[ Page 279 ]

CONTENTS

Routine proceedings

Oral questions.

Nuclear power. Mr. Barrett –– 279

Ambulance services. Mr. Cocke –– 280

Sale of railcar plant equipment. Mr. Leggatt –– 281

Matter of Urgent Public Importance

Protection of fishing boundaries. Mr. Lea –– 281

Public Schools Amendment Act, 1979 (Bill 13). Committee stage.

On section 1.

Mrs. Wallace –– 282

Mr. Cocke –– 283

Hon. Mr. McGeer –– 283

Mr. Skelly –– 284

Mr. Ritchie –– 284

Mrs. Wallace –– 284

Division –– 284

Report and third reading –– 285

British Columbia Hydro and Power Authority (1964) Amendment Act, 1979 (Bill 11).

Second reading.

Hon. Mr. Wolfe –– 285

Mr. Skelly –– 286

Mr. Davis –– 288

Mr. King –– 291

Mr. Brummet –– 294

Mr. Leggatt –– 295

Mr. Barrett –– 296

Mr. Cocke –– 300

Hon. Mr. Hewitt –– 301

Presenting Reports

Ministry of Highways and Public Works. Hon. Mr. Fraser –– 304

Auditor-general audit report.

Mr. Speaker —304

THURSDAY, JUNE 21, 1979

The House met at 2 p.m.

Prayers.

MR. ROGERS: On the floor of the House today we have a special guest, a parliamentarian from the state of South Australia who is on a round-the-world tour. He happened to be in Seattle yesterday and took the Marguerite up today just to see this legislative session, and is going back at 4 o'clock. I know the members will want to make especially welcome Mr. Graham Gunn from South Australia.

MR. BARBER: Mr. Speaker, I should first of all, on behalf of my colleague for Victoria (Mr. Hanson), like to introduce and welcome to the House today Mr. and Mrs. Fred Baturin. I would like also, if I may, to introduce a couple of people whom I had the privilege of meeting in Montreal in March of this year when I was back for the Vanier Award ceremony. These are two people very active with the West Island Jaycees in the city of Montreal, and they have since become good friends of mine. They are visiting on the west coast. Their names are Norm and Pat Goudet, and I ask the House to make them especially welcome.

HON. MR. McGEER: Mr. Speaker, in your gallery today we have some visitors from the University of British Columbia, with Dr. Hindmarch, five lovely young ladies and a gentleman. Unfortunately for you, they are in your gallery and out of your sight: Dianne Abbott, Colleen Kirk, Yvonne Magnusson, Barbara Panton and Brenda Luck, along with David Hindmarch. They are doing a study this summer on physical education in our post-secondary schools, and will be tendering a report at the end of the summer.

HON. MR. NIELSEN: Mr. Speaker, we have some guests visiting the House today from Richmond and Manitoba. I would like to introduce a very dedicated Richmond citizen, Mrs. Helen Mytko, and her children Karen, Kevin and Terry, and Mrs. Mytko's aunt from Manitoba, Mrs. Isobel Nackoney, and her grandson David. I would like to welcome them.

HON. MR. WILLIAMS: Mr. Speaker, I would ask you and the members to welcome two visitors from Shropshire, hard by the Welsh border, who are visiting our province. They are Phillipa Webb and Sion Kealy from Church Stretton. These two charming young ladies are attending the University of Ottawa. They are visiting British Columbia to make up their own minds as to why the west is reputed to be better than the east in this nation of ours.

After a few days in Victoria they're going to Long Beach, and then they hope to reach the Yukon before they return to the east. In the course of their visit here they are meeting with Mr. Jim Hume of the press gallery and other oddities in our province. Perhaps the House will welcome them and Mr. Roy Temple, who is escorting them today.

MR. RITCHIE: I have someone in the House today whom I'm very proud of. Mr. Speaker, I'd like to welcome to this House one of my nephews, Jim Ritchie, and his friend Elaine.

Oral Questions

NUCLEAR POWER

MR. BARRETT: Mr. Speaker, I'd like to address my question to the Minister of Education, Science and Technology. Could he tell me whether or not he agrees with the statement by the head of B.C. Hydro that nuclear power is both desirable and inevitable for British Columbia?

HON. MR. McGEER: Mr. Speaker, the Leader of the Opposition woke me out of a hibernation from the time the session started. With respect to policies on nuclear power for the province of British Columbia, they've been expressed by the Premier and I would refer the Leader of the Opposition to the Premier.

MR. BARRETT: And supplementary, is it the opinion of the minister that nuclear power is necessary and desirable for British Columbia — as Minister of Science and Technology and out of hibernation?

HON. MR. McGEER: I've already explained that the Premier will announce government policies with respect to nuclear power for British Columbia.

MR. BARRETT: I have a further supplementary, for the member of the cabinet who's on the board, the Minister of Energy, Mines and Petroleum Resources, Agriculture, et cetera, et cetera. I would ask that minister if Mr. Bonner has been authorized by the board of directors of B.C. Hydro to state the position that B.C. Hydro would be in favour of nuclear power being developed in British Columbia. As a member of the board of directors of B.C. Hydro, can you say if that is the position of the board of directors?

HON. MR. HEWITT: The decision as to whether nuclear power ever comes to British Columbia will be the decision of government.

MR. BARRETT: On a supplementary. Is the minister saying, then, that all hydro policies on future developments will be made by government?

Interjection.

HON. MR. HEWITT: I was waiting for my colleague on my right to give me an expression that was suitable for the Leader of the Opposition, but I didn't quite hear him; besides, that is unparliamentary.

The Leader of the Opposition is well aware of the concern this government has — and I guess any government would have — in regard to power projects in the province. B.C. Hydro, when they took at future power requirements for this province to meet the demand of industry, trade, commerce and residences, realize certain procedures are to be followed. Statements being made don't necessarily bind this government.

MR. BARRETT: My question to the minister was: will all decisions on future power developments be made by the government?

[ Page 280 ]

Interjection.

MR. BARRETT: In British Columbia, by B.C. Hydro.

HON. MR. HEWITT: Yes, I guess, Mr. Speaker, the government determines government policy. That should be a sufficient answer.

MR. BARRETT: Mr. Speaker, I'm trying to find out who determines B.C. Hydro policy. I know who determines government policy. Would the minister inform me to who determines the ultimate decision-making process and who is responsible for the decision as to whether or not nuclear power or any other power source will be developed by B.C. Hydro in British Columbia?

HON. MR. HEWITT: Yes, Mr. Speaker, B.C. Hydro, as the Leader of the Opposition is well aware, is a government Crown corporation, and no development would be contrary to stated government policy. He is also aware that any determinations in regard to B.C. Hydro power projects have to clear various hearings, regulations, et cetera, before they can proceed.

MR. BARRETT: On a further supplementary question. Mr. Speaker, I am thus able to read into the minister's convoluted answer that, yes, the government is responsible for saying yes or no to specific hydro projects. Is that correct?

Having assumed it is correct and that the government is responsible, would the minister...? Is the government responsible, ultimately, to say yes or no to a specific Hydro project'?

AN HON. MEMBER: We're the shareholders, obviously.

MR. BARRETT: Yes. Therefore I would like to ask the minister if he will be asking for the resignation of Robert Bonner for continuing to espouse the development of nuclear power in the province of British Columbia. Who runs the show here?

Interjections.

MR. SPEAKER: Order, please. The question "will he?" is out of order. The question "has he?" is in order.

MR. BARRETT: Has he?

HON. MR. HEWITT: First of all, the government sets the policy; B.C. Hydro is a Crown corporation. B.C. Hydro cannot proceed on any avenue which is contrary to government policy — nod your head, Mr. Lea of the opposition, if you agree with that response. He's not sure; he scratches his ear. In regard to Robert Bonner's statements, they do not commit this government, and the Leader of the Opposition knows that. You asked if I have asked for Robert Bonner's resignation. The answer is no.

MR. BARRETT: Has the question whether to go ahead with nuclear power ever been discussed at a B.C. Hydro board of directors meeting?

If I have not an answer whether it has been discussed at the board of directors, would the minister inform me whether he question has been discussed at cabinet level?

MR. SPEAKER: That's not in order.

MR. BARRETT: Has it been discussed? It's not a question of policy. I just want to know what's on the agenda.

MR. SPEAKER: Hon. member, the question is not in order because matters which pertain to cabinet confidentiality must not be asked during question period. So that the Leader of the Opposition understands, perhaps I should refer him to section 171(g)(g).

MR. BARRETT: Thank you, Mr. Speaker.

A final question to the minister on the B.C. Hydro board of directors. Would he inform this House what his position is on the question of nuclear power for British Columbia?

AN HON. MEMBER: Order! What's that got to do with his ministerial responsibilities?

MR. BARRETT: What is his position? It's not a question of government policy. What is your position on nuclear power for British Columbia?

SOME HON. MEMBERS: Read the throne speech.

MR. SPEAKER: It's a question that the minister has discretion whether he wishes to answer.

HON. MR. HEWITT: As a member of cabinet I want to indicate to the Leader of the Opposition that statements are made which reflect on cabinet. Personal opinions, in my opinion, are not necessary to be expressed in this House. I ask him if he has ever read the throne speech; that is a statement of government.

MR. BARRETT: Thank you, Mr. Minister. You're in favour of nuclear power.

AMBULANCE SERVICES

MR. COCKE: I got so entranced with the minister's answers, Mr. Speaker, that I forgot that I had a question to ask the Minister of Health.

Interjection.

MR. COCKE: That's probably more than I could expect from this minister. I agree with you, Madam Member.

The ambulance service is a growing service which was only put in place a few years ago. In Vancouver, for example, there are 249 ambulance crews — that is 249 people for the whole Vancouver regional district. In the city of Vancouver alone there are 804 firefighters but there are many more ambulance calls than there are fire calls.

Will the minister indicate to us whether he is going to correct the shortage of ambulance personnel in this province which, incidentally, now is 200 personnel short?

[ Page 281 ]

MR. SPEAKER: If the question were couched in the language of "what has the minister done?" then it would be in order.

HON. MR. McCLELLAND: Mr. Speaker, I would hope that the member would speed up the proceedings of this House so that we could get to my estimates, because they include a fairly substantial increase for the Emergency Health Services Commission. Once we do that, then we'll be able to continue the business of the growing ambulance service in the province.

MR. COCKE: I have had the distinct privilege of reading his estimates, and I see a 5 percent increase which doesn't increase the number at all, in my view. Has the minister done anything in terms of his discussions with the Treasury Board or anyone else to increase the number of ambulance crews?

HON. MR. McCLELLAND: Mr. Speaker, the answer is yes.

SALE OF RAILCAR PLANT EQUIPMENT

MR. LEGGATT: My question is directed to the Minister of Economic Development and I think I gave him some notice of it. It concerns the sale of surplus equipment from the Squamish railcar plant of B.C. Rail. Could the minister advise whether the equipment that was declared surplus in the tender of May 15 — when it closed — was sold to any American purchasers?

HON. MR. PHILLIPS: Mr. Speaker, in an endeavour to run the British Columbia Railway on an economical basis, the tender went to the highest bidder, which was an American firm.

SOME HON. MEMBERS: Oh, oh!

HON. MR. PHILLIPS: Oh, you want to give the taxpayers' money away, do you?

Interjection.

HON. MR. PHILLIPS: How much money did they lose the last year you were president?

MR. SPEAKER: Order, please, hon. members. We are trying to protect the rights of the member for Coquitlam-Moody. Please proceed.

MR. LEGGATT: Thank you, Mr. Speaker.

Given the fact that this equipment went to an American firm, and given that the minister knows very well that there are a number of small B.C. firms which were quite desperate to keep that equipment in the province of British Columbia for specialty manufacturing, has the minister considered putting on a kind of special reserve in cases like this? Since the tender said the highest bid might not necessarily be accepted, has the minister considered giving B.C. firms a preference in this kind of bidding'?

HON. MR. PHILLIPS: Mr. Speaker, as most people understand, while we had a socialist government in the province of British Columbia inflation escalated in this province higher than in any other province in Canada, and higher than the national average. We were faced, Mr. Speaker, with that problem when we started cleaning up the mess left behind by that bungling government over there, and we almost immediately instigated a policy — through the Ministry of Finance — to change the preference for bids from British Columbia firms from 5 percent to 10 percent to try and compensate for the inflation that had been created by the socialists while they were government.

However, in answer to your question, Mr. Member, we put this out to bid in three categories. We put it out as a complete package; we put it out in six categories, grouping together certain kinds of equipment; and we put it out on an individual basis. In assessing all of the bids that came in, it worked out that the American bid was highest by $189,000. Being very concerned about the economical operation of that railway, which lost $23 million while the socialists were in charge of it — of course, as you know, Mr. Speaker, last year it made some $6 million being run on an economic basis — and having due regard for the independent board of directors, which is made up of businessmen who have put in many long hours and got the railway operating on an efficient basis, the management took this problem to the independent board of directors and a decision was made on that basis.

MR. LEGGATT: Mr. Speaker, on a point of order, I appeal to you to try to keep the minister under control. There should be, surely, some reasonable time limit given, and no political speeches given in regard to reasonable questions.

MR. SPEAKER: On that point of order — by the way, we will hold the clock for a moment, until I give an explanation — whenever a question is asked, and it is an open-ended question couched in language such as, "Has the minister considered...?" that leaves the Chair nearly powerless to control the scope of the question, although I have, on numerous occasions, warned members giving answers that the answers should not be beyond the scope of the question. Let us continue with question period.

HON. MR. PHILLIPS: On a point of order, Mr. Speaker, I just wanted to make sure that the House saw the full circle — the full answer. It was in the interests of good government that I wanted to see that they had understood the full circumstance.

MR. SPEAKER: Question period has concluded.

MR. LEA: I'd like to ask leave to move adjournment of the House for the purpose of discussing a definite matter of public importance.

MR. SPEAKER: Please state the matter briefly.

MR. LEA: Mr. Speaker, the matter is the urgency revealed in a telegram received from the Cooperative Fishermen's Guild, indicating that the Fisheries department of the government of Canada has decided not to enforce the A and B line, which is the international boundary between the Alaska panhandle and British Columbia. This means that literally thousands of pounds of fish may be lost to

[ Page 282 ]

British Columbia fisherman from our own waters due to the dereliction of the federal government in enforcing existing boundaries to protect the interests of British Columbia. This disturbing situation calls for immediate emergency discussions by the government of this province with the government of Canada to demand instructions be issued to the federal Fisheries department to enforce the international boundary by preventing American boats from fishing in British Columbia waters.

I have checked with the minister's office in Ottawa, and I've had two confirming phone calls that, indeed, the policy of the federal government is that American fish boats will be allowed to fish in Canadian waters off British Columbia and that the Fisheries department has been ordered not to do a thing about it under their agreement. I believe that this motion is in order.

MR. SPEAKER: It remains the responsibility of the Chair to determine several facets of urgency. In order to give it proper consideration, I trust it will meet with the acceptance of the House if I reserve decision for a few moments until it can be determined without prejudice to the member's position.

Orders of the Day

HON. MR. GARDOM: With leave, I move we proceed to public bills and orders.

Leave granted.

HON. MR. GARDOM: Committee on Bill 13, Mr. Speaker.

PUBLIC SCHOOLS AMENDMENT ACT, 1979

The House in committee on Bill 13; Mr. Davidson in the chair.

MR. CHAIRMAN: The member for Cowichan-Malahat (Mrs. Wallace) last evening was about to move an amendment, I believe, when we adjourned.

MRS. WALLACE: As requested by the House Leader (Hon. Mr. Gardom), I forwarded to the Clerk copies of two amendments which I had. Unfortunately they have been lumped together in Orders of the Day. While they amend the same section, section 1, they deal with separate topics. I understand that the procedure should be that I now move just one part of those and forward a copy to the Clerk.

The amendment I propose to move has to do with a situation that has developed since the agricultural land reserve was established. That land reserve has not been made a secure thing. There have been many, many areas of property removed from that agricultural land reserve, with resultant windfall profits to the people who were the owners of that property.

During the many, many days the Select Standing Committee on Agriculture sat during the last session, we heard many briefs and we had many discussions. The member for Delta (Mr. Davidson) will recall those discussions. I recall the member for Delta commenting that one of the problems was the ability to make windfall profits, that that was putting a pressure on that agricultural land, and I certainly agree with that.

This tax concession is simply going to encourage that particular aspect of developers holding land and trying to get it out of the agricultural land reserve for purposes other than agriculture, where there is a much greater monetary value for that land. Because of that, I believe that this act provides an ideal opportunity to establish some deterrent. It is with that in mind that I move the second part of the amendment which is on the order paper — it is to be added as subsection (5) to section 1: "An applicant who is successful in having land removed from the agricultural land reserve" — that is, an applicant — "shall pay to the Crown an amount equal to the benefit accrued under this Act by either the applicant or the owner for a period not in excess of ten years immediately prior to the removal of such land from the agricultural land reserve."

MR. CHAIRMAN: Hon. member, your amendment is out of order under standing order 67.

MRS. WALLACE: On what grounds is that, Mr. Chairman?

MR. CHAIRMAN: It imposes an impost.

MRS. WALLACE: No, it doesn't impose an impost.

MR. CHAIRMAN: There is only one member standing; please wait until you're recognized.

MR. NICOLSON: On a point of order, had the motion been moved in its entirety as it sits on the order paper, it would have perhaps imposed an impost. But the member has submitted a motion which only contains, I believe, the second paragraph, which says that the applicant shall pay to the Crown; that is not an impost against the Crown.

MR. CHAIRMAN: That is in fact an impost. It's not a question of whether it is against the Crown. It is an impost and that makes the amendment out of order. If you read standing order 67, it says: "It shall not be lawful for the House to adopt or pass any vote, resolution, address or bill for the appropriation of any part of the public revenue, or of any tax or impost...."

MR. NICOLSON: Appropriation of revenue or appropriation of tax or appropriation of impost....

MR. CHAIRMAN: It's a separate part of the section, hon. member.

MR. NICOLSON: Well, Mr. Chairman, I would hope that you would reserve your decision.

MR. CHAIRMAN: The option of the member is to challenge the Chair.

MR. NICOLSON: Well, if we challenge the Chair, then we'd have a new rule in the House, and I'd prefer not to do that.

MR. CHAIRMAN: This is not a change of the rules of the House. If you wish to challenge the Chair, that is fine;

[ Page 283 ]

otherwise the ruling of the Chair is that this particular amendment is out of order.

MRS. WALLACE: I regret your decision, Mr. Chairman. In connection with section 11 think the government is remiss in leaving the door open to this kind of handout to developers. They will now be able to afford to hold land for longer periods of time and continue their attempt to put pressure on the agricultural land reserve to have that land removed. There are a great many people in this province who are more concerned with their own profit than they are concerned with the conservation of agricultural land. I'm concerned that this act simply makes it much easier for them.

We're talking about a fair sum of money here; we're talking about cutting in half the school taxes, which can range.... My tax notice for my area is something like 92-plus mills. We're talking about almost 10 cents on the dollar. If you have a $100,000 estate — and it doesn't take much land to come up with that — you're talking about a fair handout to developers. I'm concerned, Mr. Chairman, that this bill makes no attempt to correct that, and I'm shocked that the government benches would not.... If the amendment is out of order, I urge the government to include this amendment from the government side.

While it may well be out of order, I still intend to move the second part of the amendment which is on the order paper. The minister has said it is nothing; that it's not going to amount to peanuts; that it isn't going to affect the assessment rolls; that it isn't going to affect income. If it isn't going to cost the school districts anything, and if it isn't going to reduce the income of regional hospital districts, then certainly it isn't going to be an expense for this government to reimburse those school districts and hospital districts for the reduction in their income. The minister stood in this House and said that it isn't going to affect those school districts.

I move this amendment, even though it talks about revenue. The minister has said that it isn’t going to be any amount of money at all, it isn't going to amount to any change to school districts or to regional districts. If what he says is true, it isn't going to affect the dollars out of the Crown either. I move, Mr. Chairman, that any loss of revenue to school districts and our regional hospital districts, by reason of this section, shall be refunded to those bodies from the general revenue of the province.

MR. CHAIRMAN: Hon. member, I'm sure you're aware that the amendment is out of order because it violates standing order 66, in refunding general revenue of the province to those bodies. It leaves it wide open; that's an impost on the Crown.

MRS. WALLACE: Mr. Chairman, I was sure that would be your ruling. I had hoped it would be otherwise on the first amendment.

The minister says there isn't going to be any cost. That's what he told us yesterday — that it wasn't going to reduce the income of those school districts. If that is the case, then there's going to be no dollars involved in this one.

MR. CHAIRMAN: Hon. member, the minister can accept it or it can come in by message, but it cannot be accepted by the Chair in the order it was presented.

MRS. WALLACE: Mr. Chairman, I have attempted to have three amendments added to section 1 which would have indicated to our party and to the public of the province that this government's intentions were not just simply to help the developers and the foreign owners. Their intentions are to help anyone, really, except the farmers. We have no choice except to vote against this section.

MR. COCKE: The minister said yesterday that he wanted a little time to think things over. Now that he's got some amendments — he had one yesterday on foreign-controlled land and now he has another one today — it strikes me that the minister could stand up now and say: "Yes, we'll put these amendments forward on behalf of the government." The minister can do that, while you rule the opposition can't. Let the minister stand up and indicate to us that he's prepared to amend the section himself, because it was very poorly thought out in the first place, Mr. Chairman.

HON. MR. McGEER: On the contrary, the bill before this House was very carefully thought out, and while the member for Cowichan-Malahat has made some interesting points and while I've certainly given an undertaking to study those, it was that very member, Mr. Chairman, before she began introducing all of these complicated amendments, who stood before the House and said it was going to be an administrative nightmare. Now you can't have it both ways. What you're attempting to do with all of these amendments is to introduce something that would be an administrative nightmare.

One thing you have to do about taxes, notwithstanding.... I didn't want to interfere with the debate yesterday. It was so entertaining. It would have spoiled it to introduce some logic. The member for Alberni (Mr. Skelly) yesterday was pleading with us for more time; he wanted information before he was able to undertake any kind of vote or consideration. When we said we would answer any specific questions that he had, it turned out that he didn't have any specific questions, but he felt that if we gave him reams of information he might be able to think of some. Yet he was quite prepared to vote for an amendment introduced by the member for Cowichan-Malahat (Mrs. Wallace) brought forward so hastily it wasn't even signed before it went up to the Chair; no time to put it on the order paper, so he didn't need to think over that. But when it came down, something that had been carefully prepared where we did have documented answers to any specific questions that he would have, then he wanted more time because he couldn't think of any questions to ask on the basis of all the information he was being given.

Mr. Chairman, we're not going to rush in like fools, the way the NDP did when they were in power. If you've got suggestions here — and you've made them — we'll undertake to study them and consider them carefully. But we're not going to walk into an administrative nightmare. We're not going to follow Brave Dave into the tax jungles; they're just a little bit too dangerous. He did that when he was in government, but he didn't learn his lesson then. He urges all of you to follow when you're in opposition, to do the same sort of things with your amendments, and I would just advise you, as a party, to give careful consideration to the things you bring forward, because taxation particularly has all kinds of complicated ramifications. The opposition

[ Page 284 ]

has got to understand that there are administrative problems with any tax. The tax jungles are dangerous terrain, because it's quite easy to introduce tit-for-tat, and you've got to be pretty careful what you do.

But we'll give consideration to these proposals, all of them, and perhaps some of them, next year at some future time, might be enacted into legislation. I'm well aware that one of the amendments was quite close to one of the recommendations made by the agricultural committee when it toured British Columbia. So the answer is yes, we'll think about them. But it really wouldn't be wise, quite seriously, to rush in and accept some of these so quickly.

MR. COCKE: I just love to hear the minister standing up and proclaiming his virtue. The fact of the matter is that we see the midnight oil being burnt during a session in the Cedar Room and the Maple Room where the cabinet committee on legislation are working up to the last minute on everything. Talk about a smokescreen, Mr. Chairman! I can't believe it. They don't prepare their legislation before we get in here, and that's the unsatisfactory part of the whole situation.

MR. SKELLY: Mr. Chairman, I'm surprised at the minister for criticizing me for asking for detailed information about a statute. Surely, if we are to have any kind of cooperation at all in this House on the basis of informed legislators, one of the minimal things that the government can do — and it is done in many other jurisdictions — is to present information in the form of explanatory notes about legislation in much more detail than we have them presented to us here. It simply doesn't make sense for legislators on either side of the House to pass legislation without that information in front of them. And I mean in front of them, so that they can check the details, school board by school board, throughout the province.

Now the minister expects me to take at face value statements he makes across the House about what effect it's going to have on certain specific school districts. Well, I've never been able to take that minister's statements at face value, Mr. Chairman. That's why we would like to have the information in front of us, so that we can check it with the school districts and with the local governments involved.

Now the first amendment, which the member for Cowichan-Malahat (Mrs. Wallace) mentioned, obliges a person who takes land out of the agricultural land reserve on his own initiative to pay back-taxes at the full rate. That is not an unusual procedure. I believe that under section 328 (a) of the Municipal Act arrangements are made between municipalities and the owners of golf courses and cemeteries for a tax or assessment exemption; and if that land is taken out of that use, then they must pay the back-taxes on it.

So I don't think there's any administrative nightmare involved, Mr. Chairman. It's something that could easily be developed by the minister, given a few days to read the statutes and to consult his staff. Perhaps the minister would agree to take this statute back to his staff, take a look at it, and bring it back to the House at a later date with full information, at which time I'm sure he would find this opposition most cooperative.

MR. RITCHIE: First of all, Mr. Speaker, I would like to say that there could be some merit to the proposed amendments, but I would like to tell the House that from my experience, before we start adding any more problems to the agricultural land reserve, and before we start applying any more legislation such as was applied whenever the Act came in in the first place, what is required first is a major fine-tuning job on the agricultural land reserve. I would say that before we start adding any more costly exercises we should make sure that we are removing land presently in the reserve that doesn't really belong there.

So I would have to be opposed to these proposed amendments only because we would be trying to correct something that it is really not possible to correct in this way. It's something that is only going to add extra cost and confusion to the whole situation we have concerning our agricultural lands.

MRS. WALLACE: Mr. Chairman, the minister in his response spoke about the bureaucratic problems that are involved with this act. Let me tell you that the amendments which I have moved would not have the effect of making that a greater bureaucratic nightmare. The problem, Mr. Minister, is in the classification of farmland. You and your government have not come up with an answer to that situation — that's where the bureaucratic nightmare is. When you add trying to calculate something that you have no rules for, and then relating it to a portion of a farm, some of which is in the ALR and some of which is not, then you have a bureaucratic nightmare. I doubt you're going to solve it by 1980, or even 1985.

Section 1 approved on the following division:

YEAS — 28

NAYS — 19

MR. COCKE: On a point of order, when the names were read one of the members was not in his seat. It was very difficult to check the name Waterland. I looked over and there was no Waterland sitting in his seat.

MR. CHAIRMAN: The point of order is well taken, and I would ask that all members assist the Chair and the Clerks, when they are asked to return to their seats when divisions are called, by remaining there until such time as not only the division but also the reading of the list has taken place.

[ Page 285 ]

Sections 2 to 4 inclusive approved.

Title approved.

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

Motion approved.

The House resumed; Mr. Speaker in the chair.

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

Bill 13, Public Schools Amendment Act, 1979, reported complete without amendment, read a third time and passed.

HON. MR. GARDOM: Second reading of Bill 11. Mr. Speaker.

BRITISH COLUMBIA HYDRO
AND POWER AUTHORITY (1964)
AMENDMENT ACT, 1979

HON. MR. WOLFE: Mr. Speaker, as the members are well aware, the sole purpose of this bill is to increase the borrowing authorization of the British Columbia Hydro and Power Authority from $4.9 billion to $5.65 billion, an increase of $750 million. This will allow the Authority to borrow the necessary funds to meet its requirements for capital construction costs in the coming year.

The major projects involved, and the estimated costs for 1979-80 year are:

First of all, the Revelstoke project, to cover continuing engineering, design and construction of a dam and generating station on the Columbia River, for service by June 1984. The amount budgeted for this project in 1979-80 is $167 million.

Secondly, Mr. Speaker, the Seven Mile project, to cover continuing engineering, design and construction of a dam and generating station on the Pend-d'Oreille River, with related substation and transmission facilities, for service by October 1980. On this project $115 million is expected to be spent in the year 1979-80 on this project.

Thirdly, the Peace Canyon project: to continue engineering, design and construction of a dam and generating station on the Peace River, with related substation and transmission facilities, for service by September 1980. The work is budgeted for $114 million in 1979-80.

Fourthly, the G.M. Shrum Generating Station: to complete the installation of the tenth unit at the G.M. Shrum Generating Station, for service by February 1980. The final unit is estimated to cost $15 million in 1979-80.

Fifthly, the Peace Site C development studies: to continue environmental studies and engineering in preparation for a water licence; to maintain a possible 1986 in-service date for a proposed hydro generating station on the Peace River. On this project $13 million is expected to be spent in 1979-80.

Sixthly, for the Hat Creek developmental studies: to continue line feasibility studies and powerhouse optimization studies for a thermal generating plant, as a viable option for 1989, at a cost of $8 million for 1979-80.

Seventhly, for the Vancouver Island 500 kilovolt transmission system: to continue construction of a 500 kilovolt transmission system, including substation and microwave facilities for service in 1981. This project is budgeted at $25 million for the 1979-80 fiscal year.

For the mainland–Vancouver Island 500 kilovolt transmission interconnection to continue engineering, route survey, right-of-way acquisition and clearing for a 500 kilovolt transmission interconnection to Vancouver Island for service by 1983, the cost will be $20 million by 1983.

Mr. Speaker, $20 million is to be spent on this project in the 1979-80 fiscal year. As I conclude these remarks I will be sending across to the member for Alberni a complete rundown on this detail.

Next under the headline "Other Generation," including other major project developmental studies, to continue environmental engineering and developmental studies to determine feasibility of various proposed generating projects, and also provide for various additions and improvements on other generating facilities, the budget is $26 million for 1979-80.

For other transmission work, for construction on other transmission lines, to provide facilities to transmit energy at high voltage from generating stations to transformation stations, $43 million has been budgeted for 1979-80.

For other transformation — that is, construction of other transformation plants and substations needed for switching, termination and the protection and control of electrical energy during the transformation to distribution voltage — the budget is $52 million for the year 1979-80.

Under the heading "Distribution Systems," improvements and extensions to the electric distribution system which is below 60 kilovolts to serve additional customers, the budget is $87 million in the year 1979-80.

For other electric, which includes service buildings, control centres, research laboratory, vehicles, tools and equipment, the budget is $62 million for the year 1979-80.

Under the heading "Gas Service," you have distribution systems. For this, and to provide for the recurring cost of improving and expanding the gas distribution system and other facilities, and additions needed to provide gas service to customers, including an amount of $8 million to continue the exploration program for an underground reservoir, the budget is $40 million for 1979-80.

Under the heading "Transportation Service," for improvements and additions to transit facilities required for the operation and maintenance of the transit fleet, there is a budget of $7 million during 1979-80.

Under the heading "Rail Freight Service," for improvements to rail freight plant required for operation and maintenance of the service, we have an estimated cost of $3 million in the year 1979-80.

Mr. Speaker, all these capital projects total $797 million. Of the borrowing picture of B.C. Hydro, $274 million of the present borrowing authority still remains. This amount, plus the $750 million proposed in this bill, will enable the British Columbia Hydro and Power Authority to proceed with these projects, and still leave about $200 million borrowing authority available for unforeseen events.

I should say it is considered most opportune and economic to have a borrowing latitude ahead rather than to be borrowed up to the extreme limit of any authority which a large enterprise like this has. It gives them flexibility in

[ Page 286 ]

picking the proper moment when they may wish to go to markets, or otherwise, when the interest rates are most appropriate. I'm stating that as a case simply for having some increased latitude, or borrowing ahead, in policy for that corporation.

I might say that I should remind members, Mr. Speaker, that, notwithstanding this authority to borrow being provided by the Legislature, any individual borrowing requires approval of the provincial government, or the cabinet through order-in-council, whether it is an internal borrowing or an external borrowing. In other words, you can feel safe in saying that this corporation will only be borrowing against this increased authority as is really necessary.

I'll provide the members with the details I've just given and I'd be pleased to hear their comments. Mr. Speaker, I move second reading.

MR. SKELLY: Mr. Speaker, traditionally, over the past decades in this Legislature, the opposition party has taken a look at this bill which is designed to extend the borrowing authority of B.C. Hydro, and traditionally, except for the last three years, they have supported the bill.

We accept the need, as stated by the Minister of Finance, to provide some advance authority for borrowing for a company such as B.C. Hydro, so that it won't be caught short and have to call a session of the Legislature in order to provide itself with borrowing authority.

We don't derive any comfort from the fact that individual borrowings have to be approved by cabinet, because cabinet appears to have approved, in the past, anything that Hydro has asked for, without seemingly giving much thought to a total, comprehensive energy policy for this province. Time after time, year after year, over the past three years, we've asked the members of the government opposite: "When are you going to produce a comprehensive energy policy for the province of British Columbia?" We've got answers, and half answers, and half promises and promises, but they've never delivered on a comprehensive policy. In the meantime, Mr. Speaker, Hydro seems to be getting more and more into the glue. More and more horror stories come out about potential brownouts and curtailment of industrial expansion because of the fact that Hydro is unable to provide the power needed for the growth of industry in British Columbia.

This time again we simply cannot support an increase in the borrowing authority of B.C. Hydro without justifying that increase in some kind of comprehensive energy policy document issuing from that government. Hydro appears to know where they are going; they're going in the direction of nuclear power for the province of B.C. Hydro appears to know where they are going, but the government seems to be waffling and wavering all over the ballpark. They know where Hydro is going. They know it is politically unsuitable to their needs that Hydro is making these statements, but we still do not have any comprehensive energy policy issuing from that government over there.

Mr. Speaker, this borrowing authority for $750 million represents about one-sixth of the value of the total budget of the province of British Columbia in this fiscal year, a budget that is laid out in estimates in hundreds, almost thousands, of pages that we can go through section by section and analyse to find out just what the government is doing, and criticize it when we find it to be wrong and support it when we find it to be right.

In the case of Hydro, we're asked to give a rubber stamp to $750 million in borrowing authority on the basis of two lines in a piece of legislation. We have no opportunity to question Hydro as to the details of their projects, as to the details of their policies and their plans for expansion. We have no opportunity to question Hydro on the basis of its projection of future energy requirements for the province. We simply do not have a correct base on which to responsibly vote Hydro, which is not responsible to this Legislature, $750 million in debt-creation authority.

I do appreciate the facts, by the way, Mr. Speaker, that the minister does prepare. I don't seem to have it this time, but last time I received a three-page document outlining some of the projects that Hydro intended to follow this year. This year we've gone up to four pages, and yet we have hundreds of pages in estimates, as well as the throne speech, outlining in some detail and giving some idea of what the government's policy and what the government's main thrusts are for the year. From Hydro we get nothing at all, except the odd statement by Robert Bonner saying that Hydro is going in the direction of nuclear power. We on this side of the House cannot accept that, Mr. Speaker.

Interjection.

MR. SKELLY: He said nuclear power is inevitable.

MR. KEMPF: I was there yesterday; I heard his speech.

MR. SKELLY: You should have stayed over there. Nuclear power, he said, was inevitable for the province of British Columbia.

It's also of some concern to us, Mr. Speaker, when we examine the reports of Crown corporations committee, especially the report of the gentleman who has just left his seat here, on the performance of Hydro in the past in completing their obligations in building large generation and transmission projects. I'd just like to read a section of page 76 of the Crown corporations committee's report on B.C. Hydro:

"If there is one point on which the committee is not only unanimous but adamant, it is the following: that construction projects now being undertaken by Hydro — projects which during the course of the next five years or less will, in effect, double the size of the authority — must be carried out in a very different manner than that which the committee observed during the inquiry."

We've had no indication, Mr. Speaker, from B.C. Hydro or from the government that any changes have taken place in the management of B.C. Hydro, other than rumours of sacking Robert Bonner, and no indication that the way in which Hydro is going to carry out these projects has changed at all. In fact, the stories coming out of the Revelstoke Dam construction project indicate that Hydro is wasting even more money and blowing even more money on that construction project because of inadequate pre-engineering and inadequate management.

I'I continue with the quote from the Crown corporations committee's report:

"The potential consequences of Hydro implementing currently conceived projects in the same manner as those which were the subject of this inquiry is of utmost concern, as it carries with it the

[ Page 287 ]

risk of debasing the financial credibility of this province."

If there is one thing we're concerned about on this side of the House, Mr. Speaker, it's that government debasing the financial credibility of this province by continuing to rubber-stamp allocations to B.C. Hydro in the form of borrowing authority equal to one-sixth of the value of the total provincial budget. All you're asking us for is one yes or one no. There's no detailed examination of what Hydro is intending to do with this money that's going to be guaranteed by the taxpayers and by the ratepayers of this province.

Mr. Speaker, one of the problems is the fact that Hydro is a large, centralized, secretive kind of bureaucracy. Nobody who has any access to the organization can get out of Hydro the actual facts of what's going on. It's difficult to get the facts on which they base their pricing structure; it's difficult to get the facts on which they base their engineering and pre-engineering for power projects; it's difficult to get the facts on which they base their need for various types of generating and transmission systems. Even the Premier has stated that Hydro — as far as he can see — is out of control. He stammers and mutters around saying: "I don't know what I'm going to do about Hydro; it really appears to be out of control." And he does nothing.

One of the things he could do would be to generate a comprehensive energy policy for this province or instruct his Minister of Energy, Mines and Petroleum Resources (Hon. Mr. Hewitt) to do so. But his Minister of Energy, Mines and Petroleum Resources seems to have the same problem — he's wandering around in the dark without a policy and no seeming inclination to develop one.

What Hydro really needs, Mr. Speaker, is a legislative watchdog that can take this bill and analyse it; call representatives of B.C. Hydro before the committee; call representatives of the Energy Commission before that committee; call energy users in the province before the committee; and call public opinion groups before the committee to see what Hydro really needs and how Hydro's call energy use management should really be changed in order to meet the energy needs of this province. At the moment Hydro seems incapable of doing it, and incapable of justifying itself to the people of this province.

I'd like to say a few words about the question of projected demand, which Hydro uses to justify a number of these projects which were issued to us by the Minister of Finance. The basis of Hydro's energy-requirement projections has been attacked by a number of authorities throughout British Columbia, including a representative of the B.C. Energy Commission. And I'd like to quote from a periodical called Relay, which is put out by the Electrical Contractors' Association of British Columbia. On page 9 it compares the B.C. Energy Commission projections for energy demand with the means that Hydro uses to develop its projections:

"Evans said that the two organizations appear to arrive at their figures in different ways. Hydro's latest forecast of 5.5 percent demand growth is based, he felt, on what customers think might be the maximum required. I think in some cases industry will throw in everything they might possibly require over the next ten years in order inflate possible energy requirements. On the other hand, the B.C. Energy Commission derives its figures from a detailed econometric study which takes into account such factors as growth in population and households. Our forecasts reflect fewer population and, accordingly, fewer household increases simply because fewer people are entering the province and fewer people are having children."

So Hydro does a slapdash kind of guessing as to what energy projections are going to be, whereas the B.C. Energy Commission uses, according to their terms, "detailed econometric analyses." Who are we to believe? We know that Hydro is attempting to build a huge electrical generating and transmission empire throughout the province of British Columbia in order to justify their own estimates, which even Energy Commission denies are accurate. There are some real problems here.

The Crown corporation committee suggested, among other things, that Hydro is too large and too unwieldy at the present time. This creates mismanagement problems. It creates wastage. In order to avoid this waste and mismanagement, they suggested that Hydro be broken up into a number of operating subsidies. I'd like to read from the findings and conclusions of the Committee on Crown Corporations:

"For the future, in order to strengthen Hydro, the committee thinks that consideration should be give to a possible restructuring of the B.C. Hydro and Power Authority. Some major organizational changes are already underway, notably the transfer of passenger transportation to the Urban Transit Authority, and possibly the removal of the British Columbia Electric Railway. Perhaps it would be appropriate and desirable to carry this reorganization through to a greater extent. One way this could be done is by dividing existing Hydro operations on a functional basis into several autonomous subsidiary companies with responsibility along the following lines: construction, electrical sales, gas distribution, administrative services. Done in this way, B.C. Hydro, as we now know it, would remain as a non-operating holding company and financial agent."

I suggested this to the previous Minister of Energy some time ago, when he refused to answer my letter to the Premier, who also refused to answer the letter in any decent way. I suggested that as a result of what was taking place around the Site C dam, where B.C. Hydro was attempting to eliminate opposition to the granting of a water licence by buying up properties that would be affected by the dam, Hydro was attempting to eliminate opposition to the application and granting of a water licence for the Site C dam by buying up the opposition.

I recommended to the government that what they should do is separate the planning authority in B.C. Hydro and assign that authority to the B.C. Energy Commission, leaving Hydro as simply an operating company which carries out the power requirement goals established by the province of British Columbia through the Energy Commission. That is the way Hydro should be separated in order to prevent the kind of abuses that were taking place around the Site C dam. Of course, the minister refused to get involved in that.

I suspect there is some kind of a relationship between the chairman of B.C. Hydro and Power Authority and the Premier, where the Premier is reluctant to issue orders to

[ Page 288 ]

Mr. Bonner because of some service as a bagman that Mr. Bonner may have performed for the Premier in the past.

There have been other criticisms from informed and educated people throughout this province about the way B.C. Hydro develops its energy demand projection in order to justify the huge construction program they have in the province.

I think that one of my colleagues will be speaking further on Bonner's proposal for a presentation to the National Energy Board on firm energy exports to the United States. We know that Bonner is proposing this out of his allegiance to the Canadian Nuclear Association, which has been asking member utilities to develop firm energy exports to the United States in order to accelerate the nuclear reactor construction program throughout Canada. The report that was recently done for the Canadian Nuclear Association showed that if they don't accelerate the construction of nuclear reactors, then those industries involved in the nuclear business are going to be going out of business because of drying-up exports and lack of demand for their products and services in Canada. So Bonner is advocating firm power exports to the United States more out of allegiance to the Canadian Nuclear Association than out of allegiance to this province and its own power and energy requirements.

To sum up, the reasons we have to oppose this bill are not that we would like to see some of these projects stopped, projects such as the Seven Mile Dam, which is already underway, and the Peace Canyon dam, which is already under construction, or the installation of additional generating facilities at G.M. Shrum; all of those things we recognize are ongoing projects that have to be continued and should be continued.

[Mr. Davidson in the chair.]

What we are concerned about is Hydro's plans for the future and their studies for the future — on Site C, for example, and on the Cheekye-Dunsmuir project. It's not one or the other, Mr. Minister of Energy. If you are confused by that notion, then possibly you should expand your lines of communication and talk to people who know a little more about energy than you do. It's not one thing or the other, but in Hydro's terms, it's either massive generation projects, massive transmission projects or nothing at all. Bonner talks about "the big-ticket answer" and all he can see is the big-ticket answer. He can't see that there are other options: soft energy path options and intermediate technology options. Bonner can't see it because Bonner is connected with the Canadian Nuclear Association, and Hydro is tied to an old style of public utility management that is now going out along with the dinosaurs.

Mr. Speaker, Hydro could do a number of things to change the way energy is produced and transmitted in this province. They could encourage cogeneration, and encourage the use of waste energy by changing their pricing systems. Or they could do it by spending some of this $750 million that we're being asked to vote on lower on intermediate technology systems which Hydro seems reluctant to look into. Hydro pays little attention to those solutions.

The Minister of Energy boasts that he's just signed an agreement with the federal government to the tune of $27 million, $13.5 million of which will be provided by the British Columbia government and the balance by the federal government. But it is to be spent over a long period — five years — so maybe $6 million a year will be going into alternative technologies and demonstration projects and that kind of thing. Six million dollars a year, and it says in the agreement: "provided the Legislature votes for it."

Well, this year and last year and the year before we've been asked to vote in the range of a billion dollars a year, or half a billion dollars a year, to B.C. Hydro to continue along the old conventional energy path which just leads to more and more expenditures, to more and more debt. And all we're spending on other technologies is $6 million a year.

So it just isn't satisfactory to this caucus. No attempt on the part of this government to....

Interjection.

MR. SKELLY: You're in government now, Mr. Member. Whether you choose to exercise it or not — and it's pretty clear that you haven't — you have the responsibility to develop a comprehensive energy policy for the province of British Columbia.

Mr. Speaker, I do give some credit to Hydro for the ways they have looked into alternative technologies, the way they have examined the problem of waste — and we're one of the most wasteful users of energy on the globe. I commend their thermography programs, where they've examined energy leakage from homes and from institutional buildings throughout the province; their advertising programs encouraging conservation of energy; and their insulation loans. But much more has to be done to encourage energy savings, and in fact, since energy savings is equivalent to energy production, much more has to be done to encourage that form of energy production than to continue to build new generating transmission plants or new generating plants and transmission facilities.

It appears that nothing has changed in the government's attitude since last year. Nothing appears to have changed in Hydro's attitude since last year. I can't see any reason why the New Democratic Party opposition should support this bill.

I do recommend that the minister consider placing this bill into a committee where we can examine it in detail, examine Hydro's capital requirements in detail, and summon before that committee members of B.C. Hydro's staff and members of the public in order to justify borrowing an additional $750 million. I can't see that we can support this bill until the government agrees to do that.

MR. DAVIS: Mr. Speaker, I support this bill. I support it basically because I believe the B.C. Hydro and Power Authority is on the right track. It's developing energy resources which are internal to British Columbia. It's also placing the accent on renewability, not nuclear power, as the opposition would have us believe, but on hydroelectric power and to a much lesser extent on natural gas. It's borrowing and spending this money for the generation, transportation and distribution of water power. Water power is regarded in many countries now — certainly by the academics who write about energy — as perhaps the most effective way of collecting solar energy. Solar power is renewable in the ultimate sense, and its power base is the sun. It is power that will be there for as long as we keep the

[ Page 289 ]

dams and the transmission lines in good working order.

Eighty-five percent of these moneys will go towards the development of hydro resources in this province. Most of the remainder will go into the construction of pipeline systems for the distribution of natural gas. We've lots of natural gas in this province, at least adequate supplies for our own use, We've enough to last us well into the next century. If and when shortages develop, we'll have the facilities, the pipelines and distribution systems, to distribute high-energy gas produced from coal. In other words, not only is the money going into hydroelectric power development, but also the money is going into gas-system development in this province. We'll see the effective use for decades to come — 50 years, even 100 years. They will be used for the efficient movement of energy resources which are essentially renewable resources. They are British Columbia resources, not resources which have to be imported.

An oil shortage is developing; it's developing worldwide. It now exists in places on this continent. Canada is a big importer of foreign oil and unless we manage our affairs better, we will become a larger importer. The world price of oil is rising. It will continue to rise in the 1980s and 1990s. This is another reason why we must continue to invest in our own resources. Hydroelectric resources, natural gas and coal resources are here in the province. Only in this way are we likely to develop a reliable, secure, energy supplying system for the people of British Columbia.

Conservation, as everyone stresses, is very important. Energy saved is a very valuable resource in itself, and every attempt must be made to conserve energy. This doesn't remove the necessity of developing our own energy resources, at least to replace those which we would otherwise have to import from other parts of Canada, and perhaps even from the rest of the world. We can cut back on our own energy use; this is particularly true of oil. We must do our utmost to move from an oil-based economy, where the supply and cost of petroleum products are under foreign influence, to an electrical energy– and gas-based economy where supply and cost, as much as possible, are under provincial control. In the long run we'll have to rely essentially on hydroelectric power and coal. In the medium term, however, we can use natural gas as a bridge. Natural gas can help us adjust from our present oil-based economy — at least 50 percent economy — to one which is much more stable from a supply and price point of view.

British Columbia's goal by 1990, in my opinion at least, should be to reduce our oil consumption from 50 percent to say 30 percent of our total energy use. This can be accomplished by increasing natural gas and electricity shares from 20 percent each to 30 percent each. This will cost money; it will cost more than $10 billion over the next decade. This is a very large sum indeed, and members of this Legislature certainly must be concerned about the way in which it is spent and the efficiency with which it is spent. This request for $750 million in the current year is part of this requirement. It's an annual payment; it's one of the many instalments which we shall have to meet in order to make ourselves more self-sufficient in energy.

Over the past decade our electricity and gas prices have risen in British Columbia, but they haven't risen anything like the delivered price of energy in other parts of Canada and the United States. They've risen much more slowly than energy prices in western Europe and Japan, so our competitive position, at least in terms of energy cost, has improved. It will continue to improve, especially if we place our reliance on hydro power and coal and continue to develop our resources in the relatively efficient manner which we have developed them in the recent past.

The request today before this House in Bill 11 is for $750 million. Averaged out over the projects which are currently under development, this works out to around $1,000 per kilowatt. In effect, we are raising a mortgage, and that mortgage is against dams, transmission lines, distribution systems which will serve us for many, many years to come. We freeze the costs of these facilities as we build them, and in the long term this kind of development tends, relatively, to be insulated against inflation. We tend to fix our future cost of power now and this gives us an advantage in the long-term future.

The projects which the hon. Minister of Finance outlined and which were priced — at least for this year — in his submission roughly double our ability to produce power in this province. The peak requirement so far has been of the order of five million kilowatts, reached this last January. The new facilities currently under construction will approximately double that ability to produce power, and if the forecasts of the Energy Commission, B.C. Hydro and others are borne out, this capability, which is currently under construction, will last us until the late 1980s. It will last us for another decade. So we are really not talking about other sources of power — other, that is, than the dams under construction on the Pend-d'Oreille, at Revelstoke on the Columbia, and on the Peace River. We certainly are not talking about nuclear energy; we're not talking even about power generated on northern rivers like the Liard, or energy from Hat Creek, or coal in the East Kootenays.

B.C. Hydro has produced a publication called Power Perspectives 1979, and I believe this was distributed to all the members of the Legislative Assembly. It lists the projects which are being considered for the long term; that is, for the 1990s at least to the year 2000. That would double our capability again, not only from five million kilowatts, which we have presently, to ten million, which we will have when the projects presently underway are completed, but to 20 million kilowatts and that, essentially, is using conventional sources of power, substantially hydroelectric sources of energy — solar energy in the old-fashioned sense. So there is really no room in the next 20 years for a nuclear power plant, even if the cost of nuclear power were in any way competitive with these resources which we have in the province, resources of a traditional kind.

The question if nuclear power isn't one which we will have to face. It shouldn't be one for political difference between the two sides of this House. It is basically irrelevant in British Columbia. It shouldn't, basically, be a matter for political dispute between parties. It isn't relevant because it isn't economic. Certainly it isn't economic in British Columbia. References have been made quite rightly to other sources of energy, other sources of electricity, the combustion of wood wastes or garbage — co-generation as it is called. There have been a number of studies done in the province and there are applications certainly at pulp mills and possibly at sawmills. Not only can this waste wood be used to generate heat and make steam for process purposes, but surplus energy can be used to produce electricity. That electricity in amount is significant but not large. The studies so far indicate that 1, 2 or 3 percent of our power

[ Page 290 ]

requirements could be supplied from co-generation by burning wood wastes at our pulp and paper mills and our sawmills. It is not 5 percent and it is not 10 percent. It is significant; it is important. B.C. Hydro should cooperate with industry in this respect. But it is not a major solution, at least in the short run. It would look after a few months of load growth in this province, but it wouldn't look after a year's growth; it wouldn't look after a decade's growth. There are longer-term possibilities, but the economics aren't there for co-generation to make a major contribution to our power needs in British Columbia, at least in the 1980s.

We need to change some legislation in this regard. Any company, any corporation, indeed any individual, in this province, that sells more than 15 percent of their output of electricity automatically becomes a public utility. They are subject to the scrutiny of the British Columbia Energy Commission, for example. In order to encourage industry to generate electricity from waste heat, we should remove that clause from the B.C. Energy Act. Industry should be able to sell that surplus energy to anyone, other than for export, and that should be subject to some scrutiny. And that anyone would include the public utilities: B.C. Hydro, West Kootenay Power — a municipal government if it wishes to set up its own generating and distribution facilities. And they would be subject to public scrutiny. But the industry supplying the energy should not automatically become a public utility under our legislation. This sets a serious limit on capital available for co-generation in British Columbia, and I think that restriction should be removed.

We've lots of coal. We have probably one of the finest coal deposits for power generation anywhere in the world at Hat Creek. We've got a lot of waste coal left in the Kootenays, stockpiled as a result of the export of the higher-quality metallurgical coal, principally to Japan. I believe that we should, at least shortly, be generating some electricity and using that waste coal at the very least to help solve the local environmental problem. In the medium term we could export that energy; in the long term we could also feed it into our own power grid for our own purposes.

Vancouver Island has a power problem; it has an energy problem. Vancouver Island is the only part of British Columbia that is not supplied with natural gas. British Columbia therefore is the only part of British Columbia that isn't subsidized by the relatively low internal price of natural gas in this province. Natural gas on world markets is worth twice what it's being sold for here in British Columbia. I believe that that opportunity should be made available to the residents of Vancouver Island as a matter of broad policy. I believe it should be made available for several other reasons. It's much cheaper, generally speaking, to make gas available for heating, including the space heating of homes, than it is to space-heat with electricity — perhaps half as expensive. We're wasting a lot of resources if we're going to heat our homes, stores, offices, schools and hospitals with electricity in this province when natural gas could do the job as well and synthetic gas and coal ultimately do the same job through the same facilities.

Now it may not be economic in the private enterprise sense to bring natural gas to Vancouver Island, and some interim arrangements may have to be made because our big forest products industries on the island by and large are self-sufficient in respect to heat energy because they are using wood wastes more and more. But in the long run I believe a pipeline to Vancouver Island will be economic and is economic, even if a major transmission powerline link is also built to this island.

I believe the powerline link — at least the first link — is needed for a number of reasons. There is very little hydro capacity left on Vancouver Island. The coal at Comox is expensive to mine and very high in sulphur. Given the new environmental protection guidelines which are being developed for thermal plants in British Columbia, it's very doubtful whether a power plant burning that coal would ever be economic. Those guidelines are very strict; they're the strictest anywhere in the world, to my knowledge. They will add substantially to the cost of coal-based power in British Columbia and I think we should look at them very carefully for that reason.

Finally, this bill asks for $750 million, as I say — just one year's instalment as part of a much longer determined program for the province. It's true that $750 million is a lot of money, but relating B.C. Hydro's investments to the gross provincial product, they are of the same order of magnitude as requests in other years. Those requirements of B.C. Hydro for investment in new power dams, transmission lines and the distribution of both electricity and gas have been of the order of 4 percent or 5 percent of our gross national product, and that's still the case with respect to this request this year for $750 million.

I believe that members of this Legislature should be vitally interested in how much money is being spent for what purposes by B.C. Hydro and how well it's being spent, and I think they can express that concern and get answers — hopefully all the answers — to their questions, not only during the discussion of this bill but in the Committee on Crown Corporations.

It's very important that they discuss rising costs and the prospects of rising power and gas rates, even though costs elsewhere in the world are going to be going up even more rapidly. I think they should be satisfied in respect to this question of nuclear power, which I believe is purely academic for British Columbia. It's a waste of time to debate it as if it's a major political issue in this province because it isn't.

I think finally that we should be considering, at least as a short-term policy, export of surplus energy, especially surplus water power in medium- or high-water runoff years, to neighbouring areas of the United States at world prices, arm's-length prices, prices which will yield us revenue in this province, and which will be more easily obtained than by pushing the development of other export industries.

MR. BARRETT: Sell everything.

MR. DAVIS: The hon. Leader of the Opposition says: "Sell everything." I'd much rather sell some surplus water power than sell natural gas. The previous government quite rightly concerned itself with the sale of natural gas. That is at least a wasting resource, and if we're prepared to enter into any export arrangements with gas, surely short-term — one, two or three years at a time — export arrangements relative to Hydro power make a lot of sense. It's the sort of thing that's been done across international boundaries all over the world. It's been done increasingly in Canada and it's been done with great security because the export arrangements have time limits and the exports are terminated.

[ Page 291 ]

We've imported power from the United States, from the Pacific Northwest, and we've exported it there. I believe that there is an opportunity in high-runoff years to sell our surplus water to the United States in the form of electricity. That's good business, and in future years we may on occasion import power from their large power plants.

MR. KING: Mr. Speaker, there are a variety of reasons — which I want to discuss this afternoon — why I certainly don't intend to support the ever-increasing borrowing authority of B.C. Hydro and Power Authority. Let me note at the outset that there is still no regulatory authority effectively controlling the power forecasts of B.C. Hydro and Power Authority, their rating policy, or any of the power-generation options that Hydro, through some strange kind of relationship with the cabinet, goes through by a system of osmosis rather than public discussion. I want to make the point that British Columbia Hydro and Power Authority is the only public utility in all of Canada that has the authority to set their rates for electrical consumption without the need to justify an increase before some public regulatory agency.

I submit that it is most inappropriate that we be asked in this Legislature each year to grant to that authority an ever-increasing debt burden on the citizens and taxpayers of this province without any method whatsoever of calling that giant monolith to account. I suggest that it is totally irresponsible for members to get up and say that there is an effective mechanism by which even members of this Legislature can gain the details from the top officialdom of B.C. Hydro. That is a ruse; it's a shallow exercise. I want to say that that's not just my conclusion, but is also the conclusion of the Committee on Crown Corporations, which conducted an inquiry last year into B.C. Hydro's construction-management practices on the Columbia River Treaty projects.

I refer to a report tabled in the Legislature over the signature of the MLA for Omineca, Mr. J.J. Kempf. The report was filed with the Clerk of the House in early April in accordance with standing order 72(a) of the Legislative Assembly of British Columbia. I want to quote from this report, and I want to tell you that in so doing it's going to become very evident that the member for Omineca, who was chairman of that committee, will not be voting in support of this bill. He could not do so in good conscience, Mr. Speaker, after preparing and filing with this House an absolutely scathing indictment of the mismanagement, the lack of financial control of B.C. Hydro and Power Authority. He could not possibly vote for another $750 million of borrowing power to an institution which is literally torn from stem to stern in his report to this Legislature.

I want to go briefly through this report and refer to some of its conclusions, and some of the statements made by that committee, and more particularly by its chairman. On page 2 it's noted that as of March 31, 1978, the total cost of the Duncan-Arrow and Mica reservoir storage projects was $560.2 million, or 24 percent higher than the estimated cost of $451.5 million. It notes that there are inadequate cost-control mechanisms and that the whole history of B.C. Hydro and Power Authority with respect to the construction of storage and generating dams has been one of unprecedented overruns and lack of proper cost accounting.

This paragraph on page 3 is one that's significant:

"Despite seemingly sufficient time for Hydro to plan, schedule and implement these projects, this inquiry has disclosed some inability on the part of Hydro management to deal effectively with the demands imposed by these tasks. Specific problems noted include inadequate planning before going to tender and weak financial control during construction."

Mr. Speaker, this is not only the member for Omineca's (Mr. Kempf's) conclusion, as the chairman of that committee; this is the conclusion of the committee which is composed of a majority of government members. It goes on to make another reference:

"Nevertheless this perception led to many business decisions being taken hastily at the risk of incurring unnecessary additional costs. With respect to the adequacy of planning, it's noted for certain pieces of Hydro work specifications were either poorly conceived or incomplete at the time of going to tender."

Mr. Speaker, I wonder if that could be said to be true with respect to the engineering that went into the Revelstoke Dam and the engineering that went into the stabilization program on the Downie slide some 40 miles north of the Revelstoke Dam, and is a hazard to be reckoned with.

Mr. Speaker, on page 5 the committee notes: "In such circumstances cost-effectiveness, if and when achieved, is more the result of luck than skill." More the result of luck than skill, and now this government is proposing that we increase the borrowing power to an institution which they have heaped a scathing indictment on. In spite of this lack of financial competence, they want to increase the borrowing power by $750 million. They come in here with a one-line bill which is simply a blank cheque to increase the borrowing power by $750 million, to unload and unleash on the taxpayers of British Columbia an ever-increasing tax burden to support the debt of this monolithic monstrosity out of control. I say that's irresponsibility.

Let me continue with the report; there are some gems in here, Mr. Speaker. They're commenting on the contract cost estimation and financial control on page 7:

"Since the original estimate was based on a very preliminary design bearing very little resemblance to the power plant, no comparison of individual items is meaningful."

That's the testimony of one of Hydro's senior staff. The committee concludes:

"These statements are disturbing. Doing major-scale business on an ad hoc basis is financially perilous...."

Financially perilous — and yet they're asking us today, on the basis of a one-line blank cheque bill, to extend an additional $750 million borrowing authority; it's pouring good money after bad money. I'd be very surprised if the committee members who made themselves a party to this kind of an indictment of Hydro's management vote in support of guaranteeing another $750 million borrowing to that kind of an institution.

"The views expressed above by Hydro seem typical and suggest that they did not have proper systems in place so as to be aware of, let alone control, the burgeoning cost of these projects. The committee has not seen evidence of a strong,

[ Page 292 ]

financially sensitive team at work in Hydro during the construction of the Columbia River Treaty projects."

Mr. Speaker, there is more. On page 9 the committee concludes:

"It is all too obvious that if inadequate financial planning and control were to exist today, in consideration of the enormous scale of Hydro projects and their related costs, e.g. Revelstoke estimated at twice the cost of Mica, the consequences for both Hydro and the province could be severe.

That's strong stuff; that's indicating that we are on thin ice financially in terms of the amount of debt burden we can continue to accept on behalf of the taxpayers of British Columbia. Mr. Speaker, I expect the member for Omineca to be on his feet to defend the report which he chaired, and the very, very grave implications of the conclusions that are achieved in this report.

On page 13 this paragraph appears:

"It appears that the executive management committee acted in contravention of section 11(1) of the Hydro Act, which states that the executive management committee shall manage the operations of the authority subject to the direction and of Hydro's directors."

That's an accusation of breaching the laws, Mr. Speaker, a charge of breaching the laws by senior Hydro management.

MR. KEMPF: What year was that?

MR. KING: On page 14, Mr. Speaker, these conclusions are printed at the bottom of the page:

"(a) the experience and skills of a substantially enlarged, broadly drawn board of directors were available."

I should read the preamble:

"While the committee will not attempt in this report to suggest proposals to deal with all such difficulties, it feels that significant improvements in Hydro's operations would result if (a) the experiences and skills of a substantially enlarged, broadly drawn board of directors were available, (b) management and board practices and the continuing business of the Authority were not shielded by a series of veils from public scrutiny, (c) mechanisms were found whereby the government as steward of public money could meaningfully influence the various courses taken by Hydro."

There's the chairman of the committee admitting in this report that neither of his cabinet colleagues who were directors on that board had the weight or the authority to meaningfully influence policy decisions taken by Hydro. That's interesting, isn't it? He's saying that neither of the cabinet people have the weight and the influence to direct Hydro policy. If that's the case, I guess we have to conclude that the person who really enunciates policy with respect to energy matters in British Columbia is none other than Robert Bonner. We know what Robert Bonner advocates. He's on a nuclear kick. He says that nuclear power development in British Columbia is inevitable; it's going to come. Here's the chairman of the government's own committee which says — and I want to repeat that last one: "...if mechanisms were found whereby the government as steward of public money could meaningfully influence the various courses taken by Hydro...." He's saying that they have no mechanism right now to influence the policy of this Crown corporation. Either he has no confidence in his two fellow ministers, or he knows that Bob Bonner has a great deal more influence than either one of them.

The report continues: "While this is important, it may be of even greater importance that direction by government when exercised be overt." He wants any direction by government to Hydro to be overt. That's what the report says.

[Mr. Rogers in the chair.]

It sounds to me like that line came from the Watergate affair: the overt surveillance and the overt programs of destabilization. Remember those lines? I think Woodward and Bernstein wrote about those things. We're getting Nixonian stonewalling not only from this government but also from Hydro. They're even resorting to those terms.

This report is produced, for the benefit of the gallery, by a group of Social Credit MLAs sitting on that side of the House. It's chaired by the member for Omineca (Mr. Kempf). These are his conclusions. This is the largest scandal and the largest bombshell that has hit British Columbia in recent history. What an indictment, not only of B.C. Hydro and their financial bungling and incompetence, their engineering incompetence, but also a tremendous admission of political incompetence and political ineptitude on the part of the member's colleagues. It goes on:

"If the Authority was strengthened at the management level, a strong and articulate management team composed of people with diverse talents — e.g. legal, financial, engineering — headed by a chief executive officer whose sole responsibility would be the management of the Authority...."

In other words, this is a plaintive cry by the member for Omineca that Robert Bonner should divest himself of other responsibilities and address himself solely to the management of B.C. Hydro.

The member didn't have the courage to get up in this House and say: "I don't believe that Bob Bonner should be a member of the Trilateral Commission, and I don't think Bob Bonner should be serving on the boards of directors of a number of agencies and enterprises in this province that do a great deal of business with B.C. Hydro." He didn't have the courage to say that might be a conflict of interest. Rather, he snuck in this little one-liner that Hydro should be headed by a chief executive officer who has no other responsibilities.

It's a very, very interesting report. On page 17 we find this gem:

"The potential consequences of Hydro implementing currently conceived projects in the same manner as those which were the subject of this inquiry is of utmost concern, as it carries with it the risk of debasing the financial credibility of the province."

That is an alarming conclusion for a standing committee of this Legislature to come to, and I find it absolutely appalling that on the heels of this kind of indictment, we have before us a one-line bill suggesting that we increase the borrowing power of that very agency by $750 million.

[ Page 293 ]

It's an additional tax burden to put on the backs of the people of British Columbia.

It states on page 18, the final page: "It should be clearly understood that the committee's overriding concern is to ensure that unsatisfactory management practices disclosed by this inquiry are not continued." Now I think that's a good report, and I think it should be acted upon by the government. But for the government to come in with a bill advocating that we increase that borrowing power again by $750 million, with no accountability to any regulatory agency, much less the Legislature, is an insult to their own member who chaired that committee. It shows contempt for the taxpayers of British Columbia and it shows lack of financial control by this government. It's a government out of control; it's a government that has no leadership; it's a government teetering on the brink of financial disaster. Mr. Speaker, that is the conclusion of the member for Omineca.

I think it's a scandalous situation. What does this kind of borrowing power mean? What does it mean to the average person in British Columbia?

I want to tell you that it means we will be increasing the cost of servicing the debt for B.C. Hydro, and will be paying about....

MR. KEMPF: He's been in the dark for so long he wouldn't know anyway.

MR. KING: Mr. Speaker, the member is becoming uncomfortable. Here he writes this kind of report, an indictment of his own colleagues, and I guess he suspected that no one would read it. I guess he didn't realize that it might be made a matter of public record and read into the Legislature. The only thing I can say, Mr. Chairman, is that either they're going to put him in the cabinet to shut him up and buy him off, or he's liable to be going the way of Jake Huhn and Ed Smith; he may not be around next time.

Let's deal with the cost of servicing this tremendous debt. In outstanding bonds and debentures B.C. Hydro has about $5.1 billion now, according to the annual report for 1978-79, up from $4.7 billion last year; in capital projects, $722 million — up from $641 million last year surplus electricity sales, $34 million — $5 million in 1975. Let's get to the cost of servicing the debt. I think it's going to cost something like $783,000 a day to service the debt load on B.C. Hydro now, approximately, in round figures. That is about $32,000 an hour in round figures: $543 per minute; $9 a second in round figures is the cost to the taxpayers of British Columbia, in terms of the existing debt of B.C. Hydro.

These people come in here now, in the face of this scathing indictment by their own members — at least, a committee dominated by their own members.... We had representation on that committee.

Interjection.

MR. KING: Oh, I made that point earlier, if the member  would listen. Certainly the committee is dominated and controlled by Social Credit, and their members, such as they are.

We don't disagree with that report; we think it's a good one. We think it should be acted on. We think it grossly irresponsible for the government to come in here and advocate pouring good money after bad when the conclusions of the committee should clearly be dealt with, when there should be a major shake-up of the management of B.C. Hydro, when obviously there should be some major restructuring of that particular organization.

To give credibility to the committee report, I want to tell the House that I have great concern regarding the Revelstoke Dam. I've talked about those concerns previously in this Legislature. The dam happens to be just three or four miles from the city centre of the town in which I live. It towers some 500 or 600 feet over the city, and we have great concerns regarding the impact of this dam. I've raised those before in the House, and I'm not going to restate it all again.

I want to read an article, Mr. Speaker, that deals with problems that have been encountered on the Revelstoke Dam construction project, problems which give credence and absolutely validate the criticisms raised by the member for Omineca and his committee. It was carried in the Colonist of March 22, and it is headed: "Major Weakness Found Under Dam."

"B.C. Hydro has announced a major weakness has been discovered in bedrock below the Revelstoke hydroelectric dam which is under construction. Hydro said far more rock would have to be excavated than originally planned. The extra excavation is expected to total about 280,000 cubic yards of rock, with a corresponding increase in the amount of concrete required to build the dam and powerhouse, said Hydro spokesman John Sexton.

"Hydro would not release any figures on the cost of the extra work because tenders had already been called for the concrete work. Sexton said bids on the work had been due April 4, but had been extended to May 1 because additional information had been added to the bidding instructions, to include the extra excavation.

"However, a construction company executive said the cost of excavating the additional soft rock could run to about $15 a yard. He said cost of the extra concrete needed to replace the rock could be in the range of $50 to $90 a yard, meaning total extra costs could be as much as $30 million.

"The cost of the dam, with four turbines in place, is estimated at $1.5 billion. The project is expected to go on stream with four units in 1983, and two additional units will be installed in the 1990s. Hydro would not say whether the extra work would delay completion."

Now, Mr. Speaker, perhaps the members opposite don't think $30 million is very much money, but I think it's a fantastic amount on a project that has just been undertaken — we are just nicely into construction on the Revelstoke Dam. That revelation demonstrates that there was inadequate pre-engineering on the project. It demonstrates that not enough was known about the bedrock below the dam site. It demonstrates that the condemnations made by the legislative standing committee were absolutely factual, that there's incompetence in the engineering staff of Hydro, that there's inadequate pre-engineering into these kinds of major contracts, and that the people of British Columbia have been subsidizing that incompetence for years. Mr. Speaker, say it has to stop.

There's another sideline to this thing that really worries me, and that is the safety of the whole structure. I don't

[ Page 294 ]

think I have to draw pictures for this Legislature again regarding the implications of the Downie slide; but basically it's a slide about 40 miles north of the proposed dam site, containing about three billion cubic yards of rock and material that has, in fact, been sliding towards the reservoir for the last 100 years. It's now going to be saturated with the increased level of the reservoir. When Hydro applied for a water licence to build the Revelstoke Dam, they gave assurance that they would come up with an engineering program to stabilize this slide, to ensure that it didn't slip quickly into the reservoir, possibly creating a tidal wave that could top the dam.

Mr. Speaker, the water comptroller issued a condition licence on the basis that Hydro should come back to him at some later date and provide a plan for the stabilization of that slide. The cost of stabilizing the slide was not even estimated, much less identified in any precise way, because the engineering had not been done at that time. But a panel of eminent, world-renowned engineers gave evidence and testimony at the hearing that it might take up to ten miles of tunnelling to drain the water from the Downie slide. But they said it was impossible to make any cost estimates, because they didn't know what might have to be done beyond the drainage of the slide to stabilize it.

My question is, to all members of the Legislature: how can we be assured, in light of the early cost overrun and the shoddy engineering that went into the dam site itself, that Hydro's staff of engineers are going to come up with an adequate plan to safely stabilize Downie slide and prevent any chance whatsoever of a slippage into that reservoir with the spectre of a large body of water topping the dam at Revelstoke? The implications of that kind of thing happening are so horrendous to think about that it is absolutely frightening.

AN HON. MEMBER: Are you calling for nuclear power, then?

MR. KING: Certainly not. I think only a fool would say the choice is between building a hydroelectric plant which is dangerous and unstable or a nuclear power plant. That's an idiotic observation, my friend.

HON. MR. WOLFE: What's your alternative, then?

MR. KING: My alternative, Mr. Speaker, is what I've been talking about for the last 40 minutes, if the minister would open his ears. That is to comply with the recommendations contained in the committee report by your own member. We need to change the management of Hydro, to break down the structure, to inject some new blood, and to bring in some competent engineers, so that we are not subjected to ever-increasing overruns because of poor engineering. It should be pretty obvious what is necessary. I think you should fire Robert Bonner, too. He is just a Socred political hack anyway. I don't believe that Crown corporations, certainly ones crucial in dealing with the energy needs of the province, should be the pasture or the senate for retired friends of Social Credit. That's all it's been so far.

Interjections.

[Mr. Speaker in the chair.]

MR. KING: Mr, Speaker, let me get back to the gist of my arguments and concerns, and they are valid.

AN HON. MEMBER: That's your view.

MR. KING: What an asinine statement for the Minister of Finance to make. If you are not equally concerned, regarding the safety of British Columbia citizens, and those south of the border, because of the security of the dam system then you don't deserve to be a citizen of British Columbia, much less a member of the House. What an asinine, stupid statement.

I'm concerned about the adequacy of engineering that is required to absolutely and safely ensure that the Downie slide does not slip into the reservoir and compromise the safety of the dam. I'm concerned — because of the cost overruns experienced already in the construction of the dam site itself — that corners are not cut to recoup some of the financial losses at the Downie slide. It is a major engineering undertaking, and a major cost item.

I want to say that anybody who doesn't understand the implications of an unsafe dam system is thumbing their nose and disregarding what would be the major catastrophe of world history, in terms of man-made catastrophes. If the Revelstoke Dam was ever compromised by a major tidal wave and topped, we are looking at the potential destruction of every dam on the Columbia River chain.

The implications of that kind of catastrophe should be pretty obvious to everyone. That is not just my opinion; it is the opinion of professional engineers who say it is probably a 50-50 proposition that if one dam on the Columbia River chain went, they would all go. I think it is a reasonable proposition. What I am saying is that we have to be absolutely assured that no such possibility exists. Every attempt and every possible avenue must be utilized to ensure that the dams are stable, and that the Downie Creek slide is stabilized. With the kind of engineering that Hydro has displayed so far, I cannot be other than very, very concerned and very apprehensive. What I am suggesting, Mr. Speaker, is that all members of the House should be equally concerned.

I am appalled and amazed that the Minister of Finance would come in asking for a blank cheque to finance Hydro's incompetence, to impose additional debt burden on the taxpayers of British Columbia, with a two-line bill which gives no justification, which gives no indication of a shake-up in terms of Hydro's management, in terms of any change in their policy direction, in terms of any better financial or cost control accounting systems. I think it is an act of irresponsibility, and I certainly do not intend to support this kind of irresponsible document in this House.

MR. BRUMMET: Mr. Speaker, again we seem to have an example where we start out on the debate about some borrowing power to add some projects that Hydro needs, and we end up with quite a digression from the original topic. We get many, many words on record, Mr. Speaker, on a variety of topics. We get dramatic and colourful debate raging on. Yet we do have to consider what is happening in the real world. I think the members on this side can certainly share the concerns that are expressed by the member for Shuswap-Revelstoke (Mr. King) and certainly share the concerns that were expressed in the report that was selectively quoted from. However, while all this debate goes on, certain projects must also go on.

[ Page 295 ]

I am always intrigued by the expertise that is so readily available in retrospect rather than in advance of anything. I do know that it is quite simple, Mr. Speaker, to guarantee that nothing wrong will ever happen, that no problems will ever develop, if you very carefully undertake nothing. I'm not even so sure of that. Those members should remember, Mr. Speaker, that it was much more difficult when they had to make decisions rather than just stand up and criticize and debate.

I recall one quotation: "What did the critics ever build?" I wonder what they actually did build. So when the opposition members are speaking against this bill, I have to wonder at their motives. Are they simply against this? Are they trying to delay it? I hesitate to use this question, but are they trying to make political mileage out of this?

AN HON. MEMBER: Oh, no, no, no.

MR. BRUMMET: Oh, I'm sorry. I should have realized that there would be no politics involved. However, then I must assume that in speaking against the bill they are trying to stop the projects which the Minister of Finance spelled out. The Revelstoke project, notwithstanding the concerns that were expressed.... Apparently if Hydro does not have any more funds to use, then we stop the Revelstoke project, the Seven-Mile project, the Peace Canyon or Site I project as it is more likely known there. It's pretty well on the way to completion — I believe it's in its last year. If this bill is rejected, does that mean that project stops, Mr. Speaker, and nothing else goes on there, that the water is just allowed to go by there, no power? Are they stopping the completion of the Shrum generating station? Is this what the intent of speaking against this is, to stop all these projects, and to stop all of the further studies? Power seems to create other projects that create jobs. I find that here we have opposition members — they made it very clear earlier this afternoon, I believe in question period in various ways — that are definitely against nuclear power. Certainly we share their concern there.

MR. BARRETT: Are you for it or against it?

MR. BRUMMET: I don't like the idea of nuclear power at all. I just like to have an open mind.

So stopping all of these power projects, stopping all of these projects that result from further power development such as.... Are they speaking against this and for stopping the power line to Vancouver Island here? I thought that the members here had a lot of constituents here that might be interested in further power and the jobs that you keep talking about that you're going to give them. But you stop the project and you stop this. And you promise more jobs. So I really am intrigued, Mr. Speaker, with how they do this — that they stop all of the things that create jobs an yet at the same time promise jobs. You can't have everybody working for the civil service. There have to be some productive jobs out there.

We do have to have power. We do have to have projects that are created as a result of this power in order to have jobs in order to carry on the economic stability and progress of this province.

Mr. Speaker, unlike the member for Shuswap-Revelstoke, having nothing further to say, I believe I will stop talking.

MR. LEGGATT: I will try to deal with some aspects that haven't been dealt with in regard to the bill. One of the concerns I have in looking at this and in thinking about approving this additional borrowing authority — we're looking for another $750 million — is where we are going to go to get that $750 million.

Are we going to do what the Minister of Finance did when he initially came here? He borrowed the money in the United States when the Canadian dollar was trading at par. No doubt he's now paying to the United States an additional 15 percent on that loan. Is he going to go to the Arab market?

I wonder whether the Premier was in Ottawa making a deal the other day with Joe Clark to see if they had some influence left in the Arab market. I suspect there aren't any left. That wonderful coalition has certainly dried up that source of funds for the foreseeable future, I would think. That is a source of funds that gives us a very reasonable rate on that return. When we approve this particular borrowing, the question B.C. Hydro and the minister are going to have to think about is: where are we going to get $750 million? Apparently BCRIC have raised a fantastic amount of capital out there somewhere. Maybe BCRIC is going to salt it away in Hydro.

Interjections.

MR. LEGGATT: There were a few people who recognized its value — maybe one thousand recognized its value. Those few are going to make all the money in regard to those shares. Keep that in mind.

Some people in this House have said that this is a blank cheque to B.C. Hydro to proceed in the manner in which it has gone along. It is saying to B.C. Hydro: "We're not really unhappy with the way you did the Columbia River Treaty." My colleague has already read out what a committee of this House has said about that.

I'd like now to show you how they are operating internally. This is a memo that I'm assured is a legitimate and accurate memo, an interoffice memo in B.C. Hydro. It's dated January 19, 1979. The subject is executive furniture in B.C. Hydro. Apparently this wonderful corporation has been unhappy in the executive suites. Perhaps the cushions aren't quite as soft as they used to be. It reads:

"Current allowances for executive suites are as follows: senior officers, $11,500; division managers, $7.500; department managers, $4,300 other groups, $1,500. There are approximately 120 employees in Class D; the cost of upgrading the furniture of Class D employees to Class C will be in the order of $500,000."

That's why this corporation should not get a blank cheque out of this institution.

This is the point: this is the tip of the iceberg. This is exactly what the legislative committee found when they investigated the operation of that corporation. As long as you simply roll over and play dead every time Mr. Robert Bonner says we need another $750 million, you're going to encourage that kind of stupidity and waste within that corporation. That's what's going to happen.

You can't have it both ways. This is a government that has always prided itself on balanced budgets. In fact, the previous Premier of this province, W.A.C. Bennett, and the previous Premier in the New Democratic Party were

[ Page 296 ]

wedded pretty well to the balanced-budget concept, believe it or not. Examine it. You'll find that it's true. One of the reasons W.A.C. Bennett was so wedded to the balanced budget was that he didn't want to see governments grow out of control. He believed that by balancing the budget there was a way to control expenditures within that organization. By voting in favour of that bill you're completely abandoning that principle, because you are letting Hydro grow at its own pace and its own rate, and you're letting it grow out of control.

We cannot control energy consumption in this province as long as you let that consumption be partially determined by the policies of Robert Bonner and by the policies of Hydro. That's why this bill is so bad in principle, and why it is that so many of us cannot vote for this — even if it meant some temporary unhappiness within Hydro. It would force them to look for different sources of funds and force them to re-examine their rate structure, for example. It would force them to put rates up for high consumption of energy, so that we can get into the question of conservation.

By voting for this legislation, you're going to change nothing whatsoever. You're not going to give this province the opportunity to seriously examine alternate energy forms.

The member for North Vancouver–Seymour (Mr. Davis), in his usual rational and eloquent way, was discussing the alternative of wood waste as a power source; but he directed his attention to the existing systems for wood waste, and as long as you simply provide Hydro with a blank cheque in terms of energy, then, Mr. Speaker, no one is going to develop those new technologies to deliver that kind of wood waste energy to everyone. We need ways to move out of those traditional sources of power, to go back into sawdust burners, back into wood use in all the homes and away from this kind of energy consumption which is going to lead, in the long run, to a financial disaster.

Mr. Speaker, I'm always amused by a party that takes so long to talk about balanced budgets and debts, chastising everyone else for waste, but when a bill like this comes along, there's almost no comment. It's just "Ready, aye, ready. Let's give them anything they want. Let's let them waste this money." I would hope particularly that the member for Omineca (Mr. Kempf), whose committee delivered such an excellent report, will back up that report with his vote after this is called.

MR. BARRETT: Mr. Speaker, I want to thank you for your patience in this debate, which in many ways is perhaps the most important debate facing us in what obviously will be, at the earnest desire of all members, a very short session.

We've not really had an opportunity, as you know, to debate such a bill as this for well over a year. For one reason or another, the government has not been able to call the House together for extensive questioning in estimates or financial matters, really, since last spring. Now that we are finally here, we are being presented with a bill in second reading that is to give to B.C. Hydro $750 million borrowing power without any further scrutiny.

I want, first of all, to say a few words about the report by the Committee on Crown Corporations. I voted against that committee. I felt that the work that committee was undertaking could best be done by the public accounts and economic affairs committee. I said so, and I voted against the committee; much to my surprise, my prediction was incorrect. The committee did set about doing their business, and I don't mind admitting that I think the Crown Corporations Committee did an excellent job in a new dimension of accounting for the expenditure of public funds.

Now the government wishes they had taken my position and they wish I had taken their position. For the first time, we've had an opportunity of demonstrating to the people of British Columbia what good work MLAs can do in a committee that's thoroughly researched, that sets aside the necessary partisan debate that takes up a lot of our time — which is our traditional and legal responsibility in this House to participate in — and sets about on a specific project on behalf of all the taxpayers of British Columbia and says: "Let's look at what's happening with some of our tax money."

I'm the first to say that although I argued against the committee, I've never been afraid when I've had an opinion or a vote that has proven to be wrong, to stand up and say: "I made a mistake. My judgment was wrong." I want to publicly say that that committee, in my opinion, has done a good job. I voted against the establishment of the committee, and I must say I placed my vote, obviously after their work, in the wrong direction. It doesn't make someone a lesser person to say they made a mistake, in this business. I think the public would be well served if a lot more of us, on occasion, would stand up and say that perhaps our opinions held in the past were incorrect and time has proven us wrong. Certainly, in the case of this committee, I admit it. The committee has done a first-class job and deserves the congratulations of every thinking taxpayer in the province of British Columbia.

Now that I've been so generous and gracious, and so thoughtful, in this particular debate it would be a welcome bit of balm for some of my bruised feelings if someone on the other side, say the member for North Vancouver–Seymour (Mr. Davis), would get up and say that perhaps the Social Credit Party's opposition to the B.C. Petroleum Corporation was a bad vote too. I would welcome that statement.

MR. BRUMMET: What did you ever do?

MR. BARRETT: For the information of the member for North Peace River, we withstood 14 hours of personal abuse from one member alone in establishing the B.C. Petroleum Corporation — 14 hours of vituperative, vicious, personal attack and a vote against the Petroleum Corporation. Yesterday, unlike Hydro, that Petroleum Corporation returned to the people of British Columbia, in one year, $228 million profit.

What did we ever do? We had the guts to establish a marketing agency for natural gas that allowed the member for North Vancouver–Seymour to point out in this debate that B.C. Hydro has the ability to deliver natural gas at half the world market price to the consumer in British Columbia, simply because we were the government that demanded we get a world price for our exports. We are therefore able to subsidize those fortunate residents in this province who have access to natural gas with a low-cost fuel to allow them to heat their homes at a lower rate than the inflationary cost in terms of other forms of heat.

[ Page 297 ]

Mr. Speaker, I want to address my initial remarks directly to the statements made by the former Minister of Energy, Mines and Petroleum Resources (Mr. Davis):

"While it may indeed be a desirable fiscal goal to allow domestic natural gas rates to rise to the world price level — perhaps even aiming toward equivalent Btu price levels vis-à-vis oil — it would be an extreme hardship to do so for the average homeowner in British Columbia who, although he is not aware he's being subsidized to quite a heavy extent by that low-cost natural gas, his budget couldn't stand it."

I do appreciate the comments made by the member about the double pricing in natural gas and the fact that we had to fight Ottawa to release ourselves, as you well know from your own Ottawa experience, from the 10 percent — or was it 15 percent? — gap that at one time existed in terms of the two pricing systems.

AN HON. MEMBER: Five percent.

MR. BARRETT: Five percent. Then they brought it up at the Western Economic Opportunities Conference to 10 percent. When the federal government was in a minority they were most receptive to changing things. It's just like a few months ago; when Social Credit had a 17-seat majority, we never heard the word "cooperation"; now, when they're down to five, they want to make love and cooperate every day. It is funny, Mr. Speaker, what a difference in attitude a few votes make.

I must say that I cannot agree with the member for North Vancouver–Seymour that we should begin to adjust the price on natural gas for the domestic consumer. However, I do think — and it should be seriously considered, and I advise the Minister of Finance (Hon. Mr. Wolfe) to talk to his colleague who is on the board of B.C. Hydro — that it would be worthwhile for Hydro to examine whether or not there could be a modest and gradual system of increasing the price of natural gas for our large industrial users in light of the fact that those industrial users are benefiting from the current high exchange rate on the Canadian dollar. They would be able to handle the increase in that energy source in conditions that allow them to compete in the American market with the advantage of the exchange on the dollar. So I flag to the minister that it would be worthwhile to examine whether or not the industry could handle some gradual increases, to increase the revenue of the corporation. I'm not opposed to the lower prices of domestic natural gas; I'm not opposed to the lower prices to industry. The purpose of setting up the Petroleum Corporation was not only to sell natural gas at its true market value, but also to give private industry a little cushion that allows them to compete with their American competitors with some leeway.

So, Mr. Member for North Vancouver–Seymour, I agree that the private sector cannot take on the natural-gas pipeline to Vancouver Island.

But why does it take a generation of 25 years to get the unanimity in this House to understand that it is important for the private sector to be a major instrument not only in transportation but in the energy field as well, for the competitive sector of the community that is still out there to have an opportunity to compete with a stable source of energy as well as transportation? Why does it take all this time to get over the emotional word "socialism" which is such a barrier to rational, logical, thoughtful economic planning? It should have been taking place in this province many, many years before now.

In terms of this borrowing in the energy field there is now a danger nationally, as my colleague from the Coquitlam riding has pointed out, of there being a restricted field for borrowing. If we pass this legislation today there is still the now highly sensitive question of limiting fields of borrowing. It is true that the Arab monetary fund has withdrawn access to their borrowing facilities from the people of Canada. When we borrowed money, through the advice of a number of excellent advisers, from a number of mid-eastern states, we borrowed that money in Canadian funds. In retrospect, when you get past all of the emotional yelling about those borrowings, they are a prime source of funds compared to what we now have to pay as taxpayers in servicing the American debt we have.

The Americans are very clever. The loaned us the money in American funds and we must repay in American funds. We did negotiate wisely with the Arab money and we negotiated in Canadian money, the difference being this: for every dollar borrowed from the Americans by B.C. Hydro at 10 percent, we now must pay 25 cents to service, at this time, annually. For every dollar we borrowed from the Arabs at 10 percent, we pay 10 cents.

I don't mind all the heaped abuse we took at the time for the borrowings, but I'll bet you anything, Mr. Speaker, that even the smiling Minister of Energy, Mines and Petroleum Resources (Hon. Mr. Hewitt) would grab at $500 million in Canadian funds, to be paid back in Canadian funds at 10 percent, anytime he could get it. If someone came to you and offered you $500 million on the strength of this bill at 10 percent in Canadian funds, you wouldn't tolerate the giggles and chuckles about the source of the funds. You'd be there with your pen to sign it as quick as you could, and if anyone criticized you, you would say they were being irresponsible politically.

MR. LEA: Just like the Minister of Economic Development (Hon. Mr. Phillips).

MR. BARRETT: Yes, it is interesting to notice how the tune changes depending on what side of the House you are on. My good friend for North Peace River (Mr. Brummet), I excuse your comments on the basis and under the category of N.B. — New Boy. But if you want to get up and make comments in this House and lecture members of this House with glib, generalized statements, I recommend to you the responsibility of doing a little bit of research before you open your mouth about projects and what took place here in this House on borrowings and commitments.

Having addressed myself to that matter, Mr. Speaker, I do express, publicly, regret at the ineptitude of the national government in not taking a clear-cut position at the time of economic troubles in North America and restricting our field of borrowing. It's pretty stupid, and now that we are faced here with a bill of $750 million that is of major importance to continuing projects in this province, we have a compounding factor of a narrowing field of borrowing availability.

How important is this, Mr. Speaker? Every citizen of this province who has to pay their light bill, or buy ICBC premiums, or shop for groceries should understand that the accumulated debt of B.C. Hydro now is so extravagant that

[ Page 298 ]

the average family of five citizens in this province must come up with $625 million a year just to pay the interest on their share of the borrowing by this monstrous corporation. Every head of a family who is responsible for a household of a mother and three children must earn $625 a year, if it was broken down on a family basis — but certainly on a per capita basis — out of their wallet on to the table and over to B.C. Hydro just to service the interest.

You have to understand some history when you are dealing with that amount of debt. A major portion of that debt, Mr. Speaker, was because of the Columbia River disaster. It was a massive sell-out of resources from this province by an inept government of the day, that has left this province with $1 billion in debt, just to build some dams for our American friends.

HON. MR. PHILLIPS: Malarkey!

MR. BARRETT: A bunch of malarkey, Mr. Speaker! I want to tell you that the person who stood up in this House and had the courage to detail that horrendous story, as it came to a conclusion fiscally, was none other than the present member for North Vancouver–Seymour (Mr. Davis), who had the guts to address himself to that problem in this House. We are $1 billion in debt.

Those who do not learn by history are condemned to relive it. I attacked the Committee on Crown Corporations as a concept. I say I was wrong. Now the Crown corporations committee has given us evidence as to, partly, why the Columbia River Treaty was such a disaster. That Crown corporations committee, made up of good and true members in this House, catalogued a story of fiscal and engineering incompetence that is a major scandal in the province of British Columbia.

I refer to a number of scathing and condemning quotes that are so black that I am sure they must force the member who offered them, as chairman of the committee, out of the House rather than stay in embarrassment. The chairman of the committee has now left the House because attention will be drawn to what he put his signature to.

MR. NICOLSON: He's too modest.

MR. BARRETT: Oh, is that what it is — too much modesty? I thought the flushing of the face and the addressing of the attention of the House to this report would be interpreted by that member as cramping his style of getting into the cabinet. Not at all, say the new members. They've got nothing to worry about. They had nothing to do with this committee. They're just sitting there, hoping for the best.

This is what the committee said, Mr. Speaker. If I were to make this statement, without identifying the source, the first person up on his feet in this House, yelling at me as being a nasty person, would be none other than the member for South Peace River (Hon. Mr. Phillips). "Don't you say those things!" he'd say. Isn't that usually how he talks? I'll read this paragraph:

"The committee has not seen evidence of a strong, financially sensitive team at work in Hydro during the construction of the Columbia River Treaty project. An example of this shortcoming was the lack of understanding by Hydro officials present at the hearings of the purpose of such a basic financial tool as a sensitivity analysis which examines the effect of a change in timing, the effect of a change in the cost of a major item such as steel, cement or labour, on the financial feasibility of a project."

My friend, the member from North Vancouver, got up and implied that anybody can have hindsight. I commend to him the responsibility of research of speeches made in this House by Randolph Harding and George Hobbs, who died in the service of this House at the height of the Columbia River Treaty debates. They predicted what a disaster the Columbia River Treaty would be. How tragically correct they were. So, Mr. Member, do not come to this House and lecture us about the possibility of hindsight. In the 20 years I've been in this chamber I've heard all the arguments on the Columbia River Treaty, and I want to tell you, much to my regret, the predictions made by Ran Harding and by George Hobbs were correct. It was a disaster, and how ironic it is that it was a Social Credit government–sponsored committee that proved, indeed, that Hobbs and Harding were correct.

What else does the committee say? There is quote after quote after quote in this committee report that would sober up a government into immediate action in terms of fiscal responsibility and accountability of that monstrous agency.

Mr. Speaker, let me bring this to your attention, because you understand the rare occasion of unanimity in this House. Listen to what the committee had to say:

"If there is one point on which the committee is not only unanimous, but adamant..."

Where have we, as men, seen that word used as a demonstration of permanence?

"...it is the following: that construction projects now being undertaken by Hydro, projects which, during the course of the next five years or less will, in effect, double the size of the Authority, must be carried out in a very different manner than which the committee observed during the inquiry."

The committee said that we must not continue the same practices. The committee has tabled its report, and in the face of that committee's recommendation, what do we have presented to us today by the Minister of Finance but a bill saying: "Please give them another $750 million." He gave not one single shred of evidence that there have been any changes at all at B.C. Hydro that have been recommended by the committee.

Socreds, NDPers, coalition, turncoats, roundabouts, Liberals, Tories: whatever they were, all on a committee together said: "No more money to Hydro until we know what they're going to do with the money." My colleague for Coquitlam-Moody (Mr. Leggatt) read out a list of ad executives. It sounds like an explanation of some Social Credit theory: ABC executives; "a" executives get 12 grand and a gold key, "b" executives get eight grand, a couch and a silver key, "c" executives get five grand and have to use the general washrooms; and things are so tough that "d" executives have to wait in line.

That agency has gone mad with its own self-importance, buying furniture with this kind of memo, making extravagant expenditures, and you come in here and expect us to vote for another $750 million to be poured down that same old hole? You are the ones who defined in this report and said "no more of that nonsense."

[ Page 299 ]

AN HON. MEMBER: Is that what he used it for?

MR. BARRETT: Mr. Member, have you sold it yet? Which one of you is using it? Which one of you is sleeping on there?

Interjection.

MR. BARRETT: No, he didn't. It was covered with work that you have never caught up with, any one of you, in terms of the amount of time and energy that minister put in.

I think there is an opportunity for us to meet the responsibility that committee laid out to this House. I believe there is an opportunity for us to demonstrate to the taxpayer out there who is concerned about the expenditure of their funds.... When we tell civil servants and working people and others in hospitals to show restraint, we have to demonstrate to them that we in this Legislature are showing restraint too. We can't say on the one hand. "Here's $750 million for B.C. Hydro," but, "No, you can't have another dime an hour," or, "No, you can't have another three nurses in the hospital...." If we want the general public in this province to show restraint in their lives, then we must show restraint here in this House and demonstrate to the people that we're scrutinizing every dollar.

I remember when the Premier was Leader of the Opposition and ran around screaming: "Not a dime without debate." There's $750 million being passed here in the face of that report on how B.C. Hydro handles its funds, and there's not going to be any other source of examining the purpose of those expenditures other than second reading and committee stage.

We're here to work. We've been here two weeks, and not one House committee has been called. The House has not been working for over a year. Time is a-wasting, and all we've done in a year up to this time.... We've not had one House committee called in the two weeks that we've been here.

MR. SPEAKER: Hon. member, perhaps under a proper motion that would be in order.

MR. BARRETT: That is why I'm proposing a motion. I've done a great deal of thorough research on this. I know, Mr. Speaker, that you like the assistance of thoroughly researched MLAs. I want you to listen carefully to this. I want you to understand that we have a responsibility to begin to ask some serious questions about where this money will come from and under what conditions we will borrow it and where it will be spent. Will any of this money go towards developing nuclear power? We have not had that assurance. Will one penny of this go towards research on developing nuclear power? We don't know. We've never had that assurance. So I move as follows: that the motion "that Bill 11, British Columbia Hydro and Power Authority (1964) Amendment Act, 1979, be read a second time now" be amended by deleting the words "be read a second time now" and substituting the words "be referred to the special committee appointed on June 6, 1979, for consideration."

Mr. Speaker, in making a ruling on this, I would like to draw your attention to Beauchesne, fifth edition, page 226, No. 746. I wish also to draw your attention to Sir Erskine May, nineteenth edition, pages 498 and 499. I've attempted to avoid the problem of referring it to a committee that does not exist, or requesting that a committee be structured.

MR. SPEAKER: Hon. member, in looking at the motion, at the outset there is a problem of logic in committing a bill in second reading to any committee, whether that be a Committee of the Whole House or whether it be a select standing committee. There's a further problem in the logic of committing a bill to a committee which has not yet been selected, and as a result the Chair is a little perplexed in trying to find the motion in order. We'll give it a little more consideration.

MR. BARRETT: Just in a second argument, Mr. Speaker, in terms of reasoned amendments, it was found that the argument raised by yourself is correct: referring it to a committee that is requested to be structured is out of order. Therefore I referred it to the special committee for selection, which seems to overcome that technicality. There was a similar instance in 1841, Mr. Speaker, very recently acknowledged in Parliamentary Practice as allowing this particular device in consideration by yourself, the Speaker. I would welcome, perhaps, some advice from yourself that this matter be reserved for decision by you if time indeed were necessary. I could argue in chambers with the assistance of a number of my colleagues, and refer also to the case referred to by the first member for Victoria (Mr. Barber), Gibson versus the Crown and Speaker — a similar situation.

MR. SPEAKER: Hon. member, I welcome the suggestion to perhaps reserve a final decision and come back to the House with a report. In the meantime, not to interrupt the business of the House, we would proceed. However, I would caution the hon. member that there is a real, logical problem in the matter of referring a bill in second reading to a committee....

MR. BARRETT: Of selection.

MR. SPEAKER: Not necessarily of selection. It's the whole idea of referring a bill which is in second reading to a committee. Now it could be conceived that the matter could be directed to the attention of a committee, but not the bill itself, because the bill itself must first of all be completed in second reading before it can be committed. So in essence what the Leader of the Opposition is suggesting is that we close debate on the bill.

MR. BARRETT: I do not wish to argue, and I certainly accept your suggestion of some time to examine it.... I would refer you to May, nineteenth edition, pages 499 and 500, which has dealt with this illogic that I'm using as the basis of my argument, the illogic being that there is no standing committee, of course, that this can be referred to. I quote one line: "The amendment must not be concerned in detail with the provisions of the bill." This is the escape hatch under Catch-22 related to this particular amendment.

MR. SPEAKER: Thank you, hon. member. Perhaps the hon. member would allow me to refer to the citations and then bring the decision to the House.

[ Page 300 ]

MR. BARRETT: Thank you very much, Mr. Speaker. Any advice I can give you I would be happy to provide.

MR. SPEAKER: And now to continuation of second reading.

MR. COCKE: Mr. Speaker, I'm sorry we are not debating the very reasonable amendment put forward by the Leader of the Opposition. I certainly didn't want to let this bill get by without having a few words to say with respect to a number of various areas surrounding the bill. Traditionally this House has supported — or most of the members of this House have supported — Hydro borrowing. I happen to have been here for the last ten years or so, and noted that there were few occasions when Hydro bills were not supported.

However, Hydro bills continue to grow and are more frequent in their requests for larger and larger sums. In view of having been a member of the Crown corporation committee that spent most of its time watching Hydro's arrogance.... That was, incidentally, one of the committee's discussions from time to time — the utter and complete arrogance of Hydro, who feel they report to no one, who feel they're responsible to no one. As far as they're concerned they are a power unto themselves. It's very difficult for me to understand how our government can now come before this Legislature with a bill such as this, having made no improvements whatsoever with respect to the administration of Hydro. They've done nothing.

If the minister had come in — and I'd sure like to hear that very articulate pair in the back get up and say some words of support for this dramatic piece of legislation — and said, "We've fired Bob Bonner," that would have been a good start. That would have been an excellent start. Bob Bonner has come out in contrast as recently as yesterday to what is suggested in the throne speech. And when I say suggested, I say that with every good reason because the throne speech wasn't definitive with respect to where that government stands on nuclear power. They skirted around it.

The member for North Vancouver–Seymour (Mr. Davis) this afternoon said a few words. He said: "We won't need it until the twenty-first century or beyond." "We won't need it" or whatever we might say doesn't change the fact that Bob Bonner says it every time he has an opportunity to stand up in public.

Beyond that, the minister asks if I want to shut him up. Does the minister agree with the statements that he's making? Because he is the person that is responsible to this government for the policy of Hydro. Obviously his policy is clear. The minister has difficulty with that. He has difficulty with most everything, but he sure has difficulty with that.

Yes, Mr. Speaker, I anticipate that we will go lumbering along and we will accept all that Hydro tells us as gospel, despite the fact that we know better, despite the fact that in this House most of us have had access to a report that's a condemnation of Hydro from top to bottom. We've seen no evidence of any change in terms of the government's handling of that Crown corporation. Are they going to fire Bob Bonner? Will they fire Bob Bonner? If not, why not, eh? Why not?

I suggest that we will go on accepting these immense borrowings that put us further and further into debt. One of the beautiful aspects of Social Credit has always been no direct debt, just contingent liabilities up to your eyebrows. They have sunk this province into debt beyond reason, Mr. Speaker. And since this new little group of opportunists have been in there — and that former manager of a credit union that was allowed to lend up to about $150 without going to his board — since this government have been in power, they've established a number more Crown corporations to avoid direct debt.

The fact of the matter is that we know what debt is. When you owe money, you owe money. That's right; when you owe money, you owe money. Whether it's not reportable to the Legislature or whether it is, this government is directly responsible and we as legislators are directly responsible for this debt, this $750 million that we go further in the glue for.

HON. MR. MAIR: Where's Cass-Beggs now that we need him?

MR. COCKE: You know, what an improvement he would be.

Mr. Speaker, furthermore, last year was the first time I voted against Hydro borrowing, and I said at that time I would vote against that borrowing, I will vote against this borrowing and I will vote against any future borrowings until such time as Hydro begins to spend significant funds on alternate research. They do nothing. They don't. A little bit of fanfare on the side but they do nothing, almost identically the same as every....

Interjection.

MR. COCKE: Oh, come on, Mr. Minister. You don't even know what goes on in that ivory tower despite the fact that you're a minister responsible.

Mr. Speaker, what are they doing? A little peripheral work on alternate sources but nothing substantial. If they are, it's not showing up in any reports.

Interjection.

MR. SPEAKER: Order, please. If hon. members wish to join in the debate, perhaps we could recognize you one at a time. The member for New Westminster has the floor.

MR. COCKE: I'll just say this: oh, what a lucky day it was for this province when the NDP were in power! We laid claim to every source that at that time Hydro could identify for geothermal power. That's right. Unlike California and unlike other areas where there is access to geothermal power, where it's being claimed by oil companies and private enterprise energy companies in this province, we laid claim in the name of the people. Thank heaven for that! (Welcome back, Mr. Minister.) We don't expect that from the Socreds. We'll never expect it from the Socreds as long as we have ministers like the Minister of Economic Development (Hon. Mr Phillips), who can see no further than the edge of his desk — nor will he ever.

I wonder, however, if we're just going through an academic exercise. Our Premier's great friend, Joe Clark....

MR. KING: Joe who?

[ Page 301 ]

MR. COCKE: Joe who? Joe Clark. Our Premier is down there visiting him, I think, at the moment. As a matter of fact, he's on his way back. He's probably here by now. But they were down there holding hands, talking about the future of our great nation. His great friend, Joe Clark, has taken care, for probably some time to come, of the availability of massive sums like $750 million. Now the government can stand up and they can say: "Oh, well, we'll borrow it from New York, or we'll borrow Eurodollars, or whatever. We don't need petrodollars." But the fact of the matter is that when the petrodollars dry up, it means the access to the other funds is going to be somewhat limited as well. I'll tell you right now that you're not going to get the fancy interest rates that you're going to want; and that's by virtue of the blundering Conservatives and the Socreds and the national Conservatives in this country.

Why would they identify with that gang? I'I tell you why. They're all clumsy — clumsy, clumsy! Fortunately for us, we don't have a Social Credit government in Canada. We haven't had one in the history of this country. But if we had, heaven knows where we'd be now. We'd be somewhere down around Botswana, or Rhodesia, or something like that.

Interjection.

MR. COCKE: Yes, we noticed what happened in Alberta.

Interjections.

MR. SPEAKER: Order, please. Would the Minister of Economic Development (Hon. Mr. Phillips) like to be recognized to make a speech? Please stand the minute the member takes his chair. Please proceed.

MR. COCKE: The member for Kootenay (Mr. Segarty) said we'd have another Nicaragua if we had something or other. I'm not sure. But we do know that in Nicaragua we've got a Social Credit government. That's right.

Interjections.

MR. COCKE: Somoza is a Socred. Anyway, Mr. Speaker, I think there is a possibility that they're going to have a good deal of trouble, particularly to get a good prime rate of interest.

I'll tell you something about Hydro's desperation as well. Hydro has tried very hard over the last year or two to look good. I notice that the minister responsible for Hydro has raised his mike, and I hope that he's going to answer this question. One of the things that they did recently — and I'm talking of within the last year — last winter they ran our water reserves down to the most dangerous level ever. The minister shakes his head.

I want you — through you, Mr. Speaker — to get up and say definitively that they did not. I've had that from so many responsible sources in Hydro that I would like to see the minister stand up and say that they didn't. They gambled — and it was a heavy gamble. What did they gamble on? Heavy, heavy precipitation during the spring and summer of this year.

Interjection.

MR. COCKE: Oh, yes, they got a good price for the power they sold to California — I even know the price, and it sounds like a good business deal — but they jeopardized the reserves of power we have in this province over this summer, no question about that. And when you're next talking to some of your friends in Hydro....

Interjection.

MR. COCKE: I know. I would suggest that you don't talk to Bob about this; talk to somebody at a level or two down.

Mr. Speaker, that's the kind of operation that we're talking about this afternoon; that's the kind of operation that the government suggests we should assist in securing borrowing power of $750 million. Good old Hydro! Trust Hydro! Trust Bob Bonner! Mr. Speaker, fire Bob Bonner! That's the only way that you can get a good start on getting a handle on Hydro. And then shake up the whole operation and come back to this House and tell us what should be done about borrowing and maybe we'll listen to you at that time.

HON. MR. HEWITT: Mr. Speaker, I'm pleased to get up after the member for New Westminster. When he ends his comments with a question, I'll be able to respond to him and indicate to him just what was done in B.C. Hydro in regard to water storage.

I think the member for Alberni (Mr. Skelly) — I'd like to go back to the beginning, because we've listened to a number of members and they've made several comments which are rather interesting — made the statement that they accept the need for the borrowing authority. And with that statement I thought we were going to get unanimous agreement that B.C. Hydro in its planning needed funds for capital expenditures. But then he went on, of course, to say that they never got any information on what was happening. They did, Mr. Speaker; they got Power Perspectives 1979, which was delivered to every MLA — as a matter of fact, it was made available to a good number of people. It gave an indication to the people of the province of British Columbia what Hydro's power planning was for the future, the various alternative sources of energy and the various Hydro projects which they had made plans for and which they were putting through various engineering studies, environmental impact studies, et cetera. This was made available to the member for Alberni, and to the opposition in order that they could understand the responsibility of B.C. Hydro and the need for the bill that is before the House now, so they could debate the issue, debate the need for the funds, and raise constructive questions.

Unfortunately, because they don't do their research, they wander all over the ball park. They've had that, and I think it's a shame, Mr. Speaker, the Loyal Opposition doesn't take the time to read the information made available to it.

They also received the annual report from B.C. Hydro, which I tabled in this House a few days ago, and was pleased to do so because the bill was coming up; they would have the latest information, the latest annual report they could refer to.

We try to help the opposition so we can have constructive debate. Now the member for Alberni says Hydro's borrowing power in this bill is one-sixth of the

[ Page 302 ]

provincial budget. He makes that statement and, you know, I know reporters wouldn't make that headlines, Mr. Speaker, because he compares apples and oranges. B.C. Hydro is borrowing funds that are really a debt for capital expenditures of power projects. To relate that to an operating annual budget of the province is comparing apples and oranges, but yet it's a good catch phrase. One-sixth of the budget is going for Hydro; make people think that one-sixth of our operating budget is going to B.C. Hydro. It's a poor debate, Mr. Speaker.

Look at the projects: first of all, they received Power Perspectives 1979; they received the annual report of B.C. Hydro which refers to it. Then, in his opening remarks, the Minister of Finance provided the members of the opposition with the list of the capital expenditures that were going to be made; a breakdown, not keeping anybody in the dark, but trying to provide the opposition with information. The Revelstoke project, in the member for Shuswap-Revelstoke's area, the dam proceeding; he knows expenditures have to be made. He knows it is under construction. What do you want to do — shut it down while you refer it to a committee? You know it's there. The capital information is available to you.

The member for Alberni (Mr. Skelly) is upset because he hasn't got the information. He talks about the 500-kilovolt transmission line to Vancouver Island. Crown Zellerbach made a statement yesterday concerning the availability of power to Vancouver Island for development, for industry, for the creation of jobs. Yet they would probably vote against this bill — although I can't understand why — which would indicate that the people on Vancouver Island don't mean anything to you. You don't want jobs over here; you don't want industrial development; you don't want alternative sources of energy. That's wrong. You must realize that these capital expenditures have to be made to provide power to the people.

Let me talk to you about the energy policy. The member for Alberni talked about the lack of an energy policy. He probably doesn't recall that in the previous session in March I referred to the energy policy which was underway. It will be presented in the very near future. It is a comprehensive energy policy. First of all, we created the Ministry of Energy, Mines and Petroleum Resources because energy relates to some of our mining. The member for Prince Rupert (Mr. Lea) nods his head. He knows that coal relates to mining. He knows that coal, natural gas and oil all relate to the energy resources problem. This government put together that ministry.

Secondly, the development of the policy has been a coordinated effort. It has not been a few people trying to determine policy. I've brought in the expertise of the people from the B.C. Petroleum Corporation, the B.C. Energy Commission, the Ministry of Economic Development, B.C. Hydro, and outside consultants. We can have a good cross-section of information. When we do place before you an energy policy, it will be one that we can indicate to the people of the province, to industry, trade and commerce, where we're going in terms of adequate energy supplies, alternative sources and security of supplies, which are most important.

With regard to Hydro projects, I don't think anybody disagrees with the approach that was made by this government in creating the Committee on Crown Corporations. B.C. Hydro and its senior staff members welcomed the opportunity to appear before that committee and to answer questions. There was no hiding of facts. They came forward and they answered questions. I'm sorry, Mr. Member, but they did appear, did they not? And they answered questions for the members of the committee.

MR. KING: That's not what the report said. Read the report.

HON. MR. HEWITT: Yes, I have read the report, Mr. Member. In regard to the comments made about pre-engineering on the Revelstoke Dam and how we got involved with that and how much was spent, the amount of pre-engineering that's been carried on was substantial over the past years and, of course, under this bill, $167 million will be covering some of the costs of construction.

In regard to the expenditure of the $30 million that had to be spent because of engineering investigation after the pre-engineering was done when they did some of the diversion, they found that they had, I believe, some marble or granite outcroppings under the water and identified that, and then B.C. Hydro of course looks on those as costs. They provide for those contingencies in their estimating.

In regard to the buying up of property and moving to another area, which is the Peace River country and Site C, I think it was the member for Alberni who made the comment that B.C. Hydro was going around buying up property, confiscating property. Well, you might be interested in knowing that B.C. Hydro has only dealt with properties that have been offered to it by the owners of that property in the Peace River country.

Interjection.

HON. MR. HEWITT: Oh, well, you're making a statement, Mr. Member. Your colleague from Alberni made the statement that Hydro was buying up all the land. I'm advising you that B.C. Hydro only dealt with land that was offered to them by the owners. As a result, they purchased some six ranches and some 17 small parcels of property from residents in the Peace River country. So when you make statements, Mr. Member, maybe you should do your research and phone B.C. Hydro and get the information, because it is available to you as you know.

In regard to the forecasting that we talk about and have great debates on, B.C. Hydro, of course, have to plan far enough in advance so we don't suffer brownouts or blackouts, so that we can provide power and energy for industrial development and residential dwellings. The ten-year forecast of B.C. Hydro for the years 1978-1988 was something like 6.2 percent average growth in energy requirement. To give you an indication how accurate that is, for the 12 months ending May 31, 1979, Vancouver Island's power requirements were 8.2 percent, and the total system requirement was 6.3 percent.

Whether the economy flattens out, goes down, or grows, there isn't too much leeway for B.C. Hydro, because they must plan for the growth and power requirements to ensure that they don't fall short. If they do, they're the first ones who are going to hear about it.

In regard to the various comments about alternative sources of energy and what B.C. Hydro is doing, I can tell you — and you are aware of it, or you should be, because Power Perspectives 1979 indicates to you the alternative

[ Page 303 ]

sources of energy — that the review of operations for B.C. Hydro in their annual report talks about all their other studies, planning, research and development for alternative sources of energy. It tells of the efforts that they have made with their customers for conservation in this province, their approach to co-generation with industry in this province, their research and exploration drilling for geothermal energy in the Meager Creek area — spending a substantial amount of money — their efforts in solar energy in this province. It's all in this report, and yet you won't refer to it or don't take the time to look at it.

In the research building that they are building in Burnaby, I believe, they are using solar energy right in that building, and doing research on it at the same time. I'm mistaken; it's their research and development centre in Surrey. You might take the time, hon. members, to go out and take a look at it.

MR. LEA: Have you been there?

HON. MR. HEWITT: No, Mr. Member, I haven't been there, so maybe we can go together. I probably am a little busier than you are.

HON. MR. VANDER ZALM: You are welcome to Surrey.

HON. MR. HEWITT: You're welcome to Surrey. The first member for Surrey welcomes you there.

MR. HALL: The second member welcomes you also.

HON. MR. HEWITT: In regard to the nuclear energy comments, again if you look at the annual report you will get some indication that we are so blessed with all the alternative sources of energy that we really don't have to look at nuclear energy in the province of British Columbia. If you look at the capital expenditures list that this borrowing covers, you will also note there are no capital expenditures for nuclear power in that list either. So, Mr. Member for Shuswap-Revelstoke (Mr. King), the nuclear power issue is something you love to dwell on. But you misquote Mr. Bonner when he makes his statements. I think you've had some members on this side of the House tell you that your statements in this House are somewhat misleading. They sat at the Chamber of Commerce meeting yesterday and heard the full text of Mr. Bonner's comments.

If there were opposition to development of the conventional sources of power, if you have more opposition to the conventional sources of power in regard to dam construction, in regard to burning of Hat Creek coal, other sources of energy, what alternative can you look at? In this province we are fortunate enough to be blessed with those alternative sources such as hydroelectric power, natural gas. coal, solar energy, geothermal energy, et cetera. All those are available to us, and we are very fortunate, and very blessed. A lot of countries, provinces and states in the United States don't have the opportunity we have to look at alternative sources of power.

I'd like to comment, too, as Minister of Energy, Mines and Petroleum Resources, on some of the comments my colleague for North Vancouver–Seymour (Mr. Davis) mentioned when he spoke. He stated that we have to move from an oil-based economy. I think that statement should have more impact on the people and the industry of British Columbia. Expand that to Canada and to the United States. If we don't get off that oil-based economy, we're going to find the economy in Canada and the United States slowing down, grinding to a halt. We won't see growth; we'll see a reduction. It's most important that we take the approach, where we have the opportunity, to look to alternative sources of energy such as a natural gas pipeline and a 500-kilovolt line to Vancouver Island. If we can accomplish that conversion as quickly as possible, we will become more self-reliant and self-sufficient in regard to energy in this province.

He also mentioned the need for amendments to the Energy Act because those industries which sell more than 15 percent of their power generation become public utilities and have a number of restrictions placed on them. I agree with you, Mr. Member for North Vancouver–Seymour, that is most important. In the East Kootenays where coal-mining takes place and where there are the waste-coal piles, we need to look at that as an energy source. B.C. Hydro has had that under study for the past year.

The natural gas pipeline to Vancouver Island is under a task force study of my ministry. The member for Mackenzie (Mr. Lockstead) has been concerned about it. The decision is going to have to be made, in my opinion, not just on the economics at this time of that natural gas pipeline to Vancouver Island, but the long-range view of self-sufficiency. We, in my opinion, should be able to look to the federal government for assistance to ensure that we can get a natural gas pipeline to Vancouver Island. I think that's one of the comments that I'll have when I meet my colleague in Ottawa. The west coast should be assisted in such things as availability of power and energy to the off-shore island on the west side of Canada.

The member for Shuswap-Revelstoke (Mr. King) made the statement that Hydro is out of control. This government appointed an auditor-general who could take an independent look at what was happening, not just in government but in our Crown corporations. We set up the Committee on Crown Corporations to investigate those Crown corporations — an independent body, an all-party body — to take a look at our Crown corporations in the province. That party didn't do it, Mr. Minister, but this government did. This government appointed an auditor-general who could take an independent look at what was happening, not just in government but in our Crown corporations. We set up the Committee on Crown Corporations to investigate those Crown corporations — an independent body, an all-party body — to take a look at our Crown corporations in the province. That party didn't do it, Mr. Minister, but this government did.

We have various government agencies that B.C. Hydro has to go through. I've got two pages of them here and I could read them out to you. I just say that there are a lot of controls that are placed over B.C. Hydro. Last but not least, there is government policy that will indicate to Crown corporations, including B.C. Hydro, the direction this province is going in, whether it be in energy or other areas.

Hon. Mr. Hewitt moved adjournment of the debate.

Motion approved.

[ Page 304 ]

MR. SPEAKER: Hon. members, during debate on second reading, I undertook to bring in a ruling concerning a proposed amendment. May I have the attention of all hon. members? This could perhaps be guidance for other reasoned amendments which are proposed in this building.

The amendment says: "That the motion that Bill 11, British Columbia Hydro and Power Authority (1964) Amendment Act, 1979, be read a second time now be amended to delete the words 'be read a second time now' and substituting the words 'be referred to the special committee appointed on June 6, 1979, for consideration.'"

I would draw the attention of all hon. members to our own standing order 83. Standing order 83 simply says: "Every bill shall be read twice in the House before committal or amendment." The motion to amend says that it wishes the bill to be referred to a special committee appointed on June 6, et cetera. "Every bill shall be read twice in the House before committal or amendment."

There was another instance in 1917 when almost precisely this same proposal was made in this House and the then Speaker ruled in this way:

"Second reading is the most important stage through which a bill is required to pass, for its whole principle is then at issue and it is affirmed or denied by a vote of the House. In a perusal of the authorities I cannot find where bills of this character have been committed before receiving second reading, and it would appear that the English practice is quite clear that public bills, such as the bill in question, are not committed until after second reading."

Then on the authority of standing order 83, which says that every bill shall be read twice in the House before committal or amendment, the then Speaker ruled a similar motion out of order. And I so rule.

Presenting Reports

Hon. Mr. Fraser presented the annual report of the Ministry of Highways and Public Works.

Mr. Speaker tabled the audit report of the auditor-general, which is required by statute.

MR. LEA: Mr. Speaker, you took under advisement whether or not a motion that I made earlier today in regard to an emergency debate is in order. I know that it takes some time to look those over. I'm just wondering when I can expect it.

MR. SPEAKER: The decision on that will be coming as quickly as possible.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 5:59 p.m.