1981 Legislative Session: 3rd Session, 32nd Parliament
HANSARD
The following electronic version is for informational purposes only.
The printed version remains the official version.
(Hansard)
TUESDAY, MAY 19, 1981
Afternoon Sitting
[ Page 5645 ]
CONTENTS
Routine Proceedings
Oral Questions
Failure of Vancouver travel agencies. Mr. Barber –– 5645
Admission of boy to Riverview. Mr. Levi –– 5646
Committee of Supply: Ministry of Education estimates. (Hon. Mr. Smith)
On vote 56: public schools education –– 5647
Mr. King
Mrs. Dailly
Ms. Brown
Mr. Lauk
Mr. Cocke
Division on an amendment
On vote 57: post-secondary education-colleges and provincial institutes –– 5651
Ms. Brown
Mr. Lauk
Mr. Hanson
Division on an amendment
On vote 58: post-secondary student aid programs –– 5656
Mr. Lauk
Division on an amendment
On vote 59: Teachers' Pension Fund –– 5657
Mr. Nicolson
Mr. Macdonald
On vote 61: independent schools –– 5658
Mrs. Dailly
On vote 62: International Year of Disabled Persons –– 5659
Mr. Hanson
Ms. Brown
On vote 63: building occupancy charges –– 5660
Mr. Lauk
Division on an amendment
On vote 64: computer and Consulting charges –– 5660
Mr. Lauk
On the amendment to vote 64 –– 5661
Mr. Nicolson
Mr. Lauk
Division on the amendment
Finance Statutes Amendment Act, 1981 (Bill 13). Second reading.
Hon. Mr. Curtis –– 5661
Mr. Stupich –– 5661
Mr. Cocke –– 5662
Mr. Nicolson –– 5662
Mr. Hanson –– 5662
Ms. Brown –– 5662
Hon. Mr. Curtis –– 5662
Division on second reading –– 5663
Income Tax Amendment Act, 1981 (Bill 10). Second reading.
Hon. Mr. Curtis –– 5663
Mr. Stupich –– 5664
Hon. Mr. Curtis –– 5665
Social Service Tax Amendment Act, 1981 (Bill 12). Second reading.
Hon. Mr. Curtis –– 5665
Mr. Stupich –– 5666
The House met at 2 p.m.
Prayers.
HON. MR. CURTIS: Mr. Speaker, in the constituency of Saanich and the Islands, on Cordova Bay ridge in the Saanich portion of the constituency, there is a school by the name of Claremont Senior Secondary. There are approximately 25 students of that school in a group visiting the legislative buildings and our assembly. They are accompanied by Mr. Ruffles. I wonder if the House would make them welcome.
HON. MRS. McCARTHY: Mr. Speaker, we have in the gallery today visitors from Silver Spring, Maryland, near Washington, D.C. I would like to ask the House to welcome Mr. and Mrs. Arthur Cotts.
Oral Questions
FAILURE OF VANCOUVER TRAVEL AGENCIES
MR. BARBER: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs concerning the collapse of three travel agencies in Vancouver over the weekend. I heard the minister on the radio this morning busy denying that his department knew anything whatever about the impending collapse, and denying specifically that he had any kind of forewarning. I wonder, first of all, if the minister could advise whether or not he is aware that the principal behind the three companies which have now collapsed is one Stephen Milne, formerly the owner and operator of Redwing Travel which was itself the subject of much controversy some years ago, and which collapsed under surprisingly similar circumstances. Is the minister aware of that?
HON. MR. HYNDMAN: I'd make two observations to the member. Firstly, I'm somewhat limited in my comments, because at this moment argument is still continuing in B.C. supreme court on an application to place a receiver in charge of one of the companies in question. Secondly, based on the preliminary verbal advice I have, may I say to the member that the facts are quite complicated and may not be as the member infers. I shall most certainly table with you, sir, and with the assembly, a full statement on the factual background to the weekend events as soon as I have them.
MR. BARBER: This morning I spoke with Mr. James Bower of Red Velvet Tours in Vancouver, who advises me that in March and April of 1980 he advised the registrar of travel agents of the problems with these companies and this particular individual. He told me that he specifically advised that the trust obligations under the act for the disposition of trust moneys were not being met by this particular individual and these companies. He was told to mind his own business by the gentleman who replied to his call at the office of the registrar of travel agents. Has the minister any knowledge about this attempt made in March and again in April — more than a year ago — to advise his department that something was going wrong here?
HON. MR. HYNDMAN: With respect to that part of the member's question alleging certain questions and answers, I'll happily take those as notice and bring back particular replies. However, based on the preliminary information which I have received verbally, the member refers to episodes of 1980. May I caution the member that the facts as I understand them may be considerably more complicated than suggested. I'm suggesting that the issue to which the member has referred is apparently not the same as the issue which arose last week.
MR. BARBER: I'm well aware that it's a very complicated issue and there's more than simply the disposition of trust moneys at stake.
This morning I spoke with Mr. Edward Tiller of Frontier Holidays, who advises that in March and April 1980 he too phoned the office of the registrar of travel agents — this was more than a year ago — and advised them on more than one occasion that there were problems with the operation of this company — more than just the disposition of trust moneys. There were other problems as well, He was told that his attitude was "sour grapes," and he should stop bothering the office with his information. Is the minister aware that these phone calls were made and the information about these impending problems was provided to his department in March and April 1980?
HON. MR. HYNDMAN: Once again, with respect to allegations of particular conversations, I will happily take those portions of the question as notice and report back. Again may I say, with respect to the matters of March and April 1980 to which the member has just referred, that it is my preliminary understanding, based on verbal advice, that those concerns have been well addressed, well monitored and settled and were not in any way a source of the recent problems of seven days ago. This is why I say to the member that it would appear that here are two separate categories of issue, possibly but not necessarily involving the same company and the same people. I will most certainly table the complete and factual report with the assembly as soon as we have it. But it appears that there are two separate issues involved.
MR. BARBER: This is not the subject of a telephone conversation. On April 25, 1980, Mr. Douglas E. Cummings, then general manager of Horizon Coaches — a division of Horizon Coach Lines Ltd. — wrote to, the registrar of travel agents outlining the problems and additionally observed and alleged that an investigation under sections 5 and 7 of the act was required because cheques have been issued without sufficient funds because trust moneys were used for the purpose of buying out other travel agencies. He went on in that letter to ask for a competent and urgent reply. Again I repeat, Mr. Speaker: I'm well aware that there's more than one issue — that of the trust companies. Is the minister aware that Mr. Cummings' letter of April 25, 1980, drawing these several matters to the attention of his department. was not even acknowledged, much less replied to? I have that by telephone this morning from Mr. Cummings, who I phoned at his home. He tells me that he did not even receive an acknowledgement, much less a satisfactory reply to these several questions raised. Is the minister aware of this correspondence directed by Mr. Cummings to the registrar of travel agents a year ago April 25?
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MR. SPEAKER: I would remind members again that the purpose of question period is not to bring information to the House but rather to ask a question in as brief a form as possible.
HON. MR. HYNDMAN: Again, with respect to the portions of the member's question dealing with allegations of a year ago or today as to whether or not replies were made to correspondence a year ago, I will happily take those as notice and reply as to whether those allegations are correct. With respect to the problems of a year ago to which the member refers, we don't know yet whether or not those problems in any way were related to the difficulties that arose a week ago. My preliminary information is that the answer is no, but I will share that information with the House, Mr. Speaker, as soon as we have it.
MR. BARBER: On May 28, 1980, and again on July 24, 1980, I raised these precise questions in this House with the then minister, the member for Richmond (Hon. Mr. Nielsen). Is the minister aware, and was he advised when he took over from his predecessor, the member for Richmond, why the minister declined on both occasions to answer my questions and has to this date failed to answer questions on this precise topic that we raised not just in several phone calls or in a letter, but also on the floor of this House almost a year ago? Was the minister advised, when he took office, why nothing was done? I have yet to receive from that member a reply to these questions.
HON. MR. HYNDMAN: Mr. Speaker, again it goes to the suggestion as to why the member is perhaps being a shade hasty in his suggestions with respect to the concerns of about a year ago to which he refers. It is my understanding, based on preliminary verbal information, that those general concerns were very competently addressed by my predecessor and were in fact dealt with, and were not a source of any problem or concern at the time I assumed this portfolio.
MR. BARBER: It's no great excuse for failing to reply when one promises to reply to a question on notice in this House.
Can the minister confirm that this company, along with others run by Mr. Milne, was in default in the amount of approximately $170,000 under its trust fund obligations as of roughly March and April of last year?
HON. MR. HYNDMAN: I'll take that as notice, Mr. Speaker.
MR. BARBER: I wonder if the minister could advise how, now that this has happened, the roughly $300,000 anticipated to be claimed from the fund — that's roughly half of the current moneys deposited in the fund — shall eventually be repaid? Can the minister advise whether or not it is the policy that the travel agents, who are innocent and honourable, will have to make up out of their own pockets, as Mr. Milne apparently will not have to make up out of his, for this particular default and this apparent claim of roughly $300,000 from the fund?
HON. MR. HYNDMAN: Mr. Speaker, until we're satisfied as to what happened and why it happened, we are not in a position to make those statements. That is why I repeat that as soon as we have the precise facts and reasons, we'll be sharing the information with members and will be prepared to make statements, But again, I caution the member; he is making certain assumptions, inferences or suggestions which may or may not be true, and I simply say, based on the preliminary verbal information I have, a number — if not all — of the member's suggestions may not be correct. Until the government is aware of the uncontested facts as to what happened and why, we're not in a position to be able to answer,
MR. BARBER: I wonder if the minister could advise whether or not as of this date, apart from the several companies owned or operated by Stephen Milne — including Boyarski, Windmill Holidays and the rest of it — there are any other travel agents or agencies in default of their obligations under the Travel Agents Act and, in particular, under the trust fund obligations referred to in sections 5 and 7 of that act.
HON. MR. HYNDMAN: To the best of our knowledge, as of this morning, the answer is no.
ADMISSION OF BOY TO RIVERVIEW
MR. LEVI: I have a question for the Minister of Human Resources. Can the minister inform the House why a 14 year-old boy — he was 14 this past March — was admitted to the provincial mental hospital 11 days ago and is on the East Lawn Unit with adult mental patients?
HON. MRS. McCARTHY: In response to the member's question, I did not have knowledge of the young person until the publicity this morning. The young person mentioned was not a ward of the Ministry of Human Resources until after he was placed in the hospital by the family physician, a psychiatrist and the family.
MR. LEVI: He was a ward of the ministry when he was admitted. That's what I am concerned about — what the role of.... The minister shakes her head, but I'm telling you that he was. I spoke to him. The point is, how was this admission of a 14-year-old boy to Riverview accomplished?
HON. MRS. McCARTHY: Our ministry was not responsible for placing the child in Riverview. I am having the whole case investigated. I have been assured that the teenager was made a ward of the superintendent of child welfare after the admission, which was arranged by the physician, the psychiatrist and the family. I will bring a further report back to the House. As I say, I'm having it investigated, but our ministry was not involved in placing the child.
MR. LEVI: That's quite remarkable. There were some social workers involved from your ministry.
I have a new question to the Minister of Health. Can the minister tell the House whether it is the practice of the minister to admit 14-year-old children to the provincial mental hospital and place them with adult mental patients? Is that the practice within the ministry?
HON. MR. NIELSEN: Mr. Speaker, I would have to take the question as notice to determine whether it is either a practice or a policy, but I would be pleased to respond directly to that.
[ Page 5647 ]
MR. LEVI: I was hoping that we could get some sense of feeling from the ministers about placing 14-year-old children in adult mental hospitals. One minister says it's not her responsibility and the other one says he doesn't know.
To the Minister of Human Resources: last year your ministry underspent its family and children's service budget by $8 million. You failed to provide facilities for children like this little boy. The question is: what plans do you have in mind to get children like this little boy out of the mental hospital where yesterday he could have been killed?
HON. MRS. McCARTHY: The member for Maillardville-Coquitlam would like to make a case that the Ministry of Human Resources is placing children in places which are inappropriate for the children. I would like to just say right here and now that that is not our ministry's policy, and any inference that it is, I think, is unbecoming of a former Minister of Human Resources in this province.
First of all, that member, more than any other member, knows full well that a difficult case, such as the one we are speaking of today.... I want to tell you that there is very much behind this case that I am not free, either in this assembly or outside this assembly, at the present time to relate, because it is a very complicated and very difficult case. I am assured by my ministry today, however, that the youngster who was placed in Riverview was placed there for his own protection and for the protection of the place from which he came, that the youngster was in the very best place for his psychotic condition, and that he was in the very best care.
MR. LEVI: That's why he was attacked yesterday.
MR. SPEAKER: Order, please.
HON. MRS. McCARTHY: The members opposite do not wish to accept that from me at the present time. As I say, that is the inference which the opposite side wants to leave with the House in question period, perhaps for its own purposes. What we are interested in on this side of the House — and, I would hope, on both sides of the House — is for the very best treatment for the children concerned. The child's case that I have taken as notice to bring back a report to the House will be brought to the House, but I want to assure the House that I have had a report from my ministry that assures me that the best efforts have been made to make sure that the protection of that child is well taken care of, including the area from which that child has come.
MR. SPEAKER: Hon. members. as an observation, the series of questions with which we have just dealt is perhaps what those who structured the guidelines for questions had in mind when they said questions of an argumentative nature should not be permitted.
Orders of the Day
The House in Committee of Supply; Mr. Davidson in the chair.
ESTIMATES: MINISTRY OF EDUCATION
(continued)
On vote 56: public schools education, $772,622,740.
MR. KING: Mr. Chairman, I have a couple of questions for the minister. As he is undoubtedly aware, a number of investigations have been conducted with respect to the organization of the Shuswap school district at Salmon Arm. I think the B.C. Teachers Federation commissioned an investigation last year. I don't think that report was made public. There was some threatened litigation, should that report be made public. Subsequent to that, however, a report was commissioned by the board itself. That report, which I believe made some nine recommendations for a reorganization of the administrative structure within the school system in that district, has resulted in some fairly spectacular changes being made. I believe there were one dismissal, two resignations and certainly a shake-up with respect to the major senior staff — the superintendents and the other senior offices within the board.
The teachers from the area, who have been expressing a concern for over a year and requesting that the ministry become involved, are expressing further concern, in light of the proposed new reorganization, that the local teachers are in fact being shut out of any role, input or discussion with respect to the reorganization of that school district. While I'm not privy to all of the problems that precipitated the investigations and the recommendations that flowed from those investigations, it would certainly appear on the face of it that partly at the heart of this problem was a lack of a spirit of cooperation and communication between that senior organizational staff and the local school teachers. Certainly. as a representative for the area. I am vitally interested in trying to ensure that there be a cooperative and harmonious relationship for the benefit of education in that area.
I wonder what the minister knows about it. I wonder if he is prepared to use his influence to ensure that there is the broadest possible participation in discussing the mechanics of a new organization and perhaps in ensuring that all local elements of the education spectrum be involved so that in the future we can be sure we're going to have a cooperative vehicle which has a mutual sensitivity and respect for the roles of all the elements of the education system.
It is my understanding that in the final analysis the minister must approve whatever structure the local board adopts, and I would strongly urge upon him that he satisfy himself that there is a better spirit of communication and cooperation than apparently exists now. I offer to the minister my own cooperation in any way. I can perhaps provide a vehicle for convening meetings or bringing together elements of that community to try to provide a cooperative apparatus for the future. I would very much appreciate hearing the minister's views.
HON. MR. SMITH: This member and I did cooperate on a previous occasion to bring about a resolution of a difficult school question in his constituency, and I must say that for some time I've been concerned with what's been going on in this particular area. As he knows, two supervisors' jobs were declared vacant, there were the resignations of the director of instruction and the superintendent, and the position of secretary-treasurer was also terminated. I'm aware of that, and also aware that if new organizational positions are to be created they will require my approval. I will not give that approval until such time as I have monitored exactly what is going on in that district. As I am sure you realize, hon. member, the people whose positions were terminated may wish to request a transfer appeal, which I shall consider. But I think the main thrust of your submission is that there should
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be discussion and cooperation between the board and the teachers concerned. I will endeavour to ensure that it takes place.
MR. KING: I thank the minister for his response. I would appreciate it if the minister would undertake to keep me advised regarding the status of the reorganization so that I might be a party to the kind of development and agreement coming together, before the fact rather than after the fact. I would appreciate that cooperation very much.
HON. MR. SMITH: I would be delighted to do so. I value the member's assistance in these matters.
MRS. DAILLY: I want to express my concern on behalf of the people of Burnaby North, whom I represent, over the increase in the burden on the taxpayers of Burnaby North ever since the Social Credit government came to power, and the continuing increase in the basic mill rate. I don't intend to go into any details on it, because our education critic from Vancouver Centre has already expressed the concern of all NDP members. But I want to go on record as saying that this government has a lot of explaining to do to the people of Burnaby North, and I would hope that the Minister for Municipal Affairs (Hon. Mr. Vander Zalm) doesn't once again attempt to order the councils to say what great people the government are in the handling of their grants.
The other quick point and question I want to bring to the attention of the minister is: I wonder if you could tell me what guidelines now exist for the committees which you have set up, and which we have had for a number of years, I know, to review textbooks that are presented by different publishers around the province. What guidelines do these committees use to decide which textbooks will be approved?
MS. BROWN: I'm not quite sure whether this is the correct vote under which to raise this, so I'm going to seek the guidance of the minister. It has to do with a request from the greater Vancouver area for funding for pre-school children in classes in English as a second language. Is this correct vote under which to raise that issue? Fine.
The statistics that I get from greater Vancouver, which takes in all of Burnaby, New Westminster and surrounding areas, is that the pre-school population is fast approaching 50 percent of the school population, and the research is finding that if English can be taught in the pre-school it really cuts down in terms of the hardship or disability which it is to these children once they get into elementary school and high school. In fact, rather than concentrating on English as a second language in elementary school, they're suggesting we should start funding from pre-school and kindergarten and then through the elementary school system. In fact, by the time some of these students reach elementary school they may not need that additional support in terms of English as a second language.
Has the minister looked at this request? Is the ministry considering preschoolers in a favourable light?
HON. MR. SMITH: I'm going to respond to the member for Burnaby North (Mrs. Dailly) in a moment. I'm not ignoring her question.
The member raises the question of funding pre-school. I think this has probably been a desire and request from many educational elements for some years, probably from before the time of the member for Burnaby North. The implications of it are somewhat horrendous financially.
My own preference would really be, in some pre-school areas where a good case can be made, that we should be moving in with some kind of program assistance. One of those is children who do not have English as their first language. The other is in some of the other special education fields, where a dollar and some time and care invested at this stage would reap some important results. It would allow these children to reach a good level early instead of putting them in the position where they always have to catch up.
So I can tell you that I am looking at limited program assistance areas where I can help preschoolers. One of those is ESL, and the other is certain areas of the disabled. I think we should move there; it's a question of dollars and when. I think the member is on a sound track. I have not yet seen the particular request from the group mentioned in the Vancouver area. It hasn't come onto my desk. I have no policy at present that would allow me to fund it. I only know about it through an article I read in the press recently, and you've mentioned it now.
I think this merits moving into a limited program area for preschoolers, and I think it would be an important move to do that in the field of special education — and I include this in the field of special education, because it legitimately belongs there.
MR. LAUK: Mr. Chairman, I just have some questions given to me to ask the minister during estimates. They came in late, but they're properly under votes 56 and 57. This question is from the B.C. Association for the Mentally Retarded. They called me this morning and asked if I would raise the concerns relating to special education. They want to know if the funding for new programs being obtained is at the expense of existing ones or whether it is new money. Examples given are renovations to the Jericho Hill School and so on. A coordinator for the gifted appointment is planned for this September, I'm told. The question really is: is funding for new programs being obtained at the expense of existing ones or is it new money?
The second question is: how has the minister decided to approach the pre-school needs of disabled children? He alluded to this in the previous answer. At present the ministry has no specific mandate under the School Act, but planning is essential for successful mainstreaming. We would like to support any move the ministry makes to having the School Act set out clearly its responsibilities and the responsibilities of the school districts with respect to pre-school needs of disabled children.
HON. MR. SMITH: Mr. Chairman, in response to the concern of the B.C. Association for the Mentally Retarded, it's definitely new money for Jericho and for the gifted. It's not money we're taking out of another pot. In response to the second point on the pre-school, the only funds at present earmarked for this are a pilot project in which we'll be giving grants for existing programs for pre-school deaf children. There are some funds budgeted for that. We will have to develop funds for the next year if we're going to take any further program initiatives for pre-school children. It's my intention to take moves in that direction, as I indicated to the previous member as well.
MR. LAUK: I take it you'll be answering the queries of the member for Burnaby North.
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The point that I wanted to make was essentially the second part of the question: to me it seems a revision of the School Act has to be done, setting out the responsibilities of the ministry and the school districts with respect to pre-school responsibilities for disabled children. Has the minister decided to do that?
HON. MR. SMITH: Has he decided to do it? I've tried to indicate that my own thrust would be to move in that direction for programs in these categories. I think that should ultimately be reflected in changes in the act. I don't think that I'm precluded from doing that at all in an administrative or funding way, and I wouldn't feel that I was. I certainly agree with the member that there should be a revision in the act which more clearly sets out the responsibilities of the various levels that are involved in education and their duties. I've indicated that that will be in the revision of the School Act. The changes don't have to await the revision. hon. member.
Perhaps I could respond at the same time to the member for Burnaby North. There are textbook guidelines; a process known as EPIE — don't ask me what it means — is a systematic evaluation against the objective of courses. It's done by a professional body consisting of teachers. It's used in this province, in Alberta and in Manitoba. Information is shared among the various provinces. What it does is evaluate the reading level and the suitability of the textbook as it relates to the courses; it also evaluates the materials from a standpoint of racism and sexism. The evaluation is done largely and dominantly by professional teachers, hon. member.
MRS. DAILLY: Part of the reason for asking the question is that I've had some concern expressed by some of the B.C. book publishers — I presume the minister is aware of this — who agree that there should be such a committee but question what the guidelines are. I know that you have a special grant for books published in B.C. to be used for school textbooks. Frankly, the concern is that not enough books published in B.C. are being used in our public schools. I want to ask the minister if he could explain the guidelines a little more clearly so we know if it is anything to do with the guidelines, or lack of money.... What is it?
HON. MR. SMITH: I will endeavour a little later to be more detailed with you about the guidelines. I endorse your sentiments about B.C. book publishers. When the social studies revision is completed, the materials that will be used for the new social studies courses are going to be generated to a large degree — I hope — within this province and will have a western and British Columbia flavour to them, which we have not had often in the past. That is greatly overdue. There is a grant that goes to publishers for books used in the libraries, but it doesn't go beyond that. Just a little later in my estimates, if you'll bear with me, I will try to give you more details of those guidelines.
MR. COCKE: Mr. Chairman, I've been interested particularly in what's been happening at Jericho Hill School. The previous minister got things in such a state of confusion and chaos....
HON. MR. VANDER ZALM: Are you sure you did your research?
MR. COCKE: The Minister of Municipal Affairs and urban transit could do well to go out and buy a streetcar named Desire.
I would commend the minister for at least providing that Jericho is a very important entity. At the same time I'm wondering how the minister is dealing with the fact that the school now has adjacent to it a training program for police. The whole environment there seems to be lacking in support for the need of those people who are in it.
I'd like to bring to the minister a classic case of frustration in the province. There is a woman by the name of Ann Fair in Coquitlam. She has a deaf child who is four and a half years old. As a result of the fact that our society seems to give very little priority to people's needs, what's really happened is that she's had to give up her career, go on social assistance and somehow or other ferry her child around from place to place trying to get help. You can't blame or dump this on any particular minister, and particularly on one who is relatively new. I believe the government's priority has to be one that more closely reflects the needs of people. I think the minister should go over the Ann Fair case, thinking in terms of the kind of support service — if nothing more than transportation — that could be provided. For example, to get her child to a Vancouver centre she gets a one-way trip on a bunny bus. The woman can't afford a car. naturally, and would have to borrow one to go and retrieve her child because the bunny bus doesn't come back until the older kids come back late in the afternoon, but her program ends at noon. This is the kind of unfortunate situation that we have when we are not really looking at the basic needs of people.
I would like the minister to have a word with us about his direction for Jericho Hill School which, incidentally, is a school that I wholeheartedly support in terms of the work that it's done over the year. It's a school that should not have been neglected and thrown into turmoil by the previous minister. It would appear that things are turning, and I would hope that this minister continues his present direction, or at least what I interpret as his present direction.
I'd also like the minister to say a word or two about his ministry or his committee with respect to the International Year of the Disabled. specifically concerning how people such as Mrs. Fair can be fairly dealt with. I don't know whether the minister knows about this specific case. I know of it through a federal colleague of mine, Pauline Hewett, who sent me the information. I received it today. I'd be glad to send the minister a copy of the correspondence and the newspaper article from the Coquitlam area so that he might have someone look into it. I think it's most important that this case and like cases are seen as priorities, particularly this year.
The other day the minister said something in terms of the finance formula being relatively fair and that the ministerial decision around the increases in mill rates had not adversely affected some of the districts. This had to do specifically with the public schools. The Chairman is quite concerned. Does that come under this vote, Mr. Chairman? I think you'll find it does. He indicated that what has happened has been just natural inflation, but that everything was fair and copacetic. I'm interested to see one or two of my colleagues from Vancouver, etc., who are saying: "We're now paying the whole shot." Well, in New Westminster we've been doing that for a couple of years. Other areas with a heavier tax base have been doing it much longer.
[ Page 5650 ]
It strikes me that the problem is that the Ministry of Education have bailed themselves out of a responsibility that was once theirs. Under a former administration the percentage of total education costs for public school education was much higher. The proportion accepted by the provincial government was much higher than it is now. It's pure and simple. There has been a tremendous attrition of governmental support for the public school system in this province. I can't understand how the minister can get up and try to defend their policy. He can defend it if he likes, but it's indefensible. The facts are there before us. What the B.C. School Trustees Association is saying is quite right. The districts are being unfairly dealt with with the policy of this government, and that policy has been continual right from the day this new government took over in 1976.
HON. MR. WATERLAND: In 1975.
MR. COCKE: It took over in 1975, the minister says. What did you do in 1975 beyond going around and blowing your horn for two weeks?
Anyway, Mr. Chairman, that having been said, I would be delighted to hear what the minister has to say with respect to ( 1) the question of what exactly his committee is going to do about people who are handicapped; (2) what he, as the minister responsible, proposes for Jericho, and (3)....
Oh, well, he can't answer my third question with respect to their policy on taxation, but he could answer this on sharing: is it his decision now that he's going to come around with a fair proportion and begin in his next fiscal year, or is he going to carry on with the present government policy?
HON. MR. SMITH: Mr. Chairman, I'm not personally acquainted, hon. member, with the Ann Fair case, but I'll be pleased to look into that and specifically what could be done for her under the international year program. She could, of course, apply for a grant. Grants are not limited to organizations; individuals can apply. The proposition of providing transportation services to deaf pre-school children who are attending Jericho would seem to me to be something that would come within the ambit of the guidelines of the international year committee. She should pursue that, and I will pursue her case, if you'll let me have the letters.
What we're doing at Jericho, very briefly — and the member seems very well informed about Jericho — is that we decided that we would have the decision as to the future of Jericho made by a committee consisting of parents, teachers and representatives of the deaf community, as the member knows. A very distinguished committee met and consulted with and had a lot of correspondence with the deaf community around this province. The result was that they recommended — and I accepted the recommendation — that Jericho should remain as the central resource centre of the province for the hearing-impaired. It will be the centre from which all services to hearing-impaired students and local districts will emanate.
That means, of course, that the facilities at Jericho will have to be improved and that a better separation from the Justice Institute will have to be effected. There is a commitment to do that. Three hundred thousand dollars are committed now for immediate renovations — that will include ramps and elevators — and the residences will be made more home-like. We will have to do more than that. of course; we will have to ensure that there is a separate cafeteria and that there is a complete workable separation from that facility and the Justice Institute. One of the features of that, hon. member, is that the activities of the Justice Institute will have to take into account their neighbours. I feel very strongly about that, and I think the member knows what I'm alluding to. So that commitment has been made.
As part of our policy we will be appointing a provincial director of programs for hearing- and speech-impaired students, and that individual will operate out of Jericho. Although Jericho will remain as the resource centre for the province, I still believe that decentralization for these students in other places also makes sense, and that every student cannot end up at Jericho.
On the finance formula, Mr. Chairman, I think that what has to be borne in mind on these percentages that are being tossed around is that really the basic program is what members and the B.C. school trustees are talking about. I have acknowledged publicly to the trustees that the provincial share in percentage terms of the basic program was reduced this year from 39.7 to 37.5. That is a lesser percentage than was in force in this province some five or six years ago as well, and that percentage reduction certainly does concern school boards.
But I think, hon. member, that what has to be fairly borne in mind is that the percentage the province pays for education as a whole has not declined but has remained largely constant since 1975, and the government has undertaken a number of additional cost responsibilities — 100 percent of the cost of community colleges; the amount of money that is rebated to homeowners under homeowner's grants has risen considerably during those years as well; the amount that the government allots for teachers' pensions, which are paid for provincially, dramatically doubled this year; the amounts of money made available to school districts for capital increased. So you have a pattern of the financing of education as a whole in this province over the period from 1975 to the present remaining roughly at the 65 or 63 percent level, exclusive of universities. If you add on universities, it's roughly the same picture; that is, it's at the 70 or 68 percent level. One year it may be down a percentage or two, another year up a percentage or two, but it's been a relatively constant performance, a very good performance and one to be proud of, because the overall cost of education in this province has doubled in real dollars from the time that the gentlemen and ladies opposite sat on this side. To keep pace with the overall percentage, I think, is a very commendable result.
The result of assessments this year and the result that they've had on the sharing, under the formula for certain districts that have a high assessment base, has been quite sharp and dramatic. I've said it once and I'll say it again until I'm blue in the face: the reduction of the percentage of taxable value on homeowners had a very important cushioning effect on that, but it did not have a sufficiently sharp cushioning effect where you have a sudden dramatic swing in assessments. The school taxation committee, which is now meeting and has been consulting with a number of groups, is going to recommend to me ways to ensure in the future that rapid swings of assessment will not impact in that way.
I assure the hon. member that I do not remain complacent about the method of financing education in this province or about the formula; but the formula, as he knows, operates basically on the principle that school districts that do not have a high assessment base receive the bulk of the provincial grant moneys. and it school district that can raise the amount
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of its basic program entirely or nearly entirely from its own assessment base receives little or none of the grants for school districts that are given. They may receive special grants but they don't receive the general grants in the basic program. That is based on the principle of equalization. It may be said that, while the principle of equalization is a good one, it has resulted in some burdens failing on certain districts with high assessment rates, particularly in times of inflation of assessments. That's the very issue that this committee is addressing and that has to be addressed.
I take it from your remarks and the remarks of the first member that you are not challenging equalization, that you believe in the principle of equalization — at least I hope you do; if you don't believe in the principle of equalization, I'm sure you'll correct me — but you feel that there are inequities in the system. That is precisely what this committee is addressing and what it will make recommendations about to us.
MR. LAUK: We had this debate last week, but the minister continually falls down two flights of stairs every time he gets into the defence of the financing formula. First of all, the appointment of the committee is totally rejected by the opposition party as a smokescreen. The minister knows full well what the inequities of the financial formula are, and so does his deputy minister of education finance. Why should we appoint Mr. Fleming to a committee? That's his job. This smokescreen committee isn't going to do a darn thing to help taxpayers this year. They are getting their notices this year, by the way, for tremendous increases based on assessments on their homes, which is no test of their ability to pay these taxes. That's the inequity.
We ask the minister to fulfil the solemn promise he made when he was a candidate for the Social Credit Party in the riding of Oak Bay. That promise was that he would espouse the recommendations of the McMath report and rectify this terribly unjust taxation system. Because of the political footballing with this financial formula, education in some areas goes begging. When he talks about equalization, that's just playing with words. There's no such thing as equalization. Certainly we'd be in favour of equalization if it existed, but it doesn't. The money paid as an overage on taxation in school districts is paid into consolidated revenue. We're dealing once again with the treasury as a whole. It's nonsense to argue about equalization.
Under vote 56 I have noticed some very serious increases in the budget. For example, under travel expense there is an extra $22,232 over last year; office expense, an extra $138,000 — a 69 percent increase; office furniture and equipment, a 47 percent increase; advertising and publications, another $103,000 added onto the budget under this vote. You know what this money is being spent for. The minister defends himself by saying that the province is paying more and more of the share of education costs. Whose share of education costs? Not the school districts'. Look at the advertising, office expenditures and travel expenditures. Under these votes this government is free-wheeling with the taxpayers' money.
Interjection.
MR. LAUK: The Minister of Municipal Affairs (Hon. Mr. Vander Zalm) says I don't know what I'm talking about. I know he's embarrassed to hear about this. I know he's embarrassed to hear that his colleagues are just shovelling money out of the back of a truck. A few years ago the Minister of Municipal Affairs said: "Go and get a shovel." The trouble is that the member for Oak Bay–Gordon Head (Hon. Mr. Smith) thought he was talking to him. He's got his shovel and he's shovelling money out of the back of a truck — and it's the taxpayers' money. He's spending money like an inebriated sailor.
Look at these increases. So far we've moved $160,000 in cuts, which that side of the House has rejected. It's not money that will go to pay for scholarships, teachers' salaries and schools — the new gymnasium in Fort St. James or the new school that's needed in Fort St. James. Not one penny of what we're asking to be cut from these votes will go for the benefit of public education in this province. We want to cut back money from travel; we want to cut back money for these expensive stuffed-leather office chairs that everybody's buying, and for advertising. Who needs advertising like that picture of the minister in the Snoopy pre-World War II aviator's cap and white scarf getting in the Harvard? Who needs these pictures at taxpayers' expense? He looked like Benny Hill in that photograph, anyway. If I were him I'd ask for my money back — I mean, the taxpayers' money.
Therefore I move that vote 56 be reduced by an amount of $300,336. I ask all hon. members of this committee for once to get on the side of the taxpayer. Give them a break and cut back this vote for these needless expenditures.
MR. CHAIRMAN: The amendment is in order.
Amendment negatived on the following division:
YEAS — 24
Macdonald | Barrett | Howard |
King | Lea | Lauk |
Stupich | Dailly | Cocke |
Nicolson | Hall | Lorimer |
Leggatt | Levi | Sanford |
Gabelmann | D'Arcy | Lockstead |
Barnes | Brown | Barber |
Hanson | Mitchell | Passarell |
NAYS — 27
Waterland | Hyndman | Chabot |
McClelland | Rogers | Smith |
Heinrich | Hewitt | Jordan |
Vander Zalm | Ritchie | Brummet |
Ree | Davidson | Wolfe |
McCarthy | Williams | Gardom |
Curtis | Phillips | Mussallem |
McGeer | Fraser | Nielsen |
Kempf | Davis | Segarty |
An hon. member requested that leave be asked to record the division in the Journals of the House.
Vote 56 approved.
On vote 57: post-secondary education — colleges and provincial institutes, $283,171,542.
MS. BROWN: Mr. Chairman, again I just want to belabour the point which I made about the women's access
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program. The three-year diminishing formula is just not good enough to protect this program which is of such vital importance to mature women who are trying to re-enter the work force and labour market. Also I want to bring specifically to the minister's attention a request from theSun shine Coast women's program. Their letter originally went to Mr. R.J. Carter, the Deputy Minister of Education. They were requesting funding for a women's access program of their own. Normally they would have been covered by Cap College, but as we all know, Cap College is being starved to death. It just does not have the funding to cover an additional program. So they decided to apply directly to the ministry and to bring to the minister's attention the fact that they have tried to put such a program in place. They have been giving re-entry courses, counselling courses and that sort of thing over the last fall semester. They've had 356 participants in the fall program, and 318 to date in the winter and spring program.
This is an isolated community, and the women in this particular area really need the kind of service which is given to them by the women's access program. So they have appealed to the minister directly for $60,000 — not a lot of money, Mr. Chairman — to cover the cost of renting the office they're using and the space they're using for these programs, and to have one co-ordinator and some part-time teachers.
They have received a response saying that there was not sufficient money to cover this, so I'm bringing to the minister himself the appeal from these particular women. If he needs more information on it, I would be very happy to give him my copy of the brief which they submitted to Mr. Carter, as well as the letter they sent to him, to fill him in. The Sunshine Coast women really need this program. That's all I'm trying to say. All they're asking for is $60,000.
HON. MR. SMITH: The member for Burnaby-Edmonds is correct that this is a good program they are planning on the Sunshine Coast, They have been in correspondence with my deputy, and he has advised them to apply through Capilano College because the funding is through the college. There is no direct or separate funding, and that is the route they should take. I should point out that quite apart from being starved, that college's budget allocations are up this year 18.5 percent, or virtually $2 million. I don't accept that argument, but I will certainly look at the three-year plan on the women's access program, and if it is not an adequate period of time to get these programs on a lasting basis where there is a real demand for them, I certainly will review that. As I told her the other day, I want to see these programs built into the budget, and not as titillating, experimental come-and-go programs, but as ones which actually get built into the budget and are lasting, where they are good and there is a demand for them.
MS. BROWN: Just very briefly I want to say I certainly support the minister's desire to have the programs built into the budget, but they're suggesting it's going to take at least five years before that can happen. It won't happen in three years. The Sunshine Coast women have been in touch with Capilano College, and they received a letter from Dean Jardine that stated: "Although the college has a commitment to women's centres it is not financially possible for them to open a new one at this time." They talked about being $100,000 in debt, or something to that effect. This particular program cannot wait. They know the proper channels to go through. They've been through the proper channels, and they've been told there is no funding for it. Now they're using improper channels. They've asked me to raise this with the minister during the consideration of his estimates. Is there a grant or something that can be given to this program? I see the deputy shaking his head. Well, I'm trying.
HON. MR. SMITH: I don't think the channels are improper at all. We will go back and have a look at that, and also discuss it with Capilano.
MR. LAUK: I would like to join with the member for Burnaby-Edmonds on this important aspect of community college education, and argue the overall philosophy which seems to be missing from the ministry and the minister's resolve. The literature and a lot of the material and knowledge we now have are telling us something that I think we should have known, through common sense, for generations that somehow we have to achieve, in one of the greatest governmental structures to achieve the goal, equality of the sexes. Somehow we have to establish values within our society where in reality men and women are equal and are treated equally. It would resolve a great deal of the difficulty we presently experience in the social fabric of North American society. I've made this statement before, and I want to make it again. It can't be emphasized too much. It cuts through, is part of and should influence almost every aspect of the Ministry of Education — textbooks, public education, colleges.... Wherever possible, the minister should even go through red lights — as an emergency vehicle, if you like — and bring about access programs, deal with curriculum, parent schools within the school establishment, and with all those things that will help bring about knowledgeable parents and knowledgeable men and women within families, using as a base equal respect between the sexes in our society.
In answering us when we attack the high level of property taxation, the minister has said — and certainly the Premier has said — that the Social Credit government took over the funding of community colleges from the local taxpayer. One of the problems with taking away that burden is that nobody ever really asked for it. Neither the trustees, the local taxpayers or the NDP opposition wanted to be relieved of that burden, but the minister unilaterally relieves the local taxpayer of that burden. Instead of a revenue-sharing formula where colleges could be jointly funded from property taxpayers and the provincial government, enabling local school districts to have some input into community colleges, vis-à-vis the McMath report, the minister has moved against public policy. He's moved against the general will of the public and taken the responsibility for financing colleges away from the local regions, when in fact what he should do is take more of the provincial responsibility for the basic education program and leave a portion of the local taxpayer's contribution towards colleges so that there is some justification for input on the part of school boards.
What happened when they moved the local taxpayer's responsibility? The minister moves in a very centralist way and takes control. Look at the minister's policy directive dated March 25, 1981. It's extraordinary. What ever happened to local autonomy, I ask? Priorities for expenditure of funds are, says the minister, employment-oriented programs, adult basic education and academic and general education support services. He uses academic and general education as priority number three. Did he have the input of the school
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boards? Not according to my mail. It's only had a month to get in. I suppose that in two months the file I have will be three times the size it is today. School boards were not consulted. Local groups and school faculties have not been consulted; at least they don't believe they have, and that's the important perception. The minister is again using this financial weapon to control colleges, not to have community active colleges but centralized control for education. It's a censorship, if you like, of the kinds of things that will be taught and how they are to be prioritized at the community college level.
We said that that would happen when they brought in the bill doing away with local taxation for community schools. We said it would happen, and the minister said that it wouldn't. A month or two later he said: "Well, we're calling the shots. We're amending the act to put a different number of people on the board. We want government control on the board because we're paying the bill." He said that. It's just a difference in philosophy. From time to time it's helpful to put it on the record in this chamber. The government of the day has a philosophy of central control because they very much fear education at the local level. They very much fear a greater number of people within this province having a good and wide education. They very much fear having the control over that education go to the local level. That fear is expressed because of their futile, conservative attitude towards people. They think that people act in a negative way. They don't trust local government. They don't trust local school boards. They don't trust college boards. They don't trust the local taxpayer. They only trust themselves. They say: "We've got the power. You've got to trust us. We are now the Crown and you must give obeisance to the Crown."
We on this side of the House do not have that philosophy. We believe in decentralization of power. We believe in individuals expressing power. We don't go around the country and say, "Oh, big government control under NDP," as argues the Social Credit Party when they're campaigning in various elections. You'll notice that the only time they argue for individual freedom is when they're arguing for land rights under the Land Commission. That's the only time they say: "Individual freedom against big government control." But every other aspect of life is centralized in one power under this conservative, right-wing Social Credit government.
Interjection.
MR. LAUK: No, fascist is modern. This is a feudal government. Everything they do is feudal. You can tell by the minister, who on his royal tour was more concerned with his girth than with his public duty. He's done very well since. I think that the article in the Kelowna Capital News frightened him into Weight Watchers because he realized that somewhere along the line — noblesse oblige — he has to give his due to the democratic system. That philosophy pervades everything that this government does, and it certainly is expressed under this vote.
The minister answered my friend from Burnaby-Edmonds (Ms. Brown) briefly about the college budgets. I think that if one looks at the letter dated April 30 sent to the deputy minister from Paul Gallagher of Capilano College, one can see that the new allocation to Capilano College is insufficient to maintain existing services. There's an estimate there of a total shortfall of about $290,000, but there's some speculation that it could reach as high as $506,000. Is this gentleman, Paul Gallagher, the principal of Capilano College, one of the radicals out there? Is he a communist? Is he a terrorist?
HON. MR. SMITH: Are you making that charge?
MR. LAUK: Well, what is he? The minister says that there's no problem and that there's enough money in the budget, yet the principal of a college says that it's $290,000 short. Who are we to believe? Both are honourable gentlemen. Is the minister suggesting indirectly that Paul Gallagher is totally irresponsible in writing a letter to the deputy minister outlining this shortfall? Is he saying that Mr. Gallagher shouldn't be the principal of the school, that he doesn't know figures, or what? They both can't be right. I'm suggesting to you that if you look at the background of the principal of Capilano College, you'll see that he's not a hysteric or a radical. All he wants to do is run a good college, but he wants to maintain at least, in this booming economy that we here about from the Socreds all the time.... "It's never been better. There's lots of money and everybody has got jobs. There's milk and honey in the streets. The streets are paved with gold." All the principal of Capilano College wants to do is maintain existing services. He says there's a $290,000 shortfall. The minister says that this guy is all wet; he doesn't know what he's talking about, obviously. Or maybe Paul Gallagher is a spy. Is he a CCF spy? Is he a cloth-capped socialist in disguise? Perhaps the minister could edify us.
The other point I want to make is the disastrous effect of the so-called student-contact- hour formula for calculating college budget allocations. The problems with the student-contact-hour approach are as follows. I count three of them. Maybe the minister can clear this up in my mind.
Firstly, it seems to encourage larger classes of popular studies, rather than some of the more specialized lower enrolment offerings. I think the minister will know full well, being a college lecturer himself, how important it is to have the more specialized lower enrolment offerings. Course decisions should be made by the college on the basis of demand and availability elsewhere. Only then should budget be a factor. Under the student-contact-hour formula the budget becomes the number one consideration, rather than the more rational academic approach.
Secondly. It assumes that all colleges have the same potential for attracting students. That's not what the community college was designed for. It wasn't supply and demand. As I understand it. that's clear in all the reports. It had to meet demographic needs, clearly, but that's not the primary purpose of community colleges. The formula favours colleges in urban areas around the lower mainland at the expense of those in the north. as most of the population is in the lower mainland. When this NDP administration brought in community colleges. the purpose was to bring post-secondary education to outlying districts and not institute a financial formula that would discourage that process.
Thirdly, how did the ministry derive 54 cents per contact hour? Why not 44 cents or $1.49? Under the guise of equity of contribution for all colleges, I suggest the government has chosen an arbitrary figure and essentially instructed the colleges to either hike their tuition fees, cut back on services or face a shortfall in government funding, or all three in some cases.
Mr. Chairman, I have those criticisms to make about the school formula. I think the minister should carefully consider his philosophical position. He is a liberal democrat, not a
[ Page 5654 ]
feudal Tory, in the classical historical and political significance of those terms. Being a liberal democrat full of all of those clichés the liberal democrats have, he should at least pay lip-service to the idea of local autonomy over community colleges. His Edmund Burke.... Well, I won't get into that. I can't help it if the minister is schizophrenic. I think, though, that he should seriously reconsider the direction of control over community colleges. Some local autonomy should be given back to either the school boards or some other form of regional representation other than political hackery.
That leads me to my final point. I'm getting a little bit fed up with the idea of appointing Socred hacks to college boards. I think that they have to be representative. Membership in the Social Credit Party should not be the criterion for going on a community college board. Once you look at some of the appointments made.... By the way, they're couched. They appoint three or four people to a board; two or three of them will be hacks; one or two will be good appointments — in other words, people who have been clearly interested in education and who represent the general will in the community and who will be good at financial control and so on.
I'll run through just a few of them, Mr. Chairman, from the recent announcements going back to February, March and April. There's a Charles Lasser; he's the current president of the Chetwynd Socred association, ex-mayor of Chetwynd and ex-member of the Maple Ridge village council. He's got other credentials. He was recently appointed to the Northern Lights College board. You know him; he's a good friend of yours. He's your campaign manager or something.
Interjection.
MR. LAUK: I know. I don't think membership in a political party should preclude you from going on a college board, but something that obvious....
MR. BRUMMET: Well, that's what you're saying.
MR. LAUK: No. I'm saying when it's something that obvious, why don't you just avoid that kind of thing? He's got enough to do; you know he's going to toe the party line.
MR. BRUMMET: It doesn't make them bad people because they're Socreds.
MR. LAUK: Not necessarily, but prima facie it does. I'm going to have that member thumb his Black's Law Dictionary as I press on.
Here's another one: Janet Edwards. Mrs. Edwards and her husband are in Northland Agency in Fort Nelson. Is that in your riding too? They are listed on the back of Tony Brummet's campaign flyer, it says here, as his constituency contacts in Fort Nelson.
Interjection.
MR. LAUK: If I'm going to call up a college board person up there and ask for a confidential inquiry — which, as a member of this Legislature, I have the right to do — am I going to call Mrs. Edwards?
MR. BRUMMET: Why not? She's well-known and respected in the community.
MR. LAUK: But she's your community rep; she's a partisan politician; she's your ward-heeler in the constituency, and she sits on a community college board. Am I going to call her up on a sensitive issue involving a student? She's going to phone you up right away.
Interjections.
MR. CHAIRMAN: I ask members not to interrupt the member now speaking. If the member who has taken his place in debate would address his comments to the Chair, then we could continue with orderly debate.
MR. LAUK: You're quite right. Well, I'll stop there if it's going to disturb these people. The college boards are being peppered by political hacks, political appointments. I think that's unfortunate. I think the minister should resist the influence of his caucus in the appointment of members to these boards.
I didn't mean to upset the member that badly. He's left; he's very upset. I know he's a frail member. We don't want to upset him.
HON. MR. HEWITT: Bully.
MR. LAUK: Benjamin Bunny's back.
The point I'm trying to make is that if you want the public to feel that the board has integrity and that there is a real interest on the part of the Ministry of Education in seeing that the community colleges are properly run by people who have an interest in education in the area not by those whose primary interest is the political success of their local MLA or candidate, then the minister will take a more realistic view of appointments to these boards. I have a whole list of who they are and how they got on. I think it's really unfortunate. I think it's more widespread under this minister than it has been in the past. I think that he should look carefully at his reputation, because a Minister of Education, insofar as appointments to boards are concerned, is much like the Attorney-General with judicial appointments, although there is perhaps a higher responsibility with the Attorney-General. It seems to me that the people who are the custodians of our post-secondary education in outlying areas have just as much of a responsible judicial function as a judge, that those appointments should be considered with great care, and that they should not be open to any public criticism because of partisan politics in the appointment of these individuals.
Those are the broad, general points and some specific points that I have to make under this vote.
HON. MR. SMITH: I'm quite interested to hear that member's remarks about the advisability of having these community colleges not funded provincially but by going back to some form of local taxation or local support for them.
MR. LAUK: That's not what I said.
HON. MR. SMITH: Yes, you did.
MR. LAUK: You're twisting it.
MR. CHAIRMAN: Order. Hon. member, you cannot interrupt the minister that way.
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HON. MR. SMITH: You and I, Mr. Chairman, sat in local government at the time the community college system came into being, when the levy of 2 mills was placed on local property taxes in most communities. I certainly can remember that at that time everyone in local government was virtually unanimous, whether they were school boards or municipalities, that they wanted that 2 mill levy removed. In fact, I also recall that the B.C. School Trustees Association — which the member always quotes in this House when it's to his advantage — urged very strongly that this be done. And it was done. To suggest that we now go back to a form of local funding would not, I think, have a great deal of local support; but it's an idea.
MR. LAUK: Local autonomy.
HON. MR. SMITH: There has to be provincial, public and community responsibility as well, hon. member. One of the problems with your speech and your remarks about the control of post-secondary education is this: the system of funding colleges and institutes in this province is not a highly centralized system out of Victoria; it's a very decentralized system through three councils which essentially make the allocations that end up being the budgets of the colleges. Many recommendations were made to me during the past year that I should abolish the three councils and create one council. Those recommendations, interestingly enough, were made to me by colleges — the boards, administrations and principals of colleges.
MR. LAUK: What difference does it make?
HON. MR. SMITH: Well, it would be a move in the direction of centralization.
MR. LAUK: Not really. You appoint all of the councils anyway.
MR. CHAIRMAN: Order, please. The minister has taken his place and is speaking.
HON. MR. SMITH: In any event. there is a balance in the post-secondary system between the powers of the ministry, the very, very strong allocation powers of the three councils and the decision-making of the local board. The local board still consists of a number of school trustees, and close to half of these boards are made up of elected school trustees — in some cases it's even more than half, because ministerial appointments are not always filled.
Hon. member, you talked about appointments to college boards, and one of the problems, quite frankly. Is trying to find people to serve on college boards. and to serve in a representative way geographically throughout a college region. It is not an easy task to find....
MR. LAUK: We'll find you names.
HON. MR. SMITH: Well, I can't remember ever having a list from you.
MR. LAUK: Well, would you like some?
HON. MR. SMITH: Well, are you offering?
MR. LAUK: Surely.
HON. MR. SMITH: I may have had some names from that member, and I think I've also had some assistance in that regard from the member for Shuswap-Revelstoke (Mr. King). But it is difficult to find people to serve who are representative geographically of a region as well. and appointments to those boards take a great deal of time. I know that appointments to Camosun College were certainly made on the basis of community service and a diversity of background and interests, and they were not made on the basis of membership in a particular party.
MR. LAUK: That was just coincidental.
HON. MR. SMITH: Oh, that happens to be an area that I'm familiar with. but it's difficult to become that familiar with the people available in every region of this province. I have found from my experience that, by and large, the people who are appointed to these boards — either by their school boards or by the ministry — serve in a community sense and in a responsible sense, and they do that almost without question.
The member raised the question of the budget for Capilano and invited me to get into a debate with the principal of that college, who isn't here. It is certainly true that a number of community colleges. when they speak of shortfalls and cutbacks, feel that the budget allocations that came to them through the council system were not high enough. But when I give you those figures of the Capilano budget rising from $10.1 million to $12 million — a rise of 18.5 percent — that can hardly be considered a cutback. It is true that the administration believes they will be about $290,000 short on the operating side. But it is going to be the case with colleges that priorities of programs have to be adjusted, that programs are not there forever and that in order to meet new community or vocational needs, some existing programs may have to be modified. We are reviewing the Capilano budget and some other budgets where there are difficulties. In Capilano there was a very high inflation rate of some 16.3 percent on salary, which had to be taken into account.
Hon. member, you also mentioned to me the basis of the student-contact-hour formula — how we had arrived at the 54 cents per student-contact-hour as the basis of a policy, which was to cover in guidelines non-governmental revenues that went to colleges. Well. that 54 cent figure was based on an average throughout the system, and it was assumed that that would be phased in over a period of years — that there would be a one-year period of discussion and implementation. It by no means follows from that policy either that tuition fees are the sole way in which a college can find that amount of non-governmental money; there are other avenues open to colleges and institutes to find revenue, and some of them are exploring these. It is also true that the percentage of the cost of the operation of colleges and institutes in this province that is paid for by student fees is very low indeed. I believe that overall it's approximately 7 percent, and that sits very well in comparison with other jurisdictions in other public institutions.
MR. HANSON: Mr. Chairman, I have a couple of specific questions to the Minister of Education regarding asbestos. At Pacific Vocational Institute, could you advise us what steps you've taken to...? I understand you may be moving out of that building. Would the minister respond?
[ Page 5656 ]
HON. MR. SMITH: Mr. Chairman, I will in a moment, so that I'll be up to date.
MR. HANSON: While the minister is getting the response on Pacific Vocational Institute, would he also advise the House if there are any other colleges in the province where the WCB has undertaken testing of the airborne asbestos fibres? The contention on this side of the House is that we play the numbers game with particle size and the number of fibres, and although we realize it's a long-standing problem, there really shouldn't be exposure for students or staff to any airborne fibres.
HON. MR. SMITH: Very briefly at this time, the welding building you're speaking of at PVI is going to be vacated. At the present we are not aware of other buildings where the WCB has indicated a similar asbestos danger.
MR. HANSON: If the Ministry of Education is to vacate that building and it is to be demolished, the contractors who are going to demolish it should be advised to take precautions for the adjacent community. In other words, I think oftentimes these buildings are knocked down, freeing all that asbestos insulation into the ambient air in the neighbourhood. I think if you would make a note now that in the event that your officials decide to vacate the premises and to have it destroyed, that aspect should be done in conjunction with the WCB.
HON. MR. SMITH: Yes, we will do that, and do so with some warning and in conjunction with the WCB.
MR. LAUK: The question which arose this morning as a result of my conversation with the B.C. Association for the Mentally Retarded with respect to post-secondary education was the status of funding of disabled young adults in community colleges. I am advised that the funding has been set aside, which I understand to mean that it may show up in the budget. But I don't know where to find it here, and perhaps the minister can point it out in the budget. If it's been set aside and not yet allocated, I'm concerned it will eventually be siphoned off into something else. On the record, I wonder if the minister can indicate the sum, which vote it's in, and how we know it's going to be used.
HON. MR. SMITH: I think that's a timely question. There is $800,000 in the budget which is unallocated for that purpose, and we will be allocating it for adult disabled programs. I hope to be able to advise the Legislature of the nature of those programs very shortly. We're working on the development of them. There is money in the budget, and it will be allocated, and I know that organization is interested.
MR. LAUK: Where is it?
HON. MR. SMITH: It's under our ministry's standing committee (ABE and continuing education). In the $18 million-plus, there's an amount in there of $800,000 which is for initiatives in the the area in which that organization is particularly interested.
MR. LAUK: I thank the hon. minister. But even going through post-secondary education, I find that the minister's unreasonable, profligate directions are taking their expression. He is using the taxpayers' money again in areas not required through demands on the public education system in the post-secondary education system. I will point out to the minister that under vote 57 there's a 21 percent increase in travel expense, a 66 percent increase in office expense and a 95 percent increase in office furniture expense. Now what are these people doing? Are they getting sunken bathtubs, or what's happening? Why is this money being spent in this profligate and wasteful manner? These are hard-earned taxpayers' dollars. I promise to keep it within these four walls; I won't tell a soul outside of this room how much money this minister is just throwing against the wall.
I therefore move that vote 57 be reduced by an amount of $82,709.
MR. CHAIRMAN: The amendment is in order.
Amendment negatived on the following division:
YEAS — 24
Macdonald | Barrett | Howard |
King | Lea | Lauk |
Stupich | Dailly | Cocke |
Nicolson | Hall | Lorimer |
Leggatt | Levi | Sanford |
Gabelmann | Skelly | D'Arcy |
Barnes | Brown | Barber |
Hanson | Mitchell | Passarell |
NAYS — 27
Waterland | Hyndman | Chabot |
McClelland | Rogers | Smith |
Heinrich | Hewitt | Jordan |
Vander Zalm | Ritchie | Brummet |
Ree | Davidson | Wolfe |
McCarthy | Williams | Gardom |
Curtis | Phillips | McGeer |
Fraser | Nielsen | Kempf |
Davis | Segarty | Mussallem |
An hon. member requested that leave be asked to record the division in the Journals of the House.
Vote 57 approved.
On vote 58: post-secondary student aid programs, $6,285,218.
MR. LAUK: You'd think that under vote 57, the opposition would have no cause to find fault with the government and that whatever money is voted for students the opposition would support.
Under this vote, it's true that predominantly the money goes for grants, contributions and subsidies to students. That's something like $15 million. We're happy that the ministry has made innovations and changes that will better aid students. They're not all that we asked for, but the ministry has gone a long way. But why does it increase its travel, office and furniture expenses again under the same vote?
[Mr. Davidson in the chair]
[ Page 5657 ]
Here is a worthwhile vote, and yet there is a 20 percent increase in travel, a 46 percent increase in office expense and, once again, a 60 percent increase in office furniture. The man who makes genuine leather stuffed chairs in this province must be making a fortune; or they're imported. Are they Venetian? There's an increase of $19,075 over last year on those items.
I therefore move that vote 58 be reduced by an amount of $19,075. I urge all hon. members to support that amendment.
MR. CHAIRMAN: The amendment appears to be in order.
Amendment negatived on the following division:
YEAS — 24
Macdonald | Barrett | Howard |
King | Lea | Lauk |
Stupich | Dailly | Cocke |
Nicolson | Hall | Lorimer |
Leggatt | Levi | Sanford |
Gabelmann | Skelly | D'Arcy |
Barnes | Brown | Barber |
Hanson | Mitchell | Passarell |
NAYS — 27
Waterland | Hyndman | Chabot |
McClelland | Rogers | Smith |
Heinrich | Hewitt | Jordan |
Vander Zalm | Ritchie | Brummet |
Ree | Wolfe | McCarthy |
Williams | Gardom | Curtis |
Phillips | McGeer | Fraser |
Nielsen | Kempf | Davis |
Strachan | Segarty | Mussallem |
An hon. member requested that leave be asked to record the division in the Journals of the House.
Vote 58 approved.
On vote 59: Teachers' Pension Fund. $83,700,000.
MR. NICOLSON: Mr. Chairman. I think these votes should not go by without some comment on the government's rather arbitrary action and the distaste that it stills leaves in the mouths of teachers across this province, I don't normally attend functions such as the B.C. teachers' annual general meeting or the B.C. school trustees' annual meeting. but I did have occasion to attend a professional development symposium in Vancouver about two and a half weeks ago. In the conversation afterwards it was very obvious that last year's unilateral action by the government with respect to teachers' pensions and pensions in general was certainly....
HON. MR. VANDER ZALM: On a point of order, Mr. Chairman, just for clarification, could you advise me if since we're discussing the vote on teachers' pensions there may not be a conflict of interest with respect to the member for Nelson-Creston (Mr. Nicolson)?
MR. CHAIRMAN: The member for Nelson-Creston has the floor on vote 59. and I'm sure he's aware that under these particular votes we do not discuss legislation. the need for it or otherwise.
MR. NICOLSON: No. We don't talk about legislation passed in this session either. Mr. Chairman.
I'd like to say that this has had, and is having, a lasting deleterious effect upon the educational climate in this province. I must say that I and, I'm sure, almost every member of this House has had communication by way of letter or petition from probably every teacher in his riding. It isn't just the notion of capped COLA. but the whole way in which these funds are invested.
This year I note the amount is up. It appears to be nearly double what it was last year. But of course if one looks at the interim expenditures one sees that last year the government exceeded estimates by some considerable amount. so a great deal of what we see in the estimates this year is just a reflection of bringing things into line with reality. Indeed, this amount we see before us may or may not get spent. It may be put into Teachers' Pension Fund, and it may partially find its way into surplus.
One of the things I'd like to talk about in terms of this fund is the manner in which these moneys and this money wc're voting here today is invested. For instance, I note that the recent prospectus of the British Columbia Hydro and Power Authority.... Those funds were invested nominally at 4.5 percent and 5 percent in bonds. But when one looks at the proceeds and realizes that the proceeds were not 100 percent — that in one case the proceeds were only 98.8 percent. and in another 98.5 percent — we see that the rate of return to the foreign bond holders is really 15.7 percent. In other words. the government is willing to pay 15.7 percent and 16.5 percent to get bonds from a foreign source which are subject to fluctuation in dollar amounts in terms of the way in which we repay them.
How is the government actually going about investment? Its record over the past several years has not been good, and I would submit that the government, rather than go to foreign bond markets. should utilize these funds and go to the foreign bond markets to set a market rate.
What the Minister of Finance (Hon. Mr. Curtis) has really ended up paying is 15.7 percent and 16.5 percent for two bond issues. whereas they were passed off on the public as being 14.5 percent and 15 percent. When these funds are invested — I see the minister is getting advice from the Minister of Finance — should they not be invested at the going rates? Maybe they should have gone to B.C. Hydro as these funds have done in the past. They should not go at some nominal rate, should they not realize what the government is willing to pay in terms of going to a bond market.... I can remember the Minister of Intergovernmental Relations (Hon. Mr. Gardom), along with Mr. Brousson years ago talking about Mike Popell and the business of discounting. Here the government is going and getting discounted mortgages. It's advertising that it's getting 14.5 percent and 15 percent bonds when in fact it's getting 15.7 percent and 16.5 percent.
Does the minister not feel that it would be a fair policy for investment to test the New York market for part of the requirements, but then to raise other types of capital and to put pension funds into outfits like B.C. Hydro at the market rates that are established on the international market. rather than by something that's a little bit local and doggone dirt cheap toward government?
[ Page 5658 ]
The other thing I would like to say, Mr. Chairman, is that the principle of capped COLA is simply an admission of failure by government to deal with inflation. There would be no need for a government to be concerned about cost of living if governments were coping with inflation. All that any organized group is asking for if they want a cost-of-living adjustment to pensions — whether it be senior citizens on Canada Pension, the straight guaranteed income supplement, teachers' pensions, civic workers' pensions, government employees or people in the private sector — is simply that something be done about inflation. If you want to solve the problem by bringing inflation to a grinding halt and a zero inflation rate so that their pension will put the same amount of groceries on the table this year as it will next year and in successive years, that's all they're asking for. They want a truly fixed income so that you can buy the same amount of goods once you've retired in your sixty-fifth year as you will then be able to buy in your seventy-fifth year. They're not even asking to take a proportion of the increase in the gross provincial and gross national products.
The minister has had a great deal of time to reflect upon this. He's had meetings. I would ask the minister if he does not consider the action taken to date with pensions to have been a very unfair target area in which to try to cut expenditures. What you're really going to do is reduce income year by year. When a person is 65 and retired, he's going to be okay. When he's 70, he's going to be considerably worse off. You can solve any concerns that you have about the rate at which pensions might grow by coping with inflation. You are government, and you have the ability to do that if anyone does, federally and provincially.
The two questions are: does the minister not consider that they have chosen an unfair target group when they picked not on teachers but on pensioners in order to cut costs? You don't get a pension when you're still teaching. You get a pension after you've retired. Also, would it not be fairer to look at the kind of return that we are willing to pay to foreign bond holders? What we're really paying — I'm not saying they're necessarily receiving it — is 15.7 percent and 16.5 percent on those bonds that only yielded proceeds of 98.5 cents and 98.8 cents on the dollar. That's the rate of return we're willing to pay to somebody else. We wouldn't have to pay fees to Salomon Bros., First Boston Inc. and others who place the bond offering in the United States if we were to do a very closed sort of things in terms of meeting the needs of B.C. Hydro out of these pensions and then fixing these rates. We would also not have to worry about what's going to happen to the Canadian dollar vis-à-vis the American dollar. Does the minister not think that it would be a fairer policy to set the market by subscribing some of our bond needs for Crown corporations in that free competitive market in the United States, and also to take up that same rate of return by investing the Teachers' Pension Fund in that manner?
HON. MR. SMITH: As the member knows, I am not in charge of investment policies or the administration of the Teachers' Pension Fund. However, I'll do my best with those questions '
No, I do not feel that the pensioners were singled out as a group. In fact, the provisions that were made — the new money that was voted for teachers' pensions this last year — was a very major improvement, as you know, in the basic funding of the Teachers' Pension Fund. Indeed. the government did meet all the requests originally made at the time by the B.C. Teachers Federation and the superannuation commissioner. The subsequent history of that is well known. A change in view on indexing occurred. The changes in legislation took place after that time. I went around on my tour this fall, and I heard a great deal of concern about the subject of indexing.
Fortunately, as you mentioned, the investment yield of that fund this year is much more promising. I'm also pleased that the teachers are going to participate on the investment advisory committee, as they have been invited to do for the past year. Presently a joint study has been undertaken on behalf of the federation and the government to try to discover ways of improving the investment yield of the fund. I hope that will produce some fruitful results. Hon. member, I'm also advised by the minister that the new funds invested under this plan are at market value.
MR. MACDONALD: There are a lot of teachers who have had bad luck in terms of the pension system. They taught in earlier years and are now retired; they might have been in an elementary school and not have had the various academic qualifications that give a higher salary bracket in the modern system, whether or not you are a better teacher. A lot of teachers are on a pension that is very penurious at the present time. Yet the indexing of pensions is not in a dollar amount, as everybody knows; it's in a percentage amount. The percentage applied to a low pension, on which somebody is struggling to survive, is the same applied to somebody who gets a bigger return from the same percentage. So the gap between those who are reasonably well off under a pension and those who are very badly off increases. Both of them, say in 1981, need another $500 to look after the rises in the cost of living.
I wish the minister would look at that. I know it prevails throughout all sections of society. This percentage thing is very invidious in terms of not helping those who may be equally deserving, because they've been earning at a lower base. Perhaps the minister would look at that. I think he understands the problem.
HON. MR. SMITH: Some favourable changes for retired teachers were made in the alterations that took place this past year, but I will take into account what you have said, hon. member.
Vote 59 approved.
Vote 60: advances re rural school taxes, net, $10 — approved.
On vote 61: independent schools, $12,664,657.
MRS. DAILLY: During past debates on independent schools, I recall that some very interesting debate took place. There was one point made by some members on this side of the House to the former Minister of Education, who brought in this bill on independent schools. It was the concern felt not only by some members of the opposition — most of them, I believe — but also by some members in the independent schools who were concerned that once they received grants perhaps they could lose some of their independence. As a matter of fact, some schools have refused to accept grants because of this fear. Now, the thing I find rather interesting is that when the present Minister of Education has been asked
[ Page 5659 ]
about increases in grants to independent schools from the present grant, his answer to the independent school people has been: "What about your independence?" I'm just asking the government if there has been some change here, because the former minister who brought in the bill did not seem to be concerned. He just sort of dismissed some concerns expressed here about the correlation between public funding and independence. I wonder if the present Minister of Education in charge of this matter now could tell the House at what level of financing he feels that independence would be lost.
HON. MR. SMITH: That's really argumentative and problematic because you can lose independence, I suppose, at 30 percent or you can lose more independence at 50 percent. The question to be addressed is: at what stage does your dependence become such on operating grants that the vitality of raising money that your school may have from other sources is simply not there? You become a kind of duplicate of the public school system. I don't think that the independent schools of this province wish to do that. I think they wish to retain vitality, energy and independence of their own. They see the School Support (Independent) Act as providing them with support but not dependence. Striking that balance is not easy, but that is the balance that we have at present. Apart from the fact that they are under an inspector of independent schools and that they conform to the administrative handbook, guidelines and curriculum of this province, the independent schools do enjoy a high degree of independence. I would perceive that continuing.
MRS. DAILLY: I have just one follow-up question. Do I understand the minister correctly, then, that there will be no basic change in the formula to give more aid to independent schools in this province because of his fear of erosion of independence?
HON. MR. SMITH: There will be no change this year, hon. member, in that percentage. As you realize, it yields more dollars; as the cost of educating a child in the public school system increases then the grant increases on that formula basis. There are no plans this year to increase the maximum of 30 percent.
Vote 61 approved.
On vote 62: International Year of Disabled Persons, $2,839,750.
MR. HANSON: I have just a few specific remarks about my own constituency under this vote. If we were trying to outline in general terms what the needs would be for access for disabled people — particularly in this year — to the educational institutions under this minister's responsibility, one would say that we need access in terms of ramps and elevators. We need adequate wash-room facilities and ways in which people can get from one level in a building to another. I have looked at the Camosun College situation and I've also looked at some of the schools in Victoria. This $2.8 million, spread over the various responsibilities of the minister, isn't going to buy very many ramps or elevators or renovate very many wash-room facilities for handicapped people. I was wondering if the minister could advise me and the other members on this side of the House how that $2.8 million is apportioned and what significant quantum and qualitative change it is making in giving access to handicapped people in British Columbia.
HON. MR. SMITH: The granting of that money does not envisage that it is going to be used to make classrooms accessible in schools and colleges. That is really not within the criteria, because that is provided for now in educational policy. In any new construction, it's required that they are accessible and that there are provisions made for the disabled. There is also capital funding encouragement to upgrade them. So I don't think you can look to that $2.8 million being used where there is already public policy and money available for this; I think you have to look to the committee to allocate that money to do something that isn't being met by some public program or a program of a ministry. The guidelines are very general, but one of the guidelines certainly is public accessibility.
I could see, for instance, the committee recommending grants for transportation to bring disabled people into an educational post-secondary institution, which was an example that was raised earlier. I could see a number of programs and projects being funded. One of the criteria that the committee is going to use in the funding, as I understand it, is that they are going to be looking for programs that can be ongoing and not be one shot. I don’t think. though. that the problems of physically restructuring the old Camosun building — the old Young building — and some of the schools are going to come out of this money. They're going to have to come out of ministry moneys as part of ministry initiatives. There are going to be a number of ministry initiatives to provide access for the disabled during this year. but it won't come out of that special fund.
MR. HANSON: Mr. Chairman, I understand that at Camosun many of the plans for renovation hinge on the acquisition of the Paul building. Could you advise me on what the current state of that acquisition is? Is it possible for it to be speeded up? Are there contractual obligations that are slowing it down?
HON. MR. SMITH: Well, quite honestly, that matter has concerned me for some time. I have had correspondence with the school board on the matter, and I understand that concrete steps are finally underway to vacate it. It is expected that within six months that will be complete. I can't give you hard and definite dates; those dates seem to change. There is no doubt whatsoever that it's going to put some strain on the space requirements of Camosun come September — it was always planned earlier that that vacation would take place in time for September. But I think now the school board has finally recognized that they are going to move and relocate and that that building will be available at Camosun, and it's now negotiating the actual timing and phasing of that. But I have exactly the same concern that you do, and I really didn't sit by and just not deal with it; I made constant inquiries and I have written to the board about this. I will continue to be interested in it, and I will be glad to communicate directly with you on it at any time.
MS. BROWN: Mr. Chairman. I just want to say a few words about this minister's role as the chairperson for the International Year of the Disabled, and to remind him and everyone else that we went through an International Year of the Child in this province, and at the end of it the children
[ Page 5660 ]
were worse off than they were before. I want to say that I really hope that we're not going to have a repeat of that situation now. I was very glad when he was chosen to head up this committee, because one of the things that disabled people have always told us is that they don't want to be covered by the Ministry of Human Resources, because they are not interested in charity. What they want is skill training, job training and re-education and, of course, accessibility to buildings and these kinds of things, as my colleague the second member for Victoria (Mr. Hanson) just said.
I'm hoping that at the end of this year, in fact, the life of disabled people in this province will have been enriched as a result of this minister being chairperson of this particular committee; that, in fact, the integration of disabled children into the schools will be accompanied by the services which will make that integration run smoothly and make it a happy experience for those children rather than a traumatic one, and not make them a burden on the school system and on the teachers. Also, I'm hoping he will address himself to the kinds of skill training and job training that disabled people need and that can be financed through his ministry, as well as looking at other areas such as accessibility and speaking to the Minister of Labour (Hon. Mr. Heinrich) about the request that the disabled community are making to be covered by the Human Rights Code. Those are the kinds of issues that they're asking for, as I mentioned earlier — the kind of consciousness-raising which has to take place in the curriculum used in the schools as well as in teacher training and with the teachers themselves. It's a very big task this minister has taken on, and I certainly hope that he'll be able to rise to the occasion, because we're really looking forward to your doing a good job this year.
Vote 62 approved.
On vote 63: building occupancy charges, $2,581,000.
MR. LAUK: Mr. Chairman, really, an increase of $201,000 for building occupancy charges! What are these people doing over there? I ask you in all seriousness. Here we are, overtaxing local taxpayers out of their homes — you're destroying home ownership in the province. Local taxpayers are supporting the basic education program in most school districts, without a penny coming from the provincial government.
Interjection.
MR. LAUK: Well, that's true in a lot of school districts. With an increase of over S201,000 in one year, I therefore move that vote 63 be reduced by an amount of $201,000.
MR. CHAIRMAN: The amendment appears to be in order.
Amendment negatived on the following division:
YEAS — 23
Macdonald | Barrett | Howard |
King | Lea | Lauk |
Stupich | Dailly | Cocke |
Nicolson | Hall | Leggatt |
Levi | Sanford | Gabelmann |
Skelly | D'Arcy | Barnes |
Brown | Barber | Hanson |
Mitchell | Passarell |
NAYS — 27
Waterland | Hyndman | Chabot |
McClelland | Rogers | Smith |
Heinrich | Hewitt | Jordan |
Vander Zalm | Ritchie | Brummet |
Ree | Wolfe | McCarthy |
Williams | Gardom | Curtis |
Phillips | McGeer | Fraser |
Nielsen | Kempf | Davis |
Strachan | Segarty | Mussallem |
Vote 63 approved.
On vote 64: computer and consulting charges, $1, 576, 854.
MR. LAUK: Mr. Chairman, looking at this vote has caused me a great deal of....
Interjections.
MR. LAUK:
Could I have the committee's undivided attention? Before the Minister
of Finance (Hon. Mr. Curtis) goes, I wonder if he would just bear with
me for a moment. I want to show him something. It's a book that I have
available in my office. In this book is catalogued, chapter and verse,
the overspending of the government under the tutelage of that Minister
of Finance. There is a graph on one page of this book indicating the
tremendous amount of money that we've asked for in spending cuts. Look
at that. I'm willing to table this book with the House. Do you want
copies? Have you got copies? Copies will be available to every member
of the House. It catalogues the overspending of this government:
Forests, $12 million; Universities, Science and Communications,
$458,000...
MR. CHAIRMAN: Order, please, hon. member. We're on vote 64, computer and consulting charges.
MR. LAUK: I'm just getting to that.
MR. CHAIRMAN: You're not even on the ministry, hon. member.
MR. LAUK: ...Municipal Affairs, $368,000; Tourism, $2 million; Agriculture and Food, $1.7 million; and on it goes. So far, after I move this amendment, in Education.....
HON. MR. CHABOT: Send it to Kamloops.
MR. LAUK: Isn't that arrogance, Mr. Chairman? Notice the arrogance of that hon. member for Columbia River (Hon. Mr. Chabot). I'll tell you where we're going to send this, Mr. Chairman, through you to the minister: to Columbia River. And they'll want to know the millions and millions of dollars that you and your profligate government have been shovelling out the back of a truck. I'll tell you that the hundreds of thousands of dollars that are being spent in that member's riding to shore him up won't work.
Interjection.
[ Page 5661 ]
MR. LAUK: What did you say? The minister is chewing gum and I didn't quite hear what he was saying.
Under this vote, Mr. Chairman, for computer and consulting charges, we have an increase of $116,804. I move that vote 64 be reduced by that amount.
On the amendment.
MR. NICOLSON: Mr. Chairman, I thought that it would be only fair to inform particularly government members that on the face of things this might look like a reduction but, in fact, this allows for a very generous increase. We know that the government is making an unnecessary change from a Honeywell to an IBM computer; they're going to have to rewrite their software and they'll be nine months behind in certain departments in even getting this thing. So we might as well save money and not even vote anything for computer and consulting charges because they won't be getting any information back for most of this year. In spite of that, we are allowing for a very generous increase, because last year in this House we voted $1,460,050, and yet in the first ten months of that fiscal year, we had spent only $812,839. In other words, if we were to continue spending at that rate, we could spend maybe another $80,000 to bring us up to about $900,000, and then we could allow another $100,000 just to cover contingencies that might come in at the end of the year. That would allow for $1 million. We still would have an overestimate of $460,000 — in other words, almost half a million dollars. Last year's estimate was probably out something in the order of 50 percent, depending where you take the base — 331/3 percent taken the other way.
Here is an area where we probably will see half a million dollars going into general revenue, being squirrelled away.... Indeed if it were in order I would move that the amendment be amended by adding an asterisk after this figure saying that it is expected this expenditure will squirrel away half a million dollars, and that it will go to build Gracie's Pier B-C, whether it's on Burrard Inlet or in False Creek — wherever or if ever it may happen to be built. That's what this is really about. So we're allowing for a lot of things in this vote. We're allowing for the really legitimate computer needs of this ministry to go ahead. We got an extra amount in there by voting only to reduce it to last year's figure. There's room for growth, and even room for us to squirrel away a little bit of money to build Pier B-C. A wink is as good as a nod, and I'll say no more about that, Mr. Chairman. You know what I'm referring to.
So the opposition has an ironclad case. Yes, you can participate with us on this vote. You can support us in this reduction and we can at least show an example of some fiscal responsibility by reducing one of these votes, because this vote as it is presently constituted allows for almost everything that is needed. It also allows for things not needed. If the backbench members of the government don't show some concern over this, then it shows that they haven't really examined the interim accounts of the ministry, or that they haven't really asked any questions. It shows they aren't interested in fiscal responsibility but only in buying their way back into government with big-ticket projects, and they believe this is the way that it's done.
So, for all of the people of British Columbia, we can stand and be counted on this amendment. I certainly support this very responsible and very timely amendment.
MR. LAUK: Due to the many, many requests from members on the opposite side, I wish to say that so far the NDP has proposed over $24 million in spending cuts.
MR. CHAIRMAN: The question is a reduction in vote 64 by an amount of $116,804.
Amendment negatived on the following division:
YEAS — 21
Macdonald | Howard | King |
Lea | Lauk | Stupich |
Dailly | Cocke | Nicolson |
Hall | Leggatt | Levi |
Sanford | Gabelmann | Skelly |
D'Arcy | Brown | Barber |
Hanson | Mitchell | Passarell |
NAYS — 27
Waterland | Hyndman | Chabot |
McClelland | Rogers | Smith |
Heinrich | Hewitt | Jordan |
Vander Zalm | Ritchie | Brummet |
Ree | Wolfe | McCarthy |
Williams | Gardom | Curtis |
Phillips | McGeer | Fraser |
Nielsen | Kempf | Davis |
Strachan | Segarty | Mussallem |
An hon. member requested that leave be asked to record the division in the Journals of the House.
Vote 64 approved.
The House resumed; Mr. Speaker in the chair.
The committee, having reported resolutions, was granted leave to sit again.
Divisions in committee ordered to be recorded in the Journals of the House.
HON. MR. GARDOM: Public bills and orders, Mr. Speaker. Second reading of Bill 13.
FINANCE STATUTES AMENDMENT ACT. 1981
HON. MR. CURTIS: Mr. Speaker, in moving second reading of Bill 13, which is one of several bills introduced on budget day in March, I would make the observation that members of the House might more appropriately discuss those sections or points contained in the bill in the committee stage, inasmuch as — I will say it before members opposite do — this is not an unprincipled bill, but it is a bill with no main theme running through it. Therefore I would suggest, sir, that under the rules of the House second reading would be somewhat difficult. If that is acceptable I would, therefore, move second reading of Bill 13.
MR. STUPICH: Certainly. as far as the minister went, I can accept what he said, but I don't agree that it has no main theme running through it. Certainly the main theme of this
[ Page 5662 ]
legislation is to increase government revenue — in almost every section of the bill it does increase government revenue. We can speculate as to what the government is going to do with that money. We'll do that at another time. Eventually we may even get to the minister's estimates. At that time we'll perhaps hear more about that.
The main theme is not only to increase government revenue in every section of the bill before us, but in many of the sections it heaps gasoline upon the fire of inflation by indexing most of these revenue increases. So to the extent that it is designed solely to get more money out of individual taxpayers — not only to get more money out of them, but to index the rate at which that money is being taken from taxpayers' pockets and thereby to feed the fires of inflation — the opposition will vote against this legislation.
MR. COCKE: I would just like to make one comment on the whole question of indexing. The government is very slowly, but surely, taking away from the Legislature the responsibility of responsible legislators in the future. When a revenue source is indexed the governments of the future don't have to make any kind of hard decisions. What they do is just refer us back. For example, it was last year that we indexed medicare premiums. So from now on, forever and a day, as the costs increase the government can stand back and sort of be regarded as watching it at arm's length. They're making a decision now that carries into the future until heaven only knows when.
It strikes me that a responsible kind of government is a government that comes back with a new determination each session. If they feel in the next session that, because of inflation and other reasons, an increase is in the cards, fine, let them debate it at that time. But this is a grave concern, and it has permeated the kind of legislative process that we've seen. For example, we see so little legislation coming in here, by virtue of the fact that so many of the decisions have either been made and are ones that we will carry on with or are decisions that have been taken right away from the Legislature and moved into the cabinet chambers. I don't think it's healthy for our province to be placed in the position it is in. I go right along with the member for Nanaimo (Mr. Stupich), who suggests that there's no possible way we can support this kind of legislation.
MR. NICOLSON: I too rise to oppose this. While it's a very lengthy bill and does have many housekeeping aspects to it, the general tone of this bill and some of the provisions are going to have counter-productive effects in terms of the area I represent in the Kootenays, which is part of the area that aims toward an Alberta market, and the whole attitude toward taxation which prevails in the province of Alberta. Those are the people we have to deal with and attract into our area. We have to jingle some change out of their pockets if they're going to do more than just come driving through looking at the fine scenery. The minister certainly hasn't even begun to address himself to that kind of problem. So when we get to the appropriate sections I'll certainly have more to say on this bill, but I think what this bill is saying is that after several years of Social Credit government they have failed. They have only one solution for the fiscal management of this province, and that is to increase taxes. Increase, increase, increase. I'm very pleased to say that I will be voting against this bill.
MR. HANSON: Along with the member for Nanaimo and other members on this side of the House, I would also like the record to note that when a bill is introduced with so many different sections, it really does inhibit a proper debate in this House on the entire bill. I draw your attention to section 33. Section 33 in this bill increases the borrowing power of B.C. Hydro by $800 million, by deleting three words. Given B.C. Hydro's policies, the importance of a proper, well planned energy program for the province and the fact that the borrowing of Hydro is with us for many ensuing generations....
MR. SPEAKER: Order, please, hon. member. The debate upon which the member is now embarking is the kind of debate which would be in order in committee.
Interjection.
MR. SPEAKER: Order, please. A passing comment as an example would be all right, but to enter into debate on a section would not be in order.
MR. HANSON: Thank you, Mr. Speaker. I'm attempting to highlight that when a bill like this comes before us, as the minister pointed out, following that thread through the bill we find small items like this that really merit a full debate. An increase of $800 million on Hydro's borrowing power certainly warrants a separate debate.
MS. BROWN: I just wanted to speak very briefly on this bill. I notice that in the budget speech the government promised that the homeowner grant of $630, which is presently open only to handicapped people in receipt of GAIN, was going to be extended to cover all handicapped people in the province. I just want to say that I'm hoping that, when the regulations for the bill come down, we don't find the regulations are so restricted that the intent of the promise made in the budget speech is not carried out by the bill. When we get into debating it section by section, I will certainly speak in more detail on this — when we come to sections 23 to 25, dealing specifically with it.
In an overall kind of statement about the bill, I'm just saying to the minister that the intent of the bill, which was to extend the $630 to all disabled people in the province, is, I think, a very good one. It had the support of members of the opposition. I certainly hope that having sections dealing with that in the bill does not mean that the intent is somehow going to disappear when we see the regulations dealing with this particular act.
HON. MR. CURTIS: Mr. Speaker, two or three specifics have been referred to which I earnestly believe are better dealt with in the committee stage, where members opposite, including the hon. second member for Victoria (Mr. Hanson), know that there can be full debate on a particular section which is of interest to hon. members of this House.
I suppose that it's a little difficult for the official opposition.... I'm surprised to hear that they are voting against this bill in second reading, particularly when one looks at some of the benefits flowing out of this bill. Again, I will save my remarks for committee debate. But in voting against second reading. the official opposition is also indicating that it does not approve of the expansion of the eligibility for handicapped or disabled persons. That is one of the sections.
[ Page 5663 ]
An omnibus bill is not unknown in this chamber, Mr. Speaker. Indeed, omnibus bills have been a fact of life in this chamber for a good number of years. I think there can be extensive debate at the committee stage, as I indicated in my opening remarks. I move second reading of Bill 13.
Motion approved on the following division:
YEAS — 27
Waterland | Hyndman | Chabot |
McClelland | Rogers | Smith |
Heinrich | Hewitt | Jordan |
Vander Zalm | Ritchie | Brummet |
Ree | Davidson | Wolfe |
McCarthy | Williams | Gardom |
Curtis | Phillips | McGeer |
Fraser | Kempf | Davis |
Strachan | Segarty | Mussallem |
NAYS — 21
Macdonald | Barrett | Howard |
King | Lea | Lauk |
Stupich | Dailly | Cocke |
Nicolson | Leggatt | Levi |
Sanford | Gabelmann | Skelly |
D'Arcy | Brown | Barber |
Hanson | Mitchell | Passarell |
Division ordered to be recorded in the Journals of the House.
Bill 13, Finance Statutes Amendment Act, 1981, 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. GARDOM: Second reading of Bill 10, Mr. Speaker.
INCOME TAX AMENDMENT ACT, 1981
HON. MR. CURTIS: Mr. Speaker, in the March budget speech for the 1981-82 fiscal year, I announced several major changes that will affect British Columbia personal and corporation income taxes in the 1981 tax year. These changes are contained in the bill before us, Income Tax Amendment Act, 1981. Perhaps I could touch on a few of the main points which are contained in the bill. One provision is for the new provincial personal income tax credit for the full year of 1981 and subsequent tax years. The credit will be equal to 3 percent of the tax-filer's personal exemptions less 1.5 percent of the tax-filer's personal income.
Mr. Speaker, you will note that I've used the term tax-filer, and not taxpayer. This is a very important distinction and one that has been generally overlooked in the commentary immediately following the budget this year. The word tax-filer is used because the tax credit is fully refundable. Therefore many British Columbians who do not pay income tax, such as students and senior citizens with low incomes, will still be eligible to receive the full amount of the credit in the form of a cash refund from the government. To claim the credit, all they shall have to do is file a 1981 tax return.
I'd like to point out that the basic amount of the credit will be 3 percent of the tax-filer's personal exemptions. This formula has been used, instead of a fixed-dollar amount, for two reasons. First, the formula will target more benefits to those tax-filers claiming more dependents, as well as to the elderly, so those most in need will receive more under this formula. For example: the maximum credit for a single tax-filer will be $95; for a single pensioner it will be $155; for a married tax-filer it will be $178; for a married tax-filer with two children under 18 years of age it will be $214; for a married tax-filer with four children under 18 it will be $246; and for married pensioners it will be $235.
The second reason we've chosen this formula is that personal exemptions are, as hon. members know, indexed under the Income Tax Act. Therefore, if inflation continues to increase in future years, the level of benefits under the tax credit will also increase proportionately without any further legislative action being required. The basic credit will, of course, be reduced by 1.5 percent of the tax-filer's personal income, so that if the tax-filer has no taxable income, he or she will receive the full basic credit; however, as income rises, the tax credit is designed to phase out. To illustrate the importance of this new tax credit, I would like to point out that the credit will not be reduced to zero until certain income levels are reached: for a single tax-filer approximately $10,500, for a single pensioner approximately $16,500, for a married tax-filer about $18,500, for a married pensioner approximately $24,000 and for a married tax-filer with two children under 18 approximately $22,500.
Mr. Speaker, it's estimated that at least 40 percent of all British Columbia families and 75 percent of the elderly will benefit from this credit. In this tax year — and again I should like to stress that the credit is fully refundable — those paying no income tax may claim the full amount of the credit by simply filing their own income tax return. If the credit is greater than provincial income tax otherwise payable, the difference will be refunded to the taxpayer. All British Columbia residents 16 years of age or over and who are not claimed as a dependent by another tax-filer are eligible to claim the credit, again starting with the 1981 tax year. I would like to point out that while the credit will not have an effect on 1981-82 provincial tax revenue, 1982-83 provincial personal income tax revenue will be reduced by approximately $70 million.
On a per capita basis, Mr. Speaker, this represents one of the most generous tax credits in Canada today. Together with the renter's tax credit and low-income tax reduction introduced in previous budgets, approximately $100 million of income tax relief will be provided to low- and moderate-income individuals and families during the 1981 tax year. This will help to offset increases in other costs which these individuals are facing.
Another section of the act, Mr. Speaker, imposes a 10 percent surtax on high-income British Columbia taxpayers for the full 1981 year and subsequent taxation years. The 10 percent surtax will be calculated on provincial personal income tax payable in excess of $3,500. A brief example may assist hon. members to clearly understand how this provision is to work. For example, a British Columbia taxpayer may have a gross income of $43,000 during 1981. After subtracting all the exemptions and deductions allowed him or her under the Income Tax Act, that person may have a taxable income of $36,000. If so, that taxpayer would normally pay $3,830 in provincial tax. However, the amount of provincial
[ Page 5664 ]
tax payable in excess of $3,500 — in this case $330 — will now be subject to the 10 percent surtax. As a result, the British Columbia taxpayer will have to pay an additional $33 of provincial income tax in the 1981 taxation year.
I should also point out that while the surtax is applicable for the full 1981 tax year, deductions from source, for those of us who pay as we receive the money, will not commence until July 1, 1981, in accordance with the federal-provincial tax collection agreements.
In my earlier remarks, I spoke about the significant number of people who will be assisted by the income tax credit. Now we're speaking of the surcharge on high-income earners. It's expected to affect only the highest 49,000 earners in the province during 1981, or approximately 3 percent of all British Columbia tax-filers. Nonetheless, it's a fundamental ingredient in the package of revenue measures which was structured on the principle of ability to pay and which I detailed at length on March 9 of this year.
There are other details which I think would move into committee stage. However, I would like to observe that this bill also increases the British Columbia corporation income tax rate from 15 percent to 16 percent for all corporation income earned after December 31, 1980.
I believe it's only fair that all sectors of the British Columbia economy bear a portion of the increases in taxes necessary to produce the balanced budget which we voted on earlier. So while the general corporation income tax rate was increased, the tax rate applicable to small business corporations was reduced from 10 percent to 8 percent for all small business corporation income earned after December 31, 1980. I would point out that this is the second successive reduction in the small business tax rate by this government.
In the 1980 provincial budget we reduced this rate from 12 percent to 10 percent. Now, at 8 percent, British Columbia has the second lowest tax rate for small business in all of Canada. It is second only to Alberta's. It's estimated that about 50,000 small businesses throughout the province will benefit and are benefiting now from this tax reduction. This tax relief is particularly valuable and important since small businesses are a very important segment of our business and commercial activity. It's proposed that the new general and small business corporation income tax rates apply to all corporation income earned after December 31 last. Corporation income earned prior to that date will be taxed at the prebudget tax rates.
Finally, the bill provides for a simplified definition of "tax payable." It is a technical amendment. It has no budgetary implications. The change simply aligns British Columbia's definition with the definition used by other provinces participating in the federal-provincial tax collection agreements.
No one likes to pay taxes. What we have attempted to do with Bill 10 is spread the burden as evenly and equitably as possible. I believe that we have achieved that. I believe that the small business rate reduction, the low-income tax credit and the higher-income tax surcharge are designed to take us towards that equality which this government seeks.
I move second reading of Bill 10.
MR. STUPICH: The minister, in closing second reading of the previous bill, suggested that the opposition would have some trouble with it because there was one section that pretended to give some money back. But even in that section the government was going to raise more money than it was giving back. So every single section in the previous bill did raise more money, and it was not hard for us to make that decision.
Interjection.
MR. STUPICH: I'm reflecting on a vote, yes, but this is my first opportunity to speak after the minister closed debate on the previous bill. What I want to do is tie it in with this one, because here we are.
We do have a dilemma here, because this bill does give and take. It takes more than it gives, but because it does take from those who can afford it best and professes to give to those who need it most we will support the legislation before us.
But I would like to make a comment about the effect of it. Reading the budget speech, I think it's perhaps significant that the increase in personal tax to be paid by the high-income people is going to reflect increased money for the government in the 1981-82 fiscal period. The increase in the corporation tax for the larger corporations is going to bring more money in in the 1981-82 fiscal period. The reduction in corporation tax for the smaller companies is going to reflect lower income for the government in the 1981-82 fiscal period. But the part of the bill that gives more money back to the lower income tax filers doesn't affect government revenue until the 1982-83 fiscal period. So when it starts giving the money back to individuals, that takes longer to come into effect, which makes me have a little bit of concern about another bill.
If the minister wants a reference, I'm reading the budget speech, page 44, where it shows the effect of the....
HON. MR. CURTIS: Good speech.
MR. STUPICH: Pardon me? I wanted you to have an opportunity to say it louder for Hansard.
In any case, the government taking money away wants it right away, and when it's going to give it back to individuals it says you can wait and get it back at some later date. Of course, we have some concern about what's going to happen at that later date. Maybe I can reflect on something that took place in a previous session when the government did lower a particular tax — perhaps we'll be discussing that later today — and promised at that time that never again would it be raised. Today we will be discussing the government changing its mind in rather short order. In saying that it's going to give money back to tax-filers the government is putting it far enough into the future that it might very well change its mind about that too. I hope not. I like the principle of taking more money from those who are in the higher tax brackets and giving it to those in the lower tax brackets.
In spite of what the minister said about the help that it's giving small business I'm a little bit concerned. The Income Tax Act was arranged theoretically, and hopefully to some extent, that people who own small businesses would pay as close as possible the same amount of income tax whether they took their money out of the company in the form of salary and wages or dividends. When we start mucking about with those various rates of tax we disturb that relationship. By reducing the tax on the smaller corporations to 8 percent, what we are saying to the people who own small businesses is that you, who already have certain advantages in the income tax legislation that are not available to individuals, can claim expenses
[ Page 5665 ]
and deductions that the ordinary individual receiving salary or wages can't claim. In addition to having those advantages, we're going to give you one more advantage. You can jiggle or juggle, if you like....
SOME HON. MEMBERS: Oh, oh!
MR. STUPICH: You can juggle the salary, wages and dividends you take out of your company. The net effect will be that the receiver-general will get less money, if you play the rules the way they're written. To that extent I don't support the reduction in taxes to the small corporation, because it is disturbing the relationship that was intended to make it fair to taxpayers generally. I hear the groans across the way. I've stated my position and that's the way I feel about it. But I have said that the opposition will be supporting his legislation because it does, further down the road, offer to give money back to the tax-filers who need it most.
HON. MR. CURTIS: Mr. Speaker, I think that some of my colleagues on this side of the House will want to speak in committee stage on Bill 10, but it is interesting to hear that the finance critic for the NDP in British Columbia is opposed to a reduction in the small business income tax rate. For whatever reasons he later describes, the fact remains that it is there and it has been said today in second reading of this bill. We won't tell many people, just British Columbians, about that particular position.
I dealt at length in my opening remarks with respect to what we attempted to achieve. The equity is there. I trust that this government never finds it necessary to reduce the income tax credit which I spoke about in March and again today in the legislation. The fact is that some of us are in a better position to carry the burden of government than others. That was the principle behind the discussions which led to the legislation, and that is the principle of this Social Credit Party. I move second reading.
Motion approved unanimously on a division.
Bill 10, Income Tax Amendment Act, 1981, read a second time and referred to a Committee of the Whole House for consideration at the next sitting after today.
HON. MR. GARDOM: Second reading of Bill 12, Mr. Speaker.
SOCIAL SERVICE TAX
AMENDMENT ACT, 1981
HON. MR. CURTIS: Mr. Speaker, the budget proposed several changes to the Social Service Tax Act in British Columbia. Some of these are primarily intended to increase provincial revenues — and there was no attempt to walk away or move away from that necessity. Others are intended to promote energy conservation and to make the collection of the social service tax more equitable. Another change is intended to assist in defining and interpreting the act; those sections will be dealt with at committee stage, I would think, Mr. Speaker.
We have one portion of the bill which is to enable taxation of certain machinery and equipment classed as fixtures. when the machinery owned by a manufacturing business is resold. In recent years production machinery attached to the realty has been considered part of the realty if the assets of the business were resold as an operating business. As the Social Service Tax Act applied only to purchases of tangible personal property, machinery used in manufacturing attached to realty and acquired as part of an operating business could not be taxed at the time of purchase, but if the equipment had been purchased new or detached from real property, social service tax was therefore due. The amendment contained in this bill therefore enables a consistent approach to be taken in taxation of such assets.
The rate of the social service tax itself has changed from 4 percent to 6 percent effective budget day last March. Mr. Speaker, I dealt at length then with the fact that this is necessary to compensate for the major decline in natural resource revenues which we are currently experiencing. Our stated commitment has been to reduce neither the quality nor the quantity of provincial government services provided to British Columbians. In the face of this commitment, there was no choice for the government but to seek an increase in taxation revenues, of which those provided by the social service tax form a very large part, The new tax rate is still lower than in six other provinces within Canada. While the higher rate somewhat increases the taxation impact on British Columbians, the new provincial personal income tax credit I spoke of earlier will either remove or greatly ease this burden for low- and moderate-income families and the elderly. The tax contains a number of exemptions in order to ease the burden on those who have moderate or low incomes. I'd also like to point out that nearly one-half of this tax increase is to be paid by businesses within the province.
We also deal with a variable sales tax rate on the purchase of new automobiles. This was first introduced in the 1980 budget and was intended to encourage the purchase of more fuel-efficient automobiles. In keeping with the general increase in social service tax, the variable rate for automobiles has been increased accordingly. Members will see the details of that laid before them.
I'm proposing another amendment in this bill. It concerns the tax that is payable by all persons where tangible personal property is acquired initially without payment of social service tax, but is later used by the purchaser for his own use. Some recent court decisions have made it necessary to clarify the intent of the government in this area. This will make it clear to all purchasers that tax would be payable in such situations — as when tangible personal property is taken out of resale inventory for use by the business itself, or when tangible personal property is brought into the province in the course of carrying on a business, or when untaxed tangible personal property is used in the course of carrying out a service contract.
Another section will modify the exemption of fuel oil from the social service tax. As of midnight March 9, fuel oil was to be taxable at the social service tax rate of 6 percent for commercial use.
I spoke about the exemptions under social service tax, and that exemption list is increasing year by year. One that is particularly important, I think, is the removal of tax from yard goods and patterns used for clothing. This removes an inequity, in that yard goods purchased to make children's clothing were previously subject to tax, whereas the actual ready-made children's clothing was exempt. We examined doing it only for children's clothing material, but clearly that would not have worked. Therefore we broadened it to cover all material and patterns of this nature.
[ Page 5666 ]
I think that the balance of the points contained in this particular bill are more correctly under committee, because they change from one particular point of taxation regime to another.
I therefore move second reading of Bill 12.
MR. STUPICH: The minister went a little further in his opening remarks than I had expected he would. A number of members on this side of the House would like to speak. I'd like to move adjournment until the next sitting.
Motion approved.
Hon. Mr. Gardom moved adjournment of the House.
Motion approved.
The House adjourned at 5:59 p.m.