[ Page 2481 ]

CONTENTS

Routine proceedings

British Columbia Educational Institutions Capital Financing Authority Act (Bill

46) Hon. Mr. McGeer.

Introduction and first reading — 2481

Public Schools Amendment Act, 1976 (Bill 55) Hon. Mr. McGeer

Introduction and first reading — 2481

Automobile Insurance Act Amendment Act, 197 6 (Bill 6 1) . Hon. Mr. McGeer

Introduction and first reading — 2481

Companies Amendment Act, 1976 (Bill 76) Hon. Mr. Gardom

Introduction and first reading — 2481

Legal Professions Amendment Act, 1976 (Bill 62) Hon. Mr. Gardom

Introduction and first reading — 2481

Dentistry Amendment Act, 1976 (Bill 70) Hon. Mr. McClelland

Introduction and first reading — 2481

Pharmacy Amendment Act, 197 6 (Bill 7 1) Hon. Mr. McClelland

Introduction and first reading — 2481

Municipalities Enabling and Validating Amendment Act, 1976 (Bill 63) .

Hon. Mr. Curtis

Introduction and first reading — 2481

Oral questions

Lie detector tests for ICBC claimants. Mr. Macdonald — 2482

PWA head office move to Alberta. Mr. Gibson — 2482

Delays in ICBC refunds. Mr. Wallace — 2482

Appointment of Brian Palmer. Mr. Wallace — 2483

Education minister's trip to England. Mr. Lea — 2483

Transfer of BCR management or ownership. Mr. Gibson — 2484

Hospital Services Collective Agreement Act (Bill 75) .

Second reading

Hon. Mr. Williams — 2486

Mr. Lea — 2489

Mr. Gibson — 2490

Mr. Wallace — 2492

Statement

Investigation of Kitimat law enforcement situation. Hon. Mr. Gardom — 2495

Mr. Macdonald — 2495

Mr. Gibson — 2495

Mr. Wallace — 2495

Routine proceedings

Hospital Services Collective Agreement Act (Bill 75) .

Second reading

Mr. Wallace — 2495

Hon. Mr. McClelland — 2496

Ms. Brown — 2497

Hon. Mr. Williams — 2499

Division on second reading — 2501

Committee stage

On section 3.

Mr. Wallace — 2501

Hon. Mr. Williams — 2502

Hon section 4.

Mr. Gibson — 2502

Hon. Mr. Williams — 2502

On section 6.

Mr. Wallace — 2502

Hon. Mr. Williams — 2502

Mr. Gibson — 2503

Hon. Mr. Williams — 2503

Report and third reading — 2503

Mineral Amendment Act, 1976 (Bill 30) Second reading.

Hon. Mr. Waterland — 2503

Mr. Lauk — 2504

Mr. Gibson — 2505

Hon. Mr. Waterland — 2505

Division on second reading — 2507

Railway and Ferries Bargaining Assistance Act (Bill 58) . Hon. Mr. Williams

Introduction and first reading — 2507

Mineral Resource Tax Act (Bill 57) Second reading.

Hon. Mr. Waterland — 2507

Mr. Barnes — 2509

Public Service Benefits Plans Act (Bill 64) .

Hon. Mrs. McCarthy

Introduction and first reading — 2510

Public Service Act (Bill 81) Hon. Mrs. McCarthy

Introduction and first reading — 2510

Public Service Labour Relations Amendment Act, 1976 (Bill 82) .

Hon. Mrs. McCarthy

Motor-vehicle Amendment Act, 1976 (No. 2) (Bill 66) Hon. Mr. Davis

Introduction and first reading — 2511

Motor-vehicle Amendment Act, 1976 (No. 1) (Bill 68) Hon. Mr. Davis

Introduction and first reading — 2511,

Motor-vehicle Amendment Act, 1976 (No. 3) (Bill 80) Hon. Mrs. McCarthy — 2511

Royal assent to bills — 2511

The House met at 2 p.m.

Prayers.

MR. G.H. KERSTER (Coquitlam): Mr. Speaker, I'd like to bring to the attention of the House a major achievement by a young B.C. athlete, Lars Hanson from Coquitlam. His hard work and determination to aspire in the sport of basketball has been recognized by the Chicago Bulls of the National Basketball Association. Yesterday they selected him as their third-round draft choice of U.S. college basketball players. I would ask the House to join me in congratulating Lars Hanson, who leaves his Coquitlam home on Monday to join the Canadian national Olympic team just prior to taking up his professional job with the Chicago Bulls.

MR. E.N. VEITCH (Burnaby-Willingdon): Mr. Speaker, once again it is my pleasure to ask the House to welcome another contingent of students from the Moscrop Junior Secondary School, accompanied by their teachers.

MR. C.S. ROGERS (Vancouver South): Mr. Speaker, in the gallery today are Myron Olsen and Jesse Edwards from the constituency of Langley. I would ask the House to make them welcome.

HON. P.L. McGEER (Minister of Education) Mr. Speaker, today we have special guests of the Legislature who are representatives of the Federation of Independent Schools: Messrs. Ensing, Waller, Kaleb, Friesen and Brown. I would ask the House to bid them welcome.

HON. T.M. WATERLAND (Minister of Mines and Petroleum Resources): Mr. Speaker, I'm very happy to have my wife, Donnie, in the Speaker's gallery today. I ask the House to join me in welcoming her.

Introduction of bills

BRITISH COLUMBIA EDUCATIONAL
INSTITUTIONS CAPITAL FINANCING
AUTHORITY ACT

Hon. Mr. McGeer presents a message from His Honour the Lieutenant-Governor: a bill intituled British Columbia Educational Institutions Capital Financing Authority Act.

Bill 46 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

PUBLIC SCHOOLS AMENDMENT ACT, 1976

On a motion by Hon. Mr. McGeer, Bill 55, Public Schools Amendment Act, 1976, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

AUTOMOBILE INSURANCE ACT
AMENDMENT ACT, 1976

On a motion by Hon. Mr. McGeer, Bill 6 1, Automobile Insurance Act Amendment Act, 1976, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

COMPANIES AMENDMENT ACT, 1976

Hon. Mr. Gardom presents a message from His Honour the Lieutenant-Governor: a bill intituled Companies Amendment Act, 1976.

Bill 76 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

LEGAL PROFESSIONS AMENDMENT ACT, 1976

On a motion by Hon. Mr. Gardom, Bill 62, Legal Professions Amendment Act, 1976, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

DENTISTRY AMENDMENT ACT, 1976

Hon. Mr. McClelland presents a message from His Honour the Lieutenant-Governor: a bill intituled Dentistry Amendment Act, 1976.

Bill 70 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

PHARMACY AMENDMENT ACT, 1976'

Hon. Mr. McClelland presents a message from His Honour the Lieutenant-Governor: a bill intituled Pharmacy Amendment Act, 1976.

Bill 71 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

MUNICIPALITIES ENABLING AND
VALIDATING AMENDMENT ACT, 1976

Hon. Mr. Curtis presents a message from His

[ Page 2482 ]

Honour the Lieutenant-Governor: a bill intituled Municipalities Enabling and Validating Amendment Act, 1976.

Bill 63 introduced, read a first time and ordered to a be placed on orders of the day for second reading at s the next sitting of the House after today.

MR. G.F. GIBSON (North Vancouver-Capilano): Mr. Speaker, as a small contribution with this torrent of legislation, I would move, with leave, that Bill 40 standing in my name under second reading be discharged.

Leave granted.

Oral questions

LIE-DETECTOR TESTS
FOR ICBC CLAIMANTS

MR. A.B. MACDONALD (Vancouver East): Mr. Speaker, I would like to ask the Minister of Education if he's aware that ICBC — and I'm referring particularly to Surrey claims centre and one claimant, but I'm asking the question generally — submits insured people making claims against that corporation to a lie-detector test in connection with their claim, which is stated to be voluntary, but then there is added to that that if the claimant does not take the lie-detector test, ICBC will sit and wait on the claim.

HON. MR. McGEER: No, I'm not aware of that, Mr. Speaker.

MR. MACDONALD: On a supplementary: will the the minister find out, then, what is happening in that corporation?

HON. MR. McGEER: I'd be delighted to make to inquiries, Mr. Speaker.

AN HON. MEMBER: You might not be so delighted with the answer.

MOVE OF PWA HEAD OFFICE TO ALBERTA

MR. GIBSON: Mr. Speaker, a question to the hon. Attorney-General. Now that the Canadian Transportation Commission has, unfortunately, turned down British Columbia's bid to restrain transfer of the headquarters of PWA to Alberta until the supreme court rules on ownership, thereby effectively leaving Alberta free to make irreversible moves detrimental to this province, is the government now prepared to seek an injunction from the supreme court maintaining the status quo until that court rules on the ownership issue?

HON. G.B. GARDOM (Attorney-General): I'd like to thank the member for his question on the point, and also for the one that he earlier directed to me. I'd like to inform the hon. member that new initiatives are underway by the government, and a full statement will be made by the end of the week by the hon. Premier.

DELAYS IN ICBC REFUNDS

MR. G.S. WALLACE (Oak Bay): To the Minister of Education responsible for ICBC, Mr. Speaker. With regard to automobile owners who have taken the minister's advice and sold their cars and have sought refund of the unused portion of the premium, is the minister aware that, for example, such an owner in Oak Bay applied for a refund on May 4 and was told, on phoning the ICBC office in Vancouver yesterday, June 8, that it would be a further eight to nine weeks before he could receive the refund, and that the office refused further discussion on the matter? Is the minister aware of these long delays?

HON. MR. McGEER: No, Mr. Speaker.

MR. WALLACE: Mr. Speaker, since the minister has repeatedly stated that the government will greatly increase the efficiency of ICBC, can the minister tell he House what specific initiatives he has taken to reduce the delay in refunding car owners who sell their vehicles?

HON. MR. McGEER: As I explained, Mr. Speaker, I wasn't aware of the long delay, but I'll take the question as notice and inquire into it and determine exactly what the delay is and why.

MR. WALLACE: Mr. Speaker, while the minister is looking into the question of delays which I assure him do occur, and I'm not just quoting one incident, can the minister take into consideration the fact that since the federal income tax department pays a citizen interest on money outstanding, ICBC will look at the possibility of paying interest on money for which the car owner might wait many months?

HON. MR. McGEER: Well, we have to determine whether the car owners are waiting many months, Mr. Speaker.

MRS. B.B. WALLACE (Cowichan-Malahat): As a supplementary, my question involved a three-month wait and $400 in one instance. But as a further supplementary, Mr. Speaker, I wonder if the Minister f Education can explain to me why I received these two notices in the mail this weekend from ICBC. They are sent out as an inspection notice from ICBC indicating that I'm required to have my vehicle

[ Page 2483 ]

checked within 10 days of receipt, and yet one vehicle expires December 15,1976, the other January 16,1977. Why am I getting this sort of notice? Is there a change in policy?

HON. MR. McGEER: Mr. Speaker, there's no change in the policy that all car owners should have regular inspection of their cars for safety purposes.

APPOINTMENT OF MR. BRIAN PALMER

MR. WALLACE: I'd like to ask the Provincial Secretary a question with regard to order-in-council 1531 which appointed Mr. Brian Palmer as administrative assistant to the Speaker's office at $19,000 per annum retroactive to April 1. Can the minister tell the House if this is a new position in the Speaker's office and whether Mr. Palmer will be working out of the Speaker's office or out of an office in the North Peace River constituency?

HON. G.M. McCARTHY (Provincial Secretary): Mr. Speaker, I'll take that question as notice.

EDUCATION MINISTER'S TRIP TO ENGLAND

MR. G.R. LEA (Prince Rupert): Mr. Speaker, a question to the hon. Minister of Education. Has the minister, since assuming his office as a cabinet minister, been to London, England?

HON. MR. McGEER: Yes, Mr. Speaker.

MR. LEA: Could the minister tell me whether or not that trip was on government business, and, if so, was he accompanied by anyone — specifically directors of ICBC?

HON. MR. McGEER: Yes, Mr. Speaker, I was accompanied by the general manager, the senior vice-president and one member of the board.

MR. LEA: Supplementary: could the minister tell us the purpose of the trip?

HON. MR. McGEER: Yes, Mr. Speaker, it was to attempt to clean up the mess that was left behind by the New Democratic Party in their insurance programme. I can tell you, Mr. Speaker, that it isn't an easy job.

MR. LEA: Supplementary, Mr. Speaker. I would again like to ask the minister: what was the purpose of the trip to England on government funds that was cloaked in secrecy? No one knew that that minister had gone....

Interjections.

MR. SPEAKER: Order, please. What is your question?

MR. LEA: He didn't answer the question.

MR. SPEAKER: What is your question?

MR. LEA: I would like him to answer the question: what was the purpose of the trip to England?

HON. MR. McGEER: Mr. Speaker, I wish to repeat for the member: the purpose of the trip was to try and clean up the many problems that have been left behind in the reinsurance programme of ICBC which involves millions of dollars each year which is done primarily through Lloyds brokers in London, and which was left in a dreadful mess by the New Democratic Party.

AN HON. MEMBER: Hear, hear!

MR. LEA: Mr. Speaker, as a supplemental I would like to ask the minister: what was the purpose of the trip to London, England? In fact, he has not answered that question.

MR. SPEAKER: Order, please! You may not agree with the hon. minister's answer, but he did answer the question that was asked him.

MR. G.V. LAUK (Vancouver Centre): On a supplementary to the same minister, could the minister indicate what officials of Lloyds of London he met with and how long was the trip? How many days in London?

HON. MR. McGEER: I was in London....

MR. WALLACE: Did you meet the Queen?

HON. MR. McGEER: No, but I did meet the president of the Lloyds group. I met the chief underwriters for all of the ICBC reinsurance programmes and I met with the underwriting brokers, which are Payne and Company and Bowring and Company. So we saw the brokers to whom we underwrite, we saw the underwriting syndicates and we saw the chief executive officers of Lloyds.

MR. LAUK: Supplemental to the same minister. It was indicated to the previous administration — this is back-up to the question — from the Lloyds board and from officials of ICBC, one of whom, according to your answer, evidently was with you, that the reinsurance programme with Lloyds was in good shape and was in excellent form. Is the minister now

[ Page 2484 ]

indicating that Lloyds have indicated otherwise to him?

HON. MR. McGEER: At the time that the reinsurance contracts were under negotiation we lost one of the reinsurance programmes, namely the school reinsurance. All of the other reinsurance programmes have been subjected to enormous increases as a result of the improper information that was made available to Lloyds at the time the insurance corporation was commenced. It was suggested to the reinsurance people that the automobile premiums would be sufficient to cover the costs. A two-and-a-half-year contract was signed and then it turns out that the premiums were deliberately underestimated, resulting in losses to the corporation of $181 million. Similarly, Mr. Speaker, it was indicated to the reinsurers that the general insurance programme....

Interjections.

MR. SPEAKER: Order, please! The hon. member for Vancouver Centre on a point of order.

MR. LAUK: I would ask Mr. Speaker to follow carefully the answers of the minister. I asked him: did Lloyds indicate that the reinsurance programme was not in proper form or adequate? He did not answer the question. I have a further question for the minister.

Lloyds of London was....

MR. SPEAKER: One moment please, Hon. Member. You interrupted the minister in his answer by rising on a point of order.

MR. LAUK: He did not answer my question.

MR. SPEAKER: That's your opinion. The minister was answering the question when he yielded the floor to you.

MR. LAUK: That's absolutely incorrect. I asked him what did Lloyds of London indicate to him and he did not answer the question.

MR. SPEAKER: Will the hon. member please take his seat?

[Mr. Speaker rises.]

MR. SPEAKER: Hon. Member, dealing with your point of order, the minister was answering your question. You may not agree with how he was answering it. You interrupted him by a point of order and in courtesy I now have to recognize the minister because he had the floor at the time you interrupted his answer by a point of order.

[Mr. Speaker resumes his seat.]

HON. MR. McGEER: Mr. Speaker, to continue on, there has been a great deal of concern about the losses experienced by the insurance corporation by the incorrect information that was given to the underwriters and to the brokers regarding the adequacy of the premiums being charged by the corporation. I have been under extreme pressure to make this visit to our reinsurers since early in January. Until my estimates were passed by the House I didn't feel it appropriate for me to take any time at all to undertake this journey, important as it was. The principal objective was to attempt, however we could, to restore confidence in the Insurance Corp. of British Columbia by letting people know it was in competent management hands.

MR. LEA: I would like to ask the minister whether while in London the minister took any time off for a vacation, and, secondly, I would ask the minister whether he would agree with me that the press, before accepting any statement in this House on this, should phone and get information from Lloyds of London.

HON. MR. McGEER: I'd be delighted, Mr. Speaker, if they did and I would be happy to table the correspondence regarding the necessity of the trip and my itinerary while I was gone.

Interjections.

MR. SPEAKER: Order, please!

MR. LEA: Final supplemental. I would like to ascertain from the minister whether while in London he took any vacation time — whether it was half an hour, an hour? Did you take any vacation time?

Interjection.

MR. LEA: I'm not American; I'm Canadian.

HON. MR. McGEER: The closest thing that I took to any vacation time was to visit the agent-general in London, Mr. Strachan. (Laughter.)

TRANSFER OF BCR
MANAGEMENT OR OWNERSHIP

MR. GIBSON: Mr. Speaker, I have a question for the Minister of Economic Development. Does he know of any talks within the government or elsewhere with respect to the possibility of selling or leasing or transferring management of the BCR to

[ Page 2485 ]

Canadian National or the Canadian government?

HON. D.M. PHILLIPS (Minister of Economic Development): Mr. Speaker, in answer to the member's question, no direct talks are presently going on but there are always possibilities. This government will take a look at any opportunity which would be good for the people of British Columbia.

Interjection.

MR. SPEAKER: I'm sorry, Hon. Member. The question period was terminated by the bell.

MR. LAUK: Mr. Speaker, during question period the Minister of Education (Hon. Mr. McGeer), in answering questions of the opposition, made several false statements. I wish to ask leave of the House to clarify them.

HON. MR. PHILLIPS: You better withdraw, because it's unparliamentary!

MR. LAUK: Did Dowding tell you that?

Interjections.

MR. SPEAKER: Leave is not granted, hon. member.

SOME HON. MEMBERS: Oh, oh! Shame!

MR. L. NICOLSON (Nelson-Creston): On a point of order, I did not hear you ask for leave.

MR. SPEAKER: In that case, just to make it perfectly clear, Hon. Member, shall leave be granted?

SOME HON. MEMBERS: Aye!

SOME HON. MEMBERS: No!

MR. SPEAKER: There are a number of noes, Hon. Member.

MR. LEA: On a point of order, Mr. Speaker, during this question period and during other question periods, in my opinion, as a member of this assembly, I believe that you are running interference for government. I believe that is not your job. You are running interference every opportunity you get.

SOME HON. MEMBERS: Shame!

MR. LEA: The sooner they take you out of there and put you into.... No, let's not wish any portfolio on you.

[Mr. Speaker rises.]

MR. SPEAKER: Hon. Member, the job of the Speaker is quite clear in question period. It is quite clear to all members of the House, if they wish to operate within the confines of the limits that are laid out for the Speaker in question period.

I ask you to unequivocally withdraw that castigation against the Chair — unequivocally, Hon. Member!

[Mr. Speaker resumes his seat.]

MR. LEA: Mr. Speaker, I said it is in my opinion that you are running interference for the government.

MR. SPEAKER: I ask you to unequivocally withdraw that statement.

MS. R. BROWN (Vancouver-Burrard): You are not protecting the rights of the opposition, Mr. Speaker.

MR. SPEAKER: Unequivocally, Hon. Member!

MR. E.O. BARNES (Vancouver Centre): You're being coached by the Premier, Mr. Speaker.

MR. LEA: Are you following your own dictates or are you listening to the Premier?

MR. SPEAKER: Order, please! Hon. Member, I now order you unequivocally to withdraw that statement.

MR. LEA: No.

MRS. WALLACE: You're an embarrassment to the British parliamentary system.

MR. BARNES: It's about time we had some democracy.

MR. NICOLSON: It's going to be a republic after you pass that bill.

MR. LEA: Because you have ordered me to withdraw, Mr. Speaker, I withdraw unequivocally.

MR. SPEAKER: Thank you, Hon. Member. Before the Clerk proceeds with the business of the day, I would say to the hon. member and all members of the House that attacks such as that are not attacks on the Speaker personally but are attacks on the Chair, on the office and on all members of this House. That is why, Hon. Member, I asked for an unequivocal withdrawal.

Orders of the day

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HON. G.M. McCARTHY (Provincial Secretary): Mr. Speaker, by leave, public bills and orders.

Leave not granted.

HON. MRS. McCARTHY: Committee of Supply, Mr. Speaker.

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

HON. W.R. BENNETT (Premier): Who said no? The member for Nelson-Creston (Mr. Nicolson)!

MR. CHAIRMAN: Order, please! The committee will come to order.

The House resumed; Mr. Speaker in the chair.

The committee, having reported progress, was granted leave to sit again.

HON. MRS. McCARTHY: Mr. Speaker, I ask leave that we proceed to public bills and orders.

Leave granted.

HON. MRS. McCARTHY: Second reading of Bill 75, Mr. Speaker.

HOSPITAL SERVICES
COLLECTIVE AGREEMENT ACT

HON. L.A. WILLIAMS (Minister of Labour): Mr. Speaker, as I rise to debate in second reading Bill 75, I would like to say that I again apologize to the members for not having the bill in printed form and all of the material fully available. I trust that in the time since the bill was introduced last evening, the members have had an opportunity to acquaint themselves with the report of Mr. Justice McTaggart. I think, Mr. Speaker, that if the members have attended carefully to what His Honour Judge McTaggart said in his report as special mediator, the purpose of this legislation and its need at this time is clearly evidenced.

I would like to refer specifically to the words of the judge on page 6 of his report. In his recommendations he says:

"In my view, there is no doubt that the hospital industry is an essential industry. Normal collective bargaining procedures should apply whenever possible. The Labour Code of British Columbia provides a cooling-off period in situations where the public welfare must override the rights of the parties to the dispute. Circumstances may, however, arise which create problems beyond those contemplated by the Legislature." And that was certainly the case here. "In my opinion, special circumstances exist in the present dispute."

When one considers the extent to which the government over the years has committed itself to responsibility for hospital services in this province, and in particular the extent to which this government and previous governments have devoted themselves to the problems of resolving the difficulties which from time to time arise between the hospital employers and their employees, I think it is worthwhile to note some of the recent history applicable to this particular dispute. I cast no blame on any member of this House, or any member of any former government, for the actions which were taken, because they were taken in good faith and in the discharge of responsibilities which rest upon government under our laws.

But it is noteworthy that back in August of 1973 the then Minister of Health (Mr. Cocke), after consultation with the union, the particular union which is involved in this legislation, agreed to the establishment of an administrative committee to concern itself with the planning and guidance of a programme of job evaluation — August, 1973.

Since that time successive actions have been taken by government and by that committee dealing with this particular problem of job evaluation, together with a number of other matters which have from time to time arisen in dispute between these parties. I must say that at that time the Health Labour Relations Association did not exist, but arising out of all of the actions of government, and appointees of government, the Health Labour Relations Association, one of the parties in the current dispute, did come into existence.

It is, I think, noteworthy, and a matter which government will have to take under very careful consideration, that one of the principal causes for the difference, which this bill will correct, was that same problem of job evaluation. It was an appropriate matter for the parties to concern themselves with during their negotiations, and negotiations did go on for many, many months.

Negotiations commenced between these parties last fall. They culminated in the appointment by the Minister of Labour — the Hon. W.S. King, as he then was — of Mr. Blair as industrial inquiry commissioner on December 9, 1975.

Mr. Blair addressed himself to the issues then remaining unresolved. And I should say to the House, Mr. Speaker, that in the course of negotiations there had been several issues resolved by agreement, but those remaining unresolved were placed before Mr. Blair for consideration. Mr. Blair conducted hearings on 36 separate days and finally, on April 5, produced his report.

That report made certain recommendations, and

[ Page 2487 ]

while there was reluctant acceptance by the union and a rejection by the employers' association, there was no real criticism of Mr. Blair's report. There was, however, a very serious difference of opinion as to the application of restraint guidelines imposed by the national government and not then affecting anything in the public sector in British Columbia to this particular settlement.

The history since that time is well known to all members in this House — a strike ensued, essential-service designations were made in six lower mainland hospitals through the office of the Minister of Labour and the Department of Labour and discussions continued with the parties in an attempt to resolve the differences between them. Then the 21-day cooling off period commenced and the appointment of Judge McTaggart as a special mediator began.

I think, however, one must recognize from what Judge McTaggart said in his report that throughout it all the continuing problem of the job-evaluation study was one of the main problems in bringing about a resolution of the dispute. I think I should also quote what the judge says about the conduct of the parties in one respect, because I think it is these remarks that bring this matter home particularly to the government and to the members of this Legislature. The judge says:

"I am also concerned about the attitude and conduct of the parties. In the past they have agreed to the following clause and they have agreed to place it in any new collective agreement."

He quotes the clause:

"Whereas the right of the sick person to uninterrupted, skilful and efficient care cannot be questioned, and it is obligatory upon the hospital and its employees that efficient operation of the hospital be maintained, and to effect this it is important that harmonious relations be continued between the hospital and its employees."

That specific premise has always been in agreements between these parties, and yet the judge has to go on and say:

"In my opinion, the point has been reached where the parties must pay more than lip service to the above paragraph. They must place the public welfare above their own legitimate objectives. No one is here to speak for the sick. I regret at this point both parties do not appear to agree with m6."

I think it is for that simple reason the matter is here before us in the Legislature today: hospital service in our society is an essential service. Governments over the years in the province of British Columbia have recognized this and millions upon millions of dollars of the taxpayers' moneys, provided by this Legislature and by taxpayers at the local level as well, have been devoted to ensuring that the facilities for hospital care are available in all of the communities in our province.

Therefore it becomes incumbent upon the government also to ensure that when the parties to a dispute such as this are unable to achieve by collective agreement, or by the laws which we have in place in this province of ours, the resolution to their dispute, then this government, any government, and this Legislature is obliged to exercise that supreme authority which in our society is invested in parliaments such as this. Bill 75 does just that.

Judge McTaggart, in the course of his report, specified the terms of a collective agreement which he deemed to be appropriate for the parties. It was, in almost every case, the agreement which Mr. Blair also recommended as industrial inquiry commissioner. There were two or three significant changes: in McTaggart's recommended collective agreement he suggested that the contract be not for one year, ending December 31, 1976, but rather, a two-year contract, ending in December of 1977. He also recommended, with respect to the job-evaluation study, that it be implemented as soon as practicable. And he went on as well:

"Because of certain outstanding grievance matters which have been a sore point between the employer and employees in the various hospitals, that a special board be established for the resolution of those matters at the earliest possible moment to ensure that matters which are grievances are not allowed to erupt, to fester and create real issues which might affect the quality of service available in our hospitals."

In Bill 75 the government has taken the step of imposing the form of collective agreement recommended by Judge McTaggart upon both these parties. I assure the House that such a step is not easily taken, but in essential services disputes — those involving the public sector, as this one does — this action must, from time to time, be taken. We saw instances over the past three or four years when the former government in British Columbia had to avail themselves of this same opportunity and to discharge the obligation in a similar way. We do so with the benefit of an individual in our province who has a long history of association with the hospital industry and therefore a large degree of experience and skill in such matters.

We have also had the opportunity of having that individual report examined by a judge in this province who is recognized for his independence to such an extent that he has been selected unanimously by both employer and employee groups in the resolution of other disputes. So when we've presented Bill 75 to you, imposing upon these parties this recommended

[ Page 2488 ]

form of collective agreement, it comes with very careful consideration by persons of skill and experience.

During the time that this collective agreement has n been imposed, the Act prohibits any strike or lockout. This is to ensure that there will be full performance with the collective agreement, but I hasten to say that perhaps the section is redundant. Under our laws, the conclusion of a collective agreement makes it illegal for parties to strike or lock out. It is imposed in this way so there is absolute certainty that during the period specified in the collective agreement there will be no resumption of work stoppages for whatever reason and therefore the disruption of hospital service. Specific provision is made in that regard.

The other matter which I think I must comment upon is the subject of job evaluation. Judge McTaggart, in his recommended form of agreement, I suggested that the job-evaluation programme should be implemented as soon as practicable. As one looks back over the successive actions in job evaluation since it was first undertaken in 1973, we find that there have been other promises on the part of government to undertake such an evaluation as soon as practicable, or with similar words, without any definite assurance that it was taking place. But there certainly has been a commitment on the part of government, made by the former Minister of Health (Mr. Cocke), that such would be done. Therefore, to ensure that there can be no doubt about the good faith of government in this respect, there is a provision in the Act which provides for the establishment of a fund of $6 million in this fiscal year for the purpose of implementing the job-evaluation programme. That fund will be paid out upon the requisition of the Minister of Health (Hon. Mr. McClelland).

It is appropriate to note in this regard that there is doubt at the moment as to what the aggregate costs of the job evaluation will be. While the report is in existence and has now been made available to the parties, the assessment of the total cost will take a some time, and the practicalities of implementation will require the earnest active participation of both the employer and the union.

I trust that with this indication of fulfilment of commitment by this government the parties, as soon as this bill becomes law, and therefore as soon as the collective agreement is in force between them, will move to discharge their responsibilities in job evaluation in this element of hospital service.

I must point out as well that there is specific provision in this legislation that, once enacted, the agreement will be subject, as soon as it is practicable, to the review by the Anti-Inflation Board under theAnti-Inflation Act of Canada and the regulations made thereunder.

Mr. Speaker, you will recall that last evening this house gave third reading to Bill 16, which paves the way for the government to conclude with the national government the appropriate agreement provided under the federal legislation. Action is now being taken by the Minister of Finance (Hon. Mr. Wolfe) in that regard, and it is to be hoped that within the next few days British Columbia will, by agreement with the national government, place its public sector in a position where collective agreements entered into since last Thanksgiving Day will be subject to the review of the Anti-Inflation Board.

MR. A.B. MACDONALD (Vancouver East): How far retroactive?

HON. MR. WILLIAMS: I said last Thanksgiving day.

Interjection.

HON. MR. WILLIAMS: Well, that's what the law provides, Mr. Member.

Interjections.

HON. MR. WILLIAMS: The terms of the agreement, as I say, are being settled by the Minister of Finance of British Columbia with the Minister of Finance of Canada (Hon. Mr. Macdonald), and I'm sure that agreement will be available to review by the members as soon as it has been concluded.

There is specific provision in the legislation dealing with this matter, because arising out of decisions which have been made by the Anti-Inflation Board on review of agreements from British Columbia, there have been instances when the so-called rollback has required careful examination by the parties to the agreement. Therefore specific provision has been made on this matter to ensure that any variation in the collective agreement which might arise from the actions of the Anti-Inflation Board will be incorporated in the collective agreement without any hiatus. To ensure that this is the case, if the parties themselves have difficulty in applying any variation of the Anti-Inflation Board to this collective agreement, the special mediator will continue to be available to the parties to assist in those matters. If there is a dispute, the special mediator's decision in his regard will be final and binding.

There is great concern about the cost of compensation increases such as are incorporated in his agreement, and I wish the members to know that the government is seriously concerned about the growing cost of health-care services in all of our communities. Nonetheless, at this moment the only restraint, aside from the restraint by actions of the

[ Page 2489 ]

parties themselves in respect of compensation matters, is that which is exercisable under the Anti-Inflation Act of Canada.

I would like to think that in our essential services, in our public sector, on the part of government and its employees, appropriate restraints could be practised at all times, recognizing that the consequences of unrestrained demands and a willingness to accede to those demands have the most serious consequences, not only upon government but upon our whole community and the economy of this province.

The ability of this province to pay for the services of government which are demanded by our citizens depends in no small measure to the extent to which restraints are exercised in public-sector settlements. In this case, this agreement goes to the Anti-Inflation Board.

If, however, such restraints as presently are in existence should appear to be inappropriate, then I suppose the members of this House will need to consider, at some future time, other actions which we may have available to us in the province of British Columbia to achieve the goals of restraint which we deem to be appropriate for this province.

I trust that this method of resolving public-sector disputes in essential services does not become the standard practice. As Minister of Labour, I find with increasing regret that there is a growing tendency to expect that government somehow or other will solve all the problems. If employers and employees, their organizations and their unions, truly believe that collective bargaining is the way, then I think they must take into very careful account some of the actions which they practise during the course of negotiations.

Bargaining is bargaining — a willingness to shift and move to achieve a settlement. Rigidity is not collective bargaining, and in the public sector and essential services those parties who are not involved directly but who are the innocent victims of the failure to agree are entitled to look to government and eventually to this assembly for their relief.

Government is available to act and government will act when the need is there. But the decision as to whether government must act rests upon the shoulders of the parties who are directly involved in the process of bargaining. I think that is why we are dealing with Bill 75 today — some lack of recognition of the value of the collective bargaining process and a tendency to look to government to show the way out.

Mr. Speaker, I have pleasure in moving second reading of Bill 75.

MR. G.R. LEA (Prince Rupert): Mr. Speaker, the New Democratic Party supports this legislation. We also support this legislation with regret but possibly from a different viewpoint than that of government. As the minister pointed out, I believe twice when speaking, there is a growing tendency within the community between negotiating parties to rely in the final analysis on government to solve disputes that they should be solving themselves through negotiation.

There may be some tendency on the part of some unions and some management groups to do just that, but I don't feel that it's possibly asking too much for government to solve problems that they themselves have created through inaction. I'm afraid that that is somewhat the case in this particular dispute.

I think we should go back to look at the Blair report. The minister has said, Mr. Speaker, that the union — or the employees — accepted the Blair report with some reluctance. Whether or not there was reluctance or not, I don't know. Possibly there was, but at least they accepted the report.

The management group may have felt that the Blair report was a fair and equitable report and the recommendations they may have felt should have been followed. But there was no way that the management group could accept any report for the simple fact that the funds come from provincial government, and the government had made it clear to the management group that only 8.5 per cent would be allotted, and so the HLRA had no choice but to turn down the Blair report.

When we look back over some of the history of this dispute, especially the government's involvement, we can see that what has happened here is that the government said to the management group: "You're only going to get, no matter what the final negotiated terms are between yourself and the employee, 8.5 per cent," and then expected that there could be a negotiated agreement. So what we have in this case is the management group having by necessity to turn down the Blair report, no matter what they thought of that report — consequently a strike in the province of British Columbia within the hospital industry.

A strike in the hospital industry, Mr. Speaker, is something that no one wants — the public, the employees of those hospitals or management of those hospitals. No one wants a strike and we feel that a strike could have been avoided, especially with the legislative machinery, both federal and provincial, that is available to government.

Government has said that even this agreement that is being imposed will be reviewable by the federal AIB and by certain sections of Bill 16, the anti-inflation Act, through this Legislature. So it seems redundant to do that once government has imposed a collective agreement. So it is with regret, real regret, that we support this legislation, although at the same time it should be pointed out that the

[ Page 2490 ]

action government is taking at this point is action that we approve of.

Mr. McTaggart's report says that the point had come where an impasse was there and neither side was moving, neither union nor management, and at that point government has no choice.

So we regret the need for the legislation in this case, but even more we regret the inaction of government to ward off the strike itself by making money available, through government, to meet the negotiated terms that could have been arrived at through negotiation between the management/employee group. It would still have been up for review, both through federal legislation and through provincial legislation. So there was no harm in allowing a freely negotiated contract to be negotiated or allowing the management group to accept the Blair report, because it was all going to be reviewed at a later date anyway under federal and provincial legislation.

Mr. Speaker, there's only one group of people which is going to really suffer because of the inaction of government. In the hospital industry I think everyone would agree, because of the sensitive nature of looking after sick people, that there probably does have to be more harmony between the employees and management than probably in other form of industry within any province or within any jurisdiction. Any labour dispute, no matter who's at fault or who isn't at fault, leaves behind it some feeling of bitterness.Bitterness should not be experienced in labour relations within the hospital industry if it can at all be avoided.

I believe there is going to be some bitterness left behind as a residue from this dispute — unavoidably. So, Mr. Speaker, we support the action of government at this point in coming to this Legislature to take the action it's taking in Bill 75, but we truly regret that the government did not follow a better course of action leading up to the necessity of bringing in this legislation.

MR. G.F. GIBSON (North Vancouver-Capilano): Mr. Speaker, I would first of all wish to congratulate the minister on his opening remarks, first of all in terms of the substance on this particular bill, which he canvassed well, but beyond that, his philosophical remarks which related to the whole question of settlements in the public sector and how they're to be arrived at and the impact on the economy. If I heard the minister rightly we might expect some further general initiatives along that line later on. We will await them with interest.

He spoke also of the philosophy of hoping that the Legislature should not as a matter of routine have to enter into the settlement of disputes. I think that everyone in this chamber would share that hope and go on to say that to do that requires improvement in the underlying labour/management relation system we've developed in this province.

I support this bill in principle, Mr. Speaker. It's a very important bill, first of all because the principle of legislating the end to a work stoppage or dispute is always important and always to be approached reluctantly, and, secondly, purely in financial terms. We're talking about a minimum of $6 million in a job evaluation account, an amount which I suspect will prove to be insufficient in the end, and we're also talking about the imposition of a particular settlement, the variation of each percentage point of which costs about $2 million to the public purse. So we're talking about a bill which in both moral and financial terms is important.

This dispute, I suspect, has had a difficult history for the Minister of Labour, because it arises out of some basically incorrect relationships that perhaps needed some work stoppage in order to sort them out. The parameters were wrong from the beginning. HEU local 180 was really bargaining with the government for the implementation of the Blair report, through the intermediary of HLR. But, as the hon. member for Prince Rupert (Mr. Lea) just suggested, HLR has no money of its own; it has only government's money to dispose of. So the true bargaining party, as far as HEU was concerned, was he government. The HLR, on the other hand, was also really, in the end, bargaining with the government. They were bargaining with the government for higher funding in terms of operational costs, they were bargaining with the government for job evaluation funding, and they were also, in my opinion, bargaining with the government in an implicit way in order to get some new essential services legislation passed in this province.

The outcome will, in all probability, be that all parties will be reasonably satisfied, because the legislation imposes the terms of the Blair report, subject to the AIB, and on the other hand gives HLR its job evaluation funding. It may or may not give them higher operational funding, but in my view it simply has to. I want to question the minister about that.

The underlying situation might have been avoided had the genuine parties to the dispute been talking face to face. I don't know. That's a matter of speculation, and it's also a matter of speculation whether, in the long run, the work stoppage — which, thank God, gave rise to no specifically serious incident as far as we know — may in the end have brought some good results.

I hope that either the Minister of Labour or the Minister of Health might tell us at some time during his debate whether or not funds will be available to the hospitals of this province to achieve the settlements which this Legislature is imposing.

The special mediator mentions in page 2 of his

[ Page 2491 ]

report, "The employer has been advised by the Minister of Health that any budget increase for the year 1976 will be limited to 8.5 per cent." This is a figure which has been mentioned often. The Minister of Health (Hon. Mr. McClelland) during debate on his estimates indicated that it didn't quite reflect the realities of the world, but on the other hand I have here a clipping from The Daily Colonist of this morning, saying of the minister: "He indicated at that time that he wasn't ready to guarantee his department would be willing to foot the bill for a recommended settlement."

Now that was, I gather, early on last evening, and I would assume that the fact that the bill was finally introduced strongly implies that the government will make the funds available to achieve the payment of those salaries, but it would be good to hear that specifically from the Minister of Health or the Minister of Labour (Hon. Mr. Williams).

The stand of HLR during the currency of the dispute raises some questions that were raised as well by the minister. They took large ads in the newspaper talking about hospital costs in this province, the rapid escalation, and inferentially raising the question of how in the public sector you allocate resources. In the private sector we have a market mechanism. In the public sector is it to be achieved entirely through the use of political pressure, bargaining power of one kind or another, or is there some more rational way we can arrive at the resolution of these disputes?

The minister touched on these questions. I'm glad he's thinking about them. I know he is. This raises as well the question of who is really to manage the hospitals, because to the extent that we admit it — I think we have to — the Department of Health is strictly responsible for their funding, almost on a 100 per cent basis.

I wonder to what extent a local hospital authority has any real autonomy. I say that not wishing to remove any such autonomy but in hoping in some way to strengthen it, because I think that local management is an important thing to the extent we can arrange it. Whether in this debate or at some later time, I think it's important that the Minister of Health give us his thoughts on this question.

The settlement which is imposed by this bill as outlined in appendix 1 is a very complicated one. Something which was not clear to me from the remarks of the Minister of Labour is to what extent appendix 1 is — with the exception of some of the controversial questions such as job evaluation and wage settlement — essentially a continuation of previous contract language, or else contract language which had essentially been agreed to by the parties during the negotiations. I would assume that this is the case but would be grateful for that reassurance.

The amendments brought in by the special mediator in the contract I think are generally good. The two-year time period with a reopener and a COLA clause at the end of the first year, a job-evaluation clause and a special grievance committee — all of these I believe are productive advances.

I think we have to remember that we are in a sense passing an uncertain bill because of the Anti-Inflation Board reference which the bill provides. The AIB could come down either way. HEU is confident that there is ample precedent to support the so-called Blair award by the AIB. HLR disagrees. The special mediator was unable to come to a conclusion either way. But one thing is certain. This Legislature must rule, and both sides must agree, that whatever the AIB says they will abide by.

It is conceivable that in the end some good things may come out of all of this. The situation has been one of sufficient drama that has heightened an appreciation of some of the anomalies in the situation. It has, in my mind, revealed an inadequacy or an incompleteness in our existing law relating to essential services because, while I have no question that the LRB was following the Labour Code in designating the services that they named essential, it is at least my opinion, and I think the general opinion of the public, that insufficient employee support in the hospitals was designated to maintain what most people thought to be genuinely essential services. While, by the report of the Minister of Health, medical standards within hospitals were not prejudiced, there is no question that many persons out in the community who otherwise would, have been in hospital for good and sufficient reason were excluded from that by the operation of the strike.

One of the other interesting things that we could see during the currency of the strike was the general respect of the public, as far as I could see, for the union position. There was not any wish to say that they were absolutely wrong because they had walked out of an important health service, no particular inclination to take a simplistic position, but rather a sympathy for the problem. I think that bodes well for the future of labour relations in this province.

There is unquestionably an increased public concern with labour-management relations and there is going to be a lot of public sympathy required in improving the situation, because it must, in the end, be improved by cooperation and not by confrontation. A lack of confrontation in the short term may be necessary to lead to cooperation in the long term, may take a good deal of public sympathy to be sustained. This sort of thing must be sustained because even legislated solutions, which are currently our last resort in these circumstances, must have moral authority and public support, and the support of both of the parties to the dispute.

With those remarks, Mr. Speaker, I believe that the government has produced a necessary bill, a bill that I

[ Page 2492 ]

can support. Once again, I congratulate the minister on the manner in which he brought it in.

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, I am impressed as the Liberal leader (Mr. Gibson) was by the minister's introduction of this bill which I would certainly support. There are one or two general points, I think, that should be made based on the fact that we have to be debating this bill today under the circumstances which the minister outlined.

In the first place, it contradicts some of the statements that were made during the strike that somehow hospitals can muddle through and people will not lose their lives, simply because not all hospital employees are directly involved in treating sick people but are, in fact, providing support services of one kind or another, such as cleaning facilities and supply of other similar services. One of the elements in the various discussions that went on during the strike, and some of the answers which were given in question, period during the strike, left me personally very uneasy that society was losing sight of the fact that because persons were not dying in hospitals because of the strike, somehow or other there was little or no suffering involved by sick people. I think the minister has recognized that of the three options mentioned by Judge McTaggart in his report, the No. 1 option is totally unacceptable.

In introducing the bill the minister quoted from the Blair report. I think it would be interesting to place on the record, from page 7 of the report, Judge McTaggart's statement that there are three options in light of his failure to bring about an agreement between the parties. He says:

"The first option is to do nothing and leave the parties to proceed as they wish on the expiration of the 21-day cooling-off period. The union has made it clear it will resume the strike; this option is clearly out of the question."

I think the minister, by bringing in this bill, clearly agrees with the special mediator. This, in action and fact, confirms and I hope places on the record once and for all that the strike weapon in the field of essential services is archaic and wasteful of a great deal of time of many people in all the convoluted manoeuvrings of negotiations, such as we have seen, when the first prerequisite, as the minister himself has said, is providing proper service to the sick. Every other consideration of employer, employee and taxpayer has to come secondary to that overriding primary concern.

I very much appreciate the minister's quoting that very significant section from Judge McTaggart's report. I won't repeat it, but it, in effect, states that both parties had previously guaranteed in their agreement that their primary responsibility was to ensure the continuation of service to the sick. The judge in his report says that the parties have reached he point where they are merely paying lip-service to that prior commitment in writing in a previous agreement.

I would like to align myself with the minister's other comment that in this debate I am not picking sides and I am not seeking to lay blame on either of the two parties involved in this dispute. The first essential point we must recognize is that strikes in such essential services in a supposedly enlightened era of 1976 are completely unacceptable.

On that basis, it emphasizes a point that has already been made by this government not only in relation to the hospital strike, but in relation to the situation on the B.C. Railway, that there is need for ongoing legislation which will, in the fairest possible way, deal with this kind of problem before it ever gets to the stage that has been reached at this particular time.

This fragmented, crisis-by-crisis approach to labour disputes in essential services just cannot continue. We hear a great deal nowadays about the gutlessness of politicians and the fact that they're hesitant or afraid to deal with this kind of issue, and to show leadership. While I welcome this bill as one of these ad hoc, crisis bills to deal with an immediate situation, I can give the government notice that if they bring in a much more significant type of legislation which recognizes these lessons of the recent years and incorporates in permanent legislation some of the safeguards — and the safeguards will work both ways; safeguard the public and also safeguard the rights of employers and employees in essential services — then they will certainly receive my strong support on that kind of legislation.

One of the fundamental reasons that any group is very nervous about either giving up the right to strike or losing the right to strike, is the feeling that it will fall behind comparable forms of employment in elation to wage benefits and fringe benefits. I would just say in passing that I hope the government, in the kind of legislation I anticipate, will incorporate some measure of safeguard that will give essential-service employees the assurance that they will not, in fact, fall behind simply because they don't have what appears to be the ultimate weapon, namely the right to strike.

The McTaggart report, I think, is excellent in various ways, not the least of which is its brevity and clarity. The McTaggart report spells out the reason for it having to be issued in the first place and I think, in a very clear and brief manner, sums up the issues on which Judge McTaggart had to make a decision.

Mr. Speaker, I think there are many lessons to be learned from this very serious dispute, one of which is the very legitimate position by the union, as I see it, that they adhered to good faith and all the techniques of negotiation available to them and finally agreed to

[ Page 2493 ]

an industrial inquiry commissioner, namely Mr. Blair, and the reason they persisted in striking was that they felt, in good faith, they were entitled, even with reluctance, to accept such a commissioner's report and assume that the other side would be equally willing to accept such a report.

The problem, as we have mentioned in other debates in this House, is that these reports are not binding. We discussed the other night in this House briefly the problems in Nanaimo relating to the school board and its dispute with employees, and I think we should all try to learn from these experiences and encourage this government to look at the possibility of ongoing legislation being amended to make this kind of commissioner's report binding.

The minister made many general comments about the whole problem of serious public disputes, and, either in this House or in public statements, it is quite clear that this government is moving towards some form of binding arbitration in various areas. Without intruding on another bill in the House, there is an example that that is a concept the government wishes to implement. I would say that if the government is thinking that far ahead toward forms of binding arbitration, it would make a great deal of sense to have industrial inquiry commissioner findings made binding by an appropriate amendment to the Labour Code.

As I mentioned a moment ago, even in the very best of good faith by both sides to a dispute there is an immense amount of time and money and effort spent trying to reach an agreement, and to anyone who has discussed this with both sides in this dispute — and I appreciate the minister's personal effort in this dispute to keep me informed — it's clear that we finished up with the Blair report, or most of the Blair report, being imposed rather than accepted. That is why I feel that if we're not to learn something from these disputes then, indeed, we would all feel rather pessimistic about the future when, no doubt, this similar kind of situation occurs.

But on trying to look at the, employers' side of this problem, Mr. Speaker, I also completely agree with the concern and hesitancy which they showed about accepting the Blair report.

The valid point has been stressed that the employers, the hospital trustees, have no money of their own — they are provided, in a very large measure, with money from the government only — so this makes it very difficult for the employer in hospital disputes to know exactly how or when they might have the funding available to even listen to the kind of wage increase and fringe benefits which have been requested by the other side. Any employer in his right mind would surely not agree to accept something which was as nebulous as the job-evaluation programme and its undecided cost.

The minister, in his introductory remarks — and I think I have it correctly; I wrote down his statement — said that assessment of the costs of the job-evaluation programme will take some time. I think it's fair in trying to learn lessons from this strike, that the employers, in my view, are absolutely justified in being very apprehensive at accepting the Blair report when the central issue, which could not be measured in terms of dollars, was the job-evaluation programme and the fact that they really did not know whether more money might be forthcoming from the government. I would like to make this point abundantly clear.

Again, I am not laying blame. I am just trying to think how I would have responded had I been negotiating for the employers, because the hospitals received a letter from Mr. J.G. Glenwright, the Associate Deputy Minister of Hospital Programmes, dated May 13, 1976, which stated, as has been mentioned in the House already, that a general increase of 8.5 per cent can be provided in the 1976-77 budget of hospitals. But what has not yet been stated in this debate, or on previous occasions in the House, was a very significant paragraph in that letter to the hospitals. On the second page of the letter to the hospitals it states as follows: "Your attention is drawn to the fact that funds provided to your hospital on the above basis must cover any increased costs that will be incurred by your hospital as a result of 1976 collective bargaining agreements, including any additional costs that may result from the job-evaluation study."

Now nothing could be more shattering, I would think, to the employers than to be trying to consider the Blair report, which basically was 8 per cent plus COLA, plus fringe benefits and including the job-evaluation programme, the cost of which has very much in debate.

Interjection.

MR. WALLACE: The Minister of Health (Hon. Mr. McClelland) is shaking his head, and I am sorry about that because if he had been listening he would have just heard the paragraph from Mr. Glenwright's letter. I'll read it again.

Interjection.

MR. WALLACE: Mr. Speaker, I just wish the Minister of Health would open his ears instead of his mouth.

I'll read the paragraph again: "Your attention is drawn to the fact that funds provided to your hospital on the above basis must cover any increased costs that will be incurred by your hospital as a result of 1976 collective bargaining agreements, including any additional costs that may result from the job-evaluation study." Now what could be clearer

[ Page 2494 ]

than that?

Now I was not meaning to become partisan or angry in this debate, Mr. Speaker, because it is supposed to cross party lines. But if there's anything clearer in the English language than the fact that the employers were told that anything they accepted at the bargaining table, the 8.5 per cent promised promised by the hospital, would have to include the increased costs of the job-evaluation study.... That's been the whole obstacle to this particular dispute, as the minister well knows.

MR. G.V. LAUK (Vancouver Centre): Complete irresponsibility.

MR. WALLACE: I am not criticizing or blaming anybody at this point in time. I am just saying that because of the stated facts and figures there was very little hope that the parties themselves, or with the help of special mediator, could realistically and intelligently work out a settlement when this letter had gone to the hospitals on May 13 stating that no increase in budgets above 8.5 per cent would be permitted and that the increase would have to include the cost of the job-evaluation programme.

[Mr. Schroeder in the chair.]

So again trying to stress a theme that we must learn from the past, and without quoting the famous historian or somebody who said that those who fail to learn from history are doomed to relive it — a very pithy little bit of philosophy in the middle of an angry speech, Mr. Attorney-General....

But in an attempt to learn from our experience, I do feel that government will have to wonder how valid or realistic it is for hospital trustees or their representatives to sit around a negotiating table and give any serious consideration to the wage demands of employees when there is this precondition set by the source of funding, telling the employers that before they go any further with any kind of negotiation, they will be limited to X per cent increase in available funds.

During the strike, Mr. Speaker, I was able to meet with Mr. Geron who's the manager of the union — I'm not sure that's his precise title, manager-secretary — who stated that this was one very essential obstructive reason to fruitful negotiations. The union knows very well that in the general context of negotiations they are not in this instance really negotiating with the people who matter, because the employer sitting across the other side of the table is hamstrung right off the bat before they get into negotiations by a ceiling set upon the amount of money that will be available.

Now if the Minister of Health (Hon. Mr. McClelland) means that this statement in the letter to the hospitals is flexible, it certainly doesn't read that way in the paragraph. Again let me stress that I'm not trying to nail Mr. Glenwright or the minister, or anybody else, but I'm saying that if I were an employer and a hospital trustee, having read this letter and then sitting down at a table to negotiate, and the request from the other side of the table far exceeds the amount which the government is committed to making available.... What kind of realistic negotiations can you have from that point on particularly when one of the fringe benefits that is being debated is a job-evaluation study in which the employers.... The minister today has acknowledged that that is very much an unknown quantity which will take time to measure.

Now we are frequently and quite correctly being asked by political leaders at all levels to understand the need for financial restraint and to try and exercise that restraint. It would seem to me that all the employers were trying to do in this case was heed those national, provincial, municipal and regional warnings from every politician in Canada. I think it's very obvious that this dispute was unlikely ever to be settled by the two parties in negotiations, even with a special mediator for some of these basic preconditions, which made bargaining almost certain to fail, no matter how much good faith was brought to the table.

MR. LAUK: Who set these preconditions? Why are you beating around the bush?

MR. WALLACE: Well, somebody — and the member for Vancouver Centre says: "Who set these preconditions?" One of the parties who set the preconditions was the former Minister of Health (Mr. Cocke) who entered into an agreement with the employees — since you asked, Mr. Member.

MR. LAUK: It's not my day!

MR. WALLACE: He was the previous Minister of Health.

MR. LAUK: All right! All right! Next point.

MR. WALLACE: And I didn't make that response either to criticize or to blame the former Minister of Health. He did so in good faith on August 3, 1972, when he agreed to the setting up of an administrative committee as provided in the agreement under article 12, entitled "Job Evaluation." If we can just interject again a general note dealing with the whole field of labour-management problems, it is very much this question of job evaluation and individuals being paid a certain rate of pay which they feel is inadequate in relation to other persons in other occupations with perhaps less skill, or less training, or less experience.

[ Page 2495 ]

We needn't kid ourselves that this job-evaluation aspect is just a problem in the hospital field. It is the kind of issue that's been discussed in this House during the estimates of the Minister of Labour for the last several years that I've been here. One of the fundamental reasons for unrest in some forms of employment is the fact that the employee feels that he or she is getting a great deal less for their training and effort and responsibility than some other group less well trained, with less experience and perhaps better hours of work.

So we would again be failing to learn from the past if we didn't recognize that the whole issue of job evaluation is extremely important in this debate. Because of that, I'm very glad that the discussions and Judge McTaggart's report have emphasized how important it will be, if there is to be any long-term peace in the hospital field, regarding labour-management problems, that the job-evaluation part of the agreement is taken very seriously and dealt with as soon as possible.

The difficulty in deciding the cost of the job evaluation has already been mentioned, and on that point, I wonder if the minister in winding up second reading would tell us: was the $6 million figure just pulled out of a hat, or, despite all the difficulties in assessing the cost, how did the minister and his advisers come up with the $6 million figure? We've heard about the $6 million-dollar-man, but this is a $6 million job evaluation we're talking about.

I'm also interested in article 12(7) of the agreement which says that the job-evaluation programme will be shared equally by the employer and the union. I wonder if the minister could confirm that that is the course that will be taken and whether that is a new addition, or was that part of the agreement that was reached by the former Minister of Health (Mr. Cocke) when the administrative committee was set up?

Mr. Speaker, for the benefit of the minister, it's on page 45 of appendix 1 and it's under article 12(7) .

Mr. Speaker, I understand that the Attorney General would like to make a statement so I would ask leave of the House that I might permit him to do that and I can resume my place in debate later.

MR. CHAIRMAN: Shall leave be granted?

Leave granted.

INVESTIGATION OF KITIMAT
LAW ENFORCEMENT SITUATION

HON. G.B. GARDOM (Attorney-General): Recent events in Kitimat, Mr. Speaker, have caused concern in the community with respect to law enforcement, and as a result of these concerns, I have asked officials of my department to proceed to Kitimat this afternoon and to furnish me with full particulars of the matters as they now exist there.

We're interested, as I'm sure are all members of the House, in the peace, order and security of all of our citizens, and hence this step is being taken. The concerns in question have been expressed to the government by members of local government and by the MLA for the area (Mr. Shelford), and we wish a first-hand report.

MR. MACDONALD: Well, Mr. Speaker, I appreciate the Attorney-General taking the House into his confidence, and I appreciate his not taking precipitate action in what is a dangerous situation.

MR. GIBSON: Mr. Speaker, as the hon. member for Vancouver East says, the situation is a very sensitive one, and from what the Attorney-General has just said, and from other talks, he has handled it in a very sensitive way. I wish him well on it.

MR. WALLACE: Well, very briefly, in response to the Attorney-General's statement, I just want to say that despite the sensitivity that the other two opposition members have referred to, what we're really concerned about is obeying the law of this province.

It's a little bit like the essential services in the hospitals. The overriding concern is the public good and the preservation of law and order, and the rights and advantages or otherwise within labour management negotiations come very much secondary to that.

If I may continue, Mr. Speaker....

DEPUTY SPEAKER: Second reading of Bill 75. The hon. member for Oak Bay.

MR. WALLACE: I would just appreciate some information from the minister about why $6 million was considered to be an appropriate preliminary amount of money for job evaluation and whether this was determined in consultation with the hospital employers. I have referred to article 12(7) which states that the job-evaluation programme would be shared equally by the employer and the unions, and that leads to the third question: does the minister's allocation of $6 million for the job evaluation mean that the initial costs are to be $12 million and the other $6 million will be provided by the union, according to the subsection I have quoted?

Finally, Mr. Speaker, the minister has referred in his comments to a tendency for the public to look to governments to solve their problems. It seems that in areas like this where essential services are concerned they have every right to look to government to solve their problems. Inasmuch as where the desirable procedure of collective bargaining repetitively fails to

[ Page 2496 ]

solve the problem and we deal with it finally on this kind of emergency crisis basis, it's not surprising to me that citizens generally in this province look upon government very much as the last resort to solve their problems. And thank God they're doing it, otherwise we would be back into a hospital strike the day after tomorrow.

So while the minister may wish and sincerely believe that there are other ways or better ways to solve these disputes other than by the method we are now having to employ, with the greatest of respect, I feel that the citizens in British Columbia are very often left with little other choice. I'm sure all the people who are going broke along the B.C. Railway line feel that the citizens in British Columbia are very often left with little other choice. I'm sure all the people who are going broke along the B.C. Railway line feel very much the same way.

So the basic premise we all seem to be agreed upon is that at times when the third party concerned, being the public, are being severely penalized, or perhaps having their life or health endangered, there's absolutely no other solution to the problem other than to have the government invoke legislation which overrides existing legislation in the Labour Code.

So, Mr. Speaker, if I could try to sum up quickly: the bill is necessary; I support it. I think that the work of Judge McTaggart is to be congratulated for its clarity and brevity. But even more important than solving the immediate problem, I hope that we'll learn some lessons from the way in which these problems have developed this time around and that we can confidently look to the government for more permanent, ongoing legislation which will include safeguards to all parties — not just the third party but the employers, the employees and the public.

HON. R.H. McCLELLAND (Minister of Health): Mr. Speaker, I'll be very brief in supporting this bill. I do want to respond, though, to a couple of comments that were made, and which relate directly to the Department of Health, by all the three members who've spoken in this debate.

I find it difficult to understand why an essentially labour party would look to the provincial government to step in and abrogate the rights of two sides in a labour dispute to get together and solve their own differences, which is essentially what the NDP has asked us to do.

The same thing is true, to a large degree, in what the member for Oak Bay has said and what the Liberal leader has said as well. All of them have asked, or have suggested, that the Department of Health, through my office, should have given an open-ended guarantee in a labour dispute to two parties legally constituted.

The member for Oak Bay talked about the rule of law. The labour law in this province at the present time provides for the hospitals to bargain with the unions. We attempted to allow that to happen just as long as possible. Because it didn't happen is the reason we're standing in this House today debating a bill.

As a responsible government there is no way I could recommend that we guarantee the costs, particularly of the job-evaluation report, since estimates for the cost of that report varied from $6 million to $20 million. It would have been completely irresponsible for me to say: "Here, here are the keys to the vault. Don't bother bargaining; the money is there, so settle in any way you think is right." It just couldn't possibly be done, Mr. Speaker.

Now if the Liberal leader's suggestions were followed, in which he says that the real parties to this dispute should have been face to face in bargaining — and I assume he's talking about the union and the Department of Health — then, okay, if that's what the Liberal leader wants, if that's what the member for Oak Bay wants, and if that's what the NDP wants, then stand up and say eliminate hospital boards, and we shall run the hospitals from Victoria with no local input. We can do that. I don't want to do it....

MR. WALLACE: It doesn't have to be one or the other, Bob.

HON. MR. McCLELLAND: Well, yes it does live to be one or the other. The financial responsibility is there.

The Liberal member particulary said in this House today to let the parties bargain face to face. He also said that....

Interjection.

HON. MR. McCLELLAND: Well, you said that, in effect. And, Mr. Speaker, the NDP has also said that in effect by saying that the provincial government should have said that we'll accept any settlement made with the job evaluation and with the collective bargaining process. That's easy. Anybody can do that and the door's open. That's not responsible government, though, Mr. Speaker, and there was no possible way that we could have done that at that time.

Yes, we said to two hospitals that there was an 8.5 per cent limit on their increase in expenditures this year, because that's what was included in the budget. We had already given the hospitals 8.5 per cent in terms of their annualization in COLA clauses and job-evaluation payments, of which we've already paid, from the Department of Health, over $3 million — which is, in effect, an acceptance of the job-evaluation report. So really what the hospitals

[ Page 2497 ]

have been given in terms of increased cash — and I said this before; I don't want to belabour it — was a 17 per cent increase, which again is a pretty hefty increase in one year.

So we're saying, let's stick within some kind of recognized budget for the hospitals. Just look what's happening in other parts of Canada and you'll see that it's a dilemma we're not facing by ourselves. Saskatchewan is forcing bed closing, staff layoffs, and health-care agencies have been instructed to stay within their announced budgets. That's exactly what we've said: stay within your budget.

Saskatchewan is also saying that funding is being cut for capital grants to hospitals, equipment grants to hospitals, staffing of the Saskatchewan dental plan, research of the Saskatchewan cancer commission, activities of the alcohol commission. Non-hospital x-ray facilities are being cut and funding for the regional hospital councils is being stopped in Saskatchewan.

That's like saying that no more will the greater Vancouver Regional Hospital District get any more funding from government. I'm only pointing out that this is a problem that we face and we have to somehow say to the hospitals: "Stay within your budget."

Unfortunately the HLRA, who were the bargaining agents for the hospitals long before that May memorandum went out to the hospitals, said: "We will not accept the Blair Report. We will accept 8 per cent and no more." There was no bargaining from that position.

We recognized that there was no bargaining on either side. That's why the government finally had to step in. I don't think the Labour minister (Hon. Mr. Williams) could have done anything else, Mr. Speaker; nor could the Department of Health as a responsible representative of government have done anything more than it did.

MR. LAUK: You could have done this 40 days ago.

HON. MR. McCLELLAND: Mr. Speaker, that party over there wrote the Labour Code under which we are operating now. We attempted to operate under that Labour Code — under the rule of law in this province.

MR. LAUK: Nothing's changed.

HON. MR. McCLELLAND: You're right. Nothing has changed; we're still operating under the rule of law, Mr. Speaker.

MR. LAUK: No, nothing's changed in the dispute, and you know it. You dragged it out.

HON. MR. McCLELLAND: Unfortunately we found that neither side was able to come to the kind of conclusion that was necessary to settle the dispute in their own way between themselves. If that member or the Liberal member (Mr. Gibson) or any other member in this House wants to stand up and say — "Eliminate hospital boards. Let Victoria run the hospitals without any local input. Let Victoria bargain directly with all of the hospital unions." — then let them stand up and accept that responsibility, Mr. Speaker. It is one that I reject.

Now that we are in this position, we have accepted the responsibility of government to legislate an end to a strike which in all conscience we couldn't let happen again. Everybody in this House agrees that a further strike in the hospital services would have been reprehensible.

I have gone to government and I have asked government if it will, first of all, guarantee the cost of a wage settlement, whatever that settlement might be as approved by the Anti-Inflation Board above 8.5 per cent, which is the approved budget that we have now. Government has agreed, so we will guarantee any increase approved by the AIB above 8.5 per cent. As far as the $6 million goes for the job evaluation report that the member for Oak Bay (Mr. Wallace) raised, I am sure that the member has to realize that we are talking about 16,000 employees who will have to be readjusted in one way or another. It could be very expensive, depending on the manner in which those employees are readjusted and slotted. We don't know how much it is going to cost. The $6 million was sort of picked out of the air. We've paid $3 million already — better than $3 million — in terms of the anti-discrimination agreement to bring the female employees up to the level of the male employees. That has already been paid; that's a large part of the job evaluation report, Mr. Speaker.

AN HON. MEMBER: Aye!

HON. MR. McCLELLAND: The silly little man.

Mr. Speaker, the upper estimate by the union is something like $20 million. We don't think it will cost anywhere near that to implement. We don't think we can get by for $5 million; we've said $6 million in this fiscal year. It is an indication in good faith by the government that we will implement the job evaluation report as quickly as we possibly can. Government will pick up the cost of that implementation.

MR. WALLACE: All of it?

HON. MR. McCLELLAND: All of it.

MS. R. BROWN (Vancouver-Burrard): Mr. Speaker, the minister really has answered my

[ Page 2498 ]

question before I got a chance to ask it, but in any event there are a couple of things I want to say.

The job-evaluation section of the dispute was one with which I was very concerned. I am very grateful, Mr. Minister, that you have said that the government is prepared to pick up the full tab — I am repeating it to be sure that I heard what you said — to pick up the full tab for the cost, whatever it may be, for the job evaluation report.

I recognize, as you do, that one of the components of the job evaluation report had to do with the struggle on the part of women to get equal pay for work of equal value. What the previous government tried to do, dealing specifically with the orderlies and with the women with a different title but doing basically the same kind of work, was to close the gap which had grown over the years between the incomes of these two groups. As happens in most instances of traditional injustices, it was a very expensive job. It cost $3 million just to deal with that one specific group.

But that was just the beginning. It was not intended that that was where it was supposed to end; that was just the beginning. I hope that the commitment made by the Minister of Labour in section 6 of this bill towards putting out $6 million to an assessment of the entire job evaluation field is also, and must be, accompanied by the Minister of Health's commitment to pick up the whole tab for that job evaluation when it is completed.

The other component with the job evaluation's trouble has to do with part-time employment, and in fact the right of people who cannot work full time to secure part-time employment in the health sector in the hospitals. You know what Vancouver General Hospital did when it had to cut back for financial reasons. The first people it started to lay off were its part-time employees. A number of these employees had been working up to 30 years as part-time employees because that was the only amount of time they could put in on the job.

I earlier cited a case about a woman who had an invalid husband and could only work in the evenings when he was asleep. There is never ever going to be a time, as long as he's alive, that she will be able to hold down a full-time job. She was one of the people that Vancouver General Hospital decided, in terms of its cutback, should be removed from her job.

So I certainly hope that the job-evaluation study and assessment takes into account the rights of part-time employees to some kind of job security too, that they shouldn't always be the first ones to lose their jobs. I accept the minister's statement that the discriminatory factor involved in salaries is going to be dealt with.

What I'm not clear on is how this is going to fit into the AIB guidelines because, as you know, they are on a percentage thing. So maybe when the minister is responding...are you going to close the gap first and then apply the AIB guidelines? Because if you apply the guidelines first, what the guidelines do is freeze us into disparities, which is really my major contention with the guidelines — they keep the people at the bottom of the ladder at the bottom of the ladder and never, ever deal with the business of redistribution of income. So when the minister closes the debate maybe he could respond as to whether the gap is going to be closed first and then the guidelines applied after.

What I found very disconcerting with the Minister of Health's statement was the implication he left with the House that the HLRA is not a responsible group, that in fact the reason why he was unable to make a commitment to back up any kind of collective agreement they made with the union was because he had no idea what this commitment would be.

Now here we have people duly elected to the board who, hopefully, are responsible individuals. We would have hoped that the minister would have had some respect for their competence and their responsibility in terms of negotiating a sensible collective agreement with the trade union movement, with the employees on the job. That is what I think was being said by the New Democratic Party, the Liberals and the Conservatives when we said that this strike need never have been. It was a totally useless confrontation between the employees and the employer which was triggered by the reluctance on the part of that minister to treat with some kind of respect the Labour Relations Board — which was bargaining on behalf of the government, quite frankly. That's what the board was doing. To assume that to say to them that we will honour any negotiations or any collective agreement which you bargain will open the door to irresponsible behaviour on their part, I think, is really an indictment of that board, and possibly they deserve some kind of an apology from the minister for that.

I'm glad the strike is going to be over, quite frankly. From the very beginning I never dealt with the Minister of Labour; I always dealt with the Minister of Health, specifically as it applied to Vancouver General Hospital, because the agreement which the employees accepted — the Blair report — many, many days ago is in fact not as beneficial to them as this agreement which has been brought down by Judge McTaggart.

The whole extension of the strike was unnecessary and could have been avoided if the Minister of Health in the beginning had had some kind of respect for the negotiating powers of the HLRA and had said to them: "Negotiate a good collective agreement and we will honour the contract." This entire thing could have been avoided. This entire dispute, this confrontation between the employees and the hospital could have been avoided. It really was a very

[ Page 2499 ]

tragic confrontation because people who have to work in a medical setting with people who are ill...the kind of hostility generated as a result of this strike not only was totally unnecessary, but it's going to take a very long time to subside. That is really very tragic.

I'm sorry that the Minister of Health is not in the room, Mr. Speaker, because he's the person to whom my remarks are being addressed, not to the Minister of Labour because, certainly, I recognize that this is a piece of labour legislation and that is the reason why he is introducing it.

But the person responsible, and who must be held responsible for that unnecessary and useless labour confrontation, has to be, first of all, the Premier of this province, who made the decision that the Minister of Health should not honour any collective agreement negotiated between the Hospital Labour Relations Association and the Hospital Employees Union.

HON. MR. WILLIAMS: Mr. Speaker, I wish to thank the members for their contributions in this debate and I will do my best to answer some of the questions which they have raised.

I think I can answer the principal argument put forward by the member for Prince Rupert and, to some extent, by the member for North Vancouver-Capilano and by the first member for Vancouver-Burrard if I respond directly to what she said about this being a useless strike.

I guess in essential services all strikes are useless strikes, because they are eventually resolved. I think that if one considers the loss to the employees during the period of the strike and the burden on those who have services denied to them, the benefits that may be achieved by anyone as a consequence of this kind of action must surely weigh on the side of uselessness.

I think it is wrong for the members to suggest that it was because of a reluctance on the part of the government to make its commitment financially that brought about this dispute. Let me remind the members that Mr. Blair, the industrial inquiry commissioner, was appointed on December 9, 1975, by the former Minister of Labour (Mr. King) . That means that by that time negotiations had already broken down. The parties had not been able to achieve a collective agreement through the normal processes of collective bargaining. Let me advise the members that the union gave up its right to compulsory binding arbitration at that time in order to encourage HLRA to accept and agree to Mr. Blair being appointed.

I'm not sure, as I look at the matter in retrospect, that I consider that that action of HLRA was responsible. They wouldn't agree until they got something from the union, and that was before I became minister and while the former government was in place. Why didn't the former government say to the HLRA, "Don't worry about the costs. We'll pay it"? Obviously the former government and the former Minister of Health (Mr. Cocke) didn't think that was an appropriate way to resolve collective bargaining issues in hospital services in this province, and we don't either. It was a very good reason, because if you simply say to the employer's negotiators, "Don't worry what the cost is, " then there is little incentive for them to negotiate.

I would also like to remind the members that, as the member for North Vancouver-Capilano said, HLRA spent some of its money — public moneys, but still paid for by the hospitals. Their budget is $500,000 a year, but some of it went to pay this ad. They didn't blame the Minister of Health. Their clear statement was:

"HLRA firmly believes, in the light of accelerating hospital costs" — this is the maximum of 8 per cent — "that can be economically justified, a great many people support this stand and support it strongly. If the hospital employees were underpaid or lacked benefits by others in the community, HLRA could perhaps consider a greater settlement. Such, however, is not the case. B.C. hospital employee wages are currently equal to or better than most other wages in the, community and at wage scales higher than hospitals in most other provinces."

That's the position of the management negotiating team. Nowhere in this ad do they say: "If the Minister of Health would just give us a blank cheque then we could accept the Blair report without difficulty." They had to be bargained into Blair, and they've had to be bargained out of him as well.

There's no point in criticizing HLRA. We have to look for some better mechanism, and I think the member for Oak Bay touched on a very important point as to the resolution of this matter of public sector dispute. The essential service concept is a difficult one, and I just wish to assure you, Mr. Speaker, and the member for Oak Bay that the most careful consideration is presently being given to just that legislative programme. I'm not promising it soon. It's difficult. It has been attempted in other jurisdictions without much success. But because of what we recognize in this dispute, and the member for North Vancouver-Capilano put it, I thought, very well if I noted his remarks correctly: "The union was bargaining with the government and HLRA was bargaining with the government."

When you have that kind of involvement of the government.... It applies in education and it applies in human resources. All the public sector depends upon the funds that are made available through government. When you have this situation developing in essential services disputes — we have it in the

[ Page 2500 ]

ferries — you know, it all comes back to government. When you have that three-way negotiation, with the government as the taxpayers' representative in the middle, then some new technique has to be found. I wish to hasten to assure the member for Oak Bay (Mr. Wallace) that when I say we're seeking a better way it is one which will ensure that it's fair to the employer, the employee and those who desire the service.

The member for North Vancouver-Capilano (Mr. Gibson) was absent, I think, when the hon. Minister of Health (Hon. Mr. McClelland) dealt with the question of autonomy. I, too, believe that autonomy should be maintained at the local hospital districts because so often they are in a better position to make accurate decisions as to the kind of service that is required in particular communities, be it large or small. I would hate to see the situation arise when suddenly the whole hospital system was suddenly administered from some place in this city. I think that would be a wrong move.

At the same time, though, when government makes the funds available, I think those hospital boards must consider very carefully the decisions they make and the demands that are reflected by those decisions on a taxpayer. This is what I meant to indicate when I said that there had to be some differing attitudes adopted. Those hospital boards have got to be careful on what they plan, and when they negotiate with their employees they must negotiate fairly but rigidly to make certain that the services that they supply don't escalate beyond the ability of the taxpayers to provide them.

The member for North Vancouver-Capilano raised the question about the appendix 1 agreement. The appendix 1 agreement is essentially the agreement that was appended by Mr. Blair to his industrial inquiry commission report, with the three changes that I mentioned. I think it is significant, however, when talking about this agreement, to recognize the extent of the involvement of the negotiations before Mr. Blair ever even got into the matter last December.

When they went into the round of negotiations, the union presented 60 demands and clarity proposals on their agenda and the employers' association presented 38 demands and clarity proposals on their agenda. Practically all of them were resolved before Blair even came onto the scene. This is something which must be borne in mind when we consider the cost of this settlement that's involved in this agreement. Except for vacations, wages and COLA, almost every one of the cost items in this contract was agreed to by the parties before they even got to Blair. The dental programme and other intangible expense items were already agreed to.

[Mr. Speaker in the chair.]

This brings me back to the whole question of the way bargaining takes place. It's not good enough for the employer and the union to sit down and bargain all the fringes and then come along and say they can't agree on the wages. In some instances the wages are the lesser part of the package, and indeed that's almost the case here. Wages, under the Blair report and under the McTaggart report, are 8 per cent plus COLA. The COLA kicks in about halfway through the year so it's only about one-half of one per cent.

The total package is about 16, if you take the calculations used by the Anti-Inflation Board. So almost half of the whole package was in fringes already negotiated before the industrial inquiry commissioner came onto the scene. That really limits the ability of the industrial inquiry commissioner or any other third party to come in and make any impact upon negotiations.

I think one has to be very careful in these negotiations to recognize the situation which exists when the third party enters and tries to achieve some settlement. What usually happens is that the lines are hard-drawn and the issues are very few so there's not much room for the third party to move the parties, unless there is a real willingness to settle. That's what I meant about the attitudes that must be brought, particularly public sector-essential service disputes, throughout the whole of the process. It is in that area, I should say to the member for Oak Bay (Mr. Wallace), that we are giving particular concern to the methodology and the attitudes that can be brought in the final resolution of those remaining issues in dispute.

I might also point out, on this question of this being an ad hoc bill in a crisis situation, that I'm not sure that ad hockery is always bad. Every individual case may require some slightly different treatment. For example, in this case the inclusion of the job evaluation fund is a special wrinkle which you apply to this particular settlement and might not apply to this particular settlement and might not apply to any others. Sometimes you have to tailor legislation in the resolution of these disputes very specifically and that makes the job of general legislation exceedingly complicated.

The member for Oak Bay raised the question of binding awards. It sounds like an easy way out, but all it means, particularly in a public-sector dispute, is that the government then passes on to some third party the decision as to how the money is going to be spent and how much, or in the private sector the employer does it. And that raises a very, very serious question for the employer in the private sector and for the government: do we delegate this most important responsibility? If you get someone who is too lenient, who fails to recognize the consequences of the lack of restraint, does the government have to accept that?

[ Page 2501 ]

I think there has to be some better way, and perhaps the techniques that we will be discussing with this House over the coming weeks will make clear that there are methods by which government, and indeed this Legislature, can make some better decisions with the facts before it than has been the case in the past. That may be the way out of the binding arbitration concept because, as well, binding arbitration is not readily accepted by trade unions, although I must say, in my brief experience as Minister of Labour, that in the majority of cases where binding arbitration has been requested in my office it's been the unions who have asked for it and not management.

Interjection.

HON. MR. WILLIAMS: I understand what the member for Vancouver-Burrard (Ms. Brown) is saying, but what she doesn't recognize is that the growing trend in labour negotiations in North America is for the unions to ask for binding arbitration and for the employers to refuse it. The employers refuse it because they know that they lose and the unions always win with third parties. As a matter of fact, there's a classic work being written on this matter in which they reviewed the settlements in education in the province of British Columbia. It's a classic case where for years compulsory binding arbitration has been the way in which those disputes have been settled, and it can now be examined. It shows that year after year after year it is the employee who wins, not the employer. But it isn't a question of winning or losing. That's the wrong approach to it.

The $6 million, Mr. Member for Oak Bay (Mr. Wallace), I think the Minister of Health (Hon. Mr. McClelland) has answered that particular aspect. Now in the agreement.... Let's talk about the cost of implementation of the job-evaluation programme. That's not what it costs in the sense of what increases there will be in compensation to employees. As he pointed out, there are some 16,000 employees in the hospital industry who are involved in this problem. It will, as I said in my opening remarks, take much time and much effort on the part of both the union and the employer to go into each hospital in this province and work out the job evaluation, the stratification of the employees in their proper relationship one with the other, and between hospitals as well.

You know, the union is obviously going to be faced with some expense, as will be the employer. Well, that's their responsibility. But the funding of it, the three plus six plus whatever additional amount is required, will be the responsibility of the government, as the Minister of Health pointed out.

Interjection.

HON. MR. WILLIAMS: Yes, the administrative costs involved. Now if I may respond to the first member for Vancouver-Burrard (Ms. Brown) with regard to the anti-inflation and job evaluation, job evaluation under the anti-inflation programme is not taken into the calculations, so whatever the percentage increases are they will be provided separate and apart from whatever adjustments result from job evaluation. I think that your remarks are very well taken about part-time personnel and, unfortunately, I don't find that in this agreement. I suggest that this is something that the union might want to consider; there's seniority provisions and layoff provisions, but they don't seem to have addressed themselves quite directly to the part-time problem, as you have.

Mr. Speaker, as I close second reading, may I say to the members that there is a concern about time. Twenty-one days is expiring, and this union would like to be assured that it has an agreement, and so would the employer. So I move second reading now.

Motion approved unanimously on a division.

Division ordered to be recorded in the Journals of the House.

HON. MR. WILLIAMS: Mr. Speaker, with leave, I move that Bill 75 be referred to a Committee of the Whole House now.

Leave granted.

Bill 75, Hospital Services Collective Agreement Act, read a second time and referred to Committee of the Whole House forthwith.

The House in committee; Mr. Schroeder in the chair.

HOSPITAL SERVICES
COLLECTIVE AGREEMENT ACT

Sections 1 and 2 approved.

On section 3.

MR. WALLACE: Mr. Chairman, I would just seek some clarification from the minister on the understanding with which the parties will go to the Anti-Inflation Board. He may already have answered this question and I may have missed the point. I'm not sure how the impact of the job-evaluation study is to be looked upon by the Anti-Inflation Board, or whether the two parties have an understanding as to how that will be reviewed by the board — or will it be part of the review?

In other words, I know we are talking about an

[ Page 2502 ]

agreement which provides 8 per cent plus COLA clause and fringe benefits, and since the job-evaluation element in this whole dispute has been of such large significance, and since we don't knowwhat it will cost, I assume that it is not to be any part of the consideration by the Anti-inflation Board.

HON. MR. WILLIAMS: Mr. Chairman, in response to the member for Oak Bay: under the calculations made by the Anti-inflation Board, they do not take adjustments arising from job evaluation into account.So in addressing themselves to the wage increase, the COLA and the fringe benefits they will look at that and determine whether or not that percentage increase is within the guidelines and their rules. Any changes which arise from the job evaluation are ignored.

Section 3 approved.

On section 4.

MR. GIBSON: Mr. Chairman, at the commencement of this section it notes that it applies "notwithstanding the Labour Code of British Columbia," so we can only look to this section for the matters it covers. I am concerned as to whether, under the language of this section, an employee has permission to quit, or an employer has permission to lay off or discharge for cause during the term of the contract instituted by this bill. I am sure that would be the intent of the minister, that the ordinary processes of these kinds should be able to continue. Could he assure the House that this is legally possible?

HON. MR. WILLIAMS: Mr. Member, I'm sorry, but I was discussing a matter with the Clerk and I missed the first part. Could you repeat your question?

MR. GIBSON: Yes, with pleasure. I noted, Mr. Minister, through you, Mr. Chairman, that this section excludes the impact of the Labour Code of British Columbia; it has to be given effect simply within its own terminology. It notes here that "every employee shall continue or resume their ordinary duties." So I asked: does this remove from employees, during the currency of the contract imposed by this bill, any permission to quit, or to the employer to lay off — if necessary, or to discharge for cause? I wouldn't think that would be the intent, but I don't see any escape route in this section. I wonder if the minister could clarify this.

HON. MR. WILLIAMS: To the member for North Vancouver-Capilano: it's notwithstanding the Code, and the Code makes certain provisions. The employee is not exempted. But the normal provisions with respect to the rights of an employee to leave his position or to take some other position, or indeed to be disciplined for just and reasonable cause — those still continue to exist. So the normal relationships of the employer-employee continue to function, notwithstanding these specific words.

Sections 4 and 5 approved.

On section 6.

MR. WALLACE: Regarding section 6, Mr. Chairman, I'd like to ask the minister just for clarification of the language used at the end of the first paragraph. It's outlining, first of all, that there is $6 million in a fund until March 31, 1977, and then states: "...and any further money required for that purpose shall be paid out of money authorized by the Legislature."

Does that mean that such money required will simply then be incorporated as a part of the estimates of the Minister of Health, who provides the hospitals with the money to pay the reallocated staff, or does it mean that this particular bill will come back before the Legislature if another $6 million is required?

HON. MR. WILLIAMS: The funds required beyond the end of this fiscal year will be required to be voted by this House, and the vote can either appear in the estimates, or if some other legislative enactment is required in which it could be incorporated, then that would be done. But it does not require this bill to come back again before this House. This was in order to ensure that the additional expenditure will be something voted upon by this Legislature in the next fiscal year.

MR. WALLACE: Well, perhaps I didn't phrase the question very well. I just want to know how the House will be assured in specific terms what additional sum of money we might one day be discussing, and under what vote or under what piece of legislation, or in what manner will we be fully aware that the money for example, if it were an additional $5 million is specified as being for the specific consequence of this piece of legislation, and it will not just be hidden within some other collective term — let's say, under the Minister of Health's vote.

I think it is important, since we've given so much time in consideration to this bill — and we all acknowledge the uncertainty of what the job-evaluation provisions will be. I want to be assured that when the final bill does come home to roost — if that's the appropriate word; I don't suppose it is.... But when we finally find out what the total cost of the bill for job evaluation is, I would like to be assured that the House will know exactly what we are

[ Page 2503 ]

talking about and that it will be designated or clearly defined as being that item for that purpose.

HON. MR. WILLIAMS: I have discussed this matter with the Minister of Health in drafting this legislation, and it was his intention to put it in his estimates as a vote. The reason we didn't specify specifically that it would be handled in that way is that there is a possibility that when the estimates are being prepared and the budget is being established we still may not know the total cost, in which case the minister would then be obliged to bring in a bill for separate consideration and then you would know.

MR. GIBSON: Mr. Chairman, still on that point, I want to bring to the attention of the Minister of Labour a contingency. Let us assume, for the purposes of the job evaluation study, that a sum of greater than $6 million is required before next March 31. The provision in this section that it can be paid only out of money authorized by the Legislature would, I assume, prohibit the payment of any coverage out of a special warrant. Would I be correct in that? It's quite specific here that any extra money must be authorized by the Legislature, which would seem to rule out the possibility of a warrant.

HON. MR. WILLIAMS: The warrants are authorized by the Legislature, perhaps not in advance, but certainly at some point.

Sections 6 to 9 inclusive approved.

Preamble approved.

Title approved.

HON. MR. WILLIAMS: Mr. Chairman, I move the committee rise and report the bill complete without amendments.

Motion approved.

The House resumed; Mr. Speaker in the chair.

MR. MACDONALD: Before third reading I'd like to just say one word and that is of appreciation to people like His Honour Judge McTaggart who undertook this kind of task. These jobs require very intensive work over a short period of time, and there are few people in the province of B.C. with a background in industrial relations to undertake these important community projects. There are some others, and they should all be appreciated.

Bill 75, Hospital Services Collective Agreement Act, reported complete without amendment, read a third time and passed.

HON. MRS. McCARTHY: Second reading of Bill 30, Mr. Speaker.

MR. LEA: On a point of order, I think I should point out to the members of this Legislature that there was an agreement between Whips that we were going to Bill 28 at this point. It's no criticism of the government Whip (Mr. Mussallem). We have no intention of punishing or criticizing the messenger. I just want that to go on record.

HON. MRS. McCARTHY: Mr. Speaker, in response to the hon. member for Prince Rupert, we should also point out on this side of the House that an agreement was made to have unanimous leave of the House to debate the bill, which they did not give graciously earlier today.

MR. LEA: Mr. Speaker, I didn't suspect that the House Leader of government was going to use her position in a revengeful way. We're not trying to do that; we're trying to cooperate. I say again, we did have an agreement, Mr. Speaker, and I just want it to go on record that we had an agreement. The agreement has been broken not by the government Whip, but by the hon. House Leader.

MR. SPEAKER: Order, please! Could I just point out that agreements between Whips are just that: agreements between Whips. The Chair has no knowledge of those agreements, and the Chair, at this point, has been directed to second reading of Bill 30. In the process of the orderly operation of the House that is what I must call: second reading of Bill 30.

MINERAL AMENDMENT ACT, 1976

HON. T.M. WATERLAND (Minister of Mines and Petroleum Resources): Mr. Speaker, the Mineral Amendment Act, 1976, is an Act which will play some part in restoring the mining industry in British Columbia to its rightful place in our economy.

There are a number of factors in the mining industry which make it very unpredictable and therefore very high-risk: such things as the high cost of exploration for mineral properties and the unpredictable results of this exploration cost; the unpredictable nature of the metal prices which are mined in British Columbia; the unpredictable cost of putting a property into production; and the unpredictable cost, with any degree of limits, that is acceptable in the actual cost of producing from the mine.

Mr. Speaker, amendments brought in to the Mineral Act during the last government's regime placed additional unpredictable things in the way of the mining industry, adding already to the high-cost, high-risk nature of that industry. The intent of this

[ Page 2504 ]

bill is to take some of these uncertainties away. We want the mining industry to stay in British Columbia; we need their investment to provide jobs and opportunities in this province.

Amendments to the Mineral Act are intended to clarify the conditions under which mineral claim-owners can bring mines into production. The amendments remove the uncertainty surrounding the issuance of a production lease while, at the same time, they retain the requirement for a submission and approval of operating plans and data by the Department of Mines. These changes will restore confidence to the industry by producing a greater security of title to minerals and by enabling the obtaining of financing for mine development.

I might point out that under the present Act introduced in 1973, investors are reluctant to commit the large sums of money necessary to bring new mines into production in this province and even to continue the mines which are already in production. The rights of the Minister of Mines and the discretions held by him are also a deterrent to mine production in this province. These are being removed, where possible, in this legislation.

The principal amendments in this regard are as follows: the right of the free miner to mine his mineral claim is given by amending section 12. For major production, a mining lease is required which must be certified into production. It is certified into production after compliance with existing laws and regulations. Limited production may take place on a mineral claim, provided certain technical reports are submitted, without going to a lease being certified into production. Also, Mr. Speaker, the government's right to acquire interests in mining properties is removed. The government spending of tax money in the mining industry, in my view, is irresponsible. Suspension of a lease at the discretion of the Minister of Mines or cancellation by the Lieutenant-Governor in-Council has been removed.

In another area, the value of work to be performed on mineral claims to keep them in good standing has been reduced to $100 a year for the first three years of the mineral claim's life. This is to give a break to the prospector, Mr. Speaker, for it is he who owns the mineral claim for the first few years of the life of the claim. If the claim is to continue, by that time it is generally in the hands of mine developers or financiers and work is carried on in a serious nature. Increasing the work requirement at that time is of no great handicap to the prospector. But having to come up with $200 worth of work each year on a claim in its initial stages was a great handicap to the small individual prospector and was quite a deterrent to him to acquire mineral properties and to develop them to the point where they could be turned over to developers to place into production, hopefully, someday.

The cost of retaining a claim goes up after three years to $200. After a claim is changed to a lease, the cost goes up to $400. This will have the effect of discouraging people from sitting on viable claims for extended periods of time. We want to see these claims placed into production so that all of British Columbia can benefit from them.

During 1972 to 1975, Mr. Speaker, we had quite a fluctuation in metal prices in British Columbia. During the time that they were low, members of the now opposition, the then government, said that the reason the mining properties weren't being developed in British Columbia was because of the low metal prices. But during that same period of time we had the highest metal prices in history. So what then was the deterrent for mines going into production? The deterrent was the unpredictable nature of the changes made to the Mineral Act which really discouraged people — investors — from putting money into the British Columbia mining business.

This Mineral Amendment Act, Mr. Speaker, will provide some degree of predictability to the mining industry insofar as its relationships with the government are concerned. As I said in my opening remarks, we do want the mining industry to stay in British Columbia and we do need it. We need the investment in this industry to provide jobs in the province. Mr. Speaker, I now move second reading of this bill.

MR. LAUK: Mr. Speaker, the official opposition will have only two or three questions to ask with respect to this bill in terms of committee. We regard the bill to have great ministerial discretion. It's not a bad bill, particularly having regard for the personality who occupies that present office, but as well....

Interjection.

MR. LAUK: I think it would be advantageous to limit his discretion. He used his discretion with respect to a gentleman who was involved in an advertising agency, and we're a little concerned about that. We feel that every effort the Legislature could make to limit his discretion would be appropriate.

In any event, we do feel it's a pity that opportunities are not taken with respect to the public and its interest in the mining industry. It's obvious, Mr. Speaker, that this minister has no understanding or cares not even to recognize the public interest in the mining industry.

He has assisted, aided and abetted the mythology that's been created by the mining industry and the coalition party. This mythology is that the taxation policies and the ministerial discretionary policies and so on had a real negative effect on the mining industry. Now the mythology in some circles in our society has taken hold, but it's untrue and it's false.

[ Page 2505 ]

We must stand in the House and say the unpopular thing. It is false, and it's aided and abetted by some people who should know better but who are misled, Mr. Speaker.

AN HON. MEMBER: By their cultural background.

MR. LAUK: By their cultural background, by the fact that they were vastly overeducated beyond their capacity and are overly impressed with the fact that a degree from some Boston university, little known in these parts, enables them to make judgments with respect to economic matters.

But what's your excuse, Mr. Minister, through you, Mr. Speaker? From all reports, you're undereducated. Has the minister been cadged, deceived, sold by the movers and the shakers in the multinational corporation boardrooms? Has Burnett impressed you by coming and seeing you? Has he come to your office and impressed you? You know, really you've been sucked in — you really have. The pathetic display that you showed with the Fothergill debacle indicates your naivety and the dangerous situation that this province is in, because that portfolio is in the hands of a man who is too easily impressed.

I've never seen such an obsequious display that has occurred since his appointment as Minister of Mines towards the mining industry. I've never seen such a completely irresponsible rejection of the public interest from that minister. He's a minister who will spend public dollars, government money on his friends to provide not even an advertising campaign for the public interest but an advertising campaign for the mining association. Well, then he was asked and he said: "Oh, well, what's good for the mining association is good for the province." He believes it. Most of those members over there believe that.

Well, we're going to have more to say about his minister's policies in another bill — a devastating, shocking, ridiculous sellout bill that will come up later on — but I certainly won't bring that up under the purview of this bill, Mr. Speaker. I would never do that.

With respect to the ministerial discretion, I am disturbed at one part of the bill that's before us.

Interjections.

MR. LAUK: That is slander! The notes of the hon. Liberal leader (Mr. Gibson) on his bill slander us.

AN HON. MEMBER: Explain.

MR. LAUK: Never!

These are changes which reflect the need for securing a greater understanding with the mining industry. That was begun under the previous administration, and it would have been completed.

We don't agree with all of the amendments, Mr. Speaker, but we agree with enough of the amendments that the opposition will support the bill in second reading.

I think it was incumbent upon the government to listen to the mining industry, to listen to where they have real concerns about predictability for their vast capital investment. Now that's reasonable and our administration was prepared to be reasonable.

We appointed the committee to look into these and other matters, which was summarily dismissed — not by that young minister but by the orders of the hawks in his cabinet, particularly the Premier (Hon. Mr. Bennett) and the Minister of Economic Development (Hon. Mr. Phillips), that well-known cynic from Dawson Creek.

Interjection.

MR. LAUK: We don't blame the young minister.

So we were in favour of having a good look at the ministerial discretion that was causing some of the real planning and corporate planning problems in the mining industry. But we certainly, at this stage, cannot let it pass without commenting on the fact that by agreeing to these amendments we by no means endorse or agree with the policies of that minister or his government. In fact, we are alarmed at the way he is acting as a mere puppet, a mouthpiece, for the mining industry instead of accepting his responsibilities to the public as a whole.

MR. GIBSON: I think this bill is generally best handled in committee, but there are a couple of things that should be said at second reading. The hon. member who just spoke referred to the mythology which, in his view, surrounds the mining industry of British Columbia. I would suggest, Mr. Speaker, that it is the NDP who have "mythed" the point. (Laughter.)

MR. LAUK: You know, you amused Senator Foghorn over there.

Interjections.

MR. GIBSON: Mr. Speaker, declining prices were not the answer for the unhappy performance of employment in the mining industry in British Columbia in the last couple of years.

MR. LAUK: You're a "mythtake".

MR. GIBSON: It's your "mythtique" that's doing it. (Laughter.)

[ Page 2506 ]

AN HON. MEMBER: Don't make any more pithy comments.

MR. GIBSON: If you look at the prices in 1974, Mr. Speaker, they were excellent, and yet exploration was on the downtrend in British Columbia.

MR. LEA: Did you think maybe the capital was on strike fund?

MR. LAUK: Do you think it was a deliberate move by the mining association?

MR. GIBSON: There's a suggestion — from my right...

MR. LEA: From your right — that's right!

MR. GIBSON: ...that capital may have been on strike in those years. But what puzzles me, Mr. Speaker, is that the strike seemed only to be in British Columbia, because the exploration was going on all around us — in Washington, in Alaska, in the Yukon and the Northwest Territories. Exploration was going on in those areas and not here, so we have to look elsewhere for the reason.

MR. LEA: You've proved our point.

MR. LAUK: And Chile — they went to Chile.

MR. GIBSON: Hon. members to my right, I have proved your point if your point is that the mining policies of the previous government made it disadvantageous for capital funds to flow into the mining industry in British Columbia. If that's your point, yes, I will agree that I've proven that.

MR. C. BARBER (Victoria): They were on strike.

MR. GIBSON: That's not a question of being on strike; it's a question of where you're going to work, and unfortunately there was the ability to work elsewhere.

Interjections.

MR. GIBSON: My offer is still open — I will come to your convention this weekend and explain these things if you want me to.

MS. BROWN: Don't you dare!

MR. LEA: Sign that man up.

MR. GIBSON: The minister, in opening second a reading, spoke of the reduction of uncertainty, and that's the absolute fundamental of the mining industry. It is a tremendously uncertain industry, and anything of a human-created nature that adds to that uncertainty unnecessarily is a bad thing. And more ministerial discretion than is absolutely necessary is, therefore, a bad thing.

The more uncertainty you have, the higher rate of return any given industry needs before it is, on the average, profitable to go into business. Therefore uncertainty raises the cutoff grade in this province in he same way as mineral royalties do — that's something that's not generally understood. But uncertainty in the mining industry robs the people of British Columbia of production of what would otherwise be ore, but is turned into waste rock by uncertainty. So I support the bill in that context.

Some of the very good things are done — the old section 7 is repealed. I am referring now to the notes on my copy of the bill, which the hon. first member or Vancouver Centre (Mr. Lauk) felt to be slanderous, but I feel they are telling the truth...

MR. LAUK: Go ahead, say it in all your naivety.

MR. GIBSON: ...because what I have written beside section 4 here, which refers to section 7 being repealed, is "blackmail clause gone." I think that's correct...

MR. LAUK: You sound like a headline writer for the Province.

MR. GIBSON: ...because the old section 7 gave to the Lieutenant-Governor-in-Council the most extraordinary and arbitrary powers to deal with a mineral claim after its discovery without proper provisions as to compensation. And whenever there is provision of expropriation of an earned right or asset without proper compensation, then that to me is wrong, and in effect this old section 7 did that.

Included in this bill is a clarification of the right to mine that which you have discovered, as long as you adhere to certain things which are outlined in section 4. Included in this bill is the right for the small miner to go into a limited production lease so he can proceed with fewer technicalities.

We're not talking about height, Mr. Member. We're talking about a small miner in terms of....

MR. LAUK: I've yet to meet a small miner who has put a mine into production.

MR. GIBSON: The reduction of the necessary work per claim for the first three years is a good thing and will encourage activity. The new section 64removes most of the discretion and sets down clear and enforceable rules...

Interjections.

[ Page 2507 ]

MR. GIBSON: Would you like an adjournment, Mr. Member?

...after which the gold commissioner must certify a mining lease, once it's reached that stage. This to me is progress.

Mr. Speaker, with all of those good things going for it, and in particular with the overall asset that this bill reduces ministerial discretion, which is something this Legislature should always be seeking to do whenever we can, I support it.

HON. MR. WATERLAND: Mr. Speaker, I expected to have some opposition from the members opposite but all I got was a dissertation on advertising from the former young Minister of Mines.

Mr. Speaker, I move second reading of this bill.

Motion approved unanimously on a division.

Division ordered to be recorded in the Journals of the House.

HON. MR WATERLAND: Mr. Speaker, I move the bill be referred to a Committee of the Whole House to be considered at the next sitting of the House after today.

AN HON. MEMBER: Division!

MR. SPEAKER: Division has been called on the motion to refer.

Motion approved unanimously on a division.

Division ordered to be recorded in the Journals of the House.

Bill 30, Mineral Amendment Act, 1976, read a second time and referred to Committee of the Whole House for consideration at the next sitting after today.

RAILWAY AND FERRIES
BARGAINING ASSISTANCE ACT

Hon. Mr. Williams presents a message from His Honour the Lieutenant-Governor: a bill intituled Railway and Ferries Bargaining Assistance Act.

Bill 58 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

HON. MRS. McCARTHY: Second reading of Bill 57, Mr. Speaker.

MINERAL RESOURCE TAX ACT

HON. MR. WATERLAND: Mr. Speaker, after the response the last mineral bill had I'm sure that the members of the opposition have realized how wrong they were a few years ago when they introduced mineral royalties in British Columbia. I'm sure that this bill will also receive unanimous support of the House.

MR. WALLACE: Don't bet on it.

HON. MR. WATERLAND: Mr. Speaker, mining has always played a very important part in the economy of British Columbia. In fact, it was mining that first started the settlement of the province beyond the lower mainland of British Columbia. It was miners who went up the Fraser River in search of gold, and other things followed. People stayed behind to farm, to ranch, to develop our forest industry; and mining can play equally as important a role in the future development of British Columbia, in the continued economic well-being of this province.

However, as I have stated, and as I am sure is agreed by all members of this House, the mining industry is a very, very high-risk industry and it does require some return on invested capital if we are to have an industry.

The legislation which was brought down in haste by the previous government, without adequate study, was to the detriment of this industry. It provided, really, a level of taxation by government which discouraged and prohibited exploration and investment in this industry. The former young Minister of Mines and Petroleum Resources, the member for Vancouver Centre (Mr. Lauk) had set up a commission to investigate the results of his legislation long after it had had the disastrous effect it did have on the industry. Many, many people in this province are dependent upon the mining industry for their way of life. In fact, everyone in this province is dependent to a certain extent on the mining industry. Certainly those employed directly in the industry are aware of this, and there are literally hundreds of companies in British Columbia who are also dependent.

The former young Minister of Mines takes great glee in talking about the advertising campaign which I was trying to encourage by a group called the Mining Support Group. Mr. Speaker, I have a list here of the companies who are involved in this Mining Support Group. There are 258 companies on this list. Each of these companies has employees, and all of these employees of these 258 companies none of which, by the way, are mining companies but all of these companies employ people who are dependent upon the mining industry. Our whole society, everything we have in a modern society, is dependent upon mines. Even the house you live in would not be possible without the products of mines. The mining industry in British Columbia is a big part of the

[ Page 2508 ]

mining industry of Canada and is a tremendously large part of our economy.

The former Premier (Mr. Barrett), who will be joining us again soon, used to say — in fact, I have a little quote written down which he made in 1972 — "Unless we can get a better deal for what we are doing, we will leave the ore in the ground, and I mean it."

Mr. Speaker, that is exactly what happened to the ore which belongs to the people of British Columbia. It stayed in the ground and it benefited no one. It benefited no one, Mr. Speaker, and it never will benefit anyone unless it is developed and produced.

If you think a mine benefits no one unless you can get a direct royalty from it, talk to the people in Merritt or Ashcroft or Princeton or any of the other many, many communities in this province which depend on the mining industry. If you visited Merritt prior to 1958, it was a little cowtown. I have nothing against cowboys and ranchers, but it was a very depressed area with a bit of ranching and forestry base. Craigmont Mines came along and went into production in 1961. That town began to grow and to prosper and it has even since. It's a very prosperous little town in the Nicola Valley because of one mine. We have Ashcroft and Logan Lake dependent upon the Highland Valley. We have a tremendous amount of business throughout the city of Kamloops and the entire interior dependent upon the mining industry in the Highland Valley.

If we had had the type of legislation which existed for the last three and a half years in effect when Spud Hustis was trying to develop Bethlehem Copper, we wouldn't have had Bethlehem Copper. We wouldn't have had Lornex Mines; we wouldn't have had Endako or Gibraltar of Similkameen or Brenda or Island Copper. We wouldn't have had any of these mines which employ an awful lot of people in this province and we wouldn't have had the companies in business who will provide support to the mining industry.

Directly in the province there are some 16,000 or 17,000 people employed by the mining industry, but you can multiply that figure many, many times over to get the true effect of this industry on our economy. Does the clerk in the department store in Vancouver realize how much she is dependent on the mining industry? I am sure she doesn't. That, Mr. Speaker, was one of the things that I was attempting to do in supporting the mining support group and which I will continue to do to make the citizens of British Columbia aware of just how important this industry is to their well-being.

Mr. Speaker, we are competing in world markets. We have no control over these markets because we actually add a very small percentage to the total amount of metals produced in the world. We are dependent upon world prices. We have to compete with other countries and with other parts of Canada. Some of them are the same companies — some of the terrible multinational companies that originated in British Columbia. We must compete with the world because the world does not really need our ore, but we need the value that this ore adds to the economy of British Columbia.

Mr. Speaker, during the term of the previous government seven or eight mines closed down in British Columbia. It was not the fault of that government. The mine closures were hastened by the royalties but they would have closed eventually because all mines someday will close. But under the proper climate, there will always be more mines opening up than there are closing. As a mine is worked out, the new mines will replace them and continue to provide the jobs and the opportunities for our citizens and will continue to provide a great contribution towards the way of life which we have come to know and expect.

Resources and our resource industries, Mr. Speaker, are not a bottomless well of tax revenue. We must remember that. They will pay taxes, Mr. Speaker, and they will also, given a chance, pay wages. They will also pay a return for the investors who invest in them, for without a return to the investors we will have no mines, we will have no wages and we will have no revenue for the government. It's that simple.

If too much of the revenue from our mineral industry is taken by governments, none is left for wages and none is left for profits to be shared among the people who invest their money. We all seem to get the impression from listening to the opposition that it's a great monster of a thing, these corporations which devour the revenue from these mining companies.

Mr. Speaker, there are many, many small people — people like us — who invest some of their savings in mining companies. Over the years many people who are now elderly have a great faith in the mining industry in British Columbia and have invested their money in this as a way of looking after themselves in their later years. Many of these people, Mr. Speaker, lost their whole life savings as a result of the onerous royalty legislation brought in by the previous government.

Mr. Speaker, the mineral objectives of this government are — as I am sure they were of the last government — to ensure for the people of British Columbia the optimum amount of revenue from the exploration of its mineral resources. That was the objective of the last government. However, with a very sketchy understanding of the industry they thought that there was a great bottomless pit of revenue available from this industry. They tried to take too much.

It is also a policy of this government to encourage

[ Page 2509 ]

exploration for and development of mineral resources to increase the mineral resource base and to maintain this base at an optimum level.

There is also a policy of this government, as I'm sure it was with the last, to encourage employment opportunities and to establish a base with further economic diversification, to encourage regional development and the development of roads and other transportation systems through the development of our mineral resource base, and also to control the environmental effect of the exploration of our mineral resources.

Mr. Speaker, it does give me a great deal of pleasure to say that Bill 57 repeals the Mineral Royalties Act, as of January 1, 1977, because it was this legislation which first aroused me and got me interested in politics. Whether or not that's a good thing I don't know, but I happen to be here right now and, as I say, I take a great deal of pleasure in repealing the Mineral Royalties Act.

Mr. Speaker, this legislation will impose a 17.5 per cent tax on net income from the operation of a mine.

MR. LEA: That is 17.5 per cent of nothing.

HON. MR. WATERLAND: This Act also provides for the repeal of sections of the Mineral Land Tax Act which will be on production from mines. I'll not go into all the details of this Act, Mr. Speaker, but the members opposite have said that there should be a fair level of taxation to the mining industry, and I must agree with them, because they are in fact exploring for, developing and exploiting — and "exploiting" is not a nasty word. They are exploiting the mineral resources of the people of British Columbia, and the people will get a return.

Mr. Speaker, the level of taxation imposed on the mining industry through federal and provincial taxation, when this bill becomes an Act, will have a maximum level of 56.875 per cent. This level provides for depletion allowances and write-off of capital expenditures as it should. The level of taxation for the mining industry in British Columbia will be dependent, of course, upon the price of metals. If I take a 20-year average mine life, the typical mining situation — which we did in our study of the taxation — and the price of 85-cent copper, which is what we're going to need in order to develop the low-grade ore bodies we have in this province, and considering the normal writeoffs, the normal exploration expenditures for mining companies over the average 20-year life, the level of taxation will be 48.6 per cent. As the mine matures and goes beyond the 20-year period, this rate will approach the maximum of 56.875, but by this time mining companies will realize that their ore body is nearing an end and probably they will reduce that level by committing dollars to exploration to further develop the resource of the people of British Columbia so we can all benefit from it.

One of the members on the Halliwell commission made a remark, in comment immediately after this bill was introduced, saying that the big mining companies will just be able to sell their products of their mines to their own smelters somewhere and thereby avoid taxation. Well, Mr. Speaker, section 4, I believe it is, of this Act makes that impossible, because the commissioner who is set up under this Act will have the right to deem a true value if minerals are sold to another company which is less than an arm's length from the producer.

Our taxation study group, when looking at the maximum ultimate return to the people from the development of their resources, did a computer study of 70 different mines in production across Canada. These were real mines and real mining situations, and they used profit-based taxes and different levels of royalties, different levels of both types of taxes, and it was demonstrated that in the long run the maximum return to the governments of this country are realized through a profit-based tax because a profit-based tax does not shrink the size of an ore body, and it doesn't increase the cut-off grade. It allows for the maximum production and utilization of the people's resource.

We need the mining industry in British Columbia; we need the investment in mining in this province. This bill, in combination with the one on which we just passed second reading, will help ensure that we do have a continuing, viable mining industry in British Columbia. Mr. Speaker, I move second reading of this bill.

MR. E.O. BARNES (Vancouver Centre): Mr. Speaker, I rise to speak on Bill 57....

MR. J.J. KEMPF (Omineca): For or against?

MR. BARNES: Well, I don't know yet. I'll have to investigate and decide. (Laughter.)

Interjections.

MR. BARNES: Mr. Member, I came before this Legislature with an open attitude. (Laughter.)

Interjections.

MR. BARNES: I'm trying to cooperate, and I listened very carefully to the hon. Minister of Mines. I'd just like to say though, Mr. Speaker, that I rise as one of the humble new members to the Legislature with very limited experience in this area, because most of my constituents are trying to plug into the system. So the message I'm bringing will be from their perspective, and I just want to tell you that as

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such I'm not a designated speaker and I'll just make a few remarks.

Interjections.

MR. BARNES: Yes, perhaps a shovel would be appropriate. But, you know, the minister said that he was motivated to go into politics because of Bill 31. Pretty soon we will be speaking of the former Mineral Royalties Act. He felt such that he was compelled to come forward on behalf of the people of British Columbia to return to them what the New Democratic Party was trying to take away — trying to save.... I guess that's what he was implying: that we were trying to save the minerals of the province for posterity. He felt that he wanted to come and move it on because he felt that mining sites usually have a life expectancy of about 20 years or so.

But, you know, I think what is happening is that a political commitment was made, Mr. Minister, despite your pronouncements of hoping that you wouldn't have to be political, even though you came in because of politics. It was a political decision to come in but you would like for us to feel that this is an act of responsible government. But it certainly is an act of irresponsible management of the people's resources, because what you are doing is giving away the resources of the province under the guise of being able to get a return if there should be any profits.

Most of you people on that side of the House are very familiar with the old game of showing no profits, especially if you're going to be successful in business. You show profits; the curve goes down. You show no profits; the curve goes up. So not knowing quite from personal experience what you've done...I've just been observing how business is taken care of. You've got to have some way by which to fleece the public. I can bet you right now that you won't realize what you think you're going to realize in the way of profits on net income, net proceeds, from any of these operations, because you permit too many loopholes.

I think that this isn't a very responsible way to go, Mr. Minister. I feel that any kind of a person who goes into business should be required to pay a fee at the beginning, not at the end. Because in many cases what if they failed? And they're going to fail, at least by the time they get around to showing a net profit, with all of the dodges and ways of writing off capital costs and operating expenses and trips to Hawaii, or wherever they want to go, buying up sites for exploration, holding onto them and accruing land accumulation and so forth and so on. There'll never be any profits.

Are you going to put a limit on the extent that they can explore? Are you going to have a system set up so that you can keep a surveillance on all activity? Are you going to put a limit on what is acceptable and what is not acceptable for expenses? You know, I just think it's carte blanche, and I think that we will find that there just won't be any profits.

Well, you know, this is a bill that is quite serious because all of the people of British Columbia are going to be affected. I don't think that we should be in any real hurry to allow it to slip through, although I think that the government has been very clever in introducing this bill at this time for second reading in between certain other pieces of legislation that are probably going to get the headlines. You'd like to slip it in and slip it out and get on, but, you know, this is the kind of bill that really should be talked about when the press gallery is filled up and we can find out what you're going to give away.

Interjection.

MR. BARNES: No, you're going to get an opportunity to talk. I would like to ask....

Interjection.

MR. BARNES: Thank you, Mrs. Provincial Secretary. I would like to ask that debate on this bill be adjourned until the next sitting of the House.

Motion approved.

PUBLIC SERVICE BENEFITS PLANS ACT

Hon. Mrs. McCarthy presents a message from His Honour the Lieutenant-Governor: a bill intituled Public Service Benefits Plans Act.

Bill 64 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

PUBLIC SERVICE ACT

Hon. Mrs. McCarthy presents a message from His Honour the Lieutenant-Governor: a bill intituled Public Service Act.

Bill 81 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

PUBLIC SERVICE LABOUR RELATIONS
AMENDMENT ACT, 1976

Hon. Mrs. McCarthy presents a message from His Honour the Lieutenant-Governor: a bill intituled Public Service Labour Relations Amendment Act, 1976.

Bill 82 introduced, read a first time and ordered to be placed on orders of the day for second reading at

[ Page 2511 ]

the next sitting of the House after today.

MOTOR-VEHICLE AMENDMENT
ACT, 1976 (No. 2)

Hon. Mr. Davis presents a message from His Honour the Lieutenant-Governor: a bill intituled Motor-Vehicle Amendment Act, 1976 (No. 2) .

Bill 66 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

MOTOR-VEHICLE AMENDMENT
ACT, 1976 (No. 1)

Hon. Mr. Davis presents a message from His Honour the Lieutenant-Governor: a bill intituled Motor-Vehicle Amendment Act, 1976 (No. 1) .

Bill 68 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

MOTOR-VEHICLE AMENDMENT
ACT, 1976 (No. 3)

Hon. Mr. Davis presents a message from His Honour the Lieutenant-Governor: a bill intituled Motor-Vehicle Amendment Act, 1976 (No. 3) .

Bill 80 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

HON. MRS. McCARTHY: Mr. Speaker, the Lieutenant-Governor is here.

MR. SPEAKER: Hon. Members, the Lieutenant-Governor is about to enter the chamber. Will all arise?

HON. MR. GARDOM: You only do that on the third day, Mr. Speaker.

His Honour the Lieutenant-Governor entered the chamber and took his place in the chair.

MR.CLERK:

British Columbia Railway Company Construction Loan Amendment Act, 1976

Revenue Amendment Act, 1976

Supreme Court Amendment Act, 1976

Constitution Amendment Act, 1976

Anti-Inflation Measures Act

Provincial Homeowner Grant Amendment Act, 1976.

Extra-Provincial Custody Orders Enforcement Act

Interprovincial Subpoena Act

Interpretation Amendment Act, 1976

Prospectors Assistance Amendment Act, 1976

Auditor General Act

Hospital Services Collective Agreement Act

In Her Majesty's name His Honour the Lieutenant-Governor doth assent to these bills.

His Honour the Lieutenant-Governor retired from the chamber.

Hon. Mrs. McCarthy moves adjournment of the House.

Motion approved.

The House adjourned at 5:59 p.m.