[ Page 3015 ]

CONTENTS

Speaker's ruling

Legality of June 22 sittings of Legislature.

Mr. Speaker — 3015

Mr. Gibson — 3015

Mr. Macdonald — 3016

Routine proceedings

Farm and Domestic Workers Recognition Act (Bill 84) Ms. Brown.

Introduction and first reading — 3016

Oral questions

Canyon Ambulance Services dispute. Mr. Barber — 3017

Canadian Habitat delegation submission on unearned profits on land.

Mr. Gibson — 3017

Ministerial role in range war. Mr. Barrett — 3017

Adjustment of rent controls. Mr. Barnes — 3018

Premier's mode of transport. Mr. Lea — 3018

Tent Island lease withdrawal. Mrs. Wallace — 3019

Additional seating on ferries. Mr. Gibson — 3019

Closure of Port Alberni ICBC claims centre. Mr. Skelly — 3019

Comparison of ferry-use figures. Mr. Lockstead — 3019

B.C. cost in Olympic torch-carrying. Mr. Barnes — 3020

Committee of Supply: Department of Mines and Petroleum Resources estimates.

On vote 130.

Mr. Gibson — 3020

Mr. King — 3021

Hon. Mr. Waterland — 3021

Mr. Nicolson — 3023

Hon. Mr. Waterland — 3024

Ms. Sanford — 3024

Mr. Lockstead — 3027

Hon. Mr. Waterland — 3028

Mr. King — 3029

Mr. Gibson — 3032

Hon. Mr. Waterland — 3034

Mr. Barrett — 3036

Mr. King — 3051

An Act to Incorporate the Bishop of the Ukrainian Catholic Eparchy of New

Westminster and His Successors in Office a Corporation Sole (Bill 50) Second reading.

Mr. Strongman — 3052

An Act to Incorporate the British Columbia Association of Colleges (Bill 51) Second reading

Mrs. Jordan — 3052

Vancouver Stock Exchange, 1907 (Amendment) (Bill 52) Second reading.

Mr. Chabot — 3052

The House met at 2 p.m.

MR. J.J. KEMPF (Omineca): I am very happy to have in the gallery this afternoon students from the Nechako Valley Secondary School with their teacher, Mr. Blatner, and his good wife. They are from the village of Vanderhoof in the great constituency of Omineca, and I would like the House to make them welcome.

MS. K.E. SANFORD (Comox): Seated in the members' gallery today are two people from Comox constituency, and I would like the House to join me in welcoming Betty Hlookoff from Courtenay and my son, Glen Sanford.

MR. L.B. KAHL (Esquimalt): From that great constituency of Cowichan-Malahat, I would like the House to join me in welcoming the mayor of Duncan, Mr. Ken Paskin.

MR. D.F. LOCKSTEAD (Mackenzie): I have in the gallery today two guests from West Vancouver, Mr. and Mrs. Maurice Embury, and I ask the House to join me in welcoming them.

HON. J. DAVIS (Minister of Transport and Communications): Mr. Speaker, seated in the members' gallery today is Mr. Art Lipman from North Vancouver. He's one of the most energetic campaigners I know. I would like the House to make him welcome.

MR. G.R. LEA (Prince Rupert): Was he on your side or Trudeau's?

HON. E.M. WOLFE (Minister of Finance): I ask leave to table a document. It has to do with our anti-inflation programme.

Leave granted.

HON. MR. WOLFE: Mr. Speaker, we have now concluded our agreement under the federal Anti-Inflation Act with the Government of Canada, which has been signed as of yesterday, and I have pleasure in tabling this agreement.

MR. SPEAKER: Hon. members, just prior to the adjournment for lunch the Speaker was about to deliver a decision concerning a matter of a motion which was put by the hon. first member for Vancouver East (Mr. Macdonald) I am now in a position to deliver that decision. Before I do I would like to remind all of the members of the House, and particularly the Leader of the Opposition (Mr. Barrett), who suggested that he wanted it deferred for an hour because he may wish to discuss it, that under the rules of the House debate or discussion on a ruling from the Chair is not admissible, and....

AN HON. MEMBER: You're anticipating, I think.

MR. SPEAKER: I'm not anticipating anything, Hon. Member, except from the discussion that took place immediately before the adjournment.

Interjections.

MR. SPEAKER: Order, please. Even the Speaker had an opportunity to have lunch today, and I think we are all in a better mood.

Yesterday afternoon the hon. first member for Vancouver East rose on a point of privilege and presented to the Chair for consideration a motion reading as follows:

"Resolved: that a special committee on privileges be named forthwith by the select committee and directed to examine and report upon the question of the sittings of the Legislature outside of regular hours, and the lawfulness of legislative orders passed at the present session outside of the regular times of sitting, and with power to summons and hear persons and testimony."

I would make the preliminary observation that the practice of this House does not permit preambles to motions, and accordingly the motion as submitted was technically out of order in this regard, because it did have and contain a preamble.

However, as a matter of privilege alleged is one of considerable importance, I have considered the matter further to determine whether or not the substance of the motion constitutes a matter of privilege which can be placed before the House for debate without notice. Standing order 26 states as follows: "Whenever any matter of privilege arises, it shall be taken into consideration immediately."

In deciding whether or not the matter can be raised without notice I've examined several authorities, including Sir Erskine May's Parliamentary Practice, 16th edition, at page 392, and refer the hon. members to the following quotation therefrom:

"As a motion taken at the time for matters of privilege is thereby given precedence over the prearranged programme of public business, the Speaker requires to be satisfied both that there is a prima facie case that a breach of privilege has been committed and also that the matter is being raised at the earliest opportunity."

The earliest opportunity at which this matter could have been raised was the sitting of this House at 10 a.m., June 22...

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AN HON. MEMBER: Impossible.

MR. SPEAKER: ...while in fact the matter was not raised until the 2 p.m. sitting the same day.

Matters of privilege not raised at the earliest possible opportunity must be raised by notice of motion to be placed on the order paper, and in this regard I refer the hon. members to a decision of this House contained in the 1968 Journals, page 140 to 141.

I would add here that the restrictions in relation to raising a matter of privilege apply equally to a point of order, and refer hon. members to the 16th edition of May at page 470, which clearly states that points of order may be brought to the Chairman's attention provided such member raises the point the moment the alleged breach of order occurs.

There is a further ground on which the hon. member's motion appears to be out of order. The matter raised purports to deal with sittings of the Legislature and essentially matters of order within the House and as such cannot be raised as matters of privilege. I refer the hon. members to Bourinot's Parliamentary Practice, 4th edition, at page 307. The learned author, in that authority, dealing with questions of privilege, states as follows: "A question of order in the House, or in a committee thereof, cannot be treated as a matter of privilege."

It is therefore the ruling of the Chair that the matter raised by the hon. member must be raised on notice.

I wish to say further that I am indebted to several hon. members for bringing to my attention several Speakers' decisions and quotations from Sir Erskine May, all of which have been examined and considered. Hon. members will undoubtedly appreciate that as the matter raised as a matter of privilege was decided upon other grounds, detailed comments on the authorities quoted by the hon. members become inappropriate.

MR. G.F. GIBSON (North Vancouver-Capilano): On a point of order, Mr. Speaker, without wishing to take the time of the House, in my remarks yesterday afternoon I noted: "Mr. Speaker, I had intended to bring this particular question up as a point of order, but since the hon. first member for Vancouver East (Mr. Macdonald) has raised it as a question of privilege, perhaps I might suggest to you some of the authorities that seem to me to bear on the case." Then I went on to cite some authorities.

Sir, as I gave notice at that time that I did wish to raise it as a point of order, I wonder if you might now consider it as such and take it under advisement as such with the argumentation I gave at that time, which I have no wish to repeat. I would suggest to you as well that it was raised at the earliest moment, if the point of order is correct. The point of order, you will recall, suggested that this morning sitting was improperly constituted. Therefore raising it at the beginning of the afternoon sitting was at the earliest possible time. I would ask Your Honour to take that into account as a point of order.

MR. SPEAKER: The only thing that I would reply is that I think that you should refer to the ruling of the Chair that the matter raised by the hon. member must be raised on notice.

MR. GIBSON: Getting on with that point of order, Mr. Speaker, I did raise it yesterday. I said I was going to raise it as a point of order, and had that been the case at that time Your Honour surely should have told me that I should do it in that way rather than commenting on the question of privilege. I deferred raising it as a point of order, though I specified that I had wished to do so, because of the matter of privilege which Your Honour took under consideration. That being the case, it seems to me that awaiting your decision on the question of privilege, which surely has precedence over a point of order, was the proper course to do, and that therefore now is the earliest possible occasion to ask Your Honour to take it into consideration as a point of order and to give a ruling on it. I hope you will do that in due course.

MR. SPEAKER: Hon. Member, I appreciate your remarks. Without examining it in more detail, I would reserve any decision and try to accommodate the hon. member on his request.

MR. A.B. MACDONALD (Vancouver East): In view of your ruling that the point raised should be on notice and that it's not a matter of privilege that demands the immediate attention of the House, I would think that I should file the motion as a notice of motion, and I would think that the government should call that resolution forthwith, because it's a matter of great concern. I will be filing it.

Introduction of bills.

FARM AND DOMESTIC
WORKERS RECOGNITION ACT

On a motion by Ms. Brown, Bill 84, Farm and Domestic Workers Recognition Act, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Oral questions.

[ Page 3017 ]

CANYON AMBULANCE SERVICES DISPUTE

MR. C. BARBER (Victoria): Mr. Speaker, my question in one part is to the Minister of Health.

In the city of Hope, Canyon Ambulance Services has been in the dispute of many weeks with the emergency health services branch of your department. There also appears to be a considerable conflict with the council of the city of Hope regarding relocation and other problems faced by Canyon Ambulance Services.

Yesterday, as the result of this continuing stress and conflict, the manager of the Canyon Ambulance Services collapsed and is presently in the hospital. Will the minister make a report to the House as soon as he can and will he tell us what action he has taken to resolve this dispute?

HON. R.H. McCLELLAND (Minister of Health): Mr. Speaker, we're in constant discussion with the former manager of Canyon Ambulance who is now an employee of the Provincial Government Ambulance Service, and that will continue. I wasn't aware that Mary Angers collapsed and I am very sorry that she did. Other than that I can't give any further answer. It's a problem that we're hoping to resolve as quickly as possible.

Interjection.

HON. MR. McCLELLAND: Mr. Speaker, I don't know whether I'd report to the House. It's a problem which we're having all over the province with reference to the takeover of some of the ambulance services. If the member would like to come to my office I'd be happy to talk with him about it at any time.

CANADIAN HABITAT DELEGATION STAND
ON UNEARNED PROFITS ON LAND

MR. GIBSON: Mr. Speaker, a question to the Minister of Housing and Municipal Affairs. On June 15, over a week ago, I asked the minister if he supported the stand taken by the Canadian delegation to Habitat with respect to recapturing unearned increments resulting from rises in land values. The minister replied at that time that he wished to report to the cabinet before answering the question. Since I assume he has now had time to do so, could he inform the House as to whether he supported the stand of the Canadian delegation on this topic at Habitat?

HON. H.A. CURTIS (Minister of Municipal Affairs): To the hon. member, the assumption is incorrect. There has been just one cabinet meeting since the question was asked last week, and I have not had an opportunity to report to cabinet.

MR. GIBSON: On a supplementary, Mr. Speaker. Would the minister undertake to report just briefly enough to the cabinet during the next meeting so he can answer this question after the next meeting?

Interjections.

MR. SPEAKER: Order, please. That's not a question. That's a statement.

MR. GIBSON: It's a question.

MINISTERIAL ROLE IN RANGE WAR

MR. D. BARRETT (Leader of the Opposition): I would like to address this question to the attention of the hon. Minister of Highways and Public Works. It is concerning this news report of Saturday, June 19 wherein:

"Lloyd Bennett's cattle are in the arms of the law again but this time there are no signs politicians are going to bail them out. The B.C. Forest Service officials in Williams Lake confirmed Friday that they have seized 11 head of cattle that they allege were grazing on Crown lands without the necessary permission of government. Bennett has been involved in a range war with the Forest Service. Cariboo Social Credit MLA Alex Fraser, then a backbencher on the opposition side of the House, went to bat for Bennett...."

MR. SPEAKER: Could we hear the question, Hon. Member?

MR. BARRETT: Yes, I have to read this. "...went to bat for Bennett..."

HON. MR. McCLELLAND: Why don't you read Hansard of last year?

MR. BARRETT: "...and fired off verbal shots against the government and the Forest Service." Mr. Speaker, I'm coming to the questions.

MR. SPEAKER: Hopefully, very quickly, Hon. Member.

MR. BARRETT: Then I'll defer to Old Bossie. Mr. Speaker, let me finish my question. It is in two parts. First of all, I want to ask the minister why, when he was a member of the opposition, he gave service to this farmer and his cow and now he's only giving them a lot of bull as a minister? (Laughter.) He went and bailed out the cow last year. Why isn't he bailing out the cow this year? What is your answer? Why was

[ Page 3018 ]

the cow bailed out last year but not bailed out this year?

HON. A.V. FRASER (Minister of Highways): Mr. Speaker, I appreciate the Leader of the Opposition pointing these facts out. I might say in answer to the first part of the question — or the statement — that last year I was asked for help and this year I haven't been asked for any help.

MR. BARRETT: A supplementary, Mr. Speaker. I am now asking the minister for help. Will you bail this cow out as you did last year?

AN HON. MEMBER: Are you the world champion bull-thrower?

MR. BARRETT: I certainly am, and now he's competing.

HON. MR. FRASER: To answer the Leader of the Opposition, the answer is no.

MR. BARRETT: Do you provide one way of service as a member of the opposition and another as a minister?

MR. SPEAKER: Order! Order, please.

Interjections.

MR. BARRETT: I am asking him a question, Mr. Speaker.

MR. SPEAKER: Would you ask the question?

MR. BARRETT: Yes, I am asking the minister if he provides one method of service when he is in opposition but another method of service when he is a minister.

HON. MR. FRASER: Mr. Speaker, the answer is no.

SOME HON. MEMBERS: Oh, oh!

MR. BARRETT: Okay. We know what kind of guy — playing politics, that's all.

Interjection.

MR. SPEAKER: Order, please. Allow the hon. member for Vancouver Centre to ask his question.

ADJUSTMENT OF RENT CONTROLS

MR. E.O. BARNES (Vancouver Centre): To the hon. Attorney-General. Speaking of bailing out, what about the renters in the province of British Columbia, Mr. Attorney-General? As you know, they have been saddled with a 10.6 per cent maximum annual increase on rent and we had intended to bring this down to 8 per cent after this last election. Now you've been sitting still on this for a long time. Would you clarify whether or not you are moving in the opposite direction on the present rent freeze of 10.6 per cent?

Interjections.

MR. BARNES: Mr. Speaker, if this is allowed to remain for seven years, it will be a 100 per cent increase. It is already close to 50 per cent. Now we have to have something done about that. I'm sure that he is not going to leave it the way it is.

Interjections.

HON. G.B. GARDOM (Attorney-General): I tend to think that the hon. member had made his speech earlier this morning, but the second one was a good one too. I don't think I really need to reiterate to the hon. member the policy of the government, and that is to hopefully phase out of rent control as soon as possible, once there is suitable accommodation. Until such time we are going to have to stick with the controls.

Interjections.

MR. BARNES: Mr. Speaker, I didn't suggest that you phase out rent controls. I suggested that you relieve the burden of leaving it at 10.6 per cent which, as you know, in seven years will mean a 100 per cent increase. You should be either lowering it or setting up....

MR. SPEAKER: Order, please.

MR. BARNES: Mr. Speaker, there should be some way to justify any rent increase, upwards or downwards, instead of leaving it at 10.6 per cent indefinitely.

Interjections.

PREMIER'S MODE OF TRANSPORT

MR. LEA: Mr. Speaker, I would like to ask the Premier a question. On April 23 the cabinet met with the Vancouver city council. Would the Premier confirm that on that day he travelled by limousine from the Hotel Vancouver to city hall, had that limousine wait approximately six hours and the cost was about $150?

[ Page 3019 ]

HON. W.R. BENNETT (Premier): No Mr. Speaker, I can't confirm all that, but I will confirm that the member asked me this question yesterday. He asked me the question: would the Premier tell me in what mode of transportation he travelled from the Hotel Vancouver to the city hall? During that day I travelled by automobile. The automobile was a 1976 Dodge. It was leased and had been leased by the past administration...

SOME HON. MEMBERS: Oh, oh!

HON. MR. BENNETT: ...as it was arranged for the Premier this time to travel around on business in Vancouver under the same arrangements as were made for the previous government.

MR. LEA: I would like to ask the Premier if he could confirm that that price of that limousine was $150 and he had to wait approximately six hours outside city hall in Vancouver.

HON. MR. BENNETT: Mr. Speaker, I can't confirm the price — the going price the government had paid during the previous administration, and the same arrangement exists now. But I'm sure that information can be got from public accounts. I can say that the vehicle was used for several stops on that day by the Premier.

MR. BARRETT: I never used a leased car in Vancouver.

MR. SPEAKER: Order, please. That's not a question.

MS. BROWN: One hundred and fifty dollars, shocking!

MRS. B.B. WALLACE (Cowichan-Malahat): Order, please, Mr. Speaker.

MR. SPEAKER: One moment, please. Order! I recognized the hon. member for Cowichan-Malahat.

Interjections.

MR. SPEAKER: Order! The member for Cowichan-Malahat has the floor.

TENT ISLAND LEASE WITHDRAWAL

MRS. WALLACE: My question is for the Provincial Secretary. I'd like to ask whether or not she can confirm that the lease for Tent Island, which has been a marine park for some time, has been withdrawn, and if so, for what reasons.

HON. G.M. McCARTHY (Provincial Secretary): Mr. Speaker, I'll have to take that question as notice. I'll bring the information back to the member.

ADDITIONAL SEATING ON FERRIES

MR. GIBSON: Mr. Speaker, I have a question for the Minister of Transport and Communications. On some sailings, with the increase in the number of foot passengers on the B.C. ferries, I'm advised that some ferries are being filled to the point where there's not adequate room to sit on the main deck. In view of the fact that the rooms formerly used as a restaurant are now unused and closed, and no immediate plans for the space, will the minister see that those rooms are reopened to provide extra seats on these sailings where required?

HON. MR. DAVIS: Mr. Speaker, plans are being made to reopen what have been dining-room facilities on the ferries, using them for other purposes, because we expect heavy loads in the future.

CLOSURE OF PORT ALBERNI
ICBC CLAIMS CENTRE

MR. R.E. SKELLY (Alberni): My question is directed to the Minister of Education. Does he intend, as minister responsible for ICBC, to close down the claims centre in Port Alberni, which services 25,000 people in that area? If so, what will happen to the staff and supervisors, and what arrangements will be made to service claims in the Port Alberni region?

HON. P.L. McGEER (Minister of Education): Mr. Speaker, I am not aware of any plans to close that particular claims centre down, but I'll be happy to take the question as notice and see if I can get further details.

COMPARISON OF FERRY-USE FIGURES

MR. LOCKSTEAD: Mr. Speaker, last Thursday, June 16, the Minister of Transport and Communications took as notice a question on how many vehicles and passengers were carried on the major routes during the first half of this month, and also the comparative figures from June 1 to June 15 of last year. Would the minister also inform this House of the corresponding revenues to the ferries in those two 15-day periods? Is the minister now prepared to answer that question, Mr. Speaker?

HON. MR. DAVIS: Mr. Speaker, I can answer that question in part. Traffic — and I'm referring substantially to vehicle traffic on the two main routes — was down about 40 per cent in the first week of June, and roughly 30 per cent in the second week.

[ Page 3020 ]

Last week it was down around 20 per cent. It has been improving...the numbers of passengers travelling, as opposed to vehicles, was not down as much. The numbers of passengers per automobile were up from 3.1 to 3.6, so more people are travelling. The drop in passenger travel, in other words, is not down as sharply as it has been in respect to vehicles. Traffic, however, is improving and lineups and overloads are now commonplace. Financially, the income is up substantially over last year.

B.C. COST IN OLYMPIC TORCH-CARRYING

MR. BARNES: This is a question to the hon. Provincial Secretary: as I understand, the other day she took as notice a question addressed to the Premier asking what percentage of the $300,000 that was being appropriated for a group of athletes to carry a torch from Ottawa to Montreal in a programme co-sponsored with B.C. Industries. The Premier indicated that the Provincial Secretary would give us the percentage of the $300,000 that the province would be paying.

HON. MRS. McCARTHY: Mr. Speaker, I don't believe you did refer it to me, but I'd be very pleased to attempt to answer. I think, to get the exact information — I only have a generalized figure — I'll have to bring that figure back to the House.

Presenting reports.

Hon. Mr. Davis presents a report from B.C. Hydro and Power Authority for the year ended March 31,1976.

Orders of the day.

HON. G.M. McCARTHY (Provincial Secretary): By leave, Mr. Speaker, second reading of Bill 81.

Leave not granted.

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

ESTIMATES: DEPARTMENT OF
MINES AND PETROLEUM RESOURCES
(continued)

On vote 130: minister's office, $80,964 — continued.

MR. G.F. GIBSON (North Vancouver-Capilano): Just before lunch I had some things to say about undersea mining which I hope the minister will respond to in due course. I'd like to ask him about a very curious case, however, which I think could pose some potential danger to the public, and that relates to the way in which blasting ticket courses are administered by his department. There was a case up in Stewart earlier this year, I believe — which was reported to the RCMP, so I can tell him that it's no current matter of public urgency — in which a man got a blasting ticket under somewhat curious circumstances and then left the country in a way that I'll relate later.

The blasting ticket course, which deals with the management and handling of all kinds of explosives, including not just the explosives themselves but the fusing devices and the timing devices, is, according to my understanding, administered by his department. The training is given by the various mining companies around the province. My understanding is that it generally requires something like eight hours training.

In this particular case it was training given in a room off the first-aid room on the Granduc property. The usual development is that the company gives a provisional ticket which is good for use only on the property itself and then the mining inspector gives the final approval.

Interjection.

MR. GIBSON: No, this is up at Granduc, Mr. Member. It has nothing to do with the particular location or company. It could have happened anywhere in the province. It's the tightness of the regulations I'm concerned about.

My understanding is that it happened earlier on this year. In this particular case the man concerned expressed interest in making explosives and particular interest in timing devices, went through the course, obtained a provisional ticket and then left the country and went back to Ireland. There are obvious grounds for concern there. It was, I'm told, reported to the RCMP and various enquiries were made, so I'm not reporting to the minister a matter of public urgency, but what I'm saying is that anybody in any capacity in a mining operation who expresses interest can get this kind of training, according to my understanding. The minister may be able to set me right on that.

I would ask him if, in view of this particular case, he could tell us if he has given any thought or if he will give thought to tightening up the conditions surrounding the ways in which persons can gain the technical skill and knowledge necessary for the making of explosive devices, which is a skill that

[ Page 3021 ]

might conceivably be misused. I think it would be a very rare case where it would be, but on the other hand I'm certain that we in British Columbia don't want to, in effect, operate schools for persons who would make loud bangs in places other than mines in various parts of the world. I wonder if the minister would comment on that.

MR. W.S. KING (Revelstoke-Slocan): Mr. Chairman, I had expected the minister to rise and be anxious to give information to the House so that his estimates might speed through, but he seems to be continually reticent in terms of explaining the administrative functions that reside under his department. I would have thought, in light of the last few weeks, that that minister would have been a bit more prepared to be frank and candid with the House and to be cooperative in terms of supplying information and answering questions.

I am concerned about the same point the Liberal leader raised, Mr. Chairman, not only with respect to the safety of blasting permits, but with respect to the criteria used for withdrawing those certificates. I understand there have been occasions where persons who have been charged with an offence and convicted under summary convictions have had their blasting certificates withdrawn and in essence lost their opportunity to pursue their normal vocation and to continue to enjoy a decent livelihood.

I wonder if the minister could give us some indication of precisely what criteria apply in the case of criminal convictions or convictions under the Summary Convictions Act with respect to withdrawing or cancelling blasting certificates. Is it necessary that the conviction be related to a crime or an abuse of the certificate they hold, or might this be cancelled just for some ordinary unrelated criminal offence? I would like some information on that.

HON. T.M. WATERLAND (Minister of Mines and Petroleum Resources): Mr. Chairman, regarding blasting certificates — questions from the member for North Vancouver-Capilano (Mr. Gibson) and Revelstoke-Slocan (Mr. King) — the Department of Mines does not offer training courses for people wishing to obtain blasting certificates. Our function is to examine people so that we can be assured that they are competent to conduct blasting operations. There is no such thing as a formal training programme put on by the department, although some mines do conduct formal training programmes. The usual course, however, is that a person becomes familiar with handling explosives through practical experience. He must then pass examinations regarding his ability to actually conduct blasting operations and his knowledge of blasting regulations in the Department of Mines.

I cannot recall at this moment any instance where a person's blasting certificate was withdrawn because of convictions for another offence. However, I could think of circumstances where this might be necessary. When I was an inspector of mines I did withdraw a person's blasting certificate when evidence was produced that the person was perhaps not emotionally stable enough to safely conduct blasting operations. Of course, we are very concerned about the safety of people in mines. We want to be as sure as possible that those handling explosives are emotionally and technically capable of doing so.

As far as limiting people to whom you issue blasting certificates because perhaps they may go to Ireland and get involved in other types of blasting, I think this would be something that would be very, very difficult to police. If we have any indication that a person is so inclined, of course, we would be very reluctant to issue him a certificate. But we have no formal programme at this time for screening that type of motive that a person might have.

I might comment briefly on the remarks the member for North Vancouver-Capilano made regarding undersea mining. He's quite right. I think sometimes in the not-too-distant future underwater mining technology will be developed to the point where it is economically feasible. To this point I don't believe it is. I also am aware that there are mining companies whose headquarters are in British Columbia engaged in research by themselves and with companies from other countries in this technology.

However, I think we must also realize that this technology is still in its infancy and that there are going to be tremendous jurisdictional problems as far as undersea mining is concerned. There are also going to be tremendous environmental problems. I understand now that in the state of Hawaii of the United States there is quite a lobby against any possibility of any undersea mining in the vicinity of the Hawaiian Islands.

That member also made mention of the very thin edge which we now have as far as our costs in mining are concerned and that perhaps in the not-too-distant future we are not going to be able to mine economically in British Columbia. I recall a speech given by a senior member of the Department of Mines in about 1950. At this time the gentleman said: "There are no new mines going to be found in British Columbia; we have found them all." He was thinking of the type of mineral deposits that were required at that time, and of course, we realize what tremendous advances have been made in mining technology since that time. He couldn't have conceived of the idea that people just a matter of 10 or 15 years later would be mining ore deposits, copper deposits, of less than 5 per cent.

Personally, I have a great faith in man's ability to develop new technology. Perhaps in the not-too-distant future we will be mining ore of much

[ Page 3022 ]

less grade than that. Mining technology is developing at a rapid pace and I am sure there are many more breakthroughs to come. I tend to be optimistic. I know there are gloom-and-doom prophets who say that in a few years' time we will not be able to afford to mine.

But really, I do think that our technology will advance. Also, the steady demand of the world for metal products will have to force the price of these products upwards. Hopefully, the price of the minerals which we produce will go up, our mining technology will advance, and we will be able to have a viable mining industry.

I think just as important as technology and the price of metals, however, is the stability of the financial and political climate in the province where we're producing minerals. The industry must have predictability. Regardless of what type of taxation system you have, it must be such that a return for investment will be provided. It must also be predictable so that in the future prices and costs will be able to be predicted and returns also predicted to justify the very large capital expenses required to place our mines in production.

There was a question from the member for Alberni (Mr. Skelly) a few days ago — it seems like a month ago — regarding the Mineral Processing Act which came into effect, I believe, in the late 1960s. This Mineral Processing Act provided that 50 per cent of the products of mines — the concentrates — could be directed at the pleasure of the government to a particular smelter. By order-in-council, sometime after this legislation came into effect, that 50 per cent was reduced to 12.5 per cent.

It was at about this time that the Lornex mine...financing was attempted to be arranged. That company found it impossible to arrange financing for that property, which, by the way, cost in excess of $200 million even four or five years ago. That company found it impossible to arrange financing as long as that 50 per cent direction clause was in the Mineral Processing Act. I don't think that is the type of legislation which will encourage mining development, and I'm certain we will have to have a look at it in the future.

MR. KING: Very briefly, I am intrigued by the minister's statement that the mining industry needs a predictable climate. I want to say, Mr. Chairman, that there could be no more predictable climate for any industry or any individual in the province than to allow them to write their own ticket with respect to taxation laws and so on. If that's the justification the minister is putting forward for involving people in finding tax legislation over the mines of the province of British Columbia who are privy to major developers, then I say it's a sorry day for the people of British Columbia. However, that's an observation, Mr. Chairman.

I want to elicit from the minister some more precise information in what he gave. Perhaps I didn't frame my question well enough at the outset. The real thing I'm looking for in terms of the Department of Mines administration of blasting certificates is to learn the precise criteria under which these certificates are revoked, rescinded or suspended. I can well appreciate that there are circumstances where this kind of action must be taken. But I am equally concerned, Mr. Chairman, that on those occasions there be a framework for a proper hearing to ensure that when the serious step is taken of in effect removing one's right to a certificate to practise a vocation and earn a livelihood, there is indeed justification for such a move, and, more importantly, that there be a framework and a mechanism for a proper appeal. Is the practice by the Department of Mines to arbitrarily revoke some poor individual's licence and say: "You're banished for all time, on the basis of my arbitrary appraisal of your conduct, of your criminal record, of your proficiency, of your mental stability"?

I say those are rather threatening and rather dangerous prerogatives to hold in the hands even of that innocent-looking little minister, Mr. Chairman. I think that they are extremely dangerous powers unless there is a mechanism for review and a mechanism for fair hearing and representation on the part of the individual involved. That's the kind of assurance I'm looking for from the minister.

HON. MR. WATERLAND: Mr. Chairman, in response to the question from the member from Revelstoke-Slocan, the, procedure right now in issuing of blasting certificates, as was outlined by the member for North Vancouver-Capilano (Mr. Gibson), is that the person must have a demonstrated competency to blast to receive what we call a permanent blasting certificate; a provisional blasting certificate can be issued by the management of a mine once they have satisfied themselves that the person is competent to blast. That certificate is restricted to that particular mining operation.

As I said also, there's no formal training programme, but the mines inspectors do conduct examinations in proficiency. I have been involved myself in suspending people's blasting certificates, and it's a thing I never did lightly. There's one case in particular — and perhaps the member from Revelstoke-Slocan is aware of it — and that was a situation in the Craigmont mine in Merritt where a gentleman was involved in a train accident. During an arbitration hearing over the action taken against him, it was noted in the hearings that this person was of a panicky nature and tended to get excited. In fact, this evidence came forth from the union that was representing him. When I heard this, I did suspend

[ Page 3023 ]

that person's blasting certificate, because I didn't want a panicky, nervous, excitable person blasting. I said to him that his certificate would be suspended until such time that he could bring the evidence from a medical practitioner that he is emotionally stable enough to conduct blasting operations.

I think I must agree with the member that although at the present time there is not a review procedure and there has never been in the Mines Regulation Act, perhaps a review procedure would be in order. Anybody can be wrong. If the certificate is wrongfully suspended it does affect that person's ability to earn an income, and I think I would be in favour of such review procedures.

MR. KING: Mr. Chairman, I appreciate the minister's comment and I hope he will look seriously into setting up a framework where there is a common law requirement of redress and appeal open to the individual. What really bothers me is the right of any government bureaucrat to make arbitrary assessments of an individual's psychological stability. The minister talks about a person in his riding who was panicky. I don't know if that's a particular characteristic of people from up in that area, but I hope that the Premier doesn't start passing judgment on his ministers on the basis of whether or not they're panicky, because the Minister of Mines might find himself out of a job, too. He may lose his certificate, Mr. Chairman.

I do want to thank the minister for indicating that he will look into this. I'm sure he and his good friend and seatmate, the legal chap from Kamloops (Hon. Mr. Mair), would agree that every department that holds a regulatory authority of this nature should provide an open and a fair mechanism for appeal on an understandable criterion of application. Otherwise, the way is left open to abuse and to discrimination on a variety of grounds. Justice has to be seen to be done as well as be done.

MR. L. NICOLSON (Nelson-Creston): Mr. Chairman, the concern that I have is one which results from an amendment, I believe, to the Mines Regulation Act whereby reclamation permits were also required for gravel operations. I would like to bring to the minister's attention a loophole that is certainly causing a great deal of distress in my riding. I have a copy of a letter to the chief inspector of mines from a Mr. Norman Thyer re the permit authorizing surface work, sand and gravel pit No. G-101, issued on February 19, 1974, to Mr. Henry Zukowski of 507 First Street, Nelson, B.C. I guess that was fairly soon after the regulation was enacted.

It was issued to him, Mr. Thyer contends, and this gravel pit, I would imagine, would be near the Sproule Creek Road, just a little bit out of Nelson. It appears that there was a failure to follow.... He says:

"Dear Sir:

"It appears there was a failure to follow the correct procedure as classified in section 11 of the Mines Regulation Act when the above permit was issued. In particular, regarding section 11(4), it appears there was no notice published in the Gazette or any local newspaper, and I was denied my right to make representations as provided for under section 11(5).

"In view of this, I request that this permit be set aside immediately and that I should be allowed adequate opportunity to present my objections before the suspension is lifted."

The letter is dated June 18, 1976, and it is not that I am saying he hasn't had a response yet. He's sent copies to myself and to the minister, but it was directed to the chief inspector of mines.

I would like to add to this, though, Mr. Chairman, that this very same individual, Mr. Zukowski, appears to be exploiting a loophole — and I've discussed this with the local mines inspector — in the Act, and that is that he is transporting prodigious amounts of gravel from a piece of land which he's not legally operating as a gravel pit. First of all he started to remove some of the overburden, and it was used as land fill which he, I believe, gave to the city of Nelson as part of their waterfront land reclamation project. He might or might not have been reimbursed for the truck traffic and for the transportation. I don't know about that.

What I do know is that he is now using the material as part of operations of another housing development which he is building within the city limits. Now this second site is on Johnston Road, directly across from the city of Nelson, and it's fairly densely populated urban residential area, or a developing urban area, if you would. It's in the unorganized area, of course, of the regional district of Central Kootenay, but it appears that since money is not being paid and the gravel is not actually being sold, it doesn't fall into the regulations.

To point out the seriousness of this, I've looked at the site — I regret I didn't have my Polaroid camera with me the day I was up there — but I would estimate that excavations have taken place nearly to the border of a very nice home, right up to the property boundary, and there must be a good 30-foot drop-off created. The landscape...while I'm not an engineer, I could say that future use of the land is almost prohibited.

[Mr. Rogers in the chair.]

So on the one side it has encroached upon a person's property, their home, and I'm sure they moved there feeling that they had some sort of

[ Page 3024 ]

security. In fact, they feel: "Well, can't government protect us? There must be something we can do."

I started trying to find something to do. I first became aware of this problem actually during the last provincial election. We tried, and the local inspector of mines attempted, but the legislation falls short. It is something that either the minister, who I think is the most directly charged at present, or the Minister of Environment (Hon. Mr. Nielsen) have got to address themselves to, because once a loophole like this is discovered, it gets bantered about and there could be a terrific proliferation of it throughout the province, much to the dismay of people who will one day find next to them a gravel pit through lack of action, perhaps, towards proper zoning and protection of property rights through regional districts.

I think that the provincial government level has some responsibility in this area. I certainly would have sought to have some input into some legislation, and that's what I'm attempting to do here today during the minister's estimates.

I would go further and point out that on the back boundary of this property — I don't know if it's the boundary of the property — there is an easement for West Kootenay Power and Light, and it's also up very close to the power line. If it were extended, I would say that a slump could actually cause that power line to come down, but because there's no way of controlling this type of excavation, it's rather difficult.

I might bring up another point, too, in passing, and a concern in the area of the Reeves Macdonald mine which was recently closed down. I would like to know if the reclamation work is taking place. I would be particularly concerned about a vent hole which exists, I am told. A hunter or someone might wander on to that property, children or others, and could actually fall into it if it's not properly sealed off. The last time I checked, certainly nothing had been done in that area. I would like to be assured that the Act is being carried out.

I don't think it preclude the opening of that mine if they should find that the Red Bird ore property is worth exploring, or something at some future date. I understand they've sealed things off internally so pumping operations would be facilitated to get into some of the prospective ore properties adjacent to the Reeves Macdonald property. Is reclamation taking place, and particularly what I understand to be a large open vent hole?

HON. MR. WATERLAND: Yes, the letter you referred to, to the chief inspector...I forget the name of the person who wrote it, but I did receive a copy of that, and I immediately contacted the chief inspector asking him to be sure that the matter was looked into. There are, of course, ways of getting around most laws, and as time goes on we gradually get the loopholes filled in.

A circumstance where somebody is taking gravel from one place to another, and calling it a residential housing development, or where the fill is going into the development — it's one of these borderline things which I think is quite difficult to enforce. However, we are looking into it and when I get an answer I'll be very happy to report back to that member.

So far as the Remac or the Reeves Macdonald mine is concerned, there is a possibility this mine may reopen. In the meantime the company does have a watchman at the site all the time, and I understand that the areas which provide access to the various openings through the surface are barricaded up. Whether they're adequately done I don't know; I haven't seen the property. The mine is permanently closed, and of course, all the reclamation work must take place.

That member is familiar with the Salmo operations of Canex Placer which shut down a year or so ago. I personally at that time was doing some work in the area and all the mine openings were safely closed off and reclamation work started at that time before I left — I haven't been back since. But this type of thing is done and you can be assured that that mine will not be reopened and all the openings will be permanently closed off so as not to create a hazard to the public.

MS. K.E. SANFORD (Comox): Last time we were discussing this minister's estimates, there was a good deal of reference made to the people who were involved in drawing up the legislation for this minister, and, as you recall, the sittings at that time became quite heated.

But I would like to make the comment, Mr. Chairman, that it's quite obvious that those who were drawing up the mining legislation — and I would assume that this is under the direction and the guidance of the minister himself — were going to have that legislation for the benefit of the mining industry, largely foreign-owned and certainly not for the benefit of the people of this province. I think it's shameful that our ore, which belongs to everybody, is again going to be given away free of charge — "Help yourselves, mining companies."

I think it's unfortunate that a tradition which has been established for a long time, a principle that has applied for a long time in the forest industry — that is, stumpage rates, paying something for the resource you're getting — is being eliminated under the direction and guidance of that minister. I think my point with respect to this giveaway is that made by a couple of headlines in a local paper, the Campbell River paper, very recently — one on top of the other, and which illustrates very well the point I'm trying to make here this afternoon.

[ Page 3025 ]

The first headline says: "Mining Firms Very Happy With Socreds." The second headline, right underneath it, Mr. Chairman, says: "Ferry Fares Up, Traffic Down." The article underneath the second headline starts out by saying:

"The Shoreline Motel on the Island Highway South of Campbell River has been flying its flag at half mast during the past week to mourn the drop in tourist traffic since the ferry fare increase went into effect at the first of this month."

So there you have the two headlines. Both of these are directly related to the attitude and the approach that this government takes. Let's give it away again to the mining companies and let's sock it to the people.

Mr. Chairman, time and time again in this House after the government has brought in measures such as doubling, tripling ICBC rates, 40 per cent increase in sales tax.... You know the list. We've heard it many times in here. When they have done all those things and then doubled the ferry rates...

MR. D.F. LOCKSTEAD (Mackenzie): Tripled in some cases.

MS.SANFORD: ...tripled in some cases, as my colleague from Mackenzie states....

MR. CHAIRMAN: Hon. Member, we are on the Minister of Mines.

MS. SANFORD: Yes, and this is directly related, Mr. Chairman. You don't recognize that this is directly related.

When we have gone through all those changes and then have a doubling and a tripling of the ferry rates, and the government over there is busy giving away the ore under the direction of that minister — when that happens, those of us on this side say: now that you have made all of these changes, the least you can do is to conduct an impact study on what is happening to the people that are affected in these areas.

I've asked at least twice in this House if the government will conduct some kind of impact studies to see what is happening as the result of their policies. Every time the answer has been a flat "no." "No", says the Premier, "we won't look in to find out why this businessman is flying his flag at half mast. We're not going to worry about what effect an $80 return trip for a car and driver to Vancouver is from places like Alert Bay and Sointula. We're not going to worry about that. We're not going to study that." When it comes to the mining industry and the approach that that minister takes to the ore in this province, that is a different matter. We certainly will treat them quite differently than we treat the people of the province.

This industry is largely foreign-owned, and this is the industry that campaigned vigorously against the previous government and is now getting its rewards. "Mining Firms Very Happy With Socreds" — Sure they are.

Why doesn't that minister, Mr. Chairman, ask the motel operator in Campbell River who is flying his flag at half mast these days what he thinks about giving the ore away in the province? Why doesn't he ask that person who is now forced to pay $80 for his car and the driver to get to Vancouver from northern Vancouver Island? Why doesn't he find out from them what they think about giving the ore away? Why doesn't he ask the teacher and her students in the Courtenay area who had worked for an entire year to raise enough money to take a ferry trip to Vancouver during June, and then they find at the last minute that the rates have been doubled and they have only half enough money to pay for their fare across there? Why doesn't he ask them what they think about giving the ore away?

We brought that to the attention of the Minister of Transport and Communications (Hon. Mr. Davis) and said, "Look, these kids have worked all year to raise enough money to give them this trip to Vancouver. Will you give them special consideration just once?" "No," said the Minister of Transport. But the mining industry gets special consideration. They get a fine deal in this province.

Mr. Chairman, the mining industry last year in this province was in trouble, as was the forest industry, as were a lot of other businesses, because last year was not a good year economically anywhere in B.C., in Alberta, in the rest of Canada, or in North America, or in many other parts of the world. No one denies that.

When the price of copper plummets down, because copper is one of the major ores that is produced in this province, the mining industry is going to be in trouble. There's no doubt that they had difficulties last year. But at the same time, it was rather convenient for the mining industry to have the prices drop last year, because it gave ' them an ideal opportunity to yell about having to pay a mineral royalty. They yelled lots. They yelled during the campaign. They yelled before the campaign. They cried the blues everywhere.

Mr. Chairman, I do support the mining industry in this. They contend that it is unfair for the federal government not to allow them to count the payment of mineral royalties as an expense. The federal government, as you know, made changes on this and requires them to pay tax on their mineral royalties. I agree with them on that, but a royalty in this province is a legitimate business expense.

They are paying for something they are receiving from the people of the province, and it should be there; it should remain. But it was convenient for them last year because they were able to get the

[ Page 3026 ]

sympathy of a lot of people because they were in trouble financially, all over.

Mr. Chairman, when that mineral royalty legislation was initially introduced by the previous government, there were some very interesting comments that came out from the mining companies. I think the Minister of Mines should be informed about these comments, or at least should be reminded of them if he already knows about them.

The mining companies sent out a handbill asking for a meeting — the British Columbia and Yukon Chamber of Mines. They talked about the mineral royalties bill, and these are some of the comments they made about the bill after it was introduced by the previous government. You know what they called the government? A bunch of crooks. Not very parliamentary, Mr. Chairman — a bunch of crooks. One of the things they said at that time I would like to quote and read into the record: "These people — referring to the government — "want to destroy us, destroy our way of life. They want to install an eastern European type of Socialism." Then they said: "Let's counter-attack so they will know who runs this province." Now I ask you — "the government will know who runs this province"! Now that this bunch is back in, we know who's running the province again. We know.

MR. KING: Dan Campbell.

MS. SANFORD: Right, Dan Campbell. I don't disagree with you.

MR. G.S. WALLACE (Oak Bay): Do you know Dan?

MS. SANFORD: I've heard of him. Yes, I've heard of him, Mr. Member for Oak Bay.

But, you know, the attitude of this government and this minister is really very similar to that held by the previous government and, I think, one P.A. Gaglardi, a cabinet minister in the former government and, yes, an MLA for Kamloops. I'm sure that scares you, Mr. Minister of Consumer Services (Hon. Mr. Mair) to realize that he was once representative for your area.

Mr. Gaglardi expressed the philosophy of the former government, this government and this minister by the comments he made some years ago. This is what Gaglardi said: "God put the coal there for our use, so let's dig it up. Never mind the pollution that will come from Kaiser coal mine." Then he later said: "Greed was given to us by God, and without that greed, there is no progress, no incentive to build a better Canada." Without that greed! We are encouraging that greed by the approach taken by the minister to his department, Mr. Chairman.

So what is he suggesting instead? "Oh, we're going to tax their profits," he says. "We're going to tax their profits." But the federal tax policies, as most people recognize in this country, are generally designed to provide welfare for the undeserving. And if you look at the various tax concessions, loopholes, escape routes and depletion allowances that the companies have had over the years under the federal tax structure, then you begin to question what kind of money the companies are going to pay under the policies of this particular minister.

Let's look at some examples of the kind of payments made by companies under the federal tax policies. In 1969 — and this goes back a few years, I recognize — 87 per cent of the 268 metal mining companies paid no income tax. None. Eighty-seven per cent of the 268 that were operating in this country. Now I ask you, Mr. Chairman: what kind of a tax policy is that? These companies are doing fine. Western Mines in my own constituency — and this is in 1973 — earned a profit of over $5 million. Do you know how much they paid in taxes, Mr. Chairman? I think this will surprise you — not one cent.

Interjection.

MS. SANFORD: Not one cent to the people of the province who own that ore, and not one cent to the federal government in tax, Mr. Member.

MR. CHAIRMAN: Order, please! The hon. member for Comox has the floor.

MS. SANFORD: Mr. Chairman, I tried to find out what the other mine in my constituency makes, what kind of profits are made there. At least Western Mines publishes quarterly reports and gives you some inkling of what's going on. So I wrote to the other mine within my riding, and I think, Mr. Minister, this is something that should concern you.

I wrote to Utah Mines, the Island copper mine up in Port Hardy, and asked them for a copy of their annual report, because for some reason or another they had not put me on their mailing list. I received the following letter which, Mr. Minister, I think should really concern you.

"Utah Mines Ltd. is a wholly-owned subsidiary of Utah International Corp. and as such does not publish quarterly or year-end reports. The parent company reports are not relevant and will only contain comments on the Island copper mines, as the data is commingled with other Utah ventures." Well now, isn't that interesting? So we don't even know what kind of profits they're making or what kind of taxes they're not paying, Mr. Chairman.

The philosophy of the federal government, as far as this tax policy is concerned for mining companies and for most industries, is that you sweeten the pot

[ Page 3027 ]

at the top a bit and then maybe there'll be some money that trickles down somehow to those people who are in the low-income brackets or living below the poverty line. David Lewis, at the federal level, has time and time again referred to this particular philosophy which has been promoted by right-wing groups, whether they be Liberal, Conservative, Social Credit or coalition, as this is.

The issue of taxing and tax loopholes, as expressed by David Lewis in a book that he wrote called Louder Voices, is: "By what means do before-tax profits of $1.13 billion in the mining and petroleum industries" — which he was referring to at that time, and I am talking about before-tax profits of $1.13 billion — "shrink to a taxable income of $136 million?" Mr. Lewis aptly notes that the touch of metamorphosis is well beyond the ordinary taxpayer. There is no way that he can suddenly shrink his taxable income in the same way that mining and petroleum and other industries can. Just try it if you are an ordinary taxpayer. You can't do it.

So this business of taxing profits is something that I am very sceptical about, and I am certain that the return to the people of the province for their ore will be less than it was under the previous government — the previous Social Credit government.

Interjection.

MS. SANFORD: It is unfortunate when people are forced to pay the kind of increases that this government is making them pay. Western Mines, within my own riding, prepared brochures for the tourists who they took through their mines, conducted tours, and those brochures cried the blues and indicated to tourists who are coming through that "Oh, the B.C. mineral royalties were doing us in." They didn't mention anything about copper prices or anything of that nature.

But do you know what was happening at the same time that these brochures were being handed out to tourists coming through the mine, crying the blues about their profitability, that they might even lose money, that they had to lay off 75 guys up there because things were so tough?

Do you know what was happening at the same time, Mr. Chairman? Brascan was wanting to buy the mine. Brascan! They were negotiating. They were fighting for the controlling interest of Western Mines while all this crying was going on about mineral royalties introduced by the previous government. What a laugh! Mr. Chairman, Brascan does not buy into a mine unless it thinks it can make a profit. Based on the stories that Western Mines was telling our constituency and telling the province, that they were in deep trouble financially, certainly no one would want to buy that mine. Brascan is not operating in Brazil out of a love for the peasants there.

AN HON. MEMBER: How do you know?

MS. SANFORD: They're operating for the profits, and all you have to do, Mr. Member for Omineca (Mr. Kempf), is read something about that company and you'll recognize that they are not operating there because they're concerned about the residents or the peasants of....

MR. F.A. CALDER (Atlin): What's wrong with profits?

MS. SANFORD: Mr. Chairman, I'm not going to respond to that particular comment.

Interjection.

MR. CHAIRMAN: Order, please. The hon. member for Comox has the floor.

MS. SANFORD: You know, now that we have this coalition and that particular Minister of Mines (Hon. Mr Waterland), I expect that the mining companies are happy, but I know that the people are very unhappy. I know that the people within my constituency do not like to see the ore given away again by that Minister of Mines while they're facing the kind of increases that they've had to face within the last six months.

But there's no doubt that this headline, Mr. Minister of Mines, is accurate: "Mining Firms Very Happy With Socreds." Thank you, Mr. Chairman.

MR. LOCKSTEAD: Mr. Chairman, I have a few questions for the minister. Perhaps when he rises in his place to reply to the hon. member for Comox he will reply to some of these questions as well. I am particularly concerned about a mine in my riding known as Texada Mines, an iron-ore property located on Texada Island. This mine is a wholly-owned operation — wholly owned by the Kaiser people in the United States, based in San Francisco.

Interjection.

MR. LOCKSTEAD: Yes, I'm not sure, but this is certainly a wholly-owned Kaiser property, Mr. Minister.

Anyway, it is well known. I think your deputy is reasonably familiar with this case, and I hope you will be as well. This mine will be shutting down in the near future. I would like to know, Mr. Minister, if you are aware of exactly when this mine may be shutting down.

Now there is no question that if and when this mine does shut down — it is my understanding that it

[ Page 3028 ]

will be this year — first of all, it will have a tremendous impact on the community which it serves and in which it is located. There are people working in that operation; we don't know what is going to happen to many of those people. How are they going to be relocated if the mine does shut down?

But I would like to know if that mine has been worked in the best possible way. I haven't been down into that mine for some time and, of course, there is no way for me to know, but I understand, according to some employees, that a certain amount of high-grading has taken place — so-called high-grading. That is, mineable ore was left in the ground because of declining world markets and prices.

I know that your department would likely have some information on this. I would be very interested in hearing from you, Mr. Minister, if that mine was mined in the best possible way. I would like to know as well if on that particular property there are still copper bodies that perhaps should be mined, or could be mined, prior to the mine shutting down. Does that company have any intentions of working the copper values on that property?

Interjection.

MR. LOCKSTEAD: An interjection from the member for Columbia River.

I wonder if the minister could as well tell this House how much profit the Kaiser people have taken out of this country. How much money have they actually taken out of this country that should have perhaps stayed here for redevelopment? How much? What was the profit that was taken out of this province and out of this country, Mr. Minister?

MR. CHAIRMAN: Would the hon. member kindly address the Chair?

MR. LOCKSTEAD: Yes, Mr. Chairman.

Finally, Mr. Minister, I would be very interested in knowing from you if any impact studies are being contemplated for Texada Island and that regional area, because there will be a huge impact on that area when that mine does finally shut down.

HON. MR. WATERLAND: Mr. Chairman, I was going to reply to some of the questions asked by the member for Comox (Ms. Sanford) but she doesn't seem to be here any longer. I guess she wasn't interested. However, I will make a few remarks about her remarks.

Foreign ownership: she referred several times to this large foreign-owned mining industry in British Columbia. Members opposite, I know, have the Price Waterhouse report because they have referred to it on many occasions. The 1974 report, which was the last one issued, indicates that in British Columbia in 1974 the mining industry shares were 56 per cent owned by Canadians, which was down 2 per cent from what it was in 1973.

As far as the value of shares owned in the mining industry in British Columbia, in 1973 it was 64 per cent — that's the value of the shares owned. So the mining industry in British Columbia is not owned — not even majority-owned — by foreign investment. However, we do need foreign investment to help develop the mines because it is a tremendously expensive undertaking. I would like to see more Canadian participation, and I believe that through federal government incentives perhaps some day British Columbians and Canadians will have more incentive to actually get involved in their own industry. I don't think we can encourage Canadians to invest in this industry by discouraging foreigners. I think we should have a little bit of a tax advantage as individuals if we invest in a high-risk industry such as mining.

The member also referred to the ripoff and the tremendous profits made by mining companies. She said that the reason that mining companies didn't come out in British Columbia in the last few years and develop more mines is because we had low metal prices. But in the last few years, Mr. Chairman, we have had the highest copper prices in history — still no mines were developed in British Columbia.

I am not saying this because it is a politically motivated thing, but I feel very strongly that an off-the-top royalty will discourage mining, and I think this has been demonstrated.

For example, I have some figures here which I copied down several months ago. They're for the first six months of last year. Gibraltar Mines, for example, had a gross operating profit in the first six months last year of $584,000, and they paid taxes of $980,000. That's a pretty high tax rate.

Noranda Mines, for the first six months last year, had an operating profit of $686,000 and they paid taxes of $775,000. Bethlehem Copper: their mining income for the first six months of last year was $560,000 — which is very, very low considering the cashflow at that property — $560,000 mining profit, B.C. royalties and taxes $639,000 and federal income tax $121,000. Even though they had an operating profit, they wound up losing over $200,000 after taxes. These are figures from their annual reports and audited statements.

Granduc, in that same period of time, had taxes and royalties of $451,000 in spite of a total loss, including those taxes, of $850,000.

We really do need investment in British Columbia mining if we are going to develop the people's resource. I don't think you can properly compare mining royalties to stumpage on timber. The, royalty that is paid by mining companies is the tremendous cost of exploring for and finding the mineral deposits

[ Page 3029 ]

and the much higher risk nature of that industry. In the forestry industry it is to a certain extent high risk, but at least you can go out and feel a tree and touch it and say: "This is a tree and that's why I'm buying from the government." In mining, a great deal of money is spent before that resource is ever found and developed, and I think we must recognize that.

As far as Texada Mines is concerned, the member for Mackenzie (Mr. Lockstead), I realize the ore deposit there is being depleted. Our department has been talking with Texada about just what ore reserves they have left, and this change in mining taxation which is coming up now will favourably affect the life of that mine. As you know, ore is defined as that mineral commodity which can be economically extracted, and if you have a royalty on top of the cost of extracting that ore, it adds to the cost and makes material that was ore into waste. By removing the royalty and going to a profit-based tax, the mine will last longer — how long, I don't know.

The Department of Mines is not involved in plans for what happens for the future of the community there. I hope there will be other mines coming on stream which will at least replace the jobs which will be lost when that mine shuts down, and, believe me, every mine operating in this province will someday shut down. I have personally lived in five different communities which were dependent upon a mine, and these five communities all were abandoned when the mine closed down, because it was the only reason for them being there. In all cases there are other mines to go to for the people employed there.

I don't think we can say that when an ore deposit is depleted the mining company must continue mining a waste rock. That is complete unrealistic and would require a subsidy from the government. I think it is much better that they are involved in economically viable ventures, because so long as we have the proper climate, new mines will come to replace those that close down.

We are continuing to study the Texada situation, as far as I know. As a matter of fact, I have a report in my office regarding the mining method used and the recovery of the ore that has been carried out. I haven't had a chance to study it in detail, but the opinion of the engineers who did was that the mine is doing a reasonably good job under the conditions which they have to mine all possible ore.

That member for Mackenzie mentioned also that some high-grading went on.

Interjection.

HON. MR. WATERLAND: He said it was reported that some high-grading was going on. Well, high-grading is a hard thing to define. As metal prices go down, in order to profitably extract ore you must go to higher grade material, and this is done....

Interjection.

HON. MR. WATERLAND: Well, it did to a certain extent. In fact, royalties, especially with our large core-free deposits which generally consist of the higher-grade core and the marginal material on the edge of it...adding the cost of the royalty to the cost of extracting that low-grade ore in many cases made it unprofitable. However, mining companies who have surface mined generally stockpile this material in hopes that at a time when metal prices are high they will then be able to run that material through the mill, because at that time the only cost is really picking it up again and putting it through the mill. They do their best to extract all possible value from the rock.

High-grading is a term that, well, comes down through history. I was thinking of the fellow in the high-grade gold mine taking a chunk and putting it in his lunch bucket and taking it home. That type of high-grading is really not done in the large, sophisticated mining industry of today. When prices are low, higher-grade materials have to be mined, and when prices are higher, then the lower-grade material can be mined. Mining companies want to extract every possible bit of value from their ore bodies, and I am sure this is the plan of Texada Mines.

MR. LOCKSTEAD: Just a very brief remark. In regard to the study that the minister has on his desk, I wonder if it would be possible to look at that, through his office, because the impact of this mine shutting down in that area, Mr. Minister, is going to be very severe. I appreciate some of your answers, a large part of which were quite political and made no reference to my questions whatsoever. But just the same, I would be very interested in having a look at that study.

HON. MR. WATERLAND: Yes, to the member for Mackenzie, by all means, if you would like to come to my office some time, my executive assistant, Bill Fothergill, the son of the advertising fellow, is a mining engineer and he can get that report for you and explain it to you in detail, if you wish.

MR. KING: Mr. Chairman, I appreciate the minister's cooperation. I'm very familiar with his executive assistant — he's another Revelstoke boy who made good. I just trust that when the member for Mackenzie shows up at the minister's office he's not confronted with some new mining slogans. In any event, I think the information would be welcome.

Mr. Chairman, I just wanted to make a few remarks — I'm certainly no expert in mining, though I have worked in a mine on one occasion. I have in my riding quite a number of mining properties and there is a lot of prospecting that goes on in the south part

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of the riding. There's also the imminent operating and coming into production of a mine at 54 Mile, north of Revelstoke — the Goldstream area. We had King Resources operating in close proximity to Revelstoke for the last few years — it's now shut down and the company has moved out.

AN HON. MEMBER: Are you the president?

MR. KING: No, it was a Texas firm — no relation.

So we've had quite a number of mines over the years. I'm interested in the minister's appraisal, his rationale, for the administration of the Mine department in the province. I think we on this side of the House understand and agree that there has to be a reasonable margin of profitability in mining endeavours. We understand that it is a high-risk industry in many ways — not to the extent that it used to be by any means because of the new technology that the minister himself talks about. So the risk is certainly not like it used to be in the days of the old prospector going out, being grubstaked and searching for years to find a property that was worth something, then all of the expensive testing to determine whether a sufficient-sized ore body resided under the surface to warrant development. They have more sophisticated ways of finding adequate ore bodies to bring into production.

If we accept the minister's approach, which is basically that there should be a minimum of, or very little, government intervention in the mining industry as far as taxes and royalties are concerned, one of the things that interests me is: what profit do we as a people, what profit should the public of the province of British Columbia expect from a resource which is a one-shot resource, which is irreplaceable? I believe the minister did make the statement, up in his own riding at one point, that copper ore was replaceable. I wasn't aware that we had that new kind of technology yet, and perhaps the minister could expand on that statement at some point of time. But I was never aware that ore was replaceable.

It seems to me that the public has a right to expect not only a fair return to the public treasury, but they should have a right to expect some social benefit as well — such as employment and such as some kind of protection for the investment the community places in mining development. The minister has admitted being involved in a variety of mining endeavours which eventually were abandoned and the community closed so the people had to scatter and find new employment. Now there is a social cost involved in that kind of exercise, and that's gone on since time immemorial. That has gone on through history and is still going on.

You know, it doesn't happen in a vacuum where only the mining company is affected; there's a cost investment by the public, and a loss to the public when that mining operation finds it is no longer profitable to operate and moves on. There's the cost of providing school facilities in many cases — health and hospital care, recreation, housing — a whole variety of things which have a public investment in them.

I think what we're concerned with, and what the public is concerned with, is some reasonable balance of the responsibility. Certainly it's my view that when the company has profited from our resource for many years, when there has been an infusion of public funds to support their operation, as there inevitably is — both with respect to the facilities I've talked about and of roads and so on — then surely that mining company has some obligation to offset the economic and social impact that accrues when they fold their tent and steal away. I think that's a reasonable proposition and one that should be looked at seriously in terms of the balance of social responsibility between the community and the private company.

The other question that the minister has not talked about is one that I think must be viewed intelligently, regardless of political philosophy, if we are to find a happy balance between the exploitation of any resource and the benefit to the public. Because there are those people in society today and in politics — many of them — who take the position that perhaps at a given point in our history, due perhaps to world markets and world supply, it would be more intelligent to let the resource lie undeveloped for the future than to exploit it now simply because we know it's there. And in terms of making that kind of decision, surely we have to know what the social advantage of development would be.

I think it's essential, Mr. Chairman, that the overall employment opportunity accruing from mining development be reappraised, because I'm familiar with a survey that was done in the mining industry in 1969 which covered the preceding 10-year period and analysed what had happened to the jobs related to the mining industry in this province. I want to tell you that it wasn't the government that did that survey. It should have been but it was not. It was not the industry; rather it was the trade union involved in the mining industry. They could see the shrinkage of their membership and they realized that, although production and mining activity was rising, employment opportunity and consequently the membership in the trade union was shrinking.

That's understandable quite easily because technology is changing rapidly. We have new methods of mining today — huge machines that strip mountains, machines that can accomplish the work that used to require the strong backs and muscles of thousands of workers. I think we have a right to know in terms of framing policy, and I think the minister should demand to know what is happening

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to employment. What is the real balance of social benefit derived from mining? That's the kind of information we must have before an intelligent policy direction can be undertaken and certainly any intelligent debate on the subject.

Now the minister gets up and says: "I have great sympathy for the mines and I think they have to be relieved of off-the-top royalties." That's fine. I don't know what he supports that upon, simply because he was associated and worked for the mining industry, whether it's an euphemistic kinship he has or whether it's an intelligently based appraisal of what's going on in that industry. Conversely the critics on this side of the House see that that's a pretty ineffective way of sound policy appraisal in mining.

We argue on this side of the House that it's unrealistic and ineffective to impose a net profit tax in the mining industry. We believe that in a corporation as complex as mining corporations usually are, with a variety of interrelated corporations provided with depletion allowances, provided with vast capital investment which can be written off in terms of depreciation to an extent, that is usually not available in any other kind of industry, we see devices, at least on the surface, for the write-off of virtually all profits, which means that the tax is applicable to an unrealistic profit at the end of their accounting year. So we feel that's an unrealistic way of assessing the tax in the mining industry.

Conversely, the minister argues that a royalty payment off the top is unrealistically prohibitive and curtails mining incentive. Now I'm suggesting, Mr. Chairman, that we have to have more information. I regret that the Department of Mines has not kept a more up-to-date record. In fact, as far as I can determine, it has not even showed any particular interest in measuring the employment opportunity that is available in the mining industry today.

What has happened to it in terms of growth or the fall in employment opportunity? What is the social cost of mining towns that operate for 10 or 20 years and then close down? What is the social cost imposed upon the people of British Columbia by losing expensive facilities that we have brought in to support their operation? What is the social cost in terms of the transfer, relocation, mobility costs to workers which the federal and provincial government provide? What is the retraining cost if there is no other alternative than employment available in the mining industry? What are the retraining costs?

Before we can have an intelligent mining policy in this province and before we can really monitor what is fair in terms of a royalty upon the mining industry, it seems to me these are the things we should know and these are the things that the Department of Mines should be presenting to this House so we have some data base upon which to determine what is fair, what is equitable. Without getting into a highly partisan political debate as to whether or not we want to kill the mining industry, we could debate intelligently what a fair and equitable taxation policy or royalty policy is. I think the minister would be well advised to try to go down this road in terms of future discussions in this House.

The minister talks about royalties being unrealistic. I don't know — if we looked at a particular operation and concluded that there's no employment benefit there, and if his new taxation policy is so low as to virtually contribute nothing to the public treasury, what is the point of having the operation come into production at all? Why not leave it until economic circumstances on world markets, new technology, and new and more intelligent generations find a more profitable and equitable exploitation from a social viewpoint and from a profitability viewpoint? That is what we are talking about and I think that is the intelligent approach.

Rather than having any of the statistics upon which to formulate this kind of policy, we have rhetorical arguments regarding the political posture of the different parties. It's really meaningless. I would hope that the minister would try to present something more tangible to support his approach to mining: the elimination of royalties. I would hope that next year when his estimates are before this House for consideration he will be prepared to come in and say: "Now look, the taxation level which I and the mining industry formulated last year is reasonable because here is what it contributed to the province." I don't mean only taxes. What did it contribute to employment? What did it require in terms of public funds as support for that industry? That is an equation that must be looked at. It must be balanced, and we must have an accounting of whether or not, from a social viewpoint, it is prudent for us to go ahead now. These are the kinds of things we have to look at.

Finally, I want to say, in terms of the debate regarding royalties as opposed to taxation, that I think I have given an indication that it is very difficult for the public or the politicians to make that kind of appraisal without these facts, but I do want to point out in conclusion, Mr. Chairman, that we are dealing with a resource in terms of minerals which does indeed fluctuate wildly on world markets as demand rises and falls, usually related to conflicts around the world rather than some productive purpose, unfortunately. We must remember that in this particular area we are dealing with a one-shot resource that, once exploited, is in no way available for recapture. Not only that, but digging out that resource and exploiting it is a high-risk industry, not only in terms of financial input but in terms of damage to the environment.

We have a whole variety of considerations that should go into the formulation of an intelligent

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mining policy. We should be thinking, when we discuss royalties as opposed to taxation, whether or not there is a great degree of pollution of the air involved, and whether or not clear streams might be destroyed. I want to say, Mr. Chairman, that one of the most important resources in this nation and in the world today — and one that is also virtually irreplaceable — is fresh water. I do not think we can any longer tolerate the kind of industrial development, be it in the mining industry or elsewhere, that runs rampant over and destroys freshwater streams and lakes.

We must weigh all of these things and we must always be conscious of the fact that many of the ingredients that go into mining can, if not wisely pursued and initiated, be a one-shot kind of situation which destroys that resource and mars the landscape and the quality of life and the environment for all time. Before we are going to become wildly enthusiastic about the minister's approach, regardless of how sincere it may be — and I think it is perhaps sincere, but somewhat naive, because sometimes you have to stand back and take a look — I think that we will want to have a whole lot more information. We will want to have assurance that not only the interests of profitability for the corporation are being protected and looked at, but the whole quality of life and the whole protection of the public are going to be a factor and a basic ingredient in terms of setting our policy and charting our course for mining in British Columbia for the future.

MR. GIBSON: Mr. Chairman, this debate has been flowing back and forth over a great many subjects. I hope you won't mind if I go back to some of the earlier topics.

The minister in responding to the remarks I made about the desirability of direct provincial incentive for getting into undersea mining, one way or another, stood up and gave an appreciation of some of the difficulties of undersea mining. I was glad to see that he thought it was going to be the coming thing. He thought the technology wasn't there right now.

Mr. Chairman, I appreciate those difficulties. The only point I want to make is that it's essential that British Columbia get in on the ground floor, and that may require some direct government encouragement, whether simply moral encouragement or perhaps actual financial encouragement as well.

Now the minister, in commenting on some of the rate-of-return difficulties that I saw in the mining industry, mentioned a speech that had been made in the early '50s about the imminent demise of the mining industry in British Columbia. At that time they thought that the known relatively high-grade reserves of those days were going to be depleted.

We're in a different situation now, I think, when we express concern about the mining industry. It's not a concern about reserves; it's a concern about our capital cost and our competitive edge in the world. I know the minister knows that, and I don't think there's any difference between them. I think what needs to be done is to carry the message to the people of British Columbia that the mining industry is in a little bit of a dicey situation and it needs careful attention. It certainly doesn't need uninformed taxation — that's for sure.

Then the discussion moved on to blasting tickets. There were a couple of issues there. One of them was raised by the hon. member for Revelstoke-Slocan (Mr. King), who expressed concern about the possibly arbitrary lifting of blasting tickets when a person has such. The minister, I think very thoughtfully, agreed that a review procedure would be useful.

I hope that he would also go around the other route, though. What we're talking about when we're talking about lifting tickets is something that's after the fact. The concern I was expressing was for some kind of a control before the fact of the acquisition of this potentially dangerous knowledge on the handling of explosives that's necessary for industrial purposes, particularly in the mining industry, but knowledge that can also be turned to socially destructive purposes as well.

In the particular case I cited which had been reported to me, the implication was very definitely that the person concerned did express unusual interest in such things as timing devices and made a very quick departure, indeed, to northern Ireland. It was considered sufficiently important to get in touch with the police. That particular case is past, but the concern I have is: will the government not consider instituting some pre-certification before people go into blasting training programmes, because if by any rare chance the knowledge is acquired by someone who would put it to violently anti-social use, you can lift his ticket but you can't do anything about lifting the knowledge. It does seem to me that there's some need to consider a programme of pre-screening.

There were a couple of other items in the debate. Someone, and I didn't mark down who, made a comparison between royalties and stumpage. If I understand correctly, Mr. Minister, they were attempting to justify the royalty concept by reference to the stumpage concept. Well., the stumpage concept is a very different thing. The stumpage payments, of course, come out of profit as royalties do not necessarily do. Royalties are flat off the top. I would say if you want to relate stumpage to the mining industry I think you probably have to go to the Manitoba approach, where you say there'll be some kind of a rate of return which we say is reasonable profit, and beyond that reasonable profit the state is going to pre-empt a certain — probably rather large — fraction of what's left.

That's a possibility for taxing the mining industry,

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but it's very, very different than a royalty. Royalty is the one that has been so long in British Columbia. Speaking of which, Mr. Chairman, I would like the minister to tell us what is going to be done about the regulations under the Mineral Land Tax Act that have the effect of providing on Crown-granted land the same kind of royalty structure that we had with Bill 31. It's important, I think, that a statement of policy be made by the minister that the regulations under the Mineral Land Tax Act will be changed so as to remove the Bill 31-type, royalty-type provisions and make it quite clear that those sorts of royalties are being taken off all lands, whether Crown-owned or Crown-granted.

Next I would ask the minister if he would give some of his thoughts to the House about the desirability or otherwise of British Columbia, through the national government, encouraging the national government to participate in some way in the embryonic attempts to form an effective world copper cartel. I know there's a lot of arguments pro and con. I'd be glad if the minister would tell us the state of his thinking on that subject.

Next I would ask the minister if he could tell us what studies he now has available and what studies he feels he might make public on the whole subject of the economics of the development of northeastern coal in this province. I know that the minister is studying this in conjunction with his colleague, the Minister of Economic Development (Hon. Mr. Phillips), and probably other cabinet ministers, and I have reason to believe that there have been some task forces doing work on the underlying economics of these northeastern coal properties.

[Mr. Schroeder in the chair.]

I'll tell you my concern, Mr. Chairman, through you, to the minister. Very frankly, my concern is that we might be rushed, by misguided enthusiasm, into putting an overabundance of public money into projects to finance infrastructure which, if looked at in terms of overall rate of return, might really not be a good investment for the province of British Columbia. Some of these properties will be, some may not. All I am saying at this time is: what will the minister make available in terms of information? What kinds of studies does he have about the costs and benefits of the development of this great potential resource — but still only potential?

Next I would ask him a question on that part of his mineral portfolio which has to do with oil and natural gas. Our current oil price structure, looked at on the basis of an average company, gives quite an incentive in terms of netback to producers to do their work in Alberta as distinct from British Columbia. The figures I have obtained, and I've obtained them from industry sources — the minister may indicate whether or not they're correct — refer to an average company working in both Alberta and British Columbia. The figures I'll give here now are the adjusted netbacks after effecting the total change in oil prices and in natural gas prices as contemplated by the federal government in their recent announcement.

At that point, my information is that on the $9-a-barrel price, the producer netback in British Columbia will be $1.67, and on the $9.75 Alberta price, which is conditioned by oil quality and transportation factors — the 75-cent difference from British Columbia on the gross — the netback will be $2.37, which gives Alberta an advantage of about 70 cents. That was old oil — so-called "old" oil. In terms of so-called "old" gas, Alberta of course has a far more consequential advantage because the British Columbia Petroleum Corp., or I suppose more precisely, the cabinet, has not yet seen fit to pass along any of the increased prices to the producer to encourage increased field netbacks.

At the moment, again the comparative figures I have between Alberta and British Columbia, in British Columbia there is a netback of around 16.3 cents on an average price of $1.13 a thousand, or on a million BTUs; and in Alberta there is a price of around 30.3 cents — this is after giving effect to the new prices — which gives Alberta an advantage of 14 cents, or almost double the British Columbia situation, which makes it pretty clear to me that something has to be done on the natural gas side through the B.C. Petroleum Corp., and on the oil side as well. The comparisons on new oil and new gas are different as to numbers but, in terms of the general thrust, it's the same kind of thing. If the minister would give us the direction of his thinking in this regard, I would be very grateful.

I'd also be grateful to have him talk to us a bit about exploration expenditures in British Columbia as compared to Alberta. In Alberta, my understanding is that the incentive on the drilling of certain exploratory wells which meet certain conditions — I think, for example, they have to be three miles away from a producing well — can achieve a return from the government in terms of capital cost of between 30 and 40 per cent. In British Columbia we have a somewhat different kind of incentive, if I understand it correctly. For every dollar spent you can claim 75 cents off your royalties for certain approved exploration expenditures, and I believe you can also sell your credits to someone with production royalty payments if you're an outside producer with no royalties to otherwise net that against.

Now being far from anything like an expert in this field, I want to ask the minister about an article I read in the newspaper the other day which suggested that under the terms of these incentives it would be possible, in certain cases, to drill a sideways hole through the B.C. Legislature and make a profit on

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that, because you'd get back more dollars for having drilled that hole than your cost of actually drilling it. Now I'm not suggesting that, Mr. Chairman — at least not until we recess for the summer, and even then I think it would be imprudent — but if the fact of the matter is that there is more than 100 per cent interest to drill what might conceivably be completely useless holes, it seems to me that would be wrong. There has to be some incentive left to the industry to say: "We've got some money in here too."

As I say, I was puzzled by that newspaper story and I'd be glad if he could shed any light as to how the existing tax structure makes that possible and, if so, what he thinks of it.

HON. MR. WATERLAND: I believe if a person were to drill a hole sideways through this building, he'd strike quite a lot of hot air, if not gas. Right now, Mr. Chairman, in answer to some of the remarks of the member for North Vancouver-Capilano, the B.C. Energy Commission hearings are currently underway and one of the things being discussed there is the netbacks to producers. This government realizes that there must be sufficient return to justify continued exploration and the cost of production in the fields which have been discovered.

We haven't, as a government, to this time had a chance to address ourselves to the whole problem of the petroleum and natural gas return and the return of the government. However, it will be one of our upcoming projects. At the present time the credit system seems to be having the desired effect. We have had a very active year this year in oil and gas exploration drilling and we expect to have an even busier year next year. Now as long as the effect is there and exploration is taking place, perhaps we don't have to mess around with it, other than making sure that there is a sufficient netback because of the coming increases in export prices. We are aware of the necessity of a return to producers to encourage further development, because if we don't have further development, then we will run short much sooner of this valuable energy source.

Interjection.

HON. MR. WATERLAND: This didn't happen in British Columbia, I don't believe. I recall hearing reference to this type of thing in Alberta, too, where if you spend $1 you can get $1.05 back. You know, that's not a very good return — 5 per cent. But it does seem ridiculous.

MR. GIBSON: If it's guaranteed, I'll sure go for it.

HON. MR. WATERLAND: If it's guaranteed, perhaps. No, that is not right and I would never suggest anything like that should be done.

You were speaking again of problems with blasting certificates and policing it. Perhaps there is a case for having some organization clear a person who is requesting a blasting certificate. The Department of Mines doesn't have the machinery to do this. But perhaps consideration could be given to getting a clearance from the RCMP much as a taxi driver has to have. It couldn't be an intensive investigation. The RCMP would be filled full time investigating blasting certificate applications. But I think you are quite right. They shouldn't be handed out like hotcakes just because a person has the technical ability. It's something that hasn't been done, but I think, perhaps, it's something that could be looked at in the future, and I would be more than willing to do so.

You were talking about the northeast coal sector. At the present time there is a cabinet committee on coal. One of the major functions this year is the study of the whole economic aspects of the northeast coal development. This involves the Department of Highways, Department of Environment, Department of Mines and all of the government operational departments, including the Departments of Housing and Labour and so on. Yes, there is a tremendous undertaking, capitalwise, on the part of the government to develop that resource.

This is a rather unique situation where a resource hasn't really been tapped. Yet we have a tremendously large proven reserve, and when it is developed it will be developed almost at the same time. It is going to require railway connections, highway connections, the community infrastructure, to use the word which is quite common with the secretariat. But the whole government has to put in a tremendous investment here, and, of course, we want to be sure that the coal resource is, in fact, going to be developed. The timing right now is that we will have the answers regarding the government cost and government participation as far as providing these services at about the same time that Denison Mines and others in the area will be making fairly firm commitments to develop their resource.

MR. GIBSON: Roughly when is that now?

HON. MR. WATERLAND: It will be late this year. It will be early fall when the bare-bones reports are out, either late this year or early next year before firm decisions are made. At that time we all have to go together, because when the mine is developed the railway has to be in place and there has to be a place for people to live. There have to be roads and electrical power. So the government is really going into this thing in a partnership with industry, and very serious consideration is being given to....

I think it will happen that there will be a user charge placed on that coal to help the government defray the front-end costs of what we have to invest

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in the area. The companies involved are aware of this and they are all for it, saying: "We know it has to be developed, and if you don't help put the community in and the railway system and so on, we will have to." There will be a tremendous investment by industry and by government, and the ultimate result will be the development of this very important resource.

We are also right now in the formulation stage of a general coal policy for British Columbia. We would very much like to see much more utilization of our coal made right here in B.C. as feedstock for the petrochemical industry, gasification, liquefaction of coal. We are planning to.... How we are going to do this we haven't yet decided. But we certainly want to get the government involved in looking at the maximum utilization of this resource here, because it is a technology that is fast developing in the world. We can develop along with the rest of the world so we can take part in it here. It's something that we in British Columbia can and should be able to do as well as anyone in the world, considering the tremendous resource that we have in coal.

You mention the mineral land tax and how it relates to the current legislation on the table regarding taxation. What our intention is, and it has been stated in our press releases on this taxation bill, that once the new Bill 57 becomes an Act and law, then at the end of the year, the time at which the royalties will have expired, we will be passing orders-in-council redesignating lands which have been designated as production areas for the purpose of collecting this mineral land tax as it was based on production. So in effect it will be exactly the same under the mineral land tax and the mineral royalties tax.

MR. GIBSON: How about the super-royalty portion of it?

HON. MR. WATERLAND: The super-royalty portion, as it states in the bill, will end as of the first of the fiscal year this year.

MR. GIBSON: And the same under the Mineral Land Tax Act — will that order-in-council be passed?

HON. MR. WATERLAND: The mineral land tax actually is collected in arrears. What we are collecting now are those amounts which were actually accrued last year. The effect will be the same.

The member for Revelstoke-Slocan (Mr. King) had some very interesting remarks he made about the dropping employment in the mining industry, even though our actual production is going up. It may appear as if employment is dropping, but in effect what is happening is that.... I will refer back to the type of mines that were in existence a number of years ago. I mentioned the fact there were five mining communities in which I had lived that closed down; the towns ceased to exist. Today a one-industry company mining town is becoming a rather rare item; there still are some around. But when a company operated a mine, a community and all the service facilities that went with it, the direct employment by the mine was considerably higher. Now we have mines being developed and they don't have cookhouses and communities to look after. The machineshop facilities are much less than they had to be in the past because much of this work is contracted out. So the direct employment may appear to have gone down, but all of these other services are still required, and they are generally acquired through dealing with other people who specialize in this kind of work.

The member for Revelstoke-Slocan asked me what I meant when I said that ore is renewable. I didn't say that we can renew our ore; what I said was that we are not depleting our ore reserves. We are not, because ever since we have been mining in British Columbians have been adding to the ore reserves by discovery and increases in our technology. So we are not depleting the reserves; we are using the resource as we find it, but we have been, in the past, constantly adding to it.

I have already mentioned northeastern development as far as involvement of the government. The member for Revelstoke-Slocan talked about the responsibility towards communities. As long as we are not directly involved in one-industry towns, I think towns will continue to exist, particularly after mines are no longer workable. A good example right now is the Highland Valley where we have Logan Lake, which was established as a townsite to service the Lornex mine.

We will have other mines in that area, and we will have other industries around that area related to mining and to the forestry and ranching community. So it is not a one-industry town, although it is very heavily dependent upon one industry. There is a tremendous resource in the Highland Valley and it will be many, many, many years before that resource could possibly be exhausted. I am sure that by that time the community of Logan Lake, or similar communities, will have developed other bases to justify their continued existence.

I believe that covers most of the points that have been raised. Oh, the Department of Mines inspection branch — I guess they were talking about its involvement in the industry and the function of the department. The Department of Mines inspection branch has to become more heavily involved in the reclamation aspect of the mining industry. We have over the last half-dozen years developed some good expertise in that department. However, with the rates that especially coal mine developments are taking place now, we are understaffed. We must have more

[ Page 3036 ]

people to carry out this very important aspect of that department's work.

We must also have more staff and expertise insofar as the environmental aspects of the actual mining operations — noise control, dust control and working conditions for the men. We are right now — I, my deputy minister and others in the department — looking at a fairly major restructuring of the actual organization of the department to make better use of the people we have and to just have a good look at where we need more expertise and more people to do the work we know must be done.

MR. GIBSON: Mr. Chairman, I would just remind the minister that I asked him if he could comment on the prospect of British Columbia and Canada participating in the organization which is trying to put together a world copper cartel — as was at least mentioned by the copper task force. They weren't too strong in their recommendation, but it was a possibility that was raised.

Also, in response to his forthcoming remarks on the development of policy on coal, I wonder if he could give us some undertakings about the availability to the public of documentation on this subject, as and when it becomes available. I believe there has been a task force working for the past year which will have produced a great deal of material. Much of the documentation, I would think, produced for the cabinet committee on coal would be of the kind which could be released and would provide the background for an enormously helpful public dialogue.

I would ask the minister if he would be good enough to assure the House to the very maximum extent possible that this documentation will be released. Because to the extent it is undertaken, this northeast coal development will be one of the most consequential public and private investments ever made in the province of British Columbia. I think it is terribly important that the average citizen, if he or she wants to look at it, has the underlying factual information to decide on it.

HON. MR. WATERLAND: Mr. Chairman, the copper cartel situation.... Canada and British Columbia produce a very small percentage of the world's copper. I don't believe that with the amount we produce we could have any effect, really, on people who might tend to want to set or control the price of copper. This government is not now actively seeking any involvement in that way. Perhaps it is something that could be discussed with the federal government, but it has not yet been done.

The coal task force report is at the present time at the printer. I believe it is almost ready for printing, and as soon as it is available, it will be made available to the public. I have read the draft of it; it contains a lot of very valuable, factual technical data and should be of interest. A lot of it is written in laymen's terms so it is quite understandable. Yes, the public should be aware of the nature of our coal resource. I think this is a good way of doing it. We will also be coming up, as I said, with a general government policy regarding development of our coal resources — sometime within the next few months, I would think.

MR. D. BARRETT (Leader of the Opposition): Mr. Minister, could you explain to me why it is that the coal royalty has stayed where it's at when the price of every other commodity has gone up in this province? As a matter of fact, your government has made a point of telling the people of British Columbia that the rationale for huge increases in goods and services provided by the government is to reflect the inflationary drive of prices throughout the world. Coal is now selling at over $50 a ton. Not to belabour the former administration before the former administration — i.e. a real Social Credit group rather than a conglomeration of what some people describe as politicians of the last resort for power....

MR. A.B. MACDONALD (Vancouver East): A rag-out.

MR. BARRETT: A rag-out — is that what it is, a ragout?

Interjection.

MR. BARRETT: My friend, no wonder there is cause for the air-traffic controller situation. If that's your French, we're all in trouble. A rag-out!

AN HON. MEMBER: A ragout is a stew!

MR. BARRETT: A ragout — that's right.

Interjection.

MR. BARRETT: Why in that ragout the member for Columbia River (Mr. Chabot) is not a member, I don't understand — except that he forgot to join the Liberal Party. If he'd joined the Liberal party he would have made it. I won't put any more of that in, because it's out of order.

Mr. Chairman, it seems to me that the rationale is: if you use the ferry you have to pay more; if you have to drive your car, and not have to sell it, you have to pay more; if you're going to go to a doctor, whether you go or not, you have to pay more; if you're sick you have to pay more on extended-care homes — so why doesn't Kaiser pay more for coal that belongs to us?

Formerly Kaiser was paying a royalty around 25 cents a ton for coal. Some sensible businessmen got

[ Page 3037 ]

elected and bumped it up to $1 — then to $1.50 and this April it was to go up to $2.50 a ton. A modest, cautious, small-c conservation increase in light of what Alberta has just done to the mining industry. I've told people to beware of Peter the Red; there's nothing like a socialist masquerading in Tory clothing. Imagine what he is doing to the mining industry in the province of Alberta!

Can we not now see huge ads in the Calgary papers? What was the one...The Albertan that was run by that old wreck — what's his name? Is that one still being printed in Alberta?

AN HON. MEMBER: Yes, but nothing in it, really.

MR. BARRETT: Well, I want to tell you.... Will the mining industry be posing big ads in British Columbia saying: "All those leaving Alberta now come to B.C." because something more dangerous than socialism has arrived in Alberta — i.e. a reasonable mining royalty on coal? Will the mining industry be asking the minister to approach the government of Alberta to say ease off?

Why do the people of this province have to subsidize all these other services when in actual fact coal should be paying its own way? The old-age pensioners have been told that they've got to pay their own unless they carry the bus onto the ferry. If the bus carries them, they got to pay; but if they carry the bus, they don't got to pay. That is Social Credit. That is what the minister told us — the man who spends his extra hours writing out chits for his second cup of coffee. I'm going to send him one of those chits because he too may want to beat the system.

Nonetheless, what are you giving the coal away for? What kind of businessmen are you? You tell everybody in the province that they have to pay more for everything, but Kaiser and Fording only pay $1.50 a ton, when in April it was supposed to go to $2.50 a ton. Are you afraid of Edgar Kaiser, Jr.? Are you afraid of him? Will he write a letter complaining that he won't support you any more? He can't even vote for you — he's American.

What are you afraid of the CPR for, through Fording? Why is it that every citizen in this province has to pay more money, but the CPR doesn't and Kaiser doesn't? You're the Minister of Mines; you're the guy that ran around saying: "Vote for me and I'll help the mining companies." And darn it all, that's what people did; they voted for you and you're helping the mining companies. You kept that promise. You were very clear about that; there was absolutely no confusion. I want the editorials that have been criticizing you lately to leave you alone on that point. Don't you ever criticize this Minister of Mines. He made it very clear what he wanted to get elected for; he wanted to get elected to help the mining companies. And he's certainly kept that promise.

But, Mr. Minister, if Alberta is raising the royalty of coal up to $9 a ton, do you think that the mining companies are going to pack up, leave Alberta and come to B.C.?

HON. MR. WATERLAND: I hope so.

MR. BARRETT: You hope so. Mr. Chairman, that has got to be one of the least intelligent statements made by a minister responsible for resources. If the coal is worth nine bucks a ton to the people of Alberta by royalty, why isn't it worth nine bucks a ton to the people of British Columbia by royalty? And you sitting there with your arms folded, flying with no help except on occasion when you turn back and ask for some help, telling us that you hope those mining companies that leave Alberta will come here and get the coal at a royalty of a buck and a half....

MR. MACDONALD: They are going to leave Alberta and take their coal with them.

MR. BARRETT: No, Mr. Attorney-General, do not fall for that mining company propaganda.

MR. MACDONALD: It is a very ticklish situation.

MR. BARRETT: I know it is. You read those ads when they used to attack the NDP. They used to say: "We're leaving British Columbia and we're going to take the minerals with us." The CPR at one point threatened to roll up the railroad tracks all the way to the Alberta border. You remember that? You were at that meeting with me.

MR. MACDONALD: Was that what it was about?

MR. BARRETT: That is what it was about. That is right — when we met with the Hon. Mr. Sinclair. Wasn't that his name — the fellow who picked up your cigar butt because the company was losing so much money? I remember that.

MR. CHAIRMAN: Please address the Chair, Hon. Member.

MR. BARRETT: Mr. Chairman, $9 a ton for coal in Alberta on royalty — everything else has gone up. Royalty was to go to $2.50 in British Columbia in April. It is May, now June, and Kaiser is not paying its fair share, Fording is not paying its fair share, but the old-age pensioners are told if they carry the bus on the ferry they can have a free ride. What kind of business is that? You are the giveaway gang, sir, through you, Mr. Chairman, the giveaway gang. You knew very well who you got elected for. You got

[ Page 3038 ]

elected to represent the big mining companies.

Is there anybody over there who is going to speak for the people? I want to talk about the philosophy you have expressed about we are always renewing the measured resource. What is it you were saying? There is no depletion because we are discovering new minerals. So there is no depletion.

You have got to be some kind of bureaucrat to figure that out. If you know that there is a copper body somewhere and you measure it, you know you have a copper body size X. If you mine half of it away you have got half-X.

MS. BROWN: No, X minus 50 per cent.

MR. BARRETT: No? Oh, X minus 50 per cent. Right. Okay. You really haven't lost that X-minus 50 per cent because you might go out and find another copper mine that would have double X. So you are really one-half ahead. Is that right?

MS. BROWN: Yes, that is right.

MR. BARRETT: You understand Social Credit better than I do. I always thought that no matter how you cut it, when you dig it out of the ground it is gone. You have come to the House with a theory that when you dig it up out of the ground it is okay. We will fill up the hole with more we find from somewhere else.

MR. BARNES: It grows, that stuff.

MR. MACDONALD: It comes back in Mazdas.

MR. BARRETT: Oh, it comes back in Mazdas. Well, I guess they carry it in the station wagon.

Interjections.

MR. BARRETT: Mr. Minister, have you never heard of non-renewable resources?

AN HON. MEMBER: Yes.

MR. BARRETT: You have. You are not a minister, you poor guy.

Interjections.

MR. BARRETT: Mr. Chairman, I have to make this comment because I have intimate knowledge of this specific information. The problem with that member is that he quit the Liberal Party too soon. You quit it 10 years ago, George. You should have hung onto your Liberal card and you would have made it.

Interjections.

MR. CHAIRMAN: Order, please. Hon. members, let us hear the member for Vancouver East. The member for Vancouver East will address the Chair.

MR. BARRETT: Yes sir, Mr. Chairman. Yes sir, he quit the Liberal Party too soon and Jimmy never joined it, and that was why they have been left out.

MR. L.B. KAHL (Esquimalt): Is that Jimmy Gorst?

MR. BARRETT: Oh, no.

Interjection.

MR. BARRETT: That is a nice suit from Calgary. You don't pay 7 per cent over there. Why do people have to pay 7 per cent? Why are they running to Alberta to buy suits? Because there is a royalty on coal now that makes up for the difference of the sales tax. The people of this province have to pay the sales tax. In Alberta when you buy your suit you do not pay a sales tax because the coal royalty makes up the difference. Either, Mr. Minister, through you, Mr. Chairman, the Alberta government is masquerading as a Marxist front and should be exposed to the John Birch Society, or they are taking a reasonable approach to the mineral resources and the non-renewable resources such as coal.

There is a group, Mr. Chairman, through you, who believe that Richard Nixon was a secret communist agent. Perhaps Peter Lougheed is a member of the same group. It is all a Marxist plot to raise the coal royalty to $9 a ton under the guise of having a conservative, businesslike government. The only reason that we did not raise it here in British Columbia is because the socialists could not be roped into the Marxist plot.

Interjections.

MR. BARRETT: Could be. What else explains the $9 a ton royalty in Alberta — a reasonable demand of a return to the people of Alberta, a share of what God left in the ground for those people to enjoy? It could not be that simple, could it, Mr. Chairman? Could it be that simple that the government of Alberta says, in a businesslike fashion, that when coal is selling at $50 plus per ton we should get $9 a ton back?

Is it really a Marxist plot? Is it really a nefarious attempt to drive the mining industry out of Alberta, through you, Mr. Chairman, into the warm, waiting arms of a loving Minister of Mines who will say: "Don't worry my friends, we only sock it to the people, not to the mining companies"? — that warm,

[ Page 3039 ]

loving embrace from the happy minister who on occasion gets confused, or occasionally is mistaken, but who has no mistake about his purpose in coming to this chamber — and that was to provide comfort and succour to the mining companies of this province.

Mr. Minister, through you, Mr. Chairman, you tell the people of this province why coal isn't paying $2.50 a ton royalty. You tell us why Kaiser's profits went up to $71 million. Even the Minister of Human Resources (Hon. Mr. Vander Zalm) would agree that that company is not eligible for welfare. What are we giving them a subsidy for? It's black gold in British Columbia for any coal mining company. Black gold!

Now if you're going to sell the programme around this province that everybody has to pay more for this and more for that, you tell us — when there's no further capital expenditure by Fording — why we don't get protection from the Consumer minister to see that the consumption of our coal pays a fair share.

Oh, they'll chase somebody down on the ferry who didn't pay their 10 cents for a second cup of coffee. Can't you see the whole government administration organized to chase somebody down to avoid getting a second cup of coffee? If they can mobilize that kind of machinery for a dime for a cup of coffee, why can't they send a polite letter to Kaiser saying: "Please pay more, your honour. Humbly we beg you as the Government of British Columbia;we don't want to upset you or we don't want to ruffle your nerves. Please don't take your mine away, but would you kindly pay some more for the coal"?

Got a massive bureaucracy cranking out 10-cent slips for a refill on a cup of coffee, but we can't ask Kaiser for another buck.

MR. E.O. BARNES (Vancouver Centre): What does it cost to produce those slips?

MR. BARRETT: Mind you, Kaiser doesn't come across on the ferries. Anybody who makes $71 million flies his own plane over here. Swish comes the jet!

MR. BARNES: Now we get to the deductibles.

MR. BARRETT: Why, there was some swishing going around during the election campaign when the Premier was in private jets.

MR. BARNES: More taxes.

MR. BARRETT: Who would take a political candidate around in a private jet?

MR. BARNES: Right on!

MR. BARRETT: Why would someone take a political candidate around in a private jet?

MR. KAHL: Manny Dunsky would.

MR. BARRETT: Do you think they wanted that candidate to get elected?

MR. CHAIRMAN: Now to vote 130.

Interjections.

MR. BARRETT: Yes, 130. I don't know if that member has ridden in the private jet, but his policies are making sure that they can well afford to be comfortable when they ride.

Why be bothered about a second cup of coffee when you can buy a whole plantation with the profit you're making on the mines?

MR. KAHL: Is that what Manning told you?

MR. BARRETT: Manning! You guys are so ignorant of the background of your own party, you don't even know who Manning was. (Laughter.)

AN HON. MEMBER: A director of the CPR (Laughter.)

MR. BARRETT: E.C. was one of the fathers, and he never joined the Liberal Party. That was shortly after Solon Low....

MR. CHAIRMAN: Order, please, Hon. Member. Now to vote 130.

MR. BARRETT: Mr. Chairman, it's important for me to inform the members just exactly what they joined. I don't want anybody running around accusing them of being opportunists.

MR. CHAIRMAN: Hon. Member, what is most important now is that we're on vote 130.

MR. BARRETT: Yes, you're quite right. It's just that the interruptions give me a great deal of chagrin, and it bothers me to think that such naivete would actually be part of this House.

MR. WALLACE: It's because of the new member in the House.

MR. BARRETT: Kaiser's net return from 1971 to 1974, even with our royalties, Mr. Chairman, went up 350 per cent. Generous socialists moving the royalty up from 25 cents to $1.50, yet the net return increased 350 per cent.

[ Page 3040 ]

Interjections.

MR. BARRETT: The kind of money they're making they can go back and recover all those ships at the bottom of the ocean that the member wants them to mine for, and put them together. You know, the ones they built during the war that fell apart — they can mine them and bring them back. (Laughter.)

MR. WALLACE: I never said a word!

MR. BARRETT: It's not you, Mr. Member. Your fault is that you've got a philosophy and some principles; that's why you're stuck down there.

MR. BARNES: They've abandoned him.

MR. BARRETT: If you'd only jump ship, just imagine — you could be the Minister of All Health, through the Minister of Education, in the province of British Columbia.

Mr. Chairman, production costs for Kaiser went up only 100 per cent — only went up 100 per cent from 1971-1974. A 250 per cent increase in profit by Kaiser under socialism!

I hope they are safe from a Conservative government, like Alberta, where those dangerous red Tories will ask for $9 a ton. I want it publicly stated here that we like what Peter the Red is doing, Mr. Chairman. Peter the Red is not a front for the communist conspiracy outlined in the John Birch material. He's trying to get a fair buck for the people of his province, and that's all we're asking this government to do.

That's all we're asking you to do. You explain to the old-age pensioners why they have to pay to take the bus on the ferry unless they carry it on, while Kaiser isn't paying its fair share. I'd like to hear your philosophical analysis of what Peter the Red is doing, through you, Mr. Chairman, and what you intend to do with the Alberta report. I'd be very interested. I think the Chairman would too, because even in Chilliwack they could use a new road from the money that they are not getting from Kaiser.

HON. MR. WATERLAND: I have stated publicly on several occasions that the government right now is studying coal royalties. What we have to be sure when we change royalties is that the proper thing is done.

As I mentioned after the member for North Vancouver-Capilano (Mr. Gibson) was speaking, there is a tremendous expansion in the coal development of this province all but ready to take place in the northeast sector. We are indeed looking at coal royalties, and I'm sure that Kaiser Resources is one company that right now could pay more royalties. What we have to be careful of is that when we add a royalty to coal, we must take consideration of the high-cost producer versus the low-cost producer, and that is what Alberta did. The Alberta royalty is a sliding royalty based on profit. If a company makes a higher profit they pay a higher royalty, and that's really the way it should be.

This is the type of thing that we're looking at. Kaiser, as a low-cost operator, as I said, could afford to pay a higher royalty, but when you get into a very high-cost, underground mining operation, perhaps that company could not afford to pay the same royalty.

So the thing is being reviewed, and yes, the people of British Columbia will be getting a fair return from the development of the coal resource. We want to be sure that when we do it, it is done properly, so that is why we are having a very, very close look at it right now.

MR. BARRETT: The minister has informed the people of this province that in his opinion, yes, Kaiser can pay more. Why don't they pay more right now?

AN HON. MEMBER: He's looking at it.

MR. BARRETT: What do you mean he's looking at it! He's already told us they can pay more. He just said it was a low-cost operation. If everybody has to pay more for ICBC and pay more for the ferries, why doesn't Kaiser pay more now? The minister confessed to this House that Kaiser can pay more. They didn't do any expensive study to see if the old-age pensioners could pay more. They didn't do a study to see if the young people could pay more. They just boosted the price up. That's all they did.

Why didn't the Minister of Transport and Communications (Hon. Mr. Davis) do an in-depth study on the effect on tourism of the increased rates on the B.C. ferry system? He never made that statement that everybody could pay more. He's too wise a politician to do that. But this minister has said in this House that Kaiser can pay more. They've got a low-cost operation. What are you sitting on this study for? You've got the answer: announce today that coal should be $2.50 a ton royalty to Kaiser, retroactive to April 1. You know that.

He's told you, Mr. Chairman, that Kaiser should be paying more. But why the timidity? Why is it that they can sock it to the people but they can't put the facts in front of them and sock it to Kaiser? Why are they afraid of, Mr. Chairman? I'll sit in the room with you when you tell the bad news to Edgar. He's an understanding guy. He can write a cheque to cover it — $71 million net they made last year.

AN HON. MEMBER: After taxes.

MR. BARRETT: More than enough to cover the deficit on the ferries, more than enough to pay for

[ Page 3041 ]

medicare costs, more than enough to help people with ICBC rates, but you say to Henry Kaiser: "Take the money back to America while we sock it to the people here." How can you sit there and say: "Yes, we know that they can pay more, but we're reviewing it."? What are you reviewing? The fact that they can pay more? Charge them it now.

You tell me one good reason, through you, Mr. Chairman, why the producing B.C. mines that you know are low-cost producers should not be paying more for coal today. If you don't, Mr. Chairman, there are people who are going to run around saying that the Kaiser interests and the Fording interests may be involved politically with this government. That's what some people are going to say, even up north where they are looking for jobs — and they're looking for their MLA, too.

Why shouldn't Kaiser pay more now? You've told us today they can afford to, as it's a low-cost operation. Why aren't they being charged more now for their coal, through you, Mr. Chairman? What is the reason that Kaiser is not paying more when everybody else has to pay more for everything? Why? Would the minister like to reply?

Could you tell me, through you, Mr. Chairman, why Kaiser doesn't pay more royalty when you admit yourself that they can afford to pay it, that they are a low-cost producer? Could you tell me why? Could you send a little letter out from your office to Kaiser saying: "It's $2.50, retroactive to April 1"?

Mr. Chairman, why is it that everybody in British Columbia has to pay more for everything except Kaiser and Fording when it comes to coal? Why? Is that fair? Do you think that's fair, through you, Mr. Chairman? I don't think you think it's fair, Mr. Chairman. You even took a cut in salary while Kaiser was making $71 million. I don't think that's fair.

Why, Mr. Minister? Will you tell me why? What's the rationale why Kaiser, through you, Mr. Chairman, isn't paying more royalties?

MR. CHAIRMAN: Hon. Member, I think the minister has the question, but he cannot answer as long as you're speaking.

MR. BARRETT: Well, will you signify that you have an answer, Mr. Minister?

AN HON. MEMBER: Why don't you sit down!

MR. BARRETT: Now, don't be nasty. That's not in keeping with your nature. You're such a kind, gentle soul and I don't want you to interrupt.

MR. CHAIRMAN: Order, please!

MR. BARRETT: Mr. Chairman, I need to know so I can tell the people of this province why Kaiser isn't paying more when the Minister of Mines of this province tells the people of this province that Kaiser is a low-cost producer and Kaiser can pay more, especially in light of the fact that people pay more for the ferries without.... Actually, let's call the ferry charge a royalty to use the service. The minister says we can't change royalties until the proper research is done. Well, your colleague changed the royalty on the ferries without the proper research being done. There was no research at all. He said: "We're not getting enough money." Look at the effects on the small businessmen that actually voted for those people over there.

MR. BARNES: Look at Vancouver Island's economy right now.

MR. BARRETT: Mr. Chairman, the same thing holds for the minister over there. Why isn't Kaiser paying more?

I think, Mr. Chairman, you understand the question, and I think the members here understand the question. I'm not so sure about the backbenchers, but does the minister understand the question?

Mr. Minister, through you, Mr. Chairman, do you understand the question? Could you please tell me, through you, Mr. Chairman, why Kaiser, which you say is a low-cost producer and can pay more in royalties, is not paying more? Could you tell me that? If your study proves that they can't do it, you refund them money. But you don't need a study; you already know it, so will you tell me why?

Do you owe political favours to Kaiser?

MR. CHAIRMAN: Order, please! The minister has the question and the only way he can answer is if he can gain the floor. Perhaps you could move to your next point.

Shall vote 130 pass?

MR. BARRETT: Mr. Chairman, you were under the impression the minister had the question, but it's obvious he doesn't have the question.

Interjections.

MR. CHAIRMAN: Order, please! The Leader of the Opposition has the floor.

MR. BARRETT: Boundary-Similkameen is a mining community. Can you explain to me, Mr. Chairman, why social services in Boundary-Similkameen are closing down because there's not enough revenue from resources like Kaiser, which are getting our coal too cheap compared to Alberta, and the minister already admits that they're low-cost producers and they could be paying more? Can you tell me what philosophy backs

[ Page 3042 ]

up a decision that even though Kaiser can pay more, they are a low-cost producer, but we'll not be charging them more, while at the same time, there's more royalty on riding the ferry, more royalty on ICBC, more royalty on human services and health care?

Mr. Minister, through you, Mr. Chairman, the people of this province were told that they were going to have a businesslike administration. Part of the basis of being businesslike is to answer questions.

Why does the minister sit there silently while a simple question is put to him when he himself admits that Kaiser is a low-cost producer and Kaiser can pay more right now? Why doesn't Kaiser pay more royalties? A simple question, Mr. Minister, through you, Mr. Chairman.

Why?

You don't choose to answer?

HON. MR. WATERLAND: Mr. Chairman, through you to the second member for Vancouver East, I did say that a review of the whole coal royalty situation is taking place, and right now Kaiser is one of the lower-cost producers in British Columbia. I don't know — our study is not completed — what their profitability per ton of coal is. I know they made a very healthy profit last year. They also produced an awful lot of coal. Until we find out at what rate of royalty they and all the other coal companies should be, I am not going to arbitrarily increase that particular operation in isolation from others. I think the whole coal industry has to be treated the same, and when our studies are completed....

MR. BARNES: Be consistent.

MR. CHAIRMAN: Order, please.

HON. MR. WATERLAND: I didn't do that to you, Emery.

Interjections.

MR. CHAIRMAN: Order!

HON. MR. WATERLAND: When our studies are completed, then we will do the proper thing.

Interjections.

MR. CHAIRMAN: Order, please.

Interjections.

MR. CHAIRMAN: Order, please! If we could just have order, please, from the second member for Vancouver Centre (Mr. Barnes), then we can proceed.

MR. BARRETT: Mr. Chairman, there are only two producing coal mines in British Columbia of any significance: one is Fording and the other is Kaiser. A review of policy related to new coal developments in the northeastern sector of the province is completely appropriate. Brameda has vast holdings, there are other lease holdings in the area, and no one is expecting, Mr. Chairman, that those people with production possibilities be faced with any changing scale. It is appropriate, I think, that the minister realistically say that he is assessing all of the costs — the varying levels of production costs, underground mining, strip mining — but, Mr. Minister, I am speaking to you about the two major producers now. They don't need to wait for the costs of underground mining. They are not doing underground mining. They're strip-mining. Their method of mining has not changed.

Now you have told this House already that, in your opinion, Kaiser is a low-cost producer. You have told this House already that Kaiser can pay more, and I assume that includes Fording because I think we would both agree that Fording and Kaiser have similar costs. I assume, Mr. Chairman, the minister is aware that both Kaiser and Fording have similar costs. Kaiser made $71 million last year. There's a total of 11 million tons of coal shipped out — approximately 11 million tons of coal. That's about $6.80 profit on a ton of coal that Kaiser made last year if they shipped out all the coal, but they didn't ship out all the coal. Fording shipped out some. So conservatively we could say they are making a minimum of $7 a ton profit — a minimum.

The other factor that has to be included in this is that Kaiser was prepared to pay the other dollar. It's not a new policy. Kaiser and Fording were aware that the royalty was to go up on April 1 to $2.50. That was announced public policy, Mr. Chairman. Kaiser was aware of it; the people of this province were aware of it. There was no need for further study; there was no need for further examination. Kaiser was prepared and ready to pay another $1 a ton on April 1. Now the people weren't prepared to pay more on the ferries, ICBC....

MR. R.E. SKELLY (Alberni): They had a promise of an anti-inflation programme.

MR. BARRETT: They had a promise of a programme not to pay more in taxes, but when a company on record in this province clearly knew that a ton of coal was to go up $1 more in royalties on April 1, government policy was announced that the royalty was all of a sudden not to be applied — and Kaiser's profit is $71 million! Why, Mr. Chairman, is Kaiser not being asked to pay that dollar that they agreed to pay before the new government was elected? What circumstance changed their

[ Page 3043 ]

understanding that the royalty would go up by a dollar? Did it have anything to do with politics beyond a businesslike approach? What is businesslike, Mr. Chairman, about a company expecting a dollar increase on a ton of coal and then not getting it?

Have you talked, Mr. Minister, to Mr. Kaiser about this? Has the minister met Mr. Kaiser and discussed this? I ask that question, Mr. Chairman: has the minister met with Mr. Edgar Kaiser, Jr. to discuss the coal royalty? Have you ever met with Mr. Edgar Kaiser, Jr.? Was it within the last three months?

MR. SKELLY: Just before the campaign.

MR. BARRETT: Was it in Vancouver? It was in Victoria. It was in Victoria that the meeting took place in the last three months with Kaiser. That's right. Now we're getting closer.

We've got three facts out of the minister. Let's review them. One, Kaiser is a low-cost producer. Two, Kaiser can pay more royalty. Three, the minister met with Kaiser in Victoria within the last three months. Add that to the fact that before Social Credit was elected Kaiser knew that the royalty was going to go up to $2.50 in April. It does not take Sherlock Holmes to figure out, Mr. Watson, that some strange circumstance occurred between last fall, when Kaiser knew that the royalty was going up $1 a ton — between that time and the minister met with Edgar Kaiser in his office. He announced today that Kaiser could pay more. Kaiser is a low-cost operator. But Kaiser will not pay more.

Mr. Chairman, I leave it to you as the one-man jury to come in with a verdict. Did something go on in the minister's office that all of a sudden changed the ball game for Kaiser? Was Kaiser told in the minister's office that the royalty that was to go up would not go up? If that is the case, why was Kaiser told that in the minister's office? The minister should tell us that. Thank you, Mr. Minister.

HON. MR. WATERLAND: Mr. Chairman, I have met with Edgar Kaiser twice in Victoria — perhaps three times — since assuming the office of Minister of Mines. We have had discussions about their undertakings in other mining operations in British Columbia, the Hosmer-Wheeler and other properties which they were considering becoming involved in. No discussion was had with Edgar Kaiser regarding coal royalties.

MR. BARRETT: Mr. Chairman, the minister has told us — we must not doubt the word of an hon. minister — that he has had no discussions with Henry...or with Edgar Kaiser. Certainly not with Henry anyway — you're not Mackenzie King. You don't have that kind of....

You have had no discussions with Edgar Kaiser, Jr. about coal royalties in British Columbia. Is that what you are saying to us — no correspondence, no discussions about coal royalties in his operations in British Columbia?

HON. MR. WATERLAND: Mr. Chairman, the discussions I had with Edgar Kaiser were wide-ranging. I told him that we were going to be making a study about coal royalties, just as I have told the House, just as I have stated to the press. There was no discussion regarding royalties at the present time or the increase in royalties which the second member for Vancouver East refers to.

MR. BARRETT: Mr. Chairman, the minister has said to us that he has met with Edgar J. Kaiser three times in Victoria. The substance of part of the conversation with Edgar Kaiser, Jr. is that he informed Edgar Kaiser, Jr. that there would be a review of the structure of coal royalties in British Columbia and that he did not speak specifically about any change to the present royalty with Mr. Edgar Kaiser, Jr. and has not exchanged correspondence with the Kaiser Co. about their specific royalty as a result of conversations in his office with Kaiser. Is that correct?

Interjections.

MR. BARRETT: Correct.

Interjection.

MR. BARRETT: That's correct.

MR. CHAIRMAN: Order, please. Please proceed.

MR. BARRETT: Thank you. Okay. Now we've established these facts in a very painful process, three meetings with Kaiser — told them that there would be a review of general coal royalties but no specific comments on Kaiser's present royalties. Was the minister aware of the public information that the previous minister had stated publicly and the former Premier had stated publicly that Kaiser was aware that its royalty was going to go up by $1 on April 1, 1976? Was the minister aware that that was the policy announced, declared publicly, and that Kaiser was ready for that $1 increase? Was the minister aware that that was the former administration's policy publicly announced?

Interjections.

MR. BARRETT: Well, I knew about it because I had a number of lengthy conversations with the former Premier. The press knew about it because they had a number of lengthy conversations with the

[ Page 3044 ]

former Premier. The people of this province knew about it because the former Premier, as I recall it, made that clear in every one of his non-political speeches in reporting to the people of this province.

If the people of this province and Edgar Kaiser, Jr. and the press all knew that coal was going to go up by $1 on April 1, did the minister know that? Perhaps the minister could tell us.

Could you confirm or deny that you are the only person in British Columbia connected with the mining industry who didn't know that coal was going to go up in royalty by $1 a ton on April 1? Could you confirm or deny that, through you, Mr. Chairman? Were you the only person connected with the mining industry in all of British Columbia who did not know that coal royalty was going to go up $1 a ton on April 1?

Did your department know, through you, Mr. Chairman? Did they tell you? You didn't discuss it with any junior?

I discussed it with Mr. Edgar Kaiser, Jr. The former Premier discussed it with Edgar Kaiser, Jr. The former Minister of Mines (Mr. Lauk) discussed it with Edgar Kaiser, Jr. At a public meeting in Fernie it was announced. But this minister didn't know about it. Where was he? He was on a bus from Kamloops packing in the delegates for the nominating convention.

MR. LEA: He was in the bushes.

MR. BARRETT: Incredible! All right, we excuse him. I forgive him for not knowing publicly that Kaiser was expecting a $1 increase a ton, through you, Mr. Chairman. I forgive him for not being aware of that in his three meetings with Kaiser wherein he did not, according to his word, speak to Mr. Kaiser about the coal royalty.

Having forgiven that minister all that ignorance he professes with some modesty, I ask the minister again: now that you have this information, now that you're aware this is a matter of record, why hasn't Kaiser been paying an additional $1 a ton from April 1 when they were all ready to pay it?

Who in government made the policy decision to rescind the increase in the royalty on coal that Kaiser knew was coming? Who was present at the policy-making decision that informed Kaiser that the $1 a ton more that they were expected to pay on April 1 was no longer necessary? If the minister did not speak to Kaiser about their coal royalty, who sent the semaphore signal to Kaiser that the buck they were going to send in, in April, was no longer expected? Was it done by sign language, flashing mirrors, waving flags, telegram, or smoke signals?

AN HON. MEMBER: Smoke signals.

MR. BARRETT: We know that it was not done by the minister. Would he tell us what person in his department was instructed by someone who made the policy decision not to charge Kaiser the dollar a ton? Who was it? Who was it who told Kaiser, after three meetings with the minister at which they did not discuss Kaiser's royalty, that Kaiser would not have the increase that they were expecting to have, that was publicly announced months before? Was a letter sent? Or was it by chemical transmission of mutual feelings of compatibility in politics? Was it by osmosis, Mr. Chairman? Or was it by the old mining technique known as leaching?

AN HON. MEMBER: It was the Phantom.

MR. BARRETT: Yes, there is a mining technique known as leaching. Leaching! Leaching! That means climbing onto the public purse and sucking away at one's greatest energy against the people of British Columbia, on the resources of the people of British Columbia. Leaching! Kaiser had been leaching. Fording has been leaching. They were not expected to be able to leech as well, but now, through osmosis, fIag signals or some mysterical method...mysterious, mysterious, excuse me. Strike the word "mysterical" from the record because we might get a Speaker's ruling on it. (Laughter.) And it would be negatized. (Laughter.)

By what method was it that Kaiser in non-conversations with the non-minister on non-discussions about the non-royalty got the message that he didn't have to pay the increase? Would you please tell me how they got the message they didn't have to pay the increase, through you, Mr. Chairman? How did they get the message?

Interjection.

MR. BARRETT: No, the people of this province would like a better share back on the giveaway of resources. That's all. That's all.

Interjections.

MR. CHAIRMAN: Order, please, hon. members.

MR. BARRETT: Just a little bit we'd like to know. Who was it who sent the message to Kaiser? If you didn't talk to Kaiser about the royalty — and we have your word for it — if you agree that Kaiser is a low-cost operator, you agree that Kaiser can pay more, you know that Kaiser was asked to pay more, you didn't talk to Kaiser about the increase, who sent the message to Kaiser that they did not have to pay the additional $1? Please tell me.

AN HON. MEMBER: There was a letter....

[ Page 3045 ]

MR. CHAIRMAN: Hon. Member, may I remind you that....

MR. BARRETT: What letter?

MR. CHAIRMAN: Order, please!

Interjection.

MR. BARRETT: What letter?

AN HON. MEMBER: Oh, there was a letter.

MR. BARRETT: There was a letter, was there? Oh....

MR. CHAIRMAN: May I remind the speaker who now has the floor that we can ask questions in Committee of Supply? We can ask questions either singularly or we can ask them in groups — or whatever you wish. But we cannot insist on an answer. I'm sure the member knows this.

MR. BARRETT: That's correct. Mr. Chairman, I want to thank you for reminding me of those very succinct rules that govern this House and committee.

MR. CHAIRMAN: And I know you have respect for them.

MR. BARRETT: I certainly do. That is why I'm only asking one simple non-complicated question at a time. That is, who gave the message to Kaiser that they would not have to pay the additional $1 on royalty? One question and it meets the rules, and I'd like the minister to tell me. Who was it?

AN HON. MEMBER: Maybe he sent him a memo.

MR. BARRETT: But, Mr. Chairman, who told Kaiser Coal Co. that the expected $1 per ton increase in royalty would no longer be expected? Who terminated the pregnancy? What it means is that they were pregnant with expectation — waiting to pay the increase that was publicly announced — having their accountants adjust the proper picture, having the shareholders advised how it was being done, when lo and behold, in three magical meetings not once was the royalty with Kaiser discussed between the minister and Kaiser.

They were talking about bridge, jets, hunting, sunken freighters that the grandfather built.... What was that?

MR. SKELLY: Assimilating with Alberta.

MR. BARRETT: A simile, no, not with Alberta. They talked about everything — astrology, astronomy. But they never.... Isn't it amazing that Kaiser's prime interest in British Columbia is coal mining — and they never discussed in three meetings the royalty on coal. Isn't that a coincidence?

I have to take the minister's word, because his record on giving his word is almost impeccable. There have just been a few mistakes.

I asked the minister who told Kaiser that they don't have to pay the additional $1. Everybody knows who got the message on paying more for the ferries. Everybody knows who got the message on paying more for ICBC. Everybody knows who got the message and who gave the message on ICBC: "if you don't like it, sell the car." Gratuitous editorial opinion at the same time. Who was it that told Kaiser they don't have to pay the $1? If you didn't talk to them about coal royalties, who was it?

AN HON. MEMBER: Simple question.

MR. BARRETT: That's the question.

MR. CHAIRMAN: Hon. Member, I think the minister has the question. Perhaps you could proceed to the next question.

MR. BARRETT: Ehrlichman and Haldeman met for four hours and never discussed the break-in?

AN HON. MEMBER: The day after.

MR. BARRETT: The day after, oh. (Laughter.) The minister has told this House four facts, according to him. One, Kaiser is a low-cost producer. Two, Kaiser can pay more. Three, he met with Kaiser. Four, in the three meetings with Kaiser he never discussed coal royalties with him.

I believe the minister. I believe that Kaiser can pay more money. I believe that Kaiser is a low-cost operator. I believe that he met with Kaiser on three occasions, and I believe he never discussed coal royalties with Kaiser. Therefore who was it who told Kaiser they wouldn't have to pay the additional $1 that they were told they were going to have to pay before you were elected? Who carried the message to Kaiser that their ship had come in? — and I'm not talking about a B.C. ferry either. This is a gold-plated, non-sinkable ship known as S.S. Profit.

AN HON. MEMBER: Registered in Monrovia.

AN HON. MEMBER: ...in Liberia.

MR. BARRETT: No, no, not registered in Liberia. Registered in Victoria — secure in the knowledge of a comforting new government that doesn't tell them by word through the minister that a royalty structure has changed, but somehow they got the message.

[ Page 3046 ]

How did Kaiser get the message? That is the question I want to know.

AN HON. MEMBER: An election promise.

AN HON. MEMBER: Did they meet during the election?

MR. BARRETT: Now, fellows, you'll have your turn. But you are a bunch of doubters here.

MR. CHAIRMAN: So ordered. (Laughter.)

MR. BARRETT: So ordered — that's right, Mr. Chairman. I agree with you. I don't want to deal in speculation like my colleagues who have suspicions about the relationship in the coal mine between Kaiser and the minister. I want to deal with the facts the minister has given to this House — and the facts are that Kaiser was expected to pay a dollar a ton more in April 1.

He has not acknowledged that he knew that, although I claim he is the only person in the mining industry in all of British Columbia that did not know that fact. Two, he said Kaiser can pay more. Kaiser is a low-cost operator. Three, he met on three occasions with Edgar Kaiser, Jr. Four, he did not discuss with Kaiser Junior the increase in the coal royalty.

I want to know the answer to a simple question. Who was it in this new government who told Edgar Kaiser, Jr. that the $1 more a ton that they must pay for coal will no longer be expected from them as new Social Credit government policy? Would you tell me who announced the policy to Kaiser? That's all.

Interjection.

MR. BARRETT: Do you speak for the mines policy, through you, Mr. Chairman, or was it someone else who gave Kaiser the message?

MR. CHAIRMAN: Hon. members, perhaps in order to avoid becoming tedious and repetitious the member would like to...

SOME HON. MEMBERS: Oh, oh!

MR. CHAIRMAN: ...change his line of questioning.

MR. BARRETT: Certainly. I agree with that. One of the ways of avoiding becoming tedious and repetitious would be for the minister to answer a question.

AN HON. MEMBER: He's scared to get up.

MR. BARRETT: I can't think of a better way of just making me sit down and shut up and behave myself like a good little boy who's supposed to, in face of this businesslike government administration, withstand the onslaught of withering words from the minister who in his scintillating debate at this point is unable to tell us who in the world it was who told Kaiser they wouldn't have to pay an extra $1 a ton for coal.

Mr. Chairman, I do not wish to be repetitive. I do not wish to bore the House. But on behalf of the innocent working people of this province who are bearing our unfortunate and unnecessary tax load, I ask a simple question: why isn't Kaiser paying its fair share? Who told Edgar Kaiser, Jr. that that buck a ton is no longer expected? Who passed the buck?

Mr. Chairman, who told them that the buck doesn't get passed. The buck doesn't stop here. Who told them: "You don't have to pay the buck boys; your gang got elected"?

Well, you understand that. I understand it. The Clerks are not asked to understand anything, Mr. Chairman. You understand it, and I'm not assessing their capabilities. I'm only asking a definition of their responsibility. You understand it. How come that minister doesn't understand it?

MR. WALLACE: Don't attack the Clerks.

MR. BARRETT: I will never attack the Clerks. (Laughter.)

AN HON. MEMBER: No matter who's on top.

MR. BARRETT: I try to protect the Clerks...if they'd only wash their gowns once in a while. (Laughter.)

Mr. Chairman, I ask you this very clearly. Who told Kaiser that the buck was killed? You remember that about Cock Robin?

AN HON. MEMBER: Who killed Cock Robin?

MR. BARRETT: Who killed the buck? (Laughter.) Who killed the buck?

Interjections.

MR. BARRETT: Well...?

MR. CHAIRMAN: Hon. Member, if the rules provided, if the standing orders provided, that I could insist that the minister answer, then I would certainly enforce that standing order, but it does not provide that, and as a result I think the hon. member knows we cannot insist on an answer.

MR. BARRETT: Mr. Chairman, I'm not insisting on an answer.

[ Page 3047 ]

MR. CHAIRMAN: Oh, then I'm mistaken.

MR. BARRETT: Yes. I'm just asking the question, but I assume the people of British Columbia would insist on an answer. How unfortunate it is that there's not a direct radio broadcast. Just think of the amount of money they could make on commercials when the silence from the minister could be filled with all those commercials.

Did the Minister of Education (Hon. Mr. McGeer) tell Edgar Kaiser that it wouldn't be necessary to increase the coal royalty by $1 because we'd sock it to him on ICBC? Is that what it is? "We'll make it up another way. "

Did the Premier tell Edgar Kaiser, Jr. that the buck would not be expected because "we're going to soak it out of the people, not out of our resources."?

AN HON. MEMBER: Sales tax.

MR. BARRETT: Did the Minister of Health tell him that we're going to get it out of the people in medicare premiums? Let the sick pay while Henry flies over us.

Did the Minister of Municipal Affairs tell Edgar Kaiser, Jr. that "it's okay, Eddie, you don't have to pay the buck, we'll get it out of the homeowner."?

Who did it? They all scramble to the press to announce government policy. But when you ask them who announced this policy, "We don't know." Was it a civil servant? Is there a civil servant empowered to announce government policy decisions? Was it done in a vacuum?

Who tells the mining industry what their royalty will be? Will you answer that question, Mr. Minister?

Interjections.

MR. BARRETT: Thank you, Mr. Minister. I'm anxiously awaiting.

HON. MR. WATERLAND: Mr. Chairman, I don't know if it was a question or an act or what, but the former Premier, the present second member for Vancouver East and his government of the time developed a policy which was to increase by $1 a ton the royalties charged to Kaiser Resources as of April 1.

MR. BARRETT: Right!

HON. MR. WATERLAND: Now this government is under no obligation to carry through with the policy set by that former government. We have seen what their policies did to this mining industry, and we don't want that to happen with the coal industry. We are therefore developing a realistic policy to deal with royalties on coal, as I have said, and as soon as this policy is developed it will be put into place.

MR. BARRETT: Thank you very much, Mr. Minister. You've told us that you don't agree with our policy. You've told us that you met with Edgar Kaiser. You've told us you didn't discuss coal royalties. I want to know who it was who told Kaiser that they wouldn't have to pay the $1 they were expecting to. Could you tell me that?

HON. MR. WATERLAND: Mr. Chairman, I guess it has to be spelled out in a little more detail for that member. Neither Kaiser coal, nor any other coal company, was assessed that extra $1 by the former government or by this government.

MR. BARRETT: That's right. They were going to be assessed.

HON. W.R. BENNETT (Premier): Don't expect the province to believe that!

HON. MR. WATERLAND: This government did not assess that $1; therefore Kaiser Resources did not pay it.

MR. BARRETT: Mr. Chairman, we are getting closer and closer. Would the minister please tell us who told Kaiser that they were not going to institute the policy?

MR. LEA: You won't find the answer in there, Tom.

MR. BARRETT: The minister says that he had three meetings with Kaiser. The minister says he was aware. Now we've had the first admission by the minister that he was aware that coal was going to go up by $1 a ton; he's told us that now. He has denied the story that he was the only person in the mining industry of British Columbia who didn't know. Who didn't know it was going to go up to $1. Now he admits he knew it was going to go up $1, because that was our policy. He admits that.

Interjection.

MR. BARRETT: No, he's not misinforming the House; he just didn't answer that before, so he's not in the pattern of telling a fib; it's just non-information. Okay? Have you got that straight?

He knew that Kaiser had to pay $1 more. Kaiser knew they had to pay $1 more. He did not agree with the policy of them having to pay $1 more. However, he did not discuss with Kaiser their royalty or the change in policy, that $1 more was expected. Who told Kaiser that the $1 was no longer expected? That's a valid question. If the minister of the Crown

[ Page 3048 ]

didn't tell them, the Minister of Mines didn't tell them, who told Kaiser?

He had three conversations with Kaiser. He has told us that. And at no time, he said, did he discuss Kaiser's specific coal royalty. He didn't discuss Kaiser's specific coal royalties in general — i.e. they're going to have a review of coal royalties. If Edgar Kaiser asked the minister this question: "Mr. Minister, if you're going to have a review of coal royalties, where does that leave us with respect to the $1 more per ton we expected to pay?" — but we are to believe that Edgar Kaiser did not ask that question. That's what we are to believe, because he didn't discuss Kaiser's specific royalty with Kaiser, right? So we are to believe that Edgar Kaiser did not ask the minister: "Where does that leave us with respect to that $1? "

MR. CHAIRMAN: Hon. Member, may I just interrupt you long enough to remind you that although there is no provision in standing orders to insist on an answer from the minister, there are provisions in the standing orders against tedious repetition. I must draw the member's attention to standing order No. 43 and ask him to proceed to another line of questioning. The line of reasoning you are following now has been directed to the attention of all the members, and I believe we are all aware of the line of reasoning. Proceed with the next line of reasoning and the next series of questions, please.

MR. BARRETT: Mr. Chairman, what I'm trying to find out is this: slowly and painfully we have learned from the minister that he was aware that there was a mining policy by the previous government for a more realistic royalty to be imposed. He was aware that $1 more was to be added to the royalty on April 1. An intervening event took place — that is that the present government got elected — and he had three meetings with Kaiser. In the frame of those three meetings he has told us here in this House that while he was aware that Kaiser can pay more, while he is aware that Kaiser is a low-cost producer, the policy of the additional $1 a ton was not carried through, even though they could pay it — they'd passed the Minister of Human Resources' (Hon. Mr. Vander Zalm's) means test. They could pay it, but they wouldn't be charged it — they've got their shovel already.

He had three meetings with Mr. Edgar Kaiser Jr. He has told us that he discussed in general terms with Mr. Kaiser that they were going to undertake a study on coal royalties, but the minister said to this House that he did not discuss Kaiser's royalty with Kaiser.

Now I ask the following two questions: (1) who told Kaiser they wouldn't have to pay the $1; (2) did not Edgar J. Kaiser ask the minister what effect the new policy would have on the proposed $1 increase? Or, how did Edgar Kaiser, Jr. get the signal that he wasn't going to pay the additional $1? That's all.

It's very simple: who told him that he didn't have to pay the additional $1 while the study was going on?

MR. CHAIRMAN: Hon. Member, would you please take your chair until I read standing order 43, just in case you are not aware of it.

MR. BARRETT: Standing order 43?

MR. CHAIRMAN:

"Mr. Speaker, or the Chairman, after having called the attention of the House or of the committee to the conduct of a member who persists in irrelevance or tedious repetition, either of his own arguments or of the arguments used by other members in debate, may direct him to discontinue his speech, and if the member still continues to speak, Mr. Speaker shall name him, or, if in committee, the Chairman shall report him to the House."

The Chair wishes to be very lenient and, I believe, has proven to be so. But I do direct to your attention the provisions of standing order 43 and must ask you now to follow another line of reasoning in your questions.

MR. BARRETT: Mr. Chairman, I appreciate your bringing that rule to my attention. Indeed, in fact I have not been contradicting that rule but have been eliciting information step by step from the minister. The problem has been the delay in answering the question. But the questions have not been refused to be answered — not all of them. Some of them have been answered. But the unfortunate thing is, like all other debates in a democratic society, when the answers are only half-answers it elicits further questions. That is really what I am pursuing — further questions.

HON. MR. BENNETT: Hypothetical.

MR. BARRETT: It is not a hypothetical question to ask who ordered Kaiser not to pay the additional dollar.

AN HON. MEMBER: You asked that question.

MR. BARRETT: Yes, I did. Thank you, thank you. Write it down, because I don't know if you were the one.

Now the question I ask the minister — a new question which he has not directed himself to, and non-repetitive — is: did Henry...or Edgar — you can't talk to Henry — did Edgar Kaiser, Jr. in those three conversations with the minister ask the

[ Page 3049 ]

minister: "What is the status of the additional $1-a-ton royalty that I expected to pay on April 1? Will I be expected to pay it or won't I be expected to pay it"? Does the minister, through you, Mr. Chairman, recall whether or not Mr. Edgar Kaiser asked that question during the occasion of the three meetings he had with Edgar Kaiser, Jr.?

HON. MR. WATERLAND: The first question, Mr. Chairman: who advised Kaiser Resources not to pay the additional $1 royalty? Kaiser Resources was never assessed the extra $1 royalty by the previous government; it was never assessed by this government. Although discussions were had with the previous government, no one ever told them to pay a royalty, nor did we.

What is the status of what?

MR. LEA: Can't you read Pat's writing?

Interjections.

HON. MR. WATERLAND: No. What did we discuss? Mr. Kaiser asked....

Interjections.

HON. MR. WATERLAND: Did Mr. Kaiser ask: "What is the status of the $1?"? No, Mr. Kaiser did not ask such a question. One of the things that was mentioned in our discussions, and they were primarily based on other subjects, was the fact that we were going to be reviewing coal royalties, and that is exactly what we are doing. Mr. Kaiser was never assessed the royalty by that previous government. He was never assessed it by this government. He was never sent a bill for the royalty, so he never paid it.

MR. BARRETT: Thank you very much. So that I will not be confused, the answer is, as I understand it, that Mr. Edgar Kaiser did not ask the minister whether or not the new government would be asking him to pay the additional $1 that the former government expected to charge them.

SOME HON. MEMBERS: There was no dollar.

MR. CHAIRMAN: Order, please.

Interjections.

MR. CHAIRMAN: Order, please.

Interjections.

AN HON. MEMBER: Don't talk to the press gallery!

Interjections.

MR. CHAIRMAN: Order, please, hon. members! The member for Vancouver East has the floor. Please proceed.

MR. BARRETT: Now you sea gulls just sit there for a little while, through you, Mr. Chairman.

Interjections.

MR. BARRETT: I never told anybody to sell their car and head for Hawaii.

AN HON. MEMBER: Oh, oh!

MR. BARRETT: I didn't do that. I never knew an Attorney-General that was above politics.

HON. G.B. GARDOM (Attorney-General): What did you tell the egg producers? Remember that?

MR. BARRETT: Oh, yes!

SOME HON. MEMBERS: Aha!

MR. BARRETT: Who told Edgar Kaiser that he didn't have to pay the $1? Isn't it interesting how they all flutter?

MR. CHAIRMAN: Order, please, Hon. Member.

MR. BARRETT: Oh, flutter, flutter, flutter, flutter!

Interjections.

MR. CHAIRMAN: Order!

MR. BARRETT: Ohhhhhhhhh!

MR. CHAIRMAN: Order!

MR. BARRETT: They come in and they're trying to defend the minister. The minister says that the dollar was not assessed — that is correct. That is correct. The $1 was not assessed; Mr. Edgar Kaiser...

Interjections.

MR. CHAIRMAN: Hon. Member....

MR. BARRETT: ...was aware that the $1 was going to be assessed.

MR. CHAIRMAN: Order, please! May I interrupt the proceedings of the House just to remind the

[ Page 3050 ]

House that it is 15 minutes of 6 and at this time usually we have an influx of attendance in the House, and it is usually a little more difficult to maintain order. If we could have just a little better participation on behalf of everyone, it might make it less difficult for the Chair.

MR. BARRETT: Yes, thank you.

Interjections.

MR. CHAIRMAN: Order, please. The Leader of the Opposition.

MR. BARRETT: Mr. Chairman, I appreciate....

AN HON. MEMBER: You need a new leader, Bill.

MR. BARRETT: I appreciate....

Interjections.

MR. CHAIRMAN: Order, please!

Interjections.

MR. CHAIRMAN: Hon. members, order, please! The Leader of the Opposition has the floor. Order!

MR. BARRETT: Thank you, Mr. Chairman, for your protection.

The Minister of Mines has now told us that the $1 was never assessed. That is correct — the $1 was going to be assessed. That is correct; we both understand that. Kaiser was expecting to pay the $1.

Mr. Minister, I ask you again: did Kaiser receive a message that the policy of the additional dollar was no longer going to be carried through, or was it just a silent understanding and it wasn't raised at all? Mr. Chairman, I think I am entitled to ask that.

It is my understanding, through you, Mr. Chairman, that one of the meetings between the minister and Mr. Kaiser lasted for just under three hours. Is that correct? It was a press report that the meeting lasted close to three hours. Is that incorrect?

How long was the longest meeting? Was it three hours as the press reported?

Interjection.

MR. BARRETT: You don't know? Through you, Mr. Chairman, the minister says he doesn't recall how long it was that he met with....

Interjection.

MR. CHAIRMAN: Order, please. The Leader of the Opposition has the floor. Anyone wishing to make a speech needs to rise in his place and call for the attention of the Chair.

MR. BARRETT: Mr. Chairman, it is no surprise that the Mines minister meets with the mines. He is the Minister of Mines. He said he wanted to get elected to take care of the mines. All I'm asking is what took place in the conversations. Did they just sit there and look at each other? Does it happen by mental telepathy because they are afraid secret police will come barging in the room and shoot him with their guns?

Mr. Chairman, the minister met on three occasions with Edgar Kaiser, Jr. This deals with revenue to the Crown to be spent on the people of this province. When the people have an opportunity through their legislators to assess whether or not there is a proper return from the resources, there is an opportunity during the estimates to ask the minister specific questions.

Mr. Chairman, what we are really trying to find out here is why the policy of this government after the minister states that he was aware that there was going to be an additional dollar, that the company can pay the dollar now, and that they are a low-cost producer in your terms.... That is what you have said — the company can pay the dollar now. You weren't here, Mr. Premier — that's what he said. He said that they could pay the dollar now.

HON. MR. BENNETT: I wasn't listening.

MR. BARRETT: Oh, you were just nodding off. Excuse me. I'm sorry to interrupt your reveries. I'm sorry, through you, Mr. Chairman.

Interjection.

MR. BARRETT: That's right — Winken, Blinken and Nod, all in one minister.

Mr. Chairman, I want to ask the minister why he isn't asking Kaiser to pay the dollar until the study is done when he acknowledges the fact that they can pay it. Why shouldn't they pay it now? Why can't they pay it now? What, in your opinion, prohibits them from paying the additional dollar a ton?

MR. CHAIRMAN: Please proceed.

MR. BARRETT: No, I'm waiting for the minister. He is just consulting with his deputy.

MR. CHAIRMAN: Please proceed.

MR. BARRETT: Did you wish to answer, Mr. Minister? Doe he care to answer?

Mr. Chairman, once again I put the question to the minister: could he please tell the House and the

[ Page 3051 ]

people of this province why, in the interim, while he's waiting for the report on the new coal royalty, Kaiser should not be assessed the additional dollar when, in his own words, he has said that they are a low-cost producer and they can afford to pay? Why shouldn't they pay? That's a simple question.

MR. KING: Mr. Chairman, I'm curious about this Kaiser situation also. I wonder about the relationship between this government and its predecessor Social Credit government and Kaiser Resources. I wonder if the Minister of Mines knows anything about the plan and the aspiration of the Kaiser Company in collaboration with the Burlington Northern Railway to transport coal via our lines south through the United States.

Interjection.

MR. KING: That's the one my friend doesn't like to hear.

MR. CHAIRMAN: Order, please, Hon. Member. On vote 130, please.

MR. KING: I just wonder if, in that three-hour meeting that the Minister of Mines had with Edgar Kaiser, Jr., they discussed Mr. Kaiser's interest in the port facilities south of the border that could accommodate coal shipments from the southeast part of British Columbia. When we remember that Mr. Kaiser was the same interest that was awarded the contract to construct the High Arrow Dam on the Columbia River chain in the late Fifties or early Sixties by the former Social Credit government, a project that was subsequently overwritten by the federal authority in this nation, we see that there has been a long, continuing relationship between the Social Credit Party and Kaiser Resources.

I could never understand, Mr. Chairman, why the former government was prepared to let a corporation such as Kaiser come in and develop our hydro-electric resources, come into British Columbia and borrow money on our money market to develop their coal mine in southeastern British Columbia...

MR. LEA: They thought Kaiser represented Hitler.

MR. KING: ...and then embrace and allow a plot to transport and ship all that coal through a foreign country, to the detriment of the people of British Columbia, with tremendous loss of jobs involved. I wonder what thread this is — this continuing relationship over all these years that will give Kaiser Resources this kind of treatment, this ear that the government has extended to Kaiser. I wonder how it is that the former Social Credit government was prepared to allow this corporation to come in and develop our dam on the Columbia River chain. That was the first proposal for the development of hydro electricity on the Columbia River chain. Then there was the coal situation. I wonder if there's some understanding between the Social Credit Party and Kaiser Resources.

I'd like the minister to elaborate a bit more in terms of what was discussed at that three-hour meeting. I wonder if there are any other projects under active discussion between the Minister of Mines and Edgar J. Kaiser, Jr., regarding either mining or perhaps some other developments in the province.

Interjections.

MR. KING: Mr. Chairman, you're absolutely right — it's becoming a very noisy House. I have the distinct impression and the unnerving impression that no one's listening to me, and that offends me.

The minister's obscured from view altogether; he's hiding behind the large Attorney-General (Hon. Mr. Gardom.) I like to see his face when I ask him these questions. Sometimes by the twitches, facial expressions, whims and quirks, I'm able to get some kind of an indication of what his response might be.

HON. MR. GARDOM: Was that a whim or a quirk?

MR. KING: Yes, quirk. Yes, there are a lot of quirks on that side. They're not all in the eyebrows, Mr. Chairman.

I'm honestly curious about this relationship, because it's of grave concern to my particular riding.

HON. D.M. PHILLIPS (Minister of Economic Development): The previous speaker wasn't honest!

MR. KING: Mr. Chairman, we'll try to ignore the Minister of Economic Development.

Interjections.

MR. KING: I do hope that the minister will be prepared to answer some of the questions we have put to him. I hope that he'll be prepared to expand a bit on the precise matters that were discussed with Mr. Kaiser at the three-hour meeting.

The House resumed; Mr. Speaker in the chair.

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

HON. MRS. McCARTHY: Mr. Speaker, by leave, second reading of Bill 50,, a private bill.

Leave granted.

[ Page 3052 ]

AN ACT TO INCORPORATE THE BISHOP
OF THE UKRAINIAN CATHOLIC EPARCHY OF
NEW WESTMINSTER AND HIS SUCCESSORS
IN OFFICE A CORPORATION SOLE

MR. W.G. STRONGMAN (Vancouver South): I think I'm being applauded because most of my speeches are very short.

Interjections.

MR. STRONGMAN: This is a very inconspicuous bill, one that is merely the formation of a corporation to represent a segment of a much larger parish that is created throughout western Canada. The Ukrainian Catholic Church has now created a new diocese and they would like to take the assets from part of the old diocese and include them in the new Ukrainian Catholic Episcopal Corporation of Western Canada. I would ask that the members pass this. We went through the private bills committee and there is one small amendment that I think will satisfy the House. I now move second reading.

Motion approved.

Bill 50, An Act to Incorporate the Bishop of the Ukrainian Catholic Eparchy of New Westminster and His Successors in Office a Corporation Sole, read a second time and referred to Committee of the Whole House for consideration at the next sitting after today.

HON. MRS. McCARTHY: Second reading of Bill 51, Mr. Speaker.

AN ACT TO INCORPORATE THE BRITISH
COLUMBIA ASSOCIATION OF COLLEGES

MRS. P.J. JORDAN (North Okanagan): Mr. Speaker, this Act, as you mentioned, intituled the British Columbia Association of Colleges Incorporation Act, has been fully examined through the legislative committee dealing with private bills. Hon. members from all sides of the House have considered its principle and its contents and there was no contest in committee. Therefore I move second reading.

Motion approved.

Bill 51, An Act to Incorporate the British Columbia Association of Colleges, read a second time and referred to Committee of the Whole House for consideration at the next sitting after today.

HON. MRS. McCARTHY: Second reading of Bill 52, Mr. Speaker.

VANCOUVER STOCK EXCHANGE ACT, 1907
(AMENDMENT)

MR. J.R. CHABOT (Columbia River): Mr. Speaker, I move second reading of Bill 52.

Mr. Kerster moves adjournment of the debate.

Motion approved.

Hon. Mrs. McCarthy moves adjournment of the House.

Motion approved.

The House adjourned at 6:03 p.m.