[ Page 2851 ]

CONTENTS

Routine Proceedings

Oral Questions.

Northeastern coal development. Mr. Lauk –– 2851

Pension amendments. Mr. Hall –– 2853

Committee of Supply; Ministry of Education estimates.

On vote 54.

Hon. Mr. Williams –– 2853

Division on the motion that the committee rise –– 2853

Residential Tenancy Amendment Act, 1980 (Bill 21). Committee stage.

On section 2.

Mr. Levi –– 2854

On the amendment to section 2.

Mr. Levi –– 2854

Hon. Mr. Nielsen –– 2854

On section 4.

Mr. Levi –– 2855

Hon. Mr. Nielsen –– 2855

On section 13.

Hon. Mr. Nielsen –– 2855

On the amendment to section 13.

Mr. Levi –– 2855

Hon. Mr. Nielsen –– 2855

On section 15.

Mr. Mitchell –– 2855

On the amendment to section 15.

Mr. Mitchell –– 2856

Hon. Mr. Nielsen –– 2856

On section 44.

Mr. Levi –– 2857

On the amendment to section 44.

Mr. Levi –– 2857

Hon. Mr. Nielsen –– 2857

On section 45.

Mr. Cocke –– 2857

Hon. Mr. Nielsen –– 2858

Ms. Brown –– 2858

Hon. Mr. Nielsen –– 2858

Mr. Levi –– 2859

Hon. Mr. Nielsen –– 2859

Ms. Brown –– 2860

Hon. Mr. Nielsen –– 2860

Mr. Cocke –– 2860

Hon. Mr. Nielsen –– 2861

Mr. Hyndman –– 2861

Mr. Cocke –– 2861

On section 48.

Mr. Levi –– 2862

Hon. Mr. Nielsen –– 2862

On section 49.

Hon. Mr. Nielsen –– 2863

On the amendment to section 49.

Mr. Levi –– 2863

On section 51.

Ms. Brown –– 2863

On section 55.

Ms. Brown –– 2864

On the title.

Ms. Brown –– 2864

Report –– 2864

Consumer Protection Amendment Act, 1980 (Bill 14). Second reading.

Hon. Mr. Nielsen –– 2864

Mr. Levi –– 2865

Mr. Leggatt –– 2867

Mr. Lea –– 2868

Mr. Howard –– 2870

Mrs. Dailly –– 2871

Mr. Mussallem –– 2871

Mr. Nicolson –– 2872

Mr. Lorimer –– 2872

Mr. Cocke –– 2873

Hon. Mr. Nielsen –– 2873

Consumer and Corporate Affairs Statutes Amendment Act, 1980 (Bill 16). Second reading.

Hon. Mr. Nielsen –– 2874

Mr. Levi –– 2874

Erratum –– 2875

Appendix –– 2875

The House met at 2 p.m.

[Mr. Davidson in the chair.]

Prayers.

HON. MRS. JORDAN: Mr. Speaker and members of the House, seated in the members' gallery this afternoon are two very special guests of British Columbia: Mr. and Mrs. Millard Davidson, who are the first family of Pasadena and the Rose Bowl Society of Pasadena. Earlier today Mr. Davidson presented our province with a trophy in recognition of British Columbia's float which depicted our cultural and ethnic diversity and was viewed by 140 million television viewers last New Year's Day, and by many more as the year has passed.

Accompanying Mr. and Mrs. Davidson is Mr. John Plul of the Ministry of Tourism, our new assistant deputy minister, who I'm sure all members will be keen to know designed that float.

Later this afternoon I'll have the honour of presenting the Davidsons with the book The Art of Emily Carr on behalf of all of you and the citizens of British Columbia. In the meantime, I would ask you to give them a very warm welcome, and I would say to them on behalf of all members and our Premier: welcome to British Columbia, and we hope to see you again.

MR. LEA: Each day in an MLA's life, we can thank someone for helping us remain here as MLAs. But the main people we can thank are our constituency secretaries. I think we can all agree on that from all sides of the House.

Today we have a group of NDP constituency secretaries who are in the capital to talk with one another about how they can better serve the public, how people can better deal with government, and to deal with those things that most secretaries deal with in a non-partisan way - helping people get service from government. I'd ask you to join us today in welcoming those NDP constituency secretaries.

HON. MR. WOLFE: With us in the gallery today, or somewhere in the precincts of the Legislature, are four gentlemen whom I would like the House to recognize. They are: Mr. Norm Richards, president of the B.C. Government Employees.' Union; Mr. Jim Kinnaird, president of the B.C. Federation of Labour; Mr. David MacIntyre, secretary treasurer of the B.C. Federation of Labour; and Mr. Ray Mercer, who is on the executive council for the B.C. Federation of Labour. These, and other gentlemen, are in attendance today and I would ask the House to recognize them.

MR. HALL: I'd like to join with the member for Vancouver-Little Mountain; but it's one of those days - everything you touch sometimes seems . . He forgot Shirley Mathieson, the president of the B.C. Ferry and Marine Workers' Union. I'd like to welcome Shirley Mathieson.

HON. MRS. JORDAN: Also in the members' gallery today, and not forgotten by either of the previous members, is Mr. Horst Giese, who is president of Vernon Teachers' Association. He is in Victoria, of course, on business, and I would ask all hon. members to join with me in extending him a very special welcome to Victoria.

MR. REE: In the gallery today we have two people from Vancouver. I'd like this House to welcome to Victoria, and to this House, Mr. K.W. Underhill and Mr. David F. Prentice.

Oral Questions

NORTHEASTERN COAL DEVELOPMENT

MR. LAUK: I have a question for the Premier, Mr. Speaker. On the weekend the government refused to accept the federal government's offer negotiated by the Minister of Industry and Small Business Development (Hon. Mr. Phillips). What additional requests has the government decided to make of the federal government?

HON. MR. BENNETT: The federal government, in dealing with the request for a grant from British Columbia, offered a loan. As we're probably in far better financial condition because of this government, we don't need to borrow money from the federal government; they might be looking to British Columbia. Because of the resource policies of this government, we're able to fully finance the development with proceeds from our natural gas resource.

I would also point out, in response to the member, that we have a Canadian railroad, the CNR. We offered the CNR the opportunity to be more than a timid, main-line carrier, to open up development in all parts of the country, and help underwrite the early stages of development all over the country. That has been the spirit of railroad building in this country for many years; in fact, it was railroads linking the country that brought us together. However, the CNR did not accept the offer, offering something far less Canadian and in line with a type of bottom-line decision that is not consistent with how we view the Canadian railway. In fact, it gives some concern about public ownership, because the southeast coal had an easier time with the private sector, dealing with the CPR in their line in developing their resources over 10 or 15 years ago, than we have had with the publicly owned CNR. It gives us some reason to question whether it serves its purpose well or at all.

MR. LAUK: The Premier's answer, I am sure, is puzzling to most people in the chamber. Could the Premier explain what the Minister of Industry and Small Business Development was doing in Ottawa when the offer originally was as stated by the Premier and agreed to by the Minister of Industry and Small Business Development?

HON. MR. BENNETT: First of all, the member for Vancouver Centre again is not aware of the facts or of the position British Columbia presented some time ago to the government of Canada in trying to include them in this great spirit of Canadianism that a lot of people keep talking about, but their actions do not match their words. British Columbia wanted to demonstrate our willingness to give an opportunity for those national institutions and governments to put their money where their mouth was in a more real way, to show their concern that British Columbia is indeed a part of Canada and more than an area from which revenues are to be drained away or, as a former Premier said, a goblet to be drained. I want to say that the northeast coal will be developed by the

[ Page 2852 ]

provincial government, giving great opportunity to the private sector corporations to sharpen their pencils and negotiate some tough contracts, hopefully with the steel industry in Japan. The remarks of the member for Rossland-Trail (Mr. D'Arcy) and the members from that party over there are, as usual, negative against this project, which will create thousands of jobs just in its inception and many more jobs in its realization. I hope that their remarks and negative attitudes will not destroy the confidence in the political stability of this province of those companies that want to deal with Canadian companies.

MR. LEGGATT: My question, Mr. Speaker, is again to the Premier. I presume at this point the Premier and his officials have completed all their studies in regard to the cost of the northeast coal project. My question is: would the Premier bring the House into his confidence and advise us what the cost per ton of northeast coal is, including rail and water transport, debt services, interest charges on capital and investment and operating costs of the whole northeast project? Would you let us know what the actual cost of that project is so that we can have some idea what kind of price you have to get from the Japanese to make it a feasible deal?

HON. MR. BENNETT: Mr. Speaker, I'm glad the member for Coquitlam-Moody asked the question, because he was quoted on radio on the weekend as saying that he was personally opposed to the coal deal and the development of these jobs in the northeast. I'm very glad that he got on his feet.

Yes, there will be a full public disclosure, but right now we're in very sensitive negotiations, and those negotiations . .

MR. LEA: I'm going to find out after . .

HON. MR. BENNETT: The member for Prince Rupert says he's going to find out after. That's better than their government, who never found out until four years after they were kicked out as government what a bad deal they had made.

Mr. Speaker, this government has done an analysis over a number of years. We've had joint funding with the federal government on on-site studies. They have participated in that regard to lead us to this point in time, and there will be a

MR. LAUK: That was done when we left office.

HON. MR. BENNETT: The first member for Vancouver Centre said it was done when he left office. The only major thing he did when he left office was to take his files with him. It took a year and a half or two years for him to decide to make them public. It is a cruel hoax on the poor old University of B.C., which, in their words, has had these files that are worth nothing and contain nothing of value foisted on them.

MR. COCKE: What are you going to do with your files?

HON. MR. BENNETT: Mr. Speaker, the government of British Columbia is approaching this development as another stepping stone in the economic development of this province, returning to the boldness of the sixties and the great two-river policy, which that party over there opposed. They said we didn't need two rivers and they wouldn't develop the second river until 1984. The lights would have been out all over British Columbia if the people had listened to them at that time. I know they will continue their history of negative thought and opposition to anything that creates jobs or gets things done in this province, but this little government will withstand their terrible, negative opposition.

MR. LEGGATT: Mr. Speaker, there is one thing this party does not want to do and that is pay the Japanese for the privilege of taking a non-renewable resource out of the province of British Columbia. That is what we are not going to stand for; nor will the people of British Columbia stand for that.

My question is this: there is no question that the impact of a northeast coal development . . .

HON. MR. BENNETT: You're against it.

MR. LEGGATT: If you'll listen you'll learn.

. . . is bound to have some adverse effects on southeast coal development.

HON. MR. CURTIS: Where's the question?

MR. LEGGATT: My question is this: has the government completed a study of the impact of the northeast coal project on the economic viability of coal export and production in southeastern British Columbia?

HON. MR. BENNETT: Mr. Speaker, the member for Coquitlam-Moody has now conclusively proven that he spent too many years in Ottawa and not enough time understanding the marketing and the markets available to the province of British Columbia and Canada; because in fact the development of two outlets, two ports and two rail systems, will help the southeast as well as British Columbia and Canada. He must know the concern that has been expressed in dealing with Canada. They were vulnerable to a single transportation system, a single port system and a single area of coal development that could have left the steel companies signing the contracts without secure supply. He must not have been listening, Mr. Speaker, when this government told not only the companies in Japan but around the Pacific Rim also that British Columbia is politically stable and can be a secure supplier of resources, because we are prepared to step out and develop a second transportation system that will guarantee that security.

Mr. Speaker, that is the leadership role that's required. It's the sort of leadership role that cannot be played by those who only know what they're against and not what they're for. I've heard that party during this session clearly enunciate that they're against this and that and against coal and the jobs it will create. Just once I hope the member for Coquitlam-Moody will tell us what he's in favour of.

MR. LEGGATT: There are 4, 000 people demonstrating on the front lawn today, Mr. Speaker. That's one thing I'm in favour of.

I want the Premier, if he would, to clarify one of the previous answers he gave to the member for Vancouver Centre (Mr. Lauk) concerning the proposal by the CN. Was there any subsidy arrangement or grant arrangement from the federal government in that proposal, or was it 100 percent

[ Page 2853 ]

loan? In other words, is a loan proposal all that the Premier turned down in terms of the CN proposal and the federal proposal, or have we forgone federal dollars that should become available to the province of British Columbia?

HON. MR. BENNETT: Mr. Speaker, surely the member spent enough time in Ottawa to know that because of policies his party foisted on a minority Liberal government it's running massive deficits and, in fact, has no money to pay for anything else and has no money to loan. That member knows that. You were part of the destruction of the economy of Canada. You remember those days.

Mr. Speaker, what I say today is that the government of British Columbia has the capability through our natural gas resource revenues to be able to undertake this further step in the economic development of British Columbia, a step that will lead to thousands of jobs for British Columbians and, yes, Canadians as well. Everybody knows that this government has got the money. They know that there was a government once in this province that spent the money and plunged us into debt, but they know that the management by this government has ensured that there is money there, with record revenues from resources unprecedented in the history of this province.

MR. D'ARCY: I think it's unfortunate that there's perhaps not a truly decorous display being put on for the benefit of some of the visitors in the gallery today, some of whom are here in Victoria for the first time.

However, Mr. Speaker, the Premier has raised the spectre of debt and deficit financing which leads me into my question. Perhaps the Premier can tell us how much of the provincial taxpayers' money he is committing this province to, on a year-by-year basis, to service debt, to retire debt and to subsidize the operation of rail lines, mines and other infrastructure in order to export non-renewable energy resources to the Japanese.

DEPUTY SPEAKER: Hon. members, the question and its specifics make it virtually impossible to expect any member to have the specific answer. The question therefore must be ruled out of order.

PENSION AMENDMENTS

MR. HALL: I have a question for the Provincial Secretary. The Premier mentioned money. I have a question about money to him, if I may. The B.C. Government Employees Union have requested a meeting with the government to discuss pension changes. That meeting has been agreed to. Has the government agreed to meet with any other employee organizations involved?

HON. MR. WOLFE: Thank you for the question, Mr. Member. I'm not aware that other groups have requested a meeting, but I can say that the government would be more than happy to meet with other groups involved in the pension amendments. We have previously met with Mr. Fryer and members of the executive of the B.C. Government Employees Union. I think most members in this House, as well as myself, have met with representatives of the B.C. Teachers' Federation on the amendments to the Teachers' Pensions Act. In answer to your question, I would say that we would be happy to respond to further requests to meet from other groups involved in the amendments to the pension act.

MR. NICOLSON: On a point of order, Mr. Speaker, I would commend you to perhaps reread the decision of Mr. Speaker Smith of February 28, 1977, particularly part 1, in which he points out that the purpose of a question is to obtain information or to press for action; it should not, in effect, be a short speech. I believe that that also applies to answers. Also, on the second page he refers to Erskine May's sixteenth edition, page 363: "An answer should be confined to the points contained in the question, with such explanation only as renders the answer intelligible."

MR. LAUK: Mr. Speaker, I ask leave to make a statement on the northeast coal development.

Leave not granted.

Orders of the Day

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

Leave not granted.

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

ESTIMATES: MINISTRY OF EDUCATION

On vote 54: minister's office, $191, 886.

HON. MR. WILLIAMS: Mr. Chairman, I move that the committee rise, report progress and ask leave to sit again.

Motion approved on the following division:

YEAS - 27

NAYS - 22

Mr. Nicolson requested that leave be asked to record the division in the Journals of the House.

The House resumed; Mr. Davidson in the chair.

[ Page 2854 ]

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

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

HON. MR. WILLIAMS: Committee on Bill 21, Mr. Speaker.

RESIDENTIAL TENANCY

AMENDMENT ACT, 1980

The House in committee on Bill 21; Mr. Davidson in the chair.

Section 1 approved.

On section 2.

MR. LEVI: I would like to move an amendment to this section. I can give you copies of the amendment if you would like to look at them. I will read the amendment.

It is to amend section 2 (b) as follows. Subparagraph (9) is deleted and the following substituted therefore: "A dual tenancy agreement is exempt from the provisions of sections 27 (3) (b) and 28 to the extent necessary for a landlord to enforce visiting hours and to maintain and clean rooms, but the rentalsman may order that those sections do apply to the particular premises. "

MR. CHAIRMAN: The amendment appears to be in order, hon. member.

On the amendment.

MR. LEVI: While the section that the government has brought in in respect to hotels is in fact a good one, there is the question of what happens in respect to people who live in hotels who are not covered and have to make application to the rentalsman. The issue of privacy and the other issues which go with the rights of a tenant . . . . In the hotel they are somewhat different. While we generally agree with the definition whether a hotel comes under the act, we have some reservations. Let me just outline them. First, subsection (8) exempts persons who are in personal care homes or in education settings. I want now to deal with just that section.

In this exemption, if we are dealing, for instance, with a long-term care facility . . . . There have been cases where people have been given something like 30 days in which to get out of that kind of facility. There is no guarantee that long-term patients will receive adequate notice if the premises are closed down. As I said, there are clients who were long-term patients, who were told by the people providing the service that the premises would be closed in less than a month. In the operation of this particular facility, surely there has to be much longer lead time for people to be able to make the kind of arrangements that are necessary, particularly in view of the fact that if you are dealing with an extended care situation, where there is an incredible waiting list, or even intermediate care, people could have great difficulty getting into the kind of premises that they need in respect to the service they've been put in.

I'll sit down to get the minister's views on this and then get up again.

[Mr. Strachan in the chair.]

HON. MR. NIELSEN: The amendment, I understand, was to subsection (9). We consider the wording of the subsection put forward to be more than adequate. In fact, we, consider it to be as flexible as possible. It is our considered opinion that the concerns, perhaps, as outlined in the amendment to that section are within the capability of the section as it stands, complemented by further sections to be considered. So we will not be accepting the amendment.

MR. LEVI: Is he saying that he is completely satisfied that tenants who live in hotels do, in fact, have the same rights as other tenants, except perhaps in respect of access in terms of cleaning? What about the privacy aspect? Is he quite satisfied that this is in fact within the act and they will be treated this way, or are we going to get the kind of arguments that have happened? Or is the tenant having to go the rentalsman to get an order to say: "Yes, you are in fact covered"? Perhaps the minister would be specific about this.

HON. MR. NIELSEN: Well, Mr. Chairman, we believe that the manner in which the amendments have been presented do adequately protect the tenants in the hotels - or inns, as they're referred to. We have retained in some of the language the unique aspects of hotels. This legislation was drafted after considerable discussion with people in that industry and we believe we have covered the concerns that were brought to our attention.

We do recognize there are unique aspects of hotels and certain responsibilities for those who operate hotels, and we believe that we have provided the tenants of these units with maximum protection and also maximum respect for their individual rights. We see no problems.

MR. LEVI: Well, okay. We can get the minister to respond to the situation with respect to another type of tenants; people who are actually patients in long-term facilities. What about the amount of time that they'll have with respect to being given notice to vacate? He hasn't answered that one and that, I think, is something of a problem. Perhaps he'd give us his views on that.

HON. MR. NIELSEN: Mr. Chairman, the rentalsman's office does not attempt to suggest that it is in a position to resolve all problems associated with accommodation. It was considered very carefully that where we're dealing with long-term care units or other units which primarily are involved in medical care rather than residential units - residential being a part of it, but not the primary purpose the person would be in those units, which would be for medical purposes - we feel that it is much more clearly the responsibility of the agencies who have the responsibility for long-term care and associated care to work out any resolutions that may be required. We do not believe that the rentalsman's office should be involved in these units, in that the primary purpose is medical attention rather than simple residential occupation. Again, we believe that this will best serve the situation.

MR. LEVI: Well, I think it's all very well for the minister to say that they don't want to be involved, but it's in the act. It's covered in the section that we're dealing with: "premises

[ Page 2855 ]

in an inn occupied by persons in the course of receiving medical care and educational instruction . . . . .. We're dealing with that.

HON. MR. NIELSEN: Mr. Chairman, under subsection (8) it says: "Subsection (3) does not apply" to these premises that we've been discussing. It does not apply.

MR. LEVI: They have to make an application to the rentalsman, is that correct?

HON. MR. NIELSEN: No, Mr. Chairman, they simply do not apply to such premises.

Amendment negatived.

Sections 2 and 3 approved.

On section 4.

MR. LEVI: Mr. Chairman, the present law is that the landlord must post on the premises the legal name and address of the landlord together with a copy of the act. Small landlords are exempt. This amendment does away with that. In fact I think it's characteristic of some of the amendments that we're getting into very small things, and I'd like the minister to give me the reasons why they feel it necessary to end this particular practice that is within the act, particularly because many tenants in large buildings don't always know who the landlord is. I think in terms of the smooth operation of an apartment building, particularly a large one, it's necessary, really, for the tenants to know who the landlord is and where he lives. There is nothing wrong with that. Now why are they taking it out?

HON. MR. NIELSEN: Mr. Chairman, the reason this amendment was put forward, again following consultation, is that the practicality of posting the act, the maintenance of the posting of the act, and the requirements of the owners of such premises to see that such an act remains in that place have proved to be completely impractical. The posting of it simply was serving no purpose other than requiring an owner or landlord to continually check to see if it remained where it was posted, and it has turned out to be very impractical.

MR. LEVI: Well, Mr. Chairman, there are certain requirements that apartment blocks have in terms of posting notices which are required by law, as this one was. For instance, the licence has to be posted and there is information usually in the elevators. What is the difficulty here? Is this something that the landlords specifically have asked for? Do they want to have some kind of anonymity from their tenants, or what? The fact that it's not practical . . . . Other notices, which are instructions required by law, are practical. Why isn't this one?

HON. MR. NIELSEN: Mr. Chairman, we have attempted to undertake a thorough review of this entire act, and we have attempted to eliminate those points of the act which required certain applications by either landlords or tenants, and we have, to the best of our ability, attempted to eliminate those provisions in the act which were either impractical or technically unattainable. This was one that was identified by our investigation and surveys as serving very little practical purpose; we found that the requirement was impossible to enforce and was serving very little practical purpose.

Sections 4 to 12 inclusive approved.

On section 13.

HON. MR. NIELSEN: Mr. Chairman, I move the amendment standing under my name on the order paper. [See Appendix. I

On the amendment.

MR. LEVI: Under the present law, if a landlord wants a tenant's residence for his personal use he must agree to use the residence for 12 months or more. This section was put in to deter abuse. A landlord wanting a tenant out would simply move in for a short period of time and then he would get the tenant out. Under the present law, if a landlord requests a tenant to vacate the premises in order that he, the landlord, may occupy the same for his personal use, and the landlord then occupies the premises for less than 12 months, the landlord must pay the former tenant compensation.

The proposed amendment will now allow the rentalsman to shorten the 12-month period. The result will be that the landlord will now be inclined to use this section to get tenants evicted whom he cannot otherwise legally have evicted. He 'll move in for a short period of time. Can the minister be specific about his intent here? That is the concern about this particular section - about what the landlord in fact has in mind when he wants to get a tenant out.

HON. MR. NIELSEN: Under the amendment, the landlord who moved in for personal occupancy would still be required to occupy those premises for 12 months.

MR. LEVI: I see.

Amendment approved.

Section 13 as amended approved.

Section 14 approved.

On section 15.

MR. MITCHELL: I would like to add an amendment -to be known as clause (e) - by adding a new subsection 5: "Where tenancy is terminated by a landlord under this section for a mobile-home tenancy, notice shall be not less than one year and the landlord shall pay the tenant without delay, after receipt of a written account of the tenant's moving expenses, the actual amount of those expenses."

MR. CHAIRMAN: Could we have a copy of the amendment?

MR. KEMPF: What a ridiculous amendment!

MR. MITCHELL: I just don't want to see them dumped out on the road like they're being dumped now.

MR. CHAIRMAN: Order, please. The Table has not seen the amendment.

[ Page 2856 ]

On the amendment.

MR. MITCHELL: The reason I'm making this amendment is what is happening within the various areas that have been zoned for mobile-home parks. Many people, especially a lot of senior citizens, have purchased mobile homes. They have set them up in the lot at a large expense, not only the price of the mobile home but the landscaping, the shrubs, the additional sun porches and the cabanas. To treat a tenant living in a mobile-home park in the same manner as someone in an apartment is wrong, because they purchased a mobile home as their home. You can't just move in, hook on a trailer or truck and pull it out. You're disrupting the whole lifestyle of a lot of older people who have older trailers. Now that the land is becoming more valuable as commercial or for other reasons it has been rezoned into something else. The tenants within those parks . . . .

In my own riding last year I had one park on Craigflower Road known as the Centennial Trailer Park. People who have purchased a trailer have $14, 000 to $20, 000 invested in it as a home and it's worth $5, 000 when it's pulled out onto the highway. A lot of the older trailers cannot get on a new trailer park. The disruption that happens when you're pulled out with three months' notice is just not fair to the citizens who are living in the trailer parks. I sincerely ask the minister to give his consideration to the protection that is needed for those who are living in trailer parks today. It's necessary and it's something that has been long overdue. It's the lifestyle and the home of many, many people in British Columbia. They must be given more protection than the proposal that you have now for 119 days' notice to be evicted. It is not right. A minimum of one year is needed.

HON. MR. NIELSEN: I appreciate the concern the member has for those people who find themselves in such a position. We have canvassed the problems associated with mobile-home parks and we agree that there are circumstances where great difficulties can occur when a mobile-home park is going out of business, which is the primary reason why they would be using such authority to give the four months' or 119 days' notice. We found that we could not support the concept of requiring one year. The original act was brought in recognizing four months for purposes of demolition or sale and for converting to other use. I believe that four months was considered after a great deal of research. We have retained the same period of time as was the original act, minus the one day for purposes of accommodating the month of February. I appreciate that indeed there is a concern.

We do not believe that accepting the member's amendment would be something which could be supported because of the problems he's put forward. If it were a practical resolution to the problem, our people, I believe, would have considered that more seriously. We believe that four months' notice, or 119 days, will serve an adequate purpose. We do have a shortage of areas suitable for mobile-home development. That seems to be our key problem and I believe that is where the emphasis will be placed. But we'll have to reject the amendment as put forward, Mr. Chairman.

MR. MITCHELL: I would like to review some of the history of one of the mobile-home parks in my own area that is taking place right now. It is one of the reasons why I feel that this amendment is necessary.

The main reason for a mobile-home park being set up is to accommodate people for homes. They're not overnight locations. They're not something that people move into today and they're going to move out tomorrow. They set down roots in an area. I believe that when a person goes to the Capital Regional District or any of the regional areas or municipalities and has an area zoned especially for mobile homes, the owner of that park has some responsibility to maintain some form of tenancy. If we, as society, in the municipality's case or the regional board's case, zone an area especially for mobile homes and allow him to make a living, then society has a right to demand that that person receiving that zoning has the responsibility to those people that he encourages to go out to the various lots and purchase or buy a mobile home. We are, as a society, encouraging them to go out there. I feel that in my particular case, if you go over the history, what is being used in this 120 days in a form of a pressure.

I will go over the history for your benefit, Mr. Chairman. In this particular park, known as Jackson Park, in the Langford area they applied to raise the rent over and above the allowed 7 percent. People living in that particular park, through the legal channel of the rentalsman, opposed the increase of 7 percent. They went to a hearing. They were successful in having that particular increase kept to 7 percent.

The four individuals in that park who led, organized and promoted the appeal were all senior citizens - commonly called "the grey power of the senior citizen movement." They were given their notice to vacate. It was quite evident to everyone in the mobile-home association that this was in retaliation for their efforts to mobilize and organize the people living in that park to hold the rent increase to 7 percent. They appealed that to the rentalsman board, the rentalsman himself upheld that appeal and their eviction notice was quashed.

There was a third attack on those people living in that particular park and all the parks in that area. Prior to that, when everyone moved their trailers to that park they were guaranteed garbage collection, water and cablevision. That had been going on for a number of years; they had been paying their rent and that rent included the three items. Then, without any particular reason, the cablevision was cut off. They were told that instead of having free cablevision they would have to pay $6.50 for it. Again a number of tenants in that park, as in other parks, appealed that unnecessary, unjustified change of an agreement between the tenants and the owner. They made a series of appeals through the rentalsman office. Again they were successful. If they were no longer going to receive cablevision, then they should have a reduction in their rent of $6.50.

Following that series of appeals everyone in that particular park was given 120-day notice of eviction so that park could lie fallow. Here you are asking people who have made .their home in a location . . . . Senior citizens who need to be near stores, doctors and a bus line will be thrown out on the highway on July 31, because there are not sufficient locations in that area for older trailers.

Through you, Mr. Chairman, I ask the minister to give serious consideration to the people who have been evicted and thrown out on the street. Their whole lifestyle has been disrupted so this particular park can lie fallow. One senior citizen there is 84 years of age. He purchased this particular trailer set up on a lot. He paid one month's rent. He went to pay a second month's rent and he was given an eviction

[ Page 2857 ]

notice so the land could lie fallow. Is this what this Legislature says is just and right for those who have built this country, who have worked and developed our resources? I say we must take a stand, we must give some protection.

There is a large difference between a home and an apartment and a mobile home. A mobile home has circumstances that cannot be just lumped together with apartments or a structure that is not moved. I seriously ask the minister to give it consideration, to take it back and study it, and not to just off-handedly throw it out, because it's going to make a big difference to a lot of people throughout the province.

Amendment negatived.

Sections 15 to 43 inclusive approved.

On section 44.

MR. LEVI: I have an amendment to this section, Mr. Chairman. Paragraph (g) is amended - this is subparagraph (1) - by striking out the words "and at the time a tenancy agreement is entered into, subsections (1) and (3) do not."

On the amendment.

MR. LEVI: I'd like to get the minister to be very specific about this section, because it's complex. I've got two amendments. This is the first one. It gets rid of the provision that a landlord may implement a rent increase at the time of a new tenancy agreement whether or not 12 months have elapsed since the previous increase. In other words I'm saying that the requirements that only one increase take place during the course of the year and that a landlord give a tenant three months' notice apply in the case of a new tenancy agreement. I see some problems here. Can the minister be more specific in his explanation on this? Are we in fact going to get more than one increase in 12 months here?

HON. MR. NIELSEN: Yes, under certain circumstances where the premises are rented to a new tenant, they have the capacity to negotiate or develop a new rate for the premises at that time; but then that will be the anniversary date of the increase.

MR. LEVI: Mr. Chairman, this section also deals with taking away rent controls for hotel tenants to a large degree, and hotel tenants will have no guaranteed maximum rent increase. If they think the rent increase is excessive they'll have to apply to the rentalsman for review of it. Can I get the minister to comment on that, because that becomes a problem in respect to the tenants of hotels.

HON. MR. NIELSEN: Mr. Chairman, we're speaking about the first rent that's established. In the hotel units, or similar units, we have no history of the premises as a rental unit, and this would be for that first time the unit is rented out in this manner or recognized as a rental unit. That is when the price for those premises will be developed, and from there on it will be on the anniversary date. But it's for the first time.

MR. LEVI: Then it's simply establishing a benchmark that you work from.

There is one other amendment which is in the same section.

MR. CHAIRMAN: We should deal with this amendment.

MR. LEVI: It's 44 (g), by striking out subparagraph (iv), and substituting a new subparagraph five by repealing paragraph 0).

Amendments negatived,

Section 44 approved.

On section 45.

MR. COCKE: Section 45, 1 think, is of major concern. We could refer to this as the Block Bros. - or blockbusters, whichever you wish - amendment. This Section indicates that where there is more work than, say, 25 percent of a person's share - that is, of the common building and/or that person's own apartment - in terms of renovations, then, by order - that is, by regulation - the landlord can raise the rent 18 percent, which incidentally is ongoing. So what we really have this year is an absolute flurry of landlords increasing their rents by 10 percent-which they are permitted to do by regulation - and then, secondly, by a further 18 percent because they've had to restore a building that was run down or to make just normal renovations for wear and tear and maintenance on a building. I've seen one building where they had to replace a furnace, and everybody in the building had to share in this cost, to the extent of 28 percent. I've seen another building where some carpets are being replaced, some necessarily and some quite unnecessarily, in order to place the people within that structure very close to and sometimes outside of rent control. This is the very kind of situation that would demand that the government would either increase the level of control - that is, increase the rent allowable under control - or certainly put a stop to a lot of the misdeeds and, in my view, robberies going on in this industry,

When you have a zero vacancy rate, as you have in the lower mainland and, to some extent, in the city of Victoria - not quite as bad but certainly it's on its way - then the landlord's natural tendency is to get people out of the control led area as quickly as possible. The fastest way you can do that is to add 28 percent this year to that person's rent. Next year you're going to find them outside of rent control. I've seen an example in a major building in New Westminster, and I've seen another example in a major Block Bros. building elsewhere. It strikes me that it's - just a little more than a coincidence that all these renovations are occurring this year, particularly when you see some renovations which would be thought of as normal wear and tear on a building, and other renovations which are not necessarily of any great use. There is one building where people's carpets are being replaced in an apartment where the old carpets are in good shape. It's older people; they know. They told me that this is the last straw, because next year they will be outside rent control.

The government should be taking a better took at this whole question of these increases. What this 25 percent does is this: if the amount deemed to be the renter's portion of the work being done is over 25 percent, then the landlord can go on charging 18 percent at this point. And maybe next year the government will increase it still further. Their record indicates that precisely what they're trying to do is to get everybody out of the area of rent control.

[ Page 2858 ]

Mr. Chairman, I wonder what the minister has to say about that whole question. Is he receiving complaints, as I am?

[Mr. Davidson in the chair.]

HON. MR. NIELSEN: The amendments brought forward this year are to clarify the practice which is taking place in the industry and which has been permitted by the existing act. There is very minimal change other than to clarify the language used in the previous act; we have attempted to clarify it by changing the wording somewhat. The percentages remain the same. The dates remain the same. Allowable expenditures and so on are more clearly defined.

Yes, we've had some comment from one building in New Westminster about increases for replacement of carpeting. There will, of course, have to be justification of the amount claimed by the owners of that apartment - for passing on this amount of money to be recovered in the prescribed way. To this time, I believe that is the only one we've heard from. There may be others within the province.

The manner in which this is conducted now, Mr. Chair man, is consistent with the amendments placed before us in this bill today. It has been used this way in the past. It is the present authority of the rentalsman, although there have been slight modifications of words in order to clarify the authorities granted him in this section.

MS. BROWN: On the same subsection, I wonder if the minister would say whether there is any retroactive time limit on this. Specifically, I am concerned about one particular apartment - although I know there are others in Burnaby -which has been raised on the floor of this House a number of times before. It's the Sylvan Garden Apartments complex, in which there are 150 suites, 86 of which have filed complaints with the rentalsman. They are complaints going back to 1978. We were told that the suites had to be inspected, but in view of the fact that there was only one inspector this would take some time. Three or four weeks ago the inspection was finally completed.

The repairs will come to more than 25 percent in every case, because the complaints were very serious in most of the suites. They are major changes that are going to have to be done in plumbing, wiring, replacing bathtubs and flooring, ceilings, walls, doors, and all sorts of things, because these particular suites are in very serious need of repairs, going back to 1978. Now that the landlord has decided to do something about it, is the landlord going to be permitted to charge an 18 percent increase, despite the fact that those repairs should have taken place in 1978 or 1979 - at least a year ago? The landlord - an insurance company, ManuLife - postponed and postponed repairing those buildings. The work was not done on them for over a year. Now that this new legislation has been introduced, which permits ManuLife to charge an increase up to 18 percent on the rentals if the repairs are going to be above the 25 percent figure, is that going to be permitted?

Surely that is not fair. Surely those repairs should have been done before. For the company to deliberately wait until this legislation is introduced so that the company can charge an 18 percent increase is an abuse of the legislation. Has the minister taken into account any way of protecting these tenants from the fact that, having been neglected for nearly two years, they are now going to face an 18 percent increase over and above their 10 percent increase - in other words, a 28 percent increase on their rents - as a result of this particular Section 1n the act?

HON. MR. NIELSEN: The owners of that building already had the authority to recover costs. That has not been changed. If they chose not to make repairs to that building at the time the member suggests would have been more appropriate, then it was a matter of argument between the tenants and the owner with respect to maintaining the building, which presumably could have been argued before the rentalsman; and I gather that was brought to their attention.

But, yes, they may attempt, at least, to receive an increase to recover the improvement costs they may incur, just as they could at any time. If this were to develop into an inordinate increase, they would have to justify this to the rentalsman's office. So no inordinate increase would be permitted unless they could justify that to the rentalsman's office - and such an order would go forth.

The situation has not changed with respect to the authority the owner has had to attempt to recover these costs by way of such an increase, in that they had perhaps chosen not to make the repairs at a more suitable time, which may have led to an order by the rentalsman's office for such repairs to be made. But had they made the repairs a couple of years earlier, then it's possible that at that time the increases could have been added on to their rents. If they do choose to make the improvements now, yes, they will be able to apply for recovery of those costs under the section, even before it's amended.

MS. BROWN: That is precisely what I am suggesting is unfair, because what happens is that it is now in the regulations that they may charge up to an 18 percent increase tacked on to their basic 10 percent increase. What happens to that 28 percent increase next year? Do they charge a 10 percent increase on top of that 28 percent increase? This is precisely what I am trying to say. In fact, they have given themselves a 28 percent rental increase right off the bat as a result of this particular section of the legislation. Before this 25 percent figure was introduced into the act, they would have had to meet with the rentalsman and negotiate some kind of reasonable figure in terms of paying off the cost of these repairs. Instead, now it is enshrined in the legislation. If the repairs are more than 25 percent - in most instances they are going to be, because apartments have been very, very badly neglected by the owners - now ManuLife can increase the rent of those 86 suites up to a maximum of 28 percent this year. Next year when they are computing the increase on those tenants' rent, they compute a 10 percent increase on the 28 percent increase.

1 hope that I am wrong and I would appreciate it if the minister would clarify for me that I am wrong and that ManuLife cannot give themselves a 28 percent increase this year and an additional 10 percent increase next year, rather than just a 10 percent increase each year. That is not fair.

HON. MR. NIELSEN: Just to clarify, the 25 percent or prescribed amount as included in the amendment is not changed from the present legislation. The owners of such properties presently, without any amendments, are permitted to do this. The percentage increase is subject to regulation and has been changed to 18 percent. Yes, that would develop

[ Page 2859 ]

a base rent which could be subject to the prescribed amount of permitted increase next year, whether it be 10 percent or some other prescribed amount. The difference that the member has pointed out - the difference this year should they make necessary changes and should they qualify to recover that money - would be from 12 percent to 18. That would be the difference. Otherwise the situation would not have changed. The cumulative aspect has always been in effect.

The figures have changed from 12 to 18; they could add that on and that would be effective in a cumulative way.

MS. BROWN: What I am suggesting is that it isn't fair that ManuLife should have postponed repairing those 86 suites for a year or more and realized a profit as a result of that kind of neglect. These tenants have been asking for those suites to be repaired since 1978. The rentalsman's office finally completed its inspection, because it only had one inspector. Because ManuLife did not do the job when it should have been done they are going to realize a 6 percent increase which is compounded - is that the correct word that I'm looking for? - with each passing year. They are being rewarded and that is not fair. The minister should have somehow built into the act some protection for tenants who have been abused by their landlords in this way. In other words, there should have been an amendment that says, "This increase from 12 to 18 percent will only apply in those instances where the necessary repair is brought to the attention of the landlord as of the day the act is proclaimed, " or something to that effect. But to permit the landlord to neglect the building for two years and then to reward them with an increase is not fair to the tenants. That is what I am trying to bring to the attention of the minister. I ask whether there is any way that he can amend it or build some kind of protection for tenants into the regulations.

MR. LEVI: Under the present act, if the tenant wanted to appeal the rent increase the rent would stay as it was until the appeal was heard and there was an order given one way or another. Now the rent increase has to be paid, and then you go to the rentalsman for an order, and if he says it's okay, that's fine; if it's not, then I presume the process is to credit the tenant. Why is there the change? Why have they gone from staying the increase in rent until the appeal is heard? Now they've said, regardless of what the landlord wants to do, pay the rent increase and then go to the rentalsman and appeal, and he'll make an order if it's wrong. In the meanwhile they're paying what could be an exorbitant increase. Now why is that change being made?

HON. MR. NIELSEN: Mr. Chairman, the main reason is that the experience of the rentalsman's office has been that such disputes often lead to further disputes. It's been found by experience that it is more practical - and certainly easier from the rentalsman's point of view - to recover those costs from the owner than in some instances to recover such costs from a tenant in the event that an argument were put forth and additional moneys would be required. In many instances it was very difficult to recover those moneys from a tenant; whereas if it was the owner who was responsible for responding by way of refund, it was very simple from the rentalsman's point of view, in that the owner is probably in a position of more permanency than some tenants and was always in the position to have those funds available to that tenant, but it's not always so in the other way.

[Mr. Strachan in the chair.]

MR. LEVI: While I appreciate what the minister has said, surely, if this section passes, you could get landlords charging a very high increase, and you could, for instance, have a tenant who is on a fixed income and finds that that increase is very, very difficult. Now surely there is available to the rentalsman the business of the deposit which is available to collect the money, if necessary. But I think you've gone from one side of saying it was difficult to collect from some tenants to really now showing some favour to the landlord, because he's more permanent - he's there; the tenant tends to move on.

But we're also looking at the serious problem of what that kind of increase could do to people, particularly if it's an exorbitant increase which they're going to appeal, but they have to pay anyway. Now that, to me, is neither fair nor very logical. Surely there are other ways of getting at what the tenant owes. After all, there is a deposit that's been given; surely some of that could come out of that. Surely this destroys some of the equity that the act has been attempting to provide in terms of the landlord and the tenant. Here they've gone way over to the other side; in fact the whole section characterizes that in terms of leaning over towards the landlord as opposed to the tenant.

Now my specific query , Mr. Chairman, is what happens in the case of somebody who gets what he considers to be an exorbitant increase which he really can't handle. He's going to have to pay it and then wait for the appeal process. Now surely that's not a very fair way of doing things.

HON. MR. NIELSEN: I appreciate the remarks. If the tenant appeals the increase to the rentalsman's office, then the increase does not come into effect until that's been resolved; in effect it is stayed.

MR. LEVI: Well, that's the same as it is now.

HON. MR. NIELSEN: Yes.

Mr. Chairman, on the question of the deposit, of course the deposit can only be dispensed when the vacancy occurs, when the tenancy agreement is over, and that would not necessarily be the circumstance. But I'm advised by the rentalsman's office that if the dispute takes place, then there is no cause for the increase to be paid until it's resolved.

MR. LEVI: Well, then perhaps the minister can help me. What's the purpose of the amendment if it stays the same? Because I don't read it as being the same; I read it as saying that the rent does not stay where it's at, but rather it has to be paid; and then, subject to what happens to the appeal, the arrangement is straightened out. Now the minister has said quite categorically that there would in fact be no increase going into effect if an appeal was made. Well, that's the way the act was before he amended it. Maybe he wants to consult with his friend there, because that's as I see it.

HON. MR. NIELSEN: Mr. Chairman, I appreciate the questions and I also appreciate that we're dealing with a very technical aspect of the bill. I wonder if the member could refer to the specific section and the words so that we're on the same wavelength.

[ Page 2860 ]

MR. LEVI: Well, now he's got me threatened because he's got the experts alongside of him.

If we go to section 45 (b): "By repealing section 4 and substituting the following . . . . .. Section 65 (4) now reads: "Where notice is given by a tenant pursuant to subsection (3), the landlord's notice of rent increase for eligible expenditure is stayed and the landlord shall, not more than one month after the date he receives a notice from a tenant under subsection (3) . . . . ..

You're repealing subsection (4). You've taken that section out. That's the section: "Where notice is given by a tenant pursuant to subsection (3), the landlord's notice of rent increase for eligible expenditure is stayed and the landlord shall, not more than one month after the date he receives a notice of the tenant under subsection (3) . . . . .. So that's removed. What have you replaced it with? "By repealing subsection (4) and substituting the following: Where a tenant gives notice to a landlord under subsection (3) . . . . .. Subsection (3) says: "Where a tenant receives a notice of rent increase under this section, he may, within one month after he receives the notice of the increase or a longer period the commission allows, give the landlord and the commission a notice requiring the landlord to apply to the commission for approval of the increase."

Section 45 goes on to say: the notice of rent increase given to the tenant is void to the extent it relates to an increase purported to be made under this section unless the landlord, not more than one month after the date he receives the notice from the tenant under subsection (3), or within a longer period allowed by the rentalsman, applies to the rentalsman for approval of the increase."

Perhaps the minister can tell me where it is void. We've got the Attorney-General (Hon. Mr. Williams) sitting there having a real good giggle because here are the lay people wrestling with this monstrous thing that we're dealing with.

HON. MR. NIELSEN: Mr. Chairman, section 3 remains in the act. It is 4 which is being changed and again it's basically for clarification. It says in the section " . . . the notice of rent increase given to the tenant is void to the extent it relates to an increase purported to be made under this section unless the landlord, not more than one month after the date he receives the notice from the tenant under subsection (3), or within a longer period allowed by the rentalsman, applies to the rentalsman for approval of the increase. " So it is void until it's resolved.

MR. LEVI: Then it's just a technical change. I don't want to get into it. I see the lawyer at the back nodding his head. That's something these lawyers do all the time, I guess. It's purely a technical change; the principle remains. If there's a rent increase it stays until the appeal is heard. Okay, we've got that clarified.

MS. BROWN: I really wish the minister would indicate whether he is prepared to take into account the plight of tenants who, because the landlord has been negligent in terms of repairs to their suites, are going to find themselves with an additional increase on their rent; the landlords are going to be rewarded. An increase from 12 percent to 18 percent is a 50 percent increase. In this particular case the landlord is ManuLife, but I'm sure that ManuLife is not the only one and I'm sure that Sylvan Garden is not the only complex that this would apply to. If the repairs had been done when they should have been done, in 1978, 1979 or even earlier in 1980, the cost of those repairs as passed on to the tenant would have been up to a maximum of 12 percent. Now it's going to 18 percent. The tenants are going to be further penalized as a result of the landlord's negligence to get the job done when it should have been done. Can the minister protect the tenants? Is there any way that either the regulations, the act, a statement or whatever can be made to indicate that this 50 percent increase is not to apply in any instance where the repairs were brought to the attention of the landlord prior to the proclamation of this bill?

HON. MR. NIELSEN: The member will realize that if the repairs had been made at a more appropriate time and that 12 percent increase were permitted at that time, that would have a cumulative effect as well. If the tenants oppose such an application for an increase, the rentalsman's office will hear their case. It is within the rentalsman's authority to permit or not to permit such increases. This sets the limits of the increase which is permitted, but if it is a disputed increase it'll certainly be considered by the rentalsman's office. The rentalsman will take into consideration the factors that you've related to us today.

MS. BROWN: Is there any way that the minister can clearly state publicly or by memo to the rentalsman that in dealing with increases which were brought to the attention of a landlord prior to the introduction of this bill - I'm sorry, I shouldn't have said "proclamation" earlier- the negotiated costs or charges passed onto the tenant should not exceed the 12 percent figure? Is that possible?

HON. MR. NIELSEN: No, I don't believe that is possible in that simplistic a manner.

MS. BROWN: Well, make it more complicated, if you want.

HON. MR. NIELSEN: I think the rentalsman could, indeed, give consideration to that concept. The rentalsman's office could say to them: "We will not permit this increase. "

MS. BROWN: Okay, thank you. He'll have your blessing when he does that.

AN HON. MEMBER: He has the authority.

MS. BROWN: Okay.

MR. COCKE: Mr. Chairman, the landlord - and particularly these corporate landlords - gets a marvellous write-off for depreciation of a building, which to some extent allows for some deterioration. In our society and under our present economic situation we have an inflation that is carrying right through to the value of buildings. For instance, a building that might have deteriorated dramatically over the last ten years is still worth a hell of a lot more than it was ten years ago, regardless. I realize what we're talking about here, in terms of setting the maximum limits. This 18 percent, which was dramatically brought from behind the closed cabinet doors two or three months ago - this 50 percent increase - is just going to allow landlords to get away with murder.

Mr. Chairman, they're going to force people over the

[ Page 2861 ]

$500 limit very quickly. Somebody that's now at $300 or $350, with a couple of 28 percent increases - this year's 28 percent is next year's 38 percent, etc.

Incidentally, if I wanted to use the minister's argument in his answer to the member for Burnaby-Edmonds (Ms. Brown), saying that the 12 percent last year would also be accumulative, I'll take that 12 percent any old day over an 18 percent accumulative now. What kind of talk is that? I think it's abandoning the whole concept of trying to keep the lid on things by having increased it to 18 percent. That's where we're in tough shape.

My question to the minister is this: will the rentalsman be empowered to view normal wear and tear as depreciation not chargeable to the tenant? For instance, when a building has to be repaired through normal wear and tear, which is naturally what one would expect . . . . After all, when one is getting a large income tax relief in anticipation of those sort of things, how come we're rewarding them out of the tenant's pocket? Is the rentalsman going to have a really hard outlook on this situation and hold down these landlords - and, as I say, particularly these corporate landlords?

HON. MR. NIELSEN: The rentalsman does have that authority to use his judgment on such applications, provided there is a request or a dispute by the tenant or tenants, who may be associated with that. Renovations and improvements are not necessarily the same as maintenance of a building. Maintenance can be very, very different. The rentalsman does have that authority now under his general powers to take into consideration such factors as have been discussed here today. There is by no means an automatic increase simply because certain repairs and other maintenance orders are required to maintain a certain standard that is required of the building. They are not necessarily automatic at all, and the rentalsman does have that authority to take those factors into consideration.

MR. COCKE: I'd like to illustrate with one example. A company builds a building or purchases it. They bought the heating system from the lowest bidder, which is usual, I'm sure. Now 15 years later the furnace is burned out because it was inferior to begin with. They have to replace the furnace. Is this a legitimate charge on the tenants?

Interjection.

MR. COCKE: The member for Omineca (Mr. Kempf), with his usual wit and wisdom, is getting into the debate, never ever standing in his place or putting forward an argument. Why don't you keep your mouth shut or stand up? One or the other.

MR. CHAIRMAN: All members will come to order. The member for New Westminster has the floor on section 45.

MR. COCKE: That's the intellectual wing of the Social Credit Party.

Interjection.

MR. COCKE: Now we get Fred Flintstone joining in the fray.

Is the minister involved with the rentalsman in setting some sort of standards in terms of what represents normal wear and tear, deterioration and whether or not tenants are being placed in a very, very high rent category forever and a day? Because once you get the 28 percent increase then everything is over and above that from now on. Will there be some consideration in terms of the kind of example that I put forward?

HON. MR. NIELSEN: Indeed, that is very much considered by the rentalsman's office now. They certainly take that into consideration. They fully appreciate the various categories of maintenance, wear and tear, and so on. Yes indeed, they take that into consideration and they will continue to do so.

MR. HYNDMAN: Just very briefly, to add to the points made by the member for New Westminster, and in an effort to just add a further positive contribution to the debate, I think the Income Tax Act of Canada as well provides, in two respects, safeguards to satisfy the concern mentioned by the member for New Westminster.

First of all, on the broad topic of a new capital improvement for a building, such as a furnace, any attempt by an irresponsible landlord to write all or most of that full cost off in one year and charge it against tenants . . . . Of course, the Income Tax Act of Canada provides that you can only write off in one year, as an expense, a portion of a total capital cost and you cannot, therefore, write off all the capital cost.

Additionally, in terms of depreciation and the concern mentioned by the member for New Westminster that some irresponsible landlords would attempt to use depreciation as a means of justifying unreasonable rent increases, again there are limits in the Income Tax Act of Canada. In fact, the depreciation allowance has been severely restricted under the Income Tax Act in its application, and owners of apartment buildings which are medium or old in terms of age no longer may use depreciation to show a loss on their books. Hence, because of the income tax ruling, with the exception only of the so-called MURB projects, a landlord is precluded under the Income Tax Act from using excessive depreciation on his or her financial statements as a means to justify an increase.

I hope those comments might be helpful to supplement the comments of the minister and to reaffirm that the Income Tax Act, as well as this legislation, contains provisions to discipline those kinds of irresponsible landlords with whom we are all concerned.

MR. COCKE: It is a shame that the member wouldn't come in and listen to the whole debate. Obviously he hasn't; otherwise he wouldn't come up with such an asinine statement. Nobody is referring to the future. What we are referring to is the advantages that the landlord has had over the years. That is what I am talking about. I'm not talking about some future declaration that he has to make. I understand how it works. Anyway, if the member wants to be an apologist, I think the minister was doing quite well until he got help from the second member for Vancouver South, who tried to throw some sand into the gears. Maybe he is after the minister's job, but frankly, after that kind of a statement, I think I'll support the present minister, as much as I have very little confidence.

MR. HYNDMAN: I -egret that the member for New Westminster finds it impossible to accept the proposition that

[ Page 2862 ]

occasionally in this chamber there may be a time when a member, apart from partisan politics, might like to add a thought or two to help the general debate. I regret very much that the member for New Westminster would ascribe my remarks and receive them in that context. I regret that very greatly.

Sections 45 to 47 inclusive approved.

On section 48.

MR. LEVI: I have an amendment to 48 (a) (1). Clause (b) is amended by striking out the words "where the existing rent is not more than the prescribed amount." This is the opposition's attempt to bring to the minister's attention that while, in the body of the bill, he has made an attempt to bring more tenants into the ambit of the Residential Tenancy Act . . . .

He has done that in terms of the hotels. He has made some changes. What we are dealing with here are those 35, 000 units in the province that were built and are being lived in since January 1, 1974. The attempt here is to bring them into the area of control. I am told by the rentalsman's staff that there is a range of payments which people are making in these non-controlled apartments or uncontrolled tenancies of anywhere from $450 to $600 per month. The minister has brought in a change to the regulations which now goes to an increase from 7 percent to 10 percent. Those people living in those units that are not controlled are going to find themselves with increases of $60 or more - if they want to follow the 10 percent it will be $60. Some of the experiences that people are having are increases anywhere from $50 to $250. That's the range.

I would ask the minister to perhaps let us know . . . .

Earlier we talked about the establishment of a benchmark, in terms of what we were doing in setting a level in the hotels. When is it going to happen that these units, which have been built now, are on the market and have been rented for pretty close to six years . . . ? Surely these operations have found their market, their price - albeit in some cases, if we go by the mail we get from people, a rather exorbitant price. We're asking here that the minister bring these 35, 000 units - and that's the number of units that there are - under some form of control. Otherwise, these people could very well find themselves paying enormous amounts of rent - something in the region of, I would suggest, in the next two years . . . anywhere up to $800 and $900 a month. That is not unrealistic in terms of what they're paying now and what kind of freedom the landlords may feel they have in going from 7 to 10 percent.

Perhaps the minister would share some thoughts on this. We're rather anxious. We have a sufficient amount of mail now to indicate that people would like to get some kind of control. It seems that in the approach the minister's taken to the act - to broaden the number of people that are covered - there's that one group that remains uncovered and very much at the mercy of people who are prepared to do the gouging. I spoke in second reading about some companies who did this, and who were charged with some 130 offences. Unfortunately, I do not consider that the punishment they got was adequate - a $2, 000 fine was not adequate. I think there was general dissatisfaction by people who are trying to do some kind enforcement in rent control. Nevertheless, there are people out there ready to make a big buck in terms of rents, particularly those rents that have no control at all. The minister has failed to address himself to this. That's why we've introduced this amendment, and I would be interested in the minister's comments.

HON. MR. NIELSEN: Mr. Chairman, I hope we're speaking about the same aspect of this section. We will have the ability, under these amendments, to include that very large number of people - between 35, 000 and 40, 000 tenants - who at this time are under no control of any kind. This will permit us to have the authority, by way of prescribing paragraphs of the section, to bring in any group or class of people. They will probably be included when the regulations are drafted.

On the amendment, to strike out the words, "where the existing rent is not more than the prescribed amount . . . . .. It's our intention, in leaving the words in, to permit us to have an upper limit - a prescribed amount - if we so choose. I'm not promising, but we could choose that it could be up to $1, 000 a month. Such units which rent for whatever figure it may be - $1, 000 or $900 a month - may not come under this, as there has been a limit before, and that is a prescribed amount that is subject to change at any time. But the people who are in the mid-range - if we want to use that term -who may be subject to an increase of an unstated amount at this time, would very likely not fall within that prescribed amount for some period of time. Government could, of course, respond to that very quickly by changing the prescribed amount by order-in-council. The 35, 000 to 40, 000 people will have the opportunity of coming under the rentalsman's jurisdiction; at the present time they have no opportunity at all to appeal. The amendments have the capacity to cover those people, and any such other class or group of people as may be identified - which could include amounts paid.

MR. LEVI: Well, I was a little concerned, when I was making my case before, that if I said $700, $800 or $900 rent two years down the road, maybe I would be exaggerating. But the minister came in and said: "We're looking at possibly putting a ceiling on $1, 000. " That's a pretty horrifying prospect for some people who are living in those . . . . I'm not holding the minister to the $1, 000, because he quickly wriggled out of that after he said it. But there is a very serious problem there.

What we have with the amendment at the moment is the possibility of review. All right, they can have a review. I think that the review idea is okay, except that the minister has to remember that he's put an incredible onus on his rentalsman's office and staff to do a great deal of work, and they don't have anywhere near the kind of staff that they will need to do this. All of a sudden you're going to include some percentage of those 35, 000 units. People are going to come in and ask to have rent review. You're going to have an enormous amount of work there. It would seem to me that the commonsense approach would be to set a limit.

I know all of the arguments that we heard from that side when we first brought in what was then the Landlord and Tenant Act. Then we heard previous ministers say that we have to get away from the idea of rent control because it inhibits people from investing. We now know that that's not the case. Those are not the things that inhibit people from investing in the construction of houses or apartments. It is basically dollars and cents: interest rates, tax breaks in terms of capital cost allowance or whatever. It seems to me that the

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minister is saying that somehow things are going to get a little bit worse for these people before he's likely to cap it off.

All right, I don't dispute the idea of doing it by regulation; I don't think we should have to come in here every time to alter the levels. But there's a very serious problem with this group. While I appreciate that the minister is saying that there is an option for review, I don't know whether that kind of review is going to be available to all the people for them to take advantage of this change in the legislation. From the information we've gathered from the rentalsman's office over the last four or five months, we know that the number of calls they've been getting has doubled. Lots of people can't get through. Yet the minister is creating a greater burden for these people, rather than taking what is perhaps the most sensible view of putting some kind of limit on it. He has a limit of $500 in other situations. There's no reason why there should not be that kind of limit. Surely these people have now been in the marketplace sufficiently to understand and to appreciate what kind of return they are entitled to, and they should not be entitled to gouge, as some of them are doing. But, I think, to leave it to the Rent Review Commission is not in the interests of this group of 35, 000 tenants - that is, families or individuals.

HON. MR. NIELSEN: This will be the first opportunity for many of these tenants to have the right to appeal to their rentalsman for any review. A lot of the work which will take place will actually substitute for other work which is happening now, whereby a landlord or an owner may have certain units which are under rent control and subject to a percentage increase, subject again to to the opportunity of seeking a greater increase if it can be justified, which of course requires a review by the rentalsman's office. Much of this will be substitution. The same basic analysis will take place as can take place at the present time, in many instances.

I recognize that, yes, there is going to be a surge of work; the rentalsman's office recognizes that as well. We have attempted to prepare for that. We are training more people to deal with this particular area, and probably some additional hours will be permitted for such reviews.

We recognize indeed that there is going to be a surge in work for the rentalsman's office. They are preparing for that. They anticipate it. We believe that we will be able to survive the onslaught. The rentalsman's office will simply have to do the best it possibly can under the circumstances. We feel confident that they will be able to handle the workload. A great amount of the workload that has been placed upon the rentalsman's office in the past few months has to a large degree been over this issue; a great deal of it has been in responding to people who are inquiring of the rentalsman's office as to how they may have such increases reviewed, the answer being that at the present time this is not possible; then further explanations of why it isn't, and so on.

So a lot of this will be substituted action that is already taking place. I think we will be able to come up with a resolution to their problems, rather than simply explaining the adequacies or inadequacies of the present act.

MR. LEVI: If the surge - as the minister characterizes it - takes place and it really becomes quite overwhelming, as I understand it he does have the option to bring in a regulation to place a ceiling on this particular category which we are talking about in this amendment. He can do this by regulation; he doesn't have to come in and amend the act. Is that possible to do? Fine.

Amendment negatived.

Section 48 approved.

On section 49.

HON. MR. NIELSEN: Mr. Chairman, I'd like to move the amendment on the order paper under section 49, deleting paragraph (a) and substituting paragraph (c) in correction.

Amendment approved.

MR. LEVI: Are we dealing here with the return of the deposit? We're not.

Section 49 as amended approved.

Section 50 approved.

On section 51.

MS. BROWN: I would like to introduce two amendments to section 51: The following Section 1s added following section 75 (l):

" 1) In this section 'commercial renter agency' includes any person who by contract or agreement and for a fee aids or provides information to aid a tenant in search of residential premises available for rent or lease.

" 2) No commercial rental agency shall take, accept or receive any deposit, fee or charge for any services rendered to a person seeking residential premises unless and until such person has successfully obtained residential premises as a direct result of such services provided; however, a commercial rental agency may charge and collect a registration fee not exceeding $5.

" 3) A commercial agency may charge a person registered with such an agency a further fee after the person so registered has occupied residential premises, provided:

"a) the person registered obtained the residential premises as a direct result of services provided by the commercial rental agency, and

"b) the total of the registration fee and such further fee as may be charged under this subsection shall not exceed 10 percent of the monthly rental rate for the residential premises or 10 percent of the equivalent of the monthly rental rate if the tenancy is other than a monthly tenancy. "

Also section 77 is amended as to subsection (1) by striking out -75" and substituting therefore "75 or 75 (l).

Interjection.

MS. BROWN: No, I said section 55 (l) has a number of subsections in it, and the one I . . . . Oh, yes, I'm sorry. It should have said "72, " not "75". Would you mind correcting that for me, Mr. Chairman? May I proceed?

MR. CHAIRMAN: Yes.

[ Page 2864 ]

MS. BROWN: I have another copy if the minister would like one.

This amendment really is based on a comment made in the Vancouver Sun on May 22, 1980, by the rentalsman himself, where he put forward the idea that rental agencies should have to refund payments if they were unsuccessful in finding accommodation, and that somehow they should show some accountability in terms of their operations.

MR. CHAIRMAN: Hon. member, just for the clarification of the Chair, we have passed section 50, and it was on section ....

MS. BROWN: Yes, I'm on section 51, and there's been an error. Instead of "75, " that should read "72 (l)."

MR. CHAIRMAN: You have section 55 listed in your proposed amendment on the table.

MS. BROWN: I'm sorry, Mr. Chairman, it is section 51. Isn't this the section that deals with residential rental agencies?

MR. CHAIRMAN: There's no section that deals with residential ....

MS. BROWN: No, no, "rental agencies."

HON. MR. NIELSEN: We don't deal with rental agencies.

MR. CHAIRMAN: That would cause me also to consider that it is irrelevant and that it went beyond the scope of the bill.

MS. BROWN: Fine. I am under the wrong section. It is section 55. 1 will deal with it under section 55.

Sections 51 to 54 inclusive approved.

On section 55.

MS. BROWN: Mr. Chairman, is it possible for me now to move the amendment to section 55 (l) and say the following Section 1s added following section 75 and then proceed from there?

MR. CHAIRMAN: Hon. member, it is the opinion of the Chair that this is beyond the scope of the bill, and the amendment would not be in order.

Sections 55 and 56 approved.

On the title.

MS. BROWN: Mr. Chairman, the title of this bill is the Residential Tenancy Act, and I would like to raise a couple of comments about this particular piece of legislation.

People in receipt of welfare, and families with children, are also tenants who are residents, and they are not covered by this legislation.

Also, Mr. Chairman, this particular act dealing with tenants who are residents of accommodation . . . . They are not protected from the kind of gouging which is being carried on in some of the municipalities by rental agencies. I realize that it's not possible to move an amendment - or probably it is not a good idea to move an amendment to the title - but the title is false advertising, because it does not deal with the fact that tenants can be exploited by rental agencies that can make promises which they are not capable of fulfilling, as the rentalsman himself pointed out in an interview with Sun, where he said that they have to be regulated. And for that reason I would like to raise this issue under the title. It's false advertising. This title does not do the job that it is supposed to do, because it has no protection in it for families with children, who are discriminated against by landlords who refuse to rent accommodation to them - and they're capable of being tenants too. It has no protection for welfare recipients who are being discriminated against by landlords who've decided that they will not rent their accommodation to people who are in receipt of welfare, and it has no protection in it for tenants who are being exploited by rental agencies.

I realize that some municipalities, like Vancouver in its charter, have introduced changes to control and regulate the actions of these rental agencies that exploit tenants who should be protected by this piece of legislation; but there are other municipalities in the province that have not done so. Mr. Chairman, it is something that should have been dealt with in this particular piece of legislation. It has to be covered by provincial legislation, and it hasn't been covered.

I was hoping, as I said, to introduce an amendment to this particular bill which would have made it possible, if the minister had accepted it, to place some kind of control on these rental agencies. They could charge a registration fee of $5 and would not be permitted any additional fee, unless they did, in fact, deliver what they promised - that, in fact, people seeking accommodation did find it; then they could charge up to another 10 percent in terms of the monthly rent. But the bill fails to do that, and therefore I'm saying that the title of this bill is an erroneous title, it is a false title, and I'm speaking against the title of the bill.

Title approved.

HON. MR. NIELSEN: Mr. Chairman, I move the committee rise and report the bill complete with amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

Bill 21, Residential Tenancy Amendment Act, 1980, reported complete with amendment to be considered at the next sitting of the House after today.

HON. MR. WILLIAMS: Second reading of Bill 14, Mr. Speaker.

CONSUMER PROTECTION AMENDMENT ACT, 1980

HON. MR. NIELSEN: Mr. Speaker, my apologies for my hesitation; I have not been able to find my notes on this bill, but I believe I can speak to it until those notes arrive in just a moment.

A consumer protection amendment act is being put forward this year to resolve a number of problems which have been identified through our consumer side of the ministry. As

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members will note, a great deal of it is technical - accounting and some rules of law. We believe that this act will clarify many advantages to the consumer which at the present time appear to be unclear. We believe that the amendments resolve many minor drafting problems which were in the act before. Because of the amount of time spent speaking to the people in industry and the consumers who respond to that, they've been able to resolve them in very clear terms.

As an example, I offer you the situation with the tax discounter, where it was clear that they were required to pay 85 percent, but it wasn't clear as to when they were required to pay the 85 percent. The act also relates to specifics involving variable credit, unsolicited credit cards and unsolicited goods. We set in legislative form, by way of amendment, specifics which previously were unclear; they also relate to other acts in our jurisdiction, as well as some federal acts, and the language is parallel to theirs.

One particular area which is of concern to the ministry on the consumer side is what is known as future services contracts. We have given this a great deal of consideration and believe that the amendments will provide us with the authorities needed to ensure that consumers are not placed in a highly vulnerable position for purposes of financial expenditures in so-called "future contracts" with respect generally to health spas or dance studios or other personal service contracts. We have petitioned the industry for a considerable period of time. We have received their thoughts and opinions and I think we served adequate notice that we intended to move in this area and the results are before us, under this act, now.

I think I will move second reading on this bill and hear from other members of the House as to what clarification they may require and any comments they may have.

MR. LEVI: The intent of the act has basically been, again characterizing what the minister is doing in some acts relating to his department, to clean up some of the loopholes, particularly the one related to the tax rebaters. Two or three years ago, when the legislation first came in, they took a look at how we might curb or regulate this particular kind of activity and this is now an attempt in the bill that will enable people who are receiving tax discounts as a concern to ensure that their clients are not forced to wait for the total cash value of their rebate. That is something people go to the trouble of doing for cash rebates. Going to these people, they should have an option to get their money as quickly as possible.

So we go through the various amendments. But what I think I'd like to address myself to, because we are dealing with amendments to the Consumer Protection Act, is one aspect of consumer protection which has been before us for a number of years. I have in mind to discuss at this time, within the scope of the amendments to the Consumer Protection Act, a very serious problem which I feel the minister has failed to address himself to, in respect of the electronic scanner problem, which a number of people feel does exist and will exist in the future. I say this for a number of reasons.

In the 15 years that I've retained an interest in consumer protection, we started out, many, many years ago, by saying to people that the only way you can get adequate kinds of consumer protection is not necessarily the kind of consumer protection that you get by law. As somebody once said, in many cases you can't regulate against stupidity. I accept that. We pursued, many years ago, in terms of the consumer protection field, the idea of educating people to understand what they were doing when they were engaging in contracts or making purchases. An underlying factor that was always introduced was the issue of comparison. Don't jump into it; compare-, take a look.

The electronic scanner problem - which I characterize as a problem - really goes very much against the 15 years of effort that have been made in North America and in other countries - but particularly in North America - coming out of the United States, up into Canada through the Consumers Association of Canada, on the whole idea of adequate kinds of packaging, adequate description on the packaging and clearly marked prices. We are now involved in a highly technical electronic scanner kind of computing, accounting and cash register operation. All those factors are involved in these electronic scanners.

A number of people have been in touch with the minister with respect to the way this process was introduced. I think that here the minister has fallen down in doing his job in an adequate way. He's had an opportunity to observe what goes on in other jurisdictions, particularly in at least three other provinces: Manitoba, Quebec and Ontario. Now in Ontario, which I think is an excellent example of how the elected officials and the officials of the Department of Consumer and Corporate Affairs approach the business of the introduction of electronic scanners, they didn't seek, in the first instance, to bring in some legislation. That is what they did in Quebec.

The amendment to the Consumer Protection Act requires that all goods that are sold must have prices on them. That is a basic requirement. Over the past 15 years that is what we've been attempting to do in terms of educating the consumer. The prices are clearly marked-, the weight and packaging is clear so people know what they're getting. In Ontario they decided to introduce electronic scanners. At the time when they were introducing them there, they were discussing them here. The arrangement that was made between Consumer and Corporate Affairs, the equivalent department, the supermarkets and the Retail Council of Ontario was that we will introduce the scanners, but we will leave the prices on the goods. I thought that was a very good way of going about creating some test situations for a new innovation. We're not in a position to tell the supermarket how to run their business. That's their affair. Where it impinges on the right of the consumer, then it becomes the affair of legislators and the people that are the administrators in the department. That was the approach in Ontario.

It's really characterized - once I've described the approach out here - as the middle-road approach and the approach of reasonableness. Here there are about 18 stores that are operating with electronic scanners. There are all sorts of advantages, first of all, to the supermarkets, for electronic scanners. That's accepted. They have to make an investment of something like S300, 000 to install these machines: nevertheless, there are great advantages to these machines. First of all it gives them a very adequate kind of inventory and accounting control. What it doesn't do is meet the consumer even halfway in terms of the rights of the consumer to know exactly what they're buying all the time. It's no good saying to the consumer, after they've purchased through an store which has an electric scanner, that at the end of it all you'll have a long list of all the goods and it will all be priced. All you have to do is have a good memory to match the prices of the goods to the list that you've got.

The debate that exists here - and I don't think it's terribly important how the debate arose . . . . Certainly the

[ Page 2866 ]

Consumers' Association of Canada, the British Columbia branch and the national branch, has every right to raise the warning of the problems that are inherent in this introduction of scanners where the prices are not left on the goods. That's a fairly legitimate argument that these people have. After all, they have made their reputation on the basis of a group of consumers coming together to form an association to seek straightforward regulations in terms of shopping in stores of all kinds. The basic tenet of the whole business of shopping was always that you had to compare, and the only way you could compare was by weight and price. So the Consumers' Association of British Columbia took the position that the prices should remain on the goods. They in fact took the position that Ontario took by agreement and the position that is inherent in the act in Quebec.

What we've had here - and I'm rather surprised that the minister would take the position that he has in respect to the failure to allow that the prices be kept on the goods . . . . He does not have to argue the case for the supermarkets; they can argue that case themselves. If they need somebody to argue the case for supermarkets, we can always get the Minister of Agriculture (Hon. Mr. Hewitt) to do that.

Good afternoon, Mr. Minister of Agriculture.

I would draw the minister's attention to a press release that came out of his office on June 3. On June 3, his office announced an education program for school children. The idea of the program was that they would learn about consumer protection. They'd learn about shopping practices and a number of things. Mr. Speaker, let me just read to you the press release of June 3, 1980, of the Minister of Consumer and Corporate Affairs. It says:

"The latest consumer education resource from the Ministry of Consumer and Corporate Affairs, a colourful game called Shop Hop, was unveiled Tuesday in a Richmond elementary school by Jim Nielsen, the minister. The game, which has been played for several days by students and teachers of the James Whiteside Elementary School, was designed for use in the elementary system. 'I believe that Shop Hop will be a useful tool in teaching the elements of comparison shopping . . . . . ..

Let me repeat that, Mr. Speaker. This is the minister talking to his future and soon-to-be constituents in the elementary school, and he says: "I believe that Shop Hop will be a useful tool in teaching the elements of comparison shopping . . . . .. He buys the basic philosophy of consumer protection and the kind of education that has gone on over at least the past 15 years - that if you want to shop wisely, you do it by comparison. He even introduced a game into the school so that this would happen. He said: "I believe that Shop Hop will be a useful tool in teaching the elements of comparison shopping, decision-making and budgeting."

Interjection.

MR. LEVI: Yes, those are all the basic components of sound shopping - comparison, budget-making and decision-making. The minister has been told by a number of people - by the Consumers' Association of Canada - and I'm sure he's read all the articles in the newspaper about the surveys that have been done. Nevertheless, the information is there. It was presented to the minister. I understand he was not terribly impressed with it. But nevertheless the information was there.

He goes on in his presentation about Shop Hop: "It was designed for younger students in our school system as a way of teaching basic skills in wise shopping decision-making, and making it fun. " That's good - making it fun. But I think that the minister has really started to make fun of the basic issues of consumer protection.

What we're dealing with here . . . . There are a number of items that he's covered, from credit cards to the tax-buyer people, to the future contracts arrangements, but he has not dealt with the issue - and I'm hoping that he will when he closes the debate - in a much more specific way than he has dealt with it heretofore in terms of the electronic scanner. The minister says that the game he introduced is teaching the elements of comparison shopping, decision-making and budgeting; he better apply those principles and examine the problems that he's creating in allowing the introduction of the electronic scanner in British Columbia without any consideration to the problems facing the consumer. At the moment we have about 18 stores using them - probably less than 200, 000 people in there. But what we have to deal with . . . .

I'm taking a deep breath because I think the Speaker is having trouble relating what I'm saying to this, and I'm talking about consumer protection.

DEPUTY SPEAKER: Thank you, hon. member. The Chair is having some difficulty, particularly with the reference by the member to electronic scanners, which is not contained anywhere that I can find within the bill. I must remind the member that debate in second reading should be confined to what is actually in the bill. I think we have exhausted the broad passing reference aspect.

MR. LEVI: Mr. Speaker, the principle of the bill is the principle of the act, and that is consumer protection. That's what we're talking about. That's what is implicit in all of the things that the minister has said. It's true that he has brought in some amendments. Nevertheless, the principle not only of the bill but of the act when it was brought in was the whole issue of consumer protection - the whole issue of comparison, whether it's comparison shopping or comparison with future contracts; whether it's making comparisons about which tax-buyer gives you the best break. Nevertheless; we're talking about consumer protection. Now, I'll certainly not push the issue too far, because I've almost finished my remarks anyway.

The key thing, Mr. Speaker, is that if the minister goes as far as he did in the introduction of the game that he introduced in the school in Richmond . . . . Because he re-enunciated some of the principles. He talked about comparison shopping, decision-making and budgeting, and that's implicit in this bill. People have to make the decisions. I agree that we should stay away from legislation where we have to legislate in order to make up for, in some cases, people's inabilities and incompetence in terms of making decisions.

But to go back and touch briefly on what I was saying, if these are the principles that the minister subscribes to, then I think he has left out a large number of future consumers, not only the present ones who are involved in the supermarkets where there is the whole different pricing arrangement and accounting arrangement, but there is that whole question . . . . How is it that he can enunciate these principles and at the same time ignore the problems that are being created?

[ Page 2867 ]

He's also on record as saying that in some way the consumer has to forgo something - that it's not always possible to do everything in terms of the consumer. I think he's quoted actually as saying that the erosion of price consciousness of consumers must be balanced against the costs to the consumer. In terms of the issues that I talked about, one of the surveys showed that consumers are already prepared to pay half a cent more on any goods so that they can retain the packaging. This is one of the results of that survey. That's in the information that the minister was given by the Consumers' Association of Canada - that they would be prepared, simply for the benefits of having adequate consumer protection, to pay a little extra. If the minister says the erosion of price-consciousness of consumers must be balanced against costs to consumers, then he has, from a number of consumers - more than 4, 000, if you take the 3, 500 from the Sun and 900 from the Consumers' Association of Canada; they may duplicate one another . . . . You have a significant number of people saying: "Yes, we understand the principle - the erosion of price-consciousness of consumers must be balanced against costs to consumers -but we're prepared to pay a little extra, because we subscribe to the principles that the minister talked about when he introduced the game to the students. "

The minister has not really taken a good look, in my opinion, at this particular issue. I would ask him to review the judgment that he's made and to somehow make it possible for consumers to have a test situation. I would say that had he taken the Ontario approach and then the gradual introduction of the machines across the whole province, the people would have been educated and understanding and it might have been a little easier than it is now. But he didn't take the middle road; he took what appeared to be the non-interest road. That's the problem, he's taken a non-interest in this and it really defeats very much the basic tenets both of the legislation and of the amendments that we're dealing with here, which is the whole issue of giving consumers protection where it's required to be given by law.

I'm not a great subscriber to the idea that we should have pages and pages of regulations but somehow people can only live that way. On the issue of what the minister has called the comparison shopping, a basic element of consumer protection, he has failed to do this. Yet he has taken the trouble to look at some of the other issues that he needed to deal with, especially the issue of the credit card. That's a good amendment - to prohibit credit card companies from charging interest on outstanding accounts if the payment has been deposited with an authorization but not yet received by the head office of the credit card agency. Yes, that's a problem.

Unfortunately, in terms of the banking industry in this province, the minister doesn't have any kind of control. He should be telling the banks to start reducing the interest rate. We can't even get the federal minister to do that; he doesn't have that kind of jurisdiction. But it seems that when it comes to resolving those kinds of problems we have to have legislation.

We've already discussed the tax rebaters. Now we talk about the credit card issuers: "to shorten to 90 days the notice that the credit card issuers must give credit card holders of an increase in the interest rate. " Now we are near to the problem that was raised in the House of Commons in Ottawa last Friday. It's an unproclaimed section, though. Previously there were some problems with it when it was introduced. One would hope that this Section 1s really acted upon because it's a serious problem. Where we have inflation rates going up and down, there has to be a very quick response from people who are dealing with placing interest on loans. The response must be immediate or almost as immediate as possible in terms of the changes in the interest rates. That's not a difficult problem because there's now a great utilization of what's called EFTS, the electronic transfer arrangements, and that shouldn't take very long to do. But we have to get the companies to be much more responsive than they are. As I mentioned, we're still having some trouble with the chartered banks doing something about changing the interest rate. The minister has indicated here that when the Section 1s proclaimed he can do something about that.

The other parts of the legislation I suppose in a way are a comment . . . . I don't mean this unkindly to people that draft laws-, I know it's tough. I once watched them do a process of drafting legislation. It's a very difficult process. We've not been overly successful in some of the legislation that we've had to deal with it. Part of it, presumably, is drafting problems. Part of it is decisions that are made in other provinces that make some of the legislation not as useful as it was intended to be when it was written.

Mr. Chairman, in summing up, the bill deals with the protection of the consumer. There are some examples of the need and what the minister is going to do in terms of protection of the consumer. I've raised another one, albeit not in the bill but in the principle of the bill. I must point out to the minister that 11 d been warned about dealing with what I was dealing with. but 1 hope the minister, when closing debate, can indicate to me whether he's had, in fact, a change of mind. I would think he has as a result of the introduction of that [illegible] where he talked about the basic principles of comparison, judgment and decision-making. We can expect some change in the approach that he's heretofore exhibited in respect to those new pricing machines. There certainly needs to be something done about it.

MR. LEGGATT: I wanted to add a few words of support to the remarks from my colleague from Maillardville-Coquitlam (Mr. Levi) around the question of the minister's decision not to intervene with respect to the use of the automatic scanning techniques presently being employed by many of the supermarkets in the lower mainland. There is a principle that's involved here that perhaps the minister has -I won't say failed to appreciate - but perhaps hasn't given sufficient emphasis to. That is, first of all, the responsibility of the purchaser to make sure that the product is priced properly and that there is no discrepancy between the price that is shown on the shelf and the price that is run through the scanning equipment.

There has been some interesting work done in the United States on this particular subject. In fact, the figures will probably show that the discrepancies are very slight, that, in fact, the electronic machine is doing what it was intended to do, that probably on a broad basis it is fairly accurate in reflecting the price of that supermarket product as it passes through the electronic reading screen.

That is not the real issue or problem. The question is providing the shopper with price consciousness. There is less price consciousness when the price is no longer on that particular product, when the person does not pick up the product, handle it and look for the price on it. The result is that these kinds of machines, while they were presumably originally designed to process a greater volume of food at

[ Page 2868 ]

lower cost, can have the reverse effect. In fact, the purchaser has less price resistance as a result of the use of the scanner.

It is really a part of this whole technological revolution around the distribution of foodstuffs. It is a part of the bigger-is-better technology syndrome against which the public really cries out to the minister for some kind of protection. However, they are not receiving that protection. I hope the minister was misquoted when I read in the paper that he suggested he was siding with the companies in regard to the question of the scanner. His job, of course, is to protect the consumer. A part of that protection is to be sure that the consumer has an opportunity to be price conscious and also is able to double-check between the labelled price on the shelf and a stamped price on the product itself.

There is, of course, the question of the working conditions of those who are involved in working at the cashier's desk and the loss of those skills that cashiers have. In fact, you could probably look at the scanner as the beginning of the end in some ways for the wage rates that cashiers receive, because the skill that is required in simply pulling that piece of food across the scanner is very different from having the capacity to ring those products up on the cash register. The result is that in the long run that skill will be lost and will no longer receive the kind of salary that it should. So I must say that I am disappointed that the minister hasn't been more aggressive in intervening in regard to the use of these scanning techniques around the use of food.

There are some things in the bill which I think are very useful. I particularly appreciate section 10.

"Section 24 (4) is amended by striking out 'selling contracts for health studio services in the course of business on the date this section comes into force, ' and substituting 'who on the date this section comes into force is in a business that includes the provision of services of a prescribed type or class to be rendered in the future on a continuing basis under an executory contract. ' "

I presume that is a further attempt to control the kind of promotional selling that has been going on in health studios. This kind of dance-contract and health-studio madness that all of the great techniques of sex and loss-leaders are selling, that we have all heard so much about . . . .

Interjections.

MR. LEGGATT: That's the only thing that wakes anybody up in here - to say - sex."

Interjections.

MR. LEGGATT: At our age it's nice to think about it every once in a while, when we are engaged in such a spirited debate around the bill.

In any event, I trust that is a move in the right direction, in trying to get better control over the conning that has been going on by many of these operators. The two worst offenders that I have found are the dance studio people and the health studio people, where long-term contracts are entered into with very questionable tactics at the beginning.

Section 37 (3), which I was interested in, says: "No discounter shall acquire a right to receive a refund on behalf of a taxpayer from the government of Canada until the discounter has paid no less than 85 percent of the refund to the taxpayer." I really welcome that section. I congratulate the minister for including it in the legislation. Tax discount ripoffs have been a national scandal in this country for a long time. Quite frankly, I think that the 85 percent is being too kind. I think we could outlaw tax discounting entirely and put the government in the position of the tax office in advancing those moneys against the refund owing to the person. For too long now we have allowed the income tax department to deduct taxes. They give you no interest on those deductions. They withhold those taxes from the taxpayer, and therefore allow the taxpayer who has no money to be a victim of the tax discounter. He has a very serious problem when he's broke. You have to put yourself in the position of someone who is completely up against it and without a dime, who needs money to pay the rent and who has a refund coming. The real problem is because of the way we collect taxes.

Interjection.

MR. LEGGATT: I'm not arguing with the minister. He's probably quite correct on it. But I do think it's time, Mr. Speaker, that we perhaps had another look at the procedure of income tax, where those people who are wage-earners have their taxes deducted at source, without any interest paid with regard to the use of that money by the government; whereas those who pay quarterly, for example, get away much better; and those who put themselves into various fiscal years and avoid the payment of tax - which many lawyers and many other professional people do - have a very special advantage. It seems to me that there are two laws. I'm the first one to admit, through you, Mr. Speaker, to my friend the Minister of Health (Hon. Mr. Mair), that, of course, we all take advantage of whatever is there.

Interjection.

MR. LEGGATT: Oh, yes, the minister does, I'll tell you. Nevertheless, there's the law for the professional and another law for the wage-earner, who has to have his taxes deducted off every cheque. He doesn't get a dime's worth of interest on that money; and then, of course, if he's a low-income person, he's a victim of the tax discounter at the end of the year when he's out of money but he's got a refund due. It seems to me that one of the problems that I know the minister is trying to solve in terms of tax discounting under this particular legislation would be a way those taxes could be . . . . Certainly there should be interest paid in regard to those particular taxes.

Interjections.

MR. LEGGATT: I take it we're supporting this bill, are we? [Laughter.]

Interjections.

MR. LEGGATT: As the minister knows, that's the full secret of success here - it's flexibility.

In any event, I just wanted to make these few remarks about my disappointment particularly in that the very serious problem of the electronic scanner has not been dealt with nor has the minister come to grips with that problem. I think it's something that hopefully another government will do something about.

MR. LEA: I'd like to talk to the minister about a subject

[ Page 2869 ]

that I believe is something he would be interested in looking after if indeed it's happening in British Columbia. It's called point scoring, in terms of applying for credit. It's been happening in the United States, but luckily the United States legislators have been doing away with it. Basically point scoring is where you go into, say, a large department store and say: "I'd like to apply for credit. " So what they do is to run you through their computer in what they call a "point scoring" way. I have one here which says: "Typical consumer credit point scoring system. " First they look at how long you've lived in an area - over five years, two to five years, one to two years - and each one has a different point. They shove this information in the computer and it comes back "good" credit or "bad, " based on this point-scoring system. For instance, they may have had back luck over the years with MLAs.

AN HON. MEMBER: How did yours come back?

MR. LEA: Mine came back with a perfect score. I did my own assessment.

Interjection.

MR. LEA: True. I'm glad. But I think it's very unfair. MLAs may have had, as a group, a bad record of credit payment. Along comes an MLA like the first member for Vancouver South, who has never needed credit because he inherited it . . . .

HON. MR. ROGERS: I pay cash.

MR. LEA: I'll bet you pay cash - socks of it, made by granddad. For those of us who live in the real world, we sometimes have to apply for credit.

MR. BRUMMET: Maybe he earned it.

MR. LEA: Maybe he earned it, but I'm glad you put the -maybe" in. I know you earned yours.

Anyway, getting back to point scoring, which is what the members of the opposition over there are trying to do now: score points. For instance, if you were an MLA and you applied for credit, and MLAs as a group had a bad record of payment, then they would say: "Oh, you're an MLA. We'll put you down, out of I to 10, as 3." It goes into the computer. They ask: "Where do you live?" You might say: "I live on East Hastings. " They would say, "Oh, that area is for low-income groups, " or, "The houses in that area are only worth a mean average of $60, 000, so we'll put him down as a 5. "

In the States they've been using the zip code; here they'd use the postal code. Where you live determines what kind of a rating you get in this scoring. It doesn't matter what kind of a record you've had in paying. They say: "Occupation: managerial, professional or skilled - give him 6. " But if you're clerical or semi-skilled, they'll give you 4; if you're retired, they'll give you 3; if you're unskilled or seasonal, 0. Family status: married with one to two dependents, they'll give you 6. But if you're married with three to four dependents, they'll drop you back to 4; single female or widow, they'll drop you back to 3. If you're a single male, and all others, then 0. If you own or are buying a house you get 4; if you're renting, you get 2. Total income over $25, 000, 6. It goes on and on.

For instance, ''In the United States, Amoco Oil Co. has agreed to pay a $200, 000 civil penalty for discriminating against blacks, women and others in granting credit, the Federal Trade Commission announced Tuesday. The firm also will stop using zip codes as a guideline in deciding whether to issue credit cards, the announcement said. "

I'm not sure whether this is going on in Canada and whether it's going on in British Columbia, but if it is I'm of the opinion that it should be stopped. There is some good that comes from computers, although I haven't quite figured out what it is yet.

DEPUTY SPEAKER: Hon. member, I am having great difficulty in trying to relate the member's remarks at this stage to the second reading of the bill presently before the House.

MR. LEA: What is the name of the bill again?

DEPUTY SPEAKER: The name of the bill is the Consumer Protection Amendment Act. Hon. member, what is spelled out in the bill certainly can be discussed, but what is not spelled out in the bill ~ . . . If we do not confine debate .... For example. the remarks the member is now making would possibly best be made under the estimates of the minister or in some other . . . .

MR. LEA: Under the minister, as you know, Mr. Speaker, I can’t call for new legislation.

DEPUTY SPEAKER: That is true, hon. member.

MR. LEA: You are saying that I can't under bills. At what point can a member, then, appeal to the minister for needed legislation?

DEPUTY SPEAKER: I am not here to advise the member on that, but I am here . . . .

MR. LEA: You are here to do that, sir. You've advised me that I can't do it under bills or estimates.

DEPUTY SPEAKER: Hon. member, I am advising you at this time . . .

MR. LEA: to write a letter.

DEPUTY SPEAKER: Something along those lines.

MR. LEA: I'll be very brief, Mr. Speaker.

DEPUTY SPEAKER: I would appreciate that because it is very difficult for the Chair to continue to allow debate on an item that is not covered in the bill.

MR. LEA: I am finished; but I would like the minister, in summing up, to possibly mention briefly whether or not he knows whether this practice is being carried out in British Columbia. If it is, what is the minister's opinion of such a practice and what does he intend to do about it? It just seems to me that all too often in our modem-day society, when dealing with credit and especially huge credit lenders, more and more we're being dealt with not as individual human

[ Page 2870 ]

beings, but as numbers and codes and point systems in computer banks. It seems to me that the more we go down this road the less chance we will have of being individuals within a society and we will have 1984 long before we should - not the year, but the meaning that we all put behind 1984. 1 would just like the minister, when he winds up this debate, to mention briefly whether he knows whether this is happening in B.C. and what his opinion of that is.

MR. HOWARD: Mr. Speaker, the bill before us touches on a subject matter that has been the concern of consumers probably ever since there have been consumers. Its purpose and intent, like those of the act itself, are to protect against abuses perpetrated on consumers in the marketplace. That's the sense of it. It's to say that consumers need to be protected against the merchant class, the manufacturing class, the retail class or whoever they're dealing with. It reflects, I think, the historic fact that consumers, generally speaking, are at the mercy of the person who manufactures or sells the goods and items. Historically, protective legislation of this nature has always lagged behind the abuse. Historically, the abuse of the consumers' interests in the marketplace has been allowed to develop and get to proportions beyond reason before government moves to put into place some protective mechanisms to assist the consumer and to ensure that he is not abused in the marketplace.

We go back not too many years, when the weights and measures activities of producers were used to deny the consumer a fair shake. Weights were purported to be one thing when in fact they were something else. Producers of canned goods in the earlier days would compete against each other, not on quality but upon deception. A producer of canned goods, in times past, may have sold a 16-ounce can of a certain product. Later he would find a competitor producing a larger can with the same quantity of goods inside it in an attempt to mislead the public into thinking that it was buying a larger quantity of goods for the same price; or, alternatively, putting less in the can and representing them as something else.

It was quite a common practice with used-car dealers to put sawdust in the transmissions - this was before the days of automatic drive - or the rear ends of cars in order to deceive the purchaser of the car into thinking that there was nothing wrong with the transmission, the rear end, or the differential system of the car - a device used, so I'm told by my forbears, not from any personal experience. My brother certainly ran into that situation. But that was common practice in the used-car industry.

Another common practice was to set back the odometer in order to deceive the buying public into thinking that the car had only been driven to and from church, when in fact it may have had 50, 000, 60, 000 or 70, 000 miles on it.

Interjection.

MR. HOWARD: The Minister of Agriculture (Hon. Mr. Hewitt) - what's he saying to me? Did I do that? Ask me if I did that. I'm an honest man, and that thought would not have crossed my mind. I notice it crossed the mind of the Minister of Agriculture as being a possibility. I've always perceived that those who think of such things are likely to have done them themselves.

Interjections.

[Mr. Strachan in the chair.]

MR. HOWARD: Oh, there, we've got the Minister of Forests (Hon. Mr. Waterland) now getting into the act -hiding in the comer, not even prepared to sit in his seat and debate the question. But never mind that.

The point is that anyone who's paid any attention to the question of what happens to the consuming public hears of these abuses, and knows that they take place. The point I'm trying to make, and I think validly, is that protective legislation-protective of the consumer- always comes along too little and too late.

My friend from Prince Rupert raised incidents about computers and a coding system to deny consumers a fair shake in their dealings insofar as credit ratings are concerned. That abuse - and it is an abuse - will undoubtedly continue and more of the public will know of it, and eventually government may bestir itself to take some corrective action. Now is the time to take protective action, not later.

The member for Coquitlam-Moody (Mr. Leggatt) talked about the scanner systems developing and being used in certain supermarkets.

MR. LEA: Stephen Rogers had trouble with a yacht dealer.

MR. HOWARD: Well, that's beyond the ambit of my knowledge, people who deal with yachts and so on.

But the point is that in North America, Mr. Speaker, people have known of the development of the scanner system for quite a number of years now. The potential dangers to the consumer have been outlined many, many times, and we find no indication that government has paid the least bit of attention to that development. That development can be used to abuse and to take the consumer, to dig into his or her pocket unbeknownst to that individual and to the credit - not in the pleasant sense - and the benefit of the supermarket and the superchains. There is no recognition in this bill that there is anything of that nature that's recognized or that any protective action should be taken.

A number of years ago - 20 perhaps or something of that sort - a gentleman by the name of Vance Packard wrote and had published a very revealing book called The Hidden Persuaders, which in its time was a best-seller. Packard outlined and documented numerous instances where the consumer's rights were infringed upon by manufacturers, distributors and retailers of consumer products. He mentions instances of improper pricing, of labelling a product with a certain price on special higher than what it was normally, but using the idea of something being special to suck the consumer into buying it at a higher price.

The traditions that we know about indicate to me that government is not really serious about dealing in the area of consumer protection. While the bill before us - commendable in its content - makes moves in the direction and does protect in certain areas and does seek to control the abusiveness of the private enterprise system, it does not really touch the core of the problem. I would far sooner see in this chamber something that recognizes what is currently developing, and takes steps to nip it in the bud before it becomes a raging and rampant activity in the marketplace, to the point where the voices of consumers who are feeling that their rights have been infringed upon enough suddenly be-

[ Page 2871 ]

come more and more of a public clamour and government will listen to that. It isn't good enough simply to wait until the public becomes knowledgeable enough about these things that are happening to it and then for government to respond to that public clamour. It's much more proper and more sensible for government to exhibit some leadership in this area, to [illegible] recognize what exists right now and take steps to cope with it.

While, as I said, the bill is supportable and will be supported, it's just a faint move and recognition in the direction of t ' he need to have a full-scale and proper and thorough bit of legislation to protect consumers who have been abused often enough and long enough, probably abused by many in this House who in their business life may have had some activity in types of businesses where abuses have taken place - maybe.

I'm not a businessman; I don't know it from that point of view. I'm a simple, ordinary consumer, and I know it from that point of view, Mr. Speaker, and I'm sure you do as well. The consuming public certainly always has to be on guard, always has to be prepared and always has to expect that something unkind is going to happen to him in the marketplace, that he's going to be taken advantage of. But it isn't good enough to leave the individual at the mercy of whoever wants to take advantage of him. It would be much more valuable if the minister were to write something and bring something into the House that reflects current-day needs and not the abuses that have been taking place for the last 10 or 15 years, which finally are going to be dealt with and plugged a little bit.

MRS. DAILLY: First of all, 1, too, would like to commend the minister for the positive features of his bill. I think we would agree that anything that brings in further consumer protection is a positive step, but I also am very concerned about the omissions in this bill. I'm wondering if the minister, in his travels since he's become a minister, has had an opportunity perhaps to visit Quebec and study their consumer legislation, which I consider to be very progressive and forward legislation. Mr. Speaker, if I may just give an example, which is, I think, applicable to the bill in the areas of omission, here are some of the things which have been brought in by the former minister - I believe it was Mme Payette - in the area of consumer protection. One of them was that lottery ads must disclose the chances a ticket buyer has of winning.

AN HON. MEMBER: None!

MRS. DAILLY: You could be right.

Mr. Speaker, I think this is something that I hope to go into further when we're discussing the whole matter of lotteries with the Provincial Secretary (Hon. Mr. Wolfe), whose jurisdiction they come under. On the other hand, it still would rest with the Minister of Consumer and Corporate Affairs, I believe, to bring in the actual legislation. I consider that a very interesting piece of legislation which I hope our minister here would give some consideration to in discussions with the Provincial Secretary.

They have also brought in, to do with the whole matter of automobile repairs - which 1 think, of course, is something that we've all been plagued with through our lives and will continue to be as long as we drive . . . . What they have brought in in their consumer legislation in Quebec is that the estimates on the repair of automobiles must be met to the penny unless the owner is advised before the repairs are made and agrees to a price higher than the estimate. As well, all auto repairs must be guaranteed for 5, 000 kilometres or three months. I think that kind of legislation is the kind of legislation that would be received with great joy by the consumers of British Columbia, and this is the kind of thing that I'd hoped that perhaps we might be seeing in this bill. By the way, that estimate section that applies to automobiles also applies to household appliances - fridges, dishwashers and stoves. A three-month guarantee must go along with that work as well.

The last point I want to make that comes from the Quebec legislation is something that has been discussed at considerable length already, so I won't spend too much time on it. But I would like to back up my concerns about this particular area. In the Quebec legislation they actually state that a price must appear on all products, including goods in supermarkets which have scanners. This is done now in one province and we simply cannot understand why this minister has been so stubborn in refusing to listen to the consumers of British Columbia on this matter of price-tagging with the scanners. You know. what I find rather shocking, Mr. Speaker, is that our Minister of Consumer and Corporate Affairs . . . . I should say "corporate affairs" first, because when he was asked why he would not move on it he said that he would not in any way order B.C. scanner supermarkets to retain item pricing, because - and this is the quote - "I have to defend the corporation as much as the consumer. "

All right, let's analyze that comment of the minister's, because it has been proven that the basic issue in the price tagging in the scanner stores is simply this: the consumer, who is denied the individual item pricing, stands to lose price awareness, and this erodes the resistance of the buyer in a supermarket to food price increases. Now that is one of the biggest problems, and this minister, in taking the side of the corporations, is simply completely, in my opinion, giving up his responsibility to the consumers of British Columbia in favour of the corporations, because, in other words he says: "I must do it for the corporations.- In other words that means: "I'm going to help the corporations make more profits. '' By not putting in the price-tagging, the consumer's price awareness is eroded. I would like to hear comments from our minister as to why he has decided to take the side of the corporations in what we consider to be a very basic issue for the consumer of British Columbia. In these times of high prices here is something positive that that minister could do to help people be more price conscious, and yet he has abrogated his responsibility. What I consider is very symbolic of this minister is that most of his legislation, adequate as it is, is just that - adequate. But this legislation is not imaginative and does not come down to some of the very basic crunch consumer problems of today. I feel that it's a great disappointment. My biggest concern about the minister who brought in this bill is that all his utterances and even his legislation seem to point to the fact that he is more interested in maintaining the profits of the corporations of this province than in protecting the interests of the consumers.

MR. MUSSALLEM: I'm so pleased to take my place. Of course, as everyone in this House seems to do, I support the bill in its form, indicating that it ~ s a good bill in favour of the consumer and business alike, and that makes a good bill.

I just couldn't let pass the remarks of the hon. member for Skeena (Mr. Howard) when he referred to sawdust and

[ Page 2872 ]

transmissions. I've been in the automotive business a long time and I have not known yet of any sawdust in a transmission, although I've heard a lot about it. It's the same story you hear about these new carburetors that are hidden away from public view that'll get 200 miles to the gallon. I've never seen those either. A great deal could be said for sawdust in the transmission if it works. I'd like to know, if somebody could tell me, how you'd get the sawdust in there in the first place and if it did get in there what good it would do. That's one thing nobody in the business yet understands but it's a great story. If the hon. member for Skeena enjoys it, I think he should.

But I want to say that this government and our previous Social Credit government have always been conscious of the consumers' point of view. It was our government that brought in the odometer law and recently the sticker law and these things. I'm referring to the automobile business in particular. It has done a great deal for the industry. The odometer law by itself has established a stability in the automobile business, particularly in used car lots. There's no longer the question of who rolled this back. Mind you there's still some of it going on, but mighty little. The consumer is well served by the new system. It has brought stability even to what was formally called the "gyp lot." There are very few of these now. Because of our legislation there's been a step forward. There are very few gyp operators because there's no room for them in the business. There's hardly anywhere for them to operate. Oh yes, there are always sharp operators in every business, but by and large the automobile business has come of age. I compliment the minister on his work in this field.

I have to agree with the member for Burnaby North (Mrs. Dailly) when she says that the scanners should be looked at askance. I think they're a bad thing. I do agree that it takes away - and I bring this to the minister's attention - the individual interest in pricing. You'll find that today in supermarkets when a price is on a shelf, the customer no longer asks what it costs; they grab it and put it in the basket. And if we get away from the idea of being conscious of the price of an article, then we fuel the fires of inflation. I believe that the member for Burnaby North made a good suggestion, and I would like to see the minister take some cognizance of this. Individual pricing may be a small, trivial cost to the supermarket - a most infinitesimal cost - yet it displays the price on the article. I think the minister could well look at this point. I think it's a point well taken. As a House that is certainly together on this bill, I just want to compliment the minister on his effort, but it would be well for him to consider those suggestions.

MR. NICOLSON: People in the House support this bill, as I think they supported the original introduction of the Consumer Protection Act. One matter has been brought to my attention, and I think that the actual deed occurred a few years ago - maybe about three years ago . . . . I would hope that the minister, in terms of bringing in improvements, as he's attempting in this Bill 14, would give some serious consideration during the next year to packaging.

I have here a couple of packages of beans, Mr. Speaker. This one is marked 8 ounces, and the price is 59 cents. They're put out by the A. E. McKenzie Company, and I think that the McKenzie seed catalogue is a fairly well-known one. The following year, this package was put out. You'll notice the new slim, improved version. There's no marking of how many ounces are in it, The package is still sealed. I'll send them over to the minister. I'll table them, if you wish, Mr. Speaker. As I say, this incident I think happened about three years or so ago. This one probably doesn't contain 8 ounces now, but that's because it was opened and it did spill. So that is not the complaint. Both were marked 59 cents. There was no increase in price, But there was a tremendous downward reduction, probably four fold or more, of the amount of goods being offered. I think this is the kind of deceptive practice that we should look at. When otherwise reputable firms would do this without even changing the picture being used on the package, it is something that should be looked into.

1 would ask one of the Pages to take those over to the minister. I would hope that next year a similar bill will come in and perhaps address itself specifically to this problem. It might be that as a deceptive practice it might be addressable now. I think this is something that could be looked at. Notice could be served in British Columbia that this type of thing is very much out of order. We should try to do something in order to put an end to this type of deceptive packaging.

MR. LORIMER: Mr. Speaker, we have heard about the scanners. That has been dealt with at some length. It appears that both sides of the House are agreed that the scanner system should be done away with, so we are hopeful that there will be another amendment coming forth from the minister dealing with this problem to outline the scanner system in British Columbia.

I want to deal with the question of mortgages and the mortgage lender. It is a small point, possibly, to people who are able to pay their mortgages when due and so on; but to someone buying a house today at the exorbitant prices being charged now for housing who suddenly finds himself out of work, the question of foreclosure becomes very apparent to him and he knows it will soon take place. One of the problems in our mortgage documents at the present time is the option of judges allowing the court costs and fees to be charged on what is called a solicitor-client basis instead of a party-party basis, which increases the costs of redemption by a substantial amount.

When someone is in the process of losing their house, the redemption period for them to find a new buyer is allowed. That's true enough, but the new sale has to be increased because of the practice of allowing these costs on a solicitor-client basis rather than a party-party basis. It adds hundreds of dollars to the cost of redemption. Those individuals may be small in numbers, looking at the total population, but they are obviously the people who may be unemployed and are certainly the poor economic group in our society. In my opinion, they are being abused by the practices of solicitors applying for the costs of the action on the solicitor-client basis. I would like the minister to look into this. It is my opinion that that should not be permitted. There should be no options given to the judges of this province to allow the lawyers of our area to take advantage of those people who are in the process of losing their homes. There is refinancing to pay the costs of the moneys outstanding, the cost of the interest that has been accumulating and then on top of that the additional costs of a system whereby we allow the court costs to be based on a system which was not intended for that purpose. There is no question in my mind that the costs should be party-party costs and not solicitor-client costs. That, as I say, may be a small matter to most of us who

[ Page 2873 ]

haven't been foreclosed on, but for those who are it becomes a substantial matter of concern. As I say, we are dealing with the lower economic echelon of our society, and I think that this act should be set up to protect these people over and above those that are financially able to protect themselves.

MR. COCKE: I would like to compliment the minister on his accepting responsibility for taking care of the income tax discounters. I hope that this notice will be adhered to by the people who are loan sharks in our society.

However, the one thing that disturbs me a little bit is the conflict of interest in the minister's portfolio. It strikes me that to be a consumer advocate and at the same time to be a corporate advocate is very difficult to achieve. The minister showed that in terms of his total lack of regard for the consuming public over the scanner situation. I don't necessarily agree with my colleague who said scanners should be done away with. Maybe they are at least something that can complement the retail business. One of the reasons the retail stores want to not only use the scanner, but also want to stay away from pricing on the article, is because, using the scanner in tandem with the computers that run pricing, that pricing change can be achieved by pressing a button down in Florida. You can be walking from where you picked up the article to the checkstand and find that there's been a major change in price. That's happening in our sister country, the United States, and it's going to happen here. I believe that the pricing should be on the article, that I should at least know that from when I pick up that article till I deliver it to the checkstand the price isn't going to change on me.

Another thing on which I certainly agree with my colleague from Burnaby North is that the less price-conscious people become, the more they can be manoeuvred and manipulated by the retail business. I really think that this government should show a little bit of responsibility. Under the umbrella of consumer protection, they should make awfully sure that the whole scanner thing is brought under the control of the provincial government, to the extent that at least pricing is guaranteed on the article that one picks up and carries to the checkstand, so that one understands what one's basket contains in terms of expenditure. I think the minister can offer no less than that. He has shown absolutely no interest in it to date. As I recall a comment, whether it was around this or another issue, he wants to be ultra fair to the corporations. If that is the case, then it would strike me that this whole conflict of interest within that department is showing heavily in the favour of the corporations.

HON. MR. NIELSEN: Responding to some of the comments which have been made, I suppose the main concern identified is one which is not contained in the bill, and that is to do with scanners. It is interesting to hear the various comments made by members and citizens in our province about scanners. I am very pleased today that nobody in the House suggested that scanners do away with prices in the stores, as has been suggested by some other people. I am pleased to hear that no one in the House today placed any validity on a survey which asked people if they felt there was any value to having items priced and an overwhelming "yes" response was received, which one would expect.

Our officials have done a tremendous amount of work on analyzing the scanner phenomenon in North America. It is our information, although it may not be absolutely correct, that Michigan is the only state which has attempted to bring in such legislation. California has some counties or cities which have attempted some legislation. They allowed their own legislation at the state level to die by way of a sunset clause. The member for Burnaby North may be more up to date than information we have in the ministry, but our understanding is that the Quebec legislation is unproclaimed, has not yet been brought into being. We have been speaking with officials in Quebec who have indicated that they're a little bit nervous about some of their legislation because they're not quite sure what effect it will have. We've been advised that it's unproclaimed, but perhaps that's changed in the last couple of days.

The argument over the scanners is generally reduced to the one specific question: that is the individual pricing of items on a store's shelves. Usually the arguments that come our way are to do only with grocery store shelves. One of the very real problems, Mr. Speaker, is how far do you go? Where do you draw the line? Whom do you exempt? What materials do you exempt? What type of regulations need you draft? What type of an act would you require? Do you go down the street here, on Superior Street, I think it is, or Michigan Street. and ask that comer grocer to itemize or individually price-tag all of his items on his shelves? Because he doesn't do that - a small corner store - he tags the package with the price. We conducted a reasonably good investigation and survey into how many stores do not price items individually. Well, almost all stores have a great cross section of items that have never been priced, or at least are not currently priced, and tradition has indicated they have never been individually priced.

One would presume if you were going to bring in legislation to do that, you would demand that every item be priced. But then it would be obvious to most consumers and shoppers that you couldn't individually price each item. There would have to be exemptions, such as quantities of material sold in bulk where you're not going to individually price each item.

We have a classification of traders, stores, who simply never have itemized their goods in that way. We have one of the most successful and new supermarket chains in B.C. called Quicksave. They have half-a-dozen or seven or eight stores in the lower mainland area, and they offer considerable savings to the consumer. By comparison shopping you can determine this. And the basis of that saving, according to the person who owns them, is the lack of pricing completely, along with selective purchasing of what items are to be sold; they do not carry perishable items. They offer considerable savings on brand names. In fact we received a petition from customers of Quicksave asking that legislation not be introduced which would in any way impede the style of that store.

It's interesting, Mr. Speaker, that we received copies of a survey which were signed by customers of scanner stores protesting against scanner stores, according to what we received. It seems that those people who were in the stores purchasing, using the scanner system, then signed a petition saying, "We don't like it, " when they could have walked across the street and shopped at a store that doesn't have the scanner.

It is an interesting argument. I was speaking with the ministers responsible in Alberta and Saskatchewan last week. They are also receiving protests from the same organization we are. I've done a survey of my own, within the ministry, and up until a columnist began a series of articles on scanners and the consumer organization began using the scanner issue as an issue. we had received virtually no letters

[ Page 2874 ]

over the past two or three years. It was brought to the attention of the citizens by way of newspaper and an organized petition, and suddenly we received many hundreds of letters. Up until that time, apparently the scanners were either not causing a problem with people or they were unaware of ~them. I am sure they weren't unaware of them.

The supermarkets in British Columbia have been asked by our ministry to respond to an outline of a code of conduct, if you like, with respect to scanners, should they utilize scanners. We have had a very positive response from them. I have stated several times, by way of communications to them, that my personal preference would be that they retain individual pricing. I think that it does assist some people in making purchases. I believe that the information which we have suggested they retain in the stores is quite suitable for a person who is shopping, using comparison. They should be able to handle that without any difficulty. We have asked them to guarantee to us that there not be any price adjustments during the day and certainly not from the time they pick up the goods until they reach the counter. I have been advised by our legal people that such would be a violation of an act; it would be a deceptive practice.

We have not said there never will be legislation, should it become needed in the event of identified abuse. We've spoken to our counterparts across the country, and they are having the same problems in attempting to come up with any type of legislation. Ontario, perhaps, was in a very fortunate position in what it did, but our scanners have been in place f or two or three years in British Columbia and it's only very recently that it's become an issue. It is very interesting that some of the people who have signed petitions complaining about the stores live in areas where they don't have such stores; they are opposed to it in principle, and I think perhaps some of them are somewhat misled as to what that principle may be. I find it very, very difficult to recommend to the Legislative Assembly that we impose legislation on the people of British Columbia which would involve massive regulations to solve what may not really be a problem - other than a perceived problem.

There have been many comments made by other members. I would just like to respond very briefly to some of them. To the member for Prince Rupert (Mr. Lea): our ministry is not aware of such credit rating classifications as he described in effect in British Columbia; they have not been brought to our attention.

The member for Skeena (Mr. Howard) went on for some time telling us about various ways crooks have operated in the retail business over the past few centuries. I suppose it goes back even further than that. It is interesting from an historic point of view, but other than that I guess it doesn't mean too much.

The member for Burnaby North made a quote. It was not a quote, but it was fairly close to something.

The story of the member for Dewdney (Mr. Mussallem) about the sawdust in the transmission is like the woman's dead cat in the grocery cart that everyone has found at some time in some city.

Thank you for the seeds from Nelson-Creston. I notice that one is for green beans and the other is for dwarf green beans, but I suppose they are the same thing.

Interjection.

HON. MR. NIELSEN: Maybe that's why they have a smaller box. I'm not sure.

I move second reading, Mr. Speaker.

Motion approved.

Bill 14, Consumer Protection Amendment Act, 1980, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. WILLIAMS: Second reading of Bill 16.

CONSUMER AND CORPORATE AFFAIRS

STATUTES AMENDMENT ACT, 1980

HON. MR. NIELSEN: Mr. Speaker, the miscellaneous act before us affects a number of the ministries' statutes: the Vancouver Stock Exchange Act, Trust Company Act, Securities Act, Society Act, Mortgage Brokers Act, Debt Collection Act, Motor Dealer Act and Trade Practices Act.

[Mr. Davidson in the chair.]

There are two significant amendments to the Trade Practices Act. Under the amendments, the courts would be authorized to order payment of up to $2, 000 to aggrieved consumers following conviction of a supplier. At the present time that would require a separate action. We feel that this will resolve many problems. Another section deals with the estimates question, which has been discussed somewhat today. We would permit by legislation to allow courts to decide whether an estimate in the actual cost of the service is within reason.

Motor dealers are caught up in our amendments to do with posting prices on vehicles. The former act was drafted in such a way that there was what one would refer to as a loophole. Motor vehicles and motorhomes will now come within that definition.

The Vancouver Stock Exchange will see an additional two public governors. This is largely because of the request of the Vancouver Stock Exchange to fill various sub committees.

Amendments to the Trust Company Act would raise the minimum share capital requirement from a quarter of a million dollars to $1 million.

Mr. Speaker, most of these changes are relatively simple changes simply to make the various acts function better and be more responsive to the realities of their purpose. I now move second reading.

MR. LEVI: Mr. Speaker, we'll be dealing with this bill more specifically in committee.

Bill 16, Consumer and Corporate Affairs Statutes Amendment Act, 1980, read a second time and referred to a Committee of the Whole House to be considered at the next sitting after today.

CLERK-ASSISTANT: Pursuant to standing order 73 (6), 1 have to inform the House that the petition presented on June 6 last, with leave of the House, by the hon. member for Cowichan-Malahat (Mrs. Wallace) is irregular in the following respects: first, the petition is not addressed to the Legisla-

[ Page 2875 ]

tive Assembly of British Columbia; second, the petition is without a prayer.

All of which is respectfully submitted, I.M. Home, Clerk of the House.

Hon. Mr. Williams moved adjournment of the House.

Motion approved.

The House adjourned at 5:55 p.m.

ERRATUM

Issue of Friday, May 23, 1980

(Volume 5 Number 11)

At page 2581, two interjections were wrongly ascribed to the Hon. Mr. Hewitt. The remarks were, in fact, made by Mr. Barrett. Text should read:

MR. BARRETT: I'll be right back.

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

APPENDIX

AMENDMENTS TO BILLS

21 The Hon. J. A. Nielsen to move, in Committee of the Whole on Bill (No. 21) intituled Residential Tenancy Amendment Act, 1980, to amend as follows:

Section [3:

By deleting section 16 (1) (a) (ii) and substituting the following:

" (ii) where his interest is held as one of 2 joint tenants or a tenant in common, holds not less than 1/2 of the full reversionary interest, or, ".

By deleting section 16 (1) (b) (ii) and substituting the following:

" (ii) where its interest is held as one of 2 joint tenants or a tenant in common, holds not less than 1/2 of the full reversionary interest. "

Section 49: In section 69.1 (5) (b) by deleting "paragraph (a) " and substituting "paragraph (c) ".