[ Page 2577 ]

CONTENTS

Routine Proceedings

Committee of Supply; Ministry of Agriculture estimates.

On vote 10.

Mr. Barrett : 2577

Mr. Brummet –– 2581

Mr. Ritchie –– 2581

Mr. Cocke –– 2584

Hon. Mr. Hewitt –– 2586

Ms. Sanford –– 2589

Mr. Stupich –– 2590

Hon. Mr. Hewitt –– 2593

Appendix –– 2597

FRIDAY, MAY 23, 1980

The House met at 10 a.m.

[Mr. Davidson in the chair.]

Prayers.

HON. MRS. McCARTHY: I have two introductions today. First of all, on your behalf, Mr. Speaker, I recognize two members from the Delta constituency. I would like the House to welcome Mr. Dennis Elsom and Mr. John Sigurdson.

I know that all members of the House and each of our legislators will be extremely pleased to pay tribute to the legislative interns who are in our gallery today. I know that each of the interns in the gallery will feel the warmth of that reception on the floor of the House. May I just say that today, May 23, is the last day of service for the interns. They are graduating, having served all members of this House in a dedicated way.

The members with us today are: John Belshaw from UBC., Elaine Dunbar from SFU, David Larsen from UBC, Rod Mahrt from UVic, Cathy Mayoh from UVic, Geordie Proulx from UBC, Michael Shepherd from UVic, Greg Smith from UBC, and April Yamasaki from UBC. They are accompanied by Dr. Jeremy Wilson, and Clarence Reser from the Speaker's office, who have led them so very well in this internship program.

I would like to pay tribute not only to these interns but to those who have preceded them, to Dr. Jeremy Wilson, to Clarence and to others who have been involved in the program. The work that the interns have done gives them a tremendous opportunity for their future; but it also has given our legislators an opportunity to have extremely able and dedicated assistants. We thank them all and wish them all the very best.

MR. HOWARD: Mr. Speaker, of course I want to join with the Minister of Human Resources in expressing our appreciation for the program and our enjoyment at having had the opportunity these past few weeks to work with the legislative interns, to become associated with them and to enjoy their presence. Of course, we particularly come to know those who are associated with our particular caucuses — with special reference to John Belshaw, David Larsen, Michael Shepherd and April Yamasaki for having given us the pleasure of letting us work with them.

I am sure that during the first week in which the legislative interns were here, they may have wondered how it was that they came to be here in the first place. After that period of time they must have wondered how those of us who are on the floor got here. In any event, we have enjoyed the relationship. I'm sure all members of the House want to join in wishing the legislative interns a pleasant visit to Ottawa — where you will find things much different than they are here — and also in wishing you every success and every bit of luck in your years ahead.

Orders of the Day

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

ESTIMATES: MINISTRY OF AGRICULTURE

(continued)

On vote 10: minister's office, $129,448.

MR. BARRETT: Mr. Chairman, that's the first time I've chased the Premier out before he could even sign his mail.

For a few moments this morning, I want to raise one agriculture subject with the minister, and suggest to him that there may be another method of dealing with the problem of Cargill and Panco. The minister has made a mess of this situation. We all know the history of how this problem came about; we all know that at one time Panco Poultry was owned by the people of British Columbia, that its purchase by the New Democratic Party administration for $3.5 million brought some security to turkey and chicken producers. It guaranteed that those producers had a rational outlet not only for their production but also for the marketing of their production, and the processing of all poultry fowl was taken care of here in British Columbia through a guaranteed market. Because of an ideological hangup the minister decided he wanted to sell Panco Poultry. Instead of selling off the Liquor Control Board, which is socialism, or selling off B.C. Hydro, which is a debt-ridden corporation caused by the Columbia River fiasco, they sold off a money-maker.

I don't know why they arrived at the philosophy that the government must own only money-losers and sell off the winners, but that's what the decision was — let's sell off a winner. It was owned by the people of British Columbia for a little over three years. It was purchased for $3.5 million and sold, all told, for nearly $14 million. We made a profit of $10 million in a little over three years by holding that corporation on behalf of the people of this province. Of course, that's what the minister described as "socialism gone mad." The people were making money from something they owned themselves; he couldn't stand it. the government couldn't stand it, so they sold it to Cargill.

But there was a problem beyond the philosophical matter that we disputed in the purchase of Panco by Cargill. The member for New Westminster (Mr. Cocke) was the first one to raise it. He pointed out that Cargill was not associated with the United Way. Cargill is a multinational corporation that has a very bad reputation, both in Canada and in the United States, as being interested only in the corporation and not at all in the area in which it's operating. There's no need for me to catalogue the offences that Cargill has been accused of, and in many instances found guilty of, in the United States and Canada. But the minister clutched Cargill to his bosom, sold off Panco Poultry, and as the member for New Westminster warned, delivered a monopoly situation into the hands of Cargill, and Cargill began to act exactly as the member predicted. Not only did Cargill see itself buying the physical plant of Panco Poultry, but it was also buying a market.

[Mr. Strachan in the chair.]

If the minister was aware of the history of agriculture in this province, he'd be aware that the constituency he represents, and the surrounding areas, at one time had flourishing agricultural industries, in terms of products such as tomatoes and other truck-farm products that were processed in canning companies in the interior.

After the Second World War, the same pattern that Cargill displayed took place in that area in that American cor-

[ Page 2578 ]

porations came in and bought out the canneries. They weren't interested in the canneries at all; they just wanted to buy out the market. They shut down the canneries, the fields were put out of production, and we began our dependence on imported foodstuff from Mexico, California, and canned food from the United States. The minister was unaware of that, even though he lived in the area where that tragedy had taken place. But he did have people advising him and they were aware of how American corporations worked in the agribusiness industry. He was warned publicly about Cargill, and yet he went ahead because of an ideological hangup that the government shouldn't own Panco Poultry. When the member warned that Panco was buying a market, the minister paid no attention. The minister believed that Panco would come to British Columbia, join the United Appeal, become a charitable organization and become concerned about what the people of British Columbia needed. Nothing could be further from the truth.

The minister was another victim of an American corporation that had established a pattern of absolutely no concern whatsoever for maintaining the local marketplace structure. So what happened? Enter Panco. The member for New Westminster warned that Panco would slowly begin to throttle competitive outlets or producers and would slowly move into the marketplace and begin to expand a monopoly situation that they had into absolute control of the whole marketplace. What happened, Mr. Chairman? Within short order Maplewood, one of the major competitors of Panco, was forced by the marketplace and manipulated by Cargill into a situation of closure. I don't need to go through all the steps. We're all familiar with them. Then when Maplewood was forced into closure, its only salvation was that Cargill, now an octopus, should pick it up as another arm.

We have federal laws in this country about foreign intrusion into parts of the Canadian economy, and the Foreign Investment Review Agency has to give approval before a foreign corporation takes over a Canadian operation. Squeezed to the wall by Panco, which, was now owned by Cargill, and to save its own skin — and that's understandable — Maplewood applied to the Foreign Investment Review Agency to approve a sale of its facilities to Cargill. The original position of the Social Credit administration was a bland acquiescence saying: "Yes, it's okay. Let Cargill buy them." Is that not correct? I don't hear anyone who's opposed to that interpretation. The fact is that the minister's original position was a blessing to Cargill to become an even greater monster. When there was a bit of a public protest about this — and my colleague for Cowichan-Malahat (Mrs. Wallace) pointed out that the minister was in favour of Cargill expanding its control of the poultry industry in the province of British Columbia, in particular the turkey processing and marketing — the minister then pulled a switch. He said: "No, I'm not in favour now of Maplewood being purchased by Cargill. We need to find something else."

After weeks of fumbling and dithering and burnbling and confusion and avoiding the press in the corridor to explain his position on why he flip-flopped, he then came in the House and flip-flop-flipped. He went back to his original position and said the only way to save Maplewood now is to allow Cargill to buy it.

It is the typical acquiescence of a Canadian politician to an American corporation — throwing his hands in the air and saying: "I can't do anything about it." I may use the analogy, of course with humour, of the murderer who kills his mother and father, goes into court and pleads his defence on the basis of the fact that he's an orphan.

Who is it that caused this situation in the first place? That minister and that government created the situation where Cargill came in and interrupted the status quo and the balance. It was that minister who blindly sold off control of the influence in the marketplace to Cargill, and it is that minister who flew in the face of all knowledge about Cargill as a multinational corporation, saying they're going to become good B.C. citizens.

Fooled again. And why does that kind of fooling take place? Because there are certain Canadian politicians who believe that American corporations know best, that they really have our best interests at heart and they will do the nice thing that we want them to do, won't they? The minister himself was the first to be shocked to discover that Cargill didn't give a fig for his opinions. Cargill doesn't give a fig for the marketplace or the producers of British Columbia. Cargill is only interested in one thing — enlightened self-interest. How shocked the minister was to find out that corporations operate on enlightened self-interest. What a nasty blow.

The minister said no to Cargill after he realized that there was a public outcry against Cargill expanding its operations and getting almost total control of the industry. And then, after seeing that he couldn't come up with a solution, he went on to say: "Yes, Cargill should take it over."

That's a quick review of where we are today. I want to ask the minister a series of questions. Then I want to make some suggestions. I want to know from the minister how it is that the Minister of Tourism (Hon. Mrs. Jordan) can get out of cabinet $3.5 million U.S. to give taxpayers' money to a non-profit society in Victoria to lease a jetfoil for six months so that we can hire an American crew and fly an American flag to experiment with bringing in tourists, when he couldn't come up with a couple of million dollars to back up turkey producers on a guarantee to buy Maplewood. I want to know what it is that allows the minister to open a door for an American corporation with a history of squeezing out local competition, a monopoly approach to the marketplace, willing to pay a high price not for physical facilities but for the market value itself, and stand back and allow that corporation to tweak his nose and move off with every bit of the market in this province. You tell me how it is that the Americans can get $3.5 million U.S. from us to hire a jetfoil for six months and we're going to blow that money — and in the meantime you wink a blind eye to the situation in terms of helping the turkey producers.

Mr. Chairman, did the minister make any effort to sit down with the turkey producers and say to them: "Fellows, you raise some of the money. Go to the bank and see if the bank'll raise some more and we will back you from the B.C. Development 'Corporation."? Did the minister go into cabinet and say "Never mind blowing $3.5 million U.S. on a jetfoil. I need money to protect British Columbia turkey producers and I want that money for the turkey producers here in the province of British Columbia."? Not handouts, not grants, but a guarantee on the note to give those....

HON. MR. HEWITT: Like Swan Valley?

MR. BARRETT: Oh, I'm glad you mentioned Swan Valley. I want to, tell you, Mr. Minister, we're talking about

[ Page 2579 ]

Cargill now, and we're talking about your complete capitulation to Cargill here in the province of British Columbia.

AN HON. MEMBER: What about Swan Valley, Dave? Tell us about Swan Valley.

MR. BARRETT: Well, here they go.

I want to tell you, Mr. Chairman, now we've got their attention....

Interjection.

MR. BARRETT: Can I list the questions you want in my estimates?

HON. MR. VANDER ZALM: Just tell us about all the NDP disasters.

MR. BARRETT: Yes, the disaster was that we let you get nominated in Surrey. Any other questions?

Interjections.

MR. CHAIRMAN: Order, please. I will ask all hon. members to come to order.

MR. BARRETT: Thank you, Mr. Chairman, for protecting me from those vicious slings and arrows that we suffer in public life.

The minister has not made one single move to protect the turkey producers in this province. I'm going to make a suggestion to the minister, and I know he's listening. I know the minister is seeking intellectual companionship, but I'm asking him to listen just for a minute. Have you made any approach to the federal government and asked them to help the turkey producers with federal funding and financial, assistance programs? Would you, Mr. Minister?

I see a Liberal. No, it's Dr. Pat. Mr. Chairman, how's the exhaust pipe going there?

I ask the minister if he has made any effort to approach the federal government and ask them if they would be willing to guarantee a note to the turkey producers to help them buy Maplewood. Have you exchanged any correspondence or phone calls with Eugene Whelan and said to him: "We have a problem here, Mr. Whelan, and I think perhaps the two of us could guarantee a note for the turkey producers and save the plant?"

Mr. Chairman, I think the Minister of Agriculture had designs all along in allowing Cargill to take over Maplewood. His original proposal has always been the same: let Cargill expand, let Cargill do it. You know what the outcome will be if Cargill gets hold of Maplewood: the turkey producers of the province of British Columbia will be at their mercy. The next step that will happen.... I will predict the steps that will happen, because it's a pattern that's been repeated everywhere where Cargill has operated in the same business that's going on in North America: vertical integration. Have you heard of that, Mr. Minister? Do you know what vertical integration. Is in the agricultural industry? Just nod your head if you do. If you don't, I've got some sympathy for you. You haven't done your homework. If you do, you're falling victim to exactly what the pattern of agriculture has been in North America for 30 years.

Vertical integration will take place in British Columbia in the poultry industry. Cargill will get hold of Maplewood, begin to cut staff, cut production and slowly consolidate a market that they bought. Not the plants — they're not interested in the plants. They're interested in the market. It is cheaper to process poultry in the United States by adding an extra shift in existing Cargill plants or subsidiaries and beginning to flood the B.C. market at a competitive price, break the marketing boards in that industry, and then have the B.C. market to its own over the long run.

MR. RITCHIE: That doesn't work.

MR. BARRETT: It doesn't work?

MR. RITCHIE: Not under the GATT agreement.

MR., BARRETT: My dear friend, I'm glad to hear you say that. Now we're really getting into what the agreements are and what the realities are. When has any Canadian government had the guts to stop dumping of products, slowly at first, and then gradually, into the Canadian market? When was the last time we marketed tomatoes out of the interior of this province both for canning and public sale on a mass basis in terms of the market we served after the Second World War? I'll tell you what happened. My own father was in the business. The politicians at that time sold out B.C. and Canada just as they're selling out B.C. and Canada today.

MR. RITCHIE: Your statements are misleading.

MR. BARRETT: Mr. Chairman. I like that fellow down there, but he knows when to sell his business. You know when to sell your business, don't you? You bet your life. You can read the writing on the wall.

Vertical integration is now moving rapidly into British Columbia and the agricultural industry. Vertical integration will now overtake the turkey producers, and in ten years they will be lucky to have the memory, because that's the only thing they'll have left after the minister allows Cargill to take over Maplewood.

The minister mentions GATT. Of course GATT works when there are alternatives, but the minister overlooks one thing, and the member for Central Fraser Valley (Mr. Ritchie) understands it very well: GATT only comes into play when there is a competitive producer. If there is no competitive producer left anymore, GATT goes by the boards and the market is wide open to the American producer.

Let me show the member how the poker game works so he will understand. How you get around GATT is simply this: you cover the market for expanded production facilities that you have in the United States. The obvious expansion is a Canadian market. So you don't immediately dump into the Canadian market, because that's against GATT, and you'd get your hands slapped. So what you do is you go and buy out the Canadian production capacity. That's the first step. You get control of the Canadian production capacity, then you extend it by giving competition to cut out the few independent competitors. Maplewood's backed up to the wall. This is the classic....

MR. RITCHIE: It doesn't work. You're wrong.

MR. BARRETT: It doesn't work? It's exactly what's happening.

[ Page 2580 ]

Mr. Chairman, we bought Panco for $3.5 million. Three years later it sold for $14 million. It was bought for $14 million by Cargill, not because they wanted the plant; they were buying the market. The next move by Panco was to have a monopoly control of the market. The next move by Panco is to buy out Maplewood. The next move will be to cut back production here in Canada as they began to cut back turkey processing by cutting the price to turkey producers in the Fraser Valley.

HON. MR. HEWITT: Oh, oh!

MR. BARRETT: Yes! The minister sits there....

MR. RITCHIE: You're misleading and confusing.

MR. BARRETT: Mr. Chairman, I'm not misleading or confusing; I'm giving you a recitation of exactly what's happened so far.

HON. MR. HEWITT: You'd better get your researchers to do a better job.

MR. CHAIRMAN: Hon. members, please, during Committee of Supply all members are allowed to speak as many times as they wish, but they are not to impede the speech of a member who already has the floor. I will ask the Leader of the Opposition now to continue on vote 10.

MR. BARRETT: I want to thank the Chair for protection for a new member, Mr. Chairman. I have never been so severely repressed and harassed by such a capable bunch of hecklers in all my time here. I even heard a burp. Yes, even Fred is in the game.

Mr. Chairman, what has taken place today is that we have abandoned Canadian content and Canadian ownership in a very important segment of the industry. It's the same pattern of selling out our market, the same pattern of closing down our production facilities, and then the same pattern of a vacuum in the market caused by closing down our production facilities gradually at first, which overcomes the GATT agreement, and then that vacuum has to be filled by American products. What will happen is that Cargill, through its subsidiaries, will begin to flood the Canadian marketplace.

MR. RITCHIE: You're wrong.

MR. BARRETT: If I'm so wrong, why were you in such a hurry to sell out your business? You can see what the future is.

MR. RITCHIE: You know who bought it.

MR. BARRETT: I know about it too. I saw the same thing happen with tomatoes, with lettuce, with carrots, and the only thing that saved the lower Fraser Valley was the B.C. Coast Vegetable Marketing Board. For all those opponents of marketing boards out there who understand that their original purpose was to save what was left of Canadian production of agricultural commodities to serve the market of Vancouver and the surrounding areas.... I'm predicting the same thing is going to happen with turkeys and chickens.

It will be the responsibility of that minister if he allows the sellout. There is still time to stop it, and the way to stop it, my suggestion is, is for the minister to get on the phone to Ottawa and say: "I'm no longer supporting Cargill's bid for the purchase of Maplewood." I'd like a cooperative move by Ottawa through Eugene Whelan and through the government of British Columbia to guarantee the loans for the turkey producers. Let the turkey producers take the risk that they're willing to take, with a guarantee, and let us have some competitive marketing and processing going on in that industry in this province. Without that we're headed, within three years, to a complete monopoly of the whole marketplace, in terms of turkeys and chickens in this province, by Cargill. And then what will the minister do — wring his hands and say: "We couldn't stop it. It was too late"? It is not too late to stop it now. If it's good enough to provide $3.5 million U.S. to a non-profit society to bring jetfoil service into Victoria, then it's good enough to finance — or at least guarantee the notes of — a group of turkey producers in the Fraser Valley, so they can have an alternate outlet other than Cargill's monopoly situation.

I'll tell you, Mr. Chairman, the first warning was given by the member for New Westminster (Mr. Cocke), then the member for Nanaimo (Mr. Stupich) and the member for Cowichan-Malahat (Mrs. Wallace). But when the Vancouver Sun and the Vancouver Province get up and also attack the government on this very same argument — and they're not socialists; they used to support you — then, Mr. Minister, I believe that you're not a bad guy, it's just that you don't have any clout in cabinet. Somebody else can get $3.5 million U.S. for a high-flying jetfoil, but you can't get a guarantee for some Fraser Valley turkey producers. Why? And why haven't you gone to Ottawa and said: "Share in a guarantee with the turkey producers"? Have you tried that?

HON. MR. HEWITT: Sit down, I want to respond,

MR. BARRETT: Make a little note.

Have you tried going to Ottawa and asking for federal government help for financing the turkey producers? Mr. Minister, people are going to say you are weak.

HON. MR. HEWITT: No, they'll never say that.

MR. BARRETT: Yes, they are going to say it; I'll try to stop it. People are going to say you are indecisive; I'll try to stop it. Backbenchers are going to begin to covet your job; I'm going to try to stop that. Mind you, their own abilities are an inhibiting factor.

HON. MR. HEWITT: After your vicious attack, nobody would want it.

HON. MR. FRASER: Scurrilous.

MR. BARRETT: I woke up Alex. Mr. Chairman, I want to apologize to the Minister of Transportation and Highways for waking him up. We haven't done his estimates yet, and I've got a few problems in my riding. I separate you from the rest of the gang. You're one of the problems, but I love you, Alex. Whatever I say against that bunch doesn't include you, until I find out whether or not I got something out of you.

Mr. Minister, the farmers and consumers of this province are watching you over this issue. The consumers know that the fate of putting some of the staples of food on the table is being affected by your indecisiveness. The producers know

[ Page 2581 ]

that if you don't get out there and fight for them they are going to lose their investments in the marketplace, and the people of British Columbia are going to go one step further into the hands of an American corporation like Cargill that is totally committed to vertical integration. We will see the beginning of an even greater loss of independent producers from the agriculture business in the province.

Help, Mr. Minister. Rescue your image. Get on the phone to Ottawa. Get in the cabinet and fight. Save the turkey producers and save Maplewood without selling out to Cargill. Otherwise, you might as well let Cargill have your seat in the Legislature.

MR. BRUMMET: Mr. Chairman, it's always interesting to listen to the entertainment pitch from the Leader of the Opposition. He makes quite a practice of stating accusations or assumptions, trying to make them sound like facts or knowledge. He does it very well, and he is entertaining.

So much has been said about Cargill from that side of the House and it has been so one-sided. Far be it from an amateur like me to try to defend Cargill. I am not in a position to knowledgeably comment — that doesn't seem to bother some members, but it does me — on all the things that Cargill has done, a big company of that size. But I would like at least to bring to the attention of members and put on record that in the Peace River country Cargill did do something a little different from what those members suggest.

Some of you may recall that in October last year the B.C. Railway bridge over the Peace River burned. At the time a great deal of grain was sitting in the fields, needing to be shipped to market. It was a very drastic situation. The Highways minister and this government immediately put up a temporary Bailey bridge — it has been left in place and improved, but at that time it was considered temporary — to allow grain to be hauled from the north Peace area to the south Peace, across the Pine River bridge on the south side of the Peace. Of course the extra hauling from the elevators — instead of loading into railway cars — was an extra cost factor.

I called a meeting of the elevator companies in that area, plus the railway. I asked them to consider saving the grain that was out in the fields, because it was a burnper crop and some of that grain was rotting. The only saving factor was that we had good, dry weather so we didn't lose millions of dollars' worth of grain. I'm not talking about a big conglomerate; that grain belonged to the farmers at that time, and it would have hurt them.

I called this meeting of the elevator operators. I asked them if they would start hauling the grain and I said I would do whatever I could to convince the government to assist with this program. Within a short while this government agreed to pick up 50 percent of the extra cost of hauling that grain, which amounted to about 12 cents a bushel. From Buick Creek the extra hauling cost was 25 cents a bushel; the government would still pick up 50 percent, but it had to go through the elevator companies. Two growers' co-ops and Cargill were involved; those are the three elevator companies operating in the north Peace area.

I might say that after that meeting, when I said if they would start hauling I would do what I could to help, Cargill immediately started hauling grain. The growers' co-ops, despite all my contacts with them in Winnipeg, Edmonton, Calgary and so on, refused to do any hauling because they were only making 10 cents or 12 cents a bushel on that grain.

I could not get across to them the point that they should, as a growers' co-op, be serving their customers. The only company that started hauling and continued to haul until the rail line was replaced was Cargill.

Despite the fact that we have these emotional words such as "takeover" and "sellout, " and — as the Leader of the Opposition says — "squeezing out local competition, " I would like to suggest that in the North Peace River Cargill will pick up some more customers next year, not because of any squeeze tactics and not because of any elicit tactics, but simply because of the good business practice of serving their customers.

That one incident, which is all I'm able to comment on knowledgeably, is at least one thing that Cargill has done. It is not the big bad wolf, as those people try to make out because of some bad things that they have done, which I don't contest.

MR. CHAIRMAN: Shall vote 10 pass? The member for Central Fraser Valley.

AN HON. MEMBER: You should have been the minister.

MR. RITCHIE: No, I'm doing fine. Again I'm compelled to respond to the remarks made by the Leader of the Opposition because not only is it quite obvious that he's trying to create some great big monster here out of nothing, but it is also obvious that he doesn't understand what goes on in a marketplace or even understand the marketing system which they are supposed to endorse quite strongly.

Let me go back to 1975 when Maplewood Poultry was known as Willows Poultry. It was then owned by Canada Packers Ltd. Because of the involvement of the government of the day, they decided to close up. It was at that time that Mr. Hambley came along and attempted to purchase the facility. He had approached the government of the day who, at that time, through the Minister of Agriculture, indicated that there would be funds made available.

HON. MR. HEWITT: I'll be right back.

MR. RITCHIE: Don't be away too long, because I'd like you to hear this. It's obvious that you need a little lesson on some of our marketing schemes.

HON. MR. HEWITT: I'll be right back. Hold your breath.

MR. RITCHIE: Okay. We'll ramble around a little bit. He knows what went on there.

In any case, the government of the day, through the Minister of Agriculture, suggested that there would be funding available to get that plant opened up again, but it was refused. It didn't get the funding that was suggested. In spite of the fact that there were over 100 people losing their jobs and in spite of the fact that there were a lot of growers out there who didn't have a home for their product, the government of the day said: ''No, we're not prepared to put up any funding to reopen that plant." I know they were short of funds, but on many occasions I heard that they didn't worry about that. If they decided to buy something they'd buy it anyway and the funds would come from somewhere.

The main reason, I believe, they refused to put up the funding was that they were already in a position of controll-

[ Page 2582 ]

ing the poultry industry through the complete ownership of Panco Poultry, which was bought at a price that was in excess of what the owners at the time were prepared to, accept from a grower group.

What I am saying to our members over there, and to all the people in this House, is that the growers of the day had put in a lot of time and spent a lot of money investigating the operation and having it studied. They came up with an offer. The information that I receive was that the then Premier personally got into the act and he overbid them. I'm sure he's listening somewhere. He just doesn't want to stand the embarrassment in the House here. There are a few things that went on then that could make you feel very embarrassed indeed. I think some of the comments made by you today are a shame in view of what happened in the past. That can be dealt with later too, and you'll be getting yourself into another embarrassing hole but that's fine. You carry right on. I can take it.

The fact of the matter is that you said they had 100 percent ownership in Panco by this time and they were about 40 percent in Pan Ready. Together they decided that they were going to put some pressure on the turkey growers and make demands of them in regard to pricing and to grading.

What did they do? They came along together and they said: "This is what you growers are going to get, and this is the grading system that's going to be, and if you don't like it, we're not going to take your product." This was Panco Poultry, owned by government, and this was Pan Ready owned by the Pacific Co-op, 40 percent owned by government. They got together and they said: "We're sorry, you growers...."

Interjection.

MR. RITCHIE: Did you hear what I said?

HON. MR. VANDER ZALM: Repeat it. The socialist baby.

MR. RITCHIE: Well, I'll try to carry on here. I think he knows all this, and I'm sure he'll read it in the Blues. Anyway, you did interfere in the purchase of Panco Poultry with a price that was over and above what the owners of the day were prepared to accept from a group of growers, and you successfully negotiated the purchase of Panco Poultry for the NDP government of the day. You immediately found yourselves in the position where you realized that to reopen the Willows Poultry plant you'd be faced with some stiff competition, and your government refused to give any financial support to Mr. Hambley so that he might reopen it. And that is all on the record. You refused to support it, in spite of the fact that we had over 100 employees out of work, and in spite of the fact that we had a number of growers who were in a bad state because they had no place for their product.

But that wasn't enough, Mr. Chairman. They then continued to protect themselves....

AN HON. MEMBER: You're all mixed up.

MR. RITCHIE: I'm not mixed up, I lived through it. These are facts, I don't need notes.

But then to further protect themselves, Mr. Chairman, they went on and they got together the management of Pan Ready and the board — which at that time was under the chairmanship of Mr. Harry Liedktke — and they told them and the turkey growers: "We are not going to continue with this system of grading and we're not going to continue paying this price, and unless you accept our terms, we're going to refuse to take your product" — and they did refuse to take their product. The condition that the turkey growers find themselves in today, they were in in 1975 — caused by the NDP government of the day.

Now, had the Willows been left, alone, as was the desire of your government — and you, Mr. Leader of the Opposition — Maplewood Poultry wouldn't have been around today. But Maplewood Poultry is around, because Mr. Hambley on his own initiative raised the financing and got it back into production and put over 100 people to work and got the growers back into business. That's why, and you know it; you know it only too well. In fact, I'm sorry that we don't have the member for Cowichan-Malahat (Mrs. Wallace) here, because she was very much involved in that whole transaction as a member of what then was known as the superboard — not the supervisory board — because they had super powers. That member on that board made the demand on the growers, and told them, by signing an illegal agreement, that these were the terms that they would receive. These are all facts. And I'm sure you remember it, and if you don't, I'm sure the member for Nanaimo (Mr. Stupich) will remember it, because I had various meetings with him in that regard.

You talk about competition and why Maplewood failed. Well, I'll tell you why Maplewood failed. Not because of Panco and not because of Cargill. Maplewood failed only because of the marketplace. What the Leader of the Opposition does not understand is that periodically the B.C. market is used by other provinces for surplus product, and it so happens that there is a fairly substantial surplus of turkey in Canada at the moment and has been for some time — and this product, of course, can move west cheaper than it can move east. Mainly, of course, because of our unfair tariffs, we are a dumping ground. This is not to say that the product has been dumped at a price below their cost, but certainly at a price below ours, and that's what has caused the failure of Maplewood. It's simply a case of the spread between what they pay for the product and what they can get for it in the marketplace. They failed because of out-of-province competition. And I'm not defending Cargill at all; they can defend themselves.

But I want to tell you this, that the whole story from the opposition seems to revolve around the idea that just because there wasn't another buyer, this government should have stepped in and bought it. Well, I want to go on record as saying that I'm opposed to that, and most of the growers out there are opposed to that. Most of our farmers are free enterprisers, and that's why they're farming. They're not for government ownership; they know what government ownership can do to them, because it has already done it to them; they've already been hurt by it — by your personal activities they've been hurt. So don't get the idea that our farmers would favour this government or any other government buying that operation. They're opposed to it. They're opposed to your involvement, like they were back in 1975.

AN HON. MEMBER: The farmer from New Westminster wants to speak. We'll give him a chance afterwards.

[ Page 2583 ]

MR. RITCHIE: They're all farmers when it comes to a time when there's an opportunity to make some political points. I consider you to be riding on the backs of the farmers right now.

AN HON. MEMBER: Shame on the socialists!

MR. RITCHIE: If you knew anything about farming you'd be ashamed of some of the things that you have said. I listened to the second member for Victoria (Mr. Hanson) — I'm sorry he's not here — standing up talking about soils — Number 1 soil, 2 soil — obviously reading a paper that he didn't understand.

MR. BARRETT: What did you sell out for?

MR. RITCHIE: Why didn't he ask you. Because I recall when you stood out there on the soil and said: "Just because it's dirty it's not any good." You're farmers only because it's politically profitable for you at the time, but you're doing yourselves more harm than good.

Then you went on to talk about how the American product, through Cargill, can come in and depress and control our market. I've never heard so much hogwash in all my time. That's misleading information and you know it misleading the House.

MR. BARRETT: Mr. Chairman, he's attacking me. He's saying things he shouldn't say. You should know better.

MR. RITCHIE: Are you objecting to something I've said? What did I say that I should know better about?

MR. BARRETT: See, you don't even know what you said. Shame on you!

MR. RITCHIE: Mr. Chairman, he went on to talk about marketing schemes and how they're affected by GATT and so on and so forth. Well, again it's quite obvious he's playing games. He either knows and is twisting it, or he doesn't know. I prefer to suspect that he doesn't know.

But we have certain commodities in Canada that have come under a national plan, and I would suggest....

MR. BARRETT: And if they're not produced any more, then GATT doesn't exist.

MR. RITCHIE: You can get your turn again. And I would suggest that possibly you spend a little time with your member for Nanaimo (Mr. Stupich) because I'm sure that he's very familiar with the schemes.

But, Mr. Chairman, there are certain products produced in Canada that come under the national scheme. They are, at the moment, turkeys, chickens and eggs, and under that scheme only what was imported into Canada from the U.S. — the average of the previous five years — may be allowed in. Absolutely nothing is permitted beyond that, under any circumstances, unless a product is not available in Canada.

MR. BARRETT: That's it. Now you've got it.

MR. RITCHIE: What you're forgetting to say, or what you're purposely not saying, is that it's not a question of a processor controlling that. The grower decides that, not the processor.

MR. BARRETT: Don't be silly. If he has no processor, then he can't get his stuff to market.

MR. RITCHIE: Don't you kid yourself. I've got a few more things to say that will make you look....

MR. CHAIRMAN: Order. please. All members will come to order, please. The hon. member for Surrey, the Leader of the Opposition and everyone will come to order, please, The member for Central Fraser Valley has the floor.

MR. RITCHIE: I don't mind, Mr. Chairman. Let them heckle away: it's just fine.

But under the national scheme. commodity groups that are signatories to that determine what is going to be produced in Canada. That's determined by each province participating in developing the production plans for the coming year. Those plans are developed using the consumption of the previous year as a base and also taking into consideration what is allowed into Canada under the national scheme. What is allowed into Canada under the national scheme is the average of the previous five years. The processor has absolutely nothing to do with what is being produced in Canada unless he's into production. The only difference today, Mr. Chairman, from whenever the NDP were in power, is that they did have some power.

MR. BARRETT: He can stop processing,

MR. RITCHIE: He's only speaking from his own experience, because when he was in power he was in production at the expense of the independent grower. That's the experience he's speaking from. But that is not so today; we do not have any processors in production today.

MR. BARRETT: You sold out.

MR. RITCHIE: What do you mean we sold out?

MR. BARRETT: You know what I mean.

MR. RITCHIE: We said we'd give it back to the independent producers.

MR. BARRETT: To Cargill — that's what you did.

MR. RITCHIE: We can deal with that at a later date. But in any case you should realize. Mr. Leader of the Opposition, that Cargill or any other company or processor cannot control the market. That is done at a national level. Only if they cannot find products in the market will they allow products to come in from the U.S. And then it can only come in by way of a permit issued by the federal Department of Industry, Trade and Commerce. So all of the information that you have given this House this morning is absolutely wrong and misleading.

Mr. Chairman. I could go on here for a long time just reminiscing on the horrible experiences that some of our farmers had under the NDP government, but I don't think that's going to do us any good at all. It's very concerning when I sit here and listen to so many of them who have become instant farmers and suddenly know what's good for the farmer. Yet when they an opportunity to do what was

[ Page 2584 ]

good for the farmer, what did they do? They did what was good for them. They had power over it all.

[Mr. Hyndman in the chair.]

Mr. Chairman, I'll be glad to take my place again, if they wish to continue to mislead the House, but I hope that some of the points I made will get into the record.

MR. COCKE: Mr. Chairman, I rise with a heavy heart. These people will never learn. There can only be one answer for this province, and that's the rejection of Social Credit. After the debate we've had on Cargill, after the debate we've had on the botching of the whole Fraser Valley poultry industry, I can't believe that the member who ran a feed plant in that area and who was on the marketing board got up and gave us that kind of a speech and then said we're misleading the House. For heaven's sake! I'm not going to allude to his tactics in getting his nomination, but those tactics seem to be tactics that he's prepared to use even in debate.

AN HON. MEMBER: What's that got to do with Cargill?

MR. COCKE: I just want to talk about the history of Maplewood for a second.

HON. MR. VANDER ZALM: You're a hard-up Socialist.

MR. COCKE: You might very well listen to this, bright-eyed, bushy-tailed know-nothing tulip grower.

HON. MR. VANDER ZALM: You're showing your colours.

MR. COCKE: Yes, my colours are consistent right down the line. I've never been a Liberal or Conservative; I've always been NDP. Can you say that?

HON. MR. VANDER ZALM: You haven't got the brains to be anything but a socialist.

MR. CHAIRMAN: Will members who are speaking be kind enough to address the Chair.

MR. COCKE: Mr. Chairman, the member who's doing all the talking across the way equates brains with sitting in his seat and screaming.

Let's just go over for a second what happened. Maplewood came up for sale. Who put it up for sale? Canada Packers. It was looked at by our government, and we said that the deal was no good and why should we bail out Canada Packers? I think that's fair enough, I don't think you have to go and bail out poor old Canada Packers, who seemed to be quite well, thank you. I think they are.

Mr. Hambley came along and asked our government to give him some assistance in picking it up. We consistently said that it was not a good deal, so why should we help him or ourselves pick it up?

HON. MR. VANDER ZALM: Not a good deal for the socialists.

MR. COCKE: Not a good deal for the people of this province, and that's the job that we were doing.

So that's the story, Mr. Chairman. As far as I'm concerned, what happened was that he picked it up. Our studies indicated he shouldn't, but we had an alternative: we would either expand Panco...

AN HON. MEMBER: As Cargill promised to do.

MR. COCKE: As Cargill has promised to do since they've owned it. But, no, they've done it through the back door.

...or we would assist the co-op that owned Pan Ready. We would agree, providing we could negotiate a better deal on that run-down plant with Canada Packers. It was good business. Nothing less and nothing more.

Mr. Chairman, they would prefer to listen to their biased bleats, which don't mean anything in the face of what we have today in this province. What we have is the same old gang selling out to their American friends.

I was very interested this morning.... I don't think that anybody can put the C.D. Howe Institute in a position of being rather left-wing, could one? Would you, Mr. Chairman? Would you, Mr. Attorney-General? I don't think anybody in this room would. What did they say for Canada? If you want me to, I'll go through and quote the article. In general they said our economy was down the tube. Our economy is in real deep trouble unless we begin to develop a mixed economy and unless we get our economy back in Canadian control.

AN HON. MEMBER: And get the government to run everything?

MR. COCKE: Read it over nice and carefully, okay?

Interjection.

MR. COCKE: I suggest, Mr. Chairman, that the member re-read this article, because there's no question as far as I am concerned.

It also says:

"The failure of industrial and other government policies to stimulate an adequate technological base within private industry in this country and massive control of the technology abroad suggest that the government participation may be the only way to develop a distinctive technology in selected sectors. "

This particular area is a selected sector. So far as our party is concerned, we're not interested in wide control. What we're interested in is seeing to it that we repatriate our economy to Canadian control and develop an economy of our own that's developed here on a base of Canadian and not other economies.

Just for a moment I want to deal with Cargill. I wasn't going to say another word about this but, you know, I just can't understand how it is that people can be so supportive. The member for Peace River got up a little while ago....

AN HON. MEMBER: And told the truth.

MR. COCKE: You know, he said that up in the Peace River Cargill gets their support because Cargill were the people they could deal with. There's a nice book review that I would suggest that you read: Merchants of Grain. Read the

[ Page 2585 ]

book. It's heavy going. Mr. Chairman, in that book, Cargill is described as a corporation, one of the few, in that $50 billion industry in the United States. There are five companies owned by only seven American and European families. It's the most blatant example of an oligopoly in the world. The five companies, the giants of the world grain trade, are Cargill, Continental, Bunge, Louis Dreyfus and André. None is an old-fashioned enterprise such as each was when it entered the grain business a century or more ago. Today all are quintessential modern multinationals with extensive interests in shipping, banking, food processing, insurance, mining and practically everything else you can think of. But 50 percent of their business still consists of buying and selling grain. That gives you some idea of the power. They're in international politics....

MR. BRUMMET: So? They helped the farmers up there; that's all I said,

MR. COCKE: They'll help the farmers as long as it's in their interest, and then they will take the farmers and squeeze them as they have done everywhere they've been.

MR. BRUMMET: Garbage! At least they will let the farmers own the land, not rent it to them like you say.

MR. COCKE: Oh, Fred Flintstone and his own rent farm....

MR. BRUMMET: In this House you said to rent them the land.

MR. COCKE: You know, Mr. Chairman, I'm not going to stand for this kind of stupidity, even from him. What I said was that young people in this province today cannot afford to buy farms. Therefore this government that has a great deal of farmland should make some of that land available on a lease basis so that young people can get into farming. What's wrong with that?

MR. BRUMMET: Nothing. That's being done. You said rent them the land; don't let them own it. A socialist policy.

MR. COCKE: I just don't understand it. Mr. Chairman, I suggest that they do a little more work and a little more research.

Anyway, these large multinationals, particularly Cargill.... You'll notice that anytime they're described, Cargill is always right at the top. Cargill is a corporation with probably something in the order of $17 billion in sales last year, a corporation with three times the sales than we have budget in this province. I suggest that they've used this muscle in a very, very indiscreet and bad way in terms of world politics. Let me just give you something that's in that book:

"Their monopoly allows the United States government to use grain as a political weapon. Morgan cites Chile as a prime example where Allende took power; the U.S. cut off grain supplies to the country. After the 1973 coup, they restored their shipments. Their weapon is not only used against progressive governments, but has tied reactionary states to agricultural dependency on the U.S."

Cargill's habit, and they'll discover that in the north.... They're certainly discovering it in Saskatchewan now as far as grain is concerned. Incidentally, wheat particularly must surely be the most important food on the face of the earth; possibly next to rice. but certainly the most important grain food.

AN HON. MEMBER: What are you trying to say?

MR. COCKE: They've got it locked up, Mr. Member. If you don't understand that, then why don't you try to do something else that might be more in line with your own thinking?

There is no question that what they've done in the Fraser Valley is built themselves into a position where in short order they will control the poultry industry completely: not only in the way the Leader of the Opposition said. but they announced a very short time ago that they will be in the feed business within a year in that area. They will therefore be able to make the demand on the producers to "either deal with us or your turkey food or your chicken food is in jeopardy." That's the way they work.

MR. BRUMMET: Where the government runs the agriculture industry, in socialist countries, how do they do by comparison?

MR. COCKE: The member for North Peace River again shows his ignorance by talking about government running this, that and the other thing. I recall when we bought Panco Poultry for $3.5 million that they sold it for $14 million. How about that for government running something? Pretty well, eh? Pretty good profit and every year in between a profit was made by Panco Poultry. Not bad, eh, Mr. Member? And don't forget that when the government is running it, they are running it on behalf of the people. When Cargill is running it they are running it on behalf of two families in Minnesota, the Cargills and the Stewarts, that's all.

MR. BRUMMET: You don't understand.

MR. COCKE: I don't understand? I don't ever want to understand your kind of warped thinking. No wonder the school system has produced biased students. It takes an awful lot of education and a lot of reading for them to understand the bias that's been created by that kind of absolute stupidity.

HON. MR. VANDER ZALM: How much for a loaf of bread in Russia?

MR. COCKE: What the hell has that got to do with it. Vander Zalm? What a slimy statement! How were things in Hitler's Germany in your youth? What kind of statement is that?

HON. MR. VANDER ZALM: It's a question.

MR. COCKE: A dumb question. We don't believe in totalitarianism and we don't believe in corporate totalitarianism either. That's what we're talking about when we're talking about Cargill. We have no respect for the USSR, any more than you have no respect for the right-wing governments either.

Interjection.

[ Page 2586 ]

MR. COCKE: I'm not going to be in the parade tomorrow. I'm speaking to a thousand doctors.

Interjections.

MR. COCKE: Yes, they do, and it was all because of you. It was some time ago, Mr. Chairman, that he brought that up.

As far as I'm concerned, I would hope that this government will get their act together, withdraw their Foreign Investment Review Agency application asking — after some changes — that Cargill now be given the right to purchase Maplewood. It strikes me that up until a few days ago — and if it's changed I'm going to be surprised — the producers themselves were prepared to set up a co-op to process their own turkeys. That's what I've been given to believe, having spoken, as a matter of fact, to some officials of that organization that I rode over here with last week, on their way to see the minister. As far as I'm concerned, what better way? Then at least they have some kind of control of their own destiny rather than placing it in the hands of Cargill,

I don't think we have to go over Cargill's record again. I think I did that the other day. If anybody hasn't read that record, I don't really think they deserve to be making decisions. I'm talking about government people; they should not be making decisions about Cargill until they completely brief themselves with respect to Cargill's behavior. Cargill's behavior has been consistent, particularly since World War II, but even prior to that they were getting very, very heavy-handed and very much involved in creating monopolies and cartels wherever they went, so that they had total control.

That member would rather have two families in Minnesota having total control in our poultry industry than have all the people in B.C. having a say in it, and particularly the producers themselves and the consumers. I just don't understand that kind of thinking at all.

MR. BRUMMET: If we follow your line of reasoning, then you're guilty of the worst socialistic practices in the world, because they happen elsewhere. Isn't that what you're saying?

MR. COCKE: I just don't understand why you don't stand on your feet and make an argument.

MR. BRUMMET: I did.

MR. COCKE: Yesterday he told us that he was stunned. This morning, when he got up to say that Cargill was doing good things, he proved it — when he made that statement about Cargill and their beauty in the north. Look at the corporation you are dealing with before you make too many statements in terms of their integrity.

MR. BRUMMET: That's why I'm against socialism.

MR. COCKE: What a nonsensical statement!

AN HON. MEMBER: He could be in the classroom.

MR. COCKE: That's right. At least having him here we are doing a justice to the education system in B.C.

Mr. Chairman, I believe that the government should give us an indication of whether or not they have really taken this whole question about Cargill seriously, whether or not they have really looked into that corporation. Because if they have not, I think they are jeopardizing the industry. They are forsaking the people they are indicating they want to protect, and placing them at the mercy of a corporation that within two or three years will be dictating all the policies within two or three years in terms of turkey and poultry production, the feeding of the industry and the processing at the other end. Guess who will pay. The consumer, of course. Actually, the producer and the consumer will pay. And Cargill will get richer and sassier as a result of our silly policy of always trying to confirm the interest we have in private enterprise rather than looking after the people's interest.

If government's job is not to look after the people's interest, we shouldn't bother having government. That's the only real role they play. If, under certain circumstances, you have to get involved in the marketplace, so what? They don't mind getting involved in the marketplace when they tell CPR that they can't come in here and take over MacMillan Bloedel. CPR happens to be a Canadian corporation, at least. But, by heavens, to give an American outfit like Cargill the right to come in here and take over! Incidentally, before they made that decision up there, they gave the right to Weyerhaeuser in the United States to take over the whole forest area in central B.C. — no problem. But when it became a political problem, they stopped the CPR. It's not consistent.

I say, for the sake of the people in B.C., for heaven's sake, show some courage now — Mr. Chairman, through you to the Minister of Agriculture — get up there and say we are going to assist the producers to get their own act together.

I agree with you; I agree with those who say that Maplewood is not a particularly viable situation. It wasn't a viable situation when it was dumped by Canada Packers in the first place.

HON. MR. HEWITT: Mr. Chairman, on the last comment made by the member for New Westminster in regard to its not being a viable situation in the first place, the fact is that in 1975 the purchaser of that plant, Mr. Hambley, came to the government and was given some assurance that he would receive $1.5 million.

AN HON. MEMBER: What kind of assurance?

HON. MR. HEWITT: It was reported in the paper that the Minister of Agriculture was prepared to assist. The comments are not by me but by the then owner of Maplewood Poultry. They turned him down. Yet today they are standing up, and we're not talking about $1.5 million but about $6.5 million — in regard to the cost of the plant and the inventory, which the members know full well is a problem in the poultry industry at this time. We're talking about the improvements required — about $1.5 million. We're talking about working capital to meet the purchase of turkeys and chickens coming in from the farms.

I would like to say that the member for Central Fraser Valley (Mr. Ritchie) certainly assists me a great deal. The opposition must be aware of that by now, in their comments regarding the history of the poultry industry in this province.

I had forgotten about the socialist involvement in the poultry industry. We talk about Cargill getting in and getting a percentage of the marketplace. When that organization

[ Page 2587 ]

over there bought Panco Poultry in 1974-75, they acquired a major processor in this province. They also got involved in a 40 percent equity position with Pan Ready. Basically, the government was moving towards a dominance in the marketplace.

I have to tell you that the people of the province and of the world had better understand just where socialism leads you. Those people over there can talk about jobs and about assistance and stepping in when there is a problem in the marketplace or in industry. But the people of the province should look beyond that facade and look at just what the intent is. I can assure you the intent is total socialism for this province, which is control of industry, control of commerce and control of finance in this province. We could get onto the move that they were going to make with the B.C. Savings and Trust Corporation, and I could tell a lot of people's stories about their moves. They were going to use the credit unions for five years and then dump the credit union movement in this province — a good cooperative movement. Their intention was to set up a savings and trust corporation in this province, use the credit unions as agents, and at the end of a five-year term — they're famous for five-year terms in all their contracts — they would have taken the business away from the credit unions; they would have dumped the credit unions, opened up their own offices for B.C. Savings and Trust Corporation and literally wiped out the credit union movement in this province.

They know it and they know I know it, because I sat for seven years on B.C. Central Credit Union's board and I was fully aware of what they were doing. The only reason I came into politics in 1975 — because I didn't have any aspirations to be a provincial politician; I was happy in the credit union movement — the only reason I'm here today, I want you to know, is because of your move to socialize the credit union movement in this province. That's why I'm here today, and that's why I'll stay here — to make sure that you people don't get back into office.

HON. MR. VANDER ZALM: Not everybody wants to be a civil servant.

MR. HOWARD: Quit telling falsehoods.

HON. MR. HEWITT: Well, let me put it this way: I'll stake my future on that, if you want to comment on a falsehood. I felt I had enough concern about the credit union movement that I was prepared to leave a job, leave a community, and come to Victoria to speak out on behalf of my people in my riding and the rest of the people in this province, and the credit union movement in this province. So if I based that on a falsehood, I would be as confused as you seem to be all the time.

I just want to answer some of the questions that the Leader of the Opposition raised in regard to.... He said that Maplewood was manipulated by Cargill and forced to close. Now this is a statement from the Leader of the Opposition. Well, he knows he's totally wrong. It seems to me that Cargill was the willing purchaser and Maplewood was the willing vendor of the company; and here we're saying that Cargill is forcing Maplewood to close. I can tell you that Cargill's main concern in this whole exercise was to get approvals from FIRA and from the federal government in order to purchase the plant before it would be forced into receivership.

MR. STUPICH: And that's a willing vendor — one that's forcing receivership?

HON. MR. HEWITT: It's a willing vendor and a willing purchaser, Mr. Chartered Accountant from Nanaimo, as you well know. And you well know that if it's put into receivership, you're not dealing then with the vendor: you're dealing with the receiver. But then, again, you're not too swift on those things anyway. I think you've been that route; as a matter of fact, I think it was in the poultry industry, if I'm not mistaken.

It was the high inventories and the high costs of production that caused the Maplewood problem and caused Mr. Hambley a lot of his problems. The Leader of the Opposition mentioned that Maplewood was "squeezed to the wall'' by Panco. Well, I'm not sure where he gets that, nor how he could elaborate on it. He makes statements like that, and he has nothing to back them up: but I guess it gets on the record and he has a good performance in the House. He knows full well — or he should — that there are millions of pounds of turkey inventory in this province and in Canada. Panco experiences a high inventory of processed birds, the same as Maplewood did, and the members opposite know — or at least the former Minister of Agriculture would know — that the purchase price of the live product for processing is the same to Maplewood as it is to Panco or to any other processor, because the marketing board determines the price of the product that is purchased. So the cost of the birds is the same for all.

In regard to the comments about FIRA and the government's position, when we first objected to the purchase, as I read into the record yesterday — and I won't read the actual documents, Mr. Chairman — Pan Ready Poultry had advised Ottawa that they were in a position where they could purchase Maplewood Poultry. They had their financing arranged and they were carrying out discussions with the owners of Maplewood. That was received by Victoria, and we had indication from the broiler producers and the turkey producers that they would prefer to see the plant purchased by Pan Ready Poultry. Within a week of that Pan Ready withdrew their offer, and I reported that to the House.

From that point on we dealt with the turkey producers, and we dealt with the owner, in an attempt to find a Canadian buyer. As I think the Leader of the Opposition and the members opposite would know, any Canadian and any British Columbian would like to see the ownership of a B.C. company or a Canadian company retained in Canada. We were unsuccessful. How far can you go in attempting to resolve a problem when, as I said before in this House, Maplewood is the tip of the iceberg? My primary concern is those 50 turkey producers and 100 or more broiler producers in this province that have to be dependent on a processing plant to handle their live birds. With this plant shut down it caused a serious lack of capacity in this province for the processing of birds.

The Leader of the Opposition raised a question regarding the Ministry of Tourism getting $3.5 million U.S. for the ferry service between here and Seattle. Just to go over what we've done in the Ministry of Agriculture with regard to resolving or attempting to resolve Maplewood Poultry Processors' problem: although they withdrew from the Clearbrook offer, Pan Ready still proceeded with the offer to purchase the Sooke plant. The Ministry of Agriculture work-

[ Page 2588 ]

ed with the Pan Ready people and the owner of Maplewood, and within a very short period of time completed agreement under ARDSA for $750,000 to assist Pan Ready in purchasing the Sooke plant, which was about to shut down. That's under our current programs. It is a forgivable loan based on the continuance of that operation over the next five years. Under our ARDSA program, similar assistance is available to other agriculture endeavours. They will have no special treatment, possibly, but the expediting of the application to assist in purchasing this plant.

We've also moved to get a $500,000 loan guarantee for the turkey producers — the B.C. Turkey Marketing Board — in order for them to work with the receiver of Maplewood Poultry in Clearbrook to re-open that plant. I can say, Mr. Chairman, I'm hopeful that that plant will be re-opened by the receiver next week. We now have the funding in place and the program set up so that hopefully the plant will be re-opened by the receiver, the birds will be processed and some of the backup on the farms will be taken care of.

The Leader of the Opposition asked if there was any effort made with the turkey producers with regard to purchasing that plant. I don't know where he is in this House when questions that are raised by members of his party are answered by me. I guess he's out or asleep. He's asking me the same question asked of me before, about which I've made comments in this House during my estimates. Yes, we worked with the turkey producers, and in the end they were able to advise us and to raise $200,000. The total cost to get that plant operational was about $6.5 million.

The members opposite may say: "Well, where did you get your figure of $6.5 million?" I can tell them we got it through a consultant's report by Woods, Gordon, who very quickly responded to our request to do a detailed analysis to give us the facts and figures on what it would take to operate that plant. That's where the figures came from.

So there was a $200,000 investment on $6.5 million total purchase price and operating costs of that plant. If you look at the party opposite's approach of a loan guarantee, can you imagine the debt service costs that those turkey producers would have to carry over the next years? They would be in an unfortunate position, because they couldn't service their debt, and they would never be able to look at anything other than an operating loss. In effect that is what caused Mr. Hambley to determine that he was either going to sell the plant or close it: because of his carrying cost and some of his financing.

The Leader of the Opposition raised the question: "Did you make any approach to the feds?" The answer is yes — which I've mentioned before. We've made an approach to the federal people, to the FIRA people, the Hon. Herb Gray, the Hon. Eugene Whelan and Senator Ray Perrault. We are expediting as quickly as possible the consideration by FIRA. The offer to purchase by Cargill — I can inform the members that the documents have already gone down to Ottawa. We have also worked with the Department of Agriculture in Ottawa to acquire some of this excess inventory in British Columbia, and we are having good cooperation with that.

With regard to Cargill's dominance in the marketplace, which the Leader of the Opposition raised, first of all, we have the B.C. Turkey Marketing Board, which can direct product. As the member for Central Fraser Valley said, it's a national supply management scheme. First of all, you do have a considerable amount of protection under that supply management scheme. The B.C. Turkey Marketing Board has the ability to direct product to processors. Also, the Cargill people, in their offer to purchase Maplewood, made a commitment to FIRA that they were prepared to reduce their percentage of turkey kill in this province, should the marketing board so desire, and that's in writing to FIRA in Ottawa with a copy to me.

Then, I think, the Leader of the Opposition raised the question: "Do you know what vertical integration is?" He was referring to Cargill and the fact that the multinationals look to vertical integration. Well, Mr. Chairman, again we'll go back to the 1974-75 purchase of Panco Poultry. You want to talk about vertical integration? This is a move that the government of the day made to "protect jobs." What they're so upset about is vertical integration and multinational companies. What I'm concerned about is when government gets into vertical integration and controls the marketplace. We've told you that they owned all of Panco and 40 percent of Pan Ready, but in Panco it included a feed mill from which they supplied their own farms — they owned seven turkey farms and four broiler farms. Those were tenant farmers on that land owned by the government, operating those turkey and broiler plants, using the feed to grow the birds to supply the socialist processing plant. That, to my way of thinking, is vertical integration, which they're so upset about. But it's different when the government owns it; it's no problem.

They also acquired a great amount of land, and they know — and I'm sure the former Minister of Agriculture is going to comment or speak on this; at least I hope he will — that the growers out there were upset because of the pressures that Panco was putting on them. Because the B.C. Turkey Marketing Board was under limitations, the B.C. Broiler Marketing Board was concerned about the size of production units that the government had in Panco. There was considerable concern out there, Mr. Chairman. But the most interesting thing — the one thing that I can't understand, considering the debate that's gone on this House over Panco in the past years — is that not only did they own seven turkey producing farms and four broiler farms — well in excess of the quota allocations laid down by the Natural Products Marketing Act of British Columbia and the marketing scheme under that act; well in excess of individual farm operation — but that government-owned vertically integrated company was in contravention of their own act and the scheme which they agreed to in the allocation of quota to farms. They had seven times the family farm unit allocation and quota for turkeys and four times that allocation for broilers, but they don't mention that.

So when we came along the Leader of the Opposition said: "The purchase of Panco by Cargill for $14 million! You've made $10 million on this deal." That's what they say. Well, I've got to say that that's not quite accurate either because the value of the processing plant in the accounts receivable was approximately $6 million. We came along and we sold it. They talk about selling it to Cargill for this $14 million — that's what they were saying this morning. We took that Panco Poultry — that socialist-owned company — and sold the feed mill to a B.C. owner. The Heppell Brothers of the Fraser Valley bought the feed mill. It went back to private enterprise and I'm proud that it did. It got it out of government hands. What government was doing in the feed business I'll never know, but it got it out and it was sold to a B.C. owner.

We took those seven turkey plants and those four broiler farms, and we sold them to seven turkey farm operators and four broiler farm operators. They purchased those plants.

[ Page 2589 ]

They were back in individual ownership; no longer tenant farmers working for government, but back into individual ownership. We put them up to open bid. We didn't sell them to anybody individually. We put them up, had tenders on them and sold them in the open market.

We took the excess land and we sold that. Then we sold the "processing plant" — the vertically integrated part of that government- owned operation — to Cargill. They had an expansion program lined up. They got approval from FIRA and they were to proceed, only to find that when they wanted to expand they ran into zoning changes and couldn't expand in Surrey.

I wasn't going to comment on this today because I thought it was fairly well covered in the last three or four days of my estimates. However, the Leader of the Opposition raised it and other opposition members have felt the need to comment on it and comment on the sale of Maplewood to Cargill so I thought I should respond and set the record a little straighter than they've attempted to do.

I thought we'd still be on ICBC this morning. After yesterday I was going to announce that it was the Minister of Agriculture's estimates, because yesterday I had a quiet day. Everybody else was doing the talking. It seems that today we got off ICBC and onto agriculture,

The member for New Westminster (Mr. Cocke) talked about the turkey producers wanting to set up a co-op or a company. That is correct. Although it's old news, he's correct. Yes, we did have discussions in my office. We did attempt to see whether funds could be raised so they could purchase that plant. In the end the turkey producers said they couldn't proceed, they couldn't raise the funding required even though they would have funds available to them from the government under our present programs. They just couldn't raise the funds required to get that plant in operation.

In the end, the Broiler Marketing Board, the broiler producers' association, the Turkey Marketing Board, the turkey producers' association, and Pan Ready have all come to government and notified government by letter, by telegram, by phone call: "We are withdrawing our objection to FIRA and support the Cargill purchase of Maplewood." Basically the government, after exploring all avenues, all alternatives to this sale of the Maplewood plant, adopted the same position — that we would withdraw our objection to the Cargill purchase of Maplewood because primarily, as I mentioned earlier, my concern is the maintenance and the growth of a turkey production industry in this province. The Maplewood plant is only the tip of the iceberg of the total industry in this province.

[Mr. Davidson in the chair.]

Let's be realistic: a processing plant needs product to operate. If you're going to invest several millions of dollars to purchase a processing plant, then it seems somewhat unrealistic to do away with the producers that would be providing you with that product. Therefore, I fail to see the total impact on the producers of this province, because the quota allocation is to the family farm unit, both on turkeys and on chickens, so Cargill can't get into the position of getting 50 percent of the production of birds. They are only in the processing. Under Panco, when it was government owned, the government had that massive amount of production under government ownership, contrary to the marketing supply-management program of this province under the B.C. marketing scheme.

I may have talked too long. However, I wanted to try to get as much of the story out, for about the third time, as I could this morning. Now maybe we can move on to other things that I know the members opposite wish to discuss, with regard to agriculture or ICBC.

MR. LEA: I would like to ask your permission....

HON. MR. VANDER ZALM: We've missed you for a whole week.

MR. LEA: You've missed me! I've missed you too.

I would like to ask leave to introduce some guests.

Leave granted.

MR. LEA: This is the member for Prince Rupert's week. Yesterday I said it's not too often that we have visitors from Prince Rupert because of the difficulty of travelling to the capital. But every year a social studies class from Prince Rupert comes down to watch democracy in motion. Today we have students from Prince Rupert, along with their teachers, in the gallery. watching democracy take place. I would like to ask you to join me in welcoming them to the legislative precincts.

MS. SANFORD: The minister has again been on his feet to defend his position with respect to the sale of Maplewood to Cargill. I think it's tragic.

HON. MR. VANDER ZALM: He doesn't have to defend anything; he's just setting the record straight.

MS. SANFORD: Already the Minister of Municipal Affairs.... As soon as we mention the word "Cargill" he cannot retain his seat or sit quietly. He is very edgy and very touchy about this particular issue. I wish the Minister of Municipal Affairs would join the rest of them over there and jump to his feet and defend Cargill. It really is tragic that elected members in the province of British Columbia get up one after another to defend a multinational corporation like Cargill, which is invited by the province to come in and purchase Maplewood here in B.C. It is a tragedy. They obviously do not understand what is involved with a company the size and the magnitude of Cargill corporation.

Why don't they instead make money available to those producers, so that they themselves can get in and purchase that Maplewood plant? Here we have representatives of the government in British Columbia running down to Ottawa, and appealing to FIRA to allow the multinational Cargill to come and purchase a plant here in British Columbia. Mr. Chairman, that's tragic.

We have had information from a number of speakers on this side of the House with respect to the influence, the manipulation and the tactics used by that particular company. It controls and manipulates all over the globe. It is in a position where it can determine whether people shall eat or not eat. It is a murky company. The people who tried to get information about the control of grain and grain sales throughout the world — people like Dan Morgan, who wrote The Merchants of Grain — had great difficulty getting information of any kind about the kind of manipulation that

[ Page 2590 ]

takes place in the field of the growing and export of grain. It's an incredible story. That we in British Columbia are welcoming the participation of a company like Cargill in this province.... This government doesn't care. They're prepared to sell out. Mr. Morgan mentions Cargill more than any other, because it's probably the most dominant of the five dominant companies involved in grain sales. He asks why these companies are so dominant. Why is it that they control $50 billion worth of sales every year? He says that the obvious answer is their massive investments in the transportation, loading, shipping and processing of grain, and, of course, its distribution on all continents. But that's only part of the reason, as Dan Morgan, the author of this book, discovered as he delved deeper into this murky, secrecy shrouded world — secrecy-shrouded because the funds for expansion and diversification come from within the company empire or from the banks. They never get involved in issuing stock to the public, because they want the whole field to be murky. They don't want people to know what's going on in the way in which they manipulate and handle and profiteer.

We cannot expect that Cargill's going to behave any differently in British Columbia than it has in any other part of the world. Mr. Morgan, who wrote this particular book, found out that each of the five companies involved maintains an elaborate network of reporting stations. And it is precisely this possession of up-to-the-minute global information which others, including governments, don't have. That's why they are so successful in the manipulation and sale and control of the grain markets. It's a tragedy, Mr. Chairman — that's the way I feel about this situation — that any government in British Columbia would run to the Foreign Investment Review Agency and appeal to have Cargill purchase part of this province.

It's over two weeks since we started discussion on these estimates. At that time I raised another issue with respect to foreign ownership and foreign control. That is the foreign ownership and control of farmland in this province. The government has made no move on this issue in the four years since they took office in 1976. It has been collecting information which has been gathering dust over in the land titles office.

I was interested in some information that was published in the Kelowna Courier on May 1, 1980. If nothing else, I hope that this will spark the Minister of Agriculture and that government to do something about the sellout of our land to absentee foreigners — our farmland, right in this province. I've already put onto the record, Mr. Chairman, on a number of occasions, the information with respect to the sellout of land in the Peace River to absentee foreigners. But on May 1, in the Kelowna paper, there is an article that refers to the foreign purchase of farmland in British Columbia. I'd like to read part of this article into the record.

AN HON. MEMBER: Who wrote it?

MS. SANFORD: J.P. Squire, who is on the staff of that paper.

" 'A sizeable number of West Germans, still living in their native country, are making hefty investments in Okanagan Valley real estate,' Larry Ferster, regional manager for A.E. LePage Western Ltd. said today."

Hefty investments are being made in the Okanagan Valley by absentee foreigners.

Larry Ferster said:

" 'The current weak condition of the Canadian dollar in relation to the German mark and the favourable exchange rate gives the Germans a terrific advantage for investment in Canada rather than in Europe. Land has always been a very good hedge against inflation, and it's very limited in supply. Canada and the U.S. represent the last frontier in free enterprise for absentee foreigners who wish to purchase land.'

"As a result, Larry Ferster says" — and he's quoted here in the Courier — his real estate company "has advertised quite a bit in West Germany in the past four to six months with a terrific response from absentee foreigners who are responding to ads put in by Canadian real estate firms advertising in various parts of the world."

It's fine for absentee foreigners to come in and own our land and make decisions about what's going to be grown here, how and when. It's fine for Cargill to come in and purchase and run the poultry and turkey industry — no problems at all.

Interjections.

MS. SANFORD: I beg your pardon. Mr. Chairman, the one thing about this is they're very edgy on this issue. They've been jumpy all morning. First it was the member for North Peace River (Mr. Brummet), the Minister of Municipal Affairs (Hon. Mr. Vander Zalm), and the Minister of Agriculture (Hon. Mr. Hewitt), and now the Premier can't contain himself when he hears about these things.

This real estate agent up in Kelowna, Mr. Chairman, is saying that he has witnessed purchases of $500,000, $1.5 million and $2.3 million in sales recently in the Okanagan Valley. The government takes no interest in this. They are prepared to allow the farmland of the province to be sold out to whoever wants to buy it. Whether they're interested in farming or not is not an issue. Whether there is going to be any food production here or not is not an issue. They don't mind if companies like Cargill make decisions about what happens in terms of the poultry and turkey producers of the province — no problem, let them buy it out. If they think they can make a buck, they are prepared to sell out the province. We've seen it time and time again.

Over two weeks ago I raised this issue about the absentee foreign ownership of farmland in this province. The Minister of Agriculture in that two weeks has not yet made one comment on that issue. I'm hoping, Mr. Chairman, that he will comment this morning.

MR. STUPICH: Mr. Chairman, I was wondering whether or not the Minister of Agriculture will be available for discussion of his estimates. Will he be back this morning?

Interjection.

MR. STUPICH: I'm sorry I missed the remark from the Attorney-General (Hon. Mr. Williams), Mr. Chairman. If it's worth commenting on then you'll have to repeat it. It's certainly not a very productive morning.

I don't intend to say a great deal about Cargill or about Panco this morning in spite of the invitation from the Minister of Agriculture to talk about Cargill. There is one remark I'll make, but I'll wait until he returns. He did issue another

[ Page 2591 ]

invitation and several of his colleagues followed up the invitation by asking us to talk about Swan Valley. We've had a couple of invitations and opportunities to talk about Swan Valley in the past, but the government has always backed away from it or tried to back away from it.

Interjection.

MR. STUPICH: The Premier is amused. You'll recall that there was legislation on the order paper — I want you to hear this, Mr. Chairman; I appreciate they're not interested, but I want you to hear it — I believe it was in 1976 that would have given us an opportunity in second reading of that legislation to discuss thoroughly the government's involvement in Swan Valley, to discuss thoroughly the opportunity that was lost to the people of British Columbia when the government sold out British Columbia in disposing of Swan Valley in the way that they did.

However, the government ran away from that opportunity, withdrew that legislation from the order paper, and handled the matter of financing quietly, after the House had adjourned, when there was no opportunity for us to have this kind of discussion in the chamber. There had been various comments across the floor, as there have been now, but that's all. There was no opportunity to discuss it unless we wanted to do it under the minister's salary.

Last year we chose not to debate the minister's salary at any length at all because we knew the minister had absolutely no interest in the Ministry of Agriculture. He had proven that in the past. Certainly the cabinet has shown its lack of faith in that minister by five times overruling his recommendations in agriculture.

I see the minister is back now. I'm pleased that he is before I get really involved in this Swan Valley thing.

HON. MR. HEWITT: Boy, I'm glad you mentioned this one.

MR. STUPICH: He says he's glad I mentioned it. Mr. Chairman, that's really odd because there was an opportunity to discuss Swan Valley in public accounts in 1977. At the time, that Minister of Agriculture did everything possible to delay that meeting or to delay the appearance of witnesses at the meeting, witnesses who knew something about Swan Valley and who could appear before the committee and answer questions. His obstructionism was so apparent that I made a point of dictating a memo to the committee detailing the discussion between that minister and myself and describing his attempts to stop the public accounts committee from examining the witnesses that were there to tell us about Swan Valley.

In spite of his attempts and in spite of his telling me in the conversation we had that all 11 members of the Social Credit group on the public accounts committee would be unable to attend if we were going to talk about Swan Valley....

When we finally had the meeting, nine out of the 11 Socred members suddenly found it convenient to attend, but then took up over half of the meeting trying to stop the committee from dealing with Swan Valley. This is all in the Hansard minutes of the public accounts committee. The total meeting is reported on 121 pages. The first 61 pages of the Hansard report of that meeting were taken up with stalling — largely led by the Minister of Agriculture — in an attempt to stop the committee from examining the Swan Valley directors. Then the last few pages are taken up with business of the committee. Somewhat less than half the meeting, because of the stalling of that member, was taken up in dealing with Swan Valley.

I did want to make one comment on Cargill. The minister expected I'd be talking about Cargill and I'll simply say this. For that minister, who professes to be something of a financial man and tells us about his wide experience in credit unions, to tell us that a deal between the largest family-owned corporation in the world — and one with, I suppose, about the worst reputation — and a person who owned another corporation which was within hours of going into receivership was a deal between a willing purchaser and a willing vendor.... I really don't understand how such a narrow-minded person can be so thick-headed as to describe that kind of a deal as a reasonable deal between two willing people.

To get back to Swan Valley, because I have really been looking forward to the opportunity to talk about Swan Valley in this House. I looked forward to it in public accounts, and in spite of the actions of the Minister of Agriculture we did get some information out of that meeting.

AN HON. MEMBER: The whole truth.

MR. STUPICH: Well, the whole truth is in the minutes, and if the minister really wants to, he can look it up in the minutes of the meeting. I can read from it, and if the minister really wants me to and really encourages me to then I may indeed refer to the answers to questions that were given at that meeting. The answers were not challenged; the answers were accepted by the committee.

The Swan Valley system could have been something really good. The minister boasted about selling it, disposing of it. Part of it was sold to Hardee Farms, and to the best of my knowledge the Creston plant is operating. We have not had a report from the House. This will be an opportunity....

HON. MR. HEWITT: I'd be glad to.

MR. STUPICH: Okay, any time you want to stand up and tell us about that, I'd like to hear about it. Do you want to do it right now?

HON. MR. HEWITT: I want to give you enough rope.

MR. STUPICH: Well. honestly, I just don't know what's happening in Creston. The member isn't here now. I don't know how the Hardee Farms operation is going. I understand the deal was that they were going to operate it for three years and if, at the end of that time. they hadn't stolen all the technology and learned everything they wanted to know and moved everything to Ontario or wherever.... If they still wanted to operate, I think they were going to pay some more money or.... I just don't recall the details of the Hardee Farms acquisition of the Creston one.

With respect to the Standard Brands acquisition of the Richmond plant, again, I don't know what's happening. The minister did tell us in a press release put out August 26, 1977, that "Standard Brands Ltd., one of Canada's largest food processing companies, will acquire all the shares." It still had to receive some approvals. I

On December 1, 1977, he announced that everything was complete, and announced some of the details — certainly not

[ Page 2592 ]

all of them, I would think — but he did say that Standard Brands was acquiring the Richmond facility for $3.2 million, was going to pay only $0.2 million down, would assume accounts payable of $0.4 million, and the balance of the purchase price was to be payable within three years. I don't know if that was within three years of the December date or the August date, but I'd appreciate knowing. He also told us that this sale of the Richmond plant to Standard Brands would result in the Richmond plant operating with a substantial increase in manpower. I'd be very interested in finding out whether there has been the substantial increase in manpower promised to us by the Minister of Agriculture when he put out this release on December 1, 1977.

Is the Richmond plant operating? Is there a substantial increase in manpower? If it is operating, where's the product going? Because certainly I haven't seen any of it. I don't go shopping that often, but I do shop occasionally in food stores, and I have not seen any of the product since, I think, late 1976. However, the minister told us in December 1977 that it would operate, that there would be a substantial increase in the manpower at the plant, and that we could look for great things, presumably, from private ownership.

Is that something about the Richmond plant? I'd kind of like to hear about the Richmond plant. Help yourself. Do you want to get into the debate now?

Mr. Chairman, the Premier is offering to stand up and speak. If he wants to enter the debate at this point, I'm quite prepared to yield as long as we don't pass the vote, because I don't want to have the government once again get us out of this discussion on Swan Valley until we've had some time to discuss it. So if the Premier is serious and he wants to get up, he has simply to rise and I'll yield very quickly.

Here is a letter from Mr. Piper to me shortly after the time I resigned as a director of.... I wrote a letter. Of course, with the change in government I realized that my position on the board was not something that should be continued. I did resign as a member of the board of directors, and I received a letter from Mr. Piper, the president of the company, dated February 10, 1976. I'd like to quote briefly from this letter. "Although we have been beset by development problems associated with the new technology" — and indeed it was new technology, and I have some more to say about that — "inflation" — and you'll recall that we were going through a period then of very high inflation for two years....

HON. MR. BENNETT: You were government then.

MR. STUPICH: Yes, that's when we were government. I suppose the Premier is suggesting that we were responsible for inflation not only in British Columbia but in Canada; not only in Canada but in the whole of North America; not only in the whole of North America but in the whole of the western world; and not only in the whole of the western world but also in the Middle East, where the oil was coming from — and OPEC was quadrupling the price of oil in the period of one year. I suppose he credits all of that to the actions of the NDP government, in saying that we....

HON. MR. BENNETT: All I'm saying is that at that time we had the highest inflation in Canada.

MR. STUPICH: Mr. Chairman, the Premier is interjecting that inflation in B.C. was higher at that time than it was in any other province. We were in office for a period of 39 months, and there were months when we were higher than the rest of Canada and there were months when we were lower. I would remind you that....

HON. MR. PHILLIPS: Name the month you were lower.

MR. STUPICH: Mr. Chairman, in July 1974....

AN HON. MEMBER: You were lower? We'll check it out.

MR. STUPICH: Be my guest.

Interjections.

MR. CHAIRMAN: Order, please. Hon. members, the member for Nanaimo has the floor and should be afforded the courtesy that....

MR. STUPICH: Mr. Chairman, I would remind you also that when Canada entered the anti-inflationary program announced by the Prime Minister on Thanksgiving, the one province in Canada to take immediate action to freeze prices was the province led by the NDP administration — British Columbia. It was the only province which announced an immediate freeze on food, energy and drugs and put it into effect. I remember attending a meeting of....

Interjections.

MR. STUPICH: Mr. Chairman, if any of these people really want to enter into the debate, I'm quite prepared to yield. I'll wait until you recognize them, but if they do want to get up and speak.... Otherwise, they can keep chattering from their seats. It's safer, they're not recognized, and they make their inane comments, some of which are picked up by Hansard, but none of which are credited to the idiots who are voicing them, so we can't refer to them afterwards and say: "Well, this is what this particular hon. member said." They prefer to remain anonymous. I suggested earlier that the Minister of Agriculture was narrow-minded in being so thick-headed and it appears he is not alone in that regard.

However, we were the one province that acted immediately to freeze food prices, drugs, energy costs. We did try to do something about the inflation that was a problem in the whole world. However....

Interjection.

MR. STUPICH: The Premier obviously doesn't want me to talk about Swan Valley. He's trying to get me off the track. As the Minister of Agriculture did everything within his control to stop the public accounts committee from talking about it, as the government did everything in its control to stop this kind of discussion in the House by withdrawing the legislation that would have invited that discussion, now the Premier keeps interrupting hoping that I'll forget that I was going to talk about Swan Valley. They don't really want to be reminded about the disservice they did to B.C. agriculture and to the people of B.C. in dumping Swan Valley the way they did. The Richmond plant would have been operating today, had the NDP been re-elected in 1975, and would have been a success by now.

[ Page 2593 ]

HON. MR. HEWITT: Just like IOK Poultry and South Peace Dehy.

MR. STUPICH: Well, Mr. Chairman, somebody over there — I guess it's the Minister of Agriculture again — would rather remain anonymous when he's making these comments than stand up and say them.

MR. CHAIRMAN: The Minister of Agriculture on a point of order.

HON. MR. HEWITT: No. I'm sorry. I thought he yielded.

MR. STUPICH: Yes, I do.

HON. MR. HEWITT: I just didn't want to remain anonymous, Mr. Chairman.

I want to comment on the involvement in some of the disasters in the field of agriculture, and Swan Valley certainly is a prime example. IOK Poultry and South Peace Dehy. The track record of the former Minister of Agriculture is pretty poor.

I wasn't going to get into too much detail on Swan Valley because I wanted the former minister to make his statements, and then I wanted to be able to respond and sort of cap the conversation. If he'd allow me that privilege before 1 o'clock I'll wait until he finishes his comments. Will you nod your head and allow me that privilege? He wouldn't do that. He's not nodding his head. Well, I can do it on Monday because I'm sure we'll still be on my estimates on Monday. I'll let the member continue.

MR. STUPICH: The Minister of Agriculture asked whether or not I would yield and let him make a statement. I've already indicated that any time the Minister of Agriculture or the Premier or any of the other people over there who chatter in their seats want to stand up and speak in this debate, I'm quite prepared to yield to any of them. Until such time I intend to talk about Swan Valley.

If I could once again try to read this letter dated February 10, 1976, from Mr. Piper to show you what position Swan Valley was in at that particular point in time just about two months after the election: "Although we have been beset by development problems associated with the new technology" — and it was new technology; not brand-new in the world, but certainly improved technology in the province of British Columbia — "inflation and delayed equipment deliveries" — which I've already discussed at some length at the Premier's invitation.... You will recall, Mr. Chairman, that was something that was facing all of industry in British Columbia, Canada and the western world. Things were moving along so fast then that everybody suffered from delayed equipment deliveries.

Interjection.

MR. STUPICH: Again, the Premier, who prefers to chatter from his seat rather than to enter into the debate, suggests that I'm making excuses. What I'm doing, Mr. Chairman, is reading from a letter. It does offer some explanations. The Premier may categorize them as excuses if he likes.

To go back to the letter:

" The Richmond project has been on the market since January 28." — that would be of 1976 — "We launched with 12.000 cases and we are presently back-ordered at about 5.000. Production yesterday was 600 cases at 1:30 p.m. We will receive our Continent Can line next week" — deliveries for things like that were still held up — "and will soon reach 1,500 cases per day on one shift....?

HON. MR. PHILLIPS: Was that before or after you pumped that last S5 million in?

MR. STUPICH: Mr. Chairman, the Minister of Industry and Small Business Development who, again, prefers to be seated and not be recognized when he's asking questions or making comments, asks about the date of this letter. I've already said that it's dated February 10, 1976.

HON. MR. PHILLIPS: I said was that before or after you pumped that last $5 million tax money in.

MR. STUPICH: Mr. Chairman, the minister is again preferring to ask his questions seated and he's asking whether or not this is before or after we pumped $5 million into something. If he doesn't recall the date of the election, I'll remind him. It was in December 1975 and the letter I'm quoting from is February 1976. It doesn't take much mental ability for even that member to determine that that must have been after we had any authority to put any money into anything. But if not, perhaps some of the other members would explain to him that having been out of office for two months, we were in no position to put $5 million into anything. So explain it to him.

Interjections.

MR. STUPICH: Did we spend any money?

Interjections.

MR. STUPICH: Mr. Chairman, I have two questions. First, was this after we had any authority to spend money? I would point out again that this letter is dated February 10, 1976, beyond any time....

Interjection.

MR. STUPICH: Yes, I know. but I am trying to explain to him that we obviously did not have the authority. We had no authority in February 1976.

HON. MR. BENNETT: You said you had no authority after the election.

MR. STUPICH: That's not what I said. Mr. Chairman, for the sake of Hansard, it is the Premier who is asking questions and trying to put words in my mouth. He is quoting me as saying that we had no authority to spend money after the election. I said, to assist the Premier to help the Minister of Industry and Small Business Development understand that in February 1976 we certainly had no authority, that we did have authority until we handed over the reins of government

[ Page 2594 ]

on December 22, 1975. We had authority to conduct the government and to spend money....

Interjections.

MR. STUPICH: Mr. Chairman, the Premier is expressing some surprise....

Interjections.

MR. STUPICH: Mr. Chairman, we're not going to hear very much about Swan Valley today at this rate.

Interjections.

MR. CHAIRMAN: Order, please, hon. members. The member for Nanaimo has the floor. The cross-comments are making it very difficult for the member to continue his debate with any kind of continuity. I would ask members to allow the member for Nanaimo to continue his points of argument with the Minister of Agriculture.

MR. STUPICH: The Premier is suggesting that we had no authority to spend any money after the election. As the Premier knows, it takes a few days to turn over the reins of government. Certainly the government of the day — whatever that government is, whether it has been defeated in an election or not — not only has the authority but has the responsibility to continue collecting moneys that are due to the government, and to continue spending money in the interests of keeping government functioning, until such time as there can be an orderly change in administration.

We did that in 1975, just as the previous Social Credit administration, led by his father, did in 1972. That election was on August 30, I believe, and the administration was turned over on September 15 — some 17 days later. It didn't take us that long to change over. Certainly the previous Social Credit administration continued to raise and spend money as long as it held office, even though it had been defeated in the election. Certainly the NDP administration continued to raise and spend money and control the government until such time as we could turn it over in an orderly manner.

To get back to the letter — this all started because the Minister of Industry and Small Business Development was asking whether or not this letter was dated after we had put more money into Swan Valley. It is obvious from the date — February, 1976 — that we were in no position to put any further money into anything at that time. Unfortunately, from the point of view of Swan Valley and the people of British Columbia, we were in no position to do that. Had we been in a position to do it, then Swan Valley would still have been operating.

It would have been a real credit to the farmers who originally proposed it, to the University of British Columbia for their assistance in developing the technology, the work that was done by the Food Science department at the University of British Columbia in improving — as I said earlier, not coming up with a brand new process, but rather improving an existing one. I made a point of looking into Swan Valley to some extent. I have a letter — again, certainly dated after we left office — from the 1977 AIC-CIFST conference in Guelph, Ontario, Canada. It's addressed to Swan Valley. This is the explanation of the initials.

"On behalf of the awards committee of the Canadian Institute of Food Science and Technology, I am pleased to inform you that Swan Valley Foods Ltd. has been selected to be the 1977 recipient of the Gordon Royal Maybee Award. This award is in recognition of an outstanding applied development by a Canadian company or institution in the fields of food production, processing, transportation, storage or quality control."

Then it goes on to say when the award would be made. Certainly the process was something that was years ahead of anything that was available anywhere else in the world. Dr. Powrie, who was the head of the Food Science department at the University of British Columbia at that time, did tell us something about the process and how it compared....

HON. MR. MAIR: NDP hack!

MR. STUPICH: Well, Mr. Chairman, the Minister of Health who wants to enter into this debate, like so many of his colleagues, while he's sitting in his chair, describes Dr. Powrie as an NDP hack. I don't know anything about his politics. I've never heard of him being a member of the NDP.

Interjections.

MR. STUPICH: I have never heard of him.... I didn't hear it properly, but I would think that if this government was going to do anything in the way of food technology — I can't imagine them doing anything constructive — but certainly if they wanted to, they could do worse than to go to the head of the Food Science department at....

AN HON. MEMBER: They used him....

MR. STUPICH: They have used him. Certainly the Minister of Health....

AN HON. MEMBER: Money down the rat hole!

AN HON. MEMBER: That's not what Pat thinks.

MR. STUPICH: That UBC...? Mr. Chairman, the Minister of Health, again, says that money going to the university is money going down the rat hole.

In any case, Mr. Powrie was asked about the Swan Valley process at this public accounts committee, once we got beyond the stalling tactics led by the present Minister of Agriculture (Hon. Mr. Hewitt). He was asked whether or not the pouch process was a new one. He replied that, well, it was new as far as British Columbia was concerned. It was new to Swan Valley. It was originally developed by Continental Can in the '50s, so it's not something brand new. But it was first developed by Continental Can, an American company, in the '50s.

It didn't get very far. It was ultimately picked up by an Italian company — interestingly enough, a government controlled company. In any case, they thought the process did promise interesting developments. They picked it up in about 1967 and started working on it. On the whole of the North American continent, in this little corner of British Columbia, Swan Valley was the first to market a pouch product.

Dr. Powrie was asked whether or not it's been accepted in other parts of the world, and he pointed in particular to Japan

[ Page 2595 ]

where 500 million pouches were sold in 1976. Obviously it was catching on there.

I have another document here somewhere that predicted that it would be into the billions by 1980. I'll come across that. I haven't got time now to really get into it. The Minister of Municipal Affairs (Hon. Mr. Vander Zalm) welcomed me reading further from Hansard. I'll leave that for the moment.

I'll go, instead, to The Agrologist. This one is for December 1978. "The Retort Pouch. New Technology. " Even in December 1978, fully a year after the government had sold out its last interest in this process, The Agrologist was writing about the pouch process as "new technology." It is still relatively new. "The first pouched foods appeared on the North American market in November of 1974 and were produced by a Canadian firm, Swan Valley Foods Ltd." This goes on to say that early development work was initiated by Continental Can in the U.S.A. It was in 1959, 21 years ago, that they first started working on it. Afterwards the U.S. Army — Natick Laboratories — began a research and development program to determine whether the flexible pouch could replace the rigid container for field combat — "one that was light in weight, less bulky and compatible with the pocket, thereby making it easier to carry and safer, while providing a safely preserved, ready-to-eat, nutritious meal." It goes on to name other companies that were interested in the process. Large, well-established companies were interested in getting in on the process. Swift's, Pillsbury, Rego and the FMC corporation aided in this early development.

Here's a little more about the technology that this government gave away — under the heading of quality:

"The pouch provides superior quality in the prepared food. Texture, colour, aroma and flavour are comparable to a freshly prepared home product. The pouch eliminates the typical canned flavour of heat processed foods and the blandness of certain frozen products. Delicate flavours and natural freshness may be best retained in the pouch. Fruits, for example, may be prepared without added sugar syrups and the fruits still will provide an organoleptic response of the crunch of apples, the vine flavour of blueberries. etc. The home cooked quality is possible with the pouch because of the relatively short processing times required to sterilize in the thin pouch profile."

It goes on to discuss the pouch from the point of view of product diversity, nutrition, convenience, food safety, longevity, storage conditions, shipping, handling and warehousing, institutional convenience, waste disposal and cost benefits. In every one of these headings, it talks optimistically about the retort pouch as new technology which, of course, is supported by the award that I referred to earlier when the award was given for that year to Swan Valley Foods..

There is an article here from a magazine called Food Product Development, and it's dated July-August 1977: "To date, retortable pouches are possibly the most important development in food packaging since the introduction of the rigid can 150 years ago." Mr. Chairman. that's the process that this government gave away to Standard Brands. "Shelf life of retort pouch products is equal to or better than metal cans. Refrigeration or freezing is not required by packers, retailers or consumers."

The same article, under the heading of "Consumer Acceptance...." It's quite lengthy, but I'll just read a portion of the last sentence: "Consumers, when given free choice of canned or pouched rations.... Out of 608 meals, 536 selections were pouched products." There was a free choice of canned or pouched, and by a very large majority the consumers preferred the pouched product.

Continental Can conducted a home placement study with 315 women receiving three different packages of prepared chicken a> la king: a can, a non-refrigerated retort pouch and a refrigerated retort pouch. The two pouches significantly outperformed the can on every dimension studied. A hospital patient feeding study resulted in 80 percent of the patients rating pouched products very acceptable.

I've just marked a few of the quotations. Reynolds Metals conducted two independent consumer studies, one by Sidney Hollander and Associates of Baltimore in 1969, and the other in 1976 by Yankelovich. Skelly and White of New York City. Both of them showed the retort pouch as being extremely acceptable. Better than nine out of ten respondents had favourable pre- and post-use comments about the retort pouch products.

Environmental impact: an environmental impact statement concludes: "The retort pouch has significant energy and environmental savings compared with traditional food container systems."

Marketing potential — and this is the reference to Japan: Japan's sales were 500 million pouches in 1976, when it was just getting started. European sales amounted to approximately 40 million units. I had an opportunity to sample some of the European product and found it not nearly as tasty as the product being produced by Swan Valley.

Another area of concentration might be the recreational field. It goes on to suggest what uses there might be in the recreational field.

In the midst of all this diversity. one aspect of the retort pouch receives agreement from everyone. It is potentially the most significant food packaging opportunity of this century. And it is one that this government gave away.

Dave Heinz of Reynolds Metals concludes:

"Opportunity is what the retortable pouch is all about: the opportunity for a food processor to market products at frozen food prices and canned food costs, the opportunity for a retailer to get uncommonly high returns on shelf-stable items, and the opportunity for the consumer to have access to a true value — an extremely convenient food product, fairly priced, that also is high in quality. For years many have speculated as to what course the retortable pouch would take. The opportunity is now at hand. Beyond speculation it is up to the food processors, machinery manufacturers and package suppliers to take the challenge."

I think there can be little doubt, Mr. Chairman, that everything you read about the process itself was positive. It was being widely accepted in other markets. The product available in those other markets was not nearly as good as the product that was being produced in B.C., because of the excellent work done by UBC, in particular by Dr. Powrie.

Swan Valley was looking beyond the immediate market available in B.C. — and in Canada. for that matter. There was worldwide interest in the superior quality that was available because of the technology that had been developed in the province of British Columbia. During the whole of the development period. the one concern that the directors of Swan Valley had, the one concern that was uppermost in their minds, was their determination to protect their technology as long as possible. They negotiated at great length with the

[ Page 2596 ]

Irish Sugar Company, the company that is involved to a very large extent in food and agriculture in the Republic of Ireland and which largely controls the import and export of food products to and from the Republic of Ireland. They have a lot of food processing within the Republic of Ireland and they were very interested particularly in the french-fry frozen product. They were anxious to get the technology, anxious to make some kind of an agreement with the directors of Swan Valley. It was a concern of the Swan Valley directors that they not enter into any agreement until they could be sure that they were going to get paid something for the use of their technology. They didn't want to lose control of the technology.

This government, when it sold out to Hardee Farms and said, "in three years, tell us whether or not you want it, " gave Hardee Farms three years in which to take all of that technology back to Ontario, if they wanted to, and check on Creston or whatever.

The minister has promised to tell us what's happening with respect to the Creston plant. This government, in selling out the Richmond plant, gave.... Standard Brands, the company which wanted to get into Swan Valley in the very beginning but wanted to end up owning everything that the farmers had, was pushing the farmers out completely. It was only because the farmers were being so hard-pressed by Standard Brands, who wanted, not to buy anything but to get something for nothing, as they did from this government practically.... They came to the government to see whether there was any possibility of getting any support from us. They didn't want this very excellent process that had been developed by British Columbians in British Columbia to be sold out to an American corporation. Unfortunately, the results of the election in 1975 meant that that was doomed to happen.

Swan Valley directors had discussions with a great many companies and countries. They were talking with officials from Tehran, Iran, and they had almost reached agreement when they were let down by this government. The terms of the agreement being negotiated called for a down payment of $500,000 in cash — and certainly that was easy for them to come up with — royalties at the rate of 1 3/4 percent on gross sales for the first five years of production, and royalties at 1 percent of gross sales for the second five years of production.

This agreement resulted from a visit to Iran following a visit of an Iranian official to the Richmond plant, where he saw what was happening and had an opportunity to try the product. He was excited enough about it to recommend this kind of contract to his officials, and it was being prepared. Blueprints for construction of the facilities had been sent to Iran. They were that far along the road to reaching a final agreement. One problem was, of course, that they wanted different foods for different appetites. They wanted entrées developed that would use rice as the base. Lack of government support, after the defeat of the NDP in 1975, held up development of studies of rice products required to make it possible for Swan Valley to conclude the contract with Iran.

[Mr. Hyndman in the chair.]

The agreement was actually signed on March 30, 1976, and it called for further development work. This work, unfortunately, wasn't followed through. Prior to this agreement being signed, negotiations were being carried on with a second company in that same country, one involved presently in the frozen foods business, which saw the advantages, particularly in a country like that, of getting out of frozen food and getting into the retortable pouch. There was a story in the Province on April 7, 1976, headlined: "Iran Buys Fast Foods." It's a story about a visit of an Iranian official and an announcement of the signing of a letter of intent.

"Company officials announced signing of a letter of intent with Nader Bijarchi of Tehran, Iran, for use of the company's retortable pouch foods system. Swan Valley vice-president Jack Wilks, who spent a month in Tehran recently, said: 'Bijarchi operates a national chain of quick-food outlets in Iran and is a principal in other major business ventures.' The B.C. Company will supply the pouches for Iran for a period of ten years and will receive a royalty on sales in addition to half a million in cash."

The newspaper story goes on to say that this move into the Middle East may be only the first of a number.

"Currently negotiations are going ahead with a private industrialist in Kuwait who has ordered 100,000 sample pouches of food for trial distribution among the armed forces, schools and hospitals in that tiny but rich Persian Gulf nation."

With respect to Kuwait, officials there, in discussions with the Swan Valley directors, showed interest in handling the product for the whole of the Arabian peninsula, including Iraq, Saudi Arabia and the United Arab Emirates. Again, the discussions called for product development of a rice-based entrée that was just not followed through because this government withdrew its support of Swan Valley.

Preliminary discussions were held at the Richmond plant with an official from Pakistan who was involved in fisheries in that country. Fisheries is another product....

Interjection.

MR. STUPICH: Mr. Chairman, these people insist on speaking from their seats, and I can't hear them.

Interjection.

MR. STUPICH: I'm being invited to move that the Chairman rise, report progress and ask leave to sit again.

Motion approved.

The House resumed; Mr. Davidson in the chair.

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

Hon. Mr. McClelland moved adjournment of the House.

Motion approved.

The House adjourned at 12:56 p.m.

[ Page 2597 ]

APPENDIX

11 Mrs. Dailly asked the Hon. the Provincial Secretary and Minister of Government Services the following questions:

1. What was the number of persons employed in both established and temporary positions in the Public Service as at February 29, 1980?

2. What was the number of persons employed in both established and temporary positions in each of the B.C. Buildings Corporation, the B.C. Systems Corporation, and the B.C. Ferries Corporation as at February 29, 1980?

The Hon. E. M. Wolfe replied as follows:

17 Mr. Barnes asked the Hon. the Provincial Secretary and Minister of Government Services the following questions:

As sports consultant, what are Mr. Eric Whitehead's terms of reference and cite the authority under which this appointment was made—

1. At what salary will he be paid?

2. What is the duration of his appointment?

3. Was there a competition for the position?

4. If the answer to No. 3 is "yes," who were the other applicants?

The Hon. E. M. Wolfe replied as follows:

"The contractor will act as a special sports consultant to the Ministry and will (a) act as a direct personal liaison between the said Ministry and all sport-governing organizations throughout the Province, including Sports B.C. and the B.C. Ski Council, (b) promote relations between the Ministry and those organizations, (c) examine problem areas related to the foregoing and make recommendations to the Ministry and the organizations, (d) advise the organizations on ongoing sport-related programs, and (e) as and when directed by the Ministry, undertake and perform, on behalf of the Ministry, such other tasks and functions related to the Ministry's sports, recreation and cultural programs.

"The authority for this appointment rests with the Minister and the Treasury Board, to expend funds provided by the Supply Act.

"1. $2,000 per month.

"2. 12 months.

"3. This is not a position and there was no competition."

31 Mr. Hanson asked the Hon. the Provincial Secretary and Minister of Government Services the following questions:

1. Are any files kept on employees in the Public Service other than a ministry personnel file and a Public Service Commission personnel file?

2. Are there any files maintained which contain information of a personal or confidential nature about Public Service employees?

3. If the answer to No. 2 is ''yes," then do employees have access to all such files to review or correct such information?

[ Page 2598 ]

The Hon. E. M. Wolfe replied as follows:

"1. Those are the only individual files that are kept on all public servants.

"2. Yes.

"3. In the Ministry of Provincial Secretary and Government Services, any such files are open to inspection by the employee concerned and any correction will be received and placed in the same file. I am unable to answer for other individual ministries. "