CONTENTS

Speaker's ruling Accuracy of facts in question period — 381

Routine proceedings

Budget debate (amendment)

The House met at 8:30 p.m.

MR. SPEAKER: Hon. Members, I was asked to look up the question of what is contained in questions in question period. Just briefly, I would say that May clearly sets out that questions should be of a nature that the Member asking them takes responsibility for what is said actually in his question. One can see in a serious case where it might, of course, lead to some action by the government. But other than, say, an inquiry or a committee appointed to look into the facts and the allegations, it would not really be a question of privilege because it wouldn't bear upon the Members' rights in the House, although it might contain allegations against the government or against a Crown corporation. Neither of those are fields in which privilege develops.

However, I think in fairness to everyone, wherever there is an allegation contained in a question, it would be better that the Hon. Member concerned check the facts himself before making a statement.

The House has said on various occasions in Britain — one case that I've seen there, and it's referred to in May — where the Member said: "May I ask, Mr. Speaker, that you would call the attention of the Hon. Member to the fact that he has responsibility for the statements in the questions. You will recollect that the Civil Lord of the Admiralty has denied the accuracy of the statements in the questions." Mr. Speaker replied: "It is true that an Hon. Member tabling a question bears personal responsibility for the facts stated in it. I do not rule on the accuracy or not of the facts."

So the Speaker cannot, really, in each case make a ruling on the accuracy of the allegations that may be contained in a question. It must depend upon the Member himself. So far as the allegation may be against the government or against an individual, unless it bears upon his personal privileges, the government has other remedies than on a question of privilege.

Orders of the day.

ON THE BUDGET

On the amendment.

MR. W.R. BENNETT (Leader of the Opposition): Mr. Speaker, before the House adjourned we had just finished dealing with the rather irresponsible statements of the Minister of Transport and Communications (Hon. Mr. Strachan) in which he chose to involve a private citizen in this House. I'm sure that if he repeated it outside, probably the discussion between them will continue. I have no way of knowing. I do know this: that at no time have I made such statements to that person. It will be interesting to know, when the Blues are read tomorrow, whether the Minister may wish to change any of the statements he made in the House earlier today.

Dealing with the more serious aspect of the problems of unemployment, the financial plight of our municipalities and the lack of housing for many of our citizens in this province, it may be that in their defence and in their renewing old attacks and fighting old fights and quoting old statistics, the government of today has lost sight of the fact that the year is 1975. They're responsible for the problems of today.

These three areas are not problems to be made light of, they're not problems to be ignored nor are they problems that can be solved by attacking unemployment statistics or quoting unemployment statistics from 1961, or from 1951, or from 1941. The fact is that in British Columbia in 1975 we have the worst unemployment in numbers of people that we've had in years. Even for one person who is able and willing to work, it's unfortunate if they cannot find employment. For 100,000 it's just not good enough in British Columbia.

We mentioned that one of the problems we also have in this province is a shortage of housing for our citizens, for young couples starting out and, indeed, for those citizens in British Columbia who have been saving towards this end for many years, no longer young, but trying to save a down payment so they can own a home of their own — desperately saving, because that's why they chose to live in British Columbia rather than in England or in Europe or in some countries, perhaps, where home ownership has never been made as easy and where, perhaps, the privilege to own has never been financially possible. But here, housing has been affordable. I think it's the responsibility of all governments to bring it even closer to reality for the citizens of British Columbia rather than to remove it from reality.

Rather than excuses, I think the public want action. They want the government to show leadership. They want the opportunity to own in British Columbia.

One of the further problems of the creation of housing is the problem of the financial plight of municipalities. Municipalities should be a partner in solving the problem rather than having to create roadblocks and put barriers in the way of home construction in their areas because they do not have the financing to solve all of the problems of servicing those people in their communities in the Province of British Columbia.

So before we adjourned for the dinner recess, I had suggested that we needed revenue-sharing in this province and in this country between all levels of government to allocate those growth revenues to

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municipalities to allow them to make a choice on housing in their communities, not on a financial basis, but on the fact that as government they have the responsibility to serve people and provide services. No community and no citizen should have their opportunity to build a home or own a home made on a balance-sheet basis because the community doesn't feel it can afford to service them. They are citizens of the province. They are citizens of that community. They should not be denied that right on a balance-sheet basis.

I quoted statistics which showed that the municipalities weren't participating in the growth of revenues to levels of government. This party advocated, last fall in this House during debate, revenue-sharing as a commitment of this party. It is a commitment that was developed at our convention and endorsed by the party. It is a commitment we carry into this House and to the electorate of this province.

Indeed, we believe that revenue-sharing will be the only answer for all governments. It is a way out of the petty bickering between federal and provincial governments now to take a larger view and involve municipal governments. It is a way out to put the concern of the citizens of the country and of the provinces first, before the bickering on whether the federal or provincial is entitled to the money and wants the larger share and wants to build up their own little empire, forgetting that government is only there for service to people, and not there to direct or to grow like Topsy or to grow like the Peter Principle, but to grow only as they can provide better service to people. That is the only justification for the growth of any form of government.

We feel that solving the finances of the municipalities, providing realistic financial proposals, will aid in the provision of serviced lots and will lead to construction of housing in this province. Housing is something our citizens want. We propose as well that rather than the Department of Housing, which so far has not utilized the position or the funds voted by this House last year to create housing for the citizens of British Columbia — instead it has taken many of those funds and bought existing projects, or bought corporations, and bought projects that have failed financially, or projects that were already being built — the funding that this Legislature voted for that department should have been used to create housing, to create and fill the void that is there in British Columbia in many of the growth areas of this province, to provide the housing, and not only provide it and make it available, but provide it so it is affordable.

We all know you can build houses. But if you don't bring them within financial reach of our citizens, if you don't make them affordable to our young couples starting out.... You can build all the houses in the world, but the Department of Housing has the further responsibility of making sure that they are affordable and that our citizens can qualify for those mortgages and that those mortgage rates will be rates that those citizens can live with year after year. I would hate to see the citizens of this province continually tied down to high-rate mortgages at excessive rates long after the mortgage interest rate has dropped. It is bad enough that the provincial government has committed them to 10.25 per cent interest on $100 million from First Boston Corp. for 25 years at a time when that rate would be two points lower now, Mr. Second Member for Vancouver-Point Grey (Mr. Gardom).

He knows so well that one of the cruelest things this government has done is to penalize the future citizens of this province, and continuing citizens, to excessive interest for many, many years — millions of dollars. Two interest points on $100 million for 25 years would work out to well over — on a progressive basis — $100 million. I am certain that although the government may have been foolish in that financial endeavour, we certainly don't want to penalize the citizens of the Province of British Columbia in the same manner and allow them to accept the same penalty personally. We know that interest can be cruel in the cost of housing and one of the excessive parts of the cost of housing.

If we could just talk about financing, I would suggest, Mr. Speaker, that there is a time when governments that have self-determination, that are liquid enough to have self-determination, can go to the market, particularly when the market and declining interest rates are predictable. The market was predictable. Last year we had the highest interest rates in North American history. Certainly every economist, with the slowdown in the economy, knew full well that interest rates would drop, as they have. Many governments and many corporations withdrew offerings from the markets for the very reason that it was too expensive at that particular time.

I would suggest that it is unfortunate that in British Columbia, with the new high-priced exorcist, perhaps his expertise in financial matters doesn't go beyond the printing of the political pamphlet that explains how well the government is doing in a time of crisis.

I would rather have seen in this budget money for housing specified that would build houses. I would rather see a B.C. housing corporation that could direct the activities from interest rates to directing the construction of housing in cooperation and direction to the municipal governments in this province to take and show some leadership in the creation of housing for our people.

It is a failure of this budget. It is a failure that this budget didn't deal with the problems of the financial plight of the municipalities, that it didn't deal with

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the problem of no housing for our citizens, and it hasn't dealt realistically with the problem of unemployment in this province.

We can have the speeches and the wild attacks from such Ministers as the Minister of Transport and Communications (Hon. Mr. Strachan) but it will never cloud the fact that in this province our people are unemployed and seeking work. Rather than looking rosier and better — though the Premier and Minister of Finance assures us airily-fairily that somehow the market is going to turn around in May — the DBS just produced figures that we had the worst quarter in Canada's history. B.C. was one of the worst areas in Canada during that quarter when the gross national product dropped and the real gross dropped, and I wonder on what basis the Premier expresses his extreme optimism of the future in his hippy budgets.

AN HON. MEMBER: He's not even here.

MR. BENNETT: And he is not here again tonight.

We are concerned about the budget that he presented to this Legislature. The very real concerns the representatives of the people have in these three key areas haven't been met, and no leadership is being provided by the government that says it is going to collect from British Columbians $3 billion in this coming year. The government is taking credit for collecting the money of the citizens of this province, and yet none of it seems to be going to tackling the real problems in those areas of municipal finance, housing and unemployment.

Mr. Speaker, it's unfortunate that this government is more concerned with maintaining itself in office and dragging up old arguments than with meeting the problems of today. It's unfortunate they are not prepared to provide leadership and it's unfortunate that even one of their better Ministers, the Minister of Health (Hon. Mr. Cocke), was moved to make some of the foolish statements he made in debate yesterday. We had learned to expect more from this Minister in this House, but even he, running scared with the expectation of an election, is resorting to the foolishness and irresponsibility that seems to mark this government in this Legislature in this problem year of 1975.

Mr. Speaker, I support this amendment. I support it and I hope that those Members on the government side in the back bench who have to go back and report to their constituencies, rather than trying to defend an indefensible document, will show some concern for those areas and will stand up and speak in this debate. They may not have the courage to vote against the government, but at least speak for the people of this province.

MR. G.F. GIBSON (North Vancouver-Capilano): This amendment is by no means a recital of all of the problems with the budget but it does focus on three of the more important, those being the financial problems of municipalities, the housing problems in this province and the general area of jobs. I will try and stay within those perimeters, starting off on the subject of municipal affairs.

I was almost saddened to hear the Minister of Municipal Affairs (Hon. Mr. Lorimer), when he took his place in this budget debate, suggesting that municipalities had been properly dealt with by this government. In this area, this current government is no better than the government it replaced.

MR. D.E. LEWIS (Shuswap): Oh, shame. How can you say that?

MR. GIBSON: I am sorry, Mr. Member, but it is no better in this area than the government it replaced. There have been improvements made in some areas but not in this one — not in municipal affairs. You've been sliding backwards.

As the Hon. Second Member for Vancouver–Point Grey (Mr. Gardom) said earlier on in this debate, the municipalities are cap-in-hand governments. They are cap-in-hand coming to this provincial government, They are like vassals dealing with a feudal lord; they are like junkies dealing with a pusher. (Laughter.) As this government doles out the money in small quantities keeping them on the ropes all the time....

HON. D.G. COCKE (Minister of Health): You're forgetting all about when you were in Ottawa.

MR. GIBSON: I am not forgetting anything, Mr. Minister. This government has kept the municipalities starved for funds. They did one thing in this budget and one thing only. There was the annual rather than five-year per capita adjustment — that's the only thing. Nothing else, in spite of the pretence of other Ministers who have taken their place in this debate. It is going to lead to tax increases in the municipalities — taxes on people, Mr. Speaker, that this government says they are so concerned about. The increase is at least 30 per cent in my constituency, and I venture to say probably higher in other parts of this province.

There was nothing done to redress the injustice whereby the British Columbia Railway does not pay any taxes to municipalities. To the District of North Vancouver it evades a responsibility of paying $125,000 per year at least.

HON. J.G. LORIMER (Minister of Municipal Affairs): How much does the post office pay back?

MR. GIBSON: Mr. Minister, you look after the affairs of your government! You have enough

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problems with that — don't worry about other governments.

We heard a Minister earlier on today read a headline saying that the municipalities were going to get an extra $20 million. That's pie in the sky, Mr. Speaker, not a guarantee. It's gas in the ground, as the Member says. The municipalities need a tied guarantee to the revenues of this province.

Let's just start out with 1 per cent of the revenues of this province. That would give the municipalities $30 million this year. That would be something of a start and it wouldn't subject them to the Premier's latest war with Ottawa. They need a guarantee.

I was speaking to a municipal official today. I said: "How much can you put in your budget for this year to cut the mill rates on the basis of this so-called natural gas money?" He said: "Not one penny."

Do you know why, Mr. Speaker? Because municipalities, by law, aren't allowed a deficit. What are they going to say at the end of the year if they've budgeted for this natural gas revenue and it turns out they haven't got it, if it turns out that this government doesn't deliver?

MR. A.V. FRASER (Cariboo): They would put them in jail.

MR. GIBSON: They would put them in jail for it. That's right, Mr. Member. That's what they'll do.

What's this all about, Mr. Speaker, this natural gas business?

Interjections.

MR. GIBSON: Why is the Premier playing this kind of game? The real reason is that this natural gas business is an election setup. The Premier is going to go to Ottawa and he's going to demand a price for natural gas. Now, depending on how the Premier feels that week, he's going to make a demand he knows is impossible or one that is reasonable. If his polls tell him that this is a good issue and that now is the time to go, he's going to make a demand that is impossible. He's going to come back to British Columbia and say: "This is the issue, my friends. We must have a mandate; we must have an election." That's what this natural gas is about. It's for the political benefit of this government, not for the benefit of the municipalities in this province. He's setting up a phony election issue right now.

MR. FRASER: Political gas.

MR. GIBSON: Political gas. Unnatural gas. (Laughter.)

MR. D.E. LEWIS (Shuswap): Are you saying the Liberals won't live up to their commitments?

MR. GIBSON: It is not just a question of starvation of the municipalities for revenue; it's a question of cost freezes as well. In that context the government has to bear a very heavy responsibility.

The Premier did his best to say in the budget that the serious questions of inflation relate to other jurisdictions. "It's Ottawa. There's not much we can do about it here in B.C." He's busy shifting the blame on things like that that are uncomfortable. But, as a matter of fact, the Premier and that government are doing something very important ...

AN HON. MEMBER: Hear, hear!

MR. GIBSON: ... having to do with inflation. Fueling inflation.

I refer to the trend in public service settlements on which it has been so difficult to get the figures and on which we still can't get proper year-over-year comparisons in spite of the fact that they are supposed to be public documents which come out so far.

Our party over the years has been in favour of proper wages for the public service sector.

SOME HON. MEMBERS: Hear, hear!

MR. GIBSON: But we have also suggested that the proper relationship was for the government to take its lead from the private sector of the economy and relate settlements to that area, rather than trying to advance too far.

The reason for that has nothing to do with the merit of one type of employment over another, be it public or private. The reason for that is that British Columbia in this world — and the way we all make our living — has to relate to what we can earn and the price in Canadian dollars at which we can sell our natural resources. That is what pays public servants' salaries; it is what pays your salary, Mr. Speaker, and my salary. It all comes back to that in the end. When government settlements start to make a trend beyond that ability to pay, then this whole economy is in trouble.

We have underway in Victoria right at the moment a civic workers' strike which has gone on for some weeks. We may see other strikes of this kind around the province. Can you blame them when they see settlements in the public service so far announced running 20, 30, 40 and in some cases 50 per cent, plus COLA (cost of living adjustment)?

MR. C.S. GABELMANN (North Vancouver-Seymour): That's meaningless.

MR. GIBSON: The Hon. Member there says it's meaningless.

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MS. R. BROWN (Vancouver-Burrard): Get the facts.

MR. GIBSON: I hope, Mr. Member, you'll stand up and explain why it is meaningless. All I can do is look at the order-in-council and say that was the wage before and that is the wage now.

MR. GABELMANN: It's meaningless. Percentages are meaningless.

MR. GIBSON: The average, I suggest to you, is going to be at least 20 per cent, plus COLA.

Interjections.

MR. GIBSON: And I ask you whether or not any other trade unionist in this province is going to settle for anything less.

MR. P.C. ROLSTON (Dewdney): Would you work for that wage?

MR. GIBSON: Because like it or not, the government sets a target.

Interjections.

MR. GIBSON: You stand up and give your speech, Madam Member, when you are ready.

MR. C. LIDEN (Delta): Never mind. He's a millionaire; he doesn't have to worry.

MR. GIBSON: Like it or not, the government sets a target in settlements in this province.

MR. LIDEN: Listen to the mining millionaire.

MR. GIBSON: Other workers say: "We deserve that much at least because we're paying their wages. We deserve that much at least."

Interjections.

MR. GIBSON: If the other unionists are already getting more, Mr. Provincial Secretary (Hon. Mr. Hall), they will say: "That's our proper place in the pecking order and we need more again." You know that perfectly well. Nobody should know that better than you.

SOME HON. MEMBERS: Oh, oh!

MR. GIBSON: Doesn't a responsible unionist do that? Shouldn't he? Of course he should.

Interjections.

MR. GIBSON: The inflation and the strikes that are going to happen in this province this year are directly attributable to the settlements this government is making right now, without any question.

HON. P.F. YOUNG (Minister of Consumer Services): Second-class citizens; that's what you want them to be.

MR. GIBSON: You just explain that when the strikes are running hot and heavy this summer, Madam Minister of Consumer Services.

MR. SPEAKER: Order, please. I wonder if the Hon. Member would address the Chair. Addressing other Members of the House always leads to quite a great deal of excitement.

Interjections.

MR. GIBSON: The government has a very heavy burden to bear on what is going to happen to this economy this year, and it has a heavy burden to bear on the settlements it hasn't made yet since it ran out of money, and since it started putting the screws on those components it hasn't settled with in the public service.

Interjections.

MR. GIBSON: You put up or shut up, Mr. Minister.

Interjections.

MR. GIBSON: So that, Mr. Speaker, is what comes out of the government's assistance to municipalities in this budget. It denies the municipal government the revenues that it has to pay the settlement it makes, and it sets a target so that the municipal employees must get the same, and it denies the municipalities the dollars they need to pay it.

MS. K. SANFORD (Comox): You should go to Ottawa and fight for the municipalities.

MR. GIBSON: Now, Mr. Speaker, housing is the next subject. I don't see the Minister of Housing (Hon. Mr. Nicolson) here.

Here are some facts on housing in the last three years in this province. In 1973 roughly 38,000 units were constructed. In 1974 roughly 30,000 units were constructed, a triumph for the first nine months of the Minister of Housing. In 1975 the forecast by the Employers Council of British Columbia is 22,000. That has to be upped. We cannot allow that forecast to be right, because we need 40,000 units in this

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province every year to take care of the 60,000 or 70,000 people that come in from other parts of the country and the world, and to take care of the constant improvement required by British Columbians in their housing starts. Something like 50 per cent, at the rate we're going, of the requirement is going to be built.

The Hon. Member for Chilliwack (Mr. Schroeder) this afternoon set out very well the problems of the average young person trying to get housing today. The cost, as things stand, is beyond their reach, and the answer is in the improvement of supply. The Minister of Housing affects to improve the supply by building government housing. He's not doing it very quickly, and it's the wrong way to do it anyway. But perhaps, as long as they have rent control on, that's the only kind of rental housing they're going to get. They don't seem to understand that. Something like 20,000 rental units a year are needed in this province and, apart from social housing, since the rent freeze went on last year, I challenge you to show me more than 2,000 or 3,000 rental units that have been started. I challenge you to show me. We need housing as well as social housing. We need housing for the ordinary people who are just looking for a decent place to live because they just got married and maybe they're going to have a child. We need that kind of housing too. Don't you understand that? It's unbelievable.

MS. BROWN: There's no kind of housing for people who can't afford to pay. There's no shortage of housing for people who can afford to pay.

MR. GIBSON: Mr. Speaker, I couldn't believe my ears. I just heard that Member say there is no shortage of rental housing of some kind.

Will you stand up and tell us what kind of rental housing there is no shortage of?

MS. BROWN: May I, Mr. Speaker?

MR. SPEAKER: Order, please. If the Hon. Member is prepared to yield the floor.... If he does, he loses his place in the debate.

MR. GIBSON: You stand up as soon as I sit down, Madam Member. I'll look forward to that.

MR. SPEAKER: I wish the Hon. Member would direct his attention to the Chair in the proper way, and not to other Members.

MR. GIBSON: Thank you, Mr., Speaker. It's so difficult with the interesting comments coming from various parts of the House. And I want to do all I can in the Hon. Member's campaign for the leadership as well.

We heard earlier on both from the Minister of Municipal Affairs (Hon. Mr. Lorimer) and from the Minister of Housing (Hon. Mr. Nicolson) today, in some muttered asides, what I took to be attacks on municipalities; what I took to be loading the blame on the municipalities by this government for refusing to increase housing. They're blaming the municipalities.

The land is available — we all know that — literally thousands of new lots, be it rental or owner-occupied construction on the market this coming year. The land is available to drive the price of lots down, which is what should happen. The municipalities have to be encouraged, not hit over the head by this government by the Minister of Municipal Affairs (Hon. Mr. Lorimer) implying that if it's necessary they're going to take whatever Draconian measures are required. The fact of the matter is....

HON. A.B. MACDONALD (Attorney-General): Why not? (Laughter.)

MR. GIBSON: Mr. Speaker, the Attorney-General said: "Why not?" He doesn't have his button on.

The fact of the matter is that the growth that's going on in this province, that 60,000 or 70,000 people per year, is having a differential impact on the different municipalities. Some are being asked to bear a very heavy load and some are being asked to bear a very light load.

It's a provincial problem, this growth. It's not a municipal problem. It's not a problem that any municipality can solve by itself. It costs money. It costs the municipality money to take in a new resident.

The Minister of Municipal Affairs had some unhappy things to say about impost charges. Mr. Speaker, I'd rather not see the kind of impost charges we see being levied in some municipalities of up to $2,000 per unit, because it just adds to the cost of the unit, and therefore it adds to the cost of all the other housing stock in this province.

But if it's going to cost that municipality $2,000 to take in these new people, they can either load that on the existing taxpayers and give a free ride to all those other places that aren't receiving growth, or else it can protect its existing taxpayers. What would you expect a municipality to do, and what would you do if you were a municipal official? You'd protect your local people.

It's up to the provincial government to take a broader view and to say to all municipalities: "There's going to be a certain amount of growth in British Columbia whether we like it or not, and we want you to make possible the housing for those people that are coming to this province and for our own citizens who want to move into better accommodation at a reasonable price. The way to do

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that is that we will give you a grant in each municipality in respect of the newcomers you receive in any given year. We will give you a grant to take care of those extra costs for roads and parks and school systems and so on."

It's a proper provincial burden, and that's the kind of thing that this Department of Housing should be doing to unlock the land that's needed. There's lots of land there. Within the greater Vancouver region alone there are over 50,000 acres that are properly urban designated and ready to go and ready for servicing — in many cases, serviced. It just has to be unlocked, and the key is within the hands of that group across the way.

On the subject of jobs, I'll have more to say in my remarks on the main budget motion. I'll just say now that the Ministers across the way who have been reciting recreation and conservation projects constituency by constituency around this province, that are so nicely printed out in the budget, are not answering the question. Those are very good things. I congratulate the Minister of Recreation and Conservation (Hon. Mr. Radford) for the things he's doing in the constituencies. But it's not the answer to jobs in this province.

The fact of the matter is that whatever nice statistics the government Ministers read out, there are 100,000 British Columbians out of work. They don't deal with that. We don't hear that phrase, "100,000 British Columbians out of work, " from across there. They'd like to forget that. They'd like to never even know it. But they have to deal with it; and they have to deal with the fact that, try as they may, they do not have the competence to produce the growth in investment and productivity in this province to soak up that kind of unemployment.

They have to encourage others, they have to work through others, to make these things happen. They have shown a belief that the expenditure of money on just about anything that churns it around will create jobs. In fact, lasting jobs in British Columbia are created by investments in solid things like secondary industry, like forestry, like mining, like construction — things that are going downhill in this province.

MR. R.E. SKELLY (Alberni): The Liberals.

MR. GIBSON: We have a very strong economy in this province, Mr. Speaker. It is an economy that, in spite of governments as they come and go, has been able to provide a rewarding and growing standard of living for a growing population in this province, and it will continue to do so, irrespective of the efforts of that group. It will continue to be a good economy in this province. But over the years we may have difficulties, and over the years we may have lesser growth than we would have had otherwise if things are not properly managed. The 100,000 people out of work, and 16,000 in the forest industry alone, are not a sign of proper management.

This budget doesn't encourage investment. I wouldn't call it a job-security budget. I'd call it a job-insecurity budget.

HON. E. HALL (Provincial Secretary): Mr. Speaker, I was not intending to join in this debate as I felt that part of it was an exercise in repetition from the previous one. It was then a continual mish-mash of percentage figures, which I think most Members of the House are now realizing are susceptible to the remarks of previous debate when somebody mentioned the famous politician in England, the Rt. Hon. Winston Churchill, who, when talking about statistics, made some rather uncomplimentary remarks about his colleagues. I don't want to do that.

I may, however, refer gently to some of the competence expressed by the previous speaker (Mr. Gibson) when he looks at official documents. He seems to have some worries about our competence. Mr. Speaker, may I say, as the Provincial Secretary, having some responsibility for Vote 1, that I have some real problems with the competence over there if the best they can do when they get orders-in-council showing increases is to come up with the kind of figures the Member just came up with?

I entered the debate, Mr. Speaker, because I'm getting a little tired of the mischief that's being done in this province by those people who seize the opportunity to play politics with an important subject like collective bargaining. I entered this debate because I am fed up with Members who choose to take the same irresponsible course as the employers' council.

MS. BROWN: Hear, hear!

HON. MR. HALL: Strange bedfellow, may I say, to see the political activities of the employers' council and that of that Liberal Party.

But first, may I remind you, Mr. Speaker, and all Members of the House, that negotiations are continuing with a number of public service groups? Those who make inflammatory statements outside during those negotiations can be held accountable for the disruptions that may ensue. That's part of our Labour Code. I trust we all behave ourselves in here as we might behave ourselves outside.

The speech of the Member and the questions the other day are stimulated in part by the newspaper article that the Member seems to have read a number of times and which purports to give details of settlements reached between the public service and the B.C. Government Employees Union. They quote an employer representative to the effect that those agreements will be disruptive to private sector

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negotiations.

I've got a private sector negotiation here, Mr. Speaker. Just one. I think the Member knows well about it because I think he asked me a question — at least, the group asked me a question about it. This is a settlement that was made in the Burrard Dry Dock, Co. Ltd., North Vancouver, and Yarrows Ltd. Private sector. No Ernie Hall around there. No John Fryer around there. The previous agreement agreed it was okay. That was a 60 to 70 per cent increase, Mr. Member, that other employers are complaining about in a telegram to this government.

If you take the wages of a girl who just joined this service and worked in a hospital, who was getting, say, $432 a month, and you give her the bottom-end loading that most Members applauded in this chamber the other day, and then you pay her equal pay for equal work that everybody here bangs the desk about, you may very well come up with a 53 per cent increase.

Now, Mr. Member for North Vancouver, you write that girl a letter repeating what you just said to the House. I challenge you to do that.

Mr. Speaker, the largest private sector employer in this province, the forest industry, and the largest private sector union in this province, the IWA (International Woodworkers of America), executed an agreement last year. You all said it was good. You all applauded it here when we avoided the kind of strikes that were characteristic of the previous 20 years every two years. That provides a current base rate — and we're talking about jobs — of $5.23 an hour or $900 a month. That rate will be adjusted upward on April 1 in accordance with a COLA by a further $20 a month. So $1,100 a month basic labour rate, IWA. The contract expires on June 15 this year, before many of the contracts that you make reference to expire. I expect the union to be seeking an increase, being somewhat aware of what's going on outside.

The construction industry. I realize there's a slight difference because of the somewhat seasonal nature of some of the construction industry, although this province has a record of maintaining year-round capacity in that industry better than anyone else in this country. Negotiated by CLRA (Construction Labour Relations Association) — I don't think a stranger to your group. November 1, 1974 — $7.12 an hour or $1,160 a month. May 1, 1975 — our contract's going way past that — $7.98 an hour or $1,300 a month, and more in November: $1,335.

I could go on citing rates like that for some time but I don't want to jeopardize the efforts to resolve such current disputes as those that are going on between municipalities and CUPE (Canadian Union of Public Employees). But I'll limit myself to this: in the light of the labour rates established in the private sector, the suggestion, Mr. Member, that a monthly rate of $720 for a draftsman is disruptive, is very difficult to understand.

It is not the policy of this government, Mr. Member, first of all, as it was of the previous government, and as it appears to be of the government you support in Ottawa, to pay valuable public employees rates which were so low as to qualify them for welfare programmes.

MS. BROWN: Shocking.

HON. MR. HALL: That was what was going on here. I said that in the throne speech debate and I will say it again: it is not the policy of this government to do that. Members of the opposition may have retained a sense of human values which enabled them to be contemptuous of office staff, labourers, and so on. Not this side of the House, Mr. Member. They may be able to turn a blind eye to the predicament of low-income people trying to find housing in the current real estate market, trying to feed families as food costs escalate 20 per cent, but they certainly were able to do so for 20 years under that lot. The government doesn't have that sense of values. I believe that your questions indicate to me, Mr. Member, and I say this to you, through the Speaker, that you do share that value with the previous government.

To establish minimum standards of physical welfare for public employees, to establish appropriate relationships between public and private sectors, to ensure the public will be adequately served, required — and I've said this before, and I'll say it again — substantial adjustment. To lay the blame for that circumstance on the government which has had to effect those increases is to really avoid what is terribly obvious.

In the fall of 1972, when this government took office, the basic rate for psychiatric aides at Riverview Hospital was $511 a month. Dietary aides received as little as $415 a month. Those Members of this House who visited that hospital will agree that there are few people in British Columbia, in either the private or the public sector, who serve the public as well in circumstances so trying as those people do in a job that is so demanding. I am acquainted with a number of people in the public service, a number of women, who were forced to raise families on the meagre income provided by the previous government for office staff. They were as low as $345 a month. Draftsmen received $386 a month.

HON. MS. YOUNG: Shame, shame.

HON. MR. HALL: Does the speech imply, Mr. Speaker, that the government did not have to do something to address those situations? Does the Member's question imply that we should have been

[ Page 389 ]

content with the relationship between those incomes and those that have been quoted? The government has not accepted, and won't accept, those views. The settlements will reflect our view that the public employees provide a public service.

Mr. Speaker, he talked about leading. Where would the Member's speech be if I told him that a junior clerk in the provincial government service, after having signed the contract — and the Member is aware of it because he has the orders-in-council — still doesn't get anywhere near what the same person does at Hydro, or anywhere near what a clerk was getting in the lower mainland municipalities when the contract expired that is currently the series of a number of strikes? What will the Member say then, when he does his homework and looks at the figures?

What will the Member say if I tell him, and he finds it to be true, that a secretary in the British Columbia government gets less than Hydro and gets, in effect, about the same as the secretary in Victoria or in Delta or in Surrey who is now into a fresh contract bargaining situation? Those wages that I quote have to go on for some time. What will the Member say about a keypunch operator, and others? What will the Member say — because he is interested in health — when I tell him that all the hospital employees now have are comparable salaries to those in the private sector of health care and that the settlement reduces the discrepancy between men and women?

Three of the Members over there are members of the legal profession and know what is happening in the corrections branch. They all belong to the Liberal Party. They all represent, and fought hard to get, I presume, the Liberal Party ensconced in office in Ottawa. What will they say when I tell them that the negotiations that he makes reference to as being disruptive and leading don't even catch up with the federal salaries in the prison service? What will he say to that? What will he say when he examines the teachers' wages and the biologists' wages, and others, and sees that, instead of leading, instead of being disruptive, as he says, we have not even caught up yet?

I want to tell you, Mr. Speaker, that the negotiations that have been handled by the Public Service Commission in the nine or so components to date, we should be proud of them because we are getting value for money. We should be proud of them because we've got a catchup provision. We should be proud of them because we've turned the corner on some of the shameful things that used to happen. Mr. Speaker, I think the best that Member can do, when he has got all his facts and done all his homework, is to apologize for some of the inferences he made.

MR. D.A. ANDERSON (Victoria): Not a word about 102,000 unemployed. Terrible, terrible.

Interjections.

MR. G.S. WALLACE (Oak Bay): I get the impression that I am about the only Member who didn't have a liquid supper tonight.

SOME HON. MEMBERS: Oh, oh!

AN HON. MEMBER: It might help your speech if you did. (Laughter.)

Interjection.

MR. WALLACE: The Minister of Health (Hon. Mr. Cocke) asks me to withdraw and I withdraw the comment, Mr. Speaker.

The amendment mentions specifically the problem of the budget not creating enough jobs and not dealing with the financing of the municipalities. I don't know that the former speaker went into great depth in any of these two particular points. I think we would like to make our position clear on the amendment, particularly in the first instance in relation to the municipalities, and to relate my comments to some of the resolutions that the party has already passed in relation to municipal financing.

We believe that the per capita grant should be tied to the income tax revenue received by the province and that the grant be revised annually to reflect changes in the amount of revenue received by the province as personal income tax.

We also support the point expressed many times in this House that, since municipal taxes and payment for services are received by all provincial properties, lands and buildings, these provincial properties should also pay to the municipal government equivalent taxation for such facilities as would be paid by private property owners.

We go a little further in our attitude and philosophy toward the municipal government, and we feel that the municipal level of government should be given greater recognition as being a third level of government and should have its powers, responsibilities and authority acknowledged through more appropriate federal and provincial legislation, and that it be provided with additional sources of revenue in keeping with the services demanded of it.

At this particular time, and this year, it is increasingly difficult for the municipalities to reach a finite budget. I understand, in discussion with UBCM officials as recently as this afternoon, that they are caught in a double bind inasmuch as they don't, most of them, really know at this point in time what their expenditures will be, since many wage settlements are outstanding and under negotiation. So, first of all, they have great difficulty knowing what their expenditures may be. To add to that problem, they also have great uncertainty from the budget which we

[ Page 390 ]

are now debating. This I'd like to expand on a little in a moment.

I'm sure the Minister of Finance, who doesn't happen to be here tonight, has received a letter today from the Union of B.C. Municipalities pointing out that the budget speeches and the comments of the Premier himself have recognized that there will be some increases of cost to the municipalities of a presently unknown percentage. But certainly, I think the Premier himself, and certainly the Minister of Municipal Affairs (Hon. Mr. Lorimer), mentioned a figure of 20 to 25 per cent in the simple basic effects of inflation. On that basis, the letter which has been sent to the Premier as of this afternoon pleads that at least the Minister of Finance make some basic minimum commitment to the municipalities now, whether it be $20 million or $25 million or $30 million, or whatever figure is finally calculated from the very nebulous concept which the Minister of Finance attached to the revenue from natural gas. The municipalities cannot be expected to budget responsibly or to manage municipal affairs responsibly when they know with accuracy neither their expenditures or, even worse still, their social revenues.

This letter is couched in very clear and unmistakable terms and makes a very rational argument for the municipalities at this time. I would like to quote one paragraph just to emphasize what I think is the very reasonable nature of their argument in seeking municipal financing. They say, as follows:

"Additional financial relief is immediately needed by all municipalities, or at least an assurance of additional revenues during the course of this year. In view of your confidence that your anticipated price increase for natural gas will be achieved, we respectfully request that, as the Minister of Finance, you give the municipalities of this province an assurance that a minimum sum of $20 million will be made available to them in this fiscal year, flowing from the formula proposed by you, or from other sources if results should not meet your expectations. This is the only way that municipalities can at this time proceed responsibly with their budgeting and determination of mill rates."

I think that's a very fair statement to which this government should respond, and to which the Minister of Finance should respond. We can all argue till kingdom come about the pros and cons of using this social revenue or that social revenue, or the formula for deciding the amount, or various other ways in which the government can provide financing to the municipalities. But to leave the whole situation hanging in mid-air with no finite figure being quoted is, I think, really insulting to the municipalities when the government, both at election time and subsequently, has said that it will correct some of the injustices to which the municipalities were subjected under the former administration.

So, Mr. Speaker, that would be our basic initial proposal in discussing this amendment. The government should surely respond by at least guaranteeing a minimum sum which might be adjusted upwards, depending on the success of negotiations by the Premier.

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

The Minister for Municipal Affairs (Hon. Mr. Lorimer) mentioned earlier that impost penalties in some municipalities are high and unfair and have the effect of depressing housing construction. I think this only goes to prove, as the Member for North Vancouver-Capilano (Mr. Gibson) pointed out, the financial plight of the municipalities and the measures to which they are resorting in order to cope with their financial difficulties.

I do feel that the logical way to approach this problem is, of course, to give the municipalities adequate financing so that they do not have to resort to the use of imposts and other devices which ultimately have the effect of reducing the amount of residential construction.

The Minister of Transport and Communications (Hon. Mr. Strachan) earlier on this afternoon talked about the fact that the opposition only tears away and acts negatively and destructively at the government proposals. I would like to suggest that we have some positive proposals on this side of the House which we would like the government to consider.

We are concerned about the proper use of the revenue from the B.C. Petroleum Corp. Frankly, our concern is the same as that of the Province of Alberta, faced with the clear prospect of declining future revenues from a non-renewable resource.

Alberta's fight with the eastern Liberal establishment arises because Alberta has determined that it must use these revenues....

MR. D.A. ANDERSON: And the Tory Government of Ontario.

MR. WALLACE: And the Tory Government of Ontario. It must use these revenues to create a new and more diversified industrial base since the oil and gas wells will eventually run dry. In British Columbia we feel that we are blessed with the opportunity of continued economic activity, employment and provincial revenues from renewable resources, including recreational, water, agricultural and fishery resources, as well as our basic resource industry, the forest industry.

We firmly believe that where revenues or royalties

[ Page 391 ]

from non-renewable resources arise, as with coal, copper, oil and gas, it is essential that these funds be reinvested for the future welfare of British Columbia and for the ongoing benefit of our citizens.

We would like to make our position very clear that these revenues from non-renewable resources should not be consolidated into general revenues for annual operating expenditures and thus readily squandered by the high-living, high-cost operating expenses of various government departments.

We believe the revenues from the renewable resources can and should go into general revenue once sufficient expenditure has been made to keep these permanent sectors of our economy in a healthy condition. So we are proposing — as this is, I repeat, an attempt to give the government the clear understanding that we do try to provide positive alternatives to the budget proposals which we feel are inadequate — that revenues from non-renewable resources, including those from the petroleum corporation, should go to the creation of regional social-capital development funds. In keeping with our resolutions at our annual convention in Kamloops that there should be a decentralization of authority and administration towards the municipalities and regions, we believe these social-capital development funds should be under the administration of regional and municipal authorities.

Many of the revenues are developed in the regions, and we believe that the benefits, in large measure, should go back to the regions. We feel that in view of the desirability of local determination for local needs, they should be administered within and by the regions themselves.

As a party which believes very much in conservation, we believe that natural gas export prices should rise to a competitive world level, as should all prices of all export resource-based commodities produced, whether it be produced in British Columbia or Alberta or Manitoba.

We believe that this is the only way to avoid premature depletion and to encourage wise and unprofligate uses of these resources. But we have never believed that these revenues, which will decline, should be used up quickly and be wasted on one-shot deals such as the politically cosmetic programme we feel this present budget suggests and the rather airy-fairy promise, or airy-fairy suggestion, that there will be municipal aid of an undefined amount.

Our proposals would call for the capitalization of regional social development funds and for the investment of these funds at the maximum rate of return, and the use of the ongoing stream of annual investment income revenue from these funds year after year in projects for community and social benefit. I would repeat that these programmes would be under the administration of the people in the regions and the municipalities.

Given the non-renewable resource revenues we project for the fiscal year 1975-76, we would appropriate the initial regional funds for the northwest quarter of the province, the northeast quarter, the Kootenays, the northern half of Vancouver Island and the central interior region from Quesnel to Kamloops. We suggest that the initial funding for the northwest and northeast quarters of the province would be of the order of $25 million each in the 1975-76 year.

It is our feeling and our conclusion from studies that have been reported that these are the regions which, in their social development needs, have experienced considerable lack and considerable social neglect. Given the persistent neglect of some of these outlying regions, a simple per capita formula of municipal assistance, we believe, is not equitable and will not work. All that happens is that population growth continues to concentrate in metropolitan Vancouver where really it should not occur if metropolitan Vancouver is to be a fit place to live. As a result, our party has determined the need for a series of head-start funds for those regions in which the social capital requirements are already behind and increasingly serious.

Again emphasizing our attempt to be positive and to analyse the facts and figures and come up with our own sense of direction for this province, we forecast that the non-renewable resource industries will generate a total of $1.5 billion in compounded provincial revenue over the next 10 years. Our proposal is for an eventual capitalization of all regional social capital development funds combined of $1 billion within the next 10 years. Once these funds are capitalized, the regional districts and municipalities of this province could enjoy an additional $100 million year in and year out to spend as decided by the residents in the municipalities and the regions. Coupled with our long-standing policy of eliminating the school tax on residential property, we feel that this is a far better solution to the problem of municipal finance than the Minister of Finance has presented to the House at this time.

We feel that the kind of proposal we're putting forward could still be considered by this government and appropriate legislation brought forward this session.

I should state that our party regards the resource industries of the province as efficient vehicles to carry forward rational development policies. I believe we should state very clearly the rights and the tasks and the obligations of the public sector — and I referred to this in comments during the throne speech debate — and also clearly recognize the responsibilities of the private sector in the resource field.

The fact remains, Mr. Speaker, that the resource industries will only perform if there is the incentive to perform, and it's the performance of the resource

[ Page 392 ]

industries which will create the jobs about which this amendment to the motion speaks.

The Minister of Finance made various references to the books of the oil companies and the undisclosed accounts of multinational and outside companies with subsidiaries operating in British Columbia. He referred to resource profits from the private sector of the province. We would like to — and we will — put forward our suggestion in the form of a private bill, the Natural Resources Financial Disclosure Act. This bill will require every company operating on Crown, provincially owned natural resources of British Columbia, whether a public company or a private company — or a Crown-owned company for that matter — to file complete and properly audited annual income and balance-sheet statements with the registrar of companies open for public inspection.

We have suggested that this would encompass a long list of large oil and gas, mining and forest resource-based companies. Of course, while we believe in this approach to disclosure, we recognize that disclosure alone certainly does not create jobs; and the unemployment situation in the province, as has been mentioned by many speakers, is serious.

We believe that the unemployment is entirely traceable to three sectors in our economy which are functioning under capacity: the forest industry, the mining industry and the housing industry. We really feel that none of these need be operating under capacity and that British Columbia really should never have to live in the constant fear of unemployment. We, in this province, are living in a world where there is a great demand for resources and what we have to do, really, is to take advantage of this opportunity to plan a reasonable, soundly-based economic strategy of improvement and diversification and balanced growth.

During the throne speech I outlined some of our proposals regarding the forest industry and I think they are worth quickly commenting upon again. We would favour a system of average incremental and negative stumpage royalties, using a forest industry stabilization fund, which would accumulate funds in the good years and which would be available to provide payments and keep people employed during the difficult years.

AN HON. MEMBER: That's their policy.

MR. WALLACE: Well, it doesn't seem to be working, Mr. Member. I don't think they have a stabilization fund and they took a long time to cut the stumpage even to the minimum. We believe that a stockpiling arrangements could be worked out in a co-operative way between the provincial government and the forest industry, and we believe that working capital provincial loan guarantees should be made available to non-integrated lumber and other woods products companies, and to independent logging contractors.

We believe there is a real need for a simplified and equitable stumpage formula for all forest companies which would allow for full and realistic cost allowance against stumpage, which would account for regional differences in logging development requirements, timber quality and operating costs ...

AN HON. MEMBER: We do that now.

MR. WALLACE: Well, you're not doing it very well .... and which would extract certain environmental protection costs which should be borne by the public sector and not merely by the private sector. As we mentioned also in the throne debate, we believe there is real potential for long-term marketing arrangements with a wider variety of other countries for lumber, plywood and other products.

This combination of programmes, in our opinion, is quite sufficient to allow the whole of the forest industry of British Columbia to operate at, or very near, full capacity every year. We feel, in this way, that one of the main sources of unemployment in British Columbia could certainly be, if not completely resolved, greatly mitigated on a continuous basis.

The amendment mentions the housing problem and the lack of real plans to cope with the housing shortage. We believe that one of the main problems is the lack of sufficient amounts of capital, as I mentioned earlier, and the lack of incentives to the investor, particularly in the light of rent control and other measures which this government has introduced. I don't feel that there need be any further great emphasis placed on that in debating the amendment. We would prefer to speak mainly on the unemployment and lack of job aspect of the amendment.

In mentioning that we have three main resource industries which are functioning under capacity, the others that bear a great deal of consideration are the mineral industry.... And all the verbiage in the budget address notwithstanding, B.C. needs development of its reserves of oil and, particularly, natural gas. This province has supply contracts with the Pacific northwest and we feel that this government has taken a somewhat cavalier attitude, particularly by the Premier and by the Attorney-General (Hon. Mr. Macdonald), in regard to be honour and sanctity of agreements. We feel that we should make every possible effort to meet the agreements which have been made with the United States.

Of course, regardless of the export situation, this province, Mr. Speaker, certainly needs natural gas for its own use within its own boundaries, and we feel here is only one way of assuring that enough of the

[ Page 393 ]

oil and gas reserves can be developed in the light of the needs of this province. One of the ways is a higher net payback to the explorers and producers of oil and natural gas. The present price of natural gas, let alone a further increase, allows for very substantial revenues to the provincial and federal Treasuries. Our party has already proposed that when the price is increased, as we believe it should be, the additional revenues that flow to the B.C. Petroleum Corporation, together with the present net revenues of the corporation, should also go, in part, to the creation of regional capital development funds ...

AN HON. MEMBER: How do you use those?

MR. WALLACE: ... and despite .... Well, these capital funds would be used for some of the community, social, health and human resource programmes which we feel should be more under the control of the regional and municipal residents.

Even so, in certain contrast to the position explained by the government, we feel a greater part of the price must go back to the producer. We feel there is not much point in negotiating a higher price for natural gas if the necessary supplies of natural gas someday are no longer going to be produced.

We recognize the concern of the Minister of Finance and this government about excessive profits by the producers. We suggest that if there are excessive profits made or likely to be made from the production of oil and natural gas these could be clearly revealed in the accounting required under the legislation I have suggested, which is complete disclosure of full and precise balance sheets of the companies I mentioned earlier on.

There is great pressure to achieve self-sufficiency in oil and natural gas, both in eastern Canada and the United States, and we believe that unless there are some very realistic incentives, the required amount of exploration and development will not occur in British Columbia. We feel that we could learn a great deal from some of the incentives which apply in Alberta. But, of course, as soon as one talks about oil and gas companies to this government, there is a paranoid response that all companies are making excessive profits.

Our party has no brief one way or the other for the oil and gas industry in B.C. We feel that any resource-based industry should primarily be an efficient vehicle for provincial goals and provincially determined policy, as a means of getting the things done which we feel should be done for the people of British Columbia.

We recognize, and I think the government recognizes, that we will not get things done unless there is the opportunity through good management whereby companies can earn an adequate rate of return on capital investment. Our estimate of this adequate rate of return is less than the industry would call for, perhaps, and I suppose it's more than the government, in its present attitude, would accept. We feel the incentive rate of return to the oil and natural gas industry is 15 per cent after tax and interest but before dividends are paid. We're no more interested than the government is in subsidizing the oil companies' head offices in New York or Texas or wherever. We are only interested in seeing that enough oil and gas are produced to meet the needs and commitments of the people of the province. We feel that to meet these needs there has to be a much greater amount of incentive than we presently see in this budget.

AN HON. MEMBER: What about our export requirements?

MR. WALLACE: One of the Members asks about export requirements. One of the factors that puzzles me about the government's proposal to pay the municipalities out of revenue from natural gas is the fact that members of that same government have, on occasion, said that maybe the day is not too far off when we should not be exporting natural gas at all, that it is such a vital natural non-renewable resource that we should be using it for our own benefit within our own borders. It seems to me unusual that we would tie the financing of the municipalities to a social revenue which one day will decrease and might disappear. I am suggesting that if incentives are provided to producers and exploring companies, we will have the necessary continuing discovery of new sources of natural gas and oil which would make it feasible and possible to continue to export these products and hence derive revenue for the province.

We certainly believe that the resources are owned by the people of the province and that there should be a fair rate of return to the people of the province. But there has to be a fair rate of return also to the companies and the individuals who are active in exploring for new sources and developing them.

We must continue to expand our resource-based industries. We feel the expansion should be neither a wide-open boom-and-bust approach; nor should it be along the lines we so often hear of a no-growth policy. We believe that the long-term target of this province should be a real growth rate of 6.5 per cent a year, and that a rate of population growth which would be suitable and desirable is 2.5 per cent per year.

Within this average, the population growth of metropolitan Vancouver might be less than 2.5 per cent, but more than 2.5 per cent per year in the regions of B.C. where we would like to see growth occur. At least 4 per cent real growth per year should be allowed for increase in real per capita income with the goal of doubling the real income for each B.C.

[ Page 394 ]

family every 12 to 15 years.

The population growth at the present time is 3 per cent, and I don't try to overlook the fact that the rate at which population grows is not an easy factor to control or to regulate. But the result of a target of 6.5 per cent real growth per year would be that the natural resource stock of this province allocated to development could be expanded at a steady rate of 5 per cent a year, and this rate would hold for the next 10 years, by which time the necessary stimuli to regional industrial diversification would already have been introduced.

In certain commodities such as coking coal this annual rate of resource release would be sharply higher than 5 per cent, because we have indications that coking coal will be replaced by alternative technological processes within the next 25 years. As far as the copper is concerned, the rate of resource release might have to be less than 5 per cent if maximum sale prices and optimum revenues were to be maintained.

But an effective and equitable mineral royalty structure must account for exploration costs, investment costs and production revenues and returns. We feel that this government still has not recognized the serious situation in the mining industry, and, as I said earlier, the Minister of Finance prefers to put the cart before the horse and say that mineral revenues, which are to be much less in the coming fiscal year, are evidence of the fact that the mining industry is not being taxed in a punitive way.

We feel that if we are to maintain mineral exploration and future mining royalties, it's essential that the mining industry in B.C. explore for more sources of minerals — and I'm glad the Minister of Mines has returned to his place.

AN HON. MEMBER: That's not his place. I can tell you where his place is.

MR. WALLACE: We believe there are still inadequate incentives to both provide exploration and development of mines, not to mention the jobs which have disappeared because of the present slump in the mining industry. This is what the amendment is really all about: the creation of jobs by the judicious development of our resource-based industries.

Heavier investment costs in mining arise from the latter stages of ore-body development than actual expenditures on the mining and concentrator operations themselves. Since these are the operations that generate continuing employment and provincial revenues, no royalty should be charged during the capital investment payback period.

HON. L.T. NIMSICK (Minister of Mines): No stumpage on timber either.

MR. WALLACE: I'm talking about minerals. They're a little different than trees, Mr. Member. Trees are renewable; the mines are not necessarily renewable. I'm talking specifically about mineral royalties, Mr. Minister, and I'm saying that in our opinion .... Your neighbour on your left-hand side, the Minister of Transport (Hon. Mr. Strachan), appealed earlier on this afternoon for the opposition to come up with some positive ideas instead of just tearing down the government. If you would be so generous, you might just listen to some of these positive proposals that I'm suggesting the government might consider.

AN HON. MEMBER: Good. Let's hear it, Scotty.

MR. WALLACE: We feel that mining operations generate continuing employment and provincial revenues, and we believe that no royalty should be charged during the capital investment payback period.

HON. MR. NIMSICK: Are you not working to pay taxes on your home?

MR. WALLACE: For an efficiently managed operation, we would calculate this period at four years. Thus royalty in the mining sector would be charged according to a percentage of output value after exploration and after the initial four-year capital payback period.

AN HON. MEMBER: At today's prices you don't get paid back in four years.

MR. WALLACE: No reduction in royalties should be entertained on production after the four-year period unless all after-tax profits are committed to future reinvestment in British Columbia.

We feel that mining sector incentive and the royalty structure have to be fair. It represents all the mining sector needs and all it should get. But the incentive to the mining sector should be directed to keep it exploring and developing and producing and reinvesting for higher added value within British Columbia. This sounds very much like the kind of ideas I used to hear the present Minister of Mines expounding from this side of the House when he was in the opposition, particularly the attempt to have higher value added to the original ore and the whole development of secondary industry and other ways in which we could not only utilize our resources to a greater degree but provide jobs in the process.

We believe that the structure of mineral royalties which we are suggesting could generate upwards of $50 million per year by the fiscal year 1978-79, instead of the paltry figures which the Minister of Finance

[ Page 395 ]

is quite proud, apparently, to quote in the budget which, as I say, he's getting mixed up with cause and effect.

We feel, Mr. Speaker, that these are some of the positive proposals that in our resource industries would both make wiser use of capital, produce more revenue and, more importantly perhaps of all these goals, create jobs.

DEPUTY SPEAKER: Hon. Member, you're into the last two minutes.

MR. WALLACE: Thank you, Mr. Speaker.

I would just like to end by commenting on the reply of the Minister of Health (Hon. Mr. Cocke) when he talked about the intermediate-care problem yesterday. While providing the need to the citizens concerned is certainly the primary motive, it would not be out of order to suggest that the whole health industry and the whole health field has become one of very intensive employment for a vast variety of people with high skills and other levels of skill.

It would seem to me, in trying to make positive suggestions, that it is not just a question of providing a health service to elderly citizens very much in need but it would have the spin-off effect of providing employment in the construction industry, particularly if we went into a programme like the Alberta programme. Furthermore, once the construction is completed, it would provide a sustaining and continuing amount of employment in an industry which hitherto has been perhaps not only neglected but looked upon as being less productive of revenue for the province.

As the Minister has stated and as the Provincial Secretary (Hon. Mr. Hall) mentioned, the wages in the hospital field and other fields are at an all-time high, which means that the recipients are certainly paying taxes and buying consumer goods and contributing considerably to the revenue of the province.

DEPUTY SPEAKER: I am sorry, Mr. Member, your time has expired.

HON. J.G. LORIMER (Minister of Municipal Affairs): First of all, I would like to say that I realize why the motion that was put on a couple of days before I spoke yesterday is here. I had expected, though, to see this motion withdrawn after I had explained to the House yesterday that the municipalities, in fact, had a bumper year last year — the best year they have ever experienced. This year they will receive considerable amounts more.

They are now embarked on a programme-sharing situation with the province. This year we expect that they will receive much greater sums of money than they did even last year, and last year was a provincial record. It's an assurance from the federal Liberal government, and I am certain that we can all take the word of the Liberals in Ottawa as we can the Liberals in Victoria. So I don't think there is any question about that.

But I do want to say that I am surprised at the source of this particular motion and the subjects that they use in their motion. For years the municipalities were in, I suggest, dreadful shape under the Social Credit government. It's only the time now that they've been taken out of the depression.

AN HON. MEMBER: Hear, hear!

HON. MR. LORIMER: The other section is a section dealing with housing. In 20 years the Social Credit government never built a house, and there's no argument about that.

I remember, when I was an alderman in Burnaby, that we proposed to the government of the day six separate sites for construction of housing that we were prepared to have go into public housing. After a great amount of correspondence we finally were told that we had to prove there was a need for housing in the greater Vancouver area. It was pretty obvious right from the war that there was a great need for housing throughout that area of British Columbia.

Subsequently, approval finally came for one of the sites, and the other five sites were turned down. Some two years later the buildings started to go up, which was a joint effort for a large 90-suite apartment block for the low-income families on Stride Avenue in Burnaby.

MR. L.A. WILLIAMS (West Vancouver–Howe Sound): Did you get a better deal on Casa Loma?

HON. MR. LORIMER: No, Casa Loma was a good deal. Casa Loma is only one of the deals. There's a great number of activities in Burnaby in housing. Just down the street from where I live there are eight duplexes that are presently just being completed and occupied. They are a model type of home with trees around them. Beautiful, a beautiful spot.

SOME HON. MEMBERS: Who built them?

HON. MR. LORIMER: I'd like to say that initially, when we became government, I did have the responsibility for a few months in the housing field. Immediately, I went to find the housing department in the old Social Credit government housing department so I could introduce myself.

Of course, they did have one man. Jack Williams was the housing department for the previous administration. Jack Williams was a very fine gentleman, but I would suggest that he did an awful lot of work as one man trying to run the housing

[ Page 396 ]

operations of the Province of British Columbia. He had only been there for three or four years, I believe. Before that, the person in charge of housing was the Deputy Minister, Everett Brown, who used to have time to spend about five minutes a week looking after the housing problems of the Province of British Columbia.

Here tonight we have this motion saying that the housing problems are not being resolved by the government of British Columbia, ignoring the fact that $90 million extra is being spent on housing above what was being done just three short years ago. It is almost ludicrous to be spending so much time debating this type of motion from that particular party.

MR. A.V. FRASER (Cariboo): I just want to rise tonight and say that I certainly support this amendment. I am very interested in the interest taken by the heavy hardware from the other side. I believe we have had the privilege or honour to have four or five cabinet Ministers up here in defence of government policy. So the amendment has hit the spot. They are really jumpy about this amendment.

The other observation I have is that the Minister responsible for a lot of this trouble has seen fit not to even be here. I just wonder where he is when we are debating an amendment to the budget address. I recall that two or three years ago when we were debating this the other Minister of Finance went away for a few minutes. The present Minister of Public Works (Hon. Mr. Hartley) was very incensed and ran around out in the hall, kicking people because the Minister of Finance wasn't in the House. So I think it is our turn to run around doing a little kicking because the present Minister of Finance has seen fit to be away from this debate all day.

HON. MR. COCKE: That was during his estimates. What are you trying to do — mislead the House again?

MR. FRASER: Well, he was gone for 20 minutes and the present Minister of Public Works was really excited about it. You know that. He wasn't away for two sittings.

HON. MR. COCKE: Go back out to the wilderness where you can mislead people more easily.

MR. FRASER: Is that right? There goes that Minister of Defence again. Chirp, chirp, chirp over there. You should look after your own department and never mind veering in to other things.

AN HON. MEMBER: Go count the seagulls!

DEPUTY SPEAKER: Would all Members please address the Chair?

MR. FRASER: Regarding the amendment before us and the budget itself — the huge sum of $3.2 billion — the increase in this budget, of course, is coming right out of the taxpayers' pockets. This government would like to make the public think that it is coming from resources, but in fact it comes out from the individual taxpayer through forms of personal income tax, property tax, gasoline tax, and so on.

This year, I might say, Mr. Speaker, that in this province there will be an increase in the property taxes of a minimum of 30 per cent net. After all the so-called credits that this government say they are giving, it is noted that there is no increase in the homeowner grant. I also note that throughout the province — the Minister of Education (Hon. Mrs. Dailly), by the way, spoke today and she didn't mention this side of it — apparently there is going to be, because of an inadequate finance formula for education, an increase in property taxation for education alone of 10 mills and another increase of 10 to 15 mills for general purposes. The overall will be an increase of 30 per cent. Somebody who last year had a net property tax of $400 this year can certainly look at a tax bill of $500 to $550.

There is another alternative to this: the municipalities and the school districts can reduce the service to the citizens. I don't know what they will decide to do but I don't think that they will be able to get away with reduction of services to the people. They will have to pass on the increase because of the inadequate support that this government is giving the school boards and the municipalities.

It was said earlier, I think, that the municipalities were referred to as junkies; I would refer to them as beggars. As a matter of fact, the leaders of municipal government are in Victoria tonight begging, waiting for a meeting with the Minister of Finance, with whom they can't catch up. They are begging for more relief from this government. They are here just begging, trying to evade the fatal day of taxes going up.

I was amazed when the Minister of Municipal Affairs (Hon. Mr. Lorimer) spoke yesterday — not at what he said tonight — about them going to swing another club at the municipalities. At least, he came up with threats that if the municipalities don't stop the impost fees, or some municipalities don't, then they will take provincial action to stop this.

Well, I have news for the Minister of Municipal Affairs. If he would do his duty and communicate the problems of the municipalities to the Minister of Finance, he wouldn't have to use any big-club methods that he suggested yesterday that he's going to use. The only reason these impost fees are levied by the various municipalities is to get revenue to survive, due to the fact that they don't get proper provincial support. I don't like that veiled threat he

[ Page 397 ]

gave them. It is irony that today and tonight and tomorrow the Union of B.C. Municipalities are here to see the Minister of Finance and not the Minister of Municipal Affairs. There seems to be a communication gap there. I would suggest that the Minister of Municipal Affairs take that avenue to contact the Minister of Finance, rather than further clubbing the individual municipalities about their impost fees.

The fact of the matter is that with this budget of $3.2 billion the municipalities will be tickled to death to get an extra $20 million this year. It is, in effect, less than 1 per cent of this enormous budget, and they would be well satisfied, I'm sure, with that. But they want to be assured of that.

I don't think this House realizes that the municipalities must set their mill rates in ample time so that they can get their tax notices out and get the revenue coming back in. They certainly can't set mill rates under the airy-fairy scheme that the Minister of Finance put before them in this House last week. I refer, of course, to the natural gas deal.

While it is said that the federal government has agreed to an increase in the price of natural gas, I don't think they've agreed at all. It's a completely blank cheque, and I'm sure that right now the Minister of Finance knows what answer he is going to get when he gets to Ottawa. If he doesn't, he should. I'd suggest the answer is: "Yes, we'll let you increase the price of gas a little bit, but probably effective January 1, 1976 or 1977." So where does that put the municipalities in 1975? They get absolutely zilch out of an agreement like that.

But, in any event, they must get their budgets firmed up now within the next 30 days, and, of course, they can't put one cent in the budgets from the natural gas sharing proposed by this government.

Mr. Speaker, this party — the NDP — campaigned in 1972 that they would give a better deal to municipalities. It is another campaign promise they've broken, because right at this time the municipal people and the citizens have never been more worried about the increased taxation at the municipal level than they are right now in 1975.

MR. LEWIS: That's rubbish and you know it.

MR. FRASER: This turkey farmer from up the road here says it's rubbish. Well, I'm going on to another subject now that is not rubbish but is garbage.

MR. LEWIS: You should get out and do a slow waltz with Vander Zalm.

MR. FRASER: While the provincial revenues have advanced 60 or 70 per cent since this government took office, due to inflation and a lot of other reasons, the municipal revenues have not advanced one fraction of that.

Right at this time there are several strikes by municipal employees in this province and threatened work stoppages. Quite frankly, I don't want to get into the dispute of how much they should have or anything, but it's obvious that the civic workers should have an increase in pay of some degree. I think only one or two have settled. Several are out on strike and more are threatening.

The fact is that the municipalities can't afford to make a decent deal with their employees. Consequently, the municipal citizen is being deprived of essential services such as garbage collection, maintenance of water services, maintenance of sewer services. I say — I think it was mentioned here once before — that this is really risking the health of these communities and is most unfortunate because of the lack of funds coming from the provincial government.

I would relate that I'm sure all municipalities would be happy, as I said earlier, with a $20 million increase. It's amazing to me that it can't be provided out of this budget when this government has provided over $80 million in salary contingencies. I assume that is for salary increases in the fiscal year 1975-6. Their salary contingency items are four and a half times what the municipalities need from this government. As I say, it's only less than I per cent and they haven't seen fit to do anything about it.

The Minister of Finance referred to this as a job security budget. I don't know who the job security is supposed to be for. In the area of the province that I come from, right at the present time there is 14 per cent unemployment rate, the highest it has been up there since the early 1960s. I can't see where this budget is going to help very much in that respect.

I just want to close by saying that there is something that could happen if this government gave direction to the forest sector in the central northern interior. I refer to the present stumpage rate which is the minimum under the statute of $1.10 per 100 cubic feet. This was put on to help mills run late last fall. When it was put on it was announced that there would probably be changes on March 31.

I would say to the government that they would help a lot if they would announce now what changes there are going to be so that the industry can assess their position. March 3 I is not very far away. If they are going to have an increase in stumpage, it's certainly liable to affect the job security that this budget refers to. I think it's about time, in all fairness to the industry at large, that they be told now what the rate is going to be. Is it going to be the same or increased? If it's going to be increased, how much?

Mr. Speaker, I certainly take great pleasure in supporting this amendment.

MR. C. LIDEN (Delta): Mr. Speaker, it's rather

[ Page 398 ]

difficult to understand the opposition in the way they've been conducting themselves on this amendment. They've stood up here tonight and they've criticized the $3.2 billion budget. "It's too much money." "It has increased taxes." Then they criticize the amount of money that is being sent to municipalities or being provided for housing.

You can't have it both ways, but that's what they're trying to do.

MR. LEWIS: Wishy-washy.

MR. LIDEN: It was said here a little while ago that the municipalities are beggars as a result of this budget. If they're beggars now, I wonder what they were before for 20 years in the years that some of those Members who have spoken tonight served on municipal governments. So did I; so did many of us here. We've seen what is happening.

MR. G.B. GARDOM (Vancouver-Point Grey): They were beggars then and they're sons of beggars now.

MR. LIDEN: Municipalities have never been better off than they are today.

It is said that we campaigned in 1972 to provide better financing for municipalities, and we have done just that. We have improved the finances of the municipalities and you know it.

We have heard tonight, though, some really strange things. We heard a despicable attack, a really unbelievable attack by the Member for North Vancouver-Capilano (Mr. Gibson) on the working people of this province, particularly on the people who work in the public service. That Member, I think, should be making apologies to all the public servants in this province after the things he said here tonight.

We have introduced something this year that has been talked about in municipal circles not only in this province but across Canada for many many years: the whole question of resource revenues being shared with the municipalities. That's something that has been taken up by the federation of mayors and municipalities and been discussed over the years. For the first time some provincial government has made a move in that direction. And they're critical of it. They're critical of the municipal policies; they're critical of the position that has been advanced by municipal governments for years. Revenue-sharing has been talked about in the budget, and it can provide up to the equivalent of $ 10 per capita or $15 to $20 per capita, depending upon what comes out of that resource revenue.

Interjections.

MR. LIDEN: That's the sort of thing they're critical of. One day you're saying that there isn't enough money and now, when we produce some, you're saying it's being done the wrong way. Yet it's being done on the basis of what the municipalities have asked for for years — the very policy they asked for.

Interjection.

MR. LIDEN: The whole field of discussion is not only taking place in this House but also out in the public arena. We look around and we see some political wanderers. There is certainly one wandering around Surrey who's touched on a lot of bases, been hanging around various political parties. Lately he seems to have bought himself a ticket on the Titanic and joined that group that is going down, down, down every time there is a poll taken. You know, he's a great guy for getting headlines, though, even though he's not sure where he is going politically. The last I heard he wasn't sure whether he was going to stick with the group he's with right now, that there's a change coming. He may be back with you people. How would you like that?

The mayor of Surrey: he's set himself up a straw man and got headlines in the New Westminster paper. He's set up the whole question of municipal finances and suggested much of the same thing that's been said here today about municipal finance. Set up a straw man and then start to shoot at it. But when you start to look through his story, what do you find? You find that they budgeted for an increase of $2 per capita, and in all the figures that he presents, even the worst figure that's presented by that mayor, it comes to $4.50 per capita — more than double what they budgeted for — $6.8 million in that rearranging of per capita grants in this province. That's an average of over $3 per capita throughout the province, and certainly that's the kind of thing that these people have been shooting at.

I don't understand how all of a sudden they become champions of the municipalities. They become champions at a time when the whole thing is going the other way. Compare the old sewerage assistance funding that the former administration had, where you spent $250,000 in three or four years compared to the $5.5 million that was spent in one year as a result of the change of government and the change in policy.

The same kind of thing in the community recreation facilities grant: $32.5 million produced well over $100 million worth of recreational facilities in this province. You know, that's 100 million times as much as was produced before — 100 million times as much. And these people are saying that they are the champions of municipal finance, and they're critical of this budget because it doesn't provide

[ Page 399 ]

enough in municipal finance.

MR. H.W. SCHROEDER (Chilliwack): $45 per capita.

MR. LIDEN: It is unbelievable the kind of arguments that are being made here tonight, when all of the things that have been done have really destroyed their argument. I think the Minister of Municipal Affairs was quite correct when he said that he would have expected that a reasonable opposition would have withdrawn that amendment before they even presented it.

Mr. Speaker, these people can't have it both ways. The movers of the amendment, the kind of speeches that we have had from the Liberals tonight, their friends out there, the mayor of Surrey — all on the same bandwagon; but they really don't know what they want. They haven't come up with a proper kind of proposition at all. And if we look back at what they did, the municipalities starved for 20 years, and now, the first time they are getting something, these people are moving amendments and trying to set the whole thing back.

Mr. Speaker, there is just no question that this amendment has to be turned down.

MR. H.A. CURTIS (Saanich and the Islands): I rise to support the amendment. I must say that while we've had a good association in committees and so on, the previous speaker astonished me with his statement, one statement at least, to the effect that the municipalities have never been in better shape than they are today. That simply is not correct.

AN HON. MEMBER: Oh, oh!

MR. LEWIS: It's true.

MR. CURTIS: The significance today, Mr. Speaker, of the Union of B.C., Municipalities executive coming to Victoria for an emergency meeting, as has been referred to by the Member for Cariboo (Mr. Fraser) and by the Member for Oak Bay (Mr. Wallace), I think cannot be overlooked. The executive represent all areas of British Columbia, and one does not call a meeting of that executive on short notice without very careful consideration of the urgency of the subject matter to be discussed.

The amendment which has been proposed, and which we have been debating this afternoon and tonight, deserves very serious consideration by this House and by the people of B.C., because certainly, while we can admit that local government in this province and in other provinces in the past have not had the kind of breaks or assistance which it needed and deserved, the situation in this province now is at a crisis stage, and this government, apparently, on the basis of what the Minister of Finance has said, and what the defenders of the position taken by the Minister of Finance have said, is simply unable, first of all, to recognize the fact that a crisis exists and, secondly, to do anything about it.

A very simple choice facing local government in this province right now is to pass along what has to be described as an absolutely intolerable tax increase for general purposes, and for education, or, as the Member for Cariboo said earlier tonight, to consider for the first time seriously and severely cutting back on those services which have traditionally formed part of municipal operation. It is that serious for 1975.

You pass along an increase which is not acceptable to the people who pay the bill — the taxpayers, the property owners, the tenants — or you cut back services in a manner which has not been seen in many years in B.C., if indeed it has been seen at all in the past.

If, as the government speakers told us repeatedly this afternoon and tonight, municipalities are so well cared for in the year 1975, then why did the UBCM executive have to rush to Victoria this morning — some 10 members, I believe — to meet in special session and to prepare and deliver a letter to the Premier and Minister of Finance? The Member for Oak Bay (Mr. Wallace) also had a copy of the letter. I believe that it was released to the press gallery, in fact, just a few minutes after it was delivered to the Premier's office. And probably the Premier and Minister of Finance, because of his absence today, has not yet seen the letter.

The Member for Oak Bay quoted one very important paragraph. There are a couple of others, I think, which should be put into the record as we debate this amendment and as we discuss the plight of municipalities. The letter requests, as others have observed, a meeting with the Minister of Finance at the earliest possible time. On the first page one paragraph says:

"Our immediate concern relates to two basic proposals contained in your budget. These are (a) your recognition of the need for an updating of the per capita grant payments of earlier years, and (b) your revenue-sharing proposal."

The executive, over the signature of the president of the UBCM, goes on to say:

"Our preliminary analysis indicates that the updating of census figures brings very limited benefit to most municipalities, disproportionate benefits to a few and none at all to at least 23 municipalities.

It is, in any event, simply intended to make up for an admitted deficiency in the past. But" —

Mr. Speaker, the final sentence of this paragraph — "it will not even meet this

[ Page 400 ]

objective, in that it will still — leave a 40 per cent shortfall due to the method of averaging used.

"The only indicated source of additional revenue which may help municipalities to meet their budget commitments may be in the revenue-sharing formula based on your expected increase in the export price of natural gas."

Others have talked about this. The letter goes on to say:

"This is an unknown quantity to us at the present time for our immediate purposes."

Again, I have to ask Members of the government to recognize, departing from the text of the letter, Mr. Speaker, that it is an immediate situation within the next few weeks, as the Member for Cariboo (Mr. Fraser) told you just a few minutes ago. Budgets will have to be completed to meet the statutory date of May 15; tax bills will have to be sent out. The municipalities don't have waiting time while we wonder whether there is going to be revenue from the sale of natural gas to be passed along to local governments. They don't have any time. They are working now on their budgets. They're not going to get any money, but even if there was the slightest chance that they would, Mr. Member for West Vancouver–Howe Sound (Mr. L.A. Williams), they can't afford to wait. Well, I hope they've realized that after their meeting today, and when they do finally, hopefully, get to meet with the Minister of Finance.

Interjection.

MR. CURTIS: One-third of nothing is still nothing. That is correct.

That is the situation, as far as the UBCM is concerned today, with a meeting called urgently and held in Victoria this morning and a letter transmitted to the Minister of Finance, and that is local government's response to the budget which has been so highly touted by members of the NDP this afternoon and this evening with respect to local government. That is what the parliament of local government in British Columbia thinks about the Minister of Finance's document delivered in this House last Friday.

MR. LIDEN: How would you like to have Dan Campbell back?

[Mr. Speaker in the chair.]

MR. CURTIS: We've got a couple of examples which may also be of interest to the House. I was chastised once for reading a lot of letters. I am not going to read letters tonight, but in January I took the trouble to contact a number of typical municipalities in British Columbia to ask them how they saw the 1975 mill rate situation as opposed to 1974. I tried to find a representative group of small municipalities, larger cities (including Vancouver), those who have rapid growth and those which are relatively stable. I will just quote briefly figures only from the replies which were received:

Central Saanich, in the constituency I represent: for 1974, general purposes, 28.8478 mills; provisional for 1975, 36.21 mills. The estimate of a final mill rate for 1975 over 1974 is seven mills.

Village of Princeton: 1974 mill rate, 32.795; expected rate for 1975, 38.545.

I asked in the letter: "How do you feel the municipality, or village, or town concerned will be able to raise the revenues which will be needed for this added mill rate?" Under this point, Princeton replied: "No comment."

Here's Trail. General purposes last year, 48.03 mills. The 1975 provisional budget mill rates would be 59.19 for general purposes. The 1974 budget in Trail was $5,012,500 — that's for general purposes; education, $2,285,000; and the balance, which would include debt, hospital finance and so on, $2,727,000. The 1975 provisional budget, $5,943,000; education up from $2,285,000 to $2,742,000.

The District of Saanich: last year, a general purposes mill rate of 40.98; facing this year a provisional mill rate, for general purposes, of 52.34 — from 40.9 to 52.3.

Dawson Creek. General purposes 1974 mill rate, 36.33. The provisional budget, general purposes mill rate for 1975, 41.33; a general purposes increase of seven mills; school, six mills; hospital and regional district, two mills. The total potential increase in Dawson Creek, 1975 over 1974, is 15 mills. And, Mr. Member for South Peace River (Mr. Phillips), as you know, the mill rate in Dawson Creek produces approximately $23,000. Fifteen mills potential increase.

Langley, another example of an increase, significant. Mission ...

Interjection.

MR. CURTIS: I'll tell them about yours; very well then, Mr. Member for Langley (Mr. McClelland), okay. General purposes 1974, 31.49 mills; 1975 provisional, 38.13. Put it all together, including debt, school, regional hospital district, MFA, the Central Fraser Valley Regional District and the Vancouver-Fraser Park District, 1974, 71.14 mills; 1975 provisional budget, 79.36 mills.

Mission should be of interest. These are people taxes. This is the narrow property tax base which has to produce virtually all of the money available for local government purposes.

Interjection.

[ Page 401 ]

MR. CURTIS: I'm talking about the mill rate which ends up in tax dollars, as the Attorney-General very well knows, Mr. Speaker.

Interjections.

MR. CURTIS: Mission, 44.74 mills in 19 ....

HON. MR. NICOLSON: Tell the whole truth.

Interjections.

MR. CURTIS: Mr. Speaker, the Attorney-General knows full well that the assessment has been frozen this year, and there's been relatively ....

Interjections.

MR. CURTIS: It's like squeezing ....

Interjections.

MR. CURTIS: Mr. Attorney-General, if I could help you .... I realize that you have a degree in law, and I respect you for that, but when you're dealing with property tax, if you squeeze the balloon at one end, the other end breaks — that's the problem. So if the assessments are frozen and there is relatively little increase in assessment in many of the examples I've quoted tonight, assessment increases can only come through change of land-use, or new construction, as you know.

HON. MR. MACDONALD: Or increased values. And they've been ....

Interjections.

HON. MR. MACDONALD: Come on.

MR. CURTIS: Mr. Speaker, I think we should give the Attorney-General a primer in municipal affairs, because he obviously doesn't have all the information that is necessary to participate in this debate. Now if I could carry on with one more example....

Interjections.

MR. SPEAKER: Order, please. Would the Hon. Members allow their own Member to proceed?

HON. MR. MACDONALD: Come on, he's one of you now.

MR. CURTIS: I'm trying to help the Attorney-General sort this out. I know it is complex, Mr. Speaker, through you.

Mission, 1974: 44.74 mills; projected increase for 1975, 50 mills. Finally, I thought from the District of Coquitlam, the area represented by the Minister of Finance, the Premier of this province, Mayor Tonn, in his reply, gave me the increases and said in the closing paragraph: "It is going to be extremely difficult to meet the increased tax load projected for the new fiscal year, and I sincerely hope the province is going to provide additional per capita grants and reduction in welfare costs for 1975." Some hope, Mayor Tonn of the District of Coquitlam, Mr. Member for West Vancouver–Howe Sound (Mr. L.A. Williams).

I have attempted tonight to point out that the situation in local government is in a crisis stage. Let no Member of the government side of this House attempt to tell us otherwise today, tonight, tomorrow or next week.

I realize that the Premier is not here, but he probably reads or is told about Hansard the following day. If, as the Minister of Highways (Hon. Mr. Lea) indicated in his comments this afternoon, we are heading for a provincial election this year, as he did in fact indicate — seriously or in jest I'm not sure — I would suggest in the interests of his party that the Premier make absolutely certain that the election is called and held before British Columbia taxpayers open their property tax notices.

HON. L. NICOLSON (Minister of Housing): It is a pleasure to speak against this amendment.

MR. CHABOT: Tell us about the Casa Loma scandal.

HON. MR. NICOLSON: We have heard a great deal just now about the municipalities. I think it should be very clearly on the record that while that Member has talked about increases in mill rates, there have been for years and years increases in assessments. What is even more to the point is the record of that group over there that seems to be washed anew. I don't think it washes too much with the people of this province.

What was their attitude toward social assistance? They increased social assistance payments and the burden on municipalities or the share to municipalities from 10 to 15 per cent. We reduced it. That is the record of this government as against the record of that opposition group.

But that isn't all. The Department of Housing. When I came into the Department of Housing and the Minister of Municipal Affairs (Hon. Mr. Lorimer) introduced me to the department we had inherited, namely Mr. Williams, I found out that one of the reasons it was thought that public housing was unacceptable to the municipalities wasn't that it didn't pay taxes — public housing pays taxes — but that the municipalities had to pay 12.5 per cent of the operating subsidies, the highest in Canada at the

[ Page 402 ]

time.

We have reduced that to zero per cent. The province pays; the municipalities do not have to pay for any of the operating costs under section 40 or section 44 of the National Housing Act. In fact, we are one of the only two provinces, I believe, in Canada that make no charge to municipalities for public housing. Public housing pays full municipal taxes. There is no burden to the municipalities.

MR. L.A. WILLIAMS: You speak with your hands in your pockets.

HON. MR. NICOLSON: I am a school teacher; that is my privilege to speak with my hands in my pockets, Mr. Member for West Vancouver–Howe Sound. As a lawyer, you can put yours in your vest. But I am not a lawyer. I don't have a vest.

MR. L.A. WILLIAMS: Take the hands out of your pockets.

HON. MR. NICOLSON: Another interesting contrast between the policy of that group and the policy of this group is with the Elderly Citizens' Housing Aid Act. They brought in a very fine programme but they had a budget which was less than one-sixth, about one-eighth of what our budget is.

MR. J.R. CHABOT (Columbia River): Tell us about Casa Loma.

HON. MR. NICOLSON: That is all they needed because they made it a condition that elderly citizens' housing had to be given an exemption from municipal taxation by the local municipalities. It has been the position of this government and of my Ministry that elderly citizens' housing should pay its full way as public housing under section 40 or 43. Housing under section 15 should pay its fair share of municipal taxes. That extra burden, of course, should not fall on the senior citizens; it should be borne by making section 44 housing subsidies available on section 15 projects on which this government, as the previous one, paid one-third of capital costs. It makes a better contribution towards senior citizens housing than any other jurisdiction in Canada.

MR. L.A. WILLIAMS: Well, you are doing it, aren't you? That is your admission.

HON. MR. NICOLSON: I made a position in my position paper in the federal conference in Ottawa on January 30 of this year that, as we have such a great preponderance of section 15 housing, and the majority of our housing is made under that vehicle. I said that we need agreement from the federal government to participate in the cost of rent subsidies under section 44 of the National Housing Act for non-profit and cooperative housing.

As far as British Columbia is concerned, we are prepared to pay 50 per cent of the cost of subsidies, and we expect Ottawa to join us on an equal basis.

Although we prefer to generally develop our senior citizens' housing by providing non-profit societies with one-third capital grants, I would remind the federal government that a much greater Central Mortgage and Housing Corp. Investment would be required should they have to rely instead on section 43 programmes.

I am proud to say, Mr. Speaker, that as a result of that conference there has been one move made by Central Mortgage and Housing. Two days ago the Hon. Barney Danson announced that these very same section 44 subsidies which I had requested will now be made available for 25 per cent of the units in non-profit sponsored housing, municipally sponsored housing and cooperative housing. That is a victory for this government, and it is a victory for the people of British Columbia and for the municipalities of British Columbia, because it means that more of these projects will be able to pay their fair share of taxes.

I'd like to congratulate the municipalities, which even today are granting some tax exemptions in order that these things can fly.

We have also talked about the record of this government and the sewage treatment plant assistance Act and the phantom programme of that government that paid out just over $200,000 as opposed to over $5 million by this government, Mr. Speaker, when you add those up and you put those costs into increases in per capita grants, the record of that Minister who has spoken this evening, the Minister of Municipal Affairs, and the record of this government stacks up so favourably.

Hon. Mr. Nicolson moves adjournment of the debate.

Hon. Mrs. Dailly moves adjournment of the House.

Motion approved.

The House adjourned at 10:58 p.m.