[ Page 971 ]

CONTENTS

Routine proceedings

Tourist Accommodation Act (Bill M 204) Mr. Lauk.

Introduction and first reading –– 971

Oral questions

Reduction in gas field prices. Mr. Macdonald –– 972

Licensing of coal lands. Mr. Gibson –– 972

Alleged ICBC sweetheart deals. Mr. Cocke –– 972

Home and School Association grant application. Mrs. Dailly –– 973

Out-of-court settlement with William Ozard. Mrs. Dailly –– 973

Youth employment program- funding for Kitasoo band. Mr. Lea –– 974

Categories of corporations filing under Corporation Capital Tax Act.

Hon. Mr. Wolfe replies –– 975

Presenting reports

Select Standing Committee on Agriculture, two reports. Mr. Bawtree –– 975

Committee of Supply; Executive Council estimates.

On vote 5.

Hon. Mr. Bennett –– 975

Mr. Barrett –– 978

Hon. Mr. Bennett –– 978

Mr. Barrett –– 980

Hon. Mr. Bennett –– 983

Mr. Barrett –– 985

Mr. Gibson –– 988

Mr. Stephens –– 991

Mr. Barber –– 995

Mr. Barrett –– 1000

Mr. Barber –– 1001

Hon. Mr. Bennett –– 1006

The House met at 2 p.m.

Prayers.

MR. COCKE: Mr. Speaker, on behalf of the official opposition I would like to welcome the Home and School Federation to our galleries today. They've been visiting, I understand, with the Minister of Education (Hon. Mr. McGeer) They visited with our caucus and we're happy to have them. They're a hard-working group of people and we're certainly very supportive of that group.

HON. MR. McGEER: I too would like to welcome the representatives of the Home and School Federation. At the same time, I would like to draw the attention of the House to a group of exchange teachers who are with us today. British Columbia exchanges teachers for a year with a number of jurisdictions. Today we have representatives from Australia, the United Kingdom, the United States and Ontario, and I would like the members to bid them welcome.

MR. LAUK: Mr. Speaker, four people with the Home and School Federation group from Sir Alexander Mackenzie got up at 4 a.m. to be here today: Mrs. Schwarz, Mrs. Fitch, Mrs. May and Mrs. Buchanan. Could we give them a special welcome?

MR. KERSTER: Mr. Speaker, I would like to introduce to the House a constituent and a friend, Mrs. Ona Mae Roy, who is the provincial president of the parent-teachers association, along with 10 representatives from district 43 in Coquitlam who are in the members' gallery today. For once I agree with hon. member for New Westminster (Mr. Cocke) ; they are a very hard-working group and I echo his welcome to all representatives of that association.

MR. SKELLY: I would ask the House to welcome a group of secondary school students from Ballenas Junior Secondary School in Parksville, B.C. They're here under the direction of their teacher, Mr. Eric McMurray, and their bus driver, Mr. Stan Jowsey.

HON. MR. NIELSEN: Mr. Speaker, in the gallery today is a former alderman from the municipality of Richmond and mayoralty candidate in the last election - 1 ask the House to welcome Mrs. Irene Vennard.

MRS. WALLACE: I would like to add my welcome to the representatives of the Knowhemun School from Cowichan School District, headed by their president, Mrs. Anne Murray, and also to welcome to the precincts today one of the largest groups of -.students ever to descend on the Legislature, I believe. There are a total of 84 students visiting the precincts today - 41 from Montreal and 43 from Duncan. The Montreal students are part of the Open House Canada exchange programme, funded by the federal government, and they have been visiting in Cowichan-Malahat since last weekend and will be here for a total of one week. They are anglophones, they are visiting the museum, they're going to the Empress, they're seeing various organizations and groups throughout Cowichan-Malahat, and I'm sure the Legislature would like to join me in welcoming them.

MR. KAHL: I notice in the gallery a colleague of mine whom I taught school with at Rock Heights, a constituent of mine, and a good friend - Miss Marg McKerr - and I'd like the House to bid her welcome.

MR. BARRETT: Mr. Speaker, in the gallery today I have three very important guests: my aunt from Los Angeles, Mrs. Hyath; a very good friend of our family, Mr. Harry Gordon from Chester, West Virginia; and most important, my mother is viewing the proceedings again.

MS. SANFORD: Visiting the Legislature for the first time are two young people from Quadra Island. I would like the House to join me in welcoming Janice Monks and Brad Miles.

MS. BROWN: Mr. Speaker, although my Aunt Mary has been living in this city for many, many years, this is her very first visit to the Legislature, and I got her a special seat so that she can keep her eyes on both of her [illegible] - this one she refers to as "young Charlie". Would the House join me in bidding her welcome?

MR. MACDONALD: Mr. Speaker, last but not least, I want to introduce an NDP constituent, a member of the NDP from Vancouver East, a graduate of the Vancouver Vocational Institute, Mr. George Lawson.

Introduction of bills.

On a motion by Mr. Lauk, Bill M 204, Tourist Accommodation Act, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

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Oral questions.

REDUCTION IN GAS FIELD PRICES

MR. MACDONALD: I have a question to the Premier. The word from the Peace River country is that the gas-producing companies have been asked by BCPC to cut back production by 50 per cent because the gas cannot be sold. As this is a deeper cut and coming earlier in the season than usual, will the Premier reconsider the substantial hikes in field prices that his government gave the oil and gas companies on January 1,1977, and then again on November 1,1977?

MR. SPEAKER: The question anticipates future government action, but the Premier may wish to answer.

HON. MR. BENNETT: Mr. Speaker, I haven't heard the rumours or stories that the member referred to coming out of the Peace River country, so I will take the question as notice.

MR. MACDONALD: Mr. Speaker, I must say I confirmed the information in Vancouver as well. I want to ask: having given an extra $120 million a year to the gas-producing companies in the Peace River, which has been passed on to the consumer, through these quite needless increases in field prices, does the Premier intend to do anything about the reduction in BCPC revenues that will come about because of this unmarketable surplus of gas? .

MR. SPEAKER: The question anticipates future government business. The Premier may wish to answer.

HON. MR. BENNETT: Mr. Speaker, I would say also in answering that recommendations for field prices are made by the Energy Commission of British Columbia, a structure that ums there during the last government. But I will take that question as notice.

LICENSING OF COAL LANDS

MR. GIBSON: I have a question also for the Premier. The Minister of Mines (Hon. Mr. Chabot) yesterday seemed unconcerned that since his announcement on February 10, almost as much coal land has been applied for licence as in all of B.C.'s history up to now. This is most of our remaining good coal land. It's gone almost entirely to the large energy companies that already hold most B.C. coal land. Has the Premier been advised of these dangers by the minister or anybody else?

HON. MR. BENNETT: Mr. Speaker, nobody mentioned the right to explore as being a danger in this province, and the member wouldn't try to anticipate future taxation policies which will affect any mines that come into bearing in British Columbia.

MR. GIBSON: A supplementary. Mr. Speaker, on June 2,1977, in Nelson, the Premier announced a new coal policy which provided for bidding for the obtaining of exploration leases. Did the minister's press release of February 10 announcing a new exploration licence policy without bidding have the Premier's approval, as it went in the face of his announcement nine months before?

HON. MR. BENNETT: Mr. Speaker, the government considered applications and the government considered the new announcement before it was made.

ALLEGED ICBC SWEETHEART DEALS

MR. COCKE: Mr. Speaker, I'm asking the Minister of Education a question with respect to ICBC. Since there are many companies rumoured to be looking at B.C. as a hospitable place to merchandise their wares, is ICBC going to make the same-we kind of sweetheart deal with other private companies as they are presently in claims service?

MR. SPEAKER: Order, please. The question anticipates future policy, but the minister may wish to answer.

HON. MR. McGEER: Mr. Speaker, ICBC has not in the past, is not now, nor will it in the future, engage in any sweetheart deals with any corporation, insurance or otherwise.

I might explain to the hon. member, Mr. Speaker, and to the House that since ICBC carries liability insurance for all licensed vehicles in British Columbia, any claim involving an automobile will necessarily involve ICBC. So it is in the interests of ICBC to do the adjusting and see that it is done correctly.

MR. COCKE: Mr. Speaker, the minister has given us a quarter of an answer, and he certainly hasn't convinced me in any way.

I would like to know from the minister how many companies are presently negotiating coming back into British Columbia, in light of the minister's handling of this situation.

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HON. MR. McGEER: There are something of the order of 140 companies licensed to sell extension automobile insurance in British Columbia. None of them has to negotiate to come back here to do business.

AN HON. MEMBER: The negotiation took place before the election.

MR. COCKE: The negotiation took place with Royal. He can't kid me.

HOME AND SCHOOL ASSOCIATION

GRANT APPLICATION

MRS. DAILLY: To the Minister of Education. Last year for the first time in many years the Home and School Association did not receive a grant from the Ministry of Education. Will the Home and School Association receive a grant this year, and is it true that you informed them there is a distinct possibility they will not?

HON. MR. McGEER: I would be happy to set down the criteria by which the Ministry of Education gives what few grants it is in a position to give. The ministry entertains grant applications from organizations that provide direct education to students in British Columbia, and whose service extends beyond a single school district.

MRS. DAILLY: A supplementary. I understand the minister suggested that grants can only be given to students, not to parents. Is the minister aware of the history and the work of the Home and School Association aver the last 56 years in this province? Would he not say that their work distinctly involves students and the school?

HON. MR. McGEER: Mr. Speaker, I can't speak too highly of what the Home and School Association has done in the past, is doing now and which I hope it will do in the future. I've explained what the criteria are for the grants, which I think are very fair.

SOME HON. MEMBERS: No money. Shame!

HON. MR. McGEER: The House well knows that the government does not have unlimited funds, and it has very many people who are requesting opportunities to have those funds.

OUT-OF--COURT SETTLEMENT

WITH WILLIAM OZARD

MRS. DAILLY: Would the Provincial Secretary please inform the House how much her out-of-court settlement was to William Ozard?

HON. MRS. McCARTHY: Mr. Speaker, it was not my out-of-court settlement. The settlement that is made on the dismissal or the suspension or any action of that kind...

AN HON. MEMBER: Firing.

HON. MRS. McCARTHY: ...is always done through the Public Service Commission. I understand, through the Public Service Commission this morning, that an out-of-court settlement of $4,300 was made.

MR. BARRETT: On a supplementary, I would like the Provincial Secretary to say if she ordered Mr. Ozard's dismissal.

HON. MR. McCARTHY: No.

MR. BARRETT: Was she consulted on Mr. Ozard's dismissal? Whose recommendation was it that he be dismissed?

HON. MR. McCARTHY: Of course I was consulted, Mr. Speaker, by my employees in the ministry.

MR. BARRETT: And who was it that recommended his dismissal?

HON. MR. BENNETT: Witch hunt.

MR. BARRETT: Witch hunt! It's taxpayers....

MR. SPEAKER: Order, please.

Interjection.

MR. BARRETT: I categorically deny that I'm against the minister.

MR. SPEAKER: Order, please.

MR. BARRETT: Mr. Speaker, I ask the minister clearly on whose recommendation it was that Mr. Ozard was dismissed. Obviously it had your approval, because it was brought to your attention.

HON. MRS. McCARTHY: Mr. Speaker, I made it very clear at the time that it was on the recommendation of the Public Service Commission. And it was the recommendation of the Public Service - Commission that they accept an out-of-court settlement.

MR. BARRETT: On a supplementary. What was

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the reason given by the Public Service Commission for the recommendation to you that Mr. Ozard be dismissed?

HON. MRS. McCARTHY: No, I'm not going to reflect on that.

MR. BARRETT: On a supplementary. I asked the question of the minister. You don't want to respond to that question, is that correct?

HON. MRS. McCARTHY: No, I won't respond.

MR. BARRETT: Was it Mr. Currie's recommendation that Mr. Ozard be fired and, if so, has Mr. Currie given that recommendation before he quit or after he quit?

MR. SPEAKER: The hon. member for North Vancouver-Capilano (Mr. Gibson) .

MR. BARRETT: Oh, no, no, no, Mr. Speaker, she was ready to answer.

AN HON. MEMBER: Come on, Grace!

MR. SPEAKER: Hon. members, the Chair can only recognize members who are standing and at the present time I can only recognize....

MR. BARRETT: Okay, on a last supplementary, Mr. Speaker, would the minister tell the public of British Columbia what the reason was that Mr. Ozard was given $4,300 of taxpayers money for only 90 minutes on the job?

HON. MRS. McCARTHY: Mr. Speaker, the dismissal of anyone in the Public Service Commission is done by the Public Service Commission and, as such, has never been a matter of debate in this House because of any reflection it may have on an employee. I refuse to answer something that can be answered by the Public Service Commission.

MR. GIBSON: Mr. Speaker, I would ask if it's anticipated that Mr. Ozard will be publicly thanking the minister for the out-of-court settlement. (Laughter.)

YOUTH EMPLOYMENT PROGRAMME

FUNDING FUR KITASOO BAND

MR. LEA: I have a question to the Minister of Labour who is responsible for Indian affairs. Could the minister tell me whether native Indian bands are eligible for funds under the 1978 provincial youth employment programme?

HON. MR. WILLIAMS: Yes.

MR. LEA: As a supplementary, I'd like to ask the minister why the Kitasoo Indian band council ums turned down and informed by your ministry that they are not eligible for funding.

HON. MR. WILLIAMS: I'm not sure that it is true. If the member would give me particulars, I would be pleased to have it Examined immediately.

MR. LEA: I have a letter signed by Jacqueline Morgan....

MR. SPEAKER: Order, please. This is question period, hon. member.

MR. LEA: I'd like to read the letter so the minister will know what I am talking about.

MR. SPEAKER: That will have to be done at some time other than question period.

MR. LEA: I'd like to ask the minister a supplementary question then. How can you say that the policy of your government is to fund Indian bands under this programme when your ministry is sending out letters saying they are ineligible? How can that sort of administration happen in a ministry of government?

Interjections.

MR. SPEAKER: Order, please. Hon. members, the minister has undertaken to bring a reply to the House.

ALLEGED DISCRIMINATION AGAINST

FEMALE SUPER-VALU EMPLOYEES

MS. SANFORD: My question is also to the Minister of Labour. Bishop Remi DeRoo, chairman of the province's human rights commission, eight months ago requested the minister to establish a board of enquiry into alleged discrimination by the giant Super-Valu against female employees here in B.C. Can the minister explain why there has been no decision yet on this request that was made last September by Bishop DeRoo?

HON. MR. WILLIAMS: Mr. Speaker, that matter remains under examination as to whether it is an appropriate case to be dealt with under the Human Rights Code. In my particular view, it is not, but I am prepared to have the investigation continue.

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SOME HON. MEMBERS: Oh, oh!

MS. SANFORD; On a supplementary question, has the minister, as a lawyer, ever heard or used the phrase, "Justice delayed is justice denied."?

MR. LEVI: To the Minister of Finance, Mr. Speaker. A week ago the minister took as notice a question regarding some information on the Corporation Capital Tax Act. He also indicated to the House he would bring back information on the sale of the ferries, the role of Mr. Chestnut and a number of other things. Could he indicate to the House when he is prepared to reply?

CATEGORIES OF CORPORATIONS FILING UNDER

CORPORATION CAPITAL TAX ACT

HON. MR. WOLFE: I have a reply to your first question today, Mr. Member, and I will bring back, probably tomorrow, a reply on the other questions relating to the ferries.

The question referred to the Ministry of Finance keeping statistics on the financial categories of businesses, and the amounts they pay under the Corporation Capital Tax Act. The answer is: yes, we do keep such statistics. The ministry ran a computer printout and found that there were some 21,216 corporations filing under the Corporation Capital Tax Act with capital in excess of $100,000 as of March 31,1977. The ministry then completed a file selection based on the new criterion -corporations with a capitalization in excess of $500,000 - and found the number to be 6,116. The difference in number, which is 15,100, represents the number of firms now estimated to be exempt from the corporation capital tax.

MR. BAWTREE: I ask leave to table reports.

Leave granted.

Presenting reports.

Mr. Bawtree from the Select Standing Committee on Agriculture presented two of the committee's reports, which were taken as read and received: cross-border shopping out of British Columbia and British Columbia food shopper's attitudes and behaviours.

Orders of the day.

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

ESTIMATES: EXECUTIVE COUNCIL

(continued)

On vote 5: executive council, $753,760 -continued.

HON. MR. BENNETT: Mr. Chairman, last night statements were made about the Premier's office being the most expensive in the country and some allusion was made to members concerned in that office, which now encompasses executive council and, of course, information services.

I'd like to just go through the consolidation that took place because I believe it might be quite logical that the Leader of the Opposition was not in the House in the spring session of 1976 when this was explained. I believe he was sill waiting to come back in the House with arrangements made with Bob Williams.

So, Mr. Chairman, I will make the explanation again of what has taken place.

Interjection.

HON. MR. BENNETT: He didn't have to pay $80,000.

The Premieres office consolidated into it the former office of planning adviser to the cabinet that had been previously set up by the former government to bring some order to their policy and planning. Also added to that were the executive council and the support staff to executive council and a new department of intergovernmental affairs which would coordinate not only the meeting

, , s between this government and other governments in Canada, for which there had been no such coordination, to the detriment of this province and our relations not only with other provincial governments but with the government of Canada, which are well known, but in order to bring a greater degree of efficiency.

Previously, of course, we'd had the office of planning adviser to the cabinet not within the Premier's vote but under the Provincial Secretary's vote, although I understood that the reporting was directly to the Premier of that day. That office cost $276,000. When you add to that the $286,000 of the Premier's office of that time, the fact that some of the staff serving the former Premier, of course, were buried in the Finance minister's office, such as Peter McNelly, who received a salary of $23,710, you'll find that scattered throughout the government service were a number of functions, a network that should have come under the previous Premier's office. In fact, that network wasn't working to consoli

[ Page 976 ]

date government services. one has only to look at the research done on the structures of government, particularly the article by Professor Paul Tennant that was published and made available by the Canadian Public Policy Association, which did a paper on the structures. I would hate to quote all of the suggestions he makes about the lack of organization in the last government and why that government ran into such difficulties, but he lays the blame on a lack of control directly out of the Premier's office. In fact, he mentioned specifically the very weak leadership that was exhibited from that office and the fact that strong ministers ran amok while weak ministers allowed their departments to suffer.

MR. LEVI: Why don't you quote it?

HON. MR. BENNETT: Yes, I will quote it. I was hoping you'd ask. I may have to quote it extensively, but here is one of the quotations from Professor Tennant:

"In British Columbia, the NDP cabinet added no planning capability, and, while retaining the traditional cabinet form, discarded the one means of attaining coordination in that forum. In the absence of both staff support and firm leadership, the NDP cabinet in British Columbia remained little more than a bargaining centre, lacking a collective view of overall government problem ."

I think that theme is continued throughout the paper of Professor Tennant's analysis.

AN HON. MEMBER: Table it.

HON. MR. BENNETT: I'll table it, certainly. Later in the article he says that because of this, there were developed a number of outside agencies beyond the direction of immediate government.

"In all, the NDP established some 25 new agencies outside the regular bureaucracy but subject to the direction of particular ministers. Half a dozen existing non-departmental agencies were completely restructured."

What he says is that the chaos became obvious inside that government, and two years after coming to power:

"The Premier and cabinet did accept an innovation having the potential of introducing a broader planning and coordinating capability. This was the appointment in mid-1974 of a planning adviser to the cabinet. The position was created not because of any general recognition of the work of staff support, but rather because the budgetary crisis of 1974 brought the Premier and cabinet to seek some new method of keeping expenditures in line with revenue."

When we came to government, Mr. Chairman, in fact what we found was chaos and no proper organization for leadership or co-ordination out of the Premier's office. As such, then, we brought in a new section of intergovernmental affairs. As I've said, the intergovernmental affairs relates to the intergovernment departments or ministries, as some of them have become in other governments in Canada. We wiped out the former policy and planning coordinator and incorporated that into the executive council vote so that all of these functions could be co-ordinated out of the Premier's office. In fact the executive council vote provides the staff support for the cabinet committee structure which we set up as a means of providing policy coordination and efficiency that ums lacking. That has been identified in a non-political way by studies done by Professor Tennant. The lack of planning that took place gave us an ideal model of what we did not want in British Columbia. In studying all other governments, we came up with perhaps the most efficient and certainly the least expensive Premier's office in all of Canada.

Now I'd like to point out that we combined in the Premier's office both intergovernmental relations and the executive council office. In some areas, in some other governments of Canada, these votes appear in other departments. But I'll give you an idea. When you add the three votes together in Newfoundland, you find that they cost $1,378, 800. The population there is 564,800, a cost to the people of Newfoundland of $2.44 per capita. In Prince Edward Island, the Premier's office and intergovernmental relations and executive council cost $425,650, for a population of just 121,900 - a cost per capita of $3.49.

I could go on. I could talk about Saskatchewan, in which the cost of the Premier's office, intergovernmental relations and the executive council is $2,035, 000. The per capita cost is $2.16. That's in Saskatchewan. In British Columbia, the cost of the Premier's office, encompassing all of these votes -executive council and intergovernmental relations - is just $753,760, a per capita cost of 29 cents - the most efficient co-ordinating office in all of Canada in relationship with other governments in co-ordinating government policy. I believe when Professor Tennant writes the history of the administration of this government, he will draw the contrast to

[ Page 977 ]

what we found and what we created for the benefit of future governments, because it took some time to provide that organizational structure at such an efficient cost.

When I hear the former leader, the opposition leader now and the former Premier (Mr. Barrett) , talking about the high cost of the Premier's office in British Columbia, I would remind the people of British Columbia what his party has cost in direct costs of that office in Saskatchewan: over $2 million with a much , smaller population and much less activity to co-ordinate and far less economic activity in their province.

I would say we've increased the efficiency and we've brought together the programmes of government that have never been identified before. One of the parts of my estimates, Mr. Chairman, is that of communications planning adviser. One of the things we did in coordinating communications and planning within this vote was to co-ordinate all of the programmes of government. Do you know we found when we came to government that while provinces like Alberta and some others had a directory for the public service of all of the programmes and ministries and who was who, in British Columbia not only did ministries and departments not know what was going on in other departments but in many cases they did not have a proper catalogue of their own services?

The first area we did was a co-ordination of a telephone directory that clearly put names on positions so people could phone into government and know whom they were talking to in the public service and what capacity they had to help them. We've made it easier for people to deal directly with government. We've put names on positions so that people understand how to talk to government without going through the politicians and how to get some information on services that they require.

What I wish to bring forward today, though, Mr. Chairman, is the co-ordinated programme directory which, for us, is a publishing first. It's a three-volume set of programme directories for all members of this Legislature, for the various caucuses, for the government agents around this province, for the administrative side of government. It's a detailed and concise programme directory of government programmes and government services available to people.

On top of this directory, each of the ministries will be separated for handy reference of services within their own ministry. A process for automatic renewal every six months will be undertaken by the information services so that the ministries, government agents and those who deal with the people in the field will understand fully the programme and services available to the people of the province.

I was appalled, in calling at some of the government offices around the province, to find that no such catalogue of services exists. Many of our citizens are frustrated going to government offices to find out that there isn't a common directory in which one person could easily identify the services they require from government, whether it's under health care, human resources or the Attorney-General. We now have for the first time in this province this very extensive directory of services.

Mr. Chairman, I know that when the opposition caucus and the leaders of the other parties in this Legislature and yourself have an opportunity to use these directories, as will the government agents and government offices around the province, it will provide an invaluable service to the people of British Columbia, a service that is very late in being established in this province. It's part of the consolidation of bringing order out of the chaos that we found when we became government.

So here in British Columbia we have a restructured Premier's office which provides a consolidation of services, executive council support to the committee system and the planning and policy of government, and intergovernmental affairs that co-ordinate the activities of not only the ministries of government but our relationship with other governments.

That's why we've been able to achieve an enviable record of relationships with the other governments of Canada that heretofore wasn't achieved, with a number of agreements, a number of negotiations, now co-ordinated and being carried on between this government and the government of Canada. We now have a record of the meetings and negotiations going on with the governor of Alaska, who is concerned about continental rail connection. Of course, had the intergovernmental services been here before, we would have known that such meetings had taken place in the past. But we now have a mechanism for consultation, for recording the events and for co-ordinating the policies and the activities of government.

I believe that this planning and the structure of this office, although attacked as it was by the Leader of the Opposition, is in keeping with the finest model or ideal that Professor Tennant was talking about in his article when he talked about the inefficient, directionless, no-leadership government, when he was doing not a political paper but his study of the last government for the Canadian

[ Page 978 ]

Public Policy Institute. Had the Leader of the Opposition been aware of this article and aware of how other governments viewed his administration and lack of leadership and policy, he would have thought twice about criticizing the extensive reorganization that has gone into this government.

I am very pleased today to have the opportunity. Perhaps we could take this first directory at the conclusion of today's business and make it available to the Speaker of our assembly for his knowledge and use. He could have the first set of such documents in the Legislature.

MR. CHAIRMAN: Thank you for recognizing the fact we cannot table documents in committee.

MR. BARRETT: Mr. Chairman, I would like to go back to the Premier's estimates. I wonder if all of that wonderful organizational help enabled us to pay someone nearly $47 a minute for 90 minutes on the job. That's fantastic that we have that kind of skill. All of that organization, all of that ability, and today it comes out we paid $47 a minute for 90 minutes for one person to be fired. Usually it takes five minutes to can somebody, but I guess it had to go through the committee and it cost $4,300 to go through the committee to can him.

Then we asked: "Who fired him?". We do not even know who fired him. We don't even know who fired him so that has to go back to the committee. I can imagine how many thousands of dollars.... We'll have to look through the phone book to find out who canned who around here. Donot leave now!

Mr. Chairman, last night the Premier of this province.... I will quote from the Blues of Hansard. Hansard is a system that records every word that is said in the House. It is a great device, a great technique, a great tool. Page 167-1-dm-10:42 last night. The Hon. Mr. Bennett, Mr. Chairman, with vigour - but they don't have those admonitions here - said: "The Leader of the Opposition asks about conflict of interest or difficulty in the forest industry. He did not mention the company that's been well recorded, and that's the statement made by the president of Plateau Mills.

"Mr. BARRETT: The president of Plateau Mills? Tell us what he said.

"HON. MR. BENNETT: And I will bring the exact quote into this Legislature because I used it last year without challenge, and the year before.

"MR. BARRETT: What did he say?

"HON. MR. BENNETT: I will bring it, because he mentions the timber sale, the controversial timber sale and the events surrounding it.

"MR. BARRETT: What did he say?

"HON. MR. BENNETT: I will bring it to this Legislature - yes, because it is well known in B.C."

I ask the Premier: did you bring this quote you were referring to to the Legislature today? I would appreciate hearing it from the Premier.

HON. MR. BENNETT: I'll read from a document that has already been read into the record. It has to do with timber sales in this province. This is a letter from R.A. Williams, Minister, to Mr. William Martens, President, Plateau Mills Ltd., Vanderhoof, B.C., April 18,1976:

"Dear Mr. Martens:

Further to my letter of January 20th last, I would like to confirm an annual supply of timber additional for Plateau Mills of 90,000 cunits to fulfill the needs of the expanded facilities at Engen.

By the way, Mr. Chairman, Engen is west of Vanderhoof, where Plateau Mills is located.

"As I indicated, the timber will originate from the area tributary to and the Kluskus Road.

"I've advised the Forest Service to prepare documents that would assure you of 12-year tenure, and I assure you that this will be the case. We expect some legislative changes in the Forest Act, which may be necessary prior to final documentation."

I want to say that there were other forest mills that would have bid had the normal procedure of public tender for forestry taken place in that area.

In conversation with Mr. Martens, who was aware of how timber sales were handled, the bidding and the advertising procedure, he suggested that when the former Forests minister asked them to remodel that mill, he would not until he had a letter signed by the minister, because in his view it was not the normal procedure for public bidding in this area.

We had both Bond Bros. - the member for Omineca (Mr. Kempf) , who is not here, knows well about that - and L & M sawmills of Vanderhoof cutting in the area and both needing timber. By this letter in advance, both then were precluded from having any opportunity to bid on that timber when it was posted and the bids taken. This was a commitment given ahead of any opportunity for the public to bid. It was a private commitment. It was so unusual that the president of the company, Mr. Martens, told me that he had asked

[ Page 979 ]

for a letter from that minister.

The conflict it shows has been recorded in debate in this Legislature a number of times: when you have the Forests minister, who is charged with the responsibility of administering the forests, allocating timber and being responsible for the way timber sales are bid, you cannot possibly have as his other primary interest the ownership of a particular mill, as that mill would receive favouritism over and above the competing mills in the area that need that timber.

There were three mills in the area that required timber, yet one of them had been taken over and bought by the government, and that mill received a commitment by letter so they would get on with remodelling in advance of the timber being put up for public bid. In fact it was so unusual that Mr. Martens asked for a signed letter because of the unusual nature of it. Even in the letter it suggests: "We expect some legislative changes in the Forest Act, which may be necessary prior to final documentation." I don't know what that refers to there. This letter was signed by Mr. R.A. Williams, the minister at that time. I don't believe those changes ever came in.

I do know that when we became government the area in question had not been.... We put it up for public bid under normal bidding procedure, recognizing there must be an opportunity for the firms in that area to bid. I mention that because it's obvious that government cannot set the rules and be a player in the game and be expected to administer fairly, beyond question not only be fair, but appear to be fair when they have the conflict-of-interest of wishing to protect their own and to develop their own. In this case, wishing to develop their own, they had already told Mr. Martens that they wanted the new construction of Plateau Mills to go ahead, and they guaranteed in letter in advance that 90,000 cunits would be there to fulfill the expanded facilities at Engen.

When you had other mills that needed the timber and, at least, needed the opportunity, they were denied that when such negotiations took place privately between the minister and the company that he's directed. That's why when we became government we took out of the hands of the Forests minister the responsibility for those forest firms the last government had acquired. Here is a Forests minister, who is required to administer the Forest Act, and to above all be impartial in the administration and allocation of timber in dealing with publicly or privately owned companies in an area which logically belongs in the private sector. It's obvious that those other two sawmills were not given an opportunity to have the normal right of a British Columbia company to bid.

Now, Mr. Chairman, the history of Plateau Mills, the way it was purchased and a number of other areas, were controversial in this province and will continue to be remembered by many people in this province as a controversial take-over or purchase, because there again when the government of the day wishes to extend its ownership into the private sector, because it controls the timber supply it can easily frighten off any other purchasers because they have to come to that same government to get that wood supply in the future. Who's going to get a wood supply if they try to outfight the big Minister of Forests, particularly the Minister of Forests who exercised so much power in the last government?

No, this is clearly a case of where - and clearly an example of why - the government must divest itself and particularly Must never have the Minister of Forests in that conflict-of-interest situation of having to administer the Act, and again, having taken the initiative to take over a company, administer the company and give it this type of assurance, in advance of any timber sale being posted, that it would get that timber. Clearly, it was part of the election issue in which the people of British Columbia spoke out clearly against the bigness of government, and government's invasion of the private sector, and the resulting conflict of interest that that placed on minister and government alike.

Governments, in their willingness to show a high success record, to show what good managers they are, will sometimes, with the best of intentions, give favours or special consideration with the idea in their own mind that they are doing something correct and something that is right. But when you have a Forests Act, when you have allocation of timber, everybody must have an opportunity to discuss it and to have an opportunity to bid. This shows clearly that in this case consideration was given in writing, signed by the former minister. The conflict of interest is clear for all of us to see that no minister should be put in that compromising position, and that is why we removed those companies from the control or authority of the Minister of Forests when we became government, and it's why today, Mr. Chairman, a number of these companies have been incorporated in the new British Columbia Resources Investment Corporation - to remove it from government control, to provide an investment opportunity for the people of British Columbia, and to allow the forest industry to operate in the impartial

[ Page 980 ]

and independent role that it should operate without any particular preference being given to any firm at any time.

MR. BARRETT: I asked the Premier, in reference to the Blues, not for 15 minutes of bafflegab, but for him to meet his commitment that he made to this House yesterday, when he said: "Mr. Chairman, the Leader of the Opposition (Mr. Barrett) asks about conflict of interest or difficulty in the forest industry. He didn't mention a company that's been well recorded, and that's the statement made by the president of Plateau Mills." What statement was made by the president of Plateau Mills? Did he at any time say, as you allude ... ? You show me where he said that there was interference by the minister at ny time. You quote from a document or statement that he's recorded of me. I'd appreciate that, please.

HON. MR. BENNETT: One more time, the president of Plateau Mills has told us...

MR. BARRETT: Who?

HON. MR. BENNETT: ... and he's mentioned to me. ., .

MR. BARRETT: You said you'd bring a statement into this House. Where's the document?

HON. MR. BENNETT: The president of Plateau Mills has mentioned that the deal was so unusual that he would not take the verbal assurance of the former Minister of Forests. He demanded a letter, and that letter is here.

MR. LEVI: Not in that document he didn't.

HON. MR. BENNETT: That letter is available to the people of this province, it's been mentioned in this Legislature and that's enough proof for the people of British Columbia because they know the type of deals that Bob Williams makes. They know what he makes to leave this Legislature, and let his leader come in for $80,000.

MR. BARRETT: Mr. Chairman, we have now had the opportunity for the Premier of this province to clarify the statement he made last night in this House by saying that Mr. Martens indicated that he was either threatened or cajoled or demanded conditions before the transfer of Plateau Mills took place.

MR. BARBER: He tried to run away from, his own statement.

MR. BARRETT: In an attempt to run away from his own statement that he would bring it into the Legislature, the Premier indicated to us today that perhaps he didn't have a statement, but he recalls a conversation with Mr. Martens where Mr. Martens is alluded to have said that to the Premier. Is that correct? That's what we get as an understanding.

MR. KING: That's his latest statement.

MR. BARRETT: I have in my hand, Mr. Chairman, a document of the Select Standing Committee on Public Accounts and Economic Affairs in Victoria. It is a transcript of hearings held by a House committee, dealing with exactly what the minister is attempting to tell us is his version of what Mr. Martens said.

In the presence of Mr. Ray Williston, along with Mr. Stupich, Mr. Veitch, Mr. Bawlf, Mr. Calder, Mr. Fraser, Mr. Hewitt, Mr. Kahl, Mr. Kerster, Mr. King, Mr. Loewen, Mr. McGeer, Mr. Skelly, Mr. Wallace and Mr. Phillips, Mr. Martens was asked specifically the questions the Premier alluded to, and at no time in this testimony given before a House committee is there any ever suggestion by Mr. Martens of a single thing the Premier has told this House.

For the Premier's edification I will quote from the testimony given by Mr. Martens after Mr. Martens was led to give these answers, hopefully, by a well-schooled series of questions by Social Credit backbenchers.

The Premier has a habit of dripping out suggestions without any evidence; the Premier has a habit of making statements with absolutely no backup; the Premier has a habit of making speeches quoting one member and attributing those remarks to another member. He made a half-hour speech attacking me on a speech given by Mr. Levi and then he discovered that mistake when he got into the hallway. Do you remember that? That was just within two weeks. You'd think he would learn a lesson and do a little research before he comes in here and blabs and runs.

After last night I was under the impression that Mr. Martens had told the Premier something in writing. There was a statement, the Premier said, and he alluded to it three times in his nervousness last night.

AN HON. MEMBER: Read the Blues.

MR. BARRETT: Read Hansard. He said: "I'll bring the exact quote into this Legislature because I used it last year without challenge, and the year before." What statement from Mr. Martens will you bring into the House? What quote?

[ Page 981 ]

AN HON. MEMBER: It doesn't exist.

MR. BARRETT: It doesn't exist, it never existed. This is what Mr. Martens told the committee, and I ask the Premier to read this document or correct the record. You never did correct the record that you were reading from Mr. Levi's speech and attributing those quotes to me * Was that not true? Oh, don't correct the record, and don't you ever make a speech without using my name. Just make it up as you go along or run away from it, that's our Premier.

Mr. Martens is asked here by Mr. Phillips.... I think you know Mr. Phillips.

MR. KING: He doesn't recall.

MR. BARRETT: He doesn't recall Mr. Phillips or Mr. Phillips doesn't recall him?

AN HON. MEMBER: He's easy to forget.

MR. BARRETT: "Mr. Phillips: The offer to purchase for $10 million...."

HON. MR. PHILLIPS: It's awfully easy for you to make charges.

MR. BARRETT: What?

MR. CHAIRMAN: Order, please, hon. members. Perhaps at this point a quotation from Sir Erskine May would be in order. On page 429 of the 19th edition he says: "Good temper and moderation are characteristics of parliamentary language." Perhaps we could stress the good temper part of that. Please continue.

MR. BARRETT: Mr. Chairman, a good temper in the Legislature and moderation in the restaurant.

HON. MR. PHILLIPS: Mudslinger! Hit and run!

MR. BARRETT: Oh. Mr. Chairman, I apologize for reading the written record, or for any attempt to put back the words that these politicians them elves say is mudslinging. I apologize for even having to read the garbage that these people say, but, nonetheless, I have to quote what they say and this is what Mr. Phillips said. If it's mudslinging, let it be so described by the author of those very words sitting across from me right now.

"HON. MR. PHILLIPS: The offer to purchase for $10 million - when was it made? Was there a down payment?

"MR. MARTENS: We never got that far; it was a little late to begin with.

"HON. MR. PHILLIPS: Did the shareholders ever approach the government and ask for time to consider the other offer?

"MR. MARTENS: No, the date of completion was actually already set.

"HON. MR. PHILLIPS: Did the people who were making the $10 million offer ever intercede with the government, to your knowledge, to ask that more time be given for you to consider their offer?

"MR. MARTENS: Well, as far as I know, they did. They did, yes.

"HON. MR. PHILLIPS: To your knowledge, was that request for more time turned down by the government?

"MR. MARTENS: I don't know. I didn't get involved in that part.

"'HON. MR. PHILLIPS: Were you ever assured by the government that if you sold to anyone other than the government they would receive fair treatment in the allocation of timber?

"MR. MARTENS: We didn't get into that kind of discussion."

MR. MACDONALD: Oh, that's directly contrary.

MR. BARRETT: Now, that's directly contrary to what the Premier told this House as to what Mr. Martens said to him. It's directly contrary to what the Premier told this House last night when he said he was going to bring in a statement by Mr. Martens.

MR. LEA: Twist, twist, twist.

MR. MACDONALD: Produce the statement or correct the record.

HON. MR. BENNETT: He's on the wrong part.

MR. BARRETT: In further questioning of Mr. Martens, Mr. Phillips said: "I believe that you stated at one point in your conservation that you did not have the opportunity to test the validity of the $10 million offer." Back again - another try'by the minister to get the kind of answer he wanted out of Mr. Martens.

He also said:

"I believe you; I wrote this down correctly. You stated that you did not have the time to test the $10 million offer to find out, as I believe you said, if it was legal. Have you asked for additional time? Now correct me if I'm wrong."

AN HON. MEMBER: There he goes! Learn from the Premier!

MR. BARRETT: "Have you asked for additio

[ Page 982 ]

nal time? Now, correct me if I'm wrong, but I believe I understood you to say that you really didn't have the opportunity or the time to test the $10 million offer. Did you ask for additional time?

"Mr. MARTENS: No, not really. I say it again. I repeat that we already have a completion date agreed on and we were assembled for completion when that offer was raised to that figure.

"MR. CHAIRMAN: Mr. Phillips, it would seem to me that this point has been well covered.

"HON. MR. PHILLIPS: Yes, I might cover it again.

"MR. MARTENS: I don't think I have anything further to say on it. I think it's covered."

Three times asked, three times covered, and Phillips was still looking for the other answer.

Now to the allusion made by the Premier in this House about conflict of interest in Mr. Martens' statement. There is no single statement by Mr. Martens on record that the Premier says he has and was going to bring into this House last night. The Premier has a capacity for 18-hour quotations. Say anything and do anything but get the heck out of the House when the heat is on, and 18 hours later hope like heck the opposition will forget it, or get up and made a 15-minute bafflegab speech and avoid addressing himself to his earlier statement.

Now I quote from Mr. Calder:

"MR. CALDER: No, but when the government finally did announce to you that they would buy out your company, what were the conditions involved?

"MR. MARTENS: Well, we were selling, and if that sale were not approved and then we were open to sell to the next buyer under the same terms and conditions and the same price.

That's what he said.

"MR. CALDER: What were those conditions?

"MR. MARTENS: Well, price, basically.

"MR. CALDER: What was Bob William offer that invited you to sell to him?

"MR. MARTENS: They replaced the purchaser that was not approved by the govern-ment.

"MR. BAWLF: Cash on the barrelhead?

"MR. MARTENS: Yes.

"MR. VEITCH: Mr. Martens, I know it's hard sometimes for one to remember things going back to 1973, but I'd like to refresh your memory slightly, and take you back not only to 1973 but perhaps back to 1972. Did you know a man by the name of B.R. Goodwin from Blackfoot, Idaho?

"MR. MARTENS: Yes.

"MR. VEITCH: Who was he, Mr. Martens?

"MR. MARTENS: He was a shareholder."

And it goes on to explain that Mr. Goodwin was a minor shareholder, and it was he who made that quote that made the headline story in The Vancouver Sun: "Terror Tactics Used." Not Martens. And perhaps that's what the Premier was attempting to allude to last night and couldn't produce today when asked to do so right here in the House.

Mr. Veitch goes on to quote the Williams letter that the Premier alludes to. I want to read from the record of what Mr. Martens said, not what the Premier says he said, not what he made up when he made the statement last night that he was going to bring in the statement, which you have not produced. Run away, hide, say anything, just to get out of here.

"MR. VEITCH: He doesn't have to take note. He's an honourable man.

"Now I'm quoting from Mr. Goodwin's letter. I'm assuming 'ourselves' to mean the shareholders."

He goes through the whole series of events that was elicited by Mr. Veitch that the Premier attempts to allude to in here, that somehow there was some mystery. And in conclusion, he goes on to say this, and I quote from Mr. Veitch:

"What about a minister that would threaten anybody that if they didn't sell to this government they would experience difficulties, and they hadn't been heretofore experienced in the operation of a mill in British Columbia."

Mr. Veitch goes on:

"I am suggesting to you, sir, that you had an offer you couldn't refuse, and perhaps you negotiated with a gun to your head. Is that not a fact that at that point in time you were aware of this?"

The whole case presented by the Premier put in a nutshell by Veitch. What does Mr. Martens say? I want to read it slowly, because it's on the record and it is directly contrary to the impression the Premier of this province tried to leave with this House, first by alleging there was a written statement, then by changing and saying it was a verbal statement. This is what Mr. Martens gave in testimony to a House committee. I read again, by Mr. Veitch:

"I am suggesting to you, sir, that you had an offer you couldn't refuse, and perhaps you negotiated with a gun to your head" - and remember the NDP was defeated by this time - "Is that not a fact that at that point in time you were aware of

[ Page 983 ]

this?"

Mr. Martens answered: "I wouldn't say that we were ever presented with any pressure."

That's his sworn statement, given in front of a House committee, under oath in front of a House committee.

"MR. VEITCH: Did he not discuss with you a variation of opinions?

"MR. MARTENS: I don't recall. We had a few meetings with Mr. William . I don't recall hearing that" - that is, a question of a threat around timber rights.

"MR. VEITCH: Do you remember the statement that you would anticipate difficulties which you had never experienced before. What would that have been?

"MR. MARTENS: I am not aware of that kind of statement."

Here is a denial by Mr. Martens himself that he was ever under any pressure by the minister, or that the minister ever made any threat to him, given in sworn testimony in front of a committee. Mr. Veitch wasn't happy with the answer and kept on asking the same questions. Finally the chairman said: "The witness did answer no." Now, of all the chairmen in this whole House, there is no one more gentle, understanding and patient than the member for Nanaimo.

If we may be allowed a note of levity, I thank the member for reminding us the calibre of the party that he joined. You now sit with Herb Bruch's memory. I suppose that's more difficult to swallow than the current company ions, the memory of Herb Bruch. My mother said: "Give it to them, Dave." And I'm doing exactly that. I'm doing it the way my mother would want me to do it. Stick to the facts, Dave. Read the record back so that he can't run. Isn't that right, Ma?

Mr. Chairman, the Premier of this province has no document from Mr. Martens. The Premier of this province attempts to interpret a letter from Mr. Williams as a threat to Mr.

Martens. When Mr. Martens was asked about that as a possible threat, he said that he was not under pressure. The Premier has no documents from Mr. Martens. The Premier is making up a story from whole cloth, he's been caught again. In a matter of hours, we find that what he said last night is totally incorrect. Just sit calm.

HON. MR. BENNETT: You're wrong.

MR. BARRETT: I'm wrong in reading that document. The whole committee is wrong, the whole world is wrong. The Premier knows it a different way than what's in the committee.

I want to know if anybody from Hansard has been fired for writing that stuff down, because it's wrong according to the Premier. I want to know if the member for Burnaby - not the undertaker, the other one, the overseer -were you quoted wrong in that, sir?

MR. VEITCH: You don't quote the whole thing.

MR. BARRETT: Well, he doesn't quote the whole thing. Mr. chairman, it is clear that the Premier got caught with his foot in his mouth again, making it up as he goes along -run and hide, spread any story you want, say anything you want that Martens said. The record indicates clearly that Mr. Martens said in the committee - he was led through three times by that member - that there was no pressure. So don't make things up, Mr. Premier. You're in enough trouble with facts, let alone fancy.

HON. MR. BENNETT: Mr. Chairman, that's just great, because obviously the Leader of the Opposition didn't listen to the letter I quoted, which was a letter written after Plateau Mills had been taken over. It had to do with a government-owned company that was already purchased. I wasn't referring to your concern about the takeover of Plateau. I talked about allocation of timber to firms without the bidding process.

This letter to Mr. Martens ums written in longhand by the former minister after the takeover - long after the takeover - and had to do with the modernization of Plateau Mills.

Mr. Martens said that he couldn't go ahead with the modernization unless he had assurances from the government that he would get the timber. He asked for it in writing. And so the minister of the day gave him a longhand letter which was quoted in this House, June 24,1976, and I'll read it again:

"Dear Mr. Martens:

Further to my letter of January 20 last, I would like to confirm an annual supply of timber (additional) for Plateau Mills of 90,000 cunits, to fulfill the needs of the expanded facilities at Engen.' Engen, by the way, is where Plateau Sawmills are located - near Vanderhoof.

"As I indicated, the timber will originate from the area tributary to and the Kluskus road. I have advised the Forest Service to prepare documents that would assure you of 12-year tenure and assure you that this will be the case. We expect some legislative changes in the Forest Act which may be necessary prior to

[ Page 984 ]

final documentation."

I want to say what I said before. This was after the government owned Plateau Mills. The member for North Vancouver-Capilano (Mr. Gibson) knows about this. He knows that in that area there are Bond Brothers Sawmill and L & M Lumber. You know that they also had mills and they required timber and that any timber sale would have to be put up and, of course, they would have an opportunity to bid. That's what Mr. Martens was concerned about. He wanted assurance that he would get the timber before the mill could proceed with the modernization. That's why he asked for it in writing.

I recollect this very well because I had quite a discussion with Mr. Martens when I had the opportunity of visiting the opening of Plateau Mills after we became government. We talked about the facility and its history, and he mentioned this. It was a letter that Mr. Martens said he had to get, and a copy of this letter in longhand was read into the House by the hon. Minister of Highways.

What I wanted to say is that there was a special assurance being given to a government owned mill for timber allocation. It has nothing to do with the take-over you're so sensitive about, nothing to do with the questions you read into the record, nothing to do with that situation. I know you're still embarrassed about the way you took over the forest companies, but what we're talking about, and what the Leader of the Opposition (Mr. Barrett) doesn't understand, is that the Minister of Forests at that time was responsible for the control of Plateau Mills, which was a government-owned company. He was responsible for administering the Forest Act. And in a letter to Mr. Martens he gives him assurance that, without a public timber sale, he will get the 90,000 cunits to build the mill, because the government wanted Plateau to succeed, they wanted the modernization to go ahead. So without a public tender in the area, a government-owned mill was given special consideration by a letter, signed by the former minister. There's the conflict of interest that no government can stand - being in companies, which logically belong in the private sector, and competing with companies in the private sector.

Here we have a Minister of Forests who introduces legislation, suggests he can change it at will - however he wants to designate timber - and who also has a responsibility to government for dealing with a government-owned sawmill that's in an area competing for timber with other mills, Bond Brothers and L & M Lumber of Vanderhoof. And here we have him making an assurance to the government-owned company, Plateau Mills, that he will give them this timber. And here we have the other mills in the area, obviously, not going to be given an opportunity to bid on this timber.

We came into government before this could be consummated. We made sure it went through the tender process. Mr. Martens made the letter available. That's why he made the letter available.

AN HON. MEMBER: Where's that statement you said you'd bring into the House?

HON. MR. BENNETT: The statement to me from Mr. Martens is that he considered it so unusual that he asked for it in writing, and he got it in writing - in longhand.

MR. LEA: In longhand! How sinister!

HON. MR. BENNETT: It did not come on government stationery. Maybe he just wanted that assurance that he would get the timber. Yes, it's sinister. I'll tell you that, if that minister had made a private deal of that nature with a private company, we all knew the results of what can happen with an arrangement such as that. In this case, he probably could not - and that is the problem with that party - see that the conflict of interest is there, even when the company is owned by the government.

It is not acting in the fair public interest, because the public is not just those enterprises operated by government, it is the private sector who also must operate under the rules and regulations and legislation of the forest industry. And if they didn't have the opportunity to compete with government-owned corporations, you'll know why there was a lack of confidence in the forest industry. So that's why I mentioned that there was an obvious conflict of interest - and it's been recorded in this House - in the allocation of timber.

I mentioned it last night, and it was clear that we were not talking about takeovers; we were talking about why the forest companies were being taken and put into the BCRIC to remove this conflict of interest, to remove them from government totally - not just the Forests minister - which we did immediately on assuming office.

The industry is being completely removed from government so that this sort of situation will not happen again. The Minister of Forests will not be put in the compromising situation of having to appear to favour his own with a special designation of wood, 90,000 cunits, to fill the needs of the expanded facilities at

[ Page 985 ]

Ergen. There we have it, Mr. Chairman. Obviously that's the reason we had to remove these forest companies from government ownership. There is the case, it's been well discussed.

It was discussed, and that's why Mr. Martens, a long time sawmiller, knew there was something unusual and why he asked for it in writing. That's why he brought it up and why the letter was made available. He found it so unusual he gave it to the new government. For the Leader of the Opposition to try and fuzz this up, not even understanding what we're talking about - so mixed up that he talks about a committee hearing discussion of the original takeover of Plateau when the principle we were discussing was conflict of interest for the Minister of Forests placed in that situation - indicates that he's so willing and so eager to try and defend the record of his former government that lie does not even listen to the debate that's going on.

Mr. Chairman, that is what the letter says -Mr. Martenso statement to me, and others of this government at various times, concerning his opinion of it, why he brought this letter forward and why he mentioned it. And you know from that, Mr. Chairman, that this government did then allow the normal procedure to take place and for that timber to go for bid in that area.

MR. BARRETT: Mr. Chairman, I just want to review very quickly where we're at and then make a few more comments, and then I think I'll let the matter rest.

Last night the Premier of this province said: "The Leader of the Opposition asks about conflict of interest or difficulty in the forest industry. He didn't mention the company that's been well recorded and that's the statement made by the president of the Plateau mills."

We have been at this question for one hour now. The Premier is yet to bring a statement made by Mr. Martens to this House. You refer to a conversation that is alleged to have taken place. That's a change from your statement last night.

But now, let's deal with what the Premier has brought up as a dodge. The Premier has brought up that somehow he alleges that Mr. Martens asked for a letter because the procedure used by Mr. William was so unusual that he needed a letter to confirm that procedure. Is that correct, Mr. Premier? Is that what you're saying? He used the word "sinister." Is that correct?

Interjections.

MR. LEA: That's today's story.

MR. BARRETT: Well, today's story, within the last 15 minutes, is that Mr. Martens is alleged to have said to the Premier that he asked for the letter because the procedure used was so unusual.

Well, so help me goodness, what has happened at the same committee hearing? That same point was covered in the committee hearing, and Mr. Martens' comments are diametrically opposed in the committee hearing to what the Premier says to this House.

AN HON. MEMBER: Caught out again, Bill.

MR. BARRETT: But that's not bad enough, my friends. What's worse is that the Premier neglected to discuss this matter with Mr. Williston before he came to the House today. I want to read this part of the transcript to you, my friends, to understand that a sworn testimony from Mr. Williston in front of the committee indicates that Mr. Williston was only carrying out the policy initiated by Mr. Williston himself as Minister of Lands and Forests. I read from these documents.

MR. LLOYD: That has nothing to do with it.

MR. BARRETT: Nothing to do with it?

First of all, a question by Mr. King to Mr. Martens. The Premier makes it up as he goes along, hoping that he can fudge his way out of a jam he got into last night.

Mr. King to Mr. Martens:

"I understand from your testimony that you said the Minister of Lands, Forests and Water Resources, Mr. Williams, indicated that there would be a timber supply for Plateau Mills contemplating the expansion. But you indicated also, as I understood it, that you would be required to bid through public tender on timber supply in the same manner as other mills in that area. Is that correct?

"MR. MARTENS: Well, in the first instance, this wasn't brought out how it would take place.

"MR. KING: But in fact, is that what happened?

"MR. MARTENS: That was what was going to happen. Of course, with the change of government, then it did happen, but it was going to happen anyway to have to bid on it."

Mr. Premier, we have had a catalogue of you being evasive on this issue, making it up as

[ Page 986 ]

you go along, only to be caught by sworn testimony given to a committee of this House. What does this testimony go on to say in contrast to what the Premier has told this House? Let's hear what the next question is.

"MR. KING: Okay, I'd like to ask a question of Mr. Williston at this point. Mr. Williston, you acted as Minister of Lands, Forests and Water Resources for many years in this province under the previous W.A.C. Bennett administration. I understand from the Pearse royal commission report that you on occasion indicated that there would be a firm timber supply for companies anticipating expansion also. Is that correct?"

Should I repeat that question?

AN HON. MEMBER: Yes, repeat the question.

MR. BARRETT: The question is to Mr. Williston. Is this sinister? This is the question to Mr. Williston:

"Okay" said Mr. King, "I'd like to ask a question of Mr. Williston at this point. Mr. Williston, you acted as Minister of Lands, Forests and Water Resources for many years in this province under the previous W.A.C. Bennett administration. I understand from the Pearse royal commission report that you on occasion indicated that there would be a firm timber supply for companies anticipating expansion also. Is that correct?

"MR. WILLISTON: The whole policy was based upon performance, and people had to give a firm commitment for performance and prove that there was a need for that timber. Then the timber would be put up for bid for them. The procedure was that if they made a firm commitment for construction of a project, which was approved, and if it had an indicated need for a timber supply for that date period, that timber supply, if it were available on inventory, was put in a hold position until it was put up for bid purposes. If the person did not meet the construction commitment date, the timber was then made available, or would be made available to someone who posted behind the initial applicant."

Next question by Mr. King:

"So the criteria then for guaranteeing firm timber supply were on the basis of performance. Provided that the requirement was satisfied, the bidding procedure became somewhat selective in terms of who could bid. Is that correct?

"MR. WILLISTON: It did, because all through the period of time you had to have an indication of performance insofar as this requirement is concerned. To clarify one or two issues which have gone before, the letter which I have read and to which Mr. Martens made reference was a mere statement on behalf of the minister that timber would be made available to meet the requirements of the mill."

Mr. Williston said:

"To clarify one or two issues that have gone before, the letter which I have just read - that is, the Williams letter - to which Mr. Martens made reference was a mere statement on behalf of the minister that timber would be made available to meet the requirements of the mill. There was no indication there of the performance in the mill, the size of the mill, the requirements of timber. It was just a simple statement that timber would be made available according to the requirements of the mill. It is just a simple statement that timber would be made available according to the requirements of the mill."

He repeated it.

It is exactly the same policy laid down by Williston - the policy explained to the committee by Williston - and it proves again that the Premier is attempting to make an argument where none exists against Mr. Williams or the NDP. If Mr. Williams is accused of being sinister, then he is sinister for following the policy established by Mr. Williston, who was a cabinet minister before him.

Mr. Premier, you have been caught making up stories today. Mr. Premier, you have been caught misinterpreting letters today. Mr. Premier, you have been caught making statements to this House which you cannot back up. Mr. Premier, you're still running, you I re still hiding and you can't ever admit that you made a teensy weensy little mistake. You have to blow it up to one mistake after another mistake.

I'm sorry my mother is gone. She told me a long time ago when I was a little child: "If you tell one fib, then you have to add a bigger fib to make it right. And then a bigger fib and then a bigger fib." That's what we have had last night and today, fib after fib after fib by that man. Fib after fib, fib after fib, fib after fib today - and there it is every day.

Mr. Chairman, I still have the floor. Thank you very much. Just sit down for moment. Don't be so guilty.

MR. CHAIRMAN: The Chairman has the floor.

[ Page 987 ]

HON. MR. BENNETT: I'm on a point of order. I would ask the Leader of the Opposition , to withdraw the repeated remark that the Premier told fib after fib after fib.

MR. BARRETT: Mr. Chairman, I withdraw the allegation that the Premier told fib after fib after fib. I ask students of history to read Hansard and find out for themselves.

HON. MR. BENNETT: Aw, come on. Unqualified!

MR. BARRETT: I unequivocally apologize on the Premier's behalf.

HON. MR. MAIR: That's not an unqualified withdrawal.

MR. BARRETT: Well, Mr. lawyer, how many more times do you want it?

HON. MR. MAIR: Just withdraw.

MR. CHAIRMAN: Hon. member, you know very well the traditions of the House.

Interjections.

MR. CHAIRMAN: Order, please.

[Mr. Chairman rises.]

Interjections.

[Mr. Chairman resumes his seat.]

MR. CHAIRMAN: I must ask the Leader of the Opposition and he knows what the request is and the position of the Chairman.

MR. BARRETT: I withdraw the word "fib, " Mr. Chairman.

Mr. Chairman, the statements made by the Premier are not backed up by the record, they're not backed up by the statements made by Mr. Williston as to policy. They are not backed up by the statements given in sworn testimony by Mr. Williston who was asked the very same point that the Premier was attempting to make on allegation. No one supports the Premier's contention or interpretation in sworn testimony about the specific questions. Mr. Martens does not do it in sworn testimony; Mr. Williston does not do it in sworn testimony. However, if the Premier is suggesting that Mr. Martens is wrong and Mr. Williston is wrong, we accept the Premier's word for that. But let the record show that the Premier of this province came in here last night and said he would bring in the quote. He never brought in any quote, and it's been whole cloth from that moment on from the Premier of this province.

HON. MR. BENNETT: Mr. Chairman, I'm not going to let the Leader of the Opposition get away with that nonsense.

SOME HON. MEMBERS: Oh, oh!

HON. MR. BENNETT: Let it be clear that there .is a difference where the Minister of Forests controls a company and also is called upon to allocate the timber. It is a clear conflict of interest.

AN HON. MEMBER: Nice try, Bill.

AN HON. MEMBER: How about when the company controls the minister?

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

HON. MR. BENNETT: I would ask the member for Vancouver Centre (Mr. Lauk) to be silent for the moment.

MR. KING: Just because Sommers went to jail, don't be so touchy.

HON. MR. BENNETT: It's a clear case of conflict of interest, understood by this side of the House. Perhaps in your commitment to socialism....

SOME HON. MEMBERS: Oh, oh!

HON MR. BENNETT: If the Leader of the Opposition can calm down from his hysterical outbursts I'll continue.

MR. KING: Our brand of socialism never sent a forest minister to jail. Talk about conflict of interest.

HON. MR. BENNETT: Perhaps your commitment to more and more government ownership blinds you to the obvious conflict of interest that exists when the minister, who is in a sensitive position, also has the responsibility of administering forest companies which are competing in the private sector and allocating timber.

I feel sorry for that party that they are so insensitive to the conflict-of-interest situation that this represents, which was well debated in the last election and about which the electorate made up their mind. What they find out today is that if you get back, you'll do the same thing: you'll take over more campa

[ Page 988 ]

nies and you sit there and you'll adjudicate in their favour, perhaps over and above the competing companies in the private sector. With your commitment to takeover and government companies and your insensitive attitude to your responsibilities, and conflict of interest, I would hope that you will publish a list before the next election of the companies you intend to take over; no such list was put before the people before the last election.

MR. BARRETT: One last quote, and then I'll sit down. I thought that the Premier would look for an out on the basis of conflict of interest, so I saved this last little quote for the very end just to put a cap on the whole debate. Mr. King asked the former Minister of Lands and Forests this question related to conflict of interest:

"So your former statement regarding the sequence of events between the former Minister of Lands, Forests and Water Resources, Mr. Williams, and, presumably, senior staff of the forest service is an assumption on your part rather than any specific documentation."

"MR. WILLISTON: Not so. I didn't use Mr. Williams' name; I used the office of the minister."

The minister is there whether he is William or whether he is the present-day minister. The minister still had to receive that direction, the very direction that Mr. Williams followed - exactly the same policy of Mr. Williston.

SOME HON. MEMBERS: A sweetheart deal.

MR. BARRETT: Are you calling Williston a liar?

MR. GIBSON: Mr. Chairman, I want to change the subject a little bit for the moment and get onto the subject of what the Premier had to say last year about coal, and get on to the subject of one of the bigger sellouts in British Columbia history.

I want to bring the Premier's mind back to Nelson, June 2,1977. There's a little piece of paper here called the British Columbia Coal Policy, which was unveiled by the Premier. In releasing the policy statement on June 2 in Nelson, the Premier made the following announcement: "The statement of coal policy for British Columbia is probably the most important resource policy announcement that this government has made since taking office, or will make during the next two or three years." Later on, he says: "I believe that the economy of this province will be significantly influenced by coal during the next decade, and that coal could eventually outrank the lumber industry in employment, resource revenue and taxation."

Later on, the Premier mentions some of the points. One of the changed points in this new coal policy is "a new system of granting licences to incorporate competitive tendering while not affecting existing or planned development." At the end of his statement, the Premier said: "The government also realizes that its policies must be consistent and predictable to create investor confidence."

Of course, it is true they must be consistent and predictable to create investor confidence. Here, less than a year later, we have a 180 degree swing-around in that policy that the Premier announced. I want to know why.

Mr. Chairman, I want to flash back a little bit to a meeting of the coal committee, February 7,1977. 1 think the minister was there.

MR. BENNETT: I wasn't there.

MR. GIBSON: It's all germane, Mr. Premier.

MR. BENNETT: I thought you said I was there.

MP. GIBSON: No, I was talking about the Minister of Mines (Hon. Mr. Chabot) , who was making a little intercession across the floor. The Coal Association and its members in B.C. said their spokesman would be happy to participate in the joint government-industry committee to address itself to proposing revisions to the Coal Act. Mr. Chabot and Dr. Eyles responded by appreciating the concerns about the minister's discretionary leases and noted "this can also create problem for the minister." And listen to this, Mr. Premier: "Several jurisdictions have tender systems for exploration and production." They invited comment. On February 7,1977, the Minister of Mines and his deputy invited comments from the industry about tendering for leases.

Carrying on with the notes from that meeting.

" During discussion, the industry spoke in favour of the present B.C. system. It was noted the mining industry is used to it. It's not comfortable with a tender system of the kind to which the petroleum industry is accustomed.

"Later on, Mr. Phillips inquired about specific problems with a bid system. The industry view was that it committed front end money which is otherwise needed to develop the property to a marketable position. Another problem is that of windows in leased areas that might be leased to

[ Page 989 ]

others, creating serious problems."

This was an exchange of views by the industry and the government coal committee, under the jurisdiction of the executive council on February 7,1977. In other words, the government, as of that date, had received the representations of the industry that a bid system wouldn't work. And then on June 2, the Premier announces a bid system is going ahead.

I want to bring the committee a little further forward in time to October 4,1977 - perhaps it's October 3. Anyway, it's in the Times of October 4. It quotes Mines Minister Chabot speaking in Edmonton: " 'We have developed a proposed system for disposal of coal rights which introduces a competitive bidding system for coal rights on selected Grown-owned lands, ' said Chabot." The policy foreshadowed by the Premier on June 2 had been firmed up by the minister on October 4, to the point where the policy was firm and the procedure had been developed.

Let us come forward again to another meeting of the coal committee on February 6,1978, with industry representatives. Some time be tween that meeting and February 10....

MR. BARBER: Gordon, why don't you adjourn? They're making up the new information.

MR. GIBSON: Well, I see them huddling over there, and I don't blame them for being concerned because this is one of the great potential scandals of the British Columbia natural resources history.

On February 10, the Minister of Mines issued a release which flip-flopped the policy that the minister had announced by 180 degrees. It threw the bidding system that the Premier had announced out of the window, and brought in what the minister called a "priority basis, " which means "first come, first served, no fee" for translation, except for that $1 per acre - isn't it, Mr. Minister? - or $640 per square mile of coal.

That was the minister's announcement, and what has happened since that time? I asked the Premier if he approved of the minister's announcement at the time. I asked him that in question period today, and while I don't have the Blues of today before me, my recollection was words to the effect: "Yes, the government had considered this before the announcement went out." That policy, therefore, was adopted as his own on a flipflop on the June 2 statement of the year before.

MR. BARBER: Who got to him in between?

MR. GIBSON: I don't know what happened in between, Mr. Member. That is a very interesting question, but for the moment I am stating on-the-record facts.

What has happened since the minister's announcement on February 10 to this resource that the Premier said could be the most important resource announcement during their term of office here has been that there has been applied for an additional - more or less - 705 square miles of coal exploration licences. There are currently outstanding something like 940 square miles. These are rough numbers. So what we have here, in a space of three months, is applications for licences which, if granted by the minister, will result in the licensing of an additional 75 per cent, within three months, of all of the coal lands to date licensed in the province of British Columbia.

I want to know what the hurry was. I want to know what's going on that these lands have to be alienated so quickly.

Now in the House yesterday the minister said: "Oh, it's just exploration." The minister knows the Coal Act as well as I do. He knows that the Coal Act, section 26, says that once the conditions are complied with, the Lieutenant-Governor-in-Council shall issue the production leases.

HON. MR. CHABOT: At the recommendation of the minister.

MR. GIBSON: Oh, Mr. Minister, have you been leading on the coal companies, then? Have you been telling them that if they do the proper exploration work and live up to all your criteria ... ? Are you telling them that you are not going to give them leases? Surely that is not going to be your policy. Surely that's not going to be the Premier's policy. The Premier couldn't confirm that kind of policy because it would be the most manifestly unfair thing to send people out digging around in the countryside in the province of British Columbia and then say: "You don't have a right, if you comply with the conditions, to take advantage of that finding."

MR. LAUK: Ministerial discretion - he used to attack it.

MR. GIBSON: You're right. But leave that minister aside; I'm talking to the Premier.

The results of this have been that of that additional 705 square miles...

HON. MR. CHABOT: He doesn't want any more coal development.

MR. GIBSON: ... all but 112 square miles have

[ Page 990 ]

ended up in the hands of the same giant energy companies that hold the previous 940 square miles.

I asked the Premier in question period today what is going to be done to recapture the value of these lands for the citizens of the province of British Columbia who own these resources. I was going to ask him. I guess I only got as far as: had the Premier had been advised of these dangers? Ah, that's right, and the minister laughed at that, and the Premier laughed at that and he said: "What's the danger of exploration?" There is no danger in exploration, Mr. Premier. The danger is in the rights it creates and the giving away of those rights in a wholesale and unco-ordinated fashion.

AN HON. MEMBER: Don't issue any more licences.

MR. GIBSON: I want to know from you....

MR. CHAIRMAN: Please address the Chair, hon. member.

MR. GIBSON: I want to know from the Premier, because he tells us that this had his personal approval, if he received an estimated economic value of these lands, or was it just another Wenner-Gren trench? Since it was the government's decision approved by the Premier to turn around the bidding system that he announced in the first place, has the Premier any idea how the public will retain the economic value that they had in those lands? Those lands are worth something. There are values added on to them by the companies that do the exploration - there is no question about that. Those who make investments are entitled to return on that investment, and those who take risks are entitled to return on their risks. But there is value that adheres to the owners of the land who are the taxpayers too. What is the Premier's plan to recapture that value? And in particular, I say: why is it all being given away at once?

Mr. Chairman, this is a very complex question. I don't pretend to have the answer as to whether it should be bidding or a priority system, as to whether it should be some kind of a holdback checkerboard pattern like the Albertans do with their oil and gas leases, holding back some land and licensing out others so that when discoveries are made in the land here, the Crown still owns some next door that has some value it can sell.

Interjection.

MR. GIBSON: Checkerboard - that's right, Mr. Premier. You're familiar with the concept. I don't know if the resource rents should be recaptured some time later by some type of a stumpage-type royalty system. There are all kinds of possibilities that there could be. And I don't pretend at this point to have the answer. But I do have the question and I do have this knowledge: a decision has been made on the alienation of most of the remaining valuable coal lands in the province of British Columbia, which are on stream through the gazetting process to the minister's office right now, which will alienate those lands. I believe that decision was made over public service advice and against it, and I know that decision was made away from public scrutiny of a valuable public asset. The government has no right whatsoever to do that.

Mr. Chairman, the Premier earlier on in this debate today was talking about the forest industry. He was talking about the proprieties in the forest industry and how things must be done in the correct way. There must not be improper pressures brought to bear. How can the citizens of this province know whether or not improper pressures were brought to bear in the formulation of this coal policy when it was all done completely in private with no chance of a public dialogue, with a complete sudden turnabout in the government's announced coal policy, without one opportunity for taxpayers to come forward and say, "Now, I'd like to think a little bit more about this, " without an independent commissioner, an independent report that could be tabled in this House saying, "we've looked at this way of disposing the rights and that way of disposing the rights, and here is how they do it here and that is how they do it in Australia, and so on"? No, sir, none of this do we have, Mr. Chairman. Instead we have a last-minute, flip-flopping government policy on almost as much coal land as has been up till now leased out in the history of this province in less than three months since the minister made his announcement.

Mr. Chairman, I am as anxious as anyone in this province to see the development of our coal resources, but I say the public owns these resources until they are alienated into private hands. These 705 square miles that are going through the application system now have not as yet been alienated. I say that the process under which they are about to be alienated has not been subject to public review and, in fact, is the subject of a last minute flip-flop.

I say further that the veiled references that both the Premier and the minister have

[ Page 991 ]

made to future changes in work requirements or taxation legislation are simply insufficient at this stage. We simply cannot accept those kinds of vague statements without precise detail. after all, Mr. Premier, we had not vague statements, you had very specific state ments last June 2 as to exactly how these resources were going to be disposed of - and those turned out to be incorrect. And then we had the Minister of Mines (Hon. Mr. Chabot) saying in Edmonton on October 4 that a procedure had been developed to implement this policy. And on February 10 it was stood on its head.

Mr. Chairman, I say that this is not good enough. Let's say that we learned all of a sudden that applications were underway to give away a third of this province's timber resources within a period of three months. We would properly rear back and say: "Whoa, what's going on here? Has this been discussed? Has the methodology been discussed?" And even if it were a well-known methodology, as it is in the Forest Service, we would still say: "Well, let's look at this rather carefully."

But here we have almost as much coal land as had been alienated, as I say, over the history of this province up to now, that is in that stream of gazetting, some of it probably sitting on the minister's desk right now, and is about to enter the position where the rights will be there. I've read the Act, Mr. Minister and Mr. Premier. It is at the exploration licensing stage. When you've gone through that and when you've done the required work and when you've presented your required plans, the Lieutenant Governor-in-Council "shall" grant leases, says the Act, section 26.

Mr. Chairman, this is an incredibly large-scale proposed alienation of a public re source.

MR. LAUK: He doesn't even know what he's done, I don't think.

MR. GIBSON: This method of alienation may be right and it may be wrong, but I say the public has a right to know precisely what are going to be the terms and conditions, and it has a right to insist that the process be held up and frozen right now, today, until such times as the terms and conditions are fully on the record, as they are not now.

I say to you, Mr. Chairman, that there's something very strange when there's a flipflop on a policy with no explanation. Four days after a meeting, a policy is announced by the Premier and confirmed by the minister.

MR. LAUK: What are you suggesting is strange? Are you saying the minister is guilty of wrongdoing?

MR. GIBSON: I'm saying, Mr. Chairman, that the whole affair smells. I'm saying it must be opened to the light of day. I'm saying that in the meantime all of these licences working their way through the system must be frozen where they are. The minister must take no further moves. The public owns these resources.

HON. MR. CHABOT: Do you want a 10-year moratorium on Hydro projects too?

MR. GIBSON: Mr. Chairman, to show the level of appreciation that the minister has of these questions, he says across the floor of this House: "Do you want a 10-year moratorium on Hydro projects too?"

I read a wonderful quote today in a paper which members may receive. It's called "The Seniors' World" and it has a wise saying here. It says: "The speed of an army is that of its slowest man." The stupidity of a committee is that of its weirdest member.

A 10-year moratorium on Hydro projects indeed! The question on Hydro projects is the same as on any other resource project. Have they gone through on a proper approval process? I say that the alienation through licensing of the remaining desirable coal land in this province, or a very large fraction of it, has not gone through a proper approval process.

Mr. Chairman, the public owns these resources. The alienation must be frozen right now and it must be made open to public debate and public review as to every aspect before it proceeds one day further.

Interjection.

HON. MR. CHABOT: I'll punch you in the nose. Want to step outside?

MR. STEPHENS: Mr. Chairman, I would like to talk a few minutes about the debate to date commencing last night between the Premier and the Leader of the Opposition. I was surprised that I've only had to sit here for three and a half weeks before the speeches are recycled. I was pleased to listen to the Premier repeat his budget debate speech and I was pleased to hear the Leader of the Opposition repeat his.

I was a little disappointed, however, to find that the 1975 election campaign is still being fought in this House. It's my suggestion, Mr. Chairman, that the people of British Columbia are just a little bit weary and tired

[ Page 992 ]

of this government and of this opposition. The Premier made the statement last night that the previous NDP government hid the losses and covered up the losses of the government. Now that may be so, but I think that the Premier should answer some questions in this regard himself. The first question that I would like to ask the Premier is: when is he going to stop fooling the people of this province by suggesting to them and repeating to them that he has a balanced budget?

The previous government - in fact the two previous governments and the present government - have been borrowing large sing of money from. the pension plans administered by this government. It is $650 million to date, approximately, and they have been funnelling that money into the B.C. Railway knowing full well that the chances of that money ever being repaid by the railway are certainly extremely remote, if not impossible. Sure, this government can say that it has a balanced budget so long as it keeps out of the budget losses and obvious losses to that extent. I'd like to ask the Premier: when do you intend to face up to the fact that that money is going to have to be repaid by the taxpayers of this province, and when are you going to put it into the budget where it belongs?

You, sir, are doing precisely what you accused the former government of doing. You're hiding these losses and the people of this province are going to have to pay for it. Perhaps, Mr. Chairman, what the Premier is doing.... Maybe he recognizes that he's not going to be here very long, and he's simply hoping he can keep that loss out of the budget and pass it on to the next government. I'm really surprised that the Premier has already, in this debate, recognized that the NDP is coming back to power. Look at the Blues, at the statements the Premier made last night. I'm reading from the page marked at the top right-hand side 159/2/dm. At the bottom the Premier says this referring to the second member for Victoria (Mr. Barber):

"He told them he didn't want the tourists in British Columbia. I wish the second member for Victoria would remember that when he says one thing and his colleagues, whom you support, have said another thing, and are on the record as saying they don't want tourists.... Tell that to the people of B.C. when you next campaign. You may like tourists because you're in Victoria, but your colleagues, the ones who are in the cabinet and will probably be there again, don't want them."

What an astonishing statement from a man who stands in this House daily and whose colleagues stand in this House daily, and exhibit only one common bond - their dislike for the NDP and socialists. My goodness, Mr. Chairman, the Premier is recognizing already, after less than three years, that the opposition which he detests is on its way back. Maybe that's why he's not too anxious to disclose to the people of British Columbia that a little farther down the road they're going to have to pick up a tab for over $650 million.

I'd like to talk for a minute on this repeated statement by the Premier of this province as to his ability to financially manage our affairs. He constantly talks about holding the line on expenses. It took more than 100 years for this province to come up with a budget in excess of $3 billion. It has taken this government only three years to increase that to $4 billion, a 25 per cent increase in the expenditure of this government since coming to power. If that is good management, if that is restraint of the taxpayers' dollars, then I'd certainly hate to be around when they do start spending money. The only reason this government can claim a balanced budget is not because it has restrained spending or restrained the expansion of government, but simply because it has increased taxes. Anybody can balance a budget if they simply use a heavy tax hand and remove the dollars from the pockets of the people of this province. I believe in a balanced budget, but what good does it do for a government to balance its budget when the working people of this province can't balance theirs because the government is taking so much of their income?

Now let's talk about conflict of interest. This is a subject to which the Premier frequently refers and on which much debate has been held this afternoon and last night. The Premier, last night, made the statement that a government can't ride three horses at the same time, that that is a conflict of interest. Well, that's very exciting news. I always thought a conflict of interest was when you rode two horses. Is the Premier saying that it's all right for a government to have a conflict between two people but not three? It seems that way, and I'm not surprised that that's what he means, because I'd like to refer the Premier to his Minister of Education (Hon. Mr. McGeer) .

The Minister of Education is the master of riding three horses at the same time. Talk about a conflict of interest! He's going around this province making statements that claimants against ICBC evidently should not have the right to be represented by lawyers. The Minister of Education recently stated:

[ Page 993 ]

"It's an excellent thing for the lawyers, but it's not a particularly good thing for the public, because so much time, energy and money are wasted while these decisions are thrashed out in lengthy court trials."

Well, that's a remarkable statement. That your minister could possibly suggest that the legal system of this country is a waste of money...

Interjection.

MR. STEPHENS: Talk about a conflict of interest, a direct conflict of interest that a minister of the Crown, Mr. Chairman....

MR. CHAIRMAN: Order, please, hon. member. Those areas that you are canvassing at this time pertain to the Minister of Education and his responsibility for the Insurance Corporation of British Columbia, and remarks made by ministers are best discussed under their particular estimates. The debate under the Premier's office is virtually wide open, but when you get down to specifics, I would have to ask you to come to order.

MR. STEPHENS: I understand what you are saying, Mr. Chairman, but I frankly an not prepared to accept that. You allowed the Premier of this province to stand up and talk about statements made, you allowed the Leader of the Opposition (Mr. Barrett) to talk about conflict of interest in other departments, you allowed the leader of the Liberal party (Mr. Gibson) to talk about the conflict in the Minister of Mines (Hon. Mr. Chabot) . I want the same right. If you're going to impose a rule on this House, you impose it on everybody. You're not going to impose it on the leader of the Conservative party alone.

It was the Premier, Mr. Chairman, that raised the question of conflict of interest, not I, and I want the right to respond to it.

MR. CHAIRMAN: Within the realm of the debate, that's acceptable. However, you're breaking off into discussing an area which might better be discussed under the Minister of Education's estimates.

MR. STEPHENS: Well, that's all right, Mr. Chairman - if you're going to invoke that rule, invoke it on everybody. I'm suggesting to you, Mr. Chairman, that just because one of the backbenchers of the government party....

MR. CHAIRMAN: Hon. member, I must inform you that if you wish to challenge the Chair, you must do so in the form of a challenge of the

Chair.

MR. LAUK: On a point of order. On the same point that the hon. Chair has raised, Mr. Chairman, you're taking advantage of your very pleasant personality, because I certainly have seen the broad range of debate, both last night and today. I haven't seen where the leader of the Conservative party has strayed in any way from that broad range of debate, if it's possible to do so. I'd also like to inform the Chair....

Interjection.

MR. LAUK: Oh, Rafe is back. There he is. He never stops, old motor-mouth.

MR. CHAIRMAN: You're now ceasing to become a point of order. Please continue on your point of order.

MR. LAUK: I was just trying to defend myself against that big bully of a minister, Mr. Chairman.

HON. MR. MAIR: Step outside!

MR. LAUK: You find, with respect, that Sir Erskine May in both the 17th and 18th editions refers to the presiding member of council - or the first minister or prime minister - as being responsible for the statements, as embarrassing as they may be, of each of the members of the executive council. He's responsible, therefore, to defend government and policy statements made by his ministers during Committee of Supply.

MR. CHAIRMAN: Well, hon. member, if you would like to cite those references, we have both the 17th and the 18th editions of May and....

MR. LAUK: I'll find the pages for you and the Clerk.

MR. CHAIRMAN: I will ask that you cite Sir Erskine May. Editions are available to all members.

MR. LAUK: Could I call upon the Chair to provide me with the two copies of Sir Erskine May? Isn't that a reasonable request? And could we recess while I canvass the ... ?

MR. CHAIRMAN: The editions of Sir Erskine May are available to you at the library.

MR. LAUK: The library?

[ Page 994 ]

MR. CHAIRMAN: Or just down the hall. Perhaps if you would care to....

Thank you very much, hon. member. Please take your seat. The member for Oak Bay on the Premier's estimates. The debate is virtually wide-ranging, but those specific items dealing with the minister ought better to be discussed under his estimates. I'm not.... How do I want to word this? Please continue and I'll let you know if you get too far out of line.

MR. STEPHENS: Mr. Chairman, I want to just make one more brief reference to this question of conflict of interest, because, as it was raised by the Premier, I think that this is a matter that should be brought to the Premier's attention when he's considering the conflict of interest of any of his ministers.

Your Minister of Education (Hon. Mr. McGeer) said: "But in B.C. . where there is only one insurance corporation for public liability, accident victims are actually suing their own company. In other words, ICBC is both prosecutor and defendant in every single bodily injury case."

That quite clearly can be a conflict, Mr. Chairman. Now the Minister of Education wants to make ICBC the lawyer as well - plaintiff, defendant, lawyer and judge. The Minister of Education has suggested that the citizens of this province should not have access to an independent lawyer to act on their behalf in claims against this public body. You could not have a more dangerous precedent than that. I ask the Premier to consider that and to bring that to the attention of his minister and see if you can't straighten him out on that subject if you are concerned about conflict of interest. There's not a more serious conflict facing us right now. You have lawyers behind you there. One in particular - the Winslow boy - would probably be very much ashamed of the Minister of Education with a statement like that.

Mr. Chairman, I just have a few more brief remarks and I will be back on to the estimates later. I just want to start these out initially. The Leader of the Opposition yesterday asked the Premier to state whether in fact the purchase of B.C. Tel shares was a bad investment. The Premier did not answer that question so I will answer it for him.

I say to the Leader of the Opposition that if I want to own B. C. Tel shares, I will buy them. I do not want you or the Minister of Finance or the Premier of this province to act as my stockbroker. I would have been very happy if the Premier had taken that position but he remained absolutely silent on it. I want to make the decision where I invest. I don't want the Premier or the former Premier of this province taking my tax dollar to speculate on the market. I don't think that's his position to do so and I don't think it's any government representative's position to do so.

Now let's talk about free trade. The Premier has stated that he supports free trade. He hasn't indicated to what extent or in what areas or how much. The Leader of the Opposition has said that free trade is "absolutely stupid." What a ridiculous statement that is, Mr. Chairman. I say to the Premier: would you please stand up, Mr. Premier, on behalf of the people of British Columbia when you are asked these questions by the socialist opposition? Would you please take a stand on them? It's quite clear. It might make no difference to the Leader of the Opposition that the people whom he is worried about, the workers whom he claims to be worried about, the people of British Columbia, have paid twice as much for shoes as they should in order to protect the shoe manufacturers in Ontario. It doesn't seem to matter to him that we spend much more for clothing to protect the manufacturers in the province of Quebec. It doesn't seem to matter to him that the workers of this province spend $1,000 more for automobiles to protect eastern interests.

Now of course we've got to be Canadians. We're all Canadians and we all support Canada. But I'm a little tired, as a British Columbian, of sitting around and waiting and waiting and waiting for the people in Ottawa to change the tariff barriers to give this province some benefit. Mr. Chairman, I ask the Premier to take a little stronger stand on that as well.

AN HON. MEMBER: Read this.

MR. STEPHENS: Yes, love read that, but it really does not do us much good for you to put these things into papers and go and deliver them down into the eastern market. That's a problem we've had forever. I think we need a tougher stand. We've got a very tough man in the province of Quebec, a man who no longer wants to be a Canadian. We've got some very strong representation, and we've got a long way to go.

Mr. Chairman, I would ask the Premier, on this question of free trade, that when the Leader of the Opposition (Mr. Barrett) stands up and says it's stupid, don't just sit there and shake your head and mumble the word "nonsense." Get up and fight. British Columbians need it.

HON. MR. MAIR: Do you expect to convince him

[ Page 995 ]

of anything like that?

MR. STEPHENS: Surely, Mr. Chairman, we're not speaking to convince the Premier. It seems to me the object of this House is to deliver a message to the people of British Columbia. That's one of the main problems in this House. The two major parties seem to think that the object of being here is to convince the other side of the floor that they're right and somebody else is wrong. We're here for another reason.

MR. GIBSON: What is that?

MR. STEPHENS: The Leader of the Liberal Party (Mr. Gibson) says: "What is that other reason? I'd like to know." That's a very good question. Perhaps you and I should sit down and have a chat about this a little later.

AN HON. MEMBER: Another coalition!

HON. MR. BENNETT: I want to know who the 56th member is.

MR. STEPHENS: Don't run away too quickly.

Mr. Chairman, I'll have further to say later on. That covers my present contribution.

MR. BARBER: I'm happy to rise in the estimates of the runaway Premier, the leader of the rundown government, the government which the Premier boasts has cut expenditures and this year will see the B.C. Systems Corporation almost 50 per cent over budget. If ever there was a government whose fiscal spending is out of control, it's this government, with one of the worst records in overruns this province has ever seen. This government has one of the most badly mismanaged Crown corporations, the B.G. Systems Corp., that any province has ever seen.

The Minister of Finance (Hon. Mr. Wolfe) was enormously embarrassed when my colleague for Vancouver-Burrard (Mr. Levi) raised this point a few days ago. They will be embarrassed time and time again. Government spending under Social Credit is out of control in this province. I personally share the sentiments of the member for Oak Bay (Mr. Stephens) when he talks about the hypocrisy of a government purporting to control expenditures and then doing more damage by overcharging and overtaxing in order to achieve the hopes of a balanced budget than any other government has ever done.

This is a runaway Premier, it's a rundown government, and we don't support him or it. He talked last night about coverups. He talks about coverups and he neglects to tell us about the enormous coverup on the B.C. Rail when his own father was Premier. The real losses in B.C. Rail were concealed deliberately, consistently and malevolently from the people of British Columbia, a coverup that led to the expulsion from a professional association of certain persons involved as accountants.

I want to talk about another kind of coverup, Mr. Chairman. I want to talk about the coverup involved in the establishment of the British Columbia Resources Investment Corporation. Let me try and relate this in terms that any ordinary citizen could understand.

If you, Mr. Chairman, owned a television set and you went away for the summer or you weren't looking and the television set went missing, what would you think if someone came to your front door a few months later and asked you to buy the television set back?

MS. BROWN: I'd report them to the police.

MR. BARBER: Would you call it a swindle, Mr. Chairman? It was your television set. In a moment of neglect, maybe you were looking the wrong way, the television set disappeared for a few seconds, and then someone came around to the front door, delivered the same television set, and asked you to buy it back. Would you call that a swindle, Mr. Chairman?

Well, it's the judgment of this opposition that the British Columbia Resources Investment Corporation is a political swindle perpetrated against the people of British Columbia. As my colleague, the Leader of the Opposition (Mr. Barrett) , has many times said, only a government of car dealers would ever attempt to sell you something you already owned. As this debate progresses, I will be returning to the metaphor of the television set you already owned and someone proposes to sell back to you.

I want to talk for the moment, however, about the irresponsibility and the incompetence of this Premier in his replies to my own questions and to those of my colleagues regarding the B.C. Resources -Investment Corporation. The Premier is charged under section 1, the interpretation section of that statute, with the administration of the British Columbia Resources Investment Corporation Act. The Premier himself introduced the Act. The Premier's name is on it, and he is named by order-in-council as the administrator of it. Both the Minister of Finance (Hon. Mr. Wolfe) and others have indicated to this House that the Premier is responsible for the British Columbia Resources Investment Corporation. It was his Act, it's his boasting that reminds

[ Page 996 ]

the people about it. It was his name on the order-in-council. It is his responsibility. However, when it comes to answering questions, the Premier chooses to be not quite so responsible. He is most certainly not quite so forthcoming.

It is the opinion of this opposition that the Premier is responsible for answering questions about the salaries paid to Mr. Helliwell, the president and chief executive officer of that corporation. It is the judgment of this opposition that the Premier must answer questions about the fees and other benefits paid to the five members of the board of directors appointed by the Premier as the interim board of the British Columbia Resources Investment Corporation. It is the judgment of this opposition that the Premier personally is accountable to this House for every action of that corporation.

Let me remind you, the Premier brought this bill into the House, the Premier guided it through debate, the Premier gave the final remarks on it, the Premier approved it. In order-in-council, he himself was appointed to administer the Act. Any attempt by this Premier to evade responsibility for what he created is incompetent and irresponsible. I demand again now, as I have demanded before, answers to my questions about the salaries, bonuses and benefits, if any, paid to Mr. Helliwell, chief executive officer of that corporation. I demand again answers to the questions about the fees paid to the directors of the British Columbia Resources Investment Corporation. I demand again that the Premier be prepared to accept the responsibility for the corporation he himself created, and accept it now in his own estimates.

Now, Mr. Chairman, the Premier has in reply stated that the reason he will not answer in this House - and I hope he listens, I don't wish to misquote him; I certainly won't do so on purpose - is that, firstly, the corporation is not a Crown corporation, and the Act specifically says it is not. That's the Premier's first defence. He's correct. Secondly, he says that it has an independent board of directors and the, only people who have the right to ask questions of them are the shareholders of that corporation's shares. Those are the Premier's two principal defences. Let's examine then one by one.

[Mr. Mussallem in the chair.]

First of all, the Premier alleges that only the shareholders can ask questions. Well, let me read to you, Mr. Chairman, from Hansard, May 13,1974, at page 3051, another of these readings from the past for which the opposition is becoming justly famous. What do they say in that instance, dealing with Can-Cel, Mr. Chairman, when it cam to being accountable for an enterprise that was (a) not a Crown corporation and (b) owned by its shareholders? Let me remind the committee, Mr. Chairman, that Can-Cel at the moment is owned 82 per cent by the British Columbia Resources Investment Corporation, just a little while ago by the government, which is to say, all of the people. Can-Cel was originally purchased -not taken over, not nationalized or grabbed like B.C. Hydro and B.C. Ferries. It was purchased by the previous administration. The previous administration, at the time of purchase, owned 79 per cent of Can-Cel. CanCel was not, and is not, a Crown corporation. So in both regards, Mr. Chairman, the case of Can-Cel is entirely parallel to that of the resources corporation which is also not a Crown corporation. And in fact today, it should be pointed out, Mr. Chairman, that the government itself is the exclusive shareholder in the resources corporation; they own 100 per cent of the shares. However, as a matter of record, the Premier has indicated that he hopes that the government will own no more than 49 per cent of the shares of the resources corporation.

So when it suited their political purpose in opposition, they found it proper and reasonable to demand answers from the minister of the day regarding Can-Cel, which was (a) not a Crown corporation and (b) not entirely owned by the government. They demanded answers again and again and again. They demanded answers to their questions about that corporation as we do today demand answers to our questions about the resources corporation. The parallel is exact and precise. If they felt it legitimate in opposition to ask questions of Can-Cel -not a Grown corporation, not wholly owned by the government - we find it legitimate as well to ask questions of the resources corporation, not a Crown corporation - not owned entirely by the government. But what did they say on May 13,1974, Mr. Chairman?

I'm happy that the minister of economic development and failures and bankruptcies is in the House today, because it was he who made the case that we are happy to restate now about accountability. Page 3051:

"MR. PHILLIPS: Mr. Chairman, what I would like more than anything else in the world" - always the exaggeration - "is to have the minister" - that's the Minister of Forests at that time, Mr. Williams -answer some questions in this Legislature, to table some papers. After all, in

[ Page 997 ]

one sense of the word, being a taxpayer in British Columbia, not only sharing directly but, I guess, indirectly, I am a shareholder in Can-Cel."

Now this a most interesting proposition he put forward on May 13,1974. He demanded the right to have questions answered because he was a shareholder in Can-Cel. But let me continue:

The former member for Kamloops interjects at that point to read the annual report. To continue, Mr. Phillips said:

"There are millions of people in British Columbia who are also shareholders in an indirect way in Can-Cel. They would like some answers. They might be shareholders in a much larger way if the minister continues in his present trend of the last 18 months since he took over his portfolio. I think these would-be shareholders in the forest industry would also like some answers as to where they are going. Maybe we should call this a shareholders' meeting."

He said then, when it suited his political purpose: "Maybe we could call this a shareholders' meeting." Well, if it was good enough for him, it's good enough for us. Mr. Chairman, I declare this a shareholders' meeting of the B.C. Resources Investment Corporation. Okay?

The next quote is even more damaging: "Maybe we could say that I represent here in this Legislature 79 per cent of the shareholders in Can-Cel." We, here in this Legislature, represent 100 per cent of the owners in the Resources Investment Corporation. Are you going to answer questions? If they could demand answers then - and, by the way, they got answers then - we can demand them now, and do.

Continuing with these readings from the past, the Minister of Economic Development and bankruptcies went on to say: "Mr. Chairman, if I represent 79 per cent of the shareholders in Can-Cel, do you not think I am entitled to some answers from this minister?" That's a fair question. Can-Cel was not a Crown corporation, neither is the B.C. Resources Investment Corporation. Can-Cel itself was not wholly owned by the government - at one time 79 per cent, and now 82 per cent of the shares. What he said then applies now. If they could demand answers regarding Can-Cel - they did, and they got them - we too demand answers, expect to get them, and will continue to ask them until we do.

In Hansard is recorded page after page of the Hon. R.A. Williams providing answers to the questions that the then Mr. Phillips raised in this Legislature. Our government was accountable for Can-Cel. We never took the dive. Our government, having never established Can-Cel as a Crown corporation in the first place, never used that as an excuse, in the second, to refuse to answer legitimate questions raised in this Legislature. Our government had the courage to defend what it did with Can-Cel. It had the pride to tell the people what a good move it was, and it had the willingness to answer questions here in this Legislature.

From a precedent which that group itself established, it's clear that the government of the day - then ours, now theirs - is accountable in a significant way for share ownership where they themselves have an active interest. Then it was Can-Cel; today it is the Resources Investment Corporation. The same rule surely applies. Or were they being insincere in those days? Did they not really mean it when they said they had the right to ask questions? Were they not really speaking the truth when they said they felt it was their duty to raise those points?

Mr. Chairman, the Premier has repeatedly said that the Resources Investment Corporation is to be governed by the Companies Act - which is to say that it is not to be governed by the Legislature but by the Companies Act. It will report to the shareholders and not to this House. It will answer questions at its annual meeting, but not in the Legislature.

The Premier's argument is entirely false and misleading. His own Act makes that perfectly clear. His own Act gives some very significant exemptions from some very significant dispensations of the Companies Act. Raw can he pretend it's governed by the Companies Act? The Act itself says that the Resources Investment Corporation legislation takes precedence over the Companies Act if either of those two should be in conflict. The Premier nods his head in agreement. Yes, that's right, Mr. Premier, it's in there. That's what Bill 87 said. That's what the Act today reads.

The Act says that, if there is a conflict between the Companies Act and the Resources Investment Corporation Act, the Companies Act is inferior. What kind of an argument was the Premier trying to make when he defended his silence over the last two weeks? He tells us that it is governed by the Companies Act. As usual, the problem with the Premier is that he tells one story here and another one there.

Interjections.

MR. BARBER: One doesn't want to point this out too uncharitably, but when he gets caught he runs away.

There are other exemptions, however, that

[ Page 998 ]

prove the arguments the Premier has made, about why he shouldn't answer for this corporation, to be false and misleading. He says it is governed by the Companies Act. Nonsense! His own bill makes it clear that it is not. His own bill makes it clear that when there is conflict between the two Acts, the Companies Act is inferior.

There's more. Under section 9 of the Companies Act the wind-up provision, as I understand it the B.C. Resources Investment Corporation is itself exempt. Specifically, the B.C. Resources Investment Corporation may not wind up its affairs, under section 9 of the Companies Act, without specific approval of the cabinet. Isn't that peculiar? He tells us that it's governed by the Companies Act, and therefore will not be accounted for in this Legislature.

MR. LAUK: What a phony!

MR. BARBER: Unfortunately, his own Act makes it clear that this is just not true, in that, under the provisions of the Companies Act, the Resources Investment Corporation may not wind up - only the cabinet can approve such a wind-up. Unfortunately for the Premier, he has been caught a third time.

It would appear that, unlike provisions for any other private enterprise incorporated under the Companies Act the resources corp. has its regulations made for it, not under the provisions of the Companies Act but by the cabinet itself, separately and exclusively from the provisions of the Companies Act.

What kind of hoax is this, Mr. Chairman? When they were in opposition they demanded answers about Can-Cel and they got them. We never owned 100 per cent of Can-Cel. Today we own 100 per cent of the resources corp. Neither Can-Cel nor the resources corp. is or was a Crown corporation. They demanded answers then, we demand answers now.

[Mr. Rogers in the chair.]

There are three significant exemptions from the provisions of the Companies Act in the resources corp. legislation. On all three grounds, the Premier's argument that it is somehow governed by the Companies Act and therefore not by this Legislature is false and misleading. His own bill makes that clear. Read the Act.

Regarding the resources corp. and the political swindle that it has become, remembering the metaphor about the television sets, let me talk about the board of directors of the resources corp. Let's talk about conflict of interest. I want to read into the record a most remarkable statement made by Mr. Jack Poole. Who is Mr. Poole? He's a well-respected and honoured-businessman, the president of the Daon Development Corporation and a member of the board of the B.C. Resources Investment Corporation.

MR. LEA: Who appointed him?

MR. BARBER: Who appointed him to the board? The Premier did. He is in fact, I'm told, a personal friend of the Premier. They actually like one another, Mr. Poole and Mr. Bennett. It's nice to hear that the Premier has some friends today, judging by the....

MR. LAUK: Don't slander Mr. Poole.

MR. BARBER: No, I shouldn't.

I want to talk about a conflict in statements. The Premier may not know this but Mr. Poole was in San Francisco on April 12 of this year. He was down there meeting with some people to discuss a Toronto-based Cadillac Fairview company project with which Daon is involved called the Shaklee Building on Market Street. He was to meet with the Canadian American Society of San Francisco. He made a most interesting speech.

Now before I read from the San Francisco Chronicle, April 12,1978, what Mr. Poole had to say about Mr. Bennett's government and Mr. Barrett's government, let me remind this House of what the Premier said just last night. He described the three and a half years of NDP administration in this province as a financial disaster for the province. He purported that it was bad for business; he purported that it was bad for the economy.

AN HON. MEMBER: Hear, hear!

MR. BARBER: Well, unfortunately for Mr. Premier, that opinion is apparently not shared by Jack Poole, the man he appointed to the resources corp. Last night the Premier claimed that the three and a half years of NDP administration were bad for business. Let's see what Mr. Poole had to say on April 12,1978, in San Francisco, California. I should, I suppose, restate that: Jack Poole, president, Daon Development Corporation, appointed to the board of directors to the B.C. Resources Investment Corporation by the Premier.

Now what did Mr. Poole have to say about the way we did things? You would think he had some respect for Mr. Poole's opinion. You would think he had some confidence in his judgment, wouldn't you, Mr. Chairman? After all, the

[ Page 999 ]

Premier appointed him. Let me repeat it: you would think the Premier would have some confidence in his business judgment; after all, , the Premier appointed him to the Resources Investment Corp.

What did Jack Poole say? "Besides, talking about doing business in the United States, it's very easy to do business in California from Vancouver. We're in the same time zone and we're closer to California than anywhere else except Alberta, just two hours away by air." Asked if "creeping socialism!' in Canada had added anything to California's capitalistic charms, Poole insisted: "Not in our case."

Get this. "We had some of our best years in British Columbia under a socialist government."

MR. LOEWEN: And we're paying for it now.

HON. MR. CHABOT: They ripped you off many times.

MR. CHAIRMAN: Order, please. The first member for Vancouver Centre on a point of order.

MR. LAUK: Mr. Chairman, we've been having good fun with the Premier but the Minister of Mines just shouted across the committee floor that Mr. Poole ripped us off many times. That is a slander against a businessman of this committee and a person appointed to a quasi crown corporation by the Premier. It is customary to withdraw these slanders or have the guts to go in the hall and say that. You're a cheap two-bit politician.

Interjections.

[Mr. Chairman rises.]

MR. CHAIRMAN: Order, please. I must ask the first member for Vancouver Centre to withdraw the word "slanderer" as applied to the Minister of Mines and Petroleum Resources.

[Mr. Chairman resumes his seat.]

MR. LAUK: Mr. Chairman, the Minister of Mines and Petroleum Resources has slandered a person with the immunity of this chamber. Until he withdraws that slander against Mr. Poole, I shall not withdraw my accusation.

HON. MR. CHABOT: Mr. Chairman, the member for Vancouver Centre is twisting again. At no time did I suggest any wrongdoing on the part of Mr. Poole. I suggested that the former government of British Columbia was taken.

SOME HON. MEMBERS: Oh, oh!

MR. CHAIRMAN: I must ask the first member for Vancouver Centre to withdraw his remark.

MR. LAUK: Mr. Chairman, my statement stands. Until the minister withdraws his slander against Mr. Poole that he took the government of the province of British Columbia, the statement stays.

MR. CHAIRMAN: The remarks made by the Minister of Mines and Petroleum Resources were pertaining to a member outside this chamber and the Chair is not empowered to ask....

HON. MR. CHABOT: Mr. Chairman, at no time did I intend to slander Mr. Poole.

SOME HON. MEMBERS: We heard you!

HON. MR. CHABOT: Well, I withdraw if it's suggested I intended to slander Mr. Poole. I just suggested we had an incompetent government in British Columbia for three years.

MR. LAUK: Mr. Chairman, trying to get that man to be honourable in this House is like pulling teeth, but I withdraw the comment that he slandered Mr. Poole, having now heard him withdraw such a suggestion.

MR. BARBER: As usual, the opposition appreciates the courage and good manners of the Minister of Mine Closures.

Mr. Chairman, this government cannot have it both ways. They cannot run around the province saying that the three and a half years of NDP administration were bad for business, and then hope that we don't notice the statements of one of its own senior appointees, made out of the country, about the same three and-a-half year period. Hypocrites can't have it both ways. May I repeat again, and add to it, the quotation from Jack Poole, in whom presumably the government, if not the Minister of Mines, has confidence. Mr. Poole, in California, on April 12 of this year, said: "Asked if I creeping socialism' in Canada had added anything to California's capitalistic charms, Poole insisted: 'Not in our case. We had some of our best years in British Columbia under a socialist government. It's simply not a political matter. Capital goes where the highest return is.' 11

It's no doubt true, and indeed the three and a half years of New Democratic administration in this province, most certainly on Vancouver Island and in the capital city, were some of the best this province has ever known - bar

[ Page 1000 ]

none.

I want to talk some more, however, about conflict of interest. I want to talk about conflict of interest which, in the case of the B.C. Resources Investment Corporation, means Austin Taylor. I want to talk about the board of directors and the four companies, one of which Mr. Taylor is a director, that have been involved in establishing the Resources Corp. The British Columbia Resources Investment Corporation has five interim directors, appointed by the Premier. They are: its interim chairman, Mr. John Pitts, who is the president of Okanagan Helicopters; Mr. Charles Woodward, chairman of Woodward Stores; Mr. Maurice Young, president of Finning Tractor and Equipment, and %to, I understand, resigned from BCDC in order to take this appointment; Mr. Trevor Pilley, president of the Bank of British Columbia; and Mr. Jack Poole, who thinks that three and a half years of the New Democratic Party in government in British Columbia were among the best that his company has ever seen. Jack Poole is the president of the Daon Development Corporation. I want to talk about these people.

MR. LAUK: Times were good.

MR. BARBER: Mr. Pilley, appointed by the Premier, is a member of several clubs and associations and a president of BBC Realty Investors. Mr. Pitts is a member of the Department of Industry, Trade and Commerce Advisory Council, of the Conference Board of Canada, and the Canadian Economic Policy Committee. He is also a director of B.C. Sugar Refining Limited, Grows Nest Industries Limited, Packard Inc., Royfund Limited, and B.C. Telephone Company.

Mr. Woodward is also president of Douglas Lake Cattle Limited and a director of the Royal Bank of Canada, Canadian Utilities Limited and Westcoast Transmission Company Limited. May I restate that? Westcoast Transmission Company Limited - the Premier raises the spectre of conflict of interest. Mr. Woodward is also a director of Great West Life Assurance Limited, Garibaldi Lifts Limited, Canyon Arrow Aerial Tramways Limited, B.C. Molybdenum, Vancouver Professional Soccer Club, and Associated Feedlots Limited, which presumably is another Socred front.

Mr. Poole is a director of Kaiser Resources and Great West Steel, and a number of clubs and associations.

Interjections.

MR. BARBER: I should have said that slower, shouldn't I? Let me try that again. I thought that was pretty good. Mr. Woodward is also a member of the board of Associated Feedlots Limited, which is, I presume, another Socred front. That was the joke, give me applause.

Now this is the board appointed by the Premier to give a nice appearance to the political swindle otherwise known as the B.C. Resources Investment Corporation. I would like personally to go on record as saying that the five gentlemen appointed are honourable, respected businessmen, and I do not for a moment question their integrity in this whole matter. They were obviously talked into something by the Premier. The Premier clearly has persuaded them of the merits of setting up the resources corp., and neither I nor any member of this opposition questions for a single instant, the integrity or the honour of the members of that board of directors. Indeed, we're quite happy to note Mr. Poole's high opinion of the NDP government, at least as he mentioned it in a speech in San Francisco a few weeks ago.

The resources corp. has a curious history. The resources corp., as managed by the Premier, has been, without doubt, delayed over and over again. I propose to discuss some of those reasons. However, I know one of my colleagues will get up for a moment and entertain intervening business, say hello to the Premier, and then I will return. Do you wish to do that now? Unless the Premier cares to answer some questions. We have a lot more on the resources corp., though. We've got a lot more on Austin Taylor, and I'm sure the Premier is looking forward to hearing it.

MR. BARRETT: In the main burden of the very excellent presentation of my colleague for Victoria, he asked very clearly what the salaries were of the executives appointed by the new resources corporation. It is taxpayers' money, and there is accountability. I ask the Premier of this province to tell us what those salaries are. Does the Premier wish to answer now?

Mr. Chairman, I think it's very simple. A number of questions have been asked. I thought the presentation from the member for North Vancouver-Capilano (Mr. Gibson) should be covered by the Premier. I'm not sure what should be covered on the presentation from the Socred member for Oak Bay (Mr. Stephens) , who is farther right than the.... He is the only genuine Tory we've got in this House. No question about it - the only genuine Tory in Canada! (Laughter.) His national party is going all over the ballpark looking for votes, but he knows he's not going anywhere but Oak

[ Page 1001 ]

Bay.

MR. CHAIRMAN: Perhaps you'd like relate this to the Premier's estimates.

MR. BARRETT: Mr. Chairman, I ask the Premier of this province to answer some of the questions that have been given to him including the series last night that I asked him. Does he think Westcoast Transmission has proven to be a good fiscal arrangement? Will he intend to get rid of the B.C. Telephone shares, and does he intend to sell the Bank of B.C. shares held by the government, purchased under the former Social Credit administration? The first pattern established of purchasing shares by a government was done by the Social Credit administration of W.A.C. Bennett. We still hold those bank shares. Would the Premier tell the people of this province if he intends to divest the government of those bank shares?

MR. BARBER: My next line of argument, Mr. Chairman, concerns the somewhat unusual delay in the establishment of the resources corporation. On August 23,1977, the now Premier said that the corporation would have its prospectus offered to the public by the end of 1977.

AN HON. MEMBER: He hoped.

MR. BARBER: He hoped. Very good. Lots of hope - that's what they had in Squamish, that's what they had at Dease Lake.

On August 23, that's what the Premier said. On September 1, the Act was given royal assent. On December 29, Mr. John Poole, appointed by the Premier, said that the evaluation of the assets to be transferred to the resources corporation was not concluded. He was not even sure that it had begun, and he thought that at the very least it would take another 30 to 60 days to conclude. On December 29,1977, he said that.

Now, Richardson Securities' resident partner in Vancouver, Richard Whittall, when asked which provincial department or departments had retained the four firms for the valuation job, suggested to a reporter from the Vancouver Province that he should "talk to Austin Taylor." It would appear that Mr. Whittall of Richardson Securities did not know what was going on, but he thought Austin Taylor might.

It's clear from the beginning, Mr. Chairman that Austin Taylor has had a most unusual; important role in the establishment of this corporation - in particular, in the valuation of its assets. Mr. Taylor, it should be pointed out, is a vice-president of McLeod Young and Weir. Mr. Taylor has also acted as fiscal chairman for the Social Credit Party of British Columbia.

Mr. Taylor was the man whom the Province reporter was referred to, to answer questions about the , valuation of the assets to be transferred to the B.C. resources corporation. However, unfortunately Mr. Taylor would not talk when he was interviewed by the Province reporter. I refer you to an article that appeared in the Vancouver Province, Friday, December 30,1977, written by Alex Young. Mr. Young is well known, but perhaps not quite so well regarded, by the Social Credit government of today. Quoting from the article which appeared on page 21:

"A spokesman for Richardson Securities, Vancouver resident partner Richard Whittall, when asked which provincial department or departments had retained the four firms for the evaluation job, referred the question to Austin Taylor. But Taylor said he was not at liberty to discuss the business of his firm's clients."

Very nice. He went on to say that he'd earlier done business for B.C. Hydro under previous administrations.

The questions of judgment, of sensitivity, of proportion and valuation were never required nowhere involved. Mr. Taylor wouldn't talk.

The assets were, in fact, transferred to the resources corporation, but not in the fall of 1977 as the Premier had anticipated. The prospectus was not issued to the people of British Columbia at the end of 1977, as the Premier had said would happen on August 23. The assets weren't transferred until March, 1978. Well, I have a series of questions coming up for the Premier regarding the issuance of the prospectus and when that will be released, questions about how it was organized. Indeed, on January 6,1978, in the Province again the Premier was reported as saying that the BCRC is not being organized "as quickly as I had hoped."

Now what was the reason for the delay? Clearly the Premier had wanted it going with the prospectus issued and the shares sold by the end of 1977. Just as clearly, the Premier had to admit that there was delay. What would be the grounds for delay? One might reasonably ask. Why would the Premier permit delay? One might question. To whose advantage would delay accrue? Well, let's look at Austin Taylor again. Mr. Taylor is, it should be pointed out, the fiscal chairman - or has been rather; I don't know whether he is this year, but he certainly has been - for the British Columbia Social Credit Party. Without doubt, Mr.

[ Page 1002 ]

Taylor, for whatever reasons, is a supporter of the Premier and of the present government. He may have even received a certain letter from the Premier, which shall be referred to.

What I want to know again, Mr. Chairman, is to whose advantage would delay accrue. If Mr. Taylor were involved in the valuation of these assets and the valuation were delayed for some reason, whose benefit would that be for? Well, it has occurred to a number of people, including this opposition, that the valuation of assets transferred to the resources corporation is enormously below market value and replacement value - enormously below that. Why would anyone want to transfer assets deliberately below the replacement value of them?

Now let's take a look for a moment at those assets. They are worth in total $151.5 million, so the Premier says. These assets were transferred by an order-in-council in March of this year. The assets include holdings in Westcoast Transmission, valued at $37.4 million; in B.C. Cellulose, valued at $64.3 million; in Plateau Mills, at $9 million; licences, petroleum and natural gas rights and benefits, $40.9 million; and apparently $1.25 for Kootenay Forest Products - a very unusual valuation.

In total, the British Columbia Resources Investment Corporation has taken over $151.5 million in assets belonging to the people of British Columbia. But, Mr. Chairman, what if those assets were really worth, say, half a billion dollars? What if, in fact, the replacement value for Can-Cel alone was worth almost $400 million? But let's be conservative for a moment. If one could anticipate that the replacement value for these assets, most particularly for Can-Cel, totals half a billion dollars, then in whose interest is it to deliberately undervalue them?Well, if one knew that the fiscal chairman of the Social Credit Party were involved very significantly in evaluating those assets, you might have a clue. If you knew that Austin Taylor was the bagman for Social Credit and represents Social Credit interests wherever and whenever he can, you might have a clue. If you knew that the valuation was deliberately delayed, and the Premier's own words make it clear it's late, then you might have another clue.

It's the clear judgment of this opposition that those assets have been delayed in transfer and reduced in value in order to make the previous administration look less worthy in its achievements regarding the corporations, and in order, quite deliberately, to make it appear that this government, in transferring assets to the resources corp., is transferring them at the least possible value. Presumably that will accelerate the sale. One wonders at the logic of that.

AN HON. MEMBER: It's a hell of a good price earnings ratio.

MR. BARBER: That's right. My colleague will be discussing that later on when we talk about the resources corp., but the price to earnings ratio will look quite remarkable %ten in the first annual report of the resources corp., having deliberately undervalued the worth of those assets, they then turn out to make a large profit on them.

AN HON. MEMBER: One hundred per cent a year.

MR. BARBER: One hundred per cent a year? Do you think that's possible? Do you think they'd try and compare that with its performance under the previous government to try to make it look better if they could?

MR. CHAIRMAN: Please address the Chair.

MR. BARBER: Mr. Chairman, the assets were transferred late on purpose. We believe they have been undervalued on purpose. What is the purpose served? It is the political purpose of Social Credit as represented by Austin Taylor, its bagman, vice president of McLeod, Young and Weir. It's the political purpose served by a government that does not have the courage to admit that the investments made under the previous government were good for the people, good for the province and good for the economy. Because again, Mr. Chairman, they cannot have it both ways, can they? They can't, for three and a half years in opposition, run around saying %hat terrible businessmen the NDP were, only to discover when in government that in fact these corporations are enormously valuable.

As my colleague the Leader of the Opposition has said, are you really going to try and sell shares in the resources corp., pretending that Westcoast Transmission shares are themselves worthless, that Can-Cel is worthless, that Kootenay Forest Products is worthless, that all of those were and are bad investments? They can't have it both ways. So how are they trying to get out of it? They delayed the establishment of the corporation. They delayed the transfer of its assets, and they have, in our opinion, deliberately undervalued the worth of those assets so as to maintain the continuing political hoax, that hoax being that somehow the investments of the NDP were no good.

[ Page 1003 ]

The point is, they were very good for the people of British Columbia - very good indeed. They've made money hand aver fist regarding Westcoast Transmission, and the government cannot abide the political embarrassment and irony. They were good investments then. They are good investments now. But let's get back to the question of the television set, Mr. Chairman. The point is, you and I already own that television set. The point is, if someone came to our front door trying to sell it back to us, we should slam the door in the face and call the police.

The replacement value for the assets that have been transferred is likely in the area of $500 million-plus. The government tells us it is only $151.5 million. We asked the Minister of Finance (Hon. Mr. Wolfe) during his estimates if he would tell us what arrangements he made with the four private companies, Pemberton Securities, Ames and Company, Richardson Securities and McLeod, Young and Weir, when they evaluated these assets. We asked him what they charged for that evaluation. He said they charged nothing. Well, he's got the Premier's disease - the next day he changed his story. He then turned around and said: "No, they didn't charge anything. We paid their expenses."

We said: "That's very nice. Now that we've learned they're not treating you as a charity case, will you tell us what the expenses were?"

"Yes, " he said. "You can get them through public accounts."

Oh. the problem is that they don't come to public accounts until the year 1980. We said this wasn't very good.

"Would you table them?"

He said: "Yes, I would."

He did not. He has not.

Maybe they have not been received. He may use that. That's a very reasonable. explanation. If they have been received, the Premier hopefully will know about it.

We have another question for the Premier. Will you table in this House the bill sent to you by Pemberton Securities, Ames and Company, Richardson Securities, McLeod Young and Weir for their services in evaluating the assets now transferred to the -Resources Investment Corporation? Will you table the bill?

Let me continue. We asked the Minister of Finance (Hon. Mr. Wolfe) to table in this House a copy of the contract that existed between his department and these four companies. The contract we presumed existed. We presumed that no government would ask four perfectly respectable financial houses to evaluate significant assets without the benefit of a contractual arrangement. You would think, Mr. Chairman, that at the very least they would have a contract in which the terms of reference, the criteria and the tests to be applied to the actual value of these assets would be laid out. They are, after all, they claim, good businessmen.

Well, what did we learn from the Minister of Finance? "Sorry, boys, there was no contract. We didn't do that." Well, that's very interesting. What did they do? We asked some more. Was there a letter, an exchange of correspondence? Once again, we're talking about $151.5 million, at least, in the public's assets to be transferred to a corporation for which the Premier will not accept responsibility. Was there a, -letter that outlined the terms of reference for the proposed valuation? No, apparently there ums no letter or, if there is, that was not the story the Minister of Finance told on that date. Perhaps on this date there will turn out to be a letter.

If there ums no letter, were there verbal instructions from the minister or his appointee? Well, if there were, he was, not prepared to tell us what they were. Not then and not since. The people of British Columbia have a right to know under what terms of reference those assets were evaluated. When, for instance, the Kootenay Forest Products organization is valued at $1.25, we have the right to know about that. The only excuse we've had so far is that there were deficits, accumulated deficits, and therefore $1.25 was a reasonable price.

It should be pointed out, Mr. Chairman, that a worker in Kootenay Forest Products himself offered to pay $12.50 for the company, 10 times the amount the government was asking from the resources corporation for its sale. The government wouldn't accept his offer. However, they did accept $1.25 from the resources corporation.

The people have a right to know what tests, what measures and what criteria have been applied regarding the valuation of these assets before they were transferred to the corporation. For that reason, because we have not been given that information, we can only presume that the unusual delay for which the Premier himself has provided some answer, for that unusual delay in which one Austin Taylor, bagman for Social Credit was involved, for that unusual delay that has yet to see the prospectus issued, it may be the terms of reference directed to the four financial houses are embarrassing to the government.

Maybe they told the companies that they preferred not to assess the replacement value but simply the lowest possible value based on

[ Page 1004 ]

share price at the day they conducted their particular assessment. Maybe that's what they did. Maybe they even did it on minority share price. Maybe they asked the companies to choose the lowest possible quotation that a minority shareholder might have in his hand the day the valuation occurred. Is that possible? They ignored replacement value, they ignored the real assets, they ignored the question of the value of the land. They didn't even look at the majority shareholdings. They looked at the minority shareholdings. They quoted deliberately the lowest possible price and then they brought that aboard.

It's a matter of public record that in fact Can-Cel shares were somewhat down in September and October of last year. It's a matter of public record on the exchange. The sales at that time were somewhat depressed. They've since gone back up. That too is a matter of public record.

What we are arguing, Mr. Chairman, is that this government has refused to table the terms of reference with regard to the valuation procedures on purpose. We suspect that the instructions in fact were not written at all. They were verbal. How convenient. Would that the member for Omineca were so lucky they were only verbal and not transcribed. Be that as it may, I ask again the Premier to tell us here in this House, where you are accountable for the corporation, what were the terms of reference, what were the tests, the measures and the criteria to be applied? When were they applied? Who did it? Tell us how much it cost to have this done. What expenses were charged? What expenses have been paid? Tell us in particular: did Austin Taylor himself receive any special remuneration for his no doubt most worthy services?

We have more questions. They concern policy.

Now these are not questions of the maladministration of the corporation. They are not questions concerning delay. They are not questions regarding conflict of interest between the role of Mr. Taylor, the Social Credit Party for which he is the bagman, and the firm for which he is the vice-president involved in the valuation of these assets.

They are questions of policy and they are most important questions. You see, one of the things that has occurred to us might possibly be the case, Mr. Chairman, is that B.C. Resources Investment Corporation may end up in conflict with the British Columbia Development Corporation. Indeed, the Premier himself and John Pitts, the interim chairman of the resources corporation, have already hinted as much. Let me take a look at what some of them have said. Let me take a look, for instance, at what Mr. Helliwell said. Mr. Helliwell, in The Province of March 4,1978, said, regarding the assets that were, if I recall, shortly to be transferred to the corporation:

"We want to find out what we have been given and then build on that base. I certainly feel the base is there for the company to be very successful. The corporation holds about two million-plus acres of petroleum and natural gas rights and will have the right to farm them out to other companies for exploration. The corporation will not be directly involved in exploration."

Well, unfortunately, that's not %hat the Premier said. The Premier on June 10,1977, in The Province - I'm sorry, I don't have the page number: "Once the corporation is established, the board of directors will be free to take it in any direction they want." Let me repeat that: "Take it in any direction they want."

It's our money they are taking, Mr. Chairman; it's our assets they are taking in any direction they want.

"He suggested the capital it raises might be used for both investment and development in B.C. Because it is expected to acquire large amounts of capital, it might be a suitable vehicle to undertake major developments such as the construction of a new pulp mill. He said these ventures might be undertaken by the new corporation alone or in concert with other companies."

Let's back up for a minute. What did Mr. Helliwell say? He said, referring to one of the significant assets of the corporation -that is, the two million-plus acres of petroleum and natural gas rights, that they will not be involved in exploration. He specifically said that the corporation will have the right to farm them out to other companies for exploration. Now which way is it? Will the resources corporation be involved in joint ventures, joint exploration and joint development or not? Will they try to recoup at least a little of the loss the people have already suffered, by the fact that this political swindle occurred in the first place, by engaging with capital jointly and mutually in enterprise along the lines of the several assets it owns?

Well, according to Mr. Helliwell, at least in the field of petroleum and natural gas, they will not do so. According to the Premier, in other fields they might. Let me quote again from the Premier, talking about the Resources Investment Corporation in The Province on August 24, 1 believe it is. The Premier on

[ Page 1005 ]

August 24, however, had changed his story; the Premier's story on August 24 conflicted with his story on June 10, which in turn conflicted with the story on March 4 of Mr. Helliwell.

Interjections.

MR. CHAIRMAN: Order, please. I'm having some difficulty hearing the second member for Victoria (Mr. Barber) . Perhaps if some of the other members could constrain themselves.

MR. BARBER: The argument that I'm leading to, Mr. Chairman, is that the new corporation may well be in conflict with the B.C. Development Corporation, , particularly in the field of joint ventures with private capital. The argument is a very significant one and I wish the Premier would listen because it's a question of policy. It's not a scandal, it's not a contradiction, it's not a conflict of interest, it's a question of policy. Will the corporation be in conflict with BCDC or not? And let me read to you your own words.

On March 4, Mr. Helliwell, your awn appointee whose salary you will not tell us, said that the corporation will not be involved in joint ventures in the field of petroleum and natural gas. On June 10 the Premier contradicted him and said - not referring to those questions but rather to the other matters in the portfolio of the corporation - that you will be involved in joint ventures and you named a new pulp mill. However, the Premier changed his story again by August 24, again in The Province:

"The Premier also stressed that the second purpose of the Act is to give British Columbians a chance to invest in the province's resources. He said, 'Because income from the share issue will create a large cash reserve, the new corporation will be able to immediately invest in major resource developments like a pulp mill, pipelines and natural gas as well as secondary industries."'

So in March Mr. Helliwell says: "No, we won't be involved in joint ventures with petroleum and natural gas." However, the Premier, who says he doesn't give the corporation direction, in August says: "Yes, we will be involved in such questions as petroleum and natural gas joint ventures."

HON. MR. MAIR: He didn't say that at all. Why don't you read what he did say? He said it could be.

MR. BARRETT: Oh, could be. Oh, pardon me. Could be. It's not a little "should, " it's a big "could." This is very persuasive. Unfortunately it didn't persuade George Froehlich, the business editor of The Vancouver Sun.

Interjections.

MR. BARBER: What did he say? He quoted the Premier directly in The Vancouver Sun of August 27,1977. Now this is not a journalist's paraphrase; these are evidently direct quotations from the Premier. Let me remind the committee, Mr. Chairman, that the Premier appointed the board of directors, the Premier approved of the appointment of Mr. Helliwell, the Premier is accountable in the Act for the administration of the corporation. And here is what the Premier said, as reported in the business column of The Vancouver Sun, byline George Froehlich, August 27,1977, quoting the Premier directly:

"It's" - the corporation - "not restricted to the resource field, but could play a part in the development of manufacturing and secondary industry as well. We see a great future and opportunity for this corporation with its existing assets, and the potential of the petroleum and natural gas rights are an important part of the present and future of this corporation."

"Bennett also hinted at the projects the corporation could become involved in. 'The funds would go into the corporation and would be available for new ventures and for expansion of new assets. You have only to look around and see the need for new pulp mills, the expansion of the forest industry, the opportunities in gas and petroleum products, and in coal, and the opportunities to help participate in the development of secondary industry.... Once the corporation is set, it can get involved in all sorts of joint ventures with local businessmen or those outside the province.' "

I don't believe for a moment, Mr. Chairman, and neither do you, that this Premier has no influence with the board of directors of the Resources Investment Corporation. I don't believe it and the public doesn't believe it either. The Premier appointed the board. The Premier wrote the Act. The Premier is the administrator of the Act. He has enormous influence with the corporation. He is, at the moment, the president of the executive council, which owns 100 per cent of the shares in the Resources Investment Corporation. Or is he running away from that one, too?

The policy dispute at hand is simply this: will the new corporation be in conflict and/or competition with the B.C. Development Corpor

[ Page 1006 ]

ation? Specifically, we understand that both the British Columbia Development Corporation and the Resources Investment Corporation are interested in new development, new industry and new technology. That is very good. It was our previous government that set up the Development Corporation.

We have more questions and more debate, but I understand the Leader of the Opposition (Mr. Barrett) is going to say hello to the Premier. I will be back in a moment with a question concerning conflicting priorities and competing performance between the Development Corporation and the Resources Investment Corporation, both of them established by the government of British Columbia.

HON. MR. BENNETT: Mr. Chairman, the leader of the Liberal Party (Mr. Gibson) expressed some concern regarding coal policy in British Columbia. One of the difficulties in estimates is not being able to deal with items, that could be anticipated in legislation. I must advise the leader of the Liberal Party that in many of his assumptions he is dwelling on what may be future legislation or measures. This makes it very difficult at this time to respond to his concerns.

The leader of the Conservative Party (Mr. Stephens) was concerned about this government debating in a stronger way the free trade policies of this government which have been a policy of this party for many years and one advocated at many First Ministers' Conferences in the past: the policy of free trade as an economic way for Canada to go in the future; to resolve many of our economic problems are not just the policy of this government. We believe it is the way to go and we believe the policy we advocate as part of our economic strategy for Canada to be an answer to the current difficulties and to the current dilemmas that face this country. Free trade has been advocated by many of the top economists in this country, and by the most respected institutions, none of which serve the interests of the New Democratic Party.

I could draw to the attention of the Leader of the Opposition what free trade would mean to this province. The Leader of the Conservative party outlined part of it: it would immediately lower the price of consumer goods.

Let's start with the fact that the Leader of the Opposition (Mr. Barrett) is against lower prices for British Columbia.

MR. BARRETT: No jobs.

HON. MR. BENNETT: That's what he is saying when he says that he wants high tariffs to protect the manufacturing of control Canada. The Leader of the Opposition, the economic architect of the NDP years in this province, is now telling the people of B.C. that he supports the higher consumer prices that we pay in this province and is defending the old economic policy that has led our country to its present dilemma. Let me say that he has no support anywhere - I wouldn't think even in his own party.

Look at the forest industry. Our forest industry competes well, but what about value added into fine papers and things like that? A question was asked of us: why don't we have more value added in fine papers, which would be more labour-intensive? Because of the tariffs that the Americans have put up so that we can't penetrate their market. You know, we penetrate their markets pretty well with our forest products, but, because of the tariffs that that Leader of the Opposition is in favour of, he doesn't want our people to have the value-added and the extra manufacturing in this province. He wants those markets to continue to be closed.

The Leader of the Opposition not only wants higher prices for B.C., he wants to see the discrimination against our workforce continued in this province. He talks about the very policy of tariff reforms that would force Canadian companies, companies that can develop in the market here, to establish other companies down in the U.S. in order to be allowed to sell there, because they have to manufacture there because of the tariffs. That's what he talks about. He's talking about us having to create a branch-plant economy into the U.S., not having one large plant with Canadian workers manufacturing and supplying the goods.

Mr. Chairman, quite clearly, the Leader of the Opposition doesn't know what he's talking about, but that's not news to the people of British Columbia. It's certainly not news to this assembly, and it's not news to me. His defence of high protective tariffs is ludicrous at best, laughable, but very shocking for someone who was a former Premier and was a Finance minister in this province. He is trying to defend the very policies that have led this country to its present economic difficulties. He's in favour of the high prices that British Columbians; pay to protect manufacturing in central Canada. I'm surprised that he would make it so clear.

I'm going to have to go out and tell the people of this province that the leader of the New Democratic Party has stated unequivocally in this Legislature that he believes in a policy that will continue to have British Columbia consumers paying high prices, when we

[ Page 1007 ]

could have much lower-priced consumer goods. I'll have to tell those in the forest industry that he doesn't want the expansion in the forest industry from pulp and paper to fine papers, that he would rather have those jobs developed and held in the United States and have them deny access to our products. I'm going to have to tell then that he doesn't want jobs in the forest industry. He doesn't want low prices for our people.

What he wants to do is to follow, because the NDP's best chances are in Ontario federally, the party line at the present time to protect central Canada manufacturing, industries that are not competitive but are denying us access to foreign markets while at the same time having to pay higher prices. That's ridiculous, Mr. Chairman. Let the people know exactly where he stands, or doesn't stand, or floats, or whatever it is he's doing.

The former Minister of Human Resources who shovelled all that money out of the back of the truck is quipping from his seat. Let me talk about statements made by.....

Interjections.

MR. CHAIRMAN: Order, please, hon. members. Order, please, Mr. Premier. I must ask the members of the House to curtail their cross floor comments for a while just so that the Chair can hear-your debate. Perhaps we could have a little decorum, as we are now approaching not too far from the dinner hour. A little peace and quiet might be very pleasant change in the chamber.

HON. MR. BENNETT: Let me talk about the B.C. Resources Investment Corporation, because indeed that is what it is. It is a corporation that will be a public company in the private sector - just that. Two things: it will transfer from government assets either notes or shares to be developed in a prospectus, and it will provide an opportunity for the people of British Columbia to voluntarily make a choice to harness their savings. It's not a choice dictated by the government of the day that took u ' into itself unlimited power of investment, you know. It has no power to gamble on the stock market for Dave the Greek. But, Mr. Chairman, it is to give them a voluntary opportunity to make an investment selection, something that I believe they have the educational capability and basic right to do. It's their own discretionary income.

Interjections.

HON. MR. BENNETT: Mr. Chairman, could I have some order, please?

MR. CHAIRMAN: Please continue.

MR. MACDONALD: On a point of order, I heard the Premier call somebody "Dave the Greek."

HON. MR. BENNETT: That's an old expression from a famous gambling person in Las Vegas.

MR. LEVI: The name is Nick the Greek.

HON. MR. BENNETT: Oh, I'm sorry, I made a mistake - Nick the Greek.

MR. MACDONALD: Mr. Chairman, I have the assurance of....

HON. MR. BENNETT: If Nick the Greek ever comes to British Columbia, then we're not going to let him become our Premier and gamble with our....

MR. BARRETT: On a point of order, it's not quite that funny, and it's Jimmy the Greek. I think the Premier is....

HON. MR. BENNETT: All right, Jimmy the Greek.

MR. CHAIRMAN: Order, please. I must listen to the point of order. The Leader of the Opposition has a point of order.

MR. BARRETT: Well, Mr. Premier is making his own measure of his own standards in the debate.

MR. CHAIRMAN: That's not a point of order.

HON. MR. BENNETT: If the most famous high roller in Las Vegas of all time ever comes to British Columbia with the powers that were held by the former Minister of Finance (Mr. Barrett) , who, under the Revenue Act, gave himself the opportunity to gamble undebated in the Legislature....

I must say that we have taken away those powers from the office of the Minister of Finance. The changes to the Revenue Act have been made. That's why assets had to be transferred by bill. When setting up the B.C. Resources Investment Corporation, not only did it set up this vehicle to harness public investment, but, Mr. Chairman, what it also did ums to give the members of this assembly at that time a chance to debate on the transfer of the assets as well. Those assets were identified along with the measure. It gave them a chance.

[ Page 1008 ]

In past times in this Legislature, the Leader of the Opposition has asked for a list of the companies or assets the government may sell. That study is going on where we're studying Grown corporations, boards, commissions and others that are not necessary to the function of government, and that may not be in the public interest.

MR. LEA: Name them.

HON. MR. BENNETT: The B.C. Housing Corporation, formerly Dunhill Development.

MR. LEA: What else?

HON. MR. BENNETT: Well, we're studying.

SOME HON. MEMBER: Oh, oh!

MR. CHAIRMAN: Order, please, hon. members. Perhaps if the Premier would address the Chair, it make the job of the Chair a little easier.

HON. MR. BENNETT: Mr. Chairman, through you to the member for Prince Rupert (Mr. Lea) , we're studying it. Now to get back to the B.C. Resources Investment Corporation. The member for Victoria (Mr. Barber) pays great credit to the interim directors, and that's what they are - interim directors. I thank him for that because they are, in my view, outstanding British Columbians who have a contribution to make and have made a contribution in this province. I love him quoting Jack Poole in his concern about creeping socialism, saying he did well under that particular time in British Columbia. He may have. What I'm saying is the creeping capitalism we're introducing with the B.C. Resources Investment Corporation means that more people will have the opportunity to do well and not just the major building companies.

MR. SKELLY: With the people's money.

HON. MR. BENNETT: We want everyone to have some of their best years and creeping capitalism will be the way. Give them an opportunity for everyone to have some of their best years.

You see, what that party over there does not realize is that when you make a discretionary investment, you have the right to buy on your own and to sell on your own when you require the cash. When the government acquires assets and plays the market, it doesn't have any right to ask when they buy, when they sell.

They do not get the interest in dividends. What dividends came into general revenue and then out into benefits for people? None. None came from those corporations into consolidated general revenue, back into health plans or any of the government services.

AN HON. MEMBER: What about the Petroleum Corporation?

HON. MR. BENNETT: We'll talk about the Petroleum Corporation later. I saw a very interesting programme on CBC television the other night, in which the reporter was investigating the unusual relationship created between Westcoast Transmission and the B.C. Petroleum Corporation, and the guaranteed profits that that deal gave to Westcoast Transmission. We'll be discussing that in the Legislature in the future. The relationship that was established at that time by the former government will be interesting for further debate.

Interjections.

MR. CHAIRMAN: Order, please, Mr. Premier. Hon. members, I would just read from page 433 of the 19th edition, subsection 3: "Rules of Behaviour for Members not speaking." This is a part of May we haven't canvassed recently, and perhaps if I were to go through it again... : "The rules to be observed by Members present in the House during a debate are to keep their places; to enter or leave the House with decorum; not to cross the House irregularly; not to read books, newspapers and letters; to maintain silence; not to hiss or interrupt."

There have been several interruptions. Between now and 1800 hours, which is the normal time of adjournment for dinner, if hon. members could just obey that little rule, we could perhaps hear the next speech quite quietly.

Would the Premier please continue?

HON. MR. BENNETT: Mr. Chairman, let me make it clear that, with respect to the B.C. Resources Investment Corporation, the authorization for such a corporation was the B.C. Resources Investment Corporation Act. For such a new company to be incorporated, there is the preparation of a prospectus. The interim directors are there only until such a time as a prospectus is prepared, has cleared all the securities regulations, and is offered to the public.

AN HON. MEMBER: But they own it already.

HON. MR. BENNETT: After the public have made their voluntary investment and removed the

[ Page 1009 ]

control of this from the government of the day, the government, for its interest and any continuing interest, has a formula that spells out the way it can be represented on the board. At that time they can have an opportunity to make their share of capital interest known, but they cannot have a majority on that board, nor will they control the company. It will truly be a public company in the private sector.

After the company has been taken public, it must, within a specified length of time....

Interjections.

HON. MR. BENNETT: Well, this will be a matter of choice that the people of British Columbia can make up their minds on.

MR. BARRETT: But they've already paid for it.

HON. MR. BENNETT: ... on the value of it as an investment. But after it has gone to the public, there then must be an annual meeting within a specified length of time. Mr. Chairman, I know you're interested, and I'm sure you're having a difficult time listening over the member for Alberni (Mr. Skelly) and Prince Rupert (Mr. Lea) , the Leader of the Opposition and others of that refined party over there.

Mr. Chairman, they will elect a new board of directors. It may or may not include one or all of the interim board of directors. Their responsibility was first of all to negotiate the assets at arms length from the government.

MR. BARRETT: Austin Taylor at arm's length! You've got him in an embrace. Arm's length, my eye!

HON. MR. BENNETT: The Leader of the Opposition is making charges against an individual. The Leader of the Opposition just made charges against an individual, and I'm sure you'll make those charges out in the hall.

MR. BARRETT: He said himself he's a bagman for you.

HON. MR. BENNETT: I'm sure in the relationship which you talking about, the evaluation and the arm's length negotiation of this corporation....

MR. BARRETT: He was a self-admitted bagman for Social Credit.

HON. MR. BENNETT: Mr. Chairman, there's the

Leader of the Opposition, who has trouble understanding conflict of interest. I would know that when the evaluations come in, which were assessed by senior public servants, and under the advice of the financial managers to government that were appointed by the former Minister of Finance. I don't know if that's the member for Nanaimo (Mr. Stupich) or his predecessor, the one he tried to bail out -the former member for Coquitlam and the former Premier of the province (Mr. Barrett) - but they were the financial managers. Indeed, I wonder if the integrity of Ames, Richardson, Pemberton, and McLeod, Young and Weir are being questioned in this House.

I wonder if it's a sin for the many people who are qualified in those corporations. I wonder, Mr. Chairman, what the attack is on any of the members of those corporations. Those corporations....

MR. BARRETT: It's on you. You're the one who said it.

HON. MR. BENNETT: Don't be silly, you silly little man. I was considering last night, when you said your wife was trying to make you eat lettuce, that it probably would be very healthy for you. I eat it all the time. It's better than white bread and sugar and junk foods and potato chips and all those things.

Mr. Chairman, I'm trying to talk about the B.C. Resources Investment Corporation.

Interjections.

HON. MR. BENNETT: I want to explain to the second member for Victoria (Mr. Barber) that there is a very big difference between the B.C. Development Corporation and this company - a very big difference.

The B.C. Development Corporation is an arm of government that is there to assist business and individuals in this province. There is no conflict between them. One is a private-sector corporation, the other is an am of government.

Let me also say that when the interim directors and the new directors take control after the issue has been taken public and the public have invested in this corporation, they are the ones who will direct the investments of the corporation. The possibilities we have suggested for that corporation are just that. Your own quotations suggest that. The possibilities are endless in what this corporation could do in British Columbia. The possibilities are endless. They are just that. That will be at the discretion and direction of the board of directors elected after that corpora

[ Page 1010 ]

tion has had its public issue and after it has had an annual meeting to elect a new board of directors as specified in its incorporation.

of course you know that the government, no matter what the percentage of shareholdings the government may hold depending upon the final prospectus, is limited by the Act as to the number of directorships it can hold, but it will be represented on the board. This is to guarantee the autonomy of the corporation so that it can act free from conflict of interest from government. That is exactly why that was put into the Act. This corporation will be a great opportunity for the people of British Columbia. They can buy the shares on their own volition; they can sell them when they wish; they can hold them as long as they want. It is not an arbitrary, unilateral action by one man, as Finance minister or as Premier in the government. Those powers have been taken away. The people of British Columbia do not want government arbitrarily to make their investments for them. They have told us very clearly they think that government has intruded into many areas that would be more properly served by private sector. But, more important, in moving into more areas and higher taxation to meet the aims of some who would be government, they are taking more and more income away from our citizens. They are saying: "Give us more in taxation." So the 40 per cent that the governments are taking today could have been 45 per cent had we continued on the same, - acceleration of government expenditure; it could be 50 per cent; it could be 55 per cent; it could be 60 per cent as the government says more and more: "We know what is best for you. You cannot manage your own affairs."

MR. LEA: "So we'll sell them to you."

HON. MR. BENNETT: The Leader of the Opposition (Mr. Barrett) and his cohorts say to the people: "You cannot even be entrusted in what is your undeniable right of a people in a free society to make a voluntary investment and have control over your own discretionary income."

I believe that the NDP have forgotten one of the many reasons they were defeated in 1975. That was it. If you don't learn by your mistakes, that's fine with me. It takes away the threat of your ever coming back. I would have thought that you would have understood the basic right of ownership at the discretion of your own purchase - the right to buy and the right to sell.

Now, Mr. Chairman, someone asked a question about some- of the shares and holdings that are still within government. As I say, they are being studied. But two areas, the B.C. Telephone shares and the Bank of B.C. shares, are owned by the public superannuation funds and they are not within the cash reserves of the provincial government of the day.

Mr. Chairman, I would also point out that Westcoast Transmission has increased in value. I think the support - but not for that reason - and the fact that they participated and shown the vision to be part of Alcan pipeline has made their shares and their expectations stronger. That didn't happen and that wasn't known when the investment took place. That's something that happened since, Mr. Chairman. To try and take credit for seeing two or three years down the road....

MR. BARRETT: We had confidence.

HON. MR. BENNETT: Yes, that former government, if nothing else, had confidence.

So, Mr. Chairman, I know that the second member for Victoria better understands now the opportunities that are available in BCRIC. I might also say to him that I don't know, because the directors have hired Mr. Helliwell, but I believe that information must be part of the prospectus, along with any directors' remuneration. I don't know why.... They are completely at opportunity to take the public into their confidence now. I was not part of the decision, I was not part of the hiring procedure and this is not a Crown corporation. While they are in this position, they have the rights of a private company.

The House resumed; Mr. Speaker in the chair.

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

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

Hon. Mr. McClelland moves adjournment of the House.

Motion approved.

The House adjourned at 5:57 p.m.

[ Page 1011 ]

APPENDIX

30 Mrs. Wallace asked the Hon. the Minister of Agriculture the following question:

With reference to expenditures on 4-H programs-

What was the total expenditure and the number of staff employed in the years 1972,1973,1974,1975,1976, and 1977?

The Hon. J. J. Hewitt replied as follows: