[ Page 765 ]

CONTENTS

Statement

Review of procedures in question period. Mr. Speaker — 765

Routine proceedings

Oral questions

Handicapped persons' allowance. Hon. Mr. Vander Zalm answers — 766

Royal commission on BCR operations. Mr. King — 766

Continuance of wiretaps. Mr. Wallace — 768

Committee of Supply: Ministry of Economic Development estimates

On vote 79.

Hon. Mr. Phillips — 769

Mr. Macdonald — 769

Mr. Wallace — 774

Hon. Mr. Phillips — 777

Mr. Macdonald — 779

Hon. Mr. Phillips — 780

Mr. Gibson — 782

Division on the motion that the committee rise and report progress — 782

Mr. Gibson — 782

Hon. Mr. Phillips — 785

Mr. Lea — 789

Hon. Mr. Phillips — 790

Mr. Nicolson — 791

Mr. Lauk — 791

Mr. Nicolson — 793

Mr. Barber — 794

Hon. Mr. Phillips — 797

WEDNESDAY, FEBRUARY 9, 1977

The House met at 2 p.m.

Prayers.

HON. G.M. McCARTHY (Provincial Secretary and Minister of Travel Industry): Mr. Speaker, I am pleased to present to the House today some visitors from the United States of America. They are here to view the city of Victoria and the province of British Columbia in anticipation of a post-convention tour that they will be making after their 1977 American Hotel and Motel Association convention that will convene in Seattle, Washington, in October, 1977, with an anticipated attendance of 1,000 persons. Seated in the gallery today are the representatives of the association, who are going to be viewing this most blessed part of the North American continent with a view to holding a post-convention meeting here in the city of Victoria. I'd like to introduce to the House Mr. and Mrs. Neil Messick, Jr., James J. Groome, and Katherine Martin, all of the American Hotel and Motel Association and Mr. Jack Rayburn, president of the Washington State Hotel and Motel Association. I know the House will want to give them a warm and gracious welcome.

HON. J.A. NIELSEN (Minister of Environment): Mr. Speaker, I'd like to advise the House of an accomplishment of a team of lady curlers from the Richmond Winter Club who have the distinction of being the winners of the 1976 B.C. Ladies Curling Championships. The team is made up of the skip, Heather Kerr of Richmond, Una Goodyear of Richmond, Shirley Snihur of Delta, and Bernice McCallan of Vancouver. I'd like the House to congratulate these ladies and wish them the best of luck in the national finals in Halifax on February 27.

MR. C.M. SHELFORD (Skeena): Mr. Speaker, I would like the House to welcome a good friend of mine and a former member of the Legislature — a hard-working member — Isabel Dawson from Mackenzie.

MR. SPEAKER: Hon. members, if I may beg your indulgence for a few moments before we start the oral question period today

Interjections.

MR. SPEAKER: It is not being taken from the time of the question period, and that is why I beg your indulgence now, rather than during the question period.

I thought it would be good for the benefit of all of the members of the House if I were to review the procedures within our oral question period, as laid out by a committee of the House that met on legislative procedures and practices some time ago. As a matter of fact, in 1973 they tabled a report with recommendations concerning, first of all, the oral question period.

The first suggestion and proposal was to have an oral question period with notice being posted with the office of the Clerk, and the question being posted with the office of the Clerk. The second proposal was to have an oral question period without notice commencing on each day of the session, except Friday, the questions being on urgent and important matters.

Following the tabling of that report, the Legislature adopted a committee report by the chairman. I would like to read the content of that report. It is brief:

"Your Select, — Standing Committee on Standing Orders and Private Bills begs leave to report as follows:

"Your committee has considered the matter of an oral question period contained in recommendation (1), proposal (2) of Mr. Speaker's first report made pursuant to the Legislative Procedure and Practice Inquiry Act, and recommends as follows:

"That the reference in standing order 25 to 'questions put by members' be interpreted by Mr. Speaker as permitting a 15-minute oral question period for urgent and important questions without notice, commencing at the opening of each day's session, except Fridays.

"Your committee further recommends that the following provision be applied to the oral question period:

"(1) Only questions considered by the Speaker to be urgent and important shall be permitted, and his decision shall be final;

"(2) No debate shall be permitted during questions. Supplementary questions from members may be allowed by permission of Mr. Speaker;

"(3) Question period will be dispensed with on Fridays.

"All of which is respectfully submitted,

"G.V. Lauk,

"Chairman."

The report was read and received, the rules were suspended and the report was adopted.

That basically explains the procedure within the oral question period and I think you can appreciate the fact that, without notice, it requires immediate decisions on the part of the Chair as to whether the question is urgent and important and, in fact, whether it's in order with respect to Beauchesne and the other rules of the Legislature. I just make this comment for the refreshment of the memories of all

[ Page 766 ]

of the members of the House and I hope that we'll keep that in mind in asking questions.

MR. G.V. LAUK (Vancouver Centre): As I recall, the hon. member for Columbia River (Hon. Mr. Chabot) was on that committee and he submitted a minority report asking for 40 minutes. I wish now to suggest that if the hon. member for Columbia River wishes to submit that kind of resolution this side of the House will support it. We've had a change of heart.

Oral questions

HANDICAPPED PERSONS' ALLOWANCE

HON. W.N. VANDER ZALM (Minister of Human Resources): Mr. Speaker, I would like to provide a response to an oral question from Mr. Gibson, the member for North Vancouver-Capilano, regarding cost-sharing for handicapped persons' income assistance.

AN HON. MEMBER: Table it.

MR. SPEAKER: Order, please.

HON. MR. VANDER ZALM: On October 1, 1976, the Ministry of Human Resources increased income assistance rates for specific categories of recipients. This naturally increased cost-sharing for income assistance in all programmes that come under the same financial umbrella. Total anticipated revenue due to the change is approximately $5 million, which is received in general revenue of the province.

MR. G.F. GIBSON (North Vancouver-Capilano): Mr. Speaker, I don't really think the minister has answered my question. My question at that time was why the $22.50 additional cost-sharing in respect of handicapped persons had not been passed on to them. That was my question. Why was that not passed on?

HON. MR. VANDER ZALM: Well, Mr. Speaker, as the rates are adjusted for whatever category, be it handicapped people or families or single-parent families or single people, then there may be a change in revenue due to the province from the federal government, but I don't think we should adjust our rates on the basis of what revenue comes to what category. I think instead we should assess the needs and then take the whole of the revenues, along with what amount is provided in the budget, and provide the increases according to need. All of these programmes are constantly being reviewed with a view to according, through the legislation, the greatest help to those in need.

MR. GIBSON: I even may take it then, may I, Mr. Minister, that you are confirming that you received an additional $22.50 per month in respect of handicapped persons and did not pass it on to them? Is that right?

MS. R. BROWN (Vancouver-Burrard): You didn't pass it on.

HON. MR. VANDER ZALM: The answer to the question, Mr. Speaker, is that whenever rates are adjusted, there are additional revenues received, and they are received in bulk according to the billing provided to the federal government by the province. It's not fair to say that it wasn't passed on, therefore creating the impression as if something was being withheld from a particular category of people.

I would suggest to the member that, again, all of the programmes are being reviewed. Specifically with regard to the handicapped, we've had a review going on. We, incidentally, asked an organization in Vancouver being funded through the ministry to provide us with their recommendations as to how we could best provide greater benefits in the long run to those people. Since we have not received this input from the group that we had requested the information from, we had ourselves proceeded with this study. I can assure the member and all members on the other side that British Columbia will have the best programme for handicapped people on the whole continent.

ROYAL COMMISSION ON BCR OPERATIONS

MR. W.S. KING (Revelstoke-Slocan): A question to the Attorney-General: in view of the fact that Dave Chapman, a member of the royal commission on the B.C. Railway, told CJOR News last night that (1) he doubts that the MEL Paving court case will be dealt with by the commission, and (2) he does not expect the commission will call witnesses involved in the MEL case, and in view of the fact that another member of the commission, Mr. Syd Welsh, has admitted he is a member of the Social Credit Party, will the government now amend and clarify the order setting up the commission so that terms of reference specifically include the MEL Paving case?

HON. G.B. GARDOM, (Attorney-General): This is a question, Mr. Speaker, that was raised essentially yesterday, and I would like to respond to it with some degree of depth.

HON. MR. GARDOM: I don't think there is really the requirement to do that, my dear colleague. We've already filed it and I'm sure that the members of the government have read the order-in-council, but it appears that the official opposition has not.

[ Page 767 ]

Now it is abundantly clear, Mr. Member, from the terms of the royal commission that the government was desirous that there be a full and complete inquiry into the overall operations of the B.C. Railway. The commission has received extremely wide, broad, encompassing and a general mandate to inquire into all facets of the overall operations of the railway. There is therefore no question, Mr. Member, that the royal commission has sufficient scope to look into all aspects.

It is empowered to fully inquire into the overall operation of the railway and, as I said yesterday — perhaps somewhat an unparliamentary statement — it has the power to consider the complete "bag." This certainly encompasses a great deal more than engines and cars and cabooses running from point A to point B. There is scope, Mr. Member, under the commission to consider the matters that have been raised in this House.

I must stipulate, though, that the government will not and cannot dictate to this independent commission its definition of its powers, procedures, modus operandi and which matters will come before it, or when, or in what manner. That is the job and that is the responsibility of the commission. But I'm sure every member here will agree that the royal commission will not be unmindful of the many issues and concerns that present themselves, of the job that they will have to perform and of the large responsibility that they will have to discharge. Further, I'm sure that the commission will be open to receive comments, recommendations and briefs, and that it will solicit expertise — technical, administrative and professional. It has full and complete power to hold meetings, to summon and compel attendance of witnesses, to call for the production of documents, and has the responsibility to report to this Legislature.

So I'd say in short and in summary, the powers within the terms of this commission are abundant to cover all of the matters and it is not proper for the government to now start spelling additional specifics into the order. The broad powers permit broad inquiry. The powers are extremely broad, and we as government would naturally assume that the commission inquiry will be similarly broad.

MR. KING: It's painful to see the wild thrashing of a drowning man, Mr. Speaker.

Mr. Speaker, I wonder if the Attorney-General would answer the question that I posed to him, in light of the fact that a member of that commission has indicated that there is no intention to study the MEL Paving court case. Will the government consider specifically developing within the terms of reference the authority to do so? Secondly, does the Attorney-General not think it is improper to appoint a member of the Social Credit Party to an allegedly impartial royal commission set up to study the government's administration of a Crown corporation?

HON. MR. GARDOM: Again, Mr. Member, it is not incumbent upon me to comment upon your interpretation of a remark made by a member of the commission. I don't know what the remark was. I haven't the foggiest idea. That's point one.

Point two: with every respect to this hon. member, I think it's a somewhat scurrilous suggestion to say in a democratic society that by virtue of the fact that an individual happens to belong to a particular political party he will not perform his proper duty.

MR. KING: Mr. Speaker, I'm interested in the Attorney-General's remarks with respect to the administration of justice. If there happen to be political labels on that administration of justice that he is content with, perhaps he could have a word with the Minister of Environment (Hon. Mr. Nielsen) and tell him about it.

MR. SPEAKER: Order, please.

MR. KING: But I wish he would answer the question: will the government or will it not amend the terms of reference requiring the commission to specifically examine the MEL Paving case and to call witnesses to give testimony?

HON. MR. GARDOM: The terms of reference, Mr. Member, are sufficiently wide for the commission to do just that, as you know.

MR. LAUK: On a supplementary, Mr. Speaker, to the Attorney-General, I'm instructed that he met with the proposed commissioners, as they then were last week. Could the Attorney-General inform the House whether or not he discussed the terms of reference outlined in the order-in-council with those gentlemen at that time? If so, did it include a discussion of the out-of-court settlement in the MEL Paving case?

HON. MR. GARDOM: Would the hon. member be kind enough to inform me of his source?

SOME HON. MEMBERS: Oh, oh!

MS. BROWN: You can't ask questions! You're here to answer!

MR. LAUK: I will provide you with the source now, Mr. Speaker, through you to the Attorney-General. I saw the gentlemen going up to your office — Mr. Justice McKenzie and the two other commissioners. So could the Attorney-General

[ Page 768 ]

inform this House as to what was discussed at that time?

HON. MR. GARDOM: Which other two commissioners did the hon. member see coming to my office?

SOME HON. MEMBERS: Oh, oh!

MR. LAUK: Did the hon. Attorney-General discuss with Mr. Justice McKenzie the terms of reference that were outlined in the order-in-council? If so, did it include a discussion of the out-of-court settlement in the MEL Paving case?

HON. MR. GARDOM: First, the hon. member claims to have seen three gentlemen coming to my office. I assume, Mr. Speaker, that he is referring to the three named commissioners. Is that correct?

Interjections.

MR. SPEAKER: Order, please.

HON. MR. GARDOM: I would tend to think that the hon. member should have some degree of social and moral responsibility when he poses a question such as that, first of all.

MR. LAUK: I know Mr. Justice McKenzie when I see him.

AN HON. MEMBER: He's sided against you enough times!

HON. MR. GARDOM: A few moments ago the hon. member indicated that I had meetings last week with these three individuals. Then the hon. member stated that the three individuals came to my office. Point one: I did not have any meetings with any one of the three individuals last week...

MR. KING: Did you this week?

HON.MR.GARDOM: ...so I wonder where the hon. member solicited that information. Perhaps he should apologize. Point two: The hon. member stated that these three individuals have come to my office. That is totally incorrect and false. I did see Mr. Justice McKenzie, as one has to do in the appropriate course when you're looking for a commissioner and you are requesting, first of all, the permission of the Chief Justice of the Supreme Court of British Columbia to relinquish a judge. Yes, I did have a discussion with Mr. Justice McKenzie informing him of the general tenor of the commission only. Until such time as Mr. Justice McKenzie received the exact order-in-council, I take it he was unaware of the essential specifics.

Really and truly, Mr. Member, I would tend to think you should do a little more in this House as an elected representative than try this kind of witch hunting.

MR. SPEAKER: Order, please.

MR. GIBSON: Mr. Speaker, I want to ask a supplementary to the Attorney-General. He talks about the broad powers of the commission and assumes that those are sufficient to ensure that the MEL Paving and other such cases will be investigated.

I ask the Attorney-General what has happened to his sense of history. Does he not recall that the Sloan commission of 1955 had complete powers to look into the forest industry and refused to hear the Sommers' case?

MR. SPEAKER: Hon. member, the hon. member for North Vancouver–Capilano did not state a question. He stated, in his opinion, an answer to a question. Yet you were given the opportunity of taking the floor, not on the basis of a question.

MR. A.B. MACDONALD (Vancouver East): Mr. Speaker, a supplementary to the Attorney-General: I ask the Attorney-General specifically, as these so-called broad powers cover general operating methods and tendering practices of the BCR, if he does not agree, as a lawyer, that that would not enable the commission to consider particular cases dating back to 1968, to 1972, and particularly the underestimation and the conflicting testimony surrounding MEL Paving. They're not included.

HON. MR. GARDOM: I would tend to think, Mr. Speaker, there must be some rule in parliamentary authority to prevent constant repetition of the same question on the same basis. But to the former Attorney-General: it doesn't say "method" does it? Would you just read about the overall operation? Now the former Attorney-General thinks this talks about, I suppose, driving spikes into rail ties. I can assure him it's more than that.

CONTINUANCE OF WIRETAPS

MR. G.S. WALLACE (Oak Bay): Mr. Speaker, I'd like to change the subject...

HON. MR. GARDOM: Ohhh!

MR. WALLACE: ...only temporarily — not the minister. This is regarding wiretapping and is addressed to the Attorney-General. Can he confirm that cases are on record where the wiretap was left in place after the arrest of the suspect so that

[ Page 769 ]

conversations with the defence lawyer could be monitored? If so, what steps has the Attorney-General taken to have this practice stopped?

HON. MR. GARDOM: I will have to take the question as notice, hon. member.

Hon. Mr. McGeer files answers to questions. (See appendix.)

MR. KING: On a point of order, Mr. Speaker, I appreciate your review of the rules surrounding question period for the House and I would like to offer and suggest to you that it's possible for ministers, particularly when they take questions as notice, to file with the House their response when it's lengthy at all. That has been the custom in the House over the past number of years, and I think that, obviously, with a 15-minute question period, if lengthy dissertations are given and argumentative statements made by ministers, that detracts from the opportunity the opposition has to file their questions. Therefore, Mr. Speaker, I would hope that you would suggest to the cabinet benches that they consider tabling these long-winded responses out of respect for question period.

Further, Mr. Speaker, with respect to your review of the committee which established the question period, I would suggest to you that it might be propitious to ask the same committee to review the rules again. After all, the form of this chamber has changed a great deal since that question period was established, both in terms of the numbers and so on, and I think that it's only reasonable to review from time to time the general guidelines surrounding question period so that we're assured there is a fair division of questioning opportunity in terms of the numerical strength of the opposition. I think that would be propitious at this time.

MR. SPEAKER: Thank you, hon. member. Your points are well taken and it is a matter of concern to me on an ongoing basis.

Orders of the day.

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

ESTIMATES: MINISTRY
OF ECONOMIC DEVELOPMENT
(continued)

On vote 79: minister's office, $141,324 — continued.

HON. D.M. PHILLIPS (Minister of Economic Development): Mr. Chairman, yesterday afternoon during the questioning on the railway, with regard to the answer from the member for North Vancouver–Capilano (Mr. Gibson), I have the projected loss that I will give at the same time.

As of December 31, 1976, the net loss was $53,245,000, and that is an unaudited statement. Mr. Chairman, the projected loss for the year is in the vicinity of $69 million. The year has been interpreted as the year 1976, and that $69 million projected loss is for the year 1977. The projected loss for the railway for the year 1976 in the amount of $53,245,000 is correct. As I say, it's an unaudited statement.

AN HON. MEMBER: Is it for nine months?

HON. MR. PHILLIPS: Just let me continue, Mr. Member. B.C. Railway's fiscal year ends on the nearest Friday to December 31 of any year and, in his instance, December 31, 1976, happened to be a Friday and was the fiscal year-end of the railway.

The latter figure of $69 million is the projected loss for 1977. I'm sorry if that was misinterpreted. I should have stated at the time that when I said the year, I meant the year ahead — 1977.

MR. MACDONALD: Mr. Chairman, I have a few questions to the minister, and the first one will cause him no great expense of time in this chamber but it is matter of great importance to the minister and to the public.

I don't know if the minister reads the newspaper, but in the paper of yesterday, February 8, there was the settlement of a libel action. You may say: "What's that got to do with this minister?" It has a lot to do with this minister. It was the case involving Dunhill Corporation.

On February 20, 1974, there was a very strange duet going on in the province with Mr. Bannerman on the radio station engaged in the singing, along with the minister, as part of the duet, singing under the power of legislative immunity. They were both saying precisely the same thing about allegations which have been found false and libelous in the Supreme Court of British Columbia after the trial of the action on Dunhill Corporation. I won't give all of what the minister told this House, but it's all in Hansard. On February 20, 1974, he said this:

"...as a result of my coming into possession of a record of shared transactions which establishes a prima facie case that unreported insider trading took place with respect to the government takeover of DunhillCorporation, which I will make available to this House. As these transfers are not recorded under the Securities Act, it becomes evident that this House must immediately take action to cause the fullest investigation of stock market activities by this

[ Page 770 ]

government to take place."

And then on the second page, about Dunhill:

"Mr. Speaker, we now learn that prior to the order-in-council being passed there could have been leaks of the proposed order-in-council to certain persons with privileged information to make windfall profits at the expense of the taxpayers of British Columbia."

Down a little lower, Mr. Speaker:

"I ask the House this afternoon: was there a leak of information? Was there incompetence in the Minister of Housing? Was the Minister of Finance incompetent? Was there dishonesty in this province? That's what I want to know."

The minister then goes on to say:

"I would suggest that we are dealing with a very, very, very serious matter this afternoon. As a representative of the taxpayers of this great province, if indeed this did happen, I intend to lay before the House certain facts which lead me to believe that indeed it did happen."

Do you remember the Jones case, Mr. Chairman? You don't have to come right out and say that there's dishonesty. You can leave the suggestion, and it is libelous. All that the former Premier said about Mr. Jones was, "I could speak about Mr. Jones but I'm not going to," and it was subject to damages in court. What the minister was saying was clearly libelous — he knows it; we know it — and injurious. It served his political interest, but let that go by the board, eh?

In the settlement of the damage action, you know, this was going on. He was saying exactly the same thing. The defendants in the damage action have now had to pay damages according to what the court was told was suitable and make an apology in court. This member was saying the same thing under legislative immunity.

In the report of the settlement of the action, the Vancouver Province talks about the sad position that Mr. Bannerman found himself in. It's funny how many little people — well, "little" comparatively — who are not under the protection of that umbrella fall. People lose their jobs under this minister; people are subject to damages for doing the very same thing that the minister is doing. "Bannerman also stated that there had been a ripoff in that the government had paid an excessive price for the shares." That is exactly what this minister was also saying at that time. Mr. McEachern says: "I am instructed, and I understand my friend, the counsel for Bannerman on the radio station, now agrees that these statements and suggestions about the four plaintiffs are wholly and totally false."

MR. LAUK: Shocking!

MR. MACDONALD: McEachern went on to say: "Bannerman's allegation that there was a ripoff in the price paid by the government, that the price was excessive, is disproved by the subsequent profit performance of Dunhill as reflected in its annual financial statements, which are a matter of public record." He described the broadcasts as "an unjustified attack on the Dunhill officials." That is precisely what, in addition to attacking the minister and the government, this minister did in 1974. They were prepared to go to trial but had agreed to accept the apology as given in court along with a financial settlement in damages.

J.B. Clarke, who was the solicitor for Bannerman on the radio station, told Mr. Justice Gould that "the defendants unreservedly withdraw and apologize for any imputations which may have been cast on their characters and reputations as a result of the broadcast."

I say, Mr. Chairman, the principle calumniator of February 20, 1974, leading up to February 25, is the minister. I call upon that minister not to pay damages, as the other people who have suffered in this have done, but to stand up in this House and make an apology. Two little words — that's all we're asking of a minister who has got the protection of his office and legislative immunity.

Interjection.

MR. MACDONALD: Mr. Chairman, I listen to that member down there, and if he says there is any statement of mine that's been made outside of this House, I'd like to know what it is.

HON. J.R. CHABOT (Minister of Mines and Petroleum Resources): Yes, the MEL Paving case.

MR. MACDONALD: What did I suggest about MEL Paving?

HON. MR. CHABOT: Criminal fraud!

MR. MACDONALD: I did not!

HON. MR. CHABOT: You did so!

MR. MACDONALD: I did not! Quote the words! Mr. Chairman, call that wild minister to order! He doesn't know what he's talking about. He's talking through the top of his head. He goes up and down the province of British Columbia. Quote the words, Mr. Minister. If I've said something that....

Interjection.

MR. MACDONALD: Never, never, never! That's exactly what I didn't say!

HON. MR. CHABOT: Criminal fraud.

[ Page 771 ]

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

MR. MACDONALD: You don't know what you're talking about.

MR. CHAIRMAN: Order, please.

MR. MACDONALD: That member is poorly briefed.

MR. CHAIRMAN: The first member for Vancouver East has the floor. Hon. minister, may I ask you please to refrain yourself from interrupting a member who has the floor. Please proceed.

MR. MACDONALD: I hope the minister has got his pencil out, because I'm asking in all seriousness that he stand up in this House and simply apologize for the calumny that you, in that famous duet, were also heaping upon those defendants and other persons — allegations which are now proved to be libelous, slanderous, and false. So that is my first question. I hope the minister has got his pencil out.

Possibly I could sit down and have that answered, and then I have some other questions for the minister. Would you like to answer that one now?

Do you prefer I carry on? You don't know what the other questions are, and yet you prefer I carry on.

MR. CHAIRMAN: Please proceed now, Mr. Member.

MR. MACDONALD: Okay, because I don't want to lose my place in this debate.

The second question involves the famous press release which the Minister of Economic Development issued to the press on August 11, 1976, announcing the construction of a $100-million, 90-mile pipeline into the Grizzly Valley. My first question is: why did the Minister of Economic Development make that announcement? He wasn't a director of BCPC. The announcement was the thing that helped those shares to rise. You might as well have been shilling for the shares of Quasar Petroleum when you made that announcement, Mr. Minister, because you know that it put into their bank, in the added stock value, some $20 million. The whole sequence of events, based upon four million shares outstanding, and a rise during 1976, particularly the latter part, doubled those shares. They went up about $5 on the average — which is $20 million — most of it to American shareholders.

The minister had no business making that announcement. When we announced the pipeline extention into Helmet.... No, I shouldn't say "announced" because I deliberately didn't do that. I was the minister of energy at that time. We were very careful not to assist those on the stock market to profit out of a public announcement of that kind. Just going back for a minute, on the Helmet one, where we did make an advance to Atkinson Petroleum, we enjoined that it was confidential and quiet, and that there should be no political announcements, for the obvious reason that if you announce a development of that kind, as the minister did on August 11, you are directly helping the private shareholders to make a windfall profit. It was highly improper for this minister, who isn't even a member of the board of directors of BCPC, to make a Gabriel's horn announcement about this development. That directly fed money into the pockets of the private shareholders.

What was the minister's interest in the Quasar Petroleum corporation? Was it a new-found love that's in his own riding? Is it a new-found interest in the Quasar Petroleum corporation? Not exactly.

In the palmy days of 1973, when British Columbia had the best government that it had ever had in the history of this province — and there are people yearning to go back, you know, to a sort of business competence and a bit of honesty.... Well, I withdraw that word. We were square, eh? We were at least square.

This is what the minister, who was then just an opposition member.... He was not a disinterested man insofar as Quasar Petroleum is concerned, or its big daddy, which is the American Quasar Petroleum Company.

On page 181 of Hansard, February 2, 1973, the minister, then an opposition member, was bucking hard for the road. There is a forestry road in there, eh? And he wanted it paved for these people. He said: "Well, you've got the money. You've got the...."

Interjection.

MR. MACDONALD: It's going to be a repetition until the public of this province understands that that minister has got something to be responsible for. Five ordinary employees have been discharged and lost their living, and that minister sits there. When you see five bodies on the floor, Mr. Chairman, you don't need Agatha Christie to answer who's responsible.

MR. CHAIRMAN: I think, hon. member, that with great respect we ought....

MR, MACDONALD: The little people fall.

MR. CHAIRMAN: Order, please.

MR. MACDONALD: Bannerman falls. You don't care, eh?

MR. CHAIRMAN: Order, please!

[ Page 772 ]

MR. MACDONALD: I want to continue my remarks. There is such a thing as ministerial responsibility.

MR. CHAIRMAN: Order, please!

MR. MACDONALD: Please, Mr. Chairman, you have a point. (Laughter.) What is the point?

MR. CHAIRMAN: I think that it would be wise to reconsider some of the remarks being made lest they could be interpreted to be jeopardizing the work of a commission or of an inquiry that is presently in progress. Therefore I would just like to warn the hon. member. Please proceed.

MR. MACDONALD: Mr. Chairman, you know there is a doctrine in parliamentary law and government of ministerial responsibility. That is what I am referring to in no uncertain terms so far as that minister is concerned. I make the point that other people have suffered, and the minister sits there, as large as life, as if he had no responsibility for the fate of these people who have lost their employment. He does have some responsibility.

HON. MR. PHILLIPS: Put a little more enthusiasm into it.

MR. MACDONALD: All right, I have put enthusiasm in, because I'll be quoting the hon. minister. He went on this road.... This was read out, was it?

AN HON. MEMBER: Yes, last week.

MR. MACDONALD: But I want to read it to you again, because in 1973 you were bucking hard for the Quasar Petroleum corporation. You said in Hansard that:

"...we could alleviate this problem very easily by having the Department of Lands, Forests and Water Resources snowplough the road for the winter. They don't have to worry about base because it's frozen hard. At the present time it's a forestry road...."

I also pointed out that he went right to the Premier, bucking for a road into the oil fields of Quasar Petroleum corporation.

"...that any of the civil servants who wanted to go into this area had to write to Victoria to get permission to take their car in through Alberta or hop a plane which is flying into the area, because Quasar Petroleum built a very nice landing site out there."

"And then when I phoned Victoria to try to see the Premier about it...." Now was this read out?

AN HON. MEMBER: Yup.

MR. MACDONALD: I want to ask you, Mr. Minister, whether this was read out last night also. Because on November 1, 1973, well before your announcement on August 11, you were plugging for the Quasar Petroleum corporation. I ask you whether these words were read out last night.

"MR. PHILLIPS: I would like to direct a question to the Minister of Finance. In view of the energy crisis in British Columbia, does the Minister of Finance plan to invest in the Quasar corporation, who have the hottest gas field in British Columbia in the Monkman Pass?"

Interjection.

MR. MACDONALD: I don't know if that was read out last night. But here you are, this member is totally against the government being involved in investing. You fought that. Your B.C. Development Corporation — you said: "Gee, you might be able to invest in a private company with that." You opposed the whole concept. And here you come out and ask that the government invest in Quasar Petroleum in 1973.

Interjection.

MR. MACDONALD: I can't get enthusiastic about it.

AN HON. MEMBER: I guess not.

MR. MACDONALD: Then you come along, and you're not the minister, and you make a big public announcement about this pipeline. And at that time the government gives a $2 million advance through BCPC to the Quasar Petroleum company for what is called testing and recompletion work on Quasar's existing Grizzly Valley wells to ensure deliverability. Now they're not the only company in there. There was August, which is now Cheyenne; there's BP, which was in the field at that time. But you give an advance of $2 million of taxpayers' money to a private company, and there must be a contract, eh? And you're the one who announces this. There must have been some agreement. I am asking the minister, naturally, to table the agreement, because this is $2 million — not as big as the MEL settlement, maybe, but $2 million. What was the security for that advance? Was there a contract under which the advance was made? Will the minister table the contract in the House?

That's a lot of money to give a private company which is a subsidiary of a big American oil company, American Quasar Petroleum, to test and recomplete their wells. The government of the province of British Columbia does the essential testing, or should, and did in the past. Why would you give a private company this for "recompletion" — I presume that

[ Page 773 ]

means there's some corrosion in the wells. Why shouldn't that company pay for any cleanup necessary to make the wells operable? That's a lot of money to be giving to a private company that you had been so solicitous for in the past, Mr. Minister. There has to be an agreement and we want the agreement tabled in this House. It sounds to me like a very high amount of money to give to one of the companies — the principal one, it's true — to do their own work that they should be doing for themselves. But that's in your announcement.

Now you come along in the announcement and you say a few other things. "A feasibility study on the Grizzly Valley pipeline has been completed by Westcoast Transmission and is now in the hands of the British Columbia Petroleum Corporation." I presume, but I don't know, that the feasibility study was the study that Westcoast submitted to the B.C. Energy Commission hearings. They said, in effect, that to justify an 89-mile pipeline you need 10 billion cubic feet of proven reserves for each mile of the line, which comes to 890 billion cubic feet of proven reserves. But you should table that. Let the light of day show what that feasibility study was, because on the reserves you're running all over the place. Here you say Westcoast proved them up. I dispute that.

Is that in French? Did you send that note to throw me off base? I don't know.

Anyway, you're all over the field on these reserves, Mr. Minister. When you made your announcement, something which for the Quasar Company, as I said, was $20 million before many months had passed, were you accepting Westcoast Transmission's feasibility study about the reserves? If you were, they weren't there. You have an opportunity to table that in the House. When the Premier came along he said: "Oh, no, it wasn't the Westcoast feasibility study; it was the other." It was made under the supervision of B.C. Petroleum Corporation, and that's what the Premier gave in answer to this House.

I put it to you, on that question, that the B.C. Petroleum Corporation had no engineers in the field at all and you simply accepted the private company's touted supplies of gas reserves and you made the announcement.

Then you say no decision on the pipeline will be made at this time. But you go on and you say this.... Think of the effect this is going to have on the stock market. If you're a prudent investor and you believe the minister is going to go ahead with this thing and yard the gas out, whether it's going to cost the taxpayer too much in the long run or not.... You go on to say: "However, all indications are that the pipeline is economically viable."

Now that's your signal, eh, to the investing world: invest in Quasar Petroleum. A lot of people did, and some of them made money; their shares doubled.

MR. KING: Some of them waited for weeks.

MR. MACDONALD: Yes. Now we're getting too close, eh? I want the background. You know, I have great respect for Mr. Justice Kirke Smith. I want the background we should have.

I would like to ask the minister though — he's making a note of these questions — have you received a letter to attend the inquiry before Mr. Justice Kirke Smith, Mr. Minister?

HON. MR. PHILLIPS: You know everything else. You should have the answer to that!

MR. MACDONALD: Are you going to go? Well, write it down.

HON. MR. PHILLIPS: You should have the answer to that one.

MR. MACDONALD: Okay, so I'm a slow member. But would you mind writing it down and giving me the answer? Did you get a letter and are you going to go? It's two questions, eh?

Interjection.

MR. MACDONALD: Okay. I miss some of these things. You can answer that when you get up because I'd like to hear the answer to that because I think two members of the opposition have received letters. I would have thought you could produce yours, and also answer the question. Are you going? I would think it would be pretty hard to stage Hamlet without Hamlet! (Laughter.)

AN HON. MEMBER: Good line!

AN HON. MEMBER: You're an unlikely Hamlet!

MR. MACDONALD: So here are the questions, to cut this short. The minister's got his pencil out. The first is: will you apologize? I'm serious about that.

The second is: on the $2 million — will you table the contract to which you're referring in your grand announcement?

The third is: when Mr. George Lechner gave evidence before the B.C. Energy Commission hearings in 1976 — and he would never have said that, in my estimation, in 1975, 1974 and 1973 when we were government — he said that BCPC is just an arm of the government. I want to ask the minister whether he agrees with that, because it seems to have been just an arm of the government once this coalition came into office. I think that's a mistake.

The fourth: will you say who supervised the proving of the reserves in the Grizzly Valley as stated by the Premier to this House? What engineers from

[ Page 774 ]

BCPC were there and what did they do? I suggest to you they didn't supervise at all. They received the private company figures that were at least twice as much as their own reserve figures.

Now the next question is also about your announcement on August 11. Did the minister know at that time that Quasar Petroleum corporation had a contract with Alberta and Southern Gas, a subsidiary of Pacific Gas, to deliver its gas from the Grizzly Valley fields, as and when it was deliverable, to Alberta and Southern, to go through Alberta and then down into the United States? They'd given them that contract, which was in effect for a long time and which gave them an exclusive on the gas. Did the minister, when he made the announcement on August 11, know that that gas had already been tied up to A and S of Alberta, and therefore wouldn't be available to go through a pipeline unless that contract was renegotiated or cancelled? What did you know about that? What is the present situation with regard to the Alberta and Southern contract?

Finally, since there have been fantastic increases in the price of old and new gas in the Peace River area, paid to the producers since this government came into office — and I refer to a 30-cent increase in the price of old gas....

Interjection.

MR. MACDONALD: Thirty-five, was it? No, 30 cents. Old gas increased from 35 cents per 1,000 cubic feet to 65 cents. In the case of new gas, it increased from 55 cents to 85 cents. I ask the minister whether he is going to pay to Quasar and Cheyenne and BP if they prove up any gas for this pipeline, are they to pay these companies the old gas price or the new gas price? Both have been put a way up there. But I wouldn't think the minister would make this big announcement that the thing is likely to go ahead without having that question cleared. So I want the minister to answer that.

The minister may say I don't know much about this but he was the one who made this announcement, with all its dire consequences, and so these are the questions I've got to ask the minister. The first one is about the Bannerman thing, and I just ask him, in two little words, to say that he apologizes for himself engaging in that language at that time.

MR. CHAIRMAN: Shall vote 79 pass?

Interjections.

MR. CHAIRMAN: I'm sorry. Are you on a point of order?

MR. MACDONALD: The minister is not going to answer?

MR. CHAIRMAN: Hon. members, the minister has...

MR. KING: Contempt — that's what he has.

MR. CHAIRMAN: ...the choice as to whether he wishes to answer all questions at once or answer them one at a time, and I think we can respect that.

MR. MACDONALD: Or not at all.

MR. CHAIRMAN: Yes, he has that option as well.

MR. LAUK: And you don't approve of that, do you?

MS. BROWN: What's the point of estimates then?

MR. WALLACE: Mr. Chairman, so much of the discussion on the estimates of this minister must inevitably revolve around his role in the B.C. Railway. Things in this debate get curiouser and curiouser, and I found the question period most distressing today since, as each day goes by, it becomes more clear that the inquiry which was announced yesterday creates more questions than it answers. I'm particularly distressed at the obvious double standard which this government apparently attaches to the significance of membership in a political party.

MR. KING: That's right. It's not good enough for Bierman, but it's good enough for Mr. Welsh. Drum out the cartoonist.

MR. WALLACE: We have an example where information was readily passed from the department of intergovernmental affairs to a minister of the Crown with certain notations which might or might not have done serious damage to a person because of party affiliation. Apparently it was all right to play that kind of game within the confines of one particular ministry, affecting public service employees, when in fact that notation should have ended up in the basket the minute it was read.

As a matter of fact, we haven't yet had a statement from the Minister of Finance (Hon. Mr. Wolfe) to the effect that that notation has even been destroyed. To this day it's probably still on his files. But today we now learn that the government attaches no significance to the particular party that a royal commissioner might be a member of, and the Attorney-General (Hon. Mr. Gardom) may well be right in the case of this particular individual, whom I don't know from a hole in the ground, namely that he will do his job well and without political bias. I can't answer that yes or no, but all I do know is that the people of British Columbia are not going to be impressed by the credibility of the royal commission.

[ Page 775 ]

I would suggest further that if we're to continue to get as few answers about B.C. Rail as we've had in the last day or two, then I'm afraid we're going to be here on this particular minister's estimates for a very long time.

Yesterday I asked certain questions which I still feel any responsible and knowledgeable minister would have been able to answer, or would have found the answers to had he really been conscientious in seeking them. I just want this House and the people in British Columbia to know that this government, which talks about being an open government, has to be the most farcical example of such a government. It is about as open as a 10-ton tank 10,000 feet under the sea.

I just want to tell you, Mr. Chairman, the hours that my staff spent this morning alone trying to get simple, public information out of BCR. That's 69 million bucks in the hole in this coming year of taxpayers' money, and I can't find out anything. Open government — what a farce!

MR. G. MUSSALLEM (Dewdney): Don't say that, Scotty.

MR. GIBSON: It's right, George.

MR. WALLACE: The member for Dewdney says: "Don't say that." Maybe the reason he doesn't want me to say it is that it's not only true but it's also so easily documented.

MR. KING: Right on!

MR. MUSSALLEM: It's not true.

MR. WALLACE: Okay, let's just recite chapter and verse for the member for Dewdney.

At 9:30 this morning my secretary phoned Mr. Norris' office, the vice-president of the railway, identified herself, and said she wanted certain information. She spoke to Mr. Norris' secretary who said that Mr. Norris was out of town but she would refer the question to someone else who could help us and they would phone my office back.

By 12:45 no one had phoned us back. My assistant phoned Mr. Armstrong, who is Mr. Norris's executive assistant and director of public relations, no less. His secretary said that he would be back after 1 o'clock. My staff phoned back at 1:15, and Mr. Armstrong's secretary said he would not be in until sometime this afternoon and took my number. Then she suggested that we call the purchasing department, because I'm still trying to find out about that $600,000 that was spent on equipment owned by Ragan Construction, which was 50 per cent of the settlement with the creditors in Dawson Creek and elsewhere, I might say — not just in Dawson Creek.

Then my office phoned Mr. Norris' secretary again. She said that she had not called us back because no one but Mr. Norris could give us the information. Then my research assistant, in some frustration, followed the advice and phoned the purchasing officer. The purchasing officer referred my assistant to Mr. Hart, who referred him to Mr. Richmond in the engineering department. Mr. Richmond said he had not been informed of the purchase, although Mr. Hart had said that Mr. Richmond was usually the person involved in such purchases. Mr. Richmond suggested that we call Mr. Gordon Ritchie of the real estate and industrial development section. Mr. Ritchie said he might be able to help, but he would have to check.

So after hours and hours of phoning, I'm still no further forward in trying to determine what exactly goes on when a citizen — and in this case it happens to be an elected citizen — tries to find out public information about a public Crown corporation which is losing money at the rate we've just heard in the minister's own words. And this government has the nerve to call itself an open government! The whole morning has been totally frustrating from the point of view of trying to find out what should be public information.

I notice that Mr. Norris is seated on the floor of this House at the moment, and I notice that his secretary in no way, shape or form, offered the least fragment of suggestion or advice that this is where I would be likely to reach him, despite the fact that my office had identified where the phone call was originating from and which member of the House was seeking information.

MR. KING: The minister has put a muzzle on him.

MR. WALLACE: The word seems to be out, Mr. Chairman, to everybody throughout the ranks of B.C. Railway: "Don't say anything to anybody!" That seems to be the message loud and clear.

AN HON. MEMBER: Throughout the whole government.

MR. WALLACE: All I'm trying to find out is how $600,000 worth of taxpayers' money was used to settle a dispute with a contractor on the B.C. Railway, a dispute about which two other directors said there was no obligation whatever to settle with Ragan Construction.

Mr. Chairman, I go out of my way to get as much evidence as I can on any issue before I make any public comment. I think that's the kind of responsibility that behooves all of us in this House. I've tried, and my staff have tried, to find out some very basic facts and figures which should readily be provided by the party responsible, namely the British

[ Page 776 ]

Columbia Railway. I think the kind of treatment that I have received, as an elected member of this House, and that my staff has received, is not only shabby, but verges on a serious measure of irresponsibility by the administration of B.C. Railway, not to mention the minister's own dilatory attitude in trying to find out the answers to my question yesterday. Even that overlooks the very serious conflict of interest that he has already involved himself in through this whole Ragan Construction settlement.

But apparently, Mr. Chairman, while members of this House can't find basic information relating to the spending of public funds, we get statements like this — that an unnamed cabinet minister says the provincial cabinet is wondering whether one of its options is to sell B.C. Railway to CNR. On the Telex this afternoon was a report of a statement in The Vancouver Sun:

"An unnamed cabinet minister has been told that the B.C. Railway will need $1 billion in capital in the next five years. The cabinet minister is reported to have said that 'one of the major reasons for the decision by Premier Bill Bennett to appoint a royal commission into all facets of the railway relates to this capital requirement.' The cabinet minister said: 'Another option for B.C. Rail would be its sale to Canadian National Railways.'

"The cabinet source said that the government is concerned that the vast expenditures by B.C. Rail that are anticipated in the development of northern British Columbia should be justified. Interest on the $1 billion, which would have to be borrowed over the next five years, beginning immediately, would be about $100 million a year. The cabinet minister, who is still unidentified at this moment, said: 'We just have to be sure that we know what we are getting into.'"

The report goes on to mention some of the anticipated expenditures.

Mr. Chairman, I just want to pose a few questions to this minister. First of all, apparently I cannot be given some very basic financial facts and figures referring to a settlement that has already been arrived at between BCR and the contractor, and yet a person in the media apparently can have a private conversation with a cabinet minister where the most vital and important information is made available to that reporter while we, sitting in this House, with the responsibility of scrutinizing this minister's responsibilities, are kept, as far as is humanly possible, in the dark.

Mr. Chairman, I would wonder, first of all, if I could just ask a few very clear, simple, direct questions. Can the minister tell the House if he is the unnamed cabinet minister in The Vancouver Sun report who made the statement that the cabinet has been asked to authorize $1 billion in capital expenditure over the next five years?

I notice the minister is diligently reading some lengthy document and appears to be perhaps less than listening to what I'm asking, so maybe I should ask it again. Can the minister tell us if he is the unnamed member of cabinet reported today in The Vancouver Sun as having said that cabinet will be asked for $1 billion for capital expenditure in the next five years? If he is not the unnamed cabinet minister, it seems to me that it's a highly serious situation that some other member of cabinet is apparently willing to give — through the disguise of anonymity that I've mentioned — this kind of information privately and secretly when it's not available to the House.

Secondly, I would like to ask the minister if, in fact, one of the primary subjects that the Premier of this province is now in Ottawa to discuss with the federal government is the purchase of the B.C. Railway by CNR. I'm not asking him whether they will or they won't buy it. In my view of the thing I can't imagine why anybody would want to buy the B.C. Railway. But I would like to know at what stage negotiations are with regard to the possible purchase of BCR by the CNR.

MR. G.R. LEA (Prince Rupert): They'll buy it if they get it for nothing.

MR. WALLACE: I suppose in the present situation, Mr. Member, this government might even be willing to give them money to take it off their hands.

AN HON. MEMBER: In lieu of a grant.

MR. WALLACE: There couldn't be a more inefficient management of any railway than we've witnessed in BCR recently. But I would like to know whether or not negotiations are underway for the CNR to purchase BCR, or is it simply an option which the B.C. Railway and the B.C. government are presently pondering in cabinet?

The other questions I would ask at this time relate to the issue I raised yesterday. I'd like to know if the minister has discovered, regarding the $600,000 paid for Ragan Construction equipment.... These are simple questions which should take about five minutes for any efficient business administration to find out. First, was an independent appraisal sought in determining the value of that heavy equipment? If an independent appraisal was sought, what was the figure provided? Whatever that figure was, I would like to know how it relates to the $600,000. Was that, in fact, the independent appraisal price, and did BCR agree to pay more, less or exactly the appraisal price?

I notice the minister's gone into a huddle, which I

[ Page 777 ]

can understand if he hasn't taken the trouble to find out the figures by 3:25 this afternoon. He's had all morning and last night to find out.

Mr. Chairman, the next question is: if there was not an independent appraisal of the value of that equipment, by what manner was the figure of $600,000 reached? Who made the decision that, in fact, it was worth $600,000 if it was not reached by an independent appraisal?

I think that the minister should also tell us which finance company owned the equipment at the time Ragan Construction ran into financial difficulties.

I hope the minister's making notes because these are very straightforward questions but there are quite a few of them, one contingent on the other.

What finance company had a part ownership in the equipment at the time of the settlement? What part of the $600,000 went to the finance company: all of it, half of it, 10 per cent?

I suppose the next question really is the simplest one of all. Since this was a substantial sum of public money being paid by BCR as a result of negotiations in which the minister had compromised his own neutrality, will he file in this House the agreement showing the financial details by which the Ragan Construction settlement was reached?

Mr. Chairman, I'm only asking for the most straightforward, basic disclosure of financial dealings of a Crown corporation that functions on the tax money that you and I pay every day in this province. I'm not asking anything fancy or sophisticated, and the figures could be produced very quickly if this minister and this government had any desire to do so.

I don't find it quite as amusing as perhaps others do that there are all kinds of contractors lining up at the wicket to get some of the money that they think is due to them. I think it's just a shocking and distressing indictment of the highly inefficient methods of the B.C. Railway.

MR. GIBSON: They're shovelling it out the back of the caboose.

MR. WALLACE: I would like to know how many more contractors are presently either in negotiation to try and retrieve further payments for work done or have suspended or terminated negotiations since they feel that negotiations will not finalize their problem, leaving them with no option but to sue BCR in the same way that MEL Paving did. How many other contractors are presently still seeking redress from the BCR? Of those who are, what is the total value of the claims which they are seeking to have satisfied by BCR?

There are many other questions, Mr. Chairman, that I think need to be asked, but these are very simple and they're very direct. The answers are readily available — and should be available — as a matter of public information. The minister has had since approximately this time yesterday afternoon to find out the answers. In fact he promised that he would. So I won't waste the time of this House any further. I'll just ask him if he would now be kind enough to give just the straightforward, direct answers to equally straightforward, direct question.

HON. MR. PHILLIPS: With regard to statements made by the first member for Vancouver East (Mr. Macdonald), I'm not aware of the statements in the press to which he's referring and I'll certainly take a look at them.

MR. MACDONALD: I'd have read them out to you.

HON. MR. PHILLIPS: I'm not going to discuss at this time all of the Grizzly Valley deal. I'll have some more to say on that later.

I would suggest, Mr. Chairman, that the hon. member for Vancouver East just be allowed to dig himself further into his own gluepot.

MS. BROWN: That sounds familiar.

HON. MR. PHILLIPS: Now in answer to some of the questions from the member for Oak Bay (Mr. Wallace), it's very disappointing, I know, to members of the opposition to see a government move so swiftly, so solidly...

MR. LEA: Over the cliff.

HON. MR. PHILLIPS: ...and so surely to provide openness in government. I know that the members opposite were very disappointed when there were allegations made with regard to the Grizzly Valley and the government moved swiftly and decisively. That disappointed them because they couldn't find anything to criticize. So now they're going back over the same old ground. After they called for a judicial inquiry into the railway, their requests were met with. They're also very disappointed about that. I think if I were in the opposition I'd share that disappointment.

MR. WALLACE: Just answer the questions.

HON. MR. PHILLIPS: I would suggest that the member for Oak Bay doesn't need to advise me of what I shall say in my estimates, Mr. Chairman. I have not advised him as to what he should say in some of the statements that that member has made today, with particular regard to a slap against the management of the British Columbia Railway — management who I have had the opportunity of dealing with in the past year, management who are

[ Page 778 ]

not able to protect themselves in this House. So as I say, Mr. Chairman....

MS. BROWN: Answer the questions!

HON. MR. PHILLIPS: The members over there get very excited.

AN HON. MEMBER: You're not answering the questions.

MS. BROWN: Answer the questions!

HON. MR. PHILLIPS: I will answer the questions in due course.

As I said before I was so rudely interrupted by vibrations from the opposite bench, I did not advise the hon. member for Oak Bay (Mr. Wallace) as to what he should say. He did more than ask questions. Maybe I don't think that he's in too much of a position to advise me as to how I should answer the questions or what statements I should make in answer to these questions.

MR. LEA: It doesn't matter how you do it; just do it!

MR. LAUK: Don't attack the member for Oak Bay; he's always fair.

HON. MR. PHILLIPS: I'm not attacking the member for Oak Bay; he is quite capable of looking after himself.

Now with regard to the question about an article — again that I'm not aware of, that I haven't seen — I will not answer any questions with regard to something that I'm not aware of. So that's answer No. 1.

MR. WALLACE: I'll send you a copy.

HON. MR. PHILLIPS: I can't be responsible for articles printed in the press. We have free press in this province and, God bless, I hope we'll always have free press. I know the member for Oak Bay hopes that we will have free press. I haven't seen the article and I can't be responsible, as I said, Mr. Chairman. And, God bless, because I wouldn't want to be responsible. We have a free press and democracy in British Columbia. And so be it always.

With regard to question No. 3 about what is going on in Ottawa, I think the Premier is very capable of making his own announcements with regard to the deliberations that he's having in Ottawa, and he will probably do so on his return.

Now question No. 4 or 5 asked if there was an independent appraisal. I stated yesterday that I would get that information for the member and, yes, there was an independent appraisal. The equipment was also appraised and valued by BCR construction personnel knowledgeable in the area. The equipment included a camp; this will be used by BCR in place of purchasing new equipment. It is the intention of the BCR to use the equipment, particularly on the Fort Nelson fine where it would be advantageous to use our own force as opposed to an outside contractor at this particular time.

MR. WALLACE: What was the appraisal figure?

HON. MR. PHILLIPS: There were several finance companies involved, Mr. Member for Oak Bay: Toronto-Dominion Bank, Wardley, Firming, IAC, FMCC, Traders — just about every finance company that I'm aware of was involved in it. I'm just studying the agreement. Anything that I don't have here today you realize will be available to you in public accounts.

MR. LEA: What was the independent appraisal?

HON. MR. PHILLIPS: I'm just studying the agreement. You want to know exactly what the amount was paid out to the finance companies and the banks and what was left over. As I say, I'm just into the agreement now and I'll get that further information for you.

MR. CHAIRMAN: Hon. members, before we continue, I've withheld making this statement until we were between speakers as I didn't wish to interrupt anyone speaking. Perhaps the questions that are being asked across the floor, without a member standing in his place and being recognized, are creating a great deal of havoc with the Hansard recording people. Perhaps all questions that you may have should be asked after you have stood in your place and have been recognized. It will certainly assist us greatly.

MR. WALLACE: I'll be very brief. I just want to follow up on the minister's response. I appreciate the amount of detail that he has given us today. I regret that we've had to drag it out of him, but we do have the information.

What he was careful to avoid answering was, what was the appraisal figure? Was it $600,000? I want to know the actual sum paid and how it related to the appraisal figure.

Since he has all the information and the details there, once we move out of committee and back into the House would he agree that we ask leave to table these documents? The public accounts committee is one arena; this is a more important arena than the public accounts committee. I suggest that in respect to the rules and traditions of this House, we should

[ Page 779 ]

have access to these documents.

HON.MR. PHILLIPS: With regard to the appraisal, I am trying to obtain that figure for you, Mr. Member. You did not ask it yesterday, or if you did, I missed it. I am trying to obtain that figure for you now.

With regard to tabling the document in the House, as you know, I am not a lawyer, and this is an internal document. I'll have to be honest with you — I'll have to seek counsel. I don't know whether it can be tabled or not. I think you'll have to accept that. As I say, it's an internal railway document. I suppose it would be available to public accounts, but anyway, I'll certainly seek counsel.

MR. MACDONALD: Mr. Chairman, I didn't do as well as the member for Oak Bay (Mr. Wallace) . I've got seven questions here, and I didn't get answers to any of them. I don't know what that member's got. It must be his personality or his secretary.

Here's a simple question, Mr. Minister — one of the seven questions: did you get a letter from the inquiry commission into the Grizzly Valley affair asking whether you would give evidence, or anything to that effect? If so, are you going to give evidence? There's a simple one that is not from the newspapers.

HON. MR. PHILLIPS: Well, Mr. Chairman, I presume that the judicial inquiry is able to run its own affairs. I'll abide by their requests, as I have said from the very beginning. The first day this was brought to my attention, I said that it certainly is my intention to have the entire light of day shine in on this matter. That has been my entire attitude from the very beginning, and I certainly haven't changed.

MR. MACDONALD: That's not the question. Have you had a letter?

HON. MR. PHILLIPS: If there are people working for me or influenced — I realize that I have a very touchy portfolio — I certainly want to know all the ramifications of this. I'm certainly glad it came up. I'm not glad it happened, but I am glad that it is revealed. I think, as I said before, we will move very, very swiftly on this and we move surely. My attitude has not changed since the very first day I spoke to the press. I said: "Absolutely! Let the light of day shine in on this whole matter."

MR. MACDONALD: Mr. Chairman, I asked the minister a very simple question. Did he have a letter from commission counsel asking about giving evidence? Can you nod your head? Can you indicate?

HON. MR. PHILLIPS: You know everything else. You must know that.

MR. MACDONALD: You are not answering, eh? Well, Mr. Chairman, I am going to answer the questions on behalf of the minister because it's pretty hard to get an answer out of that empty vessel over there.

HON. MR. PHILLIPS: If you know the answer, why did you ask the question?

MR. MACDONALD: Well, okay, I'll answer and then you can confirm them later in the debate — maybe next Tuesday or something of that kind. Can you waffle that long?

In answer to the first question, having considered it and having seen that the press report was simply reporting a court proceeding, I apologize on behalf of the minister and extend that to him.

The second question was: has he received a letter? I don't think he has. You know, it's rather strange that he didn't get a letter when opposition members did. That should be taken up with commission counsel.

The next question was: should you have made the announcement of August 11? No, it was highly improper for the minister to have made that announcement. He will confirm that to the House when he answers.

The next question was about the $2 million contract. The minister is going to answer correctly, I am sure, that that was really a very unprecedented handout to a private company with which the minister had had long relations, and that it has not happened in that form to any other company in the province of B.C. The minister is not going to table the contract. He is going to resist that. He says, "Let the sun shine in, " but whenever he can run down the blind, he's got a habit of doing that, as we have seen in this debate.

I asked him whether he agreed with George Lechner that the B.C. Petroleum Corporation had been made an arm of the government. On behalf of the minister, I am answering yes. It has been under this Social Credit administration. That is question four, so it will save your answering that.

The next question was: did the BCPC supervise the testing of the proven reserves in Grizzly Valley? The answer is no. It didn't supervise those.

The sixth question was about the Alberta and Southern gas contract. Was Quasar released from that when these big announcements were made? The answer is no. It wasn't released at the time of the Premier's answer either.

The next question was whether you are going to pay Quasar Petroleum the new gas prices, which are 85 cents for 1,000 cubic feet, although it's definitely old gas. You won't have any definitive statement about that, but in the end result, the answer is going to be yes. They are going to get new gas prices for

[ Page 780 ]

what is really old gas, wells that were developed before the last burst of inflation about 1970, 1971 and 1972.

I don't know whether I've missed anything. I have tried to cover all the questions I've got here. I think I have answered them all.

HON. MR. PHILLIPS: Mr. Chairman, I don't propose to get into matters surrounding the judicial inquiry because, as the ex-Attorney-General knows, that wouldn't be wise. We don't want to usurp their powers. I am sure, as I said, that the light of day will shine in.

Now the ex-Attorney-General, the man who was once in charge of energy for the province, seems to know a lot about gas prices and seems to want to build some sort of web or something. I think his words were that I was promoting for Quasar.

Mr. Chairman, maybe I should just relate to the House once again that I was elected to this Legislature, after a brief recess, in August, 1972. At that time, instead of being elected to the government, I sat where the member for Vancouver East is sitting now, in the opposition. However, at that time, Mr. Chairman, I did not shirk my responsibility, even though in opposition, in trying to represent those good people who had elected me to the Legislature.

I know that the hon. member for Vancouver Centre was very interested in that area and shared a lot of the aspirations that the member for South Peace River had in the development of the natural resources of that particular area. I've talked to him on various occasions and I know he shared a lot of the aspirations that I had, because he, among very few of the members opposite, Mr. Chairman, wished to see economic development in the province. I'll certainly give him credit for that.

MR. LAUK: Flattery will get you everywhere!

HON. MR. PHILLIPS: In the fall of 1972, in cooperation with the Chamber of Commerce and the city of Dawson Creek, in order to bring some attention to what was happening in the Monkman Pass area and the Grizzly Valley area, we invited press from the lower mainland up. It was an endeavour to bring to the government's attention exactly what was happening there. I'll have to relate to the House once again, Mr. Chairman, exactly what was happening there. There was a development going on in there. Oil wells and gas wells were being drilled, and the money that was being spent in the area was being spent in the neighbouring province of Alberta. And that bothered the member for South Peace River because he felt that any rewards or any economic development or any business going from the development of the natural resource in the area should be staying and be of benefit to the citizens of British Columbia. So this, Mr. Chairman, was the reason for having the CBC with their television cameras and business people from various newspapers up there.

Somewhere along about that time or maybe later — I can't remember; the member for Vancouver East has all the letters I wrote — I wrote to the then Minister of Finance and said: "Look, for the small sum of" — maybe at that time — "$500,000 you can extend a road in there from the South Peace River area so that those businesses doing the work in there" — and there had been about $35 million spent on exploration in there at that time — "would give the business people of my constituency some opportunity to share in those benefits which, in turn, would benefit the finances of the province of British Columbia."

Now if the member for Vancouver East somehow wants to twist that around to say that I was working for Quasar Petroleum, that's entirely up to him. I can't keep him from wallowing in the gutter. That's his business. I'm not going to advise him. He's been in this House for quite some time.

Interjection.

HON. MR. PHILLIPS: Mr. Chairman, would you ask the member to just try and calm himself? He has been in the House for quite a while and he should be able to remain calm.

There was a northeast report put out in 1975. It was published by the Department of Economic Development, under the leadership at that time of the member for Vancouver Centre. What does that report say? You see, Mr. Chairman, I'm being accused as the only one talking about the Grizzly Valley pipeline. What does it say? It says oil and gas production are forecast to decline in the northeast. I'll tell you why that was, Mr. Chairman. That particular government had policies which drove the oil companies and exploration, so that we wouldn't have any natural resources in this province, out of the province. That's why that statement is in there. They expected the decline.

I want to tell you right now — and I'll supply you with the figures in a moment, Mr. Chairman — of the increased activity taking place in that particular area. Drilling is up. Wells are up. Exploration is up. Money coming into the coffers from bonus bids is up. But this report, published in 1975, says they expect a decline without any changes in government policy. In other words, Mr. Chairman, I think the Minister of Economic Development was trying to talk to the member for Vancouver East and telling him — the same as we were in opposition at the time — the error of his ways. So that's why I think the statement was that they're expected to decline without any changes in government policy. And I know the member for

[ Page 781 ]

Vancouver Centre was pleading with the government and with the Minister of Finance.

Now he goes on to say: "The net reserves will seriously be depleted in seven to ten years." That is presuming that the socialists remain in power. I know that's why that statement was made in this particular report.

MR. LAUK: Give me the name of the civil servant who wrote that report.

HON. MR. PHILLIPS: "Exploration activity and employment will begin to decline in approximately 1980 with Fort St. John and Fort Nelson carrying the brunt of these declines." Now I just have to inform the House, Mr. Chairman, that under the great economic policies of this government all phases of exploration for gas and oil in the northeastern section of our province are on the incline with the great reward to the people of British Columbia that there will be no artificial shortages. Thus they will be able to take advantage well into the century of their own natural resources.

It goes on, Mr. Chairman, to say that assuming no major new discoveries, the oil refineries at Taylor and Fort Nelson, unless more gas is imported from the north or from the east, are going to bring gas in from the Northwest Territories and from the Yukon and maybe from Alberta. They're going to import gas because their own policies have driven exploration out of the province.

MR. LAUK: With all this exploration, where is the new gas?

HON. MR. PHILLIPS: Exploration could decline and these pipelines, it says, "unless more gas is imported from the north, could decline after the year 2000. It is assumed in Profile 1 that a new gas plant will be built at Chetwynd." Mr. Chairman, I want to draw to your attention that it says here in this report in 1975: "It is assumed in Profile 1 that a new gas plant will be built at Chetwynd as the cheapest alternative for processing the gas from the Grizzly fields."

MR. MACDONALD: That's right, as it becomes proven as a site.

HON. MR. PHILLIPS: Yes. Now this report is 1975, and yet the member from Vancouver Centre (Mr. Lauk) would try and make this House believe that I was the first one to mention a pipeline from the Grizzly Valley. I know, Mr. Chairman, that my hard work and my indulgence had some bearing on the government of the day, and I'm pleased to see that they recognize there were some natural resources in that area.

[Mr. Veitch in the chair.]

It says: "Profile 3 assumes much more positive government action in the development of a new townsite south of Chetwynd." Mr. Chairman, I have to ask the House who was going to build that new townsite. It says that the new gas plant could be put in the new townsite, and the member for Vancouver Centre knows that it goes on to talk about higher wellhead prices for gas. I'm not going to spend the time of the House, Mr. Chairman, reading the whole report, but it talks about a Grizzly Valley pipeline, it talks about a processing plant, it talks about roads, it talks about railroads, and it talks about coal development. But that's all it was at that particular stage of the game — talk, Mr. Chairman.

MR. LAUK: Still is.

HON. MR. PHILLIPS: Now when I was appointed to the position of Economic Development minister, I said to myself and to a lot of other people: "What's happening on that pipeline? Is it going to be built or what?" Nobody seemed to know. As the member knows, there were different counts on the reserves in that area because it's a very difficult field. The terrain is rough and there are faults. We find this in coal too, you know. It's a very difficult field.

So I said: "Well, what's up? Why isn't the pipeline built? When are we going to get on with it?" The member for Vancouver East knows this. So I called in the economic planning committee members from the Department of Mines and Petroleum Resources and I called in people from the British Columbia Petroleum Corporation, and I said: "When are you going to build that pipeline down there that this report talks about and I fought for? I think I even mentioned it in my election campaign. When is it going to be built?" Well, they went on to say there are varying aspects, as the member pointed out, various numbers....

MR. MACDONALD: Company figures.

HON. MR. PHILLIPS: Various numbers, sure. Well, I want to tell you, the company had one figure, the B.C. Petroleum Corporation had another figure, the Department of Mines had another figure, and the same department of geology and oil in Calgary had another figure.

MR. LAUK: Table it!

MR. LEA: Which one did you use?

MR. MACDONALD: You used Quasar's.

HON. MR. PHILLIPS: I'm not a geologist, but anyway, to get this great province moving, we said:

[ Page 782 ]

"Let's get on with the job. Let's all come together. Let's find out what is in there." I'm not telling you what's in there, but if the reserves are in there, let's build the pipeline.

MR. LAUK: No reserves, and you know it!

HON. MR. PHILLIPS: Well, I want to tell you, Mr. Chairman, the member says there are no reserves. If he supplied a little bit of the gas that he has been espousing here in the House, there would be enough to build three or four pipelines, but that's another matter.

MR. LAUK: There's none up there.

HON. MR. PHILLIPS: Now, Mr. Chairman, I said: "If there are not sufficient reserves in there I would like you to tell me how much more reserve we need before the pipeline can be built." So there was a meeting of the minds and it was found that there were sufficient reserves in there and, of course, the pipeline will be built.

I have to wonder and question, Mr. Chairman, what possible motive the member could have in trying to criticize a corporation that was set up under his ministry and the very capable employees who were hired while he was in charge of that particular Crown corporation. I wonder just what could possibly be that member's motive. He's turned against the very people in whom he once had a lot of faith.

Now we have inherited, as the House well knows and as the province well knows, a very good civil service. Sometimes they've agreed with some of the ministers and the people; sometimes they haven't. When they haven't, there has been a parting of the ways, which is normal in any well-run operation. But for that member for Vancouver East to slander — I'd almost say "slander" — and lose faith in those people whom he hired and the corporation he set up....

MR. MACDONALD: Shall I answer now?

HON. MR. PHILLIPS: He talks about the guarantee and the people, but that's the way he set it up. That's the way that member for Vancouver East set the Petroleum Corporation up.

MR. MACDONALD: Wrong!

HON. MR. PHILLIPS: So Westcoast Transmission has been making profits that were unheard of prior to the corporation being set up, and that member knows it.

MR. LAUK: The member said you're wrong.

HON. MR. PHILLIPS: Mr. Chairman, I'm not going to spend any more time of the House because the public at large understands. They know what is going on, and I don't think they're too intrigued by the spider web that this member for Vancouver East is trying to weave around the Grizzly affair.

MR. GIBSON: You know, as I was listening to some of the minister's remarks, I was trying to remember the name of the character in the "Alice" books. It was possibly the Red Queen who said: "Words mean what I choose them to mean."

HON. MR. PHILLIPS: Mr. Chairman, I don't know whether you'd call this a point of order, but I'd like to ask leave of the House for just a few moments to make a very important phone call. Could I have my deputy please take some notes? Would that be agreeable with the members?

MR. CHAIRMAN: Is leave granted?

MR. GIBSON: Mr. Chairman, it seems to me that the minister should be here, so why don't we take a quick recess?

MR. CHAIRMAN: Unfortunately the committee has no power to recess.

MR. GIBSON: Well, in that case I'd move that the committee rise and report progress. The minister could make his phone call then.

Motion negatived on the following division:

YEAS — 15

NAYS — 26

MR. GIBSON: Mr. Chairman, I certainly welcome the Hon. Member for Prince Rupert (Mr. Lea) as the newest member of this coalition government. (Laughter.)

[ Page 783 ]

I'm glad the minister has had a chance to complete his sudden phone call. I hope it was satisfactorily completed and no bad news.

The point that we were discussing a few moments ago that I wanted to raise was the question of the genuine openness of information in this government. I couldn't believe my ears when I heard that minister talking about letting the sun shine in. He's the original little black cloud over information in this province. The hon. member for Oak Bay (Mr. Wallace) discussed earlier on some of the difficulties he was having getting information out of the British Columbia Railway. The clam-up's not just in the BCR, Mr. Chairman; it's all through that minister's department. It's the nearest thing to paranoia I've ever seen when you try and get any proper information out of public servants.

Now I want to ask the minister a specific question about a specific report that he's refusing to release. It's called the Pemberton report. It was submitted to the government around about September of 1976. I asked the Premier in the House a couple of days ago if he had read it. The Premier said he was not sure whether he'd read it or not. Mr. Chairman, that was a little bit like the Speaker not being sure he'd read the standing orders.

That's a report that's of such incendiary consequence to this government that they're sitting upon it because they're afraid of it. I ask this minister about it specifically. Has he read it? Why was it kept secret? Why were all the numbered copies recalled round about late November of 1976? What's in it?

I suggest to the minister that, among other things in that report, there is a prediction about the future of the coast forest industry. There is a prediction that in the next few years, as costs go up on their continuing trend, and without modernization, the jobs in the coast forest industry will drop to 50 per cent of their current levels. I suggest that that specific prediction is in that report and the government has been sitting on it for the last three or four months.

That report should be released. There are 30,000 jobs in the coast forest industry, Mr. Minister. If 50 per cent of them are going to disappear on present trends, what are you going to do about those present trends? Why aren't you going to release the report that made that prediction in the first place — the report that says how expensive it is to build new capital facilities in the forest industry these days, how those costs have considerably more than tripled in the past few years, how the ability of the declining stumpage payments to the province to cushion some of these cost impacts has just about ended now, which is one of the reasons the Minister of Finance (Hon, Mr. Wolfe) is having a little trouble raising some of the revenue out of the natural resource side? Why doesn't he table that report? Because he's afraid of what's in it, that's why.

Why doesn't the minister, in fact, Mr. Chairman, table a list of all the reports that his department has received in the last year and give us chapter and verse as to why the public that has paid for them cannot have access to them? It's straight concealment of information that the public has paid for and has every right to know. The forest industry is our most important industry and we can't get that most important report.

As far as 1977 is concerned, the biggest economic decision this year is going to be the question of northeast coal. Mr. Chairman, in February of 1976, the group known as the Coal Task Force submitted a document called "Coal in British Columbia: A Technical Appraisal." That was made public. At the same time, they presented an economic and policy overview. That was never made public. It has not yet been made public. Other studies were commissioned at the instigation of the Department of Economic Development.

Agreements were recently signed with Ottawa providing for $3 million worth of studies. Some of them have already been completed. Not one of those is available to the general public in this most important economic decision to be taken this year in British Columbia, talking about the expenditure of half a billion dollars of public funds for various kinds of infrastructure, from housing through roadbed through rolling stock, energy supply, and we can't get hold of it.

We have a report that deals with questions of the displacement of coal production from southeastern British Columbia to northeastern British Columbia, and reports that talk about matters that are worth the livelihood of our future generations. It's that simple. The cabinet is working on the decisions; the cabinet is negotiating with Ottawa. Can the people who are being affected by these decisions get a look at the numbers? No, sir, they cannot. They have to try and get the information anywhere they can, and that's where you really run into the paranoia, Mr. Chairman.

I have never seen people in the private and public sectors so worried about anything as they are about providing information on this coal thing. They are afraid of the minister and they are afraid of his department and they are afraid for their futures if they breathe a word of information that British Columbians ought to have the right to know. And I say that's rotten.

Look at another little area of sunshine in that department. I brought it up yesterday; it was with respect to the B.C. Development Corporation. I am glad to see the head man is back here. Maybe he's had a chance to think about it overnight. It has to do with the making public of the names of the companies and persons to whom loans are given.

Mr. Chairman, why shouldn't these loans be made

[ Page 784 ]

public? There's nothing wrong with getting a loan; our largest and most powerful companies do it. It doesn't indicate any weakness. All it indicates is that you've got good credit and you've got a bit more money in the bank. There's nothing wrong with making public the fact that you've got a loan. Why should it be such a sensitive issue, which I think was the word the minister used yesterday? It's not sensitive unless you're trying to conceal something that's wrong. That's the only account I can give.

Mr. Minister, I wouldn't think this of you, but one of these days somebody is going to say: "They're not telling you the names of the companies that are getting loans because they might be friends of the government." The only way you're going to protect yourself against that kind of charge is to do the right and proper thing and make those names public.

When you talk about open government, let's talk about the way decisions are made on the British Columbia Railway. The hon. member for Oak Bay (Mr. Wallace) yesterday brought up what to me is a clear case of conflict of interest, and that is the Ragan Construction case — a case whereby the minister, who is in charge of the British Columbia Railway and reports to the House for the British Columbia Railway, had a problem in his own constituency. It was a serious problem. The firm concerned owed a tremendous number of debts in the minister's constituency, and he was properly worried about that. He attended a creditors' meeting and then he attended a board meeting. The initial press report indicated that the board of directors didn't think there were any particular obligations to the construction company. Then all of a sudden we see a settlement with the company in excess of $1 million.

Now, Mr. Chairman, here are the questions I want to know about that settlement, and they are the kind of public information that, I say again, must be done to clear the air. Question 1: did the Ragan settlement go to the board? I would hope and trust it did, in excess of $1 million, but did it go to the board? No. 2: was the minister present? No. 3: did he move or second or recommend or vote on the question of that settlement to Ragan Construction that so affected so many of his constituents? No. 4: did he disqualify himself as, for example, even our Municipal Act suggests that councillors ought to do in questions touching their own interests? Finally, if he's the sunshine minister he says he is, will he file the appropriate corporate minutes which disclose exactly how this settlement was made?

You can't talk about sunshine, Mr. Chairman, without being willing to disclose the embarrassing things as well as the things that make you look good. The one has to come with the other. You're either open or you're closed. You can't choose what you let out. You have to let out the things that are properly public.

I suggest to you, sir, that every study that has been done by every consultant for your department should be a public document, subject only to individual corporate confidential information being disguised in some way or another, as Statistics Canada, for example, finds it easy enough to do. We paid for these; the people of British Columbia paid for these studies. This House has voted the money for these studies and we can't get a look at them. And they have to do with the most important decisions being made in this province this year. So much for open information in that department.

Next, let's look again at the British Columbia Railway. Talk about open government! Look at the Dease Lake rat hole that the money's going down. How many million dollars a month, Mr. Minister, are going down that rat hole? We can't get the money that's been spent to date out of you. We can't get your estimated cost to completion; we can't get your estimated revenue. How can we tell whether it is worth spending one more dollar on that line the way things stand right now without those figures? And yet we know from the budget of the Minister of Finance (Hon. Mr. Wolfe) that we're going to be asked to authorize a good deal more borrowing authority for that railway before this year is out.

Come clean on these things or resign your portfolio. You have to account for the people on the agencies for which you're responsible. That includes the BCR. The borrowings for the BCR over the past two years have put a debt of $150 on the shoulder of every man, woman and child in this province. You throw the millions of dollars around so easily. Enough money has been borrowed there to lead the way in constructing a couple of new pulp mills in this province, where you'd have some guaranteed jobs. So I say to that minister, through you, Mr. Chairman, if he's going to talk about open government he'd better justify the money being spilled — maybe that's the right word — on that Dease Lake line right now.

Then I want to go on and express a little bit of puzzlement about the Terrace connection. It seems to me that the minister made a major policy announcement yesterday because a couple of times in the afternoon — I was talking about the Bear River Pass development — he said this in answering: "That submission only becomes functional if a line north of Terrace or Hazelton is built and that line is not contemplated at the present time." In the evening, to underline that, he said further: "I don't anticipate that any route will be built immediately. It's left open and you could have a route north from either Hazelton or Terrace and/or Stewart. I'm sorry I can't give you any more definite information than that."

That's a funny thing, Mr. Chairman, because all along this grand scheme for the Dease Lake has suggested that the ore and forest products and other

[ Page 785 ]

produce of the hinterland being tapped by the Dease Lake extension would basically be brought out through tidewater. The port of Prince Rupert was always the idea. Now how do you get from those northern resource areas to the port of Prince Rupert? Well, what you do is either go all the way back to Prince George and come back out to Prince Rupert — for an additional haulage of 600 miles, 300 miles each way — or else you build that cutoff. If the minister is now telling us that that cutoff has been dropped from the plans, then I think he's made a major policy announcement. It would be a good thing if he was to explain, particularly since the money was going to come from the Canadian National. I think he'd better explain that.

There's another thing about the B.C. Railway I'd like him to explain, Mr. Chairman. What happened in terms of a search for the president last summer? It is my information that a president was chosen from an eastern firm — and I will not name his name — and that a job offer was made to him by either the minister or the Premier or both. That man had told his firm and his partners about it, told them he would be leaving. That could not have been an easy decision for him to make nor an easy communication for him to make to his partners. At the very last minute, just before the move, that man got a telephone call from the minister saying: "Sorry, the deal's off. You haven't got the job." What I want to know, Mr. Chairman, is why. That's pretty rough treatment. I want to know why that was done.

Mr. Chairman, there are so many other questions on the BCR that we should be getting into here. What is being done about general running rights in the Vancouver port area? The minister knows what a foul-up that is. He knows the situation that Vancouver Wharves Ltd. has, for example, being just a few hundred yards in from the CN. Yet any time there are any labour problems on the BCR, zap! — they're locked right out. All of the produce that would normally go out through Vancouver Wharves is hauled in on the CN trackage and except for a few hundred yards it has no kind of access. Why can't there be some kind of a reciprocal running rights agreement to get around that problem? Let the BCR keep the revenue that they get from that section of trackage, but give them running rights over it so that some continuity of supply can be maintained in those times.

We're good Canadians in this province. How much of the BCR-originated lumber traffic is now going to the eastern United States via U.S. mainline carriers? The vice-president of the BCR and the public accounts committee gave us a figure last year. If I recall, it was around 50 per cent to the eastern U.S. that was going via U.S. carriers. Is there not some way, Mr. Chairman, that we can keep those extra jobs in Canada; that we can make a deal with the Canadian railroads to haul that over Canadian trackage and give Canadians jobs and yet yield the same amount of revenue to the BCR? I know it's a revenue question. I know the BCR wants the extra revenue for hauling it down through North Vancouver, then interchanging there and down to the U.S. roads, rather than backhauling it a relatively short way to Prince George and interchanging with the CN there, or rather than building the Clinton-Ashcroft cut-off and interchange there. But, Mr. Chairman, there has to be some way of working out the revenue arrangements so that BCR does not suffer and yet the rest of the country prospers. That's a haywire situation.

I would like to know, as well, the minister's current view, or the railroad's current view, on the question of the Ashcroft-Clinton cut-off, which is one of those great ideas which seems to have sunk into limbo in recent years. Mr. Chairman, the minister was talking about open government. Here is his chance to open it up right now.

HON. MR. PHILLIPS: I listened with interest to the member for North Vancouver–Capilano when he talked about secrecy in government. I just want to inform him again that this is indeed an open government, regardless of what he may say.

MR. GIBSON: File the Pemberton report,

HON. MR. PHILLIPS: Maybe the member forgets, Mr. Chairman, that it was this government that brought in legislation to establish an auditor-general.

MR. GIBSON: File the Pemberton report.

HON. MR. PHILLIPS: Maybe it was this member who forgot that we are establishing the position of ombudsman so everybody can have access.

MR. GIBSON: Yes, but file the Pemberton report.

HON. MR. PHILLIPS: Maybe this member forgets, Mr. Chairman, that this government instigated quarterly fiscal reports so that all of the taxpayers of British Columbia would know what was happening in the affairs of not only the government, but all of the Crown corporations.

MR. GIBSON: All except in time for the budget — every other quarter.

HON. MR. PHILLIPS: Maybe this member forgets that it was this government who has before this House — and I guess I can't talk about it — disclosure legislation. I want to tell you, Mr. Chairman, that maybe that member forgot that we just appointed a royal commission to check into all aspects of the operation of the British Columbia Railway. I believe I

[ Page 786 ]

recall, when the Premier made this announcement, that this royal commission report, similar to the Sloan report on forestry, would serve as a guide for not only this government, but future governments. You know, I'm very pleased with this, because I think that's really what's needed. All of the questions that the member has been asking about the BCR are questions that a lot of people are asking. I'm asking some of them myself.

With regard to the Pemberton report, I want the member to know that we do a lot of in-house study reports here. Sometimes we don't have the staff to do all of the reports that we would like to have with regard to certain aspects of the economy of British Columbia. I want the member to know, and he knows — he worked in Ottawa — that there are sometimes in these reports that confidential information is given with regard to financial statements of companies.

MR. GIBSON: You can disguise it.

HON. MR. PHILLIPS: This information is given in confidence.

MR. GIBSON: You can disguise it.

HON. MR. PHILLIPS: Oh, you want me to change the report! Then, as soon as I change the report, he'd come down on me with 10 tons of bricks and say I'd changed the report.

MR. GIBSON: Not if it's for that reason.

HON. MR. PHILLIPS: Now, Mr. Member, you can't have it both ways. But that particular study, the Pemberton study, would have been done by staff for certain information we want to know with regard to the lumber industry. Now you'd think that if we were trying to hide something, we'd have hidden the Pearse report. The Pearse report is a report which was done on the lumber industry. It has been tabled in this House and is accessible to everybody.

But when we go around and go into places of business to seek information which we have to have to make certain decisions, it's confidential information, as the member well knows. He worked in Ottawa long enough to know. I don't know what his purpose is in weaving some air of secrecy when he knows the facts. Information in the Pemberton report, as I say, was received from the financial statements of individual lumber companies, and it is not going to be made public because it was given in confidence. It would have been, as I said, an in-house report. We would have done it with our own staff, had we had the staff, but, as you know, rather than build up a bureaucracy in this department we keep it as thin as we can. When we have to have certain information, we commission certain reports, and they're confidential reports. You know, you have received the Pearse report, and we are making reports public all the time, and this is indeed an open government. I don't think that the member understands that.

With regard to the cost of the Dease Lake extension, the Dease Lake cost prior to January 2, 1977, was $168,574,000. That is open government. You asked for the information and I got it for you.

MR. GIBSON: You didn't give it to me yesterday.

HON. MR. PHILLIPS: Well, I don't have it at my fingertips, you know. I'm not a computer. Sometimes I wish I were.

MR. D.D. STUPICH (Nanaimo): You'd be a bit more human.

HON. MR. PHILLIPS: Well, thank you very much. I appreciate the compliment from the member for Nanaimo.

Now the costs from January 2 to completion are estimated to be $95,436,000 for a total of $264,010,000. I want to explain to the member that these costs, of course, include interest on moneys borrowed.

MR. GIBSON: How about revenues?

HON. MR. PHILLIPS: I haven't got the revenue figure because, as you know, the revenue was only south of Leo Creek, and Leo Creek is not included in what we term the Dease Lake extension. The Dease Lake extension runs from Leo Creek, which is Mile 0, to Dease Lake, Mile 335. That is what is referred to in railway terms as the Dease Lake extension.

MR. GIBSON: But you're expecting some revenue on that portion, aren't you?

HON. MR. PHILLIPS: I'll tell you, we expected a lot of revenue when that extension was started. But you remember that we had three years of socialism in this province.

AN HON. MEMBER: Oh, oh!

HON. MR. PHILLIPS: Nobody invested in the lumber industry because they were afraid of being taken over. You realize that they brought in that mining legislation, which ceased all activity. There would probably be mines ready to be opened now had that three years.... We must remember we set the province back three years. It probably should have a multiplier effect, Mr. Member, because recall that during those three years copper markets were high and mineral markets were high. During those

[ Page 787 ]

three years there would have been commitments made, and you know how long it takes from the time of commitment to the time the mine is open. There would have been commitments made during those three years that once the flow starts to take place, the project has to be brought on, whether the metal costs go up or down. So it's not only three years that we've been set back. You use the multiplier effect due to the fact that the metal prices are down at the present time. It could be six or seven years that we have probably been set back for receiving revenue on that line.

But getting back to the Dease Lake extension, it runs from Leo Creek, Mile 0, to Dease Lake, Mile 335. I've given you the costs. There has been a lot of talk in this House about increased costs on that line. So I had my research department do a little research on the cost of inflation from 1971 to 1977. I asked research to come up with the increased cost of labour, the increased cost of machinery, the increased cost of camps, and the increased cost of transportation — in other words, anything related.

I want to tell you, Mr. Chairman, through you to the member, that the inflation rate on road construction and so forth in those few years — and we verified this right across the country, not only in British Columbia — absolutely astronomical.

MR. LEA: What is it?

HON. MR. PHILLIPS: It's absolutely astronomical!

Mr. Chairman, there was a time prior to the coalition in British Columbia in about 1954-56, if my memory serves me properly, where there were contracts let for construction of roads in the province of British Columbia.

I'd better go back. Sorry, it was in the late '40s. There was a period of very high inflation, and the contractors were losing money on the contracts that had been let. They were losing their shirts, as a matter of fact, because of inflation. This was on a road contract that was let, say, in 1946 and was not going to be finished until 1947. You'll recall that this was just immediately after the war.

There was a motion brought into the Legislature here in British Columbia, and I'll try to get some research on that. As a matter of fact, I have it here but I can't put my finger on it right at the moment. There was a motion brought in that those road contracts be increased to keep up with the rate of inflation so that those contractors who were working on those road contracts in the province of British Columbia would not go broke.

Everybody says that all of a sudden everybody's running to BCR for settlements because of a particular settlement that was made. When you talk about inflation in the years since those contracts were originally let — from 1971-72 until today — you must realize that when you talk about inflation in the 60 per cent bracket, you realize what problems some of those contractors have had. Yet it's all very good and easy for politicians to stand in this House and talk about increased costs and blame it on poor engineering.

I know myself that maybe the railway wasn't thoroughly engineered. In other words, every square cubic yard wasn't walked. But there are some other factors. It's not only that that has caused the overrun, but that's a portion of it — I'm not denying that. But in order to be fair and reasonable and not to mislead the public of British Columbia, additional costs have been incurred through inflation over which the contractors had absolutely no control. I don't think the government of the day could foresee the rapid rate of inflation we had, particularly in the years 1973 and 1974. The member for North Vancouver–Capilano (Mr. Gibson) knows full well what I'm talking about.

We also know that when those contracts were let they were let on the same basis on which we built the railway to Fort Nelson from Fort St. John.

MR. LEA: No basis at all.

HON. MR. PHILLIPS: Build her and get a train over it that can move lumber and resources. If it goes over 10 miles an hour, it will all be safe. I don't wish to belabour this point or get into it but, you know, you build a basic road.

The House knows — it's been discussed here before and everybody knows or should know that, and I'm not saying that it was good or bad, but it's a fact of life — that some of the specifications on the Dease line were changed. You know, we've got to have a little wider road base and you're going to have a better road, and that means a change of specifications. I think that the public and the people should also, when they're considering the Dease Lake extension, fully understand that at that time.... The letter was read in the House last night about environmental aspects. When you start to dig burrow pits that you were not digging before and moving the topsoil off and burying it, that is also an additional cost. I'm just pointing that out to the member who brought up the cost of the Dease line.

I also wish to tell the House that one of the reasons that we're having this royal commission is to check into all of these aspects so that the light of day will shine in. I'm looking forward to this report because, as I say, it will be a guide not only to the management of the railway and not only to the board of directors but to this government or any government that may follow.

There has been a tremendous amount of talk about railways so I did a little more research and I

[ Page 788 ]

found that practically every railroad that has ever been built anywhere in the world had been surrounded by political controversy. I also did a little research about how much we, as Canadians, subsidize the Canadian National and the Canadian Pacific and how much we have over a period of years. So I just throw that out for the members' edification, because sometimes we have a tendency, when we got embroiled in hot political debates in this House and wish to make a little bit of politics out of our British Columbia Railway, to forget some of these basic facts.

But I do want to state once again that the management of the railway is good management. We have a new board of directors. They're conscientious men and they're working hard. I want to say again that I'm very pleased that the morale is high on the railroad. The railway is running well and those workers are once again starting to feel a part of the railway. I hope this will continue because there is dialogue between management and labour. I'm not condemning what has happened in the past because I always have my eyes to the future, and with regard to the railway I look forward to the future with a great deal of confidence.

Now the member has talked about what I think he termed my conflict of interest with regard to the Ragan settlement. Maybe the member for North Vancouver–Capilano was out of the House yesterday, but, as I said, there were a group of creditors and it so happened they were in my riding. But as I said, I don't care whose riding it is. I am the politician responsible for the railroad. I don't care whose riding it is — it could have been in your riding. They were angry and they knew that Ragan Construction had a claim against the railway. They called me, as their MLA, to go and talk to them. As I said yesterday, had I refused to talk to that angry group of small businessmen — and don't also forget that I happen to be Minister of Economic Development, responsible for the welfare of small businessmen in the province....

Had the member been in my place, would he have refused to talk to those angry businessmen? I want to tell you, if I hadn't talked to them, they'd have each had to pay $300, and you seem to forget that to travel from the north down to Victoria, you're looking at $300 plus, you know. It's not a case of the member for Vancouver taking a $20 ride on the Air West and getting over here, you know. These people have to spend at least three days travelling to get down here and that doesn't leave them very much time while they're here, plus $300 cost. But that's a penalty for living in the north. I didn't ask them to live there and they live there and they know it and they anticipate this, but it is a point. So they'd have had to spend a lot of money to travel to Victoria to put a demonstration on the lawn out here.

So I felt, in all sincerity, that I was doing my best. You know, I didn't consider it a conflict of interest. But I did tell them at that meeting that I could not and would not influence the board of directors on their behalf. Consequently, that settlement was made between the lawyers. The railway lawyer was Mr. Eastman and the lawyer representing creditors was Mr. Lewis.

AN HON. MEMBER: Did not the board endorse that settlement?

HON. MR. PHILLIPS: Well, certainly the board eventually had to endorse it. I'll check through the minutes. I think I was probably there when the settlement was endorsed by the board. Certainly. You did not expect me not to be there.

AN HON. MEMBER: How did you vote? Did you vote on it? Did you influence it?

HON. MR. PHILLIPS: Well, I can't remember how I voted on it.

SOME HON. MEMBERS: Oh, oh!

HON. MR. PHILLIPS: You know, you're talking about a conflict of interest. You can entwine some aspiration along that. As I said, the only reason you're saying that is because it happened to be my riding.

MR. LEA: That's the point!

HON. MR. PHILLIPS: I would have acted the same on behalf of creditors in the member for Fort George's riding, or Skeena riding. It's all very well and good to say that we have an independent board of directors, but I full well know — as you full well know — that the buck stops here, right here on this desk. You know it and I know it.

Now what else were we asking about? Running rights in the lower mainland. I'd like to tell the member that there was a submission made to the Hall royal commission by the railway with regard to that conglomeration of conflicts we have between all the railroads in the lower mainland. I just call it a mess. You know it and I know it. That submission is public knowledge. I'm looking forward to Justice Emmett Hall's recommendations when they come out to see how he's going to handle it. I've a lot of faith in the man. His reports to various governments have been well thought out and, in many cases, the recommendations made by him have been implemented. I'm looking forward with a great deal of anticipation to his report.

[Mr. Schroeder in the chair.]

[ Page 789 ]

Again, I'll go back to another matter that the member raised, and that is making public names of companies which have loans. I don't want to keep reminding you of your past but you were in Ottawa, and you know that the Federal Business Development Bank doesn't make public the names of companies.

AN HON. MEMBER: That doesn't make it right.

HON. MR. PHILLIPS: It seems a little odd to me that the Development Corporation has been operating for three or four years and you never asked the other government to make names public. There are certain matters that can be discussed at public accounts. That information is available, and I'm sure that if the member finds something in there that he feels is not right and proper, he'll advise the public at large about it.

MR. GIBSON: Will those names be made available in public accounts, then?

HON. MR. PHILLIPS: Absolutely. You know full well that you can ask any question you want.

MR. GIBSON: The names of all those loans?

HON. MR. PHILLIPS: One of the reasons for having an independent board on the Development Corporation is that they must be responsible to not only the opposition but they must be responsible to the government of the day as well.

MR. GIBSON: But will the names of the loans be made public at public accounts?

HON. MR. PHILLIPS: They'll be supplied to you. We're not going to make the names public.

Interjection.

HON. MR. PHILLIPS: I think the member understands that. I know that it's a touchy issue, and I know that he doesn't want to make it.... He understands, and I appreciate his sentiments.

Another subject the member brought up was the north-south movement of coal. That report is public, Mr. Member; it's in the library.

MR. GIBSON: Oh, oh!

HON. MR. PHILLIPS: Yes, the movement of Sukunka coal.

MR. GIBSON: This part is public. What's not public is the companion volume.

HON. MR. PHILLIPS: Now just a minute. One thing at a time, Mr. Member. You talked about north-south movement of coal, and that report is in the library.

MR. GIBSON: No, I'm talking about the displacement — if you develop the northeast what you'll displace in southeast....

MR. CHAIRMAN: Hon. members, may I remind you one more time we cannot condone debate between two individuals, one standing and one seated, in this House? Therefore I would ask the hon. member for North Vancouver–Capilano, if he has a question that he wishes to ask, to please wait his opportunity. I would be very happy to recognize him and he can ask his questions so that Hansard can keep a record of them.

HON. MR. PHILLIPS: With regard to coal policy, we're working on coal policy; it'll be made available. There again, Mr. Member, please pay attention to your terminology, because we're not displacing southeast coal with northeast coal. As I pointed out, we want to increase our share of that market. We will be aggressive in all our efforts to increase our share of the market. We're not working one area against the other. There's a market out there and we're going to go after it, not only for the good of British Columbia but, indeed, for the good of all Canada. You know that we must have that to balance our trade deficit.

Now I think that I've answered most of the member's questions, but there's one point that I would like to bring up with regard to the cost of the Dease Lake extension. That cost, excluding bridges, is going to come out at approximately $758,000 per mile. I can't remember whether that includes the bridges or not. When we're talking about building railway extension in the northeast, I think the costs that we've come up with are in the vicinity of about $1 million per mile. So you see, in spite of all the intrigue and the cost overruns, maybe someday history will prove that everything that has been done was done right at the time. But you and I don't know that today.

I think I've answered most of the members' questions. If I've forgotten anything, I'd be most happy if they would jog my memory.

MR. LEA: Earlier today the first member for Vancouver East (Mr. Macdonald) asked the minister a number of questions which he did not answer. At that time the member for Vancouver East mentioned that when the minister, the member for South Peace River, was in opposition he had inquired of the then-Minister of Finance (Mr. Barrett) whether or not a road could be built within his riding, linking up the city of Dawson Creek to the Grizzly Valley. The minister, to his credit, quite readily admitted that,

[ Page 790 ]

yes, even when he was a member of the opposition, he'd been interested in having that road put in. He gave as his reason the fact that the people who were working in there were going to Alberta to spend their money and that the companies in there, Mr. Chairman, were going to Alberta to buy their supplies. He saw it as desirable for those people to go to Dawson Creek to buy their supplies and spend their money. I can see why that member or any other member of this House would find that desirable — so that as much as possible we keep our wages and our business within the province.

When I was a minister, Mr. Chairman, the member, the now-Minister of Economic Development, asked to come and see me about the same subject matter — a road in the northeastern part of this province. When he came into my office, it was obvious that he was very excited. He informed me that he had just come back from Calgary from meeting with Quasar and that he wanted the road built. That was when he came to see me. It may have been coincidental that he'd just flown back from Calgary visiting Quasar, directly to my office, to try and have that road built. I believe that even if he had wanted that road built on behalf of Quasar, there were other reasons why he would want the road built pertaining to his riding and to the good of the province. But, Mr. Chairman, I have had a phone call which prompts me to ask my next question.

My next question is: did the minister at any time in the 1975 election campaign receive campaign donations from Quasar, Cheyenne or August into his own personal campaign in the riding of South Peace River? I think this could be answered, Mr. Chairman, by the minister filing with this House all campaign donations that he received in the 1975 election. I would ask the minister whether he would file in this House the record of all campaign donations to his campaign in 1975, including, if there were any, campaign contributions to his own political campaign from Quasar, Cheyenne or August. I would ask the minister to answer that question.

HON. MR. PHILLIPS: Mr. Chairman, it's always a pleasure to hear from the member for Prince Rupert.

HON. K.R. MAIR (Minister of Consumer and Corporate Affairs): But he never makes any sense!

HON. MR. PHILLIPS: Well, sometimes he does and sometimes he doesn't. But sometimes, Mr. Chairman, in order to sort of put forward his own political intrigue he leaves out a lot of the information. The trip that the member was talking about was made on behalf of myself as a representative of the area interested in the natural resources of the area. But he forgot to tell you the other companies that I called on in Calgary....

Interjection.

HON. MR. PHILLIPS: Oh, no, because you have a very short memory when it serves your own political mudslinging, Mr. Member. A very short political memory! He also forgot to tell you that I have called on several offices in Vancouver — mining companies, gold companies, et cetera.

So, Mr. Member, yes, indeed, I happened to be in Victoria, and again I explained to the member who was the then Minister of Highways the need and the urgency of building that road so that the people of British Columbia again could take advantage of the exploration moneys that were being spent in there. It wasn't until last summer or late fall that there was access into that area so that the people of British Columbia could share the money.

Now there are still some in the south part of the coal area, down in the Saxon property, that is still inaccessible for British Columbians. That money is being siphoned off into the neighbouring province of Alberta. But I'm not a separatist like some of the members there when they start talking about people from Alberta.

The member also brought up a subject — and I've seen this game played in this House before — about tabling your campaign donations and who they were from. The member full well knows that I don't know who my campaign donations were made by. They're made to my fiscal agent, and the member knows that. I would suggest that if he wants to get into this game, he'd better bring in legislation and treat everybody equally. I don't know who made campaign donations.

But you want to keep going, and that's why I'm pleased, Mr. Member. I would suggest that the members opposite who wish to play this Grizzly game might be walking further into their own pot of glue, because the public is not entirely stupid. The public will be very much informed about this when the light of day shines in on this whole Grizzly mess.

Mr. Chairman, maybe the light of day will shine out. Maybe we should ask that member for Vancouver East, who stood so piously in this House and talked about share values, if he would care to reimburse all of those little people who held shares in various corporations, mining companies, lumber companies, telephone companies, and everything else when he was in government in this province. Many of them lost their savings. Oh, it's so easy for the members to be so pious! I say we must not forget the number of letters we used to get in opposition about people who had their life savings, expecting the economy of this province to carry on.... That government over there killed the stock market, put the death knell to many industries and cost many investors in this province untold millions and millions

[ Page 791 ]

of dollars.

But I'm not going to be naive or political. I'm not going to stand in this House and ask that member, who was responsible for driving the stocks of many pipeline companies down into the ground, to reimburse them. I think I've answered the member's question.

MR. LEA: I did not ask the minister to reimburse the money to Quasar, or to Cheyenne, or to August. I'm not sure whether he received any money, and he says he's not sure. I would like to ask the minister if it is possible that....

HON. MR. MAIR: It is possible.

MR. LEA: I'm not asking the lawyer for taking money from widows; I am asking....

MR. CHAIRMAN: Hon. member, perhaps the dilemma we are facing now is because we are in breach of a general regulation in the House that in estimates we do not discuss actions for which the minister is not responsible. I think that this would clearly fall into that category. Perhaps you have another question.

MR. LEA: Mr. Chairman, I quite agree with you, but in this case you're wrong. The minister is responsible for economic development in this province, and as such has a very direct responsibility to what I'm asking. Did the minister, who is now the Minister of Economic Development, when he was a candidate for the Social Credit Party, receive any money in his campaign contribution from Quasar, Cheyenne or August, either directly or indirectly? I think it's a simple question. It can easily be settled by the minister filing in this House a record of his campaign contributions. I believe, because of the other ramifications of this question, that the people in this province have a right to those records. He has not answered the question.

MR. L. NICOLSON (Nelson-Creston): Mr. Chairman, I was very interested to hear the minister being a little bit responsive to some of the questions put earlier. I would have hoped he would have responded to this one, which is a very serious question. He could at least give an undertaking to check with his official agent, if that person is still around. He could check into this matter, which is very serious.

I would like to follow up some of the answers given in response to the member for North Vancouver–Capilano (Mr. Gibson). The minister said that he is the politician responsible for the B.C. Railway. Indeed he is, and he sits on the board of directors of the B.C. Railway. He said that he could see no conflict of interest in the Ragan settlement. He said he can't remember how he voted, Mr. Chairman, which leads us to conclude that he did vote on that.

Now the B.C. Railway is a very large corporation, a corporation that can lose up to $70 million in one year. That's a very big operation. We've been told by that minister that it has a very competent board of directors. So I would assume that if it has a competent board of directors, it must most certainly have a conflict-of-interest committee of the board of directors, as does any competent board of directors in business in the North American system. I'm asking that minister, then, to consult and tell us if there is a conflict-of-interest committee of that board of directors. If there is, was this matter brought up and ruled upon by the board of directors?

MR. LAUK: I wonder if the minister can confirm statements made in a Vancouver Sun story. I noticed that earlier in the afternoon the hon. minister refused to discuss the newspaper reports of the Dunhill libel action where it was shown that the minister, when he was a member of the opposition, made statements in this House that were false. The member for South Peace refuses to stand in his place and apologize to the injured parties because he is protected by the privileges of this House.

HON. MR. CHABOT: Look who's talking.

MR. LAUK: The hon. Minister of Mines and Petroleum Resources says: "Look who's talking." Everything I say in this House, I say outside of this House.

HON. MR. CHABOT: "He should be in jail" — you didn't repeat that one.

MR. CHAIRMAN: Order, please, hon. members. The member for Vancouver Centre has the floor.

MR. LAUK: I don't skulk around legislative dining rooms and pick up cabinet files and secret them away to my office.

AN HON. MEMBER: Eh?

MR. LAUK: Have we forgotten that, Mr. Chairman, about the hon. member for Columbia River? Oh, don't forget that.

Interjections,

MR. LAUK: But perhaps the hon. minister....

HON. MR. CHABOT: You apologized for that one too, didn't you?

[ Page 792 ]

MR. LAUK: I did indeed. I apologized for that.

AN HON. MEMBER: Profusely.

MR. LAUK: Profusely, because you are an honourable gentleman — most of the time.

Mr. Chairman, if I could have what little attention the minister has to offer, The Vancouver Sun reports:

"An unnamed cabinet minister says the provincial cabinet has been told B.C. Railway will need $1 billion in capital in the next five years. The cabinet minister said this is one of the major reasons for the decision by Premier Bill Bennett to appoint a royal commission into all facets of the Crown-owned railway.

"Mr. Bennett Tuesday named Mr. Justice Lloyd George McKenzie of the supreme court to head a three-member commission. The cabinet minister said another option for B.C. Rail would be its sale to Canadian National Railway.

"No details were given on the capital expenditures. The cabinet source said the government is concerned that the vast expenditures by B.C. Rail that are anticipated in development of northern British Columbia should be justified. Interest on the $1 billion, which would have to be borrowed over the next five years beginning immediately, would be about $100 million a year. 'We just have to be sure that we know what we are going to be getting into,' the cabinet minister said.

"Among anticipated expenditures are the so-called northwest transportation corridor and possible further expenditures on the now notorious Dease Lake extension.

"J.N. Fraine, chairman of the board of B.C. Rail, said he was not aware of any projections approaching $1 billion."

MR. KING: Who's running the railway — the politicians or the operators?

MR. LAUK: Is he coming right back? You don't know? While the minister has gone to the washroom, I'll just point out, Mr. Chairman, that this is a very serious situation. On the one hand, a judicial inquiry has been appointed and the minister, if indeed he is the unnamed cabinet source — and I don't know of any other minister who sits on the board.... The Minister of Consumer and Corporate Affairs (Hon. Mr. Mair) sat on the board, but he took one quick look at what was happening around him and — he's smart — he was out of there so fast there was a cloud of dust. "Excuse my dust," said Rafe, and out he went. Everybody knows he's one of the smartest ministers on those benches. He owns half of British Columbia.

HON. MR. MAIR: You're evicted.

MR. LAUK: I'm evicted?

We should set up a land claims commission to deal in these lands. If they appoint the Minister of Consumer and Corporate Affairs to sit on a land cut-off commission to deal with Indian bands, it's not because he's a Crown minister; it's because he'll own them and they need to have some word from him.

MR. CHAIRMAN: We are on vote 79, hon. member.

MR. WALLACE: Well done, Mr. Chairman.

MR. LAUK: Thank you, Mr. Chairman. Vote 79 concerns the Minister of Economic Development, who has disappeared.

MR. KING: Who is vacant.

MR. LAUK: He is vacant. Now this Vancouver Sun story has grave implications for the privileges of this House. On the one hand, the attempt was made by the government to silence debate on the scandals of the British Columbia Railway. On the other, this cheesy, sneaky, approach of going to the press as an unnamed cabinet source is totally and completely reprehensible. It is a way to avoid responsibility for carrying on the debate on the subject matter of a judicial inquiry.

I don't know who the unnamed cabinet minister is, but would the real unnamed cabinet minister please stand up and be recognized? If, indeed, it was — and the information seems to indicate and the speculation is that it was — the Minister of Economic Development, he has an opportunity today to stand up and either deny it or explain his statements to the press. In particular, did he say that an option would be to sell the British Columbia Railway to the Canadian National Railways? Is that the option? He denied that there were any negotiations taking place. He said that in the House the other day.

They've mortgaged all of the hard-earned assets of the British Columbia government inside of 14 months, burying the possible revelation of their ineptitude in dealing with the finances of this province. They've mortgaged the ferry fleet. Who's going to pay for that, Mr. Chairman?

MR. NICOLSON: They just pawned it.

MR. LAUK: We have a bill that's coming before the House — and it's improper of me, Mr. Chairman, even in committee, to refer to a bill before the House — to extend the borrowing of B.C. Hydro to $650 million. Now we have this unnamed cabinet minister. And I certainly hope it isn't because there shouldn't

[ Page 793 ]

be this kind of hiding behind "unnamed cabinet ministers" and "unnamed cabinet source." This is disgraceful. It's speculative that it's the minister himself.

AN HON. MEMBER: Who else?

Interjection.

MR. LAUK: Oh, the Minister of Forests says: "Close your mouth." This is the quality of debate.

MR. NICOLSON: The master of wit and quick retort.

MR. LAUK: "Close your mouth," he said. I'm sure you'd like us to close our mouths — through you, Mr. Chairman, to the minister. But the hon. Minister of Economic Development has to answer these questions. Is he the unnamed cabinet minister? If so, does he consider it good propriety for a cabinet minister to skulk in the halls and whisper these little secrets to avoid the rightful accusation that he would be improperly discussing matters that were referred by his government to a judicial inquiry? Was he being candid? If it was the Minister of Economic Development, was he being candid the other day when he said that we weren't negotiating to sell to the CNR? He's got to answer those questions.

He says there is no political interference with the railway. That's what he said. He said: "We've appointed a new board, and Mr. Frame is wonderful and above reproach." But he also says — if he's the unnamed cabinet minister — that we're going to need $1 billion in five years at an interest rate of $100 million a year to keep the railway going. Mr. Fraine says — and this is a man who is above reproach, remember, the man we shouldn't attack because he is devoting his skills and ability to the railway — he's never heard of it. He says he doesn't know what the minister is talking about, or whoever the unnamed cabinet source is.

The minister hasn't been too ready to give answers in this committee and yet, if he's the unnamed cabinet source, he seems very willing to be "an unnamed cabinet source" quoted liberally in the press. And the minister should direct his attention to it.

Has the minister also had the opportunity to check the minutes of the board of directors' meeting for the British Columbia Development Corporation and tell us if the minute approving the purchase of the 9.8 acres in his constituency from Canadian National Telecommunications was acted upon by the British Columbia Development Corporation? He said they didn't purchase it. All right, was the minute acted upon in any other way? Or would he like to change his story now? Has BCDC bought the land, and if so, isn't it true that BCDC bought the land and will sell it at cost to the city of Dawson Creek — in his riding — so that the city can make land speculation profits using provincial taxpayers' money?

He hasn't answered that question. But I think it is serious and I think that the minister should answer both those questions. We've got all the time in the world.

MR. NICOLSON: Mr. Chairman, I was pleased to see the minister consulting with the senior officer of the B.C. Railway. I would have hoped that he would have refreshed himself concerning the presence or the non-existence of a conflict-of-interest committee with the B.C. Railway. It's a practice which is very common, pretty well standard, with professional boards of directors. I've heard the minister explain to us what a fine board of directors they do have on the B.C. Railway. One can only assume this is the case, and if this is the case, they certainly would have a conflict-of-interest committee. Was this matter of the settlement with the construction firm in the minister's own riding referred to, since the minister indicates that he did vote? Since he did vote — whether he voted for or against — it certainly should have been cleared by the conflict-of-interest committee.

I'd ask who the secretary to the board was. Was the secretary of the board present and was that put into the minutes? Could we have the minutes of that meeting? What is the minister trying to hide?

Here in the Victoria Times — today's paper — it's talking about secretive government at the federal level, the local municipal level and also here at the provincial level. This is a very serious matter.

The Minister still has not got up and given an unreserved apology in this House for the harm caused by the irresponsible accusations which he brought into this House when he claimed he had a prima facie case of insider trading surrounding the Dunhill Development acquisition by the provincial government at that time. Mr. Bannerman, his source of information, and his radio station have given an unreserved apology. They have paid, perhaps, what is a token amount of $1,000 to each of the four aggrieved parties — people who, Mr. Chairman, should be admired by that minister, some of whom came to this country, started work as farmers and have made profit — the motive that that minister extols as being the greatest virtue and the only route to economic stability. I would think that that minister owes an apology not only to those four persons but also, I think, to the entire business community which he tries to champion. He says that he represents small business also as the Minister of Economic Development, and that's the reason why he should have been involved in that Ragan settlement.

But I ask the minister: is there a

[ Page 794 ]

conflict-of-interest committee on the B.C. Railway? It should be a subcommittee of the board of directors. And if there is such a committee, was the matter of his involvement in a vote concerning this construction company in his riding brought up? Suppose the roles were reversed. I would like to ask the minister to suppose that a similar circumstance had taken place in 1973, back when that minister used to come into this House claiming to have prima facie evidence, claiming to have such evidence which has been shown in court and admitted in court to be thoroughly false, making accusations concerning not only the four persons who received that unreserved apology but even casting aspersions upon a secretary at a very renowned law firm, dragging her name into this at that time. It was reported; her name was reported.

Does that minister not have one slight memory of how he looked at things when he was on this side of the House, when in fact he didn't have evidence of such a thing, when he told us how he would do things if he were in power? And there he is today. He sits there today; he has intervened in so many different areas. It appears he's had a very loose mouth, not in keeping with a person of his very confidential office.

All that has been asked is that he get up and apologize. You certainly don't have to apologize to me, Mr. Minister, but I would certainly like to see you show that you have some measure of fair play, some measure of decency and some shred of self-respect by which you could swallow your pride and get up, make a disavowal of the remarks that you made at that time and apologize for the very distressing effect of the things which you brought upon those people.

Mr. Chairman, this is the minister who says: "I am the politician responsible for the B.C. Railway." I assume he is the politician responsible for the B.C. Railway because he sits on the board of directors of the B.C. Railway. I want to know if that minister still sits on the board of directors of Swan Valley Foods. I want to know who the present directors of Swan Valley Foods are. I also want to know when Swan Valley Foods last held an annual general meeting. What is the current list of officers?

I see he is consulting with the Minister of Agriculture (Hon. Mr. Hewitt). Maybe the Minister of Agriculture is on that board; maybe the Minister of Labour (Hon. Mr. Williams) is still on the board, and maybe he isn't.

I want to know when an annual general meeting was last held. I want to know if an audited statement was given to that meeting. Was there an election of officers? Who are the present officers? Is the government attempting to sell its interest in Swan Valley Foods, which I think it is? If so, how are they doing that? Is the minister advertising a food-processing plant for sale? Does he have an agent? If he has an agent, who is the agent? So I'd like to know what positions he holds, and not only who the directors of Swan Valley Foods are, but who the officers are. When was the last annual general meeting held? Who was elected at that time?

Finally, I would like to remind the minister that a very serious question has also been asked on the B.C. Rail situation. Is there a conflict-of-interest committee or subcommittee of the board of directors? Did they consider the Ragan settlement?

MR. C. BARBER (Victoria): I wonder if the minister might give his favourite signal and indicate whether or not he intends to leave the room shortly, in which case I would be happy to hold my peace.

No? Well, all right.

I was very interested in the debate yesterday afternoon.

Interjection.

MR. BARBER: I think I was just asked a very odd rhetorical question; which the minister may care to repeat.

I think we have observed that this minister is in some fairly considerable difficulty as he staggers from scandal to scandal and blunder to blunder. His department, to coin a phrase, seems to be under the control of others running investigations and operations for him. I know one of my colleagues will be developing that shortly.

I'd like to develop some arguments that demonstrate, I think, quite clearly to business people on Vancouver Island that this minister is in charge of some of the most stupid and primitive economic development policies this province has ever seen. I'd like to know who has confidence in this man. Certainly this House does not.

AN HON. MEMBER: No one!

MR. BARBER: Certainly it's becoming increasingly clear that his own party does not. It has become increasingly clear to me that members of the business community in greater Victoria, and most certainly on Vancouver Island, do not.

We thank our lucky stars, Mr. Chairman, that B.C. Rail does not run a line on Vancouver Island. At least we have that going for us; at least the minister is not directly able to bungle that one as well. However, the policies of his government, stupid and primitive as they are, poorly defended by that minister, have had an impact on Vancouver Island. It is those policies I wish to discuss.

During the last campaign, Mr. Chairman, and throughout the life of that coalition, short as it certainly will prove to be, that minister has posed as one of the kingpins of that administration. Sure

[ Page 795 ]

enough! He's the guy the Premier talks to. He doesn't take him to Ottawa with him, but he talks to him. Sure enough! He's the guy Arthur worked for, and, boy, if that ain't the sign of a kingpin I guess nothing is. Sure enough, the kingpin turns out to be something quite different. Yesterday afternoon, referring to page 798-2 of the Blues, the kingpin proved he was a hatpin. The kingpin turns out to be a hatpin — if I may follow the analogy — because he exploded one of the myths and he didn't intend to.

You know, this coalition — that group of millionaires over there — proposed and promoted and promised that they would take the province overnight on the road to recovery; that having been in such desperate straits and such ruin that overnight, under Social Credit and the millionaires, things would get better. For the last year they've been trying to tell people of British Columbia that things are getting better all the time.

Sure enough, the kingpin's a hatpin, and he explodes when he himself says: "Mr. Chairman, the depression we have in this province today can be cured by profits of the industries of this province." Well, it's not terribly grammatical, as usual, but he gets more or less his message through and so do we. The depression we have in this province today, he finally admits, is there.

The man explodes it himself. The Quasar Kid — the Hatpin Kid — finally comes through and admits what we've known for a long, long time. Because of the stupid and primitive taxation policy of this government you have crippled small business. You have put people out of work. You have damaged tourism on this island almost beyond repair. You tell us you're on the road to recovery when, for a momentary slip of it yesterday afternoon you confess: "Mr. Chairman, the depression we have in this province today can be cured by profits of the industries in this province."

MR. CHAIRMAN: Hon. member, you'll help us maintain order if you address the Chair.

MR. BARBER: Thank you, Mr. Chairman.

MR. LAUK: There are 112,000 witnesses to that.

MR. BARBER: On Vancouver Island, this government, promoting the most notoriously stupid and primitive fiscal policies we've seen for a long, long time, has seen the failure after failure, bankruptcy after bankruptcy, of business associated with tourism, associated with recreation, associated formerly with that government — but no longer as its political supporters.

Does this minister realize just how stupid his economic policies are, how destructive those policies are? Does he have any idea how primitive and backward and ill-regarded they are by virtually every other jurisdiction in Canada? Does the minister have an idea of the extent to which his ministry has become a joke in this province? Economic development, indeed! There are 112,000 people unemployed, and the minister tells us that he's doing stuff,

I have some sympathy for this minister, Mr. Chairman, because he's preoccupied with scandal. He's preoccupied with maladministration. He's preoccupied with bungling. And he's having a hard time addressing his attention and his thought and his energy to the real problems and to the real dilemma faced by this province, because he's too busy trying to save his political career. The reason he's had no time to consider I quote an eminent authority, the minister himself the depression we have in this province today is because he is preoccupied by the incompetence, by the results of the stupidity and by the results of the bungling of his own maladministration.

This minister is in serious trouble, Mr. Chairman. He may not be the minister by the end of the session. There are people in Victoria who are waiting tonight for the minister to announce a decision about Oakland Industries. The minister has known since January. The minister first met in the third week of January and says he's been having meetings in the last few days about the fate of an organization upon whom some 300 people, at maximum, depend for their livelihood.

The minister has been unable to turn his attention and energy to this problem because he is pre-occupied with saving his political career. He's preoccupied with the black clouds that hang over him. That's why we've gotten no reaction and no results.

On behalf of those 300 people waiting for word about whether that minister can put aside his preoccupation with his political career for a moment and do something about their problem.... We're waiting for word. Are you going to do anything for them? Are you going to put them back to work? Are you going to help to save the business? Are you going to honour an otherwise unbelievable commitment to small business in this province? Are you going to do anything? What are you going to do? When are you going to do it? How much longer will you keep them hanging? Why have you been keeping them hanging at all? Are you prepared to put these people back to work?

People at Oakland Industries have been on the phone to me — and, I presume, to other representatives in greater Victoria — since Saturday morning, waiting for reaction and response and waiting for a positive decision from the so-called Minister of Economic Development.

We want to know what this government is going to do in favour of the people of Vancouver Island. The

[ Page 796 ]

minister may care to join me sometime, not merely walking down Fort Street to talk to the line-ups of unemployed people waiting outside the Canada Manpower centre for work, but in going down the Gorge Road — 1A as it's sometimes known in Victoria — where he will see motels, businesses that once thrived, being turned into condominia. According to my information, there are three on the Gorge Road, two of which are presently under reconstruction. They're being turned into condominiums and being turned into apartment sites because they can't make it as motels, thanks to the stupid and primitive economic decisions of that group of millionaires over there and thanks to that minister who's taken no action ever on their behalf, except to protect us from B.C. Rail — at least we don't have that on the Island.

Thanks to that minister, the economic base of greater Victoria is being diminished day by day. We once had Bapco Paint — and that is gone long ago. We once had the Baker bricks suppliers, and that has gone long ago. It was too bad that nothing could have been done about it.

That minister has come in promising to do something. That minister is silent in the face of the dismissal of that maximum of 300 persons from Oakland Industries because he is preoccupied with his own political career and unable to take any positive action whatever on their behalf. That minister sits on the government benches and tells us that he supports the decisions of his government which have resulted already in the last six months in the conversion from motels to condominia of previously prosperous tourist enterprises which didn't survive the summer thanks to the stupidity of their fiscal policies.

Now I know, Mr. Chairman — because that minister tells us he did reports and does reports and is planning future reports — that they must have done some reports about the impact of their economic decisions on small business and people on Vancouver Island. So I'm going to ask him to table those reports.

I know that they wouldn't have raised the sales tax by 40 per cent without assessing in advance, through an economic impact study, the results of that to the people of Vancouver Island. I would like the minister to table the study. I know they wouldn't have made a decision in the dark; the minister is not that inclined. I know that they look forward, that they engage in long-range planning. I know they consider carefully every step they ever take. I know they must have conducted those studies. I would like the minister to table it. And when you do so, table as well the name of the author, the date of its authorship and tell us how much you paid for the study.

Secondly, I know that they would not, Mr. Chairman — because they claim to be businessmen — have made a decision to double the B.C. ferry rates without conducting an economic impact study on the results of that as far as the people in businesses of Vancouver Island are concerned. I know that minister — because he is a thinker and a planner — would have conducted that study, and it's unfortunate he has not referred to it much in this debate in his defence. But I'm convinced the study must exist. Surely they would not have taken a decision of that magnitude without conducting such a study, and I would like the minister to table it. Tell us how much it cost, tell us who wrote it, tell us when it was produced. Let us know and have confidence that indeed they did not make a decision of that magnitude without conducting the economic impact studies that the minister tells us he conducts.

That coalition is in serious, political trouble on Vancouver Island, Mr. Chairman.

MR. D.F. LOCKSTEAD (Mackenzie): On the whole coast.

MR. BARBER: On the whole coast indeed, as my colleague from Mackenzie reminds me. The economic decisions they've made and which that minister has endorsed, stupid and primitive as they are, have blown up in their faces.

A newspaper in Victoria published today indicates: "NDP Back in Favour?" A poll they commissioned indicates that 63 per cent of the people in Victoria would vote NDP tomorrow; 23 per cent would vote for the millionaires; the rest is shared largely by the Conservative Party and the remainder by the Liberals. It's just one more indication that they are in trouble on this island, and no amount of plagiarism of other people's ideas about Captain Cook or other celebrations will help them out of their trouble.

MR. WALLACE: Look out for the Tories. We're coming up!

MR. BARBER: None of those things, no such plagiarism will help them out of their present difficulties. They're in trouble because of a series of stupid and primitive economic decisions made by that government and endorsed by that minister.

I'd like the minister to table a few more reports. I'd like the minister to table the economic impact report, which no doubt they produced, to indicate the impact on the spending power and the purchasing power of the people of British Columbia when they tripled and quadrupled ICBC rates. I know the minister isn't a fool, at least so I'm told. I know the minister would not have agreed to such a decision without conducting an economic impact study into the likely result of it. I want him to table the study; I'd like to read it. I'd like the minister to do that.

And before he gets up to table those studies, I'd

[ Page 797 ]

like him to tell us what he's going to do about the 112,000 unemployed, about the 300 people, at maximum, presently unemployed at Oakland Industries. I'd like the minister as well to table the rest of the studies that indicate the serious and scientific way in which that government made fiscal decisions to destroy small business on Vancouver Island.

HON. MR. PHILLIPS: There's a lot of talk about unemployment. Employment figures, as you know, can be twisted around, but I want you to know that the labour force in the province of British Columbia grew by 35,000 people in the year 1976, while 1975 was a year of practically no growth whatsoever. I want to tell you, Mr. Chairman, that those 35,000 jobs were created because of the dynamic new policies of this Social Credit government.

I want to tell you further, Mr. Chairman, the employment created in this province per 1,000 people was 16 last year — better than all other provinces in Canada. Every economic indicator in Canada, every economist in Canada, all the people who do surveys on investment say that the bright spot in Canada so far as the economy is concerned is British Columbia.

Last year B.C., with 10.9 per cent of the population in Canada, had 12.9 per cent of the labour force and had 13.9 per cent of the jobs created last year in Canada. That is a great victory for the new Social Credit government. I want to tell you, it's the dynamic policies of this government that bother them over there.

Mr. Chairman, when the Minister of Labour (Hon. Mr. Williams) was speaking the other night in this Legislature he reminded that group over there about the unemployment figures last year, but it just went over the top of their heads. I'd just like to briefly read again the figures for the entire year of 1975: January, 7.9 per cent — this is when the NDP were in power; February, 9 per cent; March, 8.8 per cent; May, 8.5 per cent; June, 8.2 per cent; July, 8.1 per cent; September, 9.1 per cent.

AN HON. MEMBER: Down!

HON. MR. PHILLIPS: Oh, it was going down, was it? How come it came up in September to 9.1 per cent? October had 9.8 per cent, and so on.

I'll tell you, Mr. Chairman, this province is on the move!

MS. K.E. SANFORD (Comox): Down, down, down!

HON. MR. PHILLIPS: You know, Mr. Chairman, there are a few other figures that I'd like to take the time of the House to discuss tonight, figures that are the direct result of the dynamic policies of this government.

MR. D. BARRETT (Leader of the Opposition): Okay whoop it up again, gang!

HON. MR. PHILLIPS: Let's look at the number of drilling licences issued. In 1974 there were 144; in 1975 it went down to 100. What happened in 1976? Mr. Chairman, they're up 95 per cent to 195.

MR. LAUK; Fantastic! Any gas?

HON. MR. PHILLIPS: But what happened under Social Credit in 1976? There were 182 wells drilled, an increase of 125 per cent.

Now you've heard me, Mr. Chairman, speak in this House before about creating an artificial shortage of natural resources, because if you don't look for them you'll never find them. I've said along with the now Minister of Mines and Petroleum Resources (Hon. Mr. Chabot) that there was gas and oil in British Columbia. Let me tell you what happened. There were six oil wells established in 1974, and in 1975 there were two. Do you know how much the increase was in 1976 under this government?

MR. BARRETT: Get ready to applaud, gang!

HON. MR. PHILLIPS: There was a 500 per cent increase in wells established!

Gas wells established: in 1974, 51; in 1975, only 31.

MR. BARRETT: Get ready again, gang! Give them the signal, Garde. Get ready!

HON. MR. PHILLIPS: Remember, we had a shortage of natural gas. The socialists were telling us we were running out of gas: "There's no more gas." Even in this report that I referred to, Fort St. John and Fort Nelson are going to fold up because there's no gas in the area.

HON. MR. CHABOT: Doom and gloom!

HON. MR. PHILLIPS: What happened in 1976, my friends?

AN HON. MEMBER: Tell us!

MR. BARRETT: Get ready!

HON. MR. PHILLIPS: There were 92 gas wells established, an increase of 197 per cent.

SOME HON. MEMBERS: Now!

[ Page 798 ]

MR. BARRETT: Fantastic!

HON. MR. PHILLIPS: Mr. Chairman, I could go on and on, but I want to ask the opposition a couple of questions.

MR. BARRETT: Certainly. Go right ahead.

HON. MR. PHILLIPS: We've had a lot of talk about fraud on the BCR; we've had a lot of talk about contracts being let; we've had a lot of talk about increased costs. We heard the former Attorney-General and the former Premier screaming for a royal commission because there was fraud surrounding the MEL Paving case. They say they wouldn't settle it. Mr. Chairman, I want them to answer me: why did they settle with Keen on December 10, 1975, one day before the election? Why did they settle with KRM?

MR. BARRETT: Is it my turn?

HON. MR. PHILLIPS: Ohhh! Now let me remind the House....

Interjections.

MR. CHAIRMAN: Hon. members, order, please. The minister has only a few minutes before adjournment time. Let's listen to him.

HON. MR. PHILLIPS: ...KRM and Keen contracts let 1971, 1972; MEL contract let under the same conditions in 1972, but when MEL came to the government: "Oh, no, we're not going to.... See you in court, boys!"

MR. LEA: But not for long.

HON. MR. PHILLIPS: Yet just over a year later, Mr. Chairman, they settled: $1,737,000 operational claim, $1,146,299 remeasure claim, for a total of $2,883,299. And yet they build up in this province, and in the eyes of the public, a case of fraud and squandering and increased costs and people running to the trough.

MR. BARRETT: It's bothering you, huh?

HON. MR. PHILLIPS: Why did they settle one day before the election? I ask the people of B.C. to take that into consideration. Not only did they settle past claims, but they renegotiated the contract. They renegotiated the contract, but would they renegotiate with MEL? "No, boys. See you in court." Fraud, squander, allegations, pulling the management of that railway into the gutter, pulling the directors themselves into the gutter.

What did they settle for? Oh, it's very interesting. They renegotiated the contract. A general increase of 56 per cent on all unit prices, except rock...

MR. BARRETT: Now you're in the glue, partner.

HON. MR. PHILLIPS: ...and an increase of 62.8 per cent on solid rock. Oh, but they would build up, and the Attorney-General (Mr. Macdonald) would stand in this House, and the member for Vancouver Centre (Mr. Lauk), who was a director, would talk inside and outside of this House about fraud, and squander, and royal commissions, and investigations.

MR. BARRETT: Is that going to be in front of the royal commission, Garde? Yes or no, Garde?

HON. MR. PHILLIPS: Oh, my gracious, Mr. Chairman, I know that the people of British Columbia will want them to answer all of these allegations, pulling names down into the mud, building up a great big mystique about something that wasn't there, building a pie in the sky.

HON. MR. CHABOT: A bunch of alley fighters.

HON. MR. PHILLIPS: No, they're not alley fighters, Mr. Member, but I must impress upon you, Mr. Chairman, the same circumstances, the same contract, the same terminology, the same area, the same lines....

MR. BARRETT: Let's check it out at the royal commission.

HON. MR. PHILLIPS: Oh, sure. Sure, Mr. Chairman, let's check it out at the royal commission, but before, no — they didn't want a royal commission. Oh, my gracious, Mr. Chairman, how they dig themselves into the gluepot.

I want to tell you, Mr. Chairman, that if we had done that poor a job when we were in opposition they would have run us right out of the country. They've been grasping, they've been trying to clutch onto something this session, and unfortunately they can't come up with a thing because this government is an open government. This government is an honest government, and this government has great development policies. They talk now, but when the economy gets rolling, they'll be sitting over there stewing in their own glue — caught in their own gluepot, Mr. Chairman.

The House resumed; Mr. Speaker in the chair.

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

[ Page 799 ]

Hon. Mr. Phillips tabled the report of the Department of Economic Development for the fiscal year ending March 31, 1976.

MR. WALLACE: Mr. Speaker, on a point of order, during committee proceedings the minister, in replying to one of my questions, provided the information regarding the creditors involved in the Ragan corporation settlement. The minister stated that he would be glad to table the documents after checking with his legal adviser — presumably the Attorney-General (Hon. Mr. Gardom) — as to the propriety of tabling these documents. I wonder if the House could now learn whether the Minister of Economic Development and the Attorney-General have decided to table that information.

MR. SPEAKER: Order, please. Speaking to the matter that you have just raised, first of all, it is an improper point of order. Certainly if you feel that you wish to pursue the matter in Committee of the Whole House when we are back in the minister's estimates again, I am sure that you will do so.

Hon. Mr. Gardom moves adjournment of the House.

Motion approved.

The House adjourned at 5:57 p.m.

APPENDIX

8 Mr. Cocke asked the Hon. the Minister of Education the following questions:

With reference to auto insurance fraud—

1. What are the names, salaries, and previous occupations of the ICBC fraud investigators?

2. Were any persons formally charged with defrauding ICBC on auto insurance claims during 1976?

3. If the answer to No. 2 is yes, (a) how many, (b) what was the total amount involved, and (c) were any convictions obtained and if so what was the total amount involved?

The Hon. P. L. McGeer replied as follows:

"1. Ken Aguilon, Reg Blackmore, Fred Bodnaruk, Jim Campbell, Robert Sault, Walter Tyrell, Art Wafler, and Don Sandberg were all previously with the R.C.M.P. Provision for publication of employee's salaries is not provided for in the Automobile Insurance Act, enacted in 1973, or in the Public Bodies Financial Information Act.

"2. Yes.

"3. (a) There were 76 formerly charged; however, it should be noted, that in approximately 85 per cent of cases where the corporation is satisfied that fraud has occurred, settlements are obtained without formal charges being laid by the Crown corporation; (b) $118,234; and (c) yes, 26 convictions were obtained, amounting to $44,295. Since most cases involving a suspicion of fraud are settled, the savings to the corporation, and thus, to the public, are many times that figure."

[ Page 800 ]

9 Mr. Cocke asked the Hon. the Minister of Education the following questions:

With reference to private insurance companies licensed to sell automobile insurance in British Columbia—

1. How many companies are licensed?

2. In the case of each company, what is the name of the company and in what country is the controlling interest held?

The Hon. P. L. McGeer replied as follows:

"1. There were 152 companies licensed as at December 31, 1976.

"2. The name of the company and the country of controlling interest, as per the schedule attached, submitted in reply to Question No. 60, was replied to June 30, 1976, except for the addition of Employer Mutual Casualty Company of the United States."

55 Mr. Cocke asked the Hon. the Minister of Education the following questions:

1. Were any bond issues authorized by the Government in 1976 for school construction?

2. If the answer to No. 1 is yes, (a) what was the total amount of those bonds floated, (b) when were they issued, (c) what was the amount of each issue, and (d) what was the interest rate of each issue?

The Hon. P. L. McGeer replied as follows:

"In 1976 there were 11 debenture sales authorized for the Government pertaining to school construction. The following table details the answers to No. 2:

School Districts and Colleges Debenture Sales, 1976