[ Page 743 ]

CONTENTS

Routine Proceedings

Children's Rights Act (Bill M 205). Mr. Lauk.

Introduction and first reading –– 743

Industrial Development Subsidiary Agreement Loan Repayment Revolving Fund Act

(Bill 28). Hon. Mr. Phillips.

Introduction and first reading –– 743

Matter of Urgent Public Importance

Use of Picloram herbicide.

Mr. Skelly –– 743

Routine Proceedings

Committee of Supply: Ministry of Forestry estimates.

On vote 117.

Mr. King –– 744

Hon. Mr. Waterland –– 747

Mrs. Wallace –– 749

Mr. King –– 751

Hon. Mr. Waterland –– 753

Mr. Nicolson –– 753

Hon. Mr. Waterland –– 755

Mr. King –– 755

Hon. Mr. Waterland –– 757

Forest Amendment Act, 1979 (Bill 22). Second reading.

Hon. Mr. Waterland –– 758

Mr. King –– 758

Mr. Barrett –– 759

Tabling Documents

British Columbia Housing Management Commission annual report for 1978.

Hon. Mr. Chabot –– 760

Matter of Urgent Public Importance

Use of Picloram herbicide.

Mr. Speaker rules –– 760

FRIDAY, JULY 13, 1979

The House met at 10 a.m.

Prayers.

MRS. JORDAN: In the gallery today is a very charming and talented lady, Miss Irene Dunlop, from Vernon. She is with her parents, Betty and Jack Dunlop, who are visiting with us from Ontario. I am pleased to advise you that we also have Mr. and Mrs. Jack Simpson, from Vernon, in the gallery, and I ask the House to give them a very warm welcome.

Introduction of Bills

CHILDREN'S RIGHTS ACT

On a motion by Mr. Lauk, Bill M 205, Children's Rights Act, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

INDUSTRIAL DEVELOPMENT SUBSIDIARY
AGREEMENT LOAN REPAYMENT
REVOLVING FUND ACT

Hon. Mr. Phillips presented a message from His Honour the Lieutenant-Governor: a bill intituled the Industrial Development Subsidiary Agreement Loan Repayment Revolving Fund Act.

Bill 28 introduced, read a first time, and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

MR. SKELLY: I ask leave under Standing Order 35 for an adjournment of this House to debate a matter of urgent public importance.

MR. SPEAKER: Would you please state the matter?

MR. SKELLY: The matter involves action by the government yesterday which removes virtually all restrictions under the Pesticide Control Act on the application of the pesticide Picloram on private property. An order-in-council passed by the government will be registered today momentarily, and it will be possible for unrestricted spraying to proceed within hours. Because of its dangers to human beings, and to the environment, the use of this chemical is carefully controlled on public lands, as shown in pesticide control permit No. 102-80 to 87-79, which I will make available to Mr. Speaker. Yet changes in the pesticide control regulations will allow almost unrestricted use of the chemical on private lands, which include most of the populous areas of the province.

A recent incident involving unregulated use of Picloram on a Penticton Indian Reserve resulted in a drift of the herbicide to neighbouring properties in the West Bench area, and people have now been warned against eating fruits or vegetables grown in the area because of potential danger to health. The new government regulation to take effect momentarily will increase the frequency of these incidents and the danger to the health and safety of people throughout the province.

A Pesticide Control Board hearing, Mr. Speaker, is to be held in Smithers on July 19, at which time it will be determined whether or not a pesticide control permit for projects 102-80 to 102-87 on public lands will be allowed. A pathologist from the National Cancer Institute in Frederick, Maryland, Dr. Melvin Reuben, will be testifying at that hearing against the use of Picloram because of the fact that it causes cancer.

Surely the regulations should not be changed to allow unrestricted use of a suspected carcinogen on private lands in the same area and at the same time that the safety of this chemical on public lands is being debated before the Pesticide Control Appeal Board. The government's action in changing the regulation makes a mockery of the appeal, and shows its contempt for the appeal board and the rights of the appellant. Because of the fact, Mr. Speaker, that the regulations will take effect momentarily, and because of the probability that spraying could begin within hours....

MR. SPEAKER: Order, please, hon. member. I would warn that we should perhaps follow the long-standing pattern in this House that statements made be rather brief. I trust the member's nearly concluded.

MR. SKELLY: This one is about to be terminated, Mr. Speaker.

Also, because of the fact that the regulation was held back until after the minister's estimates and could not be debated at that time, I would urge that Mr. Speaker consider the urgency of this matter immediately so that the Legislature may act as soon as possible.

MR. SPEAKER: I would make two observations, hon. members. First of all, I'd like to thank the member for advance notice of this particular matter. It does give the Chair an opportunity to look at the urgency of the matter and see whether or not it does qualify.

The second is that whenever we ask leave to present a matter which would warrant the setting aside of the regular business of the House for the discussion of the matter purported, it is not in order to debate the matter in the statement of the matter. I would encourage all members to make their statements as brief as possible so as not to establish new precedents in the House.

Concerning the matter, there are one or two areas that would immediately and perhaps out of hand disqualify the matter under standing order 35. I would suggest that, in the first instance, it does import an argument. But in order to be certain of that, I would like to review the precedents that have been established. I will reserve my decision and bring the decision to the House without prejudice to the member's position in this debate, and perhaps even before the House adjourns today.

Interjection.

MR. SPEAKER: Hon. member, in explaining whether it is argumentative we may well get into the argument itself. I would warn against it. Perhaps if the hon. member could sit together with the Speaker, we could give proper consideration to all of those matters.

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Orders of the Day

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

HON. MR. GARDOM: We'd all like to officially welcome back from his trip the leader of the official opposition — black patch, Hathaway shirt. Did you have a good time in the Golan Heights?

MR. BARRETT: Shalom.

ESTIMATES: MINISTRY OF FORESTS

(continued)

On vote 117: minister's office, $115,544 — continued.

MR. KING: Yesterday I called for an investigation into the monopoly over the forest resource by the eight major integrated firms in British Columbia. I outlined that there is information available which, in my view, demonstrates beyond any question whatsoever that we have a scandalous misuse of the resource, that the minister is aware of this, and has thus far failed to act on it.

That information, Mr. Chairman, reveals that in 1977 a saw log appraisal project done by Forest Service scalers and graders showed that for pulp mills as a group, over 30 percent of all logs used were premium-grade saw logs. One operator, Rayonier, was consuming well over 50 percent sawlogs in its supply of pulp mills. At the same time that was going on, pulp logs were being left in the slash, and, of course, mountains of chips were going to waste by independent sawmillers who could not find a market for their chips. That is a tremendous waste and a tremendous loss of revenue to the Crown. It's a tremendous loss of production in the industry itself and, of course, it's a frustrating and extremely aggravating situation to face for independent operators in British Columbia.

At the same time that a major integrated company is allowed to abuse the resource in this way, small independent mills all over the province are being denied access to an adequate supply to maintain their production. There is little wonder that they are complaining to the opposition and to anyone who will listen to them about the discrimination they are receiving at the hands of this government.

I revealed that in 1978 another professional analysis extracted data from the files of the minister. It showed that the eight major companies controlled all tree-farm licences on the coast, and they undercut the allowable cut allocated to them by an average of 947,267 units per year — and this was in the six years ending in 1977. They undercut their allocation by 947,267 units. Mr. Chairman, that is a major scandal; that is a major abuse and waste of resource and production in British Columbia. The failure to harvest a resource of those proportions indicates a loss of timber that would have supplied 9 medium-sized sawmills and about 15 logging operations. It reveals a loss of up to 12,000 jobs in the forest industry based on the actual sawmilling and logging and so on, as well as related services. It indicates a loss of revenue in the area of up to $38 million a year — both in terms of direct revenue and the loss of stumpage to the Crown. I want to know why the minister is allowing this to go on. Now this is a limited amount of data; there is undoubtedly more data which demonstrates that this kind of scandalous abuse is taking place on a pretty wide scale in the province of British Columbia.

Now while that was happening, Mr. Chairman, a new Forest Act was brought in, and the minister, rather than testing the practices and the logging plans and the performance of these eight major integrated firms, provided in the new Act that they have almost automatic renewal of their tenure. They have extended tenure, entrenched monopolization and greater control. They did not have to come before the minister and justify proper utilization; they did not have to justify their operation on the basis that adequate jobs were flowing from the exploitation of the resource. They apparently did not have to justify high efficiency that would produce maximum return to the Crown. My question to the minister is: why not? That is the standard and those are the criteria demanded by the minister for the small business sector.

I indicated yesterday — and I want to remind the minister again — that under division 2 of the Act, relating to forest licences, there are criteria laid out to be considered when bids are received from independents for public timber. Those criteria provide in section 11: "The chief forester shall evaluate each application, including its potential for (a) creating or maintaining employment opportunities and other social benefits in the province, (b) providing for the management and utilization of Crown timber, (c) furthering the development objectives of the Crown, (d) meeting objectives of the Crown in respect of environmental quality and the management of water, fisheries and wildlife resources, and (e) contributing to Crown revenues. "

Now how can the minister justify imposing this test on independents who bid to use Crown timber while completely ignoring any such test and standard with respect to the eight large, integrated firms whose tenure on excessive supply he has extended to what I believe is a perpetual basis. That is an abuse and that is a scandal and that is discriminatory against small industry in British Columbia. It's discriminatory against British Columbian businesses who would like to get a piece of the action and those who are already in the industry and would like to stay in operation. It completely repudiates any conceivable or any suggested dedication to the principle of competition. It repudiates any competition in the industry.

I have outlined how the big integrated firms have such an excess supply that they are able to bank that supply for the future. They are not utilizing it. They're holding it in reserve. They are manipulating the records of their actual cut in each year. These are serious allegations and they are borne out, Mr. Chairman, by the minister's own records. He sits by and glibly says: "Well, we're going to do something for the small business people too. We're going to develop a set-aside program and provide some timber for the small independents. " My question to the minister, Mr. Chairman, is: when? There are eight small mills in the East Kootenay area that have been waiting for a whole year for a firm timber supply, and they're teetering on the verge of collapse now.

Here's another conflict or inconsistency in the minister's approach to administration. When it comes to the eight large, integrated firms in British Columbia, he says: "Well, they have to have a firm supply of timber in order to justify their capital investment. If they don't have a long-term tenure, they're not going to invest; they're going to pack up

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and leave the province." I'm not opposed to some tenure; I'm not opposed to reasonable tenure for the large, integrated firms. Yes, they have heavy capital investment. But I want to suggest, Mr. Chairman, that they do not need monopoly control. They should have to compete in the open bidding system for at least a portion of their supply. They don't need 100 percent of their needs guaranteed to them. Above all, as demonstrated by the minister's own records, they don't need in excess of their maximum supply — which they are enjoying now. That is pandering to the large, integrated foreign-controlled firms in British Columbia.

The minister's a captive. He appears to be a eunuch in terms of any realistic commitment or ability to come to grips with this abuse. He makes statements that they're going to have to manage it — use it or lose it. What a sham! At the very time he is uttering those statements, he is further entrenching their control and their tenure. When they come to him for renewal of a tree-farm licence, they don't even have to justify that licence renewal in an open public hearing.

The minister denies the need for an open public debate as to whether or not they've been efficient, as to whether or not they have an oversupply, as to whether or not they have followed adequate utilization programs. None of those things can be debated in an open public forum.

MR. COCKE: Mr. Chairman, I draw your attention to the quorum.

MR. CHAIRMAN: The Chair's attention is drawn to a quorum. Hon. members, under standing orders, when the attention of the Chairman is drawn to the fact that the House may lack a quorum, the Chairman is duty-bound to make a list of those members that are in the House at the time. I shall do so now.

In order to ensure that we have a quorum I shall ring the division bells.

There would now appear to be a quorum, hon. members. I invite you to proceed.

MR. KING: I was pointing out that there are two standards used by the minister and this government when it comes to treatment of the forest industry in British Columbia. The large integrated firms which demonstrably have been abusing the resource allocated to them are provided with automatic rollovers of the tree-farm licence without public hearings, without the opportunity for interested people in the industry, the public, environmental groups, and so on, to question the adequacy of that particular licensee's performance. The minister passively allows this licence granting increased tenure to be renewed in the secrecy of his office without the benefit of public discussion as to whether or not that licence should be renewed, or whether or not there should be any change in the volume of the allocation. This is inadequate. This is the kind of procedure which lends itself to charges of impropriety in the handling and the allocation of the forest resource. It's dangerous; it's unhealthy; and, Mr. Chairman, it is an indication that this government has no intention of allowing the light of day to shine in on the administrative decisions which govern the control and the awarding of our number one resource in the province of British Columbia.

That's bad in itself; it's a poor procedure in itself. It's a dangerous procedure, but beyond that, when it's contrasted against the procedures and the methods for dealing with the small, independent logging concerns and sawmilling concerns in British Columbia, it's totally discriminatory. They are charged, as I've indicated, with proving efficiency, proving high utilization, proving that they're going to create adequate employment, and proving, of course, that they are going to provide an adequate return to the Crown. Those standards are not apparent in any consideration of tree-farm licence rollovers. They are carried out in the secrecy of the minister's department. I say that is completely unacceptable.

The big firms say: "We need long-term guaranteed security in order to stay in business in British Columbia." I buy that. Give them 70 percent of their annual allowable cut requirements: let them compete on the open market for 30 percent of their fibre needs. What's wrong with that? You people portray yourselves as free enterprisers. Do you not believe in some competition in the industry? It would establish some proper value for our timber resources through the market system rather than by an artificial formula set by the ministry. What's wrong with that? And if it's necessary to give that kind of questionable tenure to the big integrated firms so that they can justify their capital investment, what about the small guys? By the same argument, do not the small enterprisers in the forest industry need some security too? What of their capital investment? What of their future? That's totally ignored.

Up in the East Kootenay area, the minister has been promising that the mills would receive some timber through the small-business program. They have yet to see any progress in the development of that small-business program. I believe I've got some information here on the situation up in the East Kootenay as I understand it. I'm certainly not a professional forester, nor have I had a great deal of experience in the forest industry; but I am trying to relate to this Legislature the concerns of people in the independent sector who have provided me with the information and asked me to put it forward in this House. In the Creston forest area there is a total annual allowable cut, as I understand it. of about 103,000 cunits — that is in the PSYU — and I believe that the licence-holders hold about 49,660 cunits of that amount. There is an excess of 52,340 cunits. Under the old Act, of course, only the licence-holders were allowed to bid in this area.

I suggest to the minister that, if he looks at the standards that are required of the small business people in terms of providing employment and of efficiency, he has an obligation to make a comparison between the benefits which flow from their operations and those which flow from the larger licence-holders. What is the experience in terms of job creation? Who needs the most timber to create a job? Well, the claim is that the small independents produce one man-day job for every 2.5 cunits of wood which they receive, and that the large licence-holders require 8 to 12 cunits of wood to produce one man-day job. That indicates that the small, independent firms are much more efficient and much more beneficial in terms of meeting the standards which the minister says he is dedicated to.

If you are obtaining that kind of utilization out of the product it follows that the revenue to the Crown is maximized. It follows that the general profit from the resource is optimized in terms of the economy of British

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Columbia. But while the small firms are being asked to wait until sales may be put up for them — and I understand that in 1979 in that area there have been only two sales of available timber for eight or ten small mills to try to compete for and find their supply from....

The minister and his staff have promised that there will be further material provided, but they haven't got the small-business program in place yet. At the local level they say: "We haven't got the budget to prepare this sale. And if we take money from our budget to prepare this sale we may have to remove it from our fire-prevention program, or something else — perhaps our replanting program." The minister didn't hesitate to provide a budget for the automatic rollover of tree-farm licences for the majors. Where is his budget and commitment for providing an adequate allocation to the independents? It would appear they are the poor cousins of the forest industry.

There is a suggestion that some timber is going to be freed up and some sales put up after the ministry has done the necessary technical work to set aside some timber in the Creston management area. All the indications that my friends in small business have are that the technical work and preparation by the ministry are going to hold up any sale until November of this year. Once November rolls around, of course, you are into winter in the East Kootenays. particularly as those sales are going to occur at a very high elevation. They can't log. So that means that the first real opportunity that these small independents are going to have to actually harvest any of this timber, which may be made available to them, will be next year after the breakup in June. They have already been a whole year without supply, operating on a shoestring, having to salvage off right-of-way clearing, and having the ludicrous situation of a sale of about a hundred trees.

Contrast that treatment of the independents with the minister's cap-in-hand subservience to the eight big, integrated firms, to whom he has delivered monopoly control of the major resource in B.C. The small independents have to scratch, borrow and beg to try and stay operative, and the minister hands over excessive supplies to the majors, which they demonstrably cannot use and are not using — according to the Ministry of Forests figures. That's the story, Mr. Premier. That is the story that comes to this Legislature. It's not manufactured by me, but it's provided to me from people in the industry who are concerned and tired to death of the discriminatory practices of this Forest Service. The member for Kootenay (Mr. Segarty) should be extremely concerned. It's his riding I'm talking about.

There are mills at Yahk, British Columbia, that are hanging in the balance. They're not large firms; in total they employ about 55 people. But 55 people means a great deal to the economy of a very small and depressed area. The member for Kootenay seems to think that's humorous. If he feels that my figures are wrong or if he feels that it's not important to the economy of that area, then certainly he should get up and speak on it; it's his riding. Does the member for Kootenay think this is fair treatment'?

MR. CHAIRMAN: Order, please. I must remind the member it's the estimates of the Minister of Forests that we are involved with today.

MR. KING: Yes, I know, Mr. Chairman, but I think we need a new one. For the present time, I guess, we have to live with the minister we have.

What about stumpage rates for the independents as compared to the licence holders? I am told that the licence holders, like MacMillan Bloedel, pay stumpage of $2.20 on cedar.

In Idaho the stumpage on cedar is between $180 and $250 a cunit. MacMillan Bloedel, I am told, pays $2.20 stumpage. The small independents up in the East Kootenays don't receive the same stumpage rate as MacMillan Bloedel. I'm told they pay about $100. If these figures are not correct, I hope the minister will get up and challenge those figures and correct them. This is my information.

Why is there discrimination? On the one hand, the large integrated boys are receiving excessive supplies. They don't have to come back and justify proper utilization, proper efficiency; they get automatic licence rollovers, in secret. They receive preferred stumpage rates from the ministry. Why the preference?

From the stumpage rates in British Columbia, the licence holders are allowed to deduct the cost of road building. They are allowed to deduct machinery costs related to road construction. In terms of accounting, they are even allowed to — and do, in fact — deduct from stumpage the cost of office supplies and secretarial help. The premise is that once the logging operation is complete, those roads will revert to the Crown and be of some benefit in terms of access by the public, access for fire prevention and replanting and so on.

The fact of the matter is that there is inadequate policing of road construction. Many of these roads are charged to the public and deducted from stumpage. When they are turned over to the Crown, they are inaccessible. They had not been engineered adequately; they have not had adequate culverting and are of little or no benefit in terms of access. That is an abuse, because it is not adequately administered and policed by the ministry. The small independents don't have any of those loopholes and escapes — none at all. This is a major scandal. This is a major sham. This is a denial of any free competitive enterprise in the forest industry. It is highly preferential treatment to the licence holders in British Columbia. I don't know why. If I were cynical I would say it may be related to campaign donations. But not being a cynical person, I think it's more that the minister lacks the commitment and the understanding to identify the problems and to take decisive action to remedy those problems; I prefer to think that's what it is. But no matter what the reason, the consequences are the same. We're stifling and denying potential production in the forest industry of British Columbia. Through handing over monopoly control in a subservient fashion, we are failing to enjoy and appreciate the job creation that's potentially available, to say nothing of a major increase in revenues to the Crown. The minister hasn't really done or said anything that adequately responds to these very, very serious allegations.

In conclusion, Mr. Chairman, let me read a little notice that was put in the paper up in the Kootenays. I'm not sure of the date; it was some time last year. It says: "Publication No. I by the Kootenay Secondary Mills Association, Box 516, Creston, B.C." It's a little notice....

MR. CHAIRMAN: Hon. member, excuse me. Perhaps we could have an intervening speaker. The time under our standing orders....

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MR. LEVI: Mr. Chairman, I was going to ask the Minister of Forests some questions, but I think I will wait until after my colleague has finished.

MR. KING: Mr. Chairman, I want to demonstrate to the minister that I'm not out on some political kick to crucify him, I'm trying to genuinely reflect the information I've been receiving. These people who are providing this, information to me are certainly not political. I indicated yesterday some of them are Social Credit; some of them are very prominent Social Credit people. They're not on a political kick either. They're genuinely troubled, and this is what they tell me is going wrong. But in this case, here is the notice that was put in the public press. It says:

"Timber Tax Loss.''

"Tax lost to Creston-Kootenay region was approximately $3.5 million per year during the past years. It is toward this direction that the small businessmen's association has been formed to let the Canadian people know of the unjust business practices that have been committed in the past and are still being committed today. It is the tax loss that all Canadians must know about, as described in the following table."

It shows the years 1975, 1976 and 1977 — stumpage paid for Crown timber, people-owned. The large-quota mills paid $2.21 in 1975; in 1976 they paid $2.28; and in 1977 they paid $1.83. They harvested 78,986 cunits in 1975; in 1976, 99,471 cunits; and in 1977, 99,087 cunits.

"True market value for harvested timber stumpage is approximately $30 to $80 per cunit, with a suggested average value of approximately $40 per cunit. Accordingly, quota mills paid in 1975, $174, 511; in 1976, $226,500; and in 1977, $183,684. "

The allegation is that they should have paid far in excess of that amount, and I'm not going to read the figures. I'm going to table this article in the House, Mr. Chairman, so it will be available to all members, and I'll summarize it rather than going into complete detail on it.

The article continues:

"Recently on radio, sawmill representatives announced approximately 500 jobs were made by them. Through simple arithmetic Canadians can see that if you paid a man $1 per day, the unpaid taxes per year would pay for approximately 30,000 man-days.

"Small businessmen today have paid stumpage rates for Crown timber of $40 per cunit and more to the Forest Service. Small business is willing to continue to pay a true market stumpage value for Crown timber. However, small business has been denied access to this Crown timber at any price. Instead the Forest Service gave the timber sales directly to the Creston quota mills for approximately $2 a cunit. This is an unjust giveaway program of Canadian people's resources. Do yourself a service and find out the truth. "

Mr. Chairman, that completely confirms and supports the things that I've been saying in this House since the minister's estimates came to the floor. I have not had a satisfactory or adequate response from the minister. We're talking about abuses that involve millions of dollars, a great number of jobs and, above all, some fairness and some competition in the industry.

I want the minister to respond in a meaningful way. I want him to tell this House what he's prepared to do, rather than saying: "Oh, well, somewhere down the road, if they don't perform, we're going to take it away. " Mr. Minister, the evidence is clear. There has not been performance. Why haven't you taken it away? Why haven't you treated the large integrated firms in the same fashion that the small people are treated? These are the questions that I want the minister to address himself to.

HON. MR. WATERLAND: Mr. Chairman, the member for Shuswap- Revelstoke has again gone over many of the things he talked about last night. I did respond to most of it last night. He has brought up a few new areas, though, and I'll make comment on those.

He mentioned the abuse of sawlogs by running good-grade sawlogs through chippers at pulp mills. About two years ago when I became aware of this, as the member knows.... He referred in part to a summary, I believe, of the results of that initial investigation we made. At that time I established what we called a flying squad of scalers which could drop in unannounced at all and any sites which were under suspicion of abusing sawlogs, and indeed we did find in some cases, and in one particular case, that a large percentage of material going into the wood rooms was capable of being used for other purposes. In some cases we identified reasons for it, and in most cases, excuses. We've taken steps to see that this doesn't happen. A great deal of reshuffling or moving of logs around to get the right log to the right jackladder has taken place since then. This abuse has dropped substantially.

In any event, we are continuing that type of investigation. The abuse as it was has been reduced substantially. There are still sawlogs, on occasion, going to wood rooms, but then a sawlog is not the same for one company as perhaps for another. We can't afford to have good-grade logs being ground up for pulp chips and it's not being permitted. We are keeping a constant monitor of the situation and it is improving substantially. There is room for additional improvement and we're continuing to force that to happen.

The member, I think, is somewhat confused on just what forest licences are. He's referred several times to terms and conditions that have to be met in allocating forest licences. The forest licence tenure form under new legislation will probably amount to something in the order of 50 percent to 60 percent of the total timber allocation in the province. A forest licence is a fairly long-term licence. It has a maximum tenure, I believe, of 21 years; most of them would be for 15 years. They are available to all sizes and types of companies. In the Interior it will be our major form of tenure. The licences for the small-business program we will call "timber sale licences," but it will be a different type of timber sale licence than the old timber sale licence.

The member mentioned — and it was rather a serious charge — that he has evidence of licensees manipulating their cut-control records. Now that is a very serious matter. If the member can bring to me any documented evidence or even great suspicion that this is in fact happening, I would certainly like to hear about it, because that is a very serious matter. If he has evidence I'd certainly like him to bring it to me so that I can check it out and, if necessary, take very

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severe action. We have no indication that cut-control records are being manipulated. I think perhaps he is referring more to changes in allowable cuts in tree-farm licences at periods of time, and that's a different matter. Of course, we have a great deal more authority now under the new legislation to be sure that the allowable cuts calculated for tree-farm licences are, in fact, realistic. We are devoting a great deal of staff time to just that at the present time.

The member mentions that there are different standards of management required for small versus large companies, and that there are different rates of stumpage for small versus large companies. The high level of forest management we require is the same for all companies, regardless of what size. The enforcement is the same, as far as I'm concerned, for all companies. Again, if the member can bring me evidence of discriminatory practice by members of the Forest Service staff, I'd be very happy to receive details rather than generalities. Specifics can be attacked; generalities are difficult to deal with.

He mentioned the labour input of the small operator versus the large operator and, yes, it's probably true that the smaller mills are more labour-intensive. But labour input is also a reflection of the cost-efficiency of an operation. Our forest industry, of course, is competing in a pretty vicious international marketplace. We have to have companies that can compete in that marketplace.

The small company, who usually is a specialty operator, does have more input and he is into a different market — a rather limited market — and there is certainly a place for him. We are going to ensure that continues. But I don't think we can say that because a company has a low labour input they're bad. They're probably an efficient company in terms of productivity, and we need that to keep a competitive forest industry in British Columbia.

He said somebody in the Forest Service staff had said there was no budget for the small-business program. Well, we do have a very adequate budget for the small-business program. Probably what was being referred to was the cost of developing areas for the small-business program. This year the sales we'I be putting up will be adjacent to existing access so that they can be put up immediately after we have the program in place when our amendment is passed. As soon as that amendment is passed we have to advertise these sales for 30 days, and we will begin to advertise immediately. These sales will be underway this year, but they will be adjacent to already developed timber. In future years, we will have to, as a Forests ministry, develop roads to provide access to the sale areas for the small-business program, and at that time we'll have to have moneys allotted in our budget for it.

The member went through comparisons in stumpage in Idaho and British Columbia re the circumstances and the conditions. What stumpage means in the two areas is so different that it's like comparing apples and oranges. The comparison is really meaningless. He also said that MB is not paying the same stumpage as operators in the Kootenays. Well, that's quite right; they're not. MB doesn't operate in the Interior. They operate under different conditions with different types of wood — in different circumstances completely — than the Interior does.

But for the member's information, in the year 1978 the average stumpage paid by a tree-farm licence holder — this is just a lumped average for all the tree-farm licences in the province — was $12.70 a cunit. In the same year the average stumpage for a timber sale licence and timber sale harvesting licences was $13.06 — about 36 cents difference.

You can take examples of places where there appears to be a lot higher stumpage, and in the latter part of 1978 stumpages went up rather remarkably. The reason that some of the smaller sales appear to have a higher stumpage is because of the bonus-bidding procedure that has been used in the past. It's across-the-table bidding, and I think that in the future we should be leaning more toward sealed-tender bidding to get away from the passion of this confrontation across the table which bids, in some cases, the bonus up to determine who gets the sale. It bids it up to a point where nobody can afford it. I think a sealed-tender bidding system is much more reliable. The one bidding is usually the small guy bidding against the small guy.

We have requested, and in most cases larger corporations have agreed that they not get involved in these small sales. They recognize we want them to be for the small guy. When we get our small-business program, as per the new Act in place, the large companies will not be able to bid against the small companies; we can separate the different classes of small company, besides.

The same stumpage formula basically that was in place, which was brought in by the former government, is in place now. There's no discrimination within that as to size or type of company. The stumpage formulas are rather straightforward. They're quite complicated when it gets down to specifics, but road allowances and other cost allowances are factors that go into determining stumpage. It isn't deducted from stumpage, but it's one of the criteria which we, of course, have to use to determine what residual value is there that we can call stumpage.

There really are no differences. The small companies obviously approached that member. I'm sure they approach every member in the Legislature. They approach me constantly. We are moving very rapidly, and we have accommodated them in every possible way we have been able to. I have a great deal of sympathy for them. As I mentioned yesterday, now we have tools whereby we can really provide the with the protection they need. We do need the small operators; we do need the large operators. We must have a proper mix, and the objective of my ministry is to achieve that proper mix of company size and degree of diversity.

That, I think, very well covers the points brought up by the member, Mr. Chairman.

MR. KING: On a few brief points, Mr. Chairman, I was not charging discrimination by the forestry staff. I am charging discrimination in terms of the policy direction which the minister is responsible for. I think it is discriminatory when you have that kind of variation in stumpage rate. To say there are reasons for that kind of wide disparity in stumpage rates between the coast and the Interior is, in my view, unacceptable.

If anything, Mr. Chairman, the Interior poses more difficult and more expensive problems in terms of reaching the timber, distances involved, and the terrain, than are experienced on the coast.

The other handicap that people in the Interior have, of course, is that they're not dealing with timber of the same size. It is generally much smaller timber than grows on the coast, and, of course, usually at a very much higher

[ Page 749 ]

elevation. So, in my view, the cost of harvesting it is infinitely higher. To suggest the kind of disparity which we see between $2.20 for the big integrates and about $40 for the small independents in the Interior is, in my view, discriminatory. That has nothing to do with the minister's staff going out; it has to do with the minister's own policy — his control over and political direction to his ministry. Similarly, to say that there is no relationship between stumpage in Idaho and British Columbia, that we are comparing apples and oranges, is a copout. Sure, there are major differences, and I am aware of those; but I suggest, Mr. Chairman, that those differences do not justify a disparity of $2.20 stumpage for cedar products in British Columbia and $180 in Idaho. The minister's response there is unacceptable and, in my view, just plain ridiculous.

I want to reiterate that what is needed is a major independent investigation of the allegations that have been made by the independents — not just in one area of British Columbia, but through the length and breadth of this province. I hope that the minister will reflect upon it, and I hope that some of his own members will start to exert some pressure on behalf of their own constituents and on behalf of the health of the forest industry in British Columbia.

Sure, we need a proper balance and mix. What I'm saying to the minister today, Mr. Chairman, is that mix is totally out of balance and totally distorted, and the minister will not address himself to that underlying problem. He simply seeks to apologize for it rather than to offer any meaningful remedies, or any commitment to even recognize it and do something about it.

In terms of coming to him with the evidence, that's the old political double shuffle. Serious charges have been made with respect to manipulation of inventory and annual allowable cut. The Thomson report should be released to the public. If the minister says he lacks evidence of this kind of improper manipulation, he should release the Thomson report. He should release the data which was compiled by that consulting firm on the basis of a scrutiny of his own departmental records, and, above all, allow some open scrutiny of the data that he has on file. Perhaps also, Mr. Chairman, he would consider allowing open public hearings when it comes to the rollover of major, long-term timber licences in this province. That's what is needed.

I rather despair of any real change under this minister, because I haven't found that he is prepared to be really consistent and devote himself to creating some competition. The best way of getting the proper mix and balance, Mr. Minister, is to open up competition.

When he talked about some of the small ones he said that, sure, they may create more jobs through timber utilization, but they may not be as cost-efficient. Well, Mr. Chairman, I thought this minister believed in free enterprise. If they're not cost-efficient, they're going to go down the tube. But they should have the chance to compete. What does the minister care, so long as there is an adequate return to the Crown and the industry is job-intensive. If they're not cost-efficient they're not going to make it. That's what free enterprise is supposed to be all about; that's what competition is supposed to be all about; and that's what this government says it is dedicated to.

You've got one standard for the small guys and quite another for the big ones. Do you ask Rayonier if they're cost-efficient when they're shovelling premium-grade sawlogs through their pulp mill? Is that cost-efficient from your point of view, Mr. Minister? I know we are talking about two different things, but the principle is the same. You set one criterion for the big guys and say: "Oh, we've got a flying squad going around and things are getting better." We don't need a flying squad, we need a minister with some gumption who is prepared to say: "Look, I'm taking it away from you." What have you taken away from them, Mr. Minister? When was the last time that any penalty was imposed on one of these big, major private licence holders? Have you taken away any of the resource that they have failed to utilize? I defy you to stand up and give one instance of doing that.

That's not the story when it comes to the small ones. There is vigorous enforcement of forestry standards when it comes to the small ones. That is discrimination, and it's not discrimination at the whim of the staff. That is discrimination which flows from the policy direction of this minister. He is the guy who is responsible. Mr. Chairman. He refuses to address himself to the problems, and I guess he's going to be here awhile until he's prepared to do so.

MRS. WALLACE: I thought perhaps the minister would like to respond to the member for Shuswap Revelstoke.

I've been listening to this debate with great interest, and waiting for the minister to give some meaningful responses to the arguments that have been put forward by the opposition. But it seems that we have a minister who somehow thinks that he's doing a wonderful job for the forest industry. He's talking about the increase in his budget, and so on. He's talking about his reforestation program, and yet his budget increases have amounted to a much smaller increase than even the infringement rate. So in actual dollar value, he's putting less money into the forest industry than has been put into it in previous years. I think that to tell us he's doing such a great job in investing so much money in the forest industry is certainly far from accurate.

The reforestation program is something that is getting some increases, but if you look at it dollar for dollar, and certainly if you look at it compared to the need, it's far short of where it should be. Really, that is what this debate is all about today. We just don't have enough wood in British Columbia. Because of this minister in his wisdom and this new Forest Act by its proclamation. there has been a decision by this government that because we're short of wood, the major companies in this province will get what is there and the little independents will be put out of business. That's exactly what is happening, Mr. Chairman. That's exactly what the opposition forecast would happen under this Act, and now we have ample evidence that this is the case.

The stumpage rate is an area that's been canvassed very well and very thoroughly by my colleague, but there have been no adequate answers to that. A small independent simply cannot compete with a major corporation with that kind of disparity between the rates that they are required to pay, the kind of credits that they are allowed to get and the kind of rates and credits that go to the major corporations. Not only that, but nobody knows what the major corporations are paying or what the special arrangements are, because it's all done behind closed doors now as a result of this new Forest Act. There are no public hearings, no public disclosures: it's all behind closed doors. That is certainly

[ Page 750 ]

not in the interests of an open government; it certainly isn't in the interest of this province, and it isn't in the interest of this province's number one industry.

I was very interested in the comments that have been brought forward on this floor that Rayonier is using something like 50 percent of sawlogs to produce pulp. The minister knows full well that Rayonier has a plant in my constituency that they're going to close down. I've discussed this with the minister. They're going to close it down because they don't have enough logs to operate, and 320 people will be put out of work. Yet that same company is putting sawlogs at the rate of 50 percent or better through a pulping process. That's not forest management, that's forest mismanagement and forest destruction. That's exactly what is going to happen to our forest industry and to our small operators. They will be destroyed by this Minister of Forests.

Interjection.

MRS. WALLACE: I know the plant that I'm speaking about on Vancouver Island is an outdated plant, but it's a plant that could be brought up to standard if there were logs available. That minister has refused to make Crown land available to that plant. He's refused to take any action that would encourage an exchange of logs or a provision of logs for that mill. I tell you that when a plant that employs some 320 people closes its doors in an area like Lake Cowichan, it has a pretty rough effect on the village and on the community. That represents something like 50 percent of its labour force. Certainly it's not going to bode very well for the future of that community.

I am interested in the Forest Act, which, in Part III, division 2, section 11(4) on forest licences, says that "the chief forester shall evaluate each application...." And it sets out some of the potentials that should be considered at that time. The chief forester, of course, is this minister's representative and he's doing only those things that this minister instructs him to do — because he's the top-ranking official; he's really the chief forester in this province.

One of the criteria is that those forest licences should create and maintain employment. When you allow a company to close its doors because you can't provide wood for that company, then that is certainly not creating employment — particularly as I learned that same company is making pulpwood out of good sawlogs. That disclosure was quite a surprise to me, Mr. Chairman, and something that I think this minister should put his mind to.

You don't maintain employment opportunities by putting independent loggers or small mills out of business either. It has been pointed out that they are much more labour-intensive than are the large mills, that they provide many more man-days of work per cunit of wood than do the large operations. Those are the job-creators, and yet they're going out of business because there is no wood being provided for them.

Somehow it seems to be very easy to ensure that the large majors have the wood and it seems very easy to tie up those contracts behind closed doors. But it seems very difficult to provide any timber whatsoever for small, independent operators. Certainly the social benefits to the province would be much more far-reaching if, in fact, the timber resources were used in such a way that they provided our small businesses here in British Columbia with an opportunity to survive. Not only does it create more employment but it also ensures that those financial returns to those companies stay here in British Columbia rather than being exported out in the form of profits to shareholders all around the world. Those small independents are British Columbians working for British Columbia, and the profits that they make stay in British Columbia to stimulate the economy. So from a social point of view it's much more important that those independents stay in operation.

He talked about furthering the objectives of the Crown, Mr. Chairman. If you can obtain a net of $40 from an independent for stumpage as compared to $2 or $3 — or even $12, if we use the minister's average figure — from a major, because of the kind of concessions that the major gets, I'm surprised that minister can stand up and tell us that they all get the same kind of treatment. I certainly don't understand that at all. My understanding is that the majors do get concessions for road-building, for use of their equipment and for almost every expense they have, whereas the small operator does not get that kind of concession. If I'm wrong, I'd like the minister to file evidence with this House that is incorrect. Certainly that's the way the small operators see it, and that's certainly my understanding of how the thing operates. I've never heard of a small independent getting an allowance off his stumpage bid in order to build a road. The dollar return to the Crown is something that has to be considered. I'm surprised that this bottom-line government and this bottom-line minister don't consider that, because he's bringing more dollars into the treasury if he lets that timber go to the small operator.

When he says that you have to maintain jobs with the large majors because you've got to keep that business operating, it proves to me that's where that minister's interest really lies. He said that we have to have a proportion of small operators and large operators. Well, if he really believes that, then he'd better do something to keep those independent operators in business, because if he doesn't they're going to be out of business. I think that minister is quite aware that there just isn't enough wood to provide all that the majors would take and still keep those independent operators in business. There isn't enough wood for the next 20 or 30 years here in British Columbia to ensure that happens. If this minister doesn't take steps to ensure that happens, to make absolutely, positively certain that those independent operators get the kind of timber that will enable them to keep in business, they're going to be gone and that balance that minister talks about is going to go down the tube.

I think, Mr. Chairman, that our major industry here in British Columbia has been saved by the fact that we've had the dollar difference, which has allowed the major operators to become very healthy, financially, over the last few years. Because of the hunger for timber and because of the dollar difference — and now it's going to be greater because of the change in the GATT agreement where tariffs have been lifted — those exports are going to be flowing. Utilization by the large operators leaves a great deal to be desired.

I've heard horror stories, and I've seen some of the evidence. I've seen good sawlogs deliberately broken, pushed over banks and buried because it was just too much of a hassle to get that particular log out. They are not effecting close utilization; they are not getting the number of board feel that a small operator would get out of those logs. There's much too much waste. It's very difficult to

[ Page 751 ]

allow anyone to get in there to utilize that waste lumber after the major goes over it; they don't want anyone in there. It's very difficult to get in there and take it out. It's left in such a state that it's almost impossible to get it out. It's piled, covered with dirt, burned immediately or pushed over banks. There's a terrific waste going on. Lumber is a very valuable and rich part of our heritage. It's a shame to see it destroyed as it is in many instances by these major corporations — much more so than by the small operator who has to scratch for every stick in order to make it pay. He's much more efficient in using that forest resource. Yet this minister is following a policy that is going to put those independents out of business. He's following a policy that is going to completely give our resource to the large majors; that's the direction we are going. This minister is taking no steps to prevent that from happening.

It started with the introduction of this forest bill. He tried to tell us it was going to do the opposite. I think we have been proven right in what's happening. The forest bill is simply adding to the number of acres and units which the large corporations are getting control over. The independent operator is in a tougher position than he's ever been in the last year or two since this bill was introduced, and since that minister has been in charge of forestry.

I can see a rather bleak future for us as British Columbians with closed-door deals made with the majors, with nobody knowing what they are paying or what they are doing, and that minister in charge of our major resource. It's a bit of a shocker, and it leaves me very discouraged about the economic future of this province. I don't want to see any greater control than we already have by the major corporations over our industry; that's happening every day that minister remains in office.

MR. KING: A bit earlier I was talking about the problems experienced by the small independent mills in the East Kootenay. To outline the problem more precisely than I have been able to do in my presentation thus far, I would like to read into the record of this particular debate a communication directed to the minister's office, dated April 2, 1979, under the letterhead of Sultana Corporation, a cedar products mill at Yahk, B.C. I wish the member for Kootenay (Mr. Segarty) were here, because the principal of this corporation is in the gallery this morning. I think the member for Kootenay should be talking to his constituent to try to understand the problems more effectively and, hopefully, to lend his support because of the problems this firm and many others are experiencing.

To get back to the communication, I'm going to read it:

Ministry of Forests
Mr. T.M. Waterland
Victoria, B.C.

RE: Small-business program available timber.

Reference herein is made to various letters, recommendations and the Forest Act with regard to Crown timber as it applies to small business enterprises.

Review of the above clearly shows that the policy set forth by the minister's office is not the same as the regional and local offices advised our association.

Available timber from the Creston PYSU annual allowable cut is the major area of disagreement. Note that the small-business program states on page 3, paragraph 1: "The minister may specify a portion of the annual allowable cut for small business." Further, on page 3, paragraph 1: "Not less than 15 percent of annual allowable cut will be available for small business enterprises." Please note that this does not provide the regional office with the discretionary power to reduce any portion thereof from the small-business program.

On February 7, 1979, Mr. T.M. Apsey advised our association delegates that the small-business program will be implemented. On February 17, 1979, Mr. Tom Waterland, Minister of Forests, advised our delegates that:

a) there is a small-business program;

b) that no less than 15 percent from the annual allowable cut will be provided:

c) that, if needed, timber will be taken away from big-business mills and given to the small-business program; and

d) that small-business program legislation can be passed within one week.

On approximately March 19, 1979, the deputy minister advised that instructions were given to the Nelson regional office to initiate timber sales from the AAC as related to the small-business program. On March 27, 1979, the regional office advised us that timber sales were being started and that forest sales of approximately 100 trees each for house logs and one salvage sale, previously logged off by Crestbrook, for ten small mill processors.

On March 28, 1979, the deputy minister advised that the salvage sale was not his instruction from the regional office. The TSLs were to be as defined within the parameters of the small-business program from the annual allowable cut.

On March 30, 1979, in another phone call, the deputy minister again cut. advised us that his instructions to the regional office were to initiate TSL under the proposed small-business program and not salvage sales.

On March 30, 1979, in a phonecall to the regional office, again we were advised that there were no changes in regional posture. The area is fully committed to the licensees and only salvage is available.

On April 6, 1979. a meeting with the regional zone manager, local ranger, deputy ranger and the association produced no timber within the small-business program. All was totally committed to big business.

For the records we ask: Why is the regional office not following the deputy minister's instructions? Why does the regional office continually state that the area is totally committed to major mills? What is the meaning of total commitment when the major mills' quota is only 49,000 cunits out of approximately 103,000 cunits? Why is there such a regional-office manager indifference to instructions provided by the deputy minister's office? Why has the regional manager informed area offices that there will probably be much less than 5 percent of annual allowable cut for the small-business program, when the program and the minister make statements that not less than 15 percent will be available? Why has the regional manager refused to recognize small-business enterprise as defined on page 7 of the program, which states: "The regional manager will take into consideration size, term and quality, so as to satisfy the needs of small-business operators."? Why has the minister's office refused to produce one shred of evidence in the form of positive legislation or contracts as defined within the parameters of the program, after indicating that legislation would take only one week — reference Mr. Tom Waterland's statement of February 17, 1979?

In review of all of this, in chronological order, it is becoming increasingly clear that no action or legislation by the minister's office is forthcoming, but rather has become a matter of political expedience. The minister is saying one thing to the small-business operators, while all along is doing something else for big business. Why have small-business operators not seen one concrete piece of evidence to support the 15 percent of the annual allowable cut for the small-business program? Why has the minister allowed big business to continue operation small businessmen have been provided with nothing and are being starved to death while waiting for action by the ministry

The minister's office has placed the small operators in a position where the taking of Crown timber under the Forest Act. Part X111, trespass and recovery will be the only way the small enterprisers will be able to operate, What kind of ministers and laws do we have that force the small-business operator to break the law to physically survive?

Yours sincerely
Eugene Schmidt.
Vice-president.
Kootenay Secondary
Mills Association

Mr. Chairman, that letter has never been answered. I am advised by the minister he has not deigned to answer that letter which was directed to him on April 2. It is a letter

[ Page 752 ]

which contains evidence of the frustrating experiences and the frustrating treatment that these mills have received at the hands of the Forests ministry. It is a letter which, in my view, clearly demonstrates the kind of discrimination that I've been talking about for the last few hours, and the minister doesn't even answer it.

Mr. Schmidt did receive an answer, not from the minister, but from the local regional manager, Mr. M.G. Eisner of Nelson. He received a reply on April 23 from Mr. Eisner, and it said:

"Dear Sir:

"We have received a copy of your letter of April 2, 1979, to the Hon. T.M. Waterland, concerning timber availability.

"You will no doubt be receiving a full reply from the minister's office in due course."

What a hope, Mr. Chairman.

"In the meantime, I must comment on the final paragraph of your letter wherein you imply that small business operators will be considering trespass in Crown timber. This is an extremely serious matter and I must make it absolutely clear that trespasses will not be condoned. The Forest Act contains provisions governing prohibited timber cutting and these provisions will be enforced in any case of trespass.

Yours truly,
M. G. Eisner,
Regional Manager.

There was total silence. They totally ignored the implications of what Mr. Schmidt and his conferees in the association had outlined in the letter which indicated discrimination in terms of any available timber supply for them. It indicated conflict between the minister's stated objectives and the position taken by the regional manager with whom they must deal for a timber supply. It indicated that rather than any sales being put up to sustain them, all that was offered to them were some salvage sales and some log sales for house logs. This is a sorry record. This is a discouraging record in terms of encouraging and developing small industry in the province of British Columbia.

[Mr. Strachan in the chair.]

I think my colleague from Nelson-Creston (Mr. Nicolson) outlined yesterday the circumstances surrounding the total annual allowable cut in the Creston forest district. I understand that the total annual allowable cut of 103,000 cunits was established based on inventories that were conducted in 1973, rather than any up-to-date appraisal or inventory. I understand that in 1977 the small business operators asked for third-band timber and the B.C. Forest Service rejected that request. But in 1977 the quota holders were issued a timber sale licence, and I think the number, if the minister would like to check this out, of that timber sale licence was A09060. It was third-band material, which was a substantial amount to the quota holders that was never put up for public bid. There's even been the suggestion by some of the small operators that the minister actually broke the law in so doing. He is so quick to have his staff threaten any of the small entrepreneurs who, out of desperation to keep in operation, may indulge in trespass. The full weight of the law will come down on them. There's the allegation that the minister may himself have violated the law in providing this timber sale licence to the existing licence holders without putting it up for public tender and thus excluding the small independents. Why was that timber sale issued in '77 not advertised? I understand it was issued direct without public competition, depriving the small operators of any opportunity to compete and bid for that timber.

These are the questions that the minister should answer. It's a pretty sorry record in terms of any commitment to or any hope for small businessmen in the forest sector that there is going to be some role for them. I don't know whether there is any point to continuing to belabour this thing or not. The minister and his staff should be highly concerned; unfortunately, I haven't really received that kind of response from the minister. Rather than coming to grips with the specifics of these very serious allegations, he simply gets up and generalizes and says: "Look, we're going to come down on them. We're going to provide timber for small enterprise. We're going to minimize the abuse and the waste by the major licence-holders." However, they're presumably going to be allowed to retain their monopoly. I think we deserve something better than that, Mr. Chairman.

As I indicated, Mr. Eugene Schmidt, who is the president, I believe, of the small businessmen's group in the Creston forest area, is in the gallery today. He is not politically motivated. He is motivated in terms of trying to produce something out of our forest resource, trying to create some jobs, trying to determine whether or not there's going to be a role for the small entrepreneur in the forest industry. He's received the classic double shuffle from the minister and his staff. The minister says: "Yes, we'll make timber available to you." The regional office says: "There's none available; it's all allocated." That makes the minister look good, because he says: "Look, I'm trying to do something for you. " He kept promising until the election was over. Now the minister doesn't even bother to answer letters, and now I suspect the truth is going to come out that the minister has, in fact, no commitment, and no real intent to make timber available to small enterprise in British Columbia.

It's not good enough to wait until next year. Many of these small firms are going to go down the tube unless they receive, not promises but some material commitment. As one operator in the north part of the province has said: "You simply can't go to the bank on promises and expressions of sympathy from the Minister of Forests." Surely it is apparent to everyone that if the large integrated firms need long-term tenure to insure their role in British Columbia, the small independents need some commitment and some tenure as well, rather than empty promises.

Mr. Chairman, I want to repeat for the benefit of the member for Kootenay (Mr. Segarty) that Mr. Schmidt, your constituent, who has provided this material and who has met with the minister on numerous occasions, is in the gallery today, and I hope the member for Kootenay will get in touch with him, and meet him and discuss these problems. And if he finds that I have in any way been misrepresenting the story that was presented by this group of eight sawmills, then he has an obligation to stand up in the House and say so. But if he finds that this is, indeed, valid material and that this is a true and accurate assessment of the frustration those small independent businessmen have experienced, then he has an equal obligation to get up in this Legislature, as I have done, and demand action and

[ Page 753 ]

accountability from the Minister of Forests, notwithstanding the fact that he may happen to be a member of the same party.

If there is to be any credibility whatsoever in that government's claim that they do represent true, competitive enterprise, then this kind of discriminatory conduct, this kind of double standard when it comes to the treatment of the large integrated monopolies as opposed to the small business people, must come to an end. I want to say, Mr. Chairman, that it's not going to come to an end until members on all sides of the House are prepared to speak out and demand a better calibre of performance from this minister. It's not going to happen until the public is made aware of the magnitude of the abuse that's taking place under the auspices of a minister who says he is dedicated to the very things that he has failed to produce.

Mr. Chairman, I strongly suggest to the member for Kootenay that he get in touch with the principals involved in this correspondence, meet with them, consult with them and at least represent them in this Legislature. That's what people are sent down here for — to discuss and to outline the problems that have developed in their own regions. Certainly the member for Kootenay has an obligation to do so. I am going to leave it at that again and hope the minister responds in some meaningful way. Later on I will be dealing with the inadequate commitment of funds through the minister's department for intensive forest management, for adequate silviculture, for adequate programs of reforestation.

I will be dealing with a variety of other matters and calling the minister to account for his administration. But, in my view, the emergent problem — the one that transcends all considerations because we're being deprived of jobs in revenue — is the increasing entrenchment of the monopoly that this minister is presiding over. I think he has an obligation to give some commitment to the House today that he is going to deal with that matter in an effective way, at the earliest opportunity.

HON. MR. WATERLAND: Mr. Chairman, the member for Shuswap-Revelstoke has once again repeated many of the things he said in his last two speeches on my estimates. He brought up, however, a letter from Eugene Schmidt. No, I didn't write an answer to Mr. Schmidt's letter — I forget the date of it. However, Mr. Schmidt and I and others of my staff met for about an hour in my office to discuss in detail the many points he raised. Mr. Schmidt has a habit of either taking things which I say out of context, or else misinterpreting.

I never did tell Mr. Schmidt, when we met him in the Kootenays in February, that we would immediately put up sales in the small-business program. At that time, if I had, Mr. Schmidt probably would have not have been able to compete for them, because we didn't have the distinction between the class of small business he is and others.

We did try to put up salvage sales to tide him over. At no time did I say we were immediately going to put up sales under the small-business program; that was not possible at the time. I believe that I personally, my Deputy Minister, Mr. Apsey, and others of the staff have spent a great deal of time with Mr. Schmidt trying to explain to him what our small-business program is, when it will be in place and what it will mean to them. He understands, I hope, what we're doing, what we're trying to do; and I will just say again to that member that we will have a substantial small-business program. He's asked for a commitment; I've given him that commitment no less than six times since my estimates began, so I will say it again: we will have a small business program and it will be underway just as soon as we pass amendments to the Forest Act.

MR. NICOLSON: Mr. Chairman, last night when I spoke was.... I guess one couldn't say one was happy to have information confirmed about serious mismanagement along a right-of-way, but I was glad the minister and I were on the same track in terms of information.

The minister said just now, in responding to the member for Shuswap-Revelstoke — and I suppose it's quite accurate that six times he has given the commitment that there will be a small-business program in effect.... What we're talking about is the fact that, as I outlined last night, there are existing small-business enterprises, and they are, some of them — I know one in particular where the person is still working — right on the verge of bankruptcy. He needs timber today. He really needed it about six months ago.

I understand there are about seven sales proposed for that area in the Kootenays, but by the time the silvicultural assessment is done, and the cruising of the timber is done, and the advertising of the sale takes place, some of these people will be so completely under — and their bank credit so overextended — they will be going through foreclosure proceedings. Because of the nature of the specific sites, only two of them could probably be logged next winter, and the other seven will not be available until next summer. That is just too far away.

What the member for Shuswap-Revelstoke (Mr. King) is suggesting is that some extraordinary measures have to be taken, and some blame has to be given to the Forest Service, who have known about this for quite some time. It is true that under the old legislation that quota was increased for Jack Wiggins, who is not a big operator by any means, but certainly bigger than the scale we are talking about here.

[Interruption.]

HON. MR. CHABOT: You're making the baby cry.

MR. NICOLSON: The child can't see me from up there, but it can see down in those benches, Mr. Member.

HON. MR. CHABOT: He or she can hear you, though.

MR. NICOLSON: Mr. Chairman, what we are talking about are small-business people who are more suited to being self-employed than they are to going to work for some other person. They are people whose greatest asset is perhaps also a liability in life. If these people are to make a contribution to society, they can make it as persons who are self-employed.

I know the personal background of some of these people, and I must say that one could probably write a few novels about some of them. They're very interesting people with fierce intensity and drive, people who would keep on going when many others would long since have quit, and who I fear are, quite frankly, not suited to working for wages, but are suited to working, for Lord knows what reason, in that much more trying form of employment — being self-employed and running a small business; taking

[ Page 754 ]

risks and working long and sometimes unrewarding hours; fighting for that kind of an ideal which has characterized the drive and the backbone which has been part of the building of British Columbia. These people are like the old Gordon Gibson Sr., people who make a living in the bush and don't just look for all of the security and tenure that others of us, such as myself.... I've worked in a factory, I've sought the security of a union, and then as a teacher.... I spent about as much time in one area as in the other.

HON. MR. PHILLIPS: What else is he going to do'?

MR. NICOLSON: Oh, I've been fairly successful in getting myself re-elected, Mr. Member. The Minister of Economic Development, who interrupts, is the member who didn't even want to come down to this House in 1972, when he was elected, but he only ended up in a paltry little opposition of ten members. He was so discouraged. He didn't want to represent the people of Peace River. He wanted a big fancy cabinet job. That's all he wanted and that was his only motivation. So he likes to interrupt, Mr. Chairman....

AN HON. MEMBER: He helped turf you out, though.

MR. NICOLSON: Oh, he's helped me out on many occasions — helped me get re-elected, Mr. Member, by some of his actions.

HON. MR. CHABOT: Casa Loma!

MR. CHAIRMAN: Order, please. All members should be advised that we are debating vote 117; that message is to all members. Please carry on, Mr. Member.

MR. NICOLSON: Thank you, Mr. Chairman. It does make members of the government a little bit twitchy when somebody from this side articulates the philosophy of small independent business and free enterprise better than any of those people are prepared to do. I have never seen such a bunch of cowards in that back bench that won't get up and speak for free enterprise in this House.

SOME HON. MEMBERS: Oh, oh!

MR. CHAIRMAN: Order, please.

MR. NICOLSON: What are they trying to cover up, Mr. Chairman?

MR. CHAIRMAN: Order, please. The Chair will ask you to withdraw the word "coward," please. It is unparliamentary.

MR. NICOLSON: Just a minute please, Mr. Chairman, I want to check with Beauchesne.

MR. CHAIRMAN: Withdraw.

MR. NICOLSON: No one has taken objection. No one has asked for a withdrawal, Mr. Chairman.

MR. CHAIRMAN: The Chair did.

MR. NICOLSON: Mr. Chairman, under standing orders, when the Chair makes a ruling, it is to cite standing orders or parliamentary authorities. "The interpretation of both the written rules and tradition in the hands of the Speaker and his deputies with their rulings forming a fundamental part of procedure...."

MR. CHAIRMAN: It's not up to the member to lecture the Chair. I have asked you simply to withdraw the word "coward," which, in the Chair's estimation, is unparliamentary. Would you please withdraw?

MR. NICOLSON: On a point of order, Mr. Chairman, I will draw to your attention the duties of the Chair. I'll withdraw the word "coward," but on a point of order, I'm hoping to continue. I draw your attention to the standing order 9. "Mr. Speaker shall preserve order and decorum and shall decide questions of order, subject to an appeal to the House without debate. In explaining a point of order or practice, he shall state the standing order or authority applicable to the case."

I would like Mr. Chairman, since he has taken it upon himself to rule against the term "coward," to cite the authority which designates the word "coward" unparliamentary when I did not attribute it to any single member.

MRS. JORDAN: A point of order, Mr. Chairman.

MR. CHAIRMAN: The member for North Okanagan on a point of order.

MR. NICOLSON: There is a point of order on the floor, Mr. Chairman, on which I have asked you to rule. Many times it is stated by the Chair that you cannot have two points of order being under consideration at the same time. Are you going to deal with that member?

MR. CHAIRMAN: Order, please. We will deal with the first point of order. The member has withdrawn the remark, which is acceptable to the Chair. It is not up to the Chair to cite standing orders for unparliamentary words. The member has withdrawn, and that is the end of it.

MRS. JORDAN: Mr. Chairman, if the member has withdrawn, my point of order has been made.

MR. NICOLSON: Mr. Chairman, the people that we're talking about in this specific case — and I know I've also met similar people in areas such as Vernon and Kelowna — are self-starters. As has been said, they have a capital investment. I know that one of them, through frustration or whatever, embarked upon a trespass of some magnitude. It doesn't justify their action but it isn't fair that people are being put so much to the wall that they have been driven into doing this type of thing out of frustration.

I would just hope that the minister would give an undertaking to put on a special crafts program to get the silvicultural work done that might have to be done before the assessment of soils or whatever. Oh, the minister looks and frowns. I don't pretend to be a graduate in forestry, but I understand that certain work has to be done before these seven sales can be made. I want to know when they can be advertised and when they will be announced.

[ Page 755 ]

If the minister frowns and if such work doesn't have to be done, has the cruising been done? Why could that not have been going on in the last two, three or four months, or the last year, when the minister was planning to create some kind of a special small-business program? He knew full well that if he was going to deliver something under this program at the earliest possible date, certain kinds of preparatory field work would have to be done. You have to survey the area, you have to flag the area, you have to timber-cruise the area. What is the minister prepared to do in terms of bringing that on as immediately as possible, and what is the earliest possible date by which those sales could be advertised and the tenders, the sealed bids or whatever, received and announced?

HON. MR. WATERLAND: In reply to the member's question, Mr. Chairman, the work has been done. The sales are ready to go, and I believe I mentioned this when the member was out of the chambers. It requires 30 days' advertising for the sales. Registration of small businessmen under the program is required in order to determine who are small businessmen, and that is underway now.

The forms are out in the hands of the regional officers and registration is underway. The sales are ready to go, and the law requires 30 days' advertising before the actual sale can take place. But we have been doing the homework, the preparatory work, and we're ready to run with them right now — as soon as our amendment to the bill is passed, whereby we can have the different classes of businesses.

[Mr. Rogers in the chair.]

MR. NICOLSON: Another thing that I would hope could be said here is that no one in politics has a thin skin. I hope the minister doesn't have one. I don't think that he has one.

Mr. Eugene Schmidt and many other people in the area have, I think, been doing a service for the people of British Columbia. If they're critical of the minister out of some frustration, I'd like the minister to know that they're critical of me too. I hope there are no hard feelings. I'm afraid there are some in the bureaucracy, but I hope that at the top, at least, there are no hard feelings about these things, because, in speaking out on these matters very strongly, these people are doing the people of British Columbia a great deal of good. Not only that, they always have done so, in terms of being the kind of people who provide employment.

I am still concerned about what date, within a week or two, the minister expects that the people who are successful bidders — assuming that this legislation goes through, and the House leaders are in control of the calling of legislation — could be into the bush and actually starting to harvest such material.

HON. MR. WATERLAND: Mr. Chairman, I, of course, don't have detailed familiarity with all the sales we are planning; but the sales and the small-business program which will be getting underway immediately are in already developed areas. They require no road development or that type of thing. They will be adjacent to existing access roads. So as soon as the sales are awarded, loggers should be able to go to work immediately.

MR. KING: I want to, at some point during the minister's estimates, go through the new draft licence forms that the ministry has prepared for the various licence holders in the province. I have a great number of questions regarding the particular form, and the particular language used.

I want to refer back to the general criticism that I've put forward of the ministry in terms of their stewardship of the forest resource. I've tried to outline as effectively as I know how the plight of small business in the coastal area and in some parts of the Interior. I've outlined the attitude of the small business people in their dealings with the ministry, and I find that the same complaints are being made from many parts of the province. I could enumerate similar problems that have been drawn to the minister's attention by Jackson Bros. Logging up in the Sechelt area, and I know the minister has had correspondence there too. I don't know how many cases of control, how many cases of demonstrable discrimination, how many cases of demonstrable neglect one has to present to this House in order to convince the minister that there is something wrong in terms of the independents' access to timber resources in British Columbia. It's significant, Mr. Chairman, that I've received not one complaint from any of the large licence-holders. They seem more than content in terms of their access to an adequate timber supply. In every case the files that have come to my possession relate to the frustration experienced by small independents in all parts of the province in terms of trying to maintain their operation, in terms of finding an adequate timber supply, and by the minister and his ministry's apparent indifference to the plight of these people who are fighting for survival: vague promises for the future; something is going to happen: something is going to change. That's pretty weak stuff on which to set your business operation.

The other significant factor about it that should convince the minister that we are dealing with an emergency here is the fact that while the big integrated forest companies of the province are important to our economy, they are generally centralized in the lower mainland area. There are some large ones up in the Interior too. But a lot of these small independent mills are in areas and in communities where there is virtually no other industrial base. Therefore their importance to the community, to the lifestyle and to the local regions is of tremendous importance. If they cut back in terms of their production and their employment, it's a major blow to local payrolls. It has a ripple effect throughout the whole economy of the local area. It means that, with a reduced payroll, less is purchased from the other business enterprises of the community. Local restaurants suffer; the local service industry suffers; there's a complete ripple effect throughout the economy generated from cutbacks in the small-business sector.

It's not on the scale of the MacMillan Bloedels and the Weyerhaeusers and the Crown Zellerbachs. But in relationship it is just as important and just as profound to the regional economy of British Columbia. It's of little use for the minister to give rather pathetic assurances that he intends to deal with these problems at some future date down the road when, in fact, they are dealing with today. They must have an assured supply in order to know that they're going to have a role in the industry tomorrow. These are the things the minister has failed to address himself to.

[ Page 756 ]

Mr. Chairman, I don't know what more I can say about the neglect of the small-business sector of the forest industry. I don't know what more I can say, except to try to direct public attention to the problems on every occasion that I have to try to make the media aware so that they will be a bit more critical in their scrutiny of the Forest Service administration.

I think one of the reasons the minister is able to get away with this kind of negligent administration is simply because it is a specialized area and the public is not, generally, highly aware of what is required for good, sound forest management policies in the province. The public views the forest industry as something that takes place out there in a highly specialized way, with jargon and slogans and professionals that defy the understanding of lay people. They therefore hesitate to venture into any discussion or debate of the proper husbandry of our forest resource. That has allowed the minister to sit back, in a rather insulated way — free from a great deal of public scrutiny — and allow the status quo to prevail without any imperative pressure to bring about fundamental changes in the very sorry state of the industry in British Columbia in terms of a fair allocation of the resource.

Be that as it may, I can't force the minister to change. I can only appeal to all members of the House. I can only appeal to the public and to the media to test the validity of the allegations that have been put forward in this debate and on other occasions. Certainly the Truck Loggers Association at their last convention expressed much of the same concern and many of the fears that we in the opposition expressed when the Forest Act was introduced. In light of subsequent experience, many of our concerns and many of their concerns have come to fruition.

They've happened, and I sincerely hope that people in the industry such as the truck loggers, such as small associations similar to the ones up in the East Kootenays, are going to have the courage to speak out publicly, because there always has been a bit of fear which has pervaded the forest industry. Because of the monopoly, because of the control of markets, because of the reliance of the small operators upon the major ones, there has been an ability to intimidate, an ability to exert pressure and control. That's another side effect and a very serious implication of the monopoly circumstances which the minister is presiding over. That completely flies in the face of any competition in the industry. It completely flies in the face of open public dealing in the forest industry, and it's a very, very dangerous kind of structure which is allowed to exist.

Mr. Chairman, I want to move away from this general thing. The last hope that I wish to express is that the minister and the government will consider very carefully the concerns that have been raised in this debate and reassess their position with a view to doing something in a very demonstrable way to assist and to ensure the survival of small business enterprise in the forest sector of our economy.

Let's move to the forms which the ministry has put out for the renewal of tree-farm licences and cutting permits. I want to pose a number of questions to the minister regarding the form and the language involved in these draft revisions which I have in my hand. I want to extend my appreciation to the ministry for its courtesy in providing me with these renewal forms and the data that I requested from them at the earliest opportunity. I don't know whether the minister has this material at hand, but I would draw to his attention that on page 2 of the.... What I have are only draft forms for tree-farm renewals.

HON. MR. WATERLAND: This is for tree-farm licences?

MR. KING: Yes, the renewals of tree-farm licences. Section 104 says: "The term of this licence is for 25 years beginning..." and the space is left blank. I want to ask the minister if, in that renewal form, that date is negotiable, or if it is an automatic provision that the date of the renewal will be the date of the passage of the new Forest Act. Or is it the date on which the current licence expires? I wonder why in extending a licence renewal for 25 years the beginning of the licence renewal is left open. I wonder if the minister could comment on what the reason is for that. Is it a negotiable factor or not? If it is negotiable, what are the factors that the minister will be considering in terms of renewing that licence?

Section 200 governs the management of working plans, and section 201 provides that "within months after this licence is entered into the licensee will submit for the chief forester's approval a proposed management and working plan for the year period beginning January 1," — whatever year it is effective in. I want to ask the minister what is meant by "within months after." That is the most general wording I have ever heard in any provision of this kind. It is in the forms for the management and working plans of the applicant; it says "within months." Is that time a negotiable factor dependent on the licence renewal? Or is it intended to mean precisely what it says — "within months" — just as a general provision? Or is it intended that blank space is to be filled in with a specific number of months? It goes on:

"The chief forester, in a notice to the licensee, may require that a management and working plan be amended or replaced where (a) timber in the licence area is damaged by fire, wind, insects, disease, or other natural forces, or (b) serious damage is caused to a timber processing plant of the licensee or there is a labour conflict, war, civil insurrection, adverse weather conditions, depressed markets, or other circumstances beyond the licensee's control where the chief forester considers that the occurrence has rendered the management and working plan inadequate. "

Some of the considerations there and some of the language are unusual. I would like the minister to comment in terms of what the philosophy is behind reference to labour conflicts. Is it intended that if there is a labour dispute, and perhaps a work stoppage flows from that dispute, the licence may be altered? If that's the consideration, I find it an unusual intrusion into the domain of industrial relations. If it simply relates to the licensee's ability to harvest the resource, perhaps that is understandable. I find it a bit remarkable also that a labour conflict is put into the same context as a war or a civil insurrection. Quite frankly, I have to question the minister regarding the philosophy behind all of those provisions.

I have a great many other questions, but rather than proceeding too far I'll give the minister an opportunity to answer those particular queries.

[ Page 757 ]

HON. MR. WATERLAND: I don't have with me the specific document referred to by the member, but I think I can answer in a general way.

He referred to a blank in the renewal date. The legislation provides for a renewal date, which is based partially on the length of time the current working plan is good for. We've tried to spread the renewals over a period of time so we can handle them administratively and recognize the current working plan. If the current working plan is in effect now and there's a short period before its expiry date, that date will be filled in. But there will be a specific date filled in, as is the case under section 20, where a specific date is provided. That is intended to be a blank and each licence will have a specific number of months filled in.

Section 204 is sort of a force majeure thing; it refers to the working plan. If it is impossible to comply with the approved working plan — through any of the matters mentioned by the member, including a prolonged work stoppage — it may be impossible during a particular year to carry out the part of the plan that was supposed to be carried out that year, in which case it may be necessary to modify the five-year working plan to accommodate that. Of course a major fire, insect infestation or war, I guess, could all make it impossible to comply strictly with an approved working plan, so we must have enough flexibility to modify it if such circumstances do develop.

MR. KING: I appreciate the minister's advice. I did feel that the context of all those provisions was a little bit unusual.

In section 206, paragraph (a), there's another provision. Perhaps I should read the whole section:

"The proposed management and working plan shall be prepared, signed and sealed by a registered professional forester and shall contain (a) information respecting the inventory of the forest resources and, where available to the licensee, respecting the soils, fisheries and wildlife resources and recreational capability of the licensed area...."

In light of the tremendous conflict that was generated from a logging proposal in the Queen Charlottes last year, a conflict between the federal Fisheries department and the provincial Forest Service, which culminated in people actually going to jail for violating a federal Fisheries order.... I am not getting into whose fault it was at this point, but just illustrating the kind of conflict that can develop over the proper use of land and respect for the competing values of land use.

I find this provision in section 206(a) pretty weak in terms of giving any consideration to those other uses of land. The suggestion that where information is available to the licensee.... Well, that's not a very specific admonition. What happens if it's not available? Is the licence processed only on the basis of consideration of the forest use? In those circumstances is there no reference at all to the provincial fish and wildlife branch, to the provincial water rights branch or, indeed, to the federal Fisheries department? This is a wide-open kind of mandate, it seems to me, and I wonder what the minister has in mind in saying it shall contain "information respecting the inventory of the forest resources and, where available to the licensee, respecting the soils, fisheries and wildlife resources...."

I think anyone who is applying for 25-year tenure on a major portion of Crown resource should have a very specific obligation imposed upon him to deliberately canvass those other areas. It should be part of the requirement that he either employ a biologist or refer his application to the biologists in the provincial fish and wildlife branch in the Environment ministry, to determine whether or not there is any conflict, and, if there is conflict, whether or not it can be accommodated through amendment to the working plan. That is the only way, Mr. Chairman, to avoid the kind of conflict which the minister found himself in last year when there was competition between the Forest Service and the federal Fisheries department on the Queen Charlotte Islands. As I say, people went to jail. So this particular section is extremely weak. Where available, the licensee will provide it. Well, that should be required of every application for licence renewal, and I want to ask the minister whether or not there is some other provision that I am not aware of, or whether this is the single requirement for those firms seeking a renewal of their tree-farm licences.

Would the minister care to respond?

HON. MR. WATERLAND: Mr. Chairman, a good point is raised by the member. Once you have determined what you want, what you actually get when it comes back in legal terms is sometimes confusing to we legal lay people. But what we're saying there is that in the development of the working plan itself, as the plan is developed, whatever information is available at that time will be used in the development of the working plan.

Following development of the working plan is the approval of individual cutting permits within that plan. What the working plan will then do is identify those areas in which information is lacking: that must be provided before the cutting plan itself will be issued.

This is very specifically referred to in the Ministry of Forests Act. It identifies the fact that we must have consultation, cooperation with these other resource managers. But the working plan itself identifies areas where there is a lack of information which will be provided before individual cutting permits are issued.

MR. KING: Mr. Chairman, I appreciate the minister's response, but I point out to him that the Forest Act is one thing in terms of its general direction, but the real legal authority for the actual harvesting, as I understand it, flows from the management working plan, and its endorsation. That's the real legal right to enter, log and cut the resource. So unless there's a specific provision contained in here, it seems to me, to actually provide the data relating to other competing uses, then it's going by the board.

The fact that the Forest Act says this will be done is not illegal — it does not impose a legal requirement, it seems to me, on the licensee to do it. This is the legal authority: the management working plan. Mr. Minister, I would suggest that by simply obtaining a forest licence you are not authorized to go out and start logging it. You have to come before the ministry with a management working plan, indicating how you propose to do it, which area you intend to harvest first, and so on. Once that plan is approved, then you actually have the legal right to start harvesting. Well, the conditions of your management plan are the ones that impose any legal obligations upon you in terms of how you log and where you log. If they're in conflict with the Act in

[ Page 758 ]

terms of determining the legality of it, it seems to me it would be the management plan which would be the guiding factor. So I would certainly like to see those forms strengthened a great deal in terms of making it incumbent upon licensees to make sure they consult with the Ministry of Environment and their staff, the water rights branch and the fish and wildlife branch to ensure that before they have the licence to start harvesting, any potential conflicts are identified and accommodations made. Otherwise we're going to be back in the bag again where a conflict breaks out. There are going to be competing orders issued by federal fisheries representatives in conflict with the cutting permit by the ministry's staff. And of course the last thing in the world we need is that kind of foolish conflict over what we all have a genuine interest in achieving, and that is the proper use — in harmony with all interests — of the resources of the province. So I wish the minister would have a very close look at that particular provision and strengthen the language in the requirements in it.

The other thing is, Mr. Chairman, that what I have here is marked "draft." It's a draft copy I received from the ministry, and it may be that there have been some amendments to this particular draft that was mailed to me, I think, on April 18. If that is the case, perhaps the minister would let me know. But in the meantime I'd like the minister's response to my understanding of the sequence of events in this matter.

HON. MR. WATERLAND: Mr. Chairman, I would be very happy to provide the member with the final document which is in place now; but the specific authority to cut wood is the licence to cut wood — the cutting permit — and a cutting permit will be very specific as to what considerations have to be given on that cutting area. That's where all the detailed information on soil types, effect on stream banks and so on takes place. The ultimate authority, of course, where there are requirements of what has to be done, is within the Forest Act and the Ministry of Forests Act. These other documents, the working plans, the tree-farm licence document and the licence to cut must reflect the requirements of the legislation. But the final specific authority to go in and begin to cut down trees is itself within the licence to cut, the cutting permit.

MR. KING: I can appreciate that the cutting permit is the final document, but the cutting permit is hardly as broad and as exhaustive as the cutting plan or the management plan. And it seems to me that's where the information has to come from, which would adequately recognize these other concerns. Once these have been met, then I can see the cutting permit being issued.

This is the draft copy of the provisions that the licensee must meet before he receives his cutting permit, and it seems to me they are deficient in terms of the scope of the protection that the licensee should be required to obtain. Following on, I wanted to ask the minister a question with regard to section 207(a) on page 4. It says: "An allowable cut...."

Did you want to move on to something else, Mr. Chairman?

I move that the committee rise, report progress and ask leave to sit again.

Motion approved.

The House resumed; Mr. Speaker in the chair.

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

HON. MR. GARDOM: Mr. Speaker, I ask leave to proceed to public bills and orders.

Leave granted.

HON. MR. GARDOM: Second reading of Bill 22, Mr. Speaker.

FOREST AMENDMENT ACT, 1979

HON. MR. WATERLAND: Mr. Speaker, Bill 22 is a series of rather unrelated amendments to the Forest Act, which we found necessary as we drafted regulations to put the Act into force. I think it's very difficult to determine a general principle of the bill, which is what should be debated in second reading. So may I suggest that we examine each section in detail in committee and we can probably have better debate on the bill in that way.

So, Mr. Speaker, I move that the bill now be read a second time.

MR. SPEAKER: The member for Revelstoke-Shuswap.

MR. KING: Actually, Mr. Speaker, it's Shuswap-Revelstoke.

MRS. JORDAN: But not for long!

MR. KING: I wouldn't hold my breath, my friend.

Mr. Speaker, I do not intend to debate the bill, but I would like to serve notice on the minister that there are a number of concerns that I have regarding this bill, and just in a general way ask him to be prepared to deal with these matters, probably in committee.

The first is the real effect of the small business set-aside provisions. The former statements by the minister that the only delay in giving effect to and initiating the small-business program was the lack of regulations, and that once the regulations were in order, he would be prepared to go ahead with the small-business program.... He later changed his tune a little bit and indicated that amendment to the Forest Act was required before the small-business program could be initiated. Quite frankly, Mr. Speaker, I fail to see where there's anything introduced in the amendments that could be of major significance or could adversely affect the minister's ability to establish the small-business program, to assign inventory to that small-business program above all other things, or prepare him to go in the same hasty fashion in which he was able to find and allocate timber to the major licence holders in the province of British Columbia — expeditiously, without delay.

The other concern I would ask the minister to direct his attention to and to be prepared to deal with in committee is the reference to the change in the status of the scalers.

My interest here is whether this has some industrial relations implications, whether this in any way affects the jurisdiction of scalers who are members of the IWA by making it mandatory that they now become government employees and hence reside under another union jurisdic-

[ Page 759 ]

tion. It's just a thought and a curiosity I have, and I would like the minister's explanation in that regard, certainly when we get to committee stage in the bill. I just wanted to serve notice what my main areas of interest are.

MR. BARRETT: Upon returning to the province, I turned on the radio broadcast this morning to hear the minister's tones on CBC speaking about this bill.

HON. MR. VANDER ZALM: You wouldn't recognize him; you've been away too long.

MR. BARRETT: I recognized him; he's the only one that's different than you. He doesn't pop up all the time. He just does it once in a while.

Mr. Speaker, I'm being interrupted. I heard the minister say that these regulations, these amendments in the bill were necessary to provide access to forest resources for the small loggers. You promised that when you brought in the first bill saying it would come through regulation. I was shocked, Mr. Speaker, to discover the minister trying to explain away his complete failure in providing competition in the forest industry for a year by saying now he's going to do it by legislation. Mr. Speaker, that is known as a definition of incompetence. A year and a half has gone by and small operators have made major capital investments and have tried to get access to forest resources. I even have gone to the Deputy Minister of Forests' office with a group of Interior operators who were looking for timber, and we were assured at that time that the minister's word about regulations would be kept, and now we have this legislation.

Who is kidding who? As far as I'm concerned, I heard the minister this morning give another stall to the small operators. I would like the minister to stand up in this House at the close of second reading, when he thinks it's a nice soft ride and a gentle interruption, and say: "We just got a few amendments here. They're unrelated."

I want a promise, a commitment and a date when the small operators in this province are going to have a chance against the giant monopolies that control the forests.

You claim to be free enterprisers. There has been an increasing stranglehold on the forest resources of this province by large international companies. The one chance we had for maintaining some semblance of public control and public access was through Can-Cel, the purchase made by the previous administration.

Mr. Minister, I don't think you give a tinker's darn about the small operator. I don't think your ministry has lifted one finger. I don't think you have the clout in cabinet. I don't think you have the philosophical commitment other than to toady to the big corporations who have had everything their own way since Social Credit got elected.

When this outfit was in opposition, Mr. Speaker. they complained bitterly about small operators. the opportunity for initiative and the opportunity for investment. We had the Pearse royal commission report offer a series of recommendations that would have guaranteed the small operator a break at a forest resource. This government has deliberately avoided dealing with the Pearse recommendation. It wrote a bill that had absolutely no relationship with the Pearse recommendation, and it is handing over the forests of British Columbia holus-bolus to the large corporations while playing a little bit of a game of jiggery-pokery on the side, saying: "We are looking after the small operators." By the time you get around to it they'll all be on welfare.

There is an incredible catalogue of history of the concentration of power in this province on access to forest industry. My friend down the way reminded me of the whole tour we had originally made in the early seventies on the Houston route, and the small operators who were burnt out because they'd sold out. Yes, my friend remembers those speeches of those days. But the fact is, Mr. Speaker, there's been a catalogue of concentration of power as a deliberate policy by Social Credit. They have no philosophy of commitment to the small logging operator, not even to what he would consider to be exotic experiments of returning to hand-logging. They have no commitment to competitive bidding for forest resources, nor to the competition of letting the small entrepreneur prove he can do a better job.

I remember the speeches the minister has made over the last year and a half, saying: "If you don't use it, you lose it.'' No one has lost a darned thing when it comes to the big companies, Mr. Speaker. The only people who have lost in British Columbia are those remnants of the pioneering families, that small operator who wants a chance at forest resources. That minister, Mr. Speaker, has sold out to the large forest corporations. has centralized their control in the resources, has stalled any approach for a small operator to get any timber. There isn't an MLA who represents a rural area that hasn't had the small operator come to him and say: "Look. we're in a terrible bind." In Columbia River I ran across it, and the member for Columbia River (Hon. Mr. Chabot) knows what the problem is in his riding. Certainly he does. The small operators have not had a chance at timber in that riding. Laugh as you may, Mr. Attorney General. You represent Vancouver–Point Grey, and that very dilettante area that benefits....

Interjections.

MR. BARRETT: You know, Mr. Speaker, I find it interesting that at a few minutes to one o'clock on Friday they would quietly bring in this amendment after that minister has gone on radio saying: "This is another clean-up attempt" — and a promise and a promise and a promise.

Interjections.

SOME HON MEMBERS: Oh, oh!

MR. BARRETT: What is he doing butting in on my speech? It is the right-wing Liberals who are dominating this group and now cramming down the throat of that minister orders that cut out the small operator. The right-wing Liberals who have always been toadying to those international corporations that dominate our forests....

HON. MR. GARDOM: Vintage Lewis!

MR. BARRETT: Vintage Lewis! Vintage jerk!

I find it really an interesting series of....

Interjections.

[ Page 760 ]

MR. BARRETT: Will you please shut up? Mr. Speaker, I would ask the member to please stop interfering. He's hurting my feelings.

MR. SPEAKER: Order, please, hon. members. Let's have one member speak at a time. Please proceed.

MR. BARRETT: Mr. Speaker, what prompted these remarks was the minister's bland statement of admission this morning that there still is a problem with the small operator, but now he's going to bring in legislation to clean it up. You promised that the regulations would clean it up. Your ministry has done absolutely nothing to protect the small operator in this province. I think it would be worthwhile if over the weekend the minister could come back to us with a statement and a commitment on the part of the government that the small operator in British Columbia is going to have some access to timber, and that against the big companies who are not performing, as outlined by my colleague from Shuswap-Revelstoke, some action will take place. I want the minister to think about it over the weekend. I want him to reread his old statements in Hansard, and I want some assurance for those small operators that some action is going to take place.

I was shocked this morning, Mr. Speaker, to hear the minister using that line again: "I'm going to do something. I'm going to do something." Mr. Speaker, as far as I'm concerned, that minister has done nothing for the small operators here in the province of British Columbia, and has no intention of doing anything for the small operators.

I find it most disappointing, Mr. Speaker, that on top of that, at the end of a week in this House, all we get from that minister is a statement that they are little unconnected, unrelated things. I draw your attention to the clock.

Hon. Mr. Chabot filed the annual report for 1978, for the British Columbia Housing Management Commission.

MR. BARNES: I'd like to introduce a couple of friends in the gallery.

MR. SPEAKER: Hon. member, my attention has been drawn to the clock.

MR. BARNES: Well, with leave, perhaps it would be okay.

Leave granted.

MR. BARNES: In the gallery with us this afternoon are three brothers: Paul, Art and Arnold Wynne. Paul Wynne works with the Secretary of State Department. I would like to have the House welcome them this afternoon.

MR. SKELLY: On a point of order, earlier in this sitting I referred to you a matter which I addressed to the House as being a matter of urgent public concern, and I wish to have your decision on that matter.

MR. SPEAKER: Hon. member, unfortunately my attention has been drawn to the clock, and it would be inappropriate at this time.

MR. BARRETT: On a point of order, as the appropriate action on attention being drawn to the clock is the immediate removal of the Speaker from the Chair, you broke that precedent by calling for the normal motions. As a consequence we're in the normal motions — drawing attention to the clock was not followed correctly.

MR. SPEAKER: Order, please, hon. member. On the point of order raised by the Leader of the Opposition, the procedure, on the Speaker's attention being drawn to the clock in this House, provides opportunity for the normal motions of adjournment, because without those motions of adjournment the debate on whatever happens to be before the House collapses. I would remind the hon. Leader of the Opposition of that, which is traditional in this House.

MR. BARRETT: Yes, Mr. Speaker, and once we move into that traditional practice, then the member's point of order is in order, in my opinion. There was a delay on an emergency motion; we went into normal practice without leave of the House; and we're now expecting to have an answer to the member's question — and that's normal practice in the House, Mr. Speaker.

MR. SPEAKER: I appreciate the member's opinion. However, the fact is that the tradition of the House simply provides for an opportunity of normal adjournment. No other business is appropriate at a time subsequent to the pointing to the clock.

HON. MR. GARDOM: On the same point of order, Mr. Speaker, I draw your attention to the Journals of the House for March 22, 1973, at page 171, which set forth the practice which is always followed, and certainly not the one that the Leader of the Opposition is attempting to thrust down our throats today.

MR. SKELLY: On the same point of order. Mr. Speaker, would it be possible to ask leave of the House — and I do ask leave — to have this matter brought up before the House at this time and to have your decision rendered to the House at this time?

MR. SPEAKER: This is a departure that's going to introduce into the House a procedure which we may well regret. Shall leave be granted?

Leave not granted.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 1:05 p.m.