this type of legislation gives a great vehicle to implement that particular point which was recommended by the Minister at that NDP convention in 1971. It makes it possible for the government to embark upon the type of control, the type of manipulation which would lead it to reduce the value of companies in the private sector by manipulation, just as was proposed in that background paper, in that resource policy paper.

It's not a long document and I won't read very much of it -it's not a long document but it clearly states: "that they want to take over for public

[ Page 4867 ]

ownership, pulp, paper, lumber, mining, manufacturing, transportation, communications and finance." Pretty well the whole thing, and among the methods to achieve that, of course, to make it possible to do so, they're going to have to lower the value of the companies involved in these industrial areas so that the public sector can pay for them.

The quote I'd like to give you, Mr. Speaker, is that: "The acquisition of privately-owned corporations in the resource fields, prior to major resource tax changes, would be a mistake because the market price of those companies would be grossly inflated," et cetera, et cetera. "Any acquisition of those corporations prior to substantial tax change would be a mis-allocation of public funds."

Well, Mr. Speaker, not only does the government have the power to make the tax changes, but now they've got the power to make all the price changes they need to achieve the same objective. When that is tied in with the point that I gave you — the policy point that I gave you — which occurs on the following page, and which lists the major industries of pulp and paper and lumber first among those which are to be taken over under public ownership, it is clear we have in this legislation a vehicle to implement party policy in a way which I think would be detrimental to the province. I think it most unfortunate, indeed quite reprehensible, that this has not been discussed by the Minister in the Legislature today.

What he has stated previously has indicated clearly his policy objective. He's put that down. He's listed what he wants to do. In this legislation, tied to the somewhat flimsy excuse of the present difficulties of the interior lumber market, he gives himself the vehicle to do just about anything he wants. Yet in introducing this bill, and in the discussion we've had from other government Members, we have had no examination, no clear analysis of why these powers are needed; why it is essential for the government to be able to have this total control which exists in Bill 171.

Mr. Speaker, if we in this Legislature, government backbenchers as well as opposition Members — all those indeed who are not privy to the cabinet secrets on a day-to-day basis — if we are to discuss intelligently legislation put before us, we're going to have to know either the fine print of all the legislation, in other words, so we can discuss detail in the bill itself, or we're going to have to know what the government intends to do with the very, very broad legislation that they've brought in.

We have statements made by the Minister. Statements indicating his position. Statements indicating his objective. Statements indicating his belief. We have legislation here which makes it possible, totally possible without any further legislative examination or checks, for him to implement those policies, those ideas and those beliefs, and yet we've not had one word from him. We've not had one word from any other Member of the government except to pooh-pooh the suggestion that it might be used in this way.

Given no other explanation by the government, we can only do them the courtesy of suggesting to them, Mr. Speaker, that what they've said they'll do, they intend to do, and what they've said they'll do is contained in that policy document of '71 and certainly has not been contained in any speech tonight, or previously by the Minister.

I find it sad, Mr. Speaker, that we constantly get legislation of this nature, capable of just about any interpretation, and a total reply of the government is "Trust us." In this case it's "Trust me." That's the only thing they can offer as a protection to the public. "Well, our hearts are pure, therefore trust us."

Well, we would like to see legislation which is clear and specific. We're not getting it, therefore if we're to get general legislation we would at least like candid statements by Ministers as to intention. We're not getting that either, and it's for reasons such as this that it's quite impossible for us to support this bill, however much we, and other Members of this House, might wish to help interior lumber producers.

Mr. J.R. Chabot (Columbia River): Bill 171, The Timber Products Stabilization Act, indicates to me very clearly that Big Brother government moves in again. Big Brother government moves in again. Another piece of take-over legislation by that government supposedly to help the comrades out there in the hinterlands of the province.

What the bill does, of course, what the bill attempts to do, is create a wedge between the small independent operators and the large integrated operators. There is very little doubt that sections in the legislation was introduced for that very purpose.

The old ploy — the old ploy "divide and conquer," that's the approach that's being taken, on the guise that this government cares about the little independent operator. That it cares.

It wasn't too long ago, Mr. Speaker, when that government over there introduced a bill — not Bill 171 but Bill 71 — on the pretext that they're going to get revenge against the big corporations that weren't paying their fair share of taxes in this province. You know who that hurt worst: every small independent merchant and businessman in this province, and that could quite conceivably be the ultimate result of this bill which we are debating right now, Mr. Speaker. It certainly could be.

Oh, yes, they're going to help the little independents. They helped them with Bill 71 all right. Are they going to do the same hatchet-job on them with Bill 171, Mr. Speaker?

I can't understand how the Minister can stand in

[ Page 4868 ]

his place and say that he is out to help the little independents, when this very piece of legislation we're discussing takes their independence away from them. It absolutely gives the Minister carte blanche to take the independence away from these small independent operators that he says he's out to help.

This afternoon, Mr. Speaker, I went through a file and I found 10 commandments that made me think of this legislation, and these commandments were put together in 1848 by Karl Marx, and it was the way to turn a free nation into a communist society.

Mr. Cummings: Are you related to Harpo?

Mr. Chabot: One of these commandments…. It's clearly related. It can be clearly tied, or allied with this piece of legislation we have.

Commandment number one is the abolition of property and land, and application of all rents of land to public purposes. We've seen commandment number one started upon by that government over there with Bill 42, and now they move on. They didn't go through all the commandments.

Now they're down to commandment number seven.

Mr. Steves: Have you got a copy so we'll know what the others are?

Mr. Chabot: Well, the Member for Richmond (Mr. Steves) says: "Give us a copy." I'm sure if he goes in his file he has several copies of this and other sayings from Karl Marx as well.

But commandment number seven talks about the extension of factories as instruments of production owned by the state.

Implementing these 10 commandments of Karl Marx appears to be the direction this government is taking by the introduction of this piece of legislation. They talk in the election of 1972 in The Democrat about: "An economy for people. As an immediate step an NDP government will introduce a Resource Companies Information Act." It says: "We're going to take an immediate step." Well, they haven't taken that "immediate step." It's taken them almost two years. It's taken them two years, Mr. Speaker, to implement the substance of the Resource Companies Information Act, and this Act is to ensure full financial disclosure by resource firms. "The Act will provide the information needed to significantly increase revenues from our resources."

Well, we see that they haven't implemented that Act, but the provisions which they outlined in their so-called "new deal" are clearly embodied in Bill 171, Mr. Speaker.

I'll never forget this is the government that claims it cares about little people. About the little people. It cares about little people, and the Minister of Transportation and Communications (Hon. Mr. Strachan) in the spring of 1973 made a statement to the Legislature, in an attack against the private forest companies of this province. He stated that the forest companies were criminally irresponsible for the price they were charging for their lumber in British Columbia. That there should be a new price system in this province, and that these companies should stop gouging British Columbians.

Now we have the evidence that this government over here, through its Crown corporations and its investments, its 79 per cent investment in Can-Cel, had an opportunity to stop this kind of criminal irresponsibility, as stated by the Minister of Transport and Communications (Hon. Mr. Strachan). Well, what have they done? They haven't helped the little fellow to buy his lumber any cheaper through Plateau Mills, Kootenay Forest Products, or through Can-Cel. They have continued the policy of the other foreign companies. They charge the going rate and say that they can. Mr. Speaker, you can't have it both ways. You can't be as inconsistent as that government is with their statements and their actions. They talk big on behalf of people, but they do little, Mr. Speaker.

The Minister this afternoon talked about Can-Cel, that great, responsible, corporate corporation. He talked about Kootenay Forest Products, that there had been no layoffs. Oh, it's a great corporate citizen, Mr. Speaker, a great corporate citizen. You know, this government has an endless supply of money, which might be a little different situation with the private companies that might have to borrow in a tight money situation at exorbitant rates. But it has no qualms, Mr. Speaker, about overruns.

Everybody in this province knows about the $103 million overrun in welfare. Is that why they're going to run the Crown corporations, Kootenay Forest Products and Plateau Mills as well — with overruns on the credit of the province? I want to assure you that the small independent operators don't have access to the buckets of money that this government has. I want to tell you that they have a responsibility to manage their companies. They can't practise the waste and extravagance that we've seen displayed by that government since they've been in office, Mr. Speaker.

While the Minister is in the process of tabling reports and studies on chip prices, maybe this is a good time to table the report, the study, on the trading of shares in Can-Cel prior to its takeover. When are you going to table that report, Mr. Minister?

He says it's not his responsibility. Well, it's the government's responsibility to tell us what took place in the trading of shares in Can-Cel.

DEPUTY SPEAKER: Order, please! Would the Hon. Member return to the principle of the bill,

[ Page 4869 ]

please?

Mr. Phillips: Royal commission.

Mr. Chabot: Certainly, Mr. Speaker, I was talking about the Can-Cel operation and its corporate responsibilities, how it treats people.

Mr. Cummings: Let's get a royal commission on forestry. Yes, that's a good idea. Let's open it up.

An Hon. Member: Where's your Swiss bank account?

An Hon. Member: Why don't you go live in your ice cream?

Mr. Chabot: He talked about the statement from Cariboo Pulp and Paper in which they've decided, because of the actions of this government in the introduction of Bill 171, that they are going to cease, or not proceed with a $140 million expansion at Quesnel.

Interjection.

Mr. Chabot: Well, certainly they were in the process of certain studies, economic studies, no doubt to justify…. They've decided that they weren't going to proceed. If you don't know what's going on, maybe you've never invited them in to your office. Maybe you've been hiding too much, Mr. Minister. Maybe you've been hiding, as you generally are, in your office behind your reports.

Mr. Phillips: With his board feet.

Deputy Speaker: Order, please. Would the Hon. Member address the Chair, and would the Hon. Minister not interrupt the Speaker?

Mr. Chabot: The Minister in his reply says that the money will come from somewhere else. What kind of nonsense is this? Is he suggesting that the money will come from the government, that the money will come through this new Bill 171 which we're presently debating? Are they going to put an addition on Cariboo Pulp and Paper? They don't own Cariboo Pulp and Paper. What kind of nonsense is that Minister talking? Who in his right mind would invest five cents in the forest industry of British Columbia today with this bill?

Mr. Lewis: I would.

Mr. Chabot: Well, you're not in your right mind, Mr. Member for Shuswap, then. You're not in your right mind.

What forest company will invest in expansion of their existing operation in British Columbia after this bill is introduced, Mr. Speaker? No one. Investment will come to a standstill in the forest industry of this province because of this legislation. And the government says again that it cares about little people. What about the little people who have invested their dollars, their life savings, in some of the larger, stable forest companies in this province and who depend upon the dividends as a fixed income over and above the old age pension, Mr. Speaker?

Does this government care about those small investors who have invested in the large forest companies of this province? It's quite obvious by this legislation that they don't care, because they've depreciated the value substantially of those shares by the introduction of this bill, and they're in the process of challenging the dividends to these very people who are on fixed incomes as well, and they say that this is a government that cares. This is a callous, indifferent government to the wishes of the people.

The poorest investment anybody could make today in British Columbia is buying shares of any forest company in this province. That is the poorest investment, because of the introduction of this legislation.

Interjections.

Mr. Chabot: When the expansion doesn't take place, Mr. Speaker, because of the uncertainty created by the introduction of this legislation, and because of the many irresponsible statements made by that Minister and the irresponsible statements made by the Premier as well, regarding the forest industry since they've been in office, who will invest in the forest industry of this province? No one, Mr. Speaker, no one, because of the lack of confidence in this government over here, which has created the chaos which presently exists in the forest industry.

You know what they'll do, Mr. Speaker? If there is no expansion, no doubt, in the forest industry, they'll say the private sector isn't capable of fulfilling its responsibility and that there's a need for the Crown, the B.C.-Forest Products Board, to get involved with investments in the forest industry. They'll move in to fill the vacuum, the chaos, created by that government over there, Mr. Speaker.

Hon. W.S. King (Minister Of Labour): You should have been leader.

Mr. Chabot: I mentioned to the Member for Skeena (Mr. Dent) this afternoon. You know, he didn't really tell all the facts about Rim Forest Products. He talked a little bit about his support of this legislation and I'll tell you that the people up in Skeena will remember that Member in the next

[ Page 4870 ]

election. They'll remember him for his lack of action and for the lack of concern by that Minister for those people in Hazelton as well.

Do you know, Mr. Speaker, that Rim Forest Products was put into receivership by the action of your government? They caused the problem of Rim Forest Products — that Minister over there and that government. There are only four Ministers in the House right now — the rest are either in China or Timbuktu — they're travelling somewhere around the world. They suggest, Mr. Speaker, with that 79 per cent investment in Can-Cel, they try to suggest that they're good corporate citizens when they bragged…. The Minister has the gall to brag about the profit of Can-Cel, which was made off the sweat and the backs of the small operators in the north. That's how they made their profit -by bleeding the small independent operators in the north, by ripping off Rim Forest Products with unrealistic payment for chips, and the Minister says he cares.

It's the actions of that government, Mr. Speaker, that caused the problems with Rim Forest Products, and the Minister knows it full well. Off the sweat of the backs of the little operators in the north, Can-Cel has made a profit — Can-Cel, that supposedly responsible corporate citizen in the north, off the back of every little operator in that part of the country.

An Hon. Member: Shame on you! Hang your heads in shame, the whole bunch of you.

Mr. Chabot: Mr. Speaker, when I look at this legislation, I can't…well, I guess I can expect it from a government like we have across the way. They are passing legislation that makes provision for the appointment of additional friends.

Interjections.

Mr. Chabot: You don't understand….

Deputy Speaker: Order, please!

Mr. Chabot: It makes provision for the appointment of more socialist hacks.

I suggested at the time of the superboard that there was a possibility that Frank Howard might be appointed to the superboard. I didn't say emphatically that that's where he would go, but I said he'd be glad to go on that board or another well-paying board.

And I've finally found the board where Frank Howard will be appointed. He's going on this board — on the B.C. Forest Products Board. They've found a job for Frank Howard at last.

Mr. Speaker, the more we look at this piece of legislation and other pieces introduced by this government, it's quite obvious that this is a province that is run by boards. An ever-increasing number of boards are being appointed, Mr. Speaker. We've seen two boards during this session that will cost the taxpayer a bundle, Mr. Speaker.

Interjections.

Mr. Chabot: Mr. Speaker, you know, with the appointment of these boards with all their powers it's quite obvious that this Legislature is losing its significance. You might as well call this the jawbone society because our powers of scrutiny and control over the public purse are being denied, are being taken away from us….

Interjection.

Mr. Chabot: Yes, being eroded, the Member for Saanich (Mr. Curtis) said — certainly.

And no longer will there be a need for a Legislature because this province appears headed for hidden management by boards, friends of the government managing these boards.

Mr. Phillips: He's the Minister of Economic Decline.

Interjections.

Deputy Speaker: Order, please!

Mr. Chabot: The Minister is chit-chatting from out of his seat. I'm surprised that he's not over in China instead of the other Member for Vancouver Centre (Mr. Barnes) because he's the Minister of Economic Development and I'm really surprised.

The Member for West Vancouver–Howe Sound (Mr. L.A. Williams) this afternoon put it very effectively when he said: "Economic development is d — e — d in this province." D — e — d. It's dead, with a Minister who doesn't care about the export of our forest products to China because he's not on the trip.

His colleague for Vancouver Centre was given his turn — he's been getting a little rowdy and restless in the caucus. It was time to give him a trip to put him back in order.

You've gone to Japan, Mr. Minister. He's gone to Japan; he's had his trip, Mr. Speaker.

An Hon. Member: Can I get you some more water?

Mr. Chabot: I don't know when your trip is coming up but I would think all you have to do is get a little ronky in the caucus, Mr. Speaker….

An Hon. Member: What? Get a little what? Get

[ Page 4871 ]

a little what? (Laughter.)

Mr. Chabot:…and then they'll give you a trip as well.

You know, this bill also, Mr. Speaker, effectively destroys the effectiveness of the B.C. Forest Service. The B.C. Forest Service has become nothing but a gatherer of papers for the B.C. Forest Products Board and this destroys the effectiveness of the B.C. Forest Service, there's no doubt about it.

The government has failed; the government didn't need to bring in a piece of legislation such as this to ensure a fair return for chips. That is not what this bill is all about. That's all the Minister would talk about. He didn't want to talk about the rest of this bill and its powers — its broad powers.

He didn't have to go this route.

This is a bill, Mr. Speaker, that guts the private forest sector of this province; this is a bill that guts this Legislature; this is a bill that guts contracts as well; this is a bill, Mr. Speaker, that I'm sorry we're debating because I don't believe that a bill such as this belongs in a free democratic society.

Mr. Speaker, this is a bill that obviously from my remarks you've come to the conclusion that I can't support.

Mr. D.T. Kelly (Omineca): Mr. Speaker, thank you very much. I rise to say a few words to support the bill — our new Bill 171.

As you know, I represent and live in the central part of this province and represent the people of Omineca, which is heavily related to the forest industry.

Mr. Chabot: You're a one-timer too. You won't be back.

Mr. Kelly: Mr. Speaker, I can see the reason — I certainly see the reason for having to introduce a bill such as this particular bill — the Timber Products Stabilization Act. Because, Mr. Speaker, it wasn't too many years ago that I had an altercation with the former forest branch of the Province of British Columbia.

I actually took them on single-handed in attempting to stop a log drive on the Stellako River. Mr. Speaker, you know that that board's branch was actually breaking the law of the day. Do you know why? Because they had no Act to act under so that they could indeed carry out what they intended to do.

They actually had to break the law to try and carry out the log drive on the Stellako River, and you know, there was so much publicity created through that particular log drive on the Stellako that indeed there has been no log drive since. Such public sentiment had been created against the forest branch and the then government of the Province of British Columbia because of an inefficient Act that they had to actually go out and break the law.

That was the course of the Social Credit government of the day. That was in 1966-67 — '67 was the year that we finalized the last log drive on the Stellako.

Hon. Mr. Lauk: That's why Cyril isn't here today.

Mr. Kelly: I live in an area where there are — or there were — many small sawmills and where there are still a few private entrepreneurs in the sawmilling industry. But, you know, they have never been so insecure as they have been in the last few years because in the last few years, Mr. Member, do you know what? There is not a decent forest policy in this province.

I congratulate the Minister for bringing forth this bill….

Some Hon. Members: Oh, oh!

An Hon. Member: Don't shout.

Mr. Kelly: …to protect the sawmillers — the private people in the sawmilling industry.

Interjections.

Mr. Kelly: I don't talk about MacMillan Bloedel; I don't talk about the big corporate people — I'm talking about the small sawmillers, the small companies, the small people that need some protection — that never had any protection.

An Hon. Member: You don't know your own bill.

Mr. Kelly: You know, even….

DEPUTY SPEAKER: Order, please!

Mr. Kelly: Even Plateau Sawmills is not a large company — I think you will recognize that, Hon. Members. And even they need protection.

But you know, isn't it odd that here's this sawmill right in the midst of a recession in the forest industry, and yet they are operating at full blast. So really, if you want to operate a sawmill, it can be operated if it's operated efficiently and with the kind of people that are dedicated to that type of industry instead of to make a dollar to take across the border or to take to some foreign city — maybe Toronto, or in New York.

Some Hon. Members: Oh, oh!

[ Page 4872 ]

Mr. Kelly: Or even….

Mr. Phillips: What about Tokyo or Peking?

Mr. Kelly: Well, it could be Tokyo, too. But I happen to know that one of the multi-national corporations that is heavily in the industry in northern British Columbia is based in Toronto, and I say that when things get tough — going tough for them…

Interjections.

DEPUTY SPEAKER: Order, please!

Mr. Kelly: …that they indeed don't think about the workers in the fields or in their sawmills. When things get a little tough, they close it down.

Interjection.

Mr. Kelly: Well, they're still working, Madam Member, and that's the main thing.

Now I would like to take issue with the words of the Member for North Okanagan (Mrs. Jordan). She said that we, were fooling the people because there were sets of figures that the public wouldn't understand. Those figures, of course, are the difference between the price of a unit of chips at the sawmill and the price of a unit of chips delivered to that pulpmill.

The chips by a bone-dry unit at Plateau Sawmills about two weeks ago were worth $17.40 per BDU. The trucking contractor receives $8.35 per unit for delivery of those chips to the mill, making them worth just a little over $25 — in fact, $25.75 per unit delivered to the pulp mill. So when you're looking at the overall price involved, really there is a tremendous spread. And, after all, the $17.40 is money that is being received today for chips that certainly wasn't being received a few years ago.

So there is a great degree of profit to be made in the chip business if, indeed, there is a decent price for those chips.

Everybody says that there's nobody wanting to get into the sawmilling industry. I know of several organizations that are anxious to get into the sawmilling industry. In north-central British Columbia there certainly are. I know that there are quite a few people at the Minister's door applying for timber to go into the industry. That's quite a change of story from where everybody is leaving the country, taking their dollars over the border. Yet we have people in that area clamouring to get into the industry. But how about the small sawmiller? I am attempting, and have been attempting for weeks, to get timber for those small sawmillers, because they want to go into business.

It's a different story when you tell me that everybody is running across the border, taking their investment dollars across the line and leaving us in a terrible plight up here. That is not true. There are people who do want to invest in British Columbia, and that's in the sawmilling industry too. As far as the man or the company leaving the Quesnel area is concerned, those were only figures. It's all very well to bring a set of figures to this House and say that somebody had just left because of this bill being introduced. The fact remains that it's been a very lucrative business.

Mr. A.V. Fraser (Cariboo): The president of the company says it.

[Mr. Speaker in the chair.]

Mr. Kelly: It's been almost like a combine. And no wonder, no wonder the pulp mills didn't want to pay any more money. They were making money in the hundreds of millions for these last two years.

I talked to a gentleman tonight that is trucking chips into a pulp mill. He is anxious, of course, to know how the bill is going in terms of what his new contract might be for trucking. But when he's looking at 50 or 75 cents per unit as an increase on his present rates, he says that he will make money.

Mr. Phillips: That's insurance rates.

Mr. Kelly: No, trucking rates, trucking rates.

Indeed, he will make money. So the spread in the overall situation is not so great. In fact, there is a good profit allowable for the companies manufacturing the chips.

We also have several chip mills set up in the Burns Lake area now. And we have several people — when I say people, that is heads of companies — who are prepared to invest money in the chip industry where they can use the hardwoods to try to get that part of the industry expanded. I'm anxious to see that industry expand because, of course, there are tremendous reserves of hardwood in the western part of Omineca riding.

This previous administration, I think, just didn't have the kind of teeth that were necessary to really run the forest branch in a fashion that they would need to do a good job.

It's unfortunate, because indeed the industry is the No. 1 industry in the province, and it still will be. I really believe that conditions will straighten out in the not too distant future. I think that the things that have happened in the last few days, especially in the United States and in Canada, will certainly give relief to our industry. The logging contractors have gone back to work in my home town, and several of those are friends of mine. I am communicating with them

[ Page 4873 ]

on a day-to-day basis. There is one thing that is very important, and that is that a government, no matter who that government may be, should indeed have legislation and policies available that when they want to introduce a programme, indeed, they can do it without running into all the backlash that you usually get from normally poorly formed legislation.

Mr. Speaker, I am only too proud to support this legislation. Thank you very much.

Mr. Phillips: Mr. Speaker, it certainly gives me a great deal of pleasure to stand in this Legislature and fight this takeover legislative measure which the Minister of Lands, Forests and Water Resources has unveiled here this afternoon.

Interjection.

Mr. Phillips: I know it doesn't give the Minister of Economic Development a pleasure, because he's wrongly named in the first place. It's the department of economic decline in the Province of British Columbia.

But it's amazing, Mr. Speaker,….

Hon. Mr. Lauk: Table your speech.

Mr. Phillips: You know the old song and dance we used to hear from the socialists that they were going to listen. No longer do they listen, and they certainly didn't listen to the industry before bringing in this legislative measure. As a matter of fact, Mr. Speaker, I would say that the Minister of Lands, Forests and Water Resources has had his ears closed for the last two-and-a-half years. And he had his ears closed last spring when we in the opposition advised him of what was happening. I know the Minister….

Interjection.

Mr. Phillips: No, he's not leaving, but he might as well leave because at times tonight there have only been four cabinet Ministers in the House — and sometimes only seven Members. The cabinet benches are empty. The Premier and his entourage are over in a tour of China. Five other cabinet Ministers are over on the mainland.

Interjections.

Mr. Phillips: Well, you have your fun. It may be funny to you that half of the cabinet or three-quarters of the cabinet have taken off. Poor planning. The same as this bill, Mr. Speaker; it is poor planning, very poor planning.

That great Minister of Lands, Forests and Water Resources, who is actually the powerhouse in the cabinet, the man that makes the caucus tremble when he walks in, the man that makes the ears perk up of all the other cabinet Ministers when he walks into a cabinet meeting, is having his day in court, Mr. Speaker. Finally, he's got his opportunity to take that big swipe at what he calls big business in the Province of British Colombia.

I hope, now that he's been given the sword by this Legislature to cut up one of the finest forest industries of any place in the whole world….

Interjections.

Mr. Phillips: Yes, I know all about the sawmills that are closing down, and we warned you in the spring session of what was happening in the forest industry, Mr. Minister of Transport and Communications (Hon. Mr. Strachan) in charge of Icky-Bicky and Moscow mutual. If all of the other cabinet Ministers run their departments the way you do, the government would be in worse shape than it is tonight, if it were possible. If it were possible.

This Bill 171, gives that Minister of Lands, Forests and Water Resources the sword that he has been asking for.

This Bill 171 gives the Minister the sword he has been asking for to cut up the big guys in the forest industry, to cut to shreds the greatest industry of any province in Canada, the greatest forest industry of any place in the world, the forest industry that paid more taxes and returned more revenue to the people of this province than any forest industry anywhere, a forest industry that puts millions and millions of tax dollars into the kitty, millions of tax dollars that that government has squandered and wasted.

Now, Mr. Speaker, he chooses, through this bill, to carve up the very industry that brought stability and economic development to this great province of ours. The Premier said, "No," he said, "No, my friends, we're not going to kill the goose that laid the golden egg. Oh, no." But that was two and a half years ago. "Oh, no. We're not going to kill the goose that laid the golden egg."

But this very bill is going to kill that goose. Then the Minister of Lands, Forests and Water Resources, with that sword that he has been given by this bill, is going to carve up that goose and there will be nothing left but economic chaos and economic decline in the Province of British Columbia.

An Hon. Member: Doom and gloom!

Mr. Phillips: No, I'm not speaking doom and gloom. We weren't speaking doom and gloom when we advised the Minister in the spring session of the problems that were around the corner in the forest industry. We also advised that very same Minister that he couldn't anticipate another year like 1973 when the world demand for lumber was the highest that

[ Page 4874 ]

had ever been known in the history of this province or when the prices for lumber were higher than they have ever been in the history of this province.

We warned that Minister that there were problems; we warned that government not to go on a spending spree as they have done. This is a cyclical industry and it has its ups and downs. Now this year, Mr. Speaker, the industry is having its downs. And while the industry is down and there are problems of a crisis nature, this Minister chooses, while the industry is weakened, to move in with the final blow and bring it to its knees, Yes, Mr. Speaker, we warned the Minister what would happen but he chose to not listen. He chose, as usual, and following the rest of the cabinet Ministers, not to listen. He allowed this….

Interjection.

Mr. Phillips: Oh, the Minister of Mines and Petroleum Resources (Hon. Mr. Nimsick) says no. He doesn't only not listen but he can't even see the problems that he has created in his department.

Now no longer do we hear the cry, "Trust us." No longer do we hear the government cabinet Ministers say, "We are ready to listen." No, as a matter of fact, they don't listen to anyone. They have it all written in the Waffle Manifesto, the whole theory. And as legislation comes into this chamber, like Bill 171, the principle of which is to take over the forest industry, the tale becomes true, the tale that we have been telling the people of British Columbia for two and a half years.

Oh, yes, we were right on. We were right on when we said that this government planned to take over the forest industry. We were right on when we told the people of this province that the Minister of Mines and Petroleum Products would ruin the mining industry of this province. And it is happening today.

While on one hand the Minister of Economic Development (Hon. Mr. Lauk) tootles off to Japan to try and invest money, this Minister of Lands, Forests and Water Resources and the Minister of Mines shut the door and slam the door on his fingers. How, how, in heaven's name, Mr. Speaker….

Interjection.

Mr. Phillips: I certainly do mean it. And you know full well that I mean it. But you have a closed mind, Mr. Minister of Mines.

Here we have the great Godfather in the cabinet and in the caucus bringing in his final bill, the final blow to the forest industry. That Minister with an iron fist; he rules cabinet with an iron fist. He is really the man in power in the cabinet; he is the man who makes the other caucus members shudder with fear. He's the power broker. He's the Godfather. He's the man who rules with the iron fist.

And as usual, Mr. Speaker, we have another case here of overkill. Certainly there are problems in the forest industry. Certainly the small lumber operators and the small lumber mills have problems. Certainly the price for wood chips needs to be revised. Certainly it does. But to correct that situation, Mr. Speaker, we didn't need the overkill that we are seeing in this bill. This is an overkill.

Surely to goodness, the Minister and the rest of the cabinet should understand that the people of this province no longer support their policies. They got in with a slim majority and they were not given the power to kill the economics of this province. And the people spoke in the federal election when they rejected the NDP federal candidates. That was a backlash against NDP policies in this province.

Hon. R.A. Williams: What about the Socred candidates?

Mr. Phillips: That was a backlash against NDP policies in this province. A definite backlash. And we saw the same thing happen last Saturday when NDP candidates in municipal elections went down to defeat. Why, Mr. Speaker? Because the people of this province are not buying the policies of this government.

Why does the cabinet not listen? Why have they turned a deaf ear? Why is this government which was going to have an open mind, that government which said, "We will listen," that government which said, "Trust us," no longer listening? I'll tell you, the people of this province no longer trust them. And yet that Minister, that Godfather over there, the man with the iron fist rushes onward to kill one of the greatest forest industries that has ever been in any jurisdiction.

No, Mr. Speaker, let me tell you this: the majority of the voters in this province are not silent. No, the fact is that the government just doesn't listen any longer to the people of this province. No, I tell you, they are not silent. They are not silent when they get into those ballot boxes. Witness the last two elections — the federal election and the municipal elections on Saturday. No, the voters in this province are not silent at all. But it is unfortunate that we have to go to the very depths of economic despair in this province in the four years while this socialist government is in power. Why do they have to ruin the economic base that was one of the finest economic bases in any jurisdiction anywhere in the world?

What is this bill going to do in its full implementation? It will present the government with one of the great conflicts of interest that any business or any government has ever had in Canada. They will not only be the judge; they will be the jury. They will be the lawyers; they will make all the rules as they go

[ Page 4875 ]

along.

Yet our Minister of Economic Development (Hon. Mr. Lauk), who must have trouble sleeping at night who wants to bring secondary industry into this province, is trying to invite risk capital into this province on the one hand, while the Minister of Mines and Petroleum Resources (Hon. Mr. Nimsick) and the Minister of Lands, Forests and Water Resources (Hon. R.A. Williams) turns a deaf ear and kicks the bearers of that capital right in the teeth.

How can the Minister of Economic Development justify inviting capital into this province when that capital that came here years ago when they thought they were assured of a new economic future in this province, and now find the economic climate has changed? And these foreign investors recognize that the climate has changed.

As I said, liquid capital, liquid cash, is the most nervous money there is in the world. Nervous money goes to a secure base. And that nervous money, that investment money, certainly, will not come to British Columbia with the threat of this government and takeover bills hanging over their heads.

When the Minister introduced this legislation this afternoon he said that it was the most important legislative measure to be introduced during this session. Yet he chose to hold on to that bill for two solid weeks while this session was in progress. Two solid weeks he held on to that bill.

Hon. R.A. Williams: You were busy talking.

Mr. Phillips: Oh, we were busy talking. He wanted the crisis to grow worse than it was. He wanted to create that crisis so that he could bring in and justify this double-barreled legislative measure.

When we arrived in Victoria, Mr. Speaker, as you well know, the first day of the Legislature we sat for approximately 45 minutes. That Minister had that bill at that time. Why was he hiding it? Why was he holding it back? Why was this bill brought in in the dying days of this session? I'll tell you why, Mr. Speaker, because he wants this bill swept under the rug. He doesn't want any time lapse between the time the bill is debated and rammed through second reading, because he doesn't want the people of this province to know the true intent behind Bill 171. That's why….

Interjection.

Mr. Phillips: That's exactly what the Member for Dewdney (Mr. Rolston) would want, because he's one of the Members in this Legislature who voted in the dying days of the spring session to kill democracy. Oh, that great defender of the right. What a phony Member!

Mr. Speaker: Order, please.

Mr. Phillips: He talks out of both sides of his mouth at once. Doesn't mean what he says.

Mr. Speaker: Order! Would the Hon. Member withdraw the expression "phony Member"? I don't think he'd want it used on himself.

Mr. Phillips: I'll withdraw if….

Mr. Speaker: I said I don't think he would want it used on himself. And if he doesn't want it used on himself, he should not use it on other Members. That's an elementary parliamentary rule.

Mr. Phillips: I don't need a lecture; I've withdrawn it.

Mr. Speaker: Thank you.

Mr. Phillips: His policies are phony, that's what they are. His policies are phony. He speaks out of both sides of his mouth. He should hang his head in shame.

Why, Mr. Speaker, was this bill introduced so late? Another ramrod tactic, typical of the ramrod tactics used by this Minister of Lands, Forests and Water Resources.

Who's leading the House tonight, by the way? Would you accept a motion to adjourn?

Mr. Phillips moves adjournment of the debate.

Motion approved.

Hon. Mr. Hall moves adjournment of the House.

Motion approved.

The House adjourned at 10:59 p.m.