[ Page 55 ]

CONTENTS

Routine proceedings

Throne speech debate (amendment)

Mr. Wallace — 55

Mr. Levi — 57

Ms. Sanford — 59

Mr. Lea — 62

Hon. Mr. McGeer — 65

FRIDAY, MARCH 19, 1976.

The House met at 2 p.m.

Orders of the day.

SPEECH FROM THE THRONE

(continued debate)

On the amendment.

MR. G.S. WALLACE (Oak Bay): Mr. Speaker. I have very little to add. But to deal with the other two points in the amendment — namely the question of the young driver and the abolition of the northern subsidy and just very quickly to recapitulate our position: we recognize that ICBC should be self-sustaining; that a deficit existed and had to be dealt with. I won't repeat the comments regarding the manner in which this situation was handled — I think I covered that before the lunch break — but we do feel that it was rather a severe, sudden and harsh approach to try and solve the problem all in one step, and it did cause sudden and severe financial problems for many families.

I think the case has been demonstrated that, in some cases, hardship exists in areas where there is no public transit. Since we do subsidize public transit — and I support that concept — there may well be a relatively small percentage of the total of car drivers who would be entitled to some consideration. I think that is an area which should be explored and, for all I know, the government may be exploring that possibility. If there is to be a subsidy for that group, it should certainly be based on need and the proven fact that a person's job and continued occupation might depend on getting to and from work where the automobile is the only way to do so.

But I think we should not lose sight of the fact that we are talking about insurance, and insurance essentially means a premium related to risk. The minute you start fooling around and distorting that basic principle, I think you just get into more and more problems.

One of the speakers this morning talked about an extra gasoline tax and quoted some of the facts — and I accept these facts — as favouring a certain rationale that the more you drive the more gas you use and the more you pay. But I think that does definitely distort the principle of insurance, because if you have a person with a very clean record, a man who may have driven 20 or 30 years without an accident, he may also happen to be employed in an occupation where he drives many miles and burns a lot of gas. Under an extra gasoline tax setup he would finish up paying far more in gasoline tax than he would pay if the premiums were based on the likelihood of his having an accident, based on his record.

So I feel — and I say this with respect to Mr. Straight and others — that the approach of just putting on another gasoline tax somewhat over-simplifies the issue. I feel that, basically, the programme must be self-supporting, with the possible exception of some groups in certain parts of the province, possibly, where hardship exists and there is no alternative transportation.

I would only say this with regard to a specific gasoline tax: it could have been used as a transitional measure, possibly, over a two- or three-year period before we finally catch up and balance the cost completely. And that's referring to my earlier point that I think to try in one move to straighten out this mess was, perhaps, well-motivated; the government was trying to keep a commitment it made in the election campaign that it would put it on a self-sustaining basis. But I personally don't feel that it obligated the government to do it in one single, dramatic and rather far-reaching step.

With regard to the under-25 driver, I feel much the same way as I feel about the person I just quoted, who drives a lot of miles, has a clean record and would be penalized by an extra gas tax. I think it's a very dangerous precedent when we start penalizing people on account of their age, because we are dealing again with insurance: you pay a premium according to your risk. And while there are more people under 25 with accidents than there are over 25, that does not mean that everybody under 25 is going to have an accident.

I think that in the kind of society we are living in, where our young people feel it very difficult to understand their elders, their parents and their grandparents, I have heard more bitterness expressed by our younger people on this one issue than I have heard, perhaps, on any other particularly important public issue. That's why I strongly support the concept in the throne speech that there will be a driver-incentive plan for young people under 25. But then again, I just have to ask the question: why a year from now? Why anyone between 17 and 25 who has been driving at least one year — or eight years, in the extreme example, and the record is there to demonstrate — why do they have to spend one more year paying high premiums in order to prove what they've probably proved over the last three or four years, that they are safe drivers? So I think that the concept….

HON. E.M. WOLFE (Minister of Finance): No records.

MR. WALLACE: Well, I think that, once again, if we were to tie it down on that basis, there must surely be the opportunity afforded to the driver. But the onus on the younger driver to prove that he hasn't had an accident — perhaps at least give the

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individual that incentive and opportunity. I know that if I were under 25 — and I often wish I were — I would be glad to be challenged by the insurance authority to say: "We don't have any record of your driving, but if you can prove to us that you haven't had an accident, we'll look at your premium assessment." I'd be delighted to be asked that if I were under 25.

But at any rate, the government is moving in the right direction in accepting the fact that every driver under 25 should not be given a blanket kind of penalty.

The only other element in that part of the argument is that I hope that the overall planning of ICBC will accept the same principle that for drivers, regardless of age, the safer and better driver you are should merit a discount, and the driver who is causing accidents should certainly continue to pay more and more.

The last point in the amendment is the question of the northern and interior drivers. It's really rather interesting, and to comment on that element in the amendment is very easy because your own back bench covered it very thoroughly yesterday. The member for Omineca (Mr. Kempf) — I'd like to quote him — spoke in the debate yesterday:

Mr. Speaker, there are two things that motivated me to seek a place in provincial politics. One was the wish to represent such a people — northerners, hard-working and patient people accepting as their lot, with very little complaint, the fact that they live in an area in which it costs more to buy groceries and clothing, heat a home, drive a car and do almost anything else than it does in the lower third of this province. Yet these people are asked to be satisfied with less, less in the way of medical and hospital facilities.

I'm not sure that I'd agree with that part if you know what goes on in greater Victoria, but anyway:

... less in the way of medical and hospital facilities, recreational facilities. Some even do without the very basics such as sewer and water systems.

Just below that there are other parts less relevant, but then he goes on to say:

We find no taxpayer-subsidized transit systems in downtown Omineca.

So I really don't feel that one should take much time of the House on this part of the amendment, and speaking from this side of the House, when the government's own backbencher has articulated the situation very clearly.

I'm sure, if we all remember, quite some years ago the distinguished member for Skeena (Mr. Shelford) was set up as a one-man royal commission to look into the whole question of gasoline prices and the difficulties encountered by people living in northern areas. Certainly, when I travelled into the northern parts of this province months prior to the recent election, again the No. 1 topic that was brought to my attention by all the residents was that everything up north costs more.

It would seem to me that, once again, many individuals have to drive a longer distance to get to work and, as the member for Omineca has pointed out very clearly, there is no subsidized transit service. It would seem to me that here is an area in relation to automobile insurance that you could give the people living in these areas at least this kind of a break. I suppose the argument could be raised that if you start giving them a break on car insurance, do you start giving them a break in bits and pieces on various other costs that they all face by living up north. I just feel that this would not be any kind of precedent; it would simply be a recognition of the fact that residents in certain interior and northern areas should not be penalized simply by living in these areas.

After all, this, I think, is ever more relevant when we keep talking, all of us in this House — past governments and oppositions — about the tremendous contribution these people in the north are often making, as the member yesterday stated, by the development of mining resources and many other natural resources, development of railways to get to lumber and minerals. We praise these people for developing the north, but when they tell us that all their basic living costs are higher and that maybe this should be given some consideration, of course, we seem less than.... I am pleased and delighted to have the Premier applaud that last comment. I am sure he is sincere that the time has come to look at the cost of living difficulties for the northern resident. That's why, if that is an accepted concept by this new government, and I hope it is, it does surprise me a little bit that here was an excellent opportunity to take that first move along that policy path, which apparently for reasons the Minister of Education (Hon. Mr. McGeer) might care to comment on, have not been taken up.

So I do believe that, while the basic idea of making ICBC self-sufficient is sound, for the very fundamental reason that in my view there are more important priorities which are not being met by this government, which I mean to speak about in the main debate on the throne speech — with some exceptions possibly in certain areas, as I pointed out, where real hardship exists — there may be a case for a certain measure of subsidy, where need exists and where it can be carefully measured and supervised. But, by and large, I do feel that in relation to the under-25s and the people in the north, this government has missed an opportunity to show that it has a real understanding of the problems of these two groups, and it has missed an opportunity to recognize that people should not be penalized financially because of their age or because of where they live. Insurance is a premium related to risk and I feel that's fundamental to this whole argument. I hope that it will not be

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further distorted by this government.

AN HON. MEMBER: Come on, Pat, get up.

MR. N. LEVI (Vancouver-Burrard): Mr. Speaker, just before I start, I would like to take the opportunity of welcoming a former member of the House who is sitting in the gallery, the former member for Richmond, Harold Steves. I might suggest, Harold, that if you move over just one pew, you can fall out of there and get three of them all at once, including your successor.

I'm not going to speak very long, Mr. Speaker. I would like to talk specifically about a group of people that have not been covered in the debate but are somewhat in the general description in the amendment, and that is senior citizens. I'm glad that the Minister of Human Resources is in the House because he has the responsibility for senior citizens.

In the province there are approximately 75,000 people over the age of 65 who have purchased automobile insurance, and there are approximately 120,000 people between the ages of 60 and 64 who have purchased automobile insurance. We all remember, I think, very graphically the Premier during his election campaign with another one of his red-bannered ads saying in respect to the senior citizens, particularly those on Mincome, that not only will they receive the same, but they will receive even more. Now we have to look at what has actually taken place.

I would ask particularly that the new member for Delta (Mr. Davidson) pay attention because he has in his riding the largest per capita representation of people over the age of 65 — and I look forward to you getting on your feet and saying something about this. I also look forward to the new member for Coquitlam (Mr. Kerster) — you have people over the age of 65 in significant numbers — and, of course, to the member for Victoria (Mr. Bawlf), where you have the second-highest per capita representation of senior citizens.

Senior citizens, in terms of the rates, have had a bit taken out of their income which was completely uncalled for and has gone along with the kind of attitude that that Social Credit government had developed even before 1972. They don't seem to realize that prior to the NDP government there were only about 1,200 seniors in this province who were in receipt of some kind of assistance up to $191 that would help them live reasonably. We saw the ICBC programme as not only providing reasonable rates, but also being an income-distribution factor so that there would be a greater amount of equality in the province for people to take advantage of the automobile insurance programme. It was referred to, I think, by the Liberal leader, that there had to be some kind of equity in the province.

We developed through the Mincome and a range of programmes the options for seniors to have more disposable income. ICBC was one of those options for more disposable income, and that has now disappeared.

What I am surprised about, and particularly concerned, is that when we talked about Mincome in relation to disposable income, we talked about people over the age of 60. That now has disappeared in this province. There is only a Mincome programme for people over the age of 65.

1 notice the Premier's eyebrows just fell down. Well, maybe we can lift them up again.

Remember, they said they would not only keep Mincome but they would add to it. We made a practice of passing on the cost of living increase to the Mincome programme for all people over the age of 60. This was important. These people live on fixed incomes. They had, for the first time in the history of this province, a large number of people — something of the order initially in 1972 of 110,000 and now somewhere around 100,000, dealing with the people over the. age of 60 — with an opportunity to have a better income.

Now, I was aware the other day of a statement by the minister that the 60 to 64 programme would have to be dealt with in a somewhat different way. But I was not aware, and to my knowledge, nobody else was aware, that as of April 1 the following condition will pertain to Mincome.

MR. SPEAKER: Hon. member, would you please relate…?

MR. LEVI: Oh, I am relating here, Mr. Speaker. I am relating it to the availability of disposable income in order to be able to purchase car insurance.

MR. SPEAKER: Hon. member, will you please wait until I finish the statement before you reply to it? Would you please relate your remarks to the amendment that's before the House?

MR. LEVI: Yes, it relates to the excessive car insurance rates and the failure of the government to do something about it for particular people, and I am dealing with senior citizens.

So here we have some 24,000 people who are in receipt of Mincome who have to pay excessive car rates. Am I on the right track now, Mr. Speaker? Excessive car rates payments, very exorbitant. Then we have a statement by the Minister of Human Resources, or under his authority, in a memo issued on March 15,1976, which says the following:

"In effect, the guaranteed minimum income of persons receiving the federal Old Age Security and Guaranteed Income Supplement or spouse's allowance is increased to $269.30.

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That makes more disposable income available to people over the age of 65, will help them to purchase car insurance, or to be able to afford it to some extent. The Guaranteed Minimum Income for those aged 60 and over not in receipt of the Old Age Security, Guaranteed Income Supplement or spouse's allowance, together with those aged 18 to 59 inclusive receiving Handicapped Person's Income Assistance, will remain at $265 single and $530 married."

Now, every one of them over there campaigned on the basis that Mincome would remain the same and be added to. In fact, what has happened is that you have now created two distinct classifications with one group over the age of 65 getting more than the group between 60 and 65.

MR. SPEAKER: Mr. Member….

MR. LEVI: And you went and you debated this all through the election.

MR. SPEAKER: Hon. member, would you please relate your remarks to the amendment that's before the House?

Interjection.

MR. SPEAKER: If you promise to relate it to insurance. You know the manner in which to relate your remarks to the pertinent matter before the House.

MR. LEVI: Mr. Speaker, surely you are not suggesting that the disposable income for senior citizens has no relevance to the purchase of insurance, when I pointed out that 75,000 people over the age of 65 have purchased insurance in this province? Now really, Mr. Speaker….

MR. SPEAKER: Hon. member, all I'm pointing out to you….

MR. LEVI: Yes, I know what you're pointing out to me.

MR. SPEAKER: Please relate your remarks to the amendment that is before the House.

Interjection.

MR. LEVI: Yes, he did. Yes, his eyeball dropped, and I noticed he gave him the eye.

Anyway, those are the facts in relation to the difficulties created…. Those are the facts, you know, right out of the Minister of Human Resources' (Hon. Mr. Vander Zalm's) own mouth.

HON. W.R. BENNETT (Premier): Like your old budgets used to be.

MR. LEVI: Ah, yes, boy, but you're going to come in here with $25 million under. I wonder why! I wonder why!

Interjection.

MR. LEVI: Yes, I wonder why! We know about it. We lived through the period of your father and it looks like we are going to repeat it again. You know what they say: if you don't know some history you're going to have to relive it, and, by God, in this province they are going to have to relive it. Yes, Mr. Speaker….

Interjections.

MR. SPEAKER: Order!

Interjections.

MR. LEVI: Oh, listen. There he is, the Minister of Economic Development (Hon. Mr. Phillips), the guy with the leather lungs who talked his way into the cabinet literally. And the guy next to you is going to talk his way out of the cabinet in really quick order. That's good thinking, Mr. Premier. That's what you have to do. You take the troublemakers in and you pick and you throw out the goofs — and you've got some, by God.

But I'm also interested that when those people over there get up to speak…and of course I'm not only talking about the new boys. I know that the member for Dewdney (Mr. Mussallem), the Whip, has got a long list of people who are just dying to get up into this debate and talk about car insurance, yes, indeed. But I want to hear from the Attorney-General (Hon. Mr. Gardom) who, in a moment of graciousness one night on the television, said, "I want to hear from the people of the province."

Did you hear from them, Mr. Attorney-General?

Interjection.

MR. LEVI: Mr. Speaker, he heard from them. You were listening?

HON. G.B. GARDOM (Attorney-General): Divided opinion.

MR. LEVI: Oh, divided opinion. Well, that's very good. You see, there we have a fact, divided opinion.

Interjection.

MR. LEVI: It is important in this debate that we

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hear from the northern members, that we hear, as I said, from my friend, from my new colleague for Delta (Mr. Davidson), from the minister who represents Surrey (Hon. Mr. Vander Zalm), and for Richmond (Hon. Mr. Nielsen). I see Hal Steves has moved over. You had better be careful. They should be up and talking about this. We should also hear from the Minister of Consumer Affairs (Hon. Mr. Mair).

HON. K.R. MAIR (Minister of Consumer Services): Services.

MR. LEVI: Oh, Consumer Services. I'm sorry, Mr. Minister. He's in good shape now. He's got a Honolulu tan. He looks well and he's in good form, and this should tell us. I think it's his only salvation in relation to the rates, the car insurance rates in this province….

interjection.

MR. LEVI: Yes, we were there. Yes. Socialists go to Hawaii as well as the capitalists. (Laughter.) We can afford it.

HON. D.M. PHILLIPS (Minister of Economic Development): You were everywhere else in the world at the taxpayers' expense, too.

MR. LEVI: Now watch it, Donald.

MR. SPEAKER: Order!

MR. LEVI: I think that the only opportunity now, the only opportunity that is going to exist for the government to understand the import of what they've done in terms of the lifting of these rates to the really monstrous levels that they have done, is going to come from that body in Canada that is responsible for restraint. That, after all, is the theme of the budget, restraint, so what we are going to have to do, we are going to have to rely on that agency of restraint, the anti-inflation board, to roll back the prices.

I think that the next campaign that has to take place in this province in respect to car insurance rates has to come from the public in writing as vigorously as possible, as vigorously as they certainly have done in this recent campaign where the former Minister of Health, the member for New Westminster (Mr. Cocke), received over 200,000 signatures. They should get in touch with the anti-inflation board and point out to them how inflationary these increases are and how far from the concept of restraint, which is after all what the theme of this is going on in this country. This is not restraint in terms of what is happening to senior citizens.

1 am waiting quite patiently to see which of the members on the other side are going to get up and defend the senior citizens. I hope you'll be the first one, Mr. Premier, because you had a lot to say about what you were going to do with senior citizens, and all you've done so far is take it away from them. You've just taken…. Oh yes, you can shake your head, but that's what you've done.

There are senior citizens out there as of April 1 who are going to get less money than other senior citizens on Mincome, and that's not what you said on the hustings. That's not what you said. You said: "More — we'll give them a little bit more." You're going to give it to them all right, like your colleague alongside there. You're going to give it to them in the ear.

MS. K.E. SANFORD (Comox): I've been waiting for some of the backbenchers from the government to rise and speak in favour of this amendment, because obviously they represent ridings which are similar to mine and because of the removal of the territorial equalization formula I expected to see them up on their feet.

Interjections.

MR. SPEAKER: Order!

MS. SANFORD: Mr. Speaker, like all members of this House I have received dozens and dozens of complaints about these exorbitant increases in car insurance rates. People of all ages have come to me and said: "Those who are now in government are heartless people." Mr. Speaker, "heartless people. Don't they know what it's like to be on a low income and have to face increased rates of this type?"

Heartless, is the word that I hear over and over again in connection with these new increases. I've had dozens of letters as I indicated, but there's just one that I would like to read a part of today, and this is one that has been sent to the minister responsible and it comes from a gentleman on Hornby Island, who says:

" Sir, Enclosed you will find my autoplan vehicle insurance and licence renewal. I have been driving motor vehicles for 20 years — farm tractors, motorcycles, cars and trucks — and I've never had an accident."

He goes on to say:

"To continue to support myself, wife, two children and farm, a vehicle will be essential."

Then he goes on to talk about his new insurance rates and says to the minister very sincerely:

"I cannot afford to pay for the new insurance. I simply do not have the money. I see alternatives open to me: Number one, buy the insurance and go without food and fuel.

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Number two, not buy the insurance, park my vehicle and lose the means of my small income, then apply to Human Resources for social assistance."

AN HON. MEMBER: Let them eat cars.

MS. SANFORD:

"Or number three, not buy the insurance, continue to drive and risk being arrested. None of these alternatives appeal to me."

He ends up 'his letter by asking a question: "As minister in charge of ICBC, what do you advise me to do?"

This letter, Mr. Speaker, was written on February 5. It indicates that a copy has gone to myself as MLA for Comox. I did not receive any copy of any answer from the minister to my constituent, so on March 10, I wrote to the minister in charge and asked him please to send me a copy of his answer to my constituent on Hornby Island.

Mr. Speaker, I have not received any copy of any answer. As far as I know, my constituent is still waiting for some help from the minister as to what he should do in view of the fact that he can't pay these increased premiums.

What is that minister advising — that he go on welfare?

AN HON. MEMBER: That he drive a shovel.

MS. SANFORD: We were faced with considerable arrogance from the minister when he suggested that people should sell their cars. That arrogance is now being compounded by the fact that he doesn't answer people like this, giving them some advice as to what they should do.

In a riding like Comox, we have a situation which is similar to the one in Omineca that was raised by the member for that riding (Mr. Kempf) yesterday. Downtown Omineca doesn't have a transit system; neither does downtown Comox. In my riding, a car in most cases is absolutely an essential. It's a necessity. The member yesterday in seconding the Speech from the Throne indicated to the House that downtown Omineca did not have a transit system. He also said that he was speaking on behalf of all of the people of the north and he expressed concern about their health care, about their road system and about education. But, Mr. Speaker, he didn't mention anything about the loss of the territorial equalization programme introduced by the former government. Not a word. He was worried about the fact that people in Omineca pay 20 cents more per gallon for gasoline and mentioned that in his speech. I would expect that that member, who is concerned about the higher cost of living in Omineca, will support this amendment, because here's a chance to show that equalization can take place in this province. It was done by the previous government. Now it's been undone. Mr. Member, I call on you to support us in this amendment.

[Deputy Speaker in the chair.

MR. J.J. KEMPF (Omineca): I'm not convinced; I haven't read it all yet.

AN HON. MEMBER: It will take you some time.

AN HON. MEMBER: Get someone to read it for you.

Interjections.

MS. SANFORD: Mr. Speaker, I was reading the Prince George Citizen just recently and I have the edition of January 7, in which the hon. member for Omineca is quoted in the paper, and I think that based on the statements that he made on that day, he will most likely support this amendment. I would like to quote some of these. January 7, Prince George Citizen. This is a statement by Mr. Kempf:

"'It is high time automobile insurance rates were equalized throughout British Columbia.' He also said: 'Proposed increases are far too high and are going to have to be modified.'

"'I am amazed' he said, 'that ICBC is proposing to eliminate the territorial discount for northern motorists. Far from being eliminated, the territorial discount concept should be expanded so drivers would be paying the same rate for the same insurance coverage everywhere in the province.' He said he finds it very disturbing that the proposed giant increase in ICBC rates was announced before there had been any consultation with the Socred caucus."

AN HON. MEMBER: Political interference.

MS. SANFORD: Does the Premier and the minister responsible not have any respect for the opinions of those who are representing the rest of this province within their own caucus? All of these decisions were made without any consultation at all. These people are coming down here trying to get some equality and some recognition for their ridings, and all of these things are being done without even consultation.

Interjections.

DEPUTY SPEAKER: Order, please.

MS. SANFORD: In the Prince George Citizen there was also an ad which says…. No, I'm sorry,

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this isn't; this is the Terrace Herald — an ad which was run by the then candidate Cyril Shelford, now
MLA for Skeena, who ran an ad during the campaign in the Terrace Herald, which says the following, and this is interesting: "First Barrett tells us to go back to work for 8.8 per cent, and then he tells us he is putting up car insurance 19 per cent. What will the real increase be after December 11?" One might well ask what the real increase will be after December 11.

Well, the member for Skeena has found out what the real increase is: 100 per cent, 200 per cent, 300 per cent or more. That's what it is. I certainly expect that, based on this ad, that member will be supporting this amendment.

MR. D.G. COCKE (New Westminster): Hear, hear!

MS. SANFORD: Back in the Prince George Citizen, January 5. There's a headline in that paper of January 5 which says: "Lloyd Hits Own Party For ICBC Hikes." And there's a smaller headline which says in the same article: "Use Gasoline Tax, Fort George MLA Says." Transfer the gasoline tax, is what he's suggesting here. I certainly expect that the member for Fort George (Mr. Lloyd) will be standing up and explaining to his government how this can be done so the kind of increases faced by the people in the northern part of the province can be changed.

MR. G.V. LAUK (Vancouver Centre): No, he's been muzzled, too.

MR. COCKE: He's out phoning the Prince George Herald.

MS. SANFORD: Citizen.

MR. COCKE: Citizen. Pardon me.

MS. SANFORD: I would like to quote from the article which appears under that headline. This is the member for Fort George:

"This is just too big a hike. There is no way rates can be doubled or tripled without causing hardship to a lot of people."

The article goes on to say:

"Lloyd said about the giant increases in insurance rates, '…very surprised and disappointed, and particularly disturbed that the equalization provisions for northern motorists will be done away with. The equalization provision established by the former NDP government was long overdue.'"

"Long overdue," says the MLA for Fort George — that the work done by the NDP government in establishing these territorial equalization programmes was long overdue. He also says that it is only fair, since the cost of operating a motor vehicle in the north is much higher than on the lower mainland.

I'd like to quote again the member for Fort George:

"If the insurance rate on commercial vehicles is increased so drastically, a lot of people are going to be forced out of business."

And further in the article the member for Fort George says: "I cannot see any justification" for the elimination of the territorial variations.

Surely that member today will support us in this amendment. There are others: the member for North Okanagan (Mrs. Jordan) was quoted as being opposed to the new rates. The member for Fort George (Mr. Lloyd) announced to his constituents that he was coming to Victoria so that the government could have a second look at the announced rates. When he returned he said that, yes, they'd had a second look and they'd gone up even more. As the Prince George Citizen said, with tongue in cheek: "I hope he doesn't request a third look."

Mr. Speaker, it's unfortunate you won't be voting on this today, because surely…. Oh, we have the other Speaker in the chair. I was thinking of the Speaker, member for North Peace River (Mr. Smith), who would surely have to support this amendment. What of the Minister of Agriculture, the member for South Peace River (Hon. Mr. Phillips)? All these people are representing constituents who have been hard hit by these exorbitant increases.

If the northern members, as was suggested by the hon. member for Omineca (Mr. Kempf) yesterday, are going to represent their people and be "truly concerned," then you must support this amendment. Your constituents have been hard hit, and I certainly hope, Mr. Member, that you will get up and speak on this issue today.

One final thing. I received in the mail a parcel; I haven't opened the parcel, but I can see that it does contain license plates, and it also contains an insurance renewal form. It contains a poem and it contains a letter. The person who has sent me these license plates is one of those who has sold his car.

Interjections.

MS. SANFORD: Mr. Speaker, the letter is very brief:

"Dear Karen:

Could you please give these to McGeer? He knows what to do with them.

Yours truly,
William Miles,
531 9th Ave.,
Campbell River, B.C."

There are people in the northern constituencies and in the interior constituencies who are facing the same kind of problem. Let's hear from them today. Would you kindly deliver that to the hon. minister?

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MR. G.R. LEA (Prince Rupert): Was there someone over there who wanted to speak first? No? (Laughter.)

Mr. Speaker, I, of course, rise to support this amendment. The only thing that surprises me about the car insurance rates is: why is anybody surprised? You know, give me a good grass-roots, hard-working, ordinary Socred any day over a right-wing, academic, elitist Liberal. At least working people in the Social Credit Party understand what it's all about. As backbenchers in the government have pointed out since these new rates were announced, they don't agree with them, because they are ordinary people representing ordinary people in their ridings. They understand what it's all about.

Interjection.

MR. LEA: Most of them have started from humble beginnings…

AN HON. MEMBER: Not all.

MR. LEA: …if not all of them, and understand what poverty is about, hardship is about, what hard work is about, and how difficult it is to get along in this world without having a big government dump that kind of punitive measure on you only because in 1972 a percentage of people in this province had the audacity to vote NDP.

AN HON. MEMBER: Oh, oh!

MR. LEA: We'll show them, won't we, Mr. Big Government? We'll show them so that that never happens again.

MR. W.G. STRONGMAN (Vancouver South): Right.

MR. LEA: Yes. Somebody says that's what the government's trying to do from the backbench.

MR. LAUK: More arrogance.

MR. LEA: Well, the only thing that really bothers me, Mr. Speaker, is that the Social Credit Party made a liar out of every candidate in the northern part of this province.

MR. LAUK: Right.

MR. LEA: Those candidates did not know that they were telling an untruth. They did not. Both the ones who were elected and the one who ran against me who was defeated. But they didn't know. You know, they started with Mincome.

Mr. Speaker, talking about insurance rates and other programmes that the Social Credit were talking about during the election campaign, at an all-candidates meeting in Prince Rupert someone got up at the back of the hall and asked the Social Credit candidate, Roy Last: "We know what you won't touch that the NDP brought in. We know you won't touch Mincome, Pharmacare. You know, just what is it? What are the policies? What are the things that you would touch that the NDP brought in?" He said: "That's a damn fool question. It's just nonsensical and I don't have to answer it."

Now I'll tell you why he said that. He was also a broadcaster, Mr. Speaker, and he was talking about car insurance rates on his programme prior to the election. He was talking about other programmes. On his last broadcast, he said: "I've considered all the parties. I've looked at the car insurance rates in this province. I've looked at the policies of all the parties and I've decided, dear listeners, after studying the policies of the Social Credit, that I agree with them and I'm going to run on that party's ticket."

A little later on, at another all-candidates meeting, someone asked him about education, and he said: "I can't answer that. I haven't received the booklet yet outlining the policy of the Social Credit."

AN HON. MEMBER: There wasn't any.

MR. LEA: Now I feel sorry. There was a mail strike. Maybe that was it. But I feel sorry for all those northern MLAs and those interior MLAs who went out on the hustings and said: "We are going to make car insurance just a little better for the average citizen. We are going to make Mincome just a little better for the elderly." But what has happened? Well, we've had testimony from other members talking about quotes from papers from those northern MLAs. We had a speech yesterday, Mr. Speaker, from the Member for Omineca (Mr. Kempf) talking about some of the disparities that exist between southern living in this province and northern living, and I agree with everything he said. But is he going to say it here? In Omineca you're 500 miles away from cabinet; here you're only five seats away.

When I was a minister in the previous government I spoke in Prince George. I spoke about the inequity. I said that there should be a move made by government, of which I was part, to bring some equity into the rates. There was a headline in The Province. When I got back, one or two of my colleagues said: "Are you ever going to be in trouble speaking out against your own government!" I was a little concerned. I was a fairly new minister. I went to the Premier of that day, Dave Barrett, and said: "I guess I've made a mistake, but I don't care."

He said: "You haven't made a mistake, because any time you do not speak out of conscience, then you make a mistake."

[ Page 63 ]

1 suggest to you, Mr. Speaker, on car insurance rates, there are members in this House who unless they rise in their place and let it be heard — their opinions that they have already expressed in newspapers in their own ridings — then they are speaking politically in this House supporting the executive council only and not the constituents that they were sent here to represent. They are not.

This is the forum, Mr. Speaker. This is the forum to stand up and be counted and to represent your riding, and you don't do it only in the newspaper hoping, just hoping, that nobody down south will understand or read that you made the statement. It's okay for the people back home to read you are fighting for them — back home — but what about down here where the Premier can hear you, where the executive council can hear you, and in more particular, where the Minister of Education (Mr. McGeer) responsible for ICBC can hear you?

Stand up now. Stand up now, because if you go home and say one word in the paper, I'll make sure that everybody there gets a copy of Hansard.

HON. MR. PHILLIPS: Don't threaten the new members.

MR. LEA: I'm threatening. I'm threatening that the truth will be told in those constituencies, Mr. Speaker, about car insurance rates.

Interjections.

AN HON. MEMBER: Where's your leader?

MR. LEA: It seems rather strange, Mr. Speaker, to have mouthless defenders of the north. It seems rather strange that all of those members who were voted in good faith for the Social Credit Party are now ruthless defenders of their constituents.

AN HON. MEMBER: Hear, hear!

MR. LEA: But I fully expect that they will not be that way for long. They'll take their place and stand up in this House. The Premier has just told you to — it's okay. It's okay if you stand up now.

MR. D.F. LOCKSTEAD (Mackenzie): Which one?

MR. LEA: Oh, let's take…which Premier? The Member for Omineca (Mr. Kempf), the member for North Okanagan (Mrs. Jordan), the member for Columbia River (Mr. Chabot), the member for Skeena (Mr. Shelford), the member for Fort George (Mr. Lloyd)….

AN HON. MEMBER: Hey, I'm over here.

MR. LEA: Who is it over there? I haven't got used to all the faces yet. But, believe me, when I tell you this car insurance business is the way to get into the cabinet…. There's only one way: speak out frankly and truthfully back there and they won't be able to afford to keep you out of the cabinet. They'll have to take you in. That's the only way.

You know, it's all very fine, it's all very fine for ministers of the Crown to talk about all Crown corporations paying their own way. It would be nice, Mr. Speaker. It maybe shouldn't be all the time, but one minister was quoted in the press as saying: "When we were government before, they all did." And the one he referred to was the B.C. Ferries.

Do you remember the big stink in the House, Mr. Speaker, when they said that the deficit of B.C. Ferries was $35 million? They said it never happened when they were government before. Well, from the years 1963 to 1966, as I am sure the hon. Minister of Labour (Hon. Mr. Williams) will remember, $107 million went into the B.C. Ferries — $41 million went in from toll bridge money and $66 million went in from general revenue.

Interjections.

DEPUTY SPEAKER: Order, please.

HON. P.L. McGEER (Minister of Education): Flim flam.

MR. LEA: Oh, not to pay for losses, not to pay for losses. I notice, Mr. Speaker, we are talking about Crown corporations.

DEPUTY SPEAKER: Order, please. Will you please relate your remarks to the amendment before us?

MR. LEA: Yes, I am, Mr. Speaker, because paying those kind of exorbitant car insurance rates — I am talking about Crown corporations that have to pay their own way — it relates to all Crown corporations and the principle of Crown corporations paying their own way.

DEPUTY SPEAKER: It sounds like a very distant relative, Mr. Member.

MR. LEA: No, I don't think so.

DEPUTY SPEAKER: Please keep your remarks to the amendment before us.

MR. LEA: Yes, I will surely try, Mr. Speaker. But, are we going to take the B.C. Medical Services in this province and say, "I am sorry," like car insurance, Mr. Speaker? "I am sorry if you can't afford it; stay

[ Page 64 ]

sick and don't go in the hospital." Is that what it's all about? I would hope not, but every indication seems to point out it's happening that way. Now there's a basic principle here, Mr. Speaker, when it comes to car insurance, because it can relate to the principles that are being put forward by government in almost every other area — in almost every other area. They talk about cutting the MLAs' salaries — 35 members: maybe you'll get the vote, Mr. Premier. Maybe you will.

But what are we really talking about? You know that for years and years and years right-wing governments made sure that MLAs didn't get very much. That insured that there was only one kind of person who could come down here in this House and be a representative of the people.

DEPUTY SPEAKER: Order, Mr. Member. Will you please relate your remarks to the amendment? Would you like me to read the amendment again?

MR. LEA: I am quite aware of it.

DEPUTY SPEAKER: Thank you.

MR. LEA: What I am saying, Mr. Speaker, is that pretty soon all the MLAs will probably have to drive here in their cars to get down here. They won't be able to take the plane any more — it would take over 18 trips a year — so it does relate directly to car insurance and how it affects the business of this House, Mr. Speaker. You can see that. (Laughter.)

AN HON. MEMBER: When you were minister, you went by helicopter.

MR. LEA: When I was minister, I went by helicopter, he said. I didn't do that after announcing I was going to rob the people of this province of their income and take a plane to Hawaii.

Interjections.

MR. LEA: It sure wasn't a Lear helicopter, Mr. Premier.

HON. MR. BENNETT: You did it on the sly.

MR. LEA: On the sly? Why do you say that?

HON. MR. BENNETT: You didn't announce it.

MR. LEA: Announce what, Mr. Premier? Oh, you're all mixed up again. You see, you made a smart remark and you couldn't follow it up. No, you couldn't follow it up.

Interjections.

DEPUTY SPEAKER: Order, please, members. Order!

MR. LEA: Oh, yes, keep them in order, Mr. Speaker. I appreciate that. I really do.

No, there's only one thing we're discussing here. We're discussing car insurance. We're discussing whether or not people who are under 25 are going to be made to pay more for their car insurance, no matter what their driving record — no matter.

We're talking about northern residents, and this same principle applies. If you live in Prince George, if you live in Houston, if you live in Fort St. John, if you live in Dawson Creek, Prince Rupert, in Atlin, and you've never had a car accident, your driving record is perfect — you are required to pay more for car insurance to drive your car than someone living in Victoria.

Now, is that right? Obviously the northern members don't agree with that. Do you agree that someone who has never had an accident — who's under 25 with a clear driving record — because he may have an accident should pay more? I'm sure you don't agree with that, backbenchers. Are you going to stand up and talk about it? Are you going to defend those people that the Ominecan said he was so proud to come here and defend and fight for?

MR. J.J. KEMPF (Omineca): Represent them.

MR. LEA: Oh, not fight for them. I'm sorry, I've been corrected. He says he's not here to fight for them, just represent them. But you're sent here, Mr. Member, to represent everyone in your constituency — the poor, the working poor, everyone. And everyone there has to drive their car, as the member has pointed out. It's not downtown Vancouver; it's not downtown Victoria. You need your car for recreation, you need it for work, you need it to get to the hospital, you need it for almost every aspect of daily life.

A car in the north and in the interior is an essential; it's not a luxury in any way. There is no luxury car in the north. If you're a family who can only afford one car, it is not a luxury item; it is a must, Mr. Speaker.

As a must, what are we going to do about it? Are we going to say: "I'm sorry, but we have to balance the books on this one and it doesn't matter whether you can get to the hospital, to the grocery store, to your work. It doesn't matter because we are ideologically bound in a direction and we don't care who falls by the wayside as long as it isn't us"? I know, because when I was a minister I had a car that was supplied to the minister's office, as every minister should.

MR. E.N. VEITCH (Burnaby-Willingdon): Did you

[ Page 65 ]

bring it back?

MR. LEA: As every minister should. Or put in the mileage, Mr. Minister of Consumer Services (Hon. Mr. Mair). You do neither?

HON. MR. MAIR: Neither!

MR. LEA: Neither. Are you going to? Ever?

HON. MR. MAIR: No!

MR. LEA: Ah, we just got him. (Laughter.) That's on record. There's a Hansard here, Mr. Minister, since 1972.

AN HON. MEMBER: What did he say? What did he say?

DEPUTY SPEAKER: Order, please! Would you please address the chair?

AN HON. MEMBER: What did he say? What did he say?

MR. LEA: He's never going to do that, Mr. Member. He's never going to drive a government car or put mileage in.

HON. MR. MAIR: Not as long as I can….

MR. LEA: Ah!

AN HON. MEMBER: Oh, you're already backing off.

MR. LEA: No, I think what we have here is a motion, an amendment that can pass this House if only the members of the government back bench will say in this House what they said at home at the local media and then vote the way they talked.

Now, what we have, Mr. Speaker — my final remark, you'll be glad to find out, Mr. Minister of Economic Development — is that what we have here is, a government that does know the cost of everything. But they know the value of very little. I only hope that their backbench will remind them of a few values in this world and in this province, and not just costs.

It's an awful long way from a nice home in Vancouver–Point Grey to the interior and the north of this province. I suggest that the minister get a helicopter or a plane — or, even better yet, a car — and drive up there and find out what it's all about. Don't stick around Victoria. Don't stick around Vancouver, but go out there and find out what people are thinking. Or go to your backbench; they'll tell you, and you'll change your mind. And I support this amendment.

HON. P.L. McGEER (Minister of Education): I've listened with a great deal of interest to the debate. I'm very sorry, Mr. Member, that the mover of the motion was not as interested in the debate, nor the leader of the Liberal Party, because I think a great many interesting points were made.

I'm very pleased to be here and listen to the debate, because it's been an interesting one. I appreciate the package sent across by the member who spoke a few minutes ago. It says here that I know what to do with it. Just for the member for Oak Bay (Mr. Wallace) I want to read him a little letter I got from the Canadian Hearing Society. It says:

"We wish to inform you that sticking anything in your ear can be very dangerous to your hearing and result in hearing loss. Therefore, in the interests of your hearing health, the Canadian Hearing Society suggests to you that you might find somewhere else to stick it." (Laughter.)

MR. WALLACE: Well, that could be dangerous too. (Laughter.)

HON. MR. McGEER: I do agree with the member on one point, and that is that I subscribe to what he says: that insurance should be based, at least to some extent, on risk. I'm going to come back to that point later.

Mr. Speaker, on December 22 of last year, I became the somewhat reluctant president of the largest, and from the financial point of view, the least successful insurance company in Canada. I was pleased that the Premier had enough confidence in me to assign this difficult task, but I can assure you that it was not one that would have had a long list of volunteers. The situation as I found it on that day could hardly have been more desperate. In effect, the corporation was in receivership. There was no cash. Salaries of the personnel of the corporation could not be paid. There was no money for claims. As of November 30 of last year, the last month the NDP was in office, the unpaid claims of ICBC were $169 million.

AN HON. MEMBER: No dispute.

HON. MR. McGEER: There were unamortized start-up costs of $16 million. In addition to there being no cash, there were two and a half months of the insurance year yet to go and claims were building up at the rate of more than $1 million a working day. It was estimated that the losses by the end of the insurance year would be $181 million. And against all of this, there were only a few million dollars in assets

[ Page 66 ]

of any kind of the corporation. Land and real property, buildings and so on, amounted to $39 million.

Now, Mr. Speaker, to make matters even worse, plans had been made for the new insurance year. Hundreds of thousands of new brochures had been printed, but the books of the corporation showed that these rates, which had been approved by the cabinet, would lead to losses in the 1976-77 insurance year of a further $159 million. Moreover, Mr. Speaker, the rates themselves bore no relation at all to ICBC claims experience. They were merely a modification of rates that had been borrowed from the private insurers in 1972 when Autoplan was first started up.

Officials of ICBC told me there was not sufficient time to bring in any major modifications of this insurance programme. They said that there was no method available within the corporation to finance insurance premiums. A former plan that had been financed by one of the banks had lost $2 million, so there was no prospect of private lenders participating in a loan scheme. The government, on being informed of the current state of finances in the province, realized that it was not in a position to transfer any funds to ICBC and it so informed the corporation.

Mr. Speaker, it was against this background of a plan that could apparently not undergo any major modification, of the lack of any financing system within the corporation, a government lacking any cash that it could transfer to the corporation, that I made my first statements about ICBC after only 10 days on the job.

Mr. Speaker, the loss of ICBC in its first year of operation — to February 28, 1975 — for general insurance was $2.199 million. It is estimated that the total loss for two years, including the year ending February 29, 1976, will be $4.83 million. The loss for Autoplan in its first year of operation was $34.179 million. It is estimated that the loss of Autoplan to February 29, 1976, will be $171.569 million.

I mention these figures because these losses have not been paid. These losses — and I say this particularly to the Member for Oak Bay (Mr. Wallace) who had so much to say about this heartless government — must be paid out of current taxes; they will be general taxes. As the Minister of Education I don't welcome funds being used for today's taxes that otherwise should go to education. I don't welcome funds being used out of today's taxes that could otherwise go to hospitals.

But, Mr. Speaker, this is going to happen this year, next year, the year after and until this debt is paid. That's the heritage of your government: today's taxes taken from hospitals, taken from education, taken from Mincome, to pay for mistakes of the past.

[Mr. Speaker in the chair.]

MR. WALLACE: That's the excuse for the next four years, I suppose. To starving hospitals for the next four years, that's going to be your excuse all the way through.

HON. MR. McGEER: It's fact, Mr. Member; it's undeniable fact. That's what we are here this afternoon to do: to tell the truth to the public of British Columbia.

SOME HON. MEMBERS: Hear, hear!

HON. MR. McGEER: So, Mr. Speaker, this afternoon I am going to lay before the House some of the facts of this situation that have not been told before.

SOME HON. MEMBERS: Oh, oh!

HON. MR. McGEER: In June of 1974 the government announced that its goal was flat-rate car premiums. In other words, it was to pay no attention to risks, to driving records, to performance of any kind. It didn't wish to pay any attention to the under-25 drivers who drive well; it didn't wish to place any penalties on those who drove poorly. The Premier first stated the policy in Kamloops.

HON. MR. BENNETT: What date?

HON. MR. McGEER: May 31, 1974, at a meeting in Kamloops, and he was questioned about it in the House the following Monday, June 3. He said that the government had agreed to this flat-rate concept.

MR. A.B. MACDONALD (Vancouver East): Quote his exact words.

HON. MR. McGEER: In the House he had this to say, Mr. Speaker:

I have instructed the ICBC, as Minister of Finance, to come up with the figures to give us the cost of the new formula that we have agreed in concept to go forward with; that is for the automobile user in this province to offset the increase in the price of gasoline rather than remove or reduce the gasoline tax which would benefit non-British Columbians.

…we've agreed in concept to have a flat rating system, which would ideally bring every automobile insurance premium down in the Province of British Columbia. There are no rebates.

It means that the new rating system will go into effect next premium year, which is March of 1975.

MR. MACDONALD: That's nothing to do with points for bad drivers.

HON. MR. McGEER: Now, on Friday, June

[ Page 67 ]

21, the Legislature passed legislation authorizing the cabinet to subsidize ICBC with up to 10 cents of the then 15 cents per gallon provincial gasoline tax and "such portion as is advisable" of the revenue collected from auto licence fees. Now, it's an important point that at that time this was viewed as a breaking of the commitment given by the Minister of Transport, Mr. Strachan, that no tax dollars would be used to subsidize auto insurance.

Mr. Speaker, on June 11, 1974, in between Premier Barrett's announcement and the passing of this authorization by the Legislature to subsidize with gasoline tax and licence fees, plan Z of the Insurance Corp. was presented to the board of directors.

Plan Z pointed out to the directors that the 1974 Autoplan rates are known to be below the levels required since these rates were set to compare with those in 1972. It was pointed out then, June 11, 1974, that the 1974-75 rates are not high enough and will produce as estimated $35 million deficit. June 11, 1974.

SOME HON. MEMBERS: Shame, shame!

HON. MR. BENNETT: They knew then.

HON. MR. McGEER: In plan Z a budget was brought forward based on the receipt of $61.5 million in gasoline tax — that's 8 cents a gallon — plus licence fees of $49.2 million.

Mr. Speaker, the budget brought forward in plan Z on June 11, 1974, laid out a scheme for the following insurance year, based on the receipt of $110 million worth of revenues from these two sources from the provincial government. With these increased revenues it was estimated that the first year's deficit of $34 million could be paid off, the premium rates could remain the same — that's the 1972 levels — and $37 million would be left over for rate adjustments.

On August 21, 1974, the board of directors approved rate reductions in the form of territorial discounts totalling $37.7 million.

Then, Mr. Speaker, a confidential public relations document was prepared, which somehow got to Jes Odam of The Vancouver Sun. On August 30, 1974, a news story appeared saying that the government faced an Autoplan deficit for that year. The Minister of Transport and president of ICBC, Mr. Strachan, was contacted on that date. He had this to say: he had not seen any estimates which would say that things would not be right with Autoplan. He said that he has seen estimates which say that things will go right with Autoplan, and it could break even in 1974.

AN HON. MEMBER: What's happened to the director? Was he a director of ICBC? President?

AN HON. MEMBER: You mean big John Mika didn't tell him?

HON. MR. McGEER: He was then asked if he denied the existence of a report showing a $38 million deficit estimated for the first year. He replied: "I have no report in front of me." The minister added that he had not seen any report saying that an injection of gasoline taxes would be required that year.

HON, MR. PHILLIPS: Misleading. Shame!

HON. MR. McGEER: The story set out three reasons as to why Autoplan was in financial trouble. First, the premiums were too low. The report on June 11 had pointed out that a $34 million deficit was built into those rates in the first year because 1972 rates of the private insurers had been copied by Autoplan.

In the first six months the claims of Autoplan far exceeded estimates. But then, Mr. Speaker, it was the goal of government to give a flat rate with no incentive at all for safe driving. Lastly, the government had developed a flat rating scheme for the following year which would result in a drop in premium income.

Mr. Speaker, on August 31, 1974, Mr. Strachan said that the media presentation of the story on the government's auto insurance plan was "completely misleading, erroneous, unfounded, and not based on fact."

SOME HON. MEMBERS: Oh, oh!

HON. MR. McGEER: He said that the ICBC operation showed that the company could end up with a nominal loss or break even without any improvement in the accident record.

HON. MR. BENNETT: This was after the June 11th directors' meeting?

HON. MR. McGEER: After the June 11 directors' meeting in which the state of finances had been pointed out in the report on plan Z, after the board of directors' meeting in which a new budget had been developed for the following year based on a $37 million reduction in the premiums for 1975-76.

HON. MR. BENNETT: Shocking!

HON. MR. PHILLIPS: Shame! And the member for New Westminster (Mr. Cocke) was a director. Shame! Shame! You should hang your head.

HON. MR. McGEER: Mr. Speaker, on September 6, 1974, The Vancouver Sun printed the confidential document that it must have had in its possession

[ Page 68 ]

before these stories in August appeared in the paper. It wasn't plan Z that they printed; it was the public information brochure which was based on that and which was intended to sell the public on the advantages of government automobile insurance because the rates were so low.

Now, Mr. Speaker, we are literally paying for those decisions today and will be paying for them for years hence.

AN HON. MEMBER: Shame!

HON. MR. McGEER: The officials of ICBC did not deny the existence of the report. Why should they? They had given correct advice to the government. Their figures were uncannily accurate.

Premier Barrett didn't deny the existence of the document. He said, and this is on September 7, 1974: "I would like to thank The Vancouver Sun for their free front-page publicity." That was one of the few times he ever thanked the Sun.

HON. G.M. McCARTHY (Provincial Secretary): He didn't thank them the other night either.

HON. MR. McGEER: But I don't want the Sun to send us an advertising bill. He said: "I'm sure that if we had announced it, it would have been on page 40 rather than page 1."

The reason why I draw your attention particularly to that news report of September 7 was that it indicates the Premier was well aware of the contents of plan Z. He was well aware of the financial status of the corporation. He was well aware of the public relations report. He knew its contents and he knew its implications and he knew the budget of ICBC for the coming year.

Mr. Speaker, that budget was approved. The same rates applied for 1975-76, except they were reduced by the $38 million implied in the plan Z report in the form of territorial discounts. Now, that budget, of course, required that licence fees and gasoline tax be transferred to the corporation in the amount of $110 million.

I have a copy of the 1975 budget speech of Premier Barrett presented in this House some five months later. It talks about the low premium rates of ICBC, but nowhere in this budget, Mr. Speaker, nowhere will you find a provision for $110 million to cover the known requirements of that budget.

Mr. Speaker, it was a false prospectus. The Premier knew full well it was a false prospectus. The Minister of Transport (Mr. Strachan) knew full well it was a false prospectus. The Minister of Health (Mr. Cocke), a member of the board of directors, who's just left the room, knew it too, Mr. Speaker.

HON. MR. PHILLIPS: He's gone in shame.

HON, MR. McGEER: The government knew it. The corporation knew it. The board of directors knew it. Who didn't know it, Mr. Speaker? The Legislative Assembly that approved the budget didn't know it and the public didn't know it.

How many times I've stood in the House…

AN HON. MEMBER: They set the rates.

HON. MR. McGEER: …and listened to the former Premier (Mr. Barrett) tell us about his open government and castigate the former Social Credit government, but tell us how he was prepared to reveal all. Nothing would be hidden by that socialist government, nothing except the financial facts of this province.

The member for Nanaimo (Mr. Stupich) knew and he tried to warn them. They wouldn't take his advice. He knew, but, Mr. Speaker, no wonder the Legislature approved $110 million for ICBC — and, as the Clarkson, Gordon report shows, there was a good reason for it. A good reason, because the money simply wasn't there. It had been spent for other purposes, and more had been spent.

HON. MR. BENNETT: And he wants to come back?

HON. MR. McGEER: Mr. Speaker, in August of 1975 a new budget was approved by the board of directors which took into account…August of 1975, passed by the board of directors. The operating budget makes provision for the receipt of $110 million from the provincial government based on petroleum taxes and licence fees pursuant to section 16(2) of the Insurance Corporation of British Columbia Act. That report, upon which the approved budget was based, noted that there was an expected increase in claims during the previous year of 26.5 per cent or $53.8 million. It noted that even after the receipt of $110 million from the provincial government there would still be a deficit of $33.9 million for the year ending February 18, 1976.

HON. MR. BENNETT: And he didn't tell the public?

HON. MR. McGEER: The budget deficit, together with the deficit experienced during the '74-75 year, would bring the accumulated deficits, after receiving $110 million, to $68.1 million.

Now, Mr. Speaker, that was August of 1975. Mr. Speaker, even after all of that, a prediction of the state of affairs strikingly close to what will be experienced when the final audit of this year is completed, that government and that board of directors still went ahead and set premium rates for 1976-77 and approved them in the cabinet that

[ Page 69 ]

would have provided for a further $159 million loss.

AN HON. MEMBER: Shame!

Interjections.

HON. MR. McGEER: Now, Mr. Speaker….

Interjections.

HON. MR. McGEER: That's when we came to government. That's what the NDP had done.

Mr. Speaker, in less than two years of the operation of Autoplan, that's what that government had done — not on the basis of any mistakes in the figures that they had received from the corporation management, but based on completely accurate figures, strikingly accurate figures, given months in advance. And in the face of all that data, those were the decisions that that government was prepared to make.

HON. MR. PHILLIPS: That's why Strachan was exiled.

HON. MR. McGEER: Yes, Mr. Speaker, we had to do some very unpopular things. I can assure you that no one having to do that would take any pleasure or satisfaction from it. It was an extraordinarily difficult period for myself, my family, for the government, but that's the price of responsibility if you're prepared to accept it.

Now, Mr. Speaker, I want to talk for just a few minutes about the future. I want first of all to compliment the senior management of the corporation for working literally around the clock for weeks to present a rate structure which was adopted by the cabinet based on actual claims experience.

AN HON. MEMBER: Hear, hear!

HON. MR. McGEER: They worked to produce a finance plan after the banks and lending agencies had declined to do so. They have continued to work at an accelerated pace to try and revise the scope and intent of our insurance system to make it self-sufficient, efficient, fair in its policies to the drivers, free from political interference in the rate setting…

MR. COCKE: How can you say it?

HON. MR. McGEER: …and be able to…

AN HON. MEMBER: You should hang your head in shame.

HON. MR. McGEER: …and be able to…

AN HON. MEMBER: You shouldn't even be here.

HON. MR. McGEER: …and able to deliver to the public the kind of service and attention that they deserve to expect. Mr. Speaker, the members have spoken very passionately today on behalf of the people from the northern and interior parts of British Columbia who've been discriminated against in this new rate structure. Many of them have mentioned it.

MR. LEA: That's right.

HON. MR. McGEER: "That's right," says the Member for Prince Rupert. But they should, Mr. Speaker, first have paid just a little bit of attention to what the rates actually are. They are based on experience, and I'll read them out just for one category: the 01 pleasure drivers, $99 in Victoria; $102 in the Fraser Valley; $104 in the southern interior; $113 on the North Island…

MR. LEA: Collision, too.

HON. MR. McGEER: …$114 in northern B.C. and $137 in the lower mainland.

Interjections.

AN HON. MEMBER: They're as mixed-up in opposition as they were in government.

HON. MR. McGEER: Do you know what that says, Mr. Speaker? It says the people in the north and the interior are better drivers, they have a better driving record and there never should have been a territorial disadvantage in the first place.

MR. LEA: What's the collision?

HON. MR. McGEER: But, Mr. Speaker, under the former government…

AN HON. MEMBER: You're on a collision course right now.

HON. MR. McGEER: …they weren't prepared to look at the structure that they had based on their own experience. They were still borrowing from the private insurance of 1972. That's what we did. We looked at the actual experience and it turned out that the people in the north and the people in the interior deserved lower rates, and they're getting them.

I would like to read one letter because the Member for Revelstoke-Slocan (Mr. King), the acting Leader of the Opposition, had so much to say about the complaints he had received and the discrimination from the people in his area.

This is addressed to Mr. James S. Bennett, no

[ Page 70 ]

relative, who is my executive assistant and, it says:

"Dear Sir:

"I acknowledge your letter of January 13,1976, regarding my complaint about ICBC premiums. I now feel I owe Mr. McGeer an apology regarding said letter, for my auto insurance was renewed today, basic coverage at only $145 with plates. Incidentally, I drive a 1971 GMC pickup."

MR. LEA: Signed, "your loving wife." (Laughter.)

HON. MR. McGEER: "I now feel…." I am enjoying this. (Laughter.) I know you will indulge this little moment of satisfaction of mine, Mr. Speaker, because there have been many painful days.

"I now feel the news media blew this issue out of proportion. It was said that that prompted the initial complaint. Please tell Mr. McGeer I am truly sorry for flying off the handle in my letter. I trust he will understand."

Interjection.

HON. MR. McGEER: Well, Mr. Speaker, I'll be happy to send that member a letter, or file it, and I want you to know….

MR. KING: I'd like a copy. I'll send you the 200,000-name petition in exchange.

HON. MR. McGEER: Mr. Speaker, I want to assure the members opposite that we're as desirous as they are for low automobile insurance premiums, every bit. We don't like the fact that there are so many accidents and that it costs much to repair automobiles. Above all, we abhor the carnage on the highways. I think every member feels the same way. So in the future we are going to do everything we can at ICBC to promote safe driving — a genuine reduction in automobile premiums, based on safer driving.

MR. SPEAKER: Your time has almost expired, Hon. Minister.

HON. MR. McGEER: Mr. Speaker, I just want to say one brief word, if I may, about the under-25 drivers, the male under-25 driver, because, again, we're terribly concerned about this group — not just about the high insurance premiums, but also the cost, the real cost in human terms of the accidents, the social damage that is reflected in the figures that I am about to give you.

The frequency of claims per 100 vehicles of under-25 drivers was 63 per 100 vehicles as against 24 in the pleasure class in the first year of operation. In the second year of operation the frequency was 63 per 100 vehicles — no change — as against 24, once more, for the pleasure group.

The average claim per vehicle for the under-25 driver in the first year of operation was $341. The underwriting loss per vehicle was $138. The average overhead per vehicle for all categories — note this, hon. members — was $30 per vehicle. That's the overhead, and just match that against the initial NDP promise of $25-a-year automobile insurance. The overhead alone during the first year of operation was greater than that.

Interjections.

HON. MR. PHILLIPS: You couldn't run a peanut stand; I told you that three years ago.

Interjections.

MR. SPEAKER: Hon. members….

HON. MR. McGEER: The net result in the first year of operation, Mr. Speaker, was that the under-25 drivers — and there were 103,000 of them — were responsible for 50 per cent of all ICBC losses.

MR. SPEAKER: Your time has expired, Hon. Minister. If you wish to continue, you will have to ask leave of the House.

HON. MR. McGEER: I'm nearly finished, Mr. Speaker. There are only a couple more….

MR. SPEAKER: I must ask you, sir, to ask leave of the House if you are going to continue. You can only continue with leave.

HON. MR. McGEER: Is it the wish of the House that I continue?

SOME HON. MEMBERS: Yes!

MR. KING: Mr. Speaker, I wish the minister would be a little precise and tell us how long he expects to continue before we are asked to consider giving unanimous leave.

HON. MR. McGEER: Approximately three minutes, Mr. Speaker.

Leave granted.

MR. SPEAKER: Continue, Mr. Minister.

HON. MR. McGEER: Mr. Speaker, during the….

Interjection.

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HON. MR. McGEER: Thank you. There are just a couple of….

Interjections.

HON. MR. PHILLIPS: You weren't even in the House for half the debate. You weren't even here. You just hit and run.

MR. SPEAKER: Order, members, order, hon. members. Allow the minister to continue.

HON, MR. McGEER: Mr. Speaker, during the second year the under-25s had an average claim per vehicle of $412 — over three times that of the pleasure vehicles, indicating that it isn't just greater frequency, it's greater severity. The total loss per vehicle, including an overhead in the second year of $43 per car, was $273 per vehicle.

In the first two years of Autoplan we will be subsidizing, on the average, each automobile owned or operated by an under-25 driver to the extent of $41, and that will come, once more, out of current taxes.

Now it may be, Mr. Speaker, that it's severe that we're asking these people to pay their way now. But perhaps they can remember that at the same time funds are being used in this Legislature to pay for the subsidies of the past.

But it isn't just the losses of the insurance corporation that worry this government. It's the severity and the frequency of the accidents. That's why the government will be asking you as a Legislature to approve additional funds as a safe-driving dividend for the under-25 male driver in British Columbia.

There was no incentive, no encouragement to drive well, and the results of that NDP programme have not just been disastrous financially for this category; they have been disastrous socially. So in the future, Mr. Speaker, the insurance corporation is going to be fair to everyone — to reward good drivers, to ask the bad drivers to pay more, to campaign for safer and better driving, and to give the public of British Columbia a level of service that they've never had before.

Hon. Mr. Phillips moves adjournment of the debate.

Motion approved.

Hon. Mrs. McCarthy moves adjournment of the House.

Motion approved.

The House adjourned at 3:43 p.m.