[ Page 8163 ]

CONTENTS

Routine Proceedings

Land Amendment Act, 1982 (Bill 54). Hon. Mr. Chabot

Introduction and first reading –– 8163

Oral Questions

Forest industry layoffs. Mr. King –– 8163

Mortgage foreclosures. Mr. Gabelmann –– 8163

Photographs of Energy minister. Mr. Lea –– 8163

Mr. Barrett

Cutbacks in health care. Mr. Cocke –– 8164

CNIB residence replacement. Mr. Gabelmann –– 8164

Use of government aircraft. Mr. Passarell –– 8164

Inquest into Clifford Olson case. Mr. Macdonald –– 8165

Home Purchase Assistance Amendment Act –– 1982 (Bill 46). Second reading.

(Hon. Mr. Chabot)

Mr. Barber (continued) –– 8165

Mr. Gabelmann –– 8166

Hon. Mr. Chabot –– 8166

Municipal Amendment Act (No –– 2), 1982 (Bill 49). Second reading.

(Hon. Mr. Vander Zalm)

Hon. Mr. Vander Zalm –– 8167

Mr. Barber –– 8167

Hon. Mrs. McCarthy –– 8169

Mr. Howard –– 8170

Hon. Mr. Vander Zalm –– 8171

Waste Management Act (Bill 52). Second reading. (Hon. Mr. Rogers)

Hon. Mr. Rogers –– 8172

Mr. Skelly –– 8173

Hon. Mr. Rogers –– 8176

Division –– 8177

Committee of Supply: Ministry of Forests estimates. (Hon. Mr. Waterland)

On vote 42: minister's office –– 8177

Hon. Mr. Waterland

Mr. King

Mr. Lockstead

MONDAY, JUNE 14, 1982

The House met at 2 p.m.

Prayers

MR. STRACHAN: Mr. Speaker, on behalf of the Minister of Labour (Hon. Mr. Heinrich) and myself, I take great pleasure introducing a group of students who have come down from Prince George for Operation Trackshoes. If theHouse will permit it, I'd like to read their names, because they are special people. The students from Harwin Junior Secondary School are Cheryl Tymko, Shelley Dunn, Brenda Kelly, Stephanie Dix, Dean Cotts, Rachel Baptiste, Coral Watters, Desma Romanin, Michael Berube, Leanza Daniel, Leverne Auger and Darlene Heavysides. Their chaperones are Marjorie UIrquhart, Emma Bulmer, Dorothy Allen, Fran Miki, Jean Lunden and Lorna Burgart. I'd like the House to give these special students and their chaperones a very special welcome.

MR. MITCHELL: Mr. Speaker, I'd like the House to join me in welcoming three people who are visiting the House today. They are Linda Hoon, who is the power behind the president of the NDP in the Esquimalt–Port Renfrew riding; her mother, Avis Linberg; and her aunt, Jenny Linberg, who are both from Sorrento.

HON. MR. VANDER ZALM: Mr. Speaker, in the precinct today, and hopefully with us a little later, is a group of 31 grade 7 students from the Cloverdale Catholic School. On behalf of myself and the second member for Surrey (Mr. Hall), I would ask everyone here to extend a welcome to them,

HON. MR. PHILLIPS: Mr. Speaker, I have two special guests in the gallery today. With my wife Joan is her friend visiting from Sidney, Australia, Colleen Bryant, and I hope that the House will give then, a warm welcome.

Introduction of Bills

LAND AMENDMENT ACT, 1982

Hon. Mr. Chabot presented a message from His Honour the Lieutenant-Governor: a bill intituled Land Amendment Act, 1982.

Bill 554 introduced read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Oral Questions

FOREST INDUSTRY LAYOFFS

MR. KING: Speaker, a question to the Minister of Intergovernmental Relations (Hon. Mr. Gardom) or the minister acting on his behalf. Has the minister decided to refer to the Select Standing Committee on Environment and Resources the subject matter relating to the critical depression in the B.C. forest industry so that that committee might convene mectings and offer some assistance to our depressed forest industry?

If there's confusion on the government's side as to who might be responsible, I direct the question to the acting government House Leader, the hon. Attorney General.

HON. MR. WILLIAMS: Mr. Speaker, I'll be happy to take the question as notice.

MORTGAGE FORECLOSURES

MR. GABELMANN: Mr. Speaker, a question to the Minister of Lands, Parks and Housing. Is the minister ready today, after several weeks of doing apparently nothing — and a reminder again on Thursday — to tell the House the full extent of the mortgage foreclosure problem and what steps he has decided to take to help people keep their homes?

HON. MR. CHABOT: Mr. Speaker, First of all. that member makes a false statement in his preamble to the question, suggesting that I am doing nothing in respect to the very complex question that he asked me. I want to assure him that the question was put to me approximately two weeks ago, and I am attempting to secure the information that he has requested. It's not that easy to acquire that information. I hope to have an answer for the House within the next two or three days.

MR. SPEAKER: I would ask the hon. minister whether or not he was attributing any improper motive to the member.

HON. MR. CHABOT: No, I certainly wasn't, Mr. Speaker.

MR. SPEAKER: Thank you. That's all we need.

PHOTOGRAPHS OF ENERGY MINISTER

MR. LEA: To the Minister of Energy. Mr. Speaker, within the Ministry of Tourism is a branch set up to take photographs of MLAs and ministers for official use. Can the Minister of Energy recall bypassing that service and going outside government service to have his photograph taken?

HON. MR. McCLELLAND: I can't recall such an occurrence. It's possible. I'll check it out, and I'll be happy to bring the proofs back to the member at some later date.

MR. LEA: Has the minister ever heard of Miss Kate Williams of Victoria?

HON. MR. McCLELLAND: I don't recall the name. Mr. Speaker.

MR. LEA: I have in front of me a sheet of paper. On this sheet of paper it says: "audit control 384280.'' It is not a photocopy, but has been copied from a transcript of a voucher from government service. This voucher indicates that the minister went outside the government service to a Miss Kate Williams of 107 Beechwood Ave., Victoria, and had 500 pictures of himself taken at a cost of S2,853, Can the minister recall that?

HON. MR. McCLELLAND: First of all, I'm not aware of any directive which describes how government pictures get taken. I'd be quite surprised if there were such a directive. Secondly. we get requests in the office, almost daily, for copies of pictures — I suppose all ministers get them to be included in programs, news releases and a number of other places. I'd be very happy to come back and have a very

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exhaustive list for the member of where our pictures have been sent at the request of various people around.

Interjections.

MR. SPEAKER: Order, please, hon. members. I assume that when we ask a question, we wish to hear the answer.

MR. LEA: Can the minister explain why, in his opinion, the official government photographers who take these publicity photos for all of us were not good enough? What is it that isn't good enough about that service that the minister had to go outside of government to have pictures of himself taken to the tune of almost $3,000?

MR. BARRETT: On a supplementary to the minister, when the minister ordered the photographs to be taken of him, did he inquire as to how much it would cost the taxpayers to have these photographs done for the minister?

HON. MR. McCLELLAND: I have taken the question as notice. It is very unlikely that I would have ordered the photographs personally.

Interjections.

MR. SPEAKER: Order, hon. members.

HON. MR. McCLELLAND: It is obvious that they don't want the answers to the questions, so forget it.

MR. LEA: While the minister is looking into the questions asked, I wonder if he would also bring back to the House the reasons why it was necessary to have pictures taken of ministerial assistants with himself, because the voucher says: "photographs of minister and assistants." I also think it would be beneficial for us and the public to know what the pictures were used for and why the minister found it necessary to go outside of government service, and spend over $2,800 to have pictures taken of himself, some of which included him and his executive assistant, I guess. Would he endeavour to bring those reasons back to the House?

HON. MR. McCLELLAND: Yes.

Interjection.

MR. SPEAKER: Would the Leader of the Opposition please come to order.

CUTBACKS IN HEALTH CARE

MR. COCKE: This is a question for the Minister of Health. People everywhere in the province are concerned, as we know, about the government's cutback in health care. There are long waiting lists for admission into hospitals and so on. The people in Quesnel are worried and are talking about large user fees, as people are elsewhere. The people in Dawson Creek, however, have decided to do something about this crisis. They are encouraging people to wear a red ribbon as a symbol of their protest to the cutbacks in health care. Has the minister decided what he is going to do to stop the chaos in health care in this province'?

HON. MR. NIELSEN: It could be that people are simply wearing the appropriate colour of their political stripe. I don't know the circumstances.

MR. COCKE: Mr. Speaker, that was an interesting reply from a minister who really doesn't care about his particular obligations. In Dawson Creek we don't find that much support for any party other than the Minister of Industry....

MR. SPEAKER: Order, please. No debate, hon. member.

MR. COCKE: I ask the Minister of Industry and Small Business Development why he is not wearing, in support of his constituents, the same red ribbon he was sent in the mail last Friday.

HON. MR. PHILLIPS: Well, I was very interested, Mr. Speaker, to have the critic for the socialists opposite ask questions about health care in Dawson Creek. Maybe I could inform that member that I am quite capable of looking after all the problems in my constituency. I've had the opportunity and the honour of doing so for a number of years, and I look forward to doing so for a number of years in the future.

I have had meetings with the hospital board; they have attended here in Victoria. Certainly it was very interesting for me to find out that the Dawson Creek Hospital last year had been running at 69 percent occupancy and that the board and the medical profession there had seen fit to almost close the hospital for a couple of months during the summer, and it didn't seem to be any great crisis. However, Mr. Speaker, I would like to inform the member for New Westminster that I am concerned about the health of my constituents; that's why I was so pleased not too long ago to open a new long-term care hospital in Pouce Coupe, which was built under the long-term care hospital program of this government — something they talked about and never implemented. We will be having further meetings, Mr. Speaker, with the people who attend to the health of that area, and I'm talking to the Minister of Health. If necessary, we'll send a special team there to work with the hospital board and with the medical profession in that area. But I'd like to inform the member that I'm quite capable of looking after my own constituents.

CNIB RESIDENCE REPLACEMENT

MR. GABELMANN: Mr. Speaker, I have a question to the Minister of Lands, Parks and Housing. Has the minister decided to assist in the funding of construction of an alternative housing facility to replace the CNIB residence at 35th and Main in Vancouver?

HON. MR. CHABOT: Your substitute does a better job than you. I'll have to take that question as notice, but I don't believe I've had any such request.

USE OF GOVERNMENT AIRCRAFT

MR. PASSARELL: To the Minister of Transportation and Highways, have any B.C. government aircraft travelled outside Canada since January 1, 1982, and if so, will the minister provide all the details?

HON. MR. FRASER: I'm not sure, but I believe they have, and I'll give you the details.

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INQUEST INTO CLIFFORD OLSON CASE

MR. MACDONALD: To the Attorney-General, relating to the victims of Clifford Olson, on May 14 the Attorney-General wrote to the Minister of Municipal Affairs (Hon. Mr. Vander Zalm): "I have no authority to direct him" — that's the coroner — "to hold an inquest, and it would be entirely inappropriate for me to interfere with him in the exercise of his quasi-judicial responsibilities." My question to the Attorney-General is: in the light of section 24 of the Coroners Act, which does allow the Attorney-General to direct an inquest — that's the open one, not just an inquiry — why did the Attorney General write that misleading letter to his ministerial colleague, and why was there no open public inquest and not just an inquiry into these victims of that terrible crime?

HON. MR. WILLIAMS: Mr. Speaker, it was not a misleading response to the member. The decision with respect to the conduct of affairs with respect to the Olson victims was made by the chief coroner in the manner in which similar matters are dealt with when they have become the subject of criminal prosecutions and trials.

Orders of the Day

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

Leave granted.

HON. MR. GARDOM: Mr. Speaker, I call adjourned debate on second reading of Bill 46.

HOME PURCHASE ASSISTANCE
AMENDMENT ACT, 1982

(continued)

MR. BARBER: Mr. Speaker, as you will recall, I rose on Friday as the designated speaker on this bill. During the course of that debate I indicated that we had obtained, through the sheriff's office at the court registry in Vancouver, foreclosure figures indicating the rate of personal and business bankruptcies in this province. I want to make it clear to the House that the figures I was quoting were cumulative and not single, and that the figures as of June 8 of this year — totalling, if I recall, 1,403 foreclosures — were, in fact, a record unprecedented in British Columbia since the time of the Great Depression.

I indicated to the House as well that the official opposition will support this bill, and we do so because it does a little for a few. This is better than nothing for anyone. It does a little for a few, and for that much we are grateful. What it does not do is address the real, structural problem. and it does not use the power and authority of the province of British Columbia, at its own initiative, to bring down interest rates on behalf of homeowners in this province.

As I mentioned on Friday, we made four positive proposals to this administration. I will reiterate them briefly.

First, we ask for the immediate proclamation of the Savings and Trust Corporation of British Columbia Act. Secondly, we ask the minister to consult with his colleagues....

HON. MR. CHABOT: On a point of order, the member is repeating the arguments that he put forward in the House on Friday, which were completely out of order at that time and which are completely out of order at this time. My point is that this bill, which has a minor amendment to the Home Purchase Assistance Act, is narrow in scope. Essentially, it allows the minister to reduce interest rates on second mortgages...

MR. BARBER: That's not a point of order. You're debating the bill.

HON. MR. CHABOT: ...to a select group of people who qualify under the Home Purchase Assistance Act. It has nothing to do with the B.C. savings and trust organization, with HCBC, family collapse or people coming from the wrong side of the tracks.

I suggest, Mr. Speaker, that the member remain relevant in his debate on this minor amendment.

MR. SPEAKER: Thank you, hon. minister.

Hon. members. the debate on second reading must be held to within the scope of the principle of the bill itself. Although passing references can be made to related subjects, certainly a debate on those related subjects is not in order. As I was understanding it, the member was merely recapping by title those things to which he had referred. If he strays too far I will seek to guide him.

MR. BARBER: Thank you. Mr. Speaker.

Continuing, in order, we first of all ask that the government immediately proclaim the Savings and Trust Corporation of British Columbia Act. Secondly, we asked the minister to consult with his colleagues, provincially and nationally, to ensure that the principle of this bill, which is to reduce interest rates by a little for a few, will be enunciated as a national policy at the earliest opportunity. Thirdly, we ask the government to give serious consideration to and make legitimate study of the proposals made by the chief executive officer of MacMillan Bloedel, Mr. Knudsen, who, in addressing the same question of lowering interest rates, last week said that unless the national government acts within 90 days to bring down interest rates to the level of variously 8 or 10 percent, we face genuine economic collapse in Canada. We ask the government to give us their view of Mr. Knudsen's recommendations and to consider the urgency of that. Fourthly, and finally, we ask the government as well to recognize that the housing industry, which will be benefited to some small extent by this amendment — not nearly enough but better than nothing — is one of the fundamental engines of the economy of British Columbia. When you get housing onstream, you employ people in the forest industry, plumbers, electricians, persons who work within permit offices of municipalities. contractors, bricklayers, stonemasons and all the others.

The official opposition believes that one of the major keys to the revival of our economy in a time of collapse is a revival of the housing industry. It is on that basis that we support this — as the minister himself described it — "minor amendment." What we regret is that it is not a major amendment, a major effort to deal with the problems of interest rates faced by the people of British Columbia.

To repeat again. there is a triple tragedy facing the people of British Columbia today: foreclosure and bankruptcy

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caused by high interest rates; unemployment caused by economic collapse; and finally, the failure of Social Credit to depart from the right-wing ideology which has for so long held that there is something wrong about intervening in the marketplace during a period of downturn. There is in fact nothing wrong with it. It is highly necessary and urgent.

I did also have questions for the minister. When he winds up, after my colleague for North Island speaks in this debate, perhaps he could advise the House what interest rate he proposes to set. The amendment does not specify that rate. I think the House is entitled to know because of the cost via appropriation of it. The people generally might be interested in it as well.

To reiterate and conclude, we support the bill. It does a little for a few, and this is better than nothing for anyone. Nonetheless, the New Democratic Party is deeply disappointed that the Social Credit government of the day is not prepared to deal more seriously with the problem than by means of a minor amendment on the question of interest rates. We need a government of boldness, of vision. and a government that genuinely cares about people who lose their homes because of unaffordable interest rates. We care; we argue; we've made positive proposals; and we hope for positive results.

MR. GABELMANN: I welcome this opportunity to participate in the debate on the entire legislative program presented by the Housing minister this session.

MR. KING: And last session.

MR. GABELMANN: And last session and the session before.

After promising for years that housing policies would be announced in two weeks, it took him a year to finally bring some small program into place. As a result of the year-long promise of, "it will be two weeks, my friend," we get this legislative action. What do we get after three years in office since the last election and after obvious public concern about what has been, for some people, the greatest political issue of the day in this province? While for others it's not a great political issue because they're well housed, it still ranks up among the two or three most serious and important issues to face this province and government in terms of its legislative program, and what do we get? We get a self-admitted minor amendment that deals with the interests of those few people who manage to qualify for second mortgages through the provincial government.

It's a good program that we support. It's an amendment that we support. But is this all that can be produced for debate, discussion and action by this government at this time of major crisis in the housing industry? When the whole question of affordability for thousands of British Columbia families is reducing them to living in substandard rental accommodation and when the B.C. Housing Management Commission's lists for subsidized housing are more than 10,000 people long and many other thousands are not even bothering to get on the lists because they recognize that there's no building going on and that they will never get into that housing, what do we get? At a time when foreclosures are up, what do we get? We get a minor amendment.

MR. KING: We get a minor amendment from a minor minister.

MR. GABELMANN: I'm not so concerned about categorizing the role that that minister plays within the cabinet; obviously it's a minor role. What I am concerned about is that within his own ministry he treats Housing as a minor responsibility. It's not the part of his ministry that he cares about. The minister stood up today to introduce legislation. I thought that at long last we were going to get some housing legislation, and instead it was an amendment to the Land Act. The only housing legislation we have is this minor amendment which allows the government, in these times of high interest rates, to possibly reduce the rate. They don't say they will; it just gives them the right to do it.

My colleague from Victoria suggests that we'll support the bill, and we will. He suggests that it will be of some benefit to a few people. We don't even know from this bill whether it will be of benefit to some people, because all it does is give the minister power to reduce the rates for second mortgages for people who do qualify and are fortunate enough to own and still maintain their own home.

Mr. Speaker, I'm not going to speak very long on this bill. We're going to get to the Housing estimates, and that's the appropriate time to have a wide-ranging debate on housing. But I don't think we can let this bill go through, even though we're going to vote for it, without first making it as clear as we can to the public that this is the entire legislative program from that minister for the term of office that they've had. I don't understand why it is that that minister, even in the face of a sustained attack from his allies in the community — those private developers, builders and enterprisers in the organization called HUDAC — still hasn't awakened to the fact that what this province needs is a full housing program and legislative package and not just this minor amendment,

HON. MR. CHABOT: I'll just respond to the questions that were in order that were put by the members from across the way.

First of all, I was rather surprised to hear the first member for Victoria (Mr. Barber) suggest that we should be escalating the upper limit to which the second mortgages will apply. Within his area in the city of Victoria, the mortgages apply to homes that have a value of $140,000 or less. I want to suggest that the average price of housing in the city of Victoria is substantially less than $140,000. Is he pleading the cause of the moneyed people of British Columbia, those people who don't need help? I'd suggest that this kind of program and the grants that come under this legislation go to help those people who need help. It's not there to help those people who can afford half-million dollar houses or $600,000 houses. Maybe that's the cause for which that member is pleading. I'd suggest to you that this legislation that is in place is at its upper limit right now. It will go to help those people who need help. This program is not intended to help those people who can help themselves.

For him to suggest that they have pleaded before that the upper limit be escalated.... I want to say without any reservation that I have never heard from any member of the New Democratic Party regarding the upper limit to which these mortgages will apply. We haven't heard from the New Democratic Party on that issue.

The other point is that in British Columbia we have 38,000 second mortgages which have been made available to people who have not before had assistance from the provincial government for their first home. Under the legislation at the moment.... We're making the change because it's

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tied to the National Housing Act, which prescribes that second mortgages will be about 21 percent. In British Columbia we say that's too much. This change will be in the amount of interest that will apply to second mortgages. It will create the lowest interest rate on second mortgages in Canada. It will not only do that, but it will also make the second mortgage rate lower here in British Columbia than any first mortgage interest rate anywhere in this country today. I can see why those members in the opposition are critical. But in the same breath they are saying, "Yes, we will support that legislation," because they know there are 38,000 families out there in British Columbia who will benefit from this amendment that will effectively reduce interest rates — from 21 percent to 15 percent in some instances. That's the rate for the time being. As time goes on, these rates can be adjusted by regulation. But the projection right now is that the interest rate will be 15 percent. It will be of substantial assistance to those 38,000 families in British Columbia, who will enjoy these second mortgages that have been made available by the government of British Columbia.

The member for Shuswap-Revelstoke (Mr. King) is anxious to leave, so I'm just bidding him goodbye; and as I do that, I move second reading.

Motion approved.

Bill 46, Home Purchase Assistance Amendment Act, 1982, 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: Mr. Speaker, I call second reading of Bill 49.

MUNICIPAL AMENDMENT ACT (NO. 2), 1982

HON. MR. VANDER ZALM: Mr. Speaker, I take pleasure in moving second reading of Bill 49. Basically the bill addresses three matters that have been discussed here and elsewhere from time to time, especially over the last number of months.

First, it provides an opportunity for municipal councils and regional boards to enter into agreements with Indian bands for municipal services. Many valuable, useful lands are located in regional districts within or near municipal boundaries. Those lands have the potential of providing a location for industry, for commercial development, housing or for any number of good options that perhaps ought to be pursued for the benefit of the Indian community as well as for the larger community. We think this is a very positive move. It receives much support from the UBCM and from most, if not all, individual municipalities and regional districts.

Second is the matter of interest rates on unpaid taxes in municipalities and improvement districts. As you are aware, the interest rate in rural areas has been established annually by the Lieutenant-Governor-in-Council, but the interest rates that could be charged on outstanding taxes in municipalities or improvement districts have been established in the act and remained fairly constant for the last while, with a maximum of 12 percent. As much as all of us here and everywhere regret the rate of interest which appears to be prevalent everywhere now and though we are totally disgusted with the interest rates at the level they're at, it seems only fair that the rates on unpaid taxes approximate the rate charged by the banks when someone goes to borrow — particularly. of course, a municipality. Theoretically, if everyone decided not to pay their taxes because they could use the money at a rate of 12 percent, and the municipality was forced to go to the bank and pay possibly 18 percent, you could find all of the resources in a municipality going toward the payment of interest. So it's only right and just that this be amended and changed.

Frankly, I appreciate the difficulty that may be encountered by many businesses and industries which have seen a considerable increase in their tax bill. I can understand where, if the opportunity were available for them to leave the taxes, especially at times of economic recession such as we're experiencing now, this would be an attraction. There is nothing wrong with that: I can well understand it. However, it's up to us as legislators to ensure that any inequities are addressed.

Thirdly, Mr. Speaker. there has been a problem with the ability of a citizen to challenge a regional district bylaw, to quash it in the same manner as a municipal bylaw, and that has presented some difficulty for ratepayers in various areas. They brought it to our attention a number of times and we once more have addressed that in this particular Municipal Amendment Act. Mr. Speaker. It gives me pleasure to move second reading.

MR. BARBER: This bill was introduced as recently as June 9, and it's some measure of the speed with which the official opposition does its business that it's here today on the 14th. I hope the government won't complain that the NDP is holding up legislation by examining it too closely. However, when we examined this one closely, we discover how this bill has come to earn its colloquial title. This bill is known to the general public as the McCarthy amendment, because it was, after all, the husband of a famous Social Credit politician who apparently has so embarrassed the government that they have now decided that they have to bring in a statute that forbids businesses and other property owners from equivalently ripping off their municipality by deliberately refusing to pay their property taxes when due and as due, in order to profit from the difference between the low rate the municipality charges and the high rate that they can get out of banks.

The McCarthy amendment has been prompted because for the last two years now we've discovered that the husband of a well-known politician — presumably with the absolute knowledge of that politician — has been doing just this. It's a pretty low standard, Mr. Speaker. After all, how do you expect businesses in the province to understand their obligations to the community if famous families decide clearly to exploit an unfair and unreasonable situation for personal profit, for family profit, for private profit that has not been earned at all? This bill is known as the McCarthy amendment because a gentleman by the name of McCarthy got caught and criticized, and that is why we have the bill today.

What he got caught doing was, of course, nothing illegal — the minister was quick to point that out in his opening remarks — but just because it's not illegal doesn't mean it's acceptable; in fact, in this case it’s completely unacceptable, I think, to most people in British Columbia. On that basis we're going to support the bill. We support it because we believe municipalities should be empowered to catch those unethical persons who would attempt, for the sake of private profit, to exploit a municipality, to diminish their own communities' revenues by refusing to pay their property taxes on

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time. We support this bill because it will put a stop to that kind of unethical behaviour; we support his bill because it gives municipalities power to look after the interest of the whole community rather than be exploited by the self-interest of just a few people.

The McCarthy amendment is a useful amendment. I expect in the long run to the government because they're sick and tired of the questions that we raise in question period about why a few unethical people will try to take advantage of this loophole for the sake of personal and private profit in order to make a gain at the expense of the community in which they live. I don't know why someone would try to profit from such a loophole. I can't imagine why someone would try to exploit his own community in order to make a fast buck on this basis. I think most members of this House pay their property taxes on time, and they do so even though they know they could make a few quick bucks — not earn them, but make them by failing to pay and by exploiting the difference between the interest rate that a municipality can charge and that which they could get at a commercial bank. You have to wonder what sort of ethics that kind of person would practise.

Why would people want to take advantage of their own community like that? Why would they do that? The only reason we can find is apparently greed — greed, selfishness, and private profit. It obviously hurts the community in which these people are resident, because it denies that community revenue to which they are otherwise entitled — lawfully entitled, I should emphasize. Surely nothing is set by way of a public standard, so that can't be the motivation either. I also presume that the motivation surely would not be, at least in the case of the McCarthys whom we've identified, an attempt to embarrass Social Credit. That's obviously not in their interest, even though that has been the result. I don't understand the motivation of such a person. I don't understand what would drive them to exploit their own town by exploiting that loophole. We're glad the loophole's being closed, but we condemn those who exploited it. We're glad the loophole is finally being shut down and we're pleased to support the bill, but we condemn vigorously those greedy, selfish people, motivated by private profit who would try tried to exploit this loophole.

Most businessmen are honest. They pay their taxes. They pay what is required when it's required. Most citizens are honest and pay their taxes when they're required to be paid. Most people don't sneak around in the dark furtively looking for loopholes to exploit. The kind of people who do that set an ethical standard that we on this side of the House don't find acceptable. Sneaking around in the dark to find a way to get out of municipal taxes in order to make a quick buck that you haven't earned is not acceptable. On that basis, the McCarthy amendment that is before us is better than what was here before. On that basis we support it.

There is a related issue that I'd like to raise briefly, Mr. Speaker.

Interjection.

MR. BARBER: The name is Hyndman, I'm afraid.

MR. SPEAKER: If the name refers to any member in this House, of course we refer to members here only by their official designation.

MR. BARBER: Yes, that's right. On May 10 of this year I wrote a letter to Mrs. Bodkin, Deputy Minister of Consumer and Corporate Affairs, in which I observed that there is yet another loophole. I wish by way of notice now to indicate briefly to the government that we do not accept the double standard here. The McCarthy loophole is being closed down, and that's good, even though we deplore the behaviour of those who would exploit that loophole. However, there remains a loophole for landlords, one that could have been addressed by this bill but is not, let me observe in passing.

I wrote to Mrs. Bodkin on May 10. It is very short, only three paragraphs:

"I write regarding the question of percentage of interest that must be paid by landlords on funds received through the security deposit provisions of the Residential Tenancy Act.

"I note that there has been no increase in this percentage rate since June of 1980, even though bank interest rates have escalated well beyond the 12 percent provided at that time. Would you be prepared to consider a policy that would see this feature of the act tied to a percentage above prime rather than to any fixed figure? If not, would you be prepared to entertain an amendment to the law that would see it fixed at, say, 18 percent, or some other suitably high figure?

"It seems unfair to me that landlords are able to take advantage of this unearned money, and I would appreciate your speedy review and early comment."

Slightly less than 30 days later, which is pretty good, I got a reply back from the Minister of Consumer and Corporate Affairs. It is five paragraphs, but also short:

"Dear Mr. Barber:

"Your letter of May 10, 1982 to my deputy minister, Mrs. Bodkin, has been referred to me for consideration and response.

"The interest rate paid on security deposits is currently set at 12 percent by order-in-council. This amount is reviewed periodically, as is the 10 percent annual rent increase limit for controlled tenancies and the 18 percent allowable increase for renovations. Any change in the interest rate for security deposits would necessitate an examination of the other rates, since the same economic conditions would apply.

"On balance, I believe the current rates being applied to security deposits on controlled units and renovations are appropriate and require no change at this time."

The minister went on to say:

"I also cannot support a floating interest rate paid on security deposits since this would be difficult to administer and would implicate the other rates mentioned.

"I am constantly reviewing the legislation and the adequacy of your policies and will ensure your suggestions are given careful consideration. Thank you for taking the time to write and inform me of your proposals."

What I observe here is the double standard we are faced with when we are asked to support this bill. Commendably, the government is saying that municipalities may now have an interest rate fixed by cabinet and that it may be changed by cabinet from time to time, upon regulation. This is good. That will take into account far more rapidly than often this

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Legislature can, in this instance, the real interest rates they are facing so that the McCarthy loophole can be closed. We commend that.

What I am concerned about, though, is that the government continues to allow landlords to take unearned profit by forcing them to pay only 12 percent on the security deposits. Let me read again what the Minister of Consumer and Corporate Affairs (Hon. Mr. Hyndman) said in regard to this same question of how you set interest rates on moneys that are being held in trust or being owed, say, for taxes. The principle remains the same. The problem of public policy remains the same as well. How do you affix a fair interest rate on that? "On balance," the minister said, "I believe the current rates being applied to security deposits on controlled units and renovations are appropriate and require no change at this time." The public record holds that the last time the rates were changed was in June 1980. They were changed at that time to 12 percent. The 12 percent that landlords have to pay for security deposits is totally inadequate. I would like the same standard applied to them that this bill will apply to municipalities. For public policy to succeed it must be eminently and obviously fair, It is not fair to allow landlords to continue to exploit the McCarthy loophole while at the same time you shut it down for those who would exploit municipalities. It is not fair to do that. If the principle the minister has enunciated is good enough for municipalities — and it is — then I think it has to be made good enough for landlords — and it isn't.

I was disappointed in the reply of his colleague. In second reading I served notice to the minister that the opposition would welcome and support an amendment that would require landlords to pay interest on their security deposits in the way that this bill now requires the McCarthys of the world to pay their taxes according to the current interest rates. Private profit must be earned to be honourable. Private profit that exploits loopholes is not honourable. Private profit that is earned on the basis of real work is honourable. We agree with it, and we also agree that it should be taxed for public purposes.

There is a bit of a double standard here, though. I would be happy to table the letter with the House if a copy is requested. The letter, as I said, was written to me by the minister on June 8, which isn't very long ago.

We support the bill because it removes one objectionable feature that municipalities currently have to suffer and because it closes down the McCarthy loophole and will save time in question period. We wish, however. that the same rule were applied to landlords that municipalities will now be able to apply to a few of their thievish-minded taxpayers who don't pay the money when it's due and try to exploit — because of the peculiarities of the interest-rate structure — a situation that is not ethical to exploit, in our view. On that basis we support the bill but, again, would ask the minister when he closes debate if he would indicate whether or not he is prepared to review the circumstance faced by tenants who have to receive far below market value interest rates on their security deposits. If it is unfair for municipalities to suffer that victimization it is equally unfair for tenants. In the name of a fair public policy we ask the government to address both questions.

HON. MRS. McCARTHY: We have just been treated, once again, to a holier-than-thou dissertation from the member for Victoria. He has done it in his usual style. I get a kick out of the clichés that the socialists give us from the other side. They always put together the good old socialist clichés. It is great to play with words like "fast buck." It is great to talk about high standards or low standards. They love to play with those destructive words in terms of personal tax on people. It is interesting that it was only a very few days ago, and the whole tenor of the address to this particular amendment which this member has just put forward is totally on a personal attack of somebody who is not in this House to protect himself. But it is fair game, of course, to attack another member of this House, through me. That is fine and fair game and I don't mind even taking it. In fact, I am going to be very pleased to vote for this amendment. But I do want to say that it is also another example of what the member for Victoria has called a double standard. It was only ten days ago, in this very House. when the very tenor of the House was called into question by the hon. Leader of the Opposition. It had to do with personal attack and personal innuendo and it had to do with people who took people's personal lives. I recall that there was a great deal of concern expressed by the Leader of the Opposition about the hon. member for Skeena's (Mr. Howard's) personal life that was called into question on the floor of this House. There was a great deal of concern on that side of the House — a great deal of concern expressed throughout this Legislature.

But isn't it interesting that the member for Victoria thinks that to be treated in high-dudgeon should be taken for granted by people on the government side of the House: those who get so terribly concerned and uppity about personal tax on the socialist side of the House do not get at all upset.

MR. BARBER: Did he pay his taxes?

HON. MRS. McCARTHY: Mr. Speaker. you may remind the member who has just taken his seat that I listened to his address, and I think that he could give me the very same kind of attention that I gave to him — without interruption, if you don't mind.

So let it be on the record today that the socialist opposition that feels so terribly put upon when anyone says anything at all, even in jest, even in a quick retort that sometimes happens in this House.... Tempers wax thin; people get a little facetious sometimes, no matter what the mood — whether it be one of anger or one of overtiredness or whatever. Not one second of criticism can the people on that side of the House take. I suggest to you that the high standards which the member has suggested should be carried out on this side of the House, and on both sides of the House, are carried out both in the McCarthy household and in the households of the members on this side of the House. I hope that that can be said of all sides of this House. I can't speak for the socialist side of the House. but there are many people in the business community.... One has to wonder what kind of ethics those people on the other side of the House have, who would in one week call for no personal attacks in the House, and then within 24 hours, if that — in fact, that very day, there were personal attacks made in this very chamber....

It's a typical form of debate, and one which the member has put forward in this House on many an occasion. I would suggest that the member look to his own life and ask if there is anything there that perhaps he would be a little bit concerned about. I hope the member is not implying in any way unethical behaviour of the husband of one of the members in this House — namely, me. I hope that you are not implying that in

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any way, because I think we are protected against that kind of attack in this House. Surely that sense of ethics should also extend, if it is to be clear and honest in this House, throughout all of the debate, not just on one occasion.

Now to return to the bill itself, I'm sure that the Victoria member wouldn't suggest in any way that any of those delightful socialist clichés which he has attempted to put onto my husband are ones than can or will stick to a person who has, through paying taxes in this province for many, many years and through good business ethics, been responsible for much employment in this province. I'm proud of that fact. I can stand in this House and be proud of that fact over and over again; I could do so in years gone by and I know I can do so in years ahead.

So I don't need the hon. member for Victoria to try to bring the debate in this House down to a level to suit his particular brand of politics and the brand on that side of the House. But I do suggest to you that there are some people in the province who, because there has been this possibility for them not to have paid their taxes.... It may have been for that. You can smear any amount of people by name or by a whole block of people, whichever. Let me say once again, because the member has chosen to make this debate a personal attack, that it should be noted for the record that the NDP — the socialist opposition in the House — want to bring the debate down to that kind of level. But I don't think that people in general out there in the public buy that kind of debate, and I don't think they buy that type of concern that is expressed. I think they know full well that the people who are the doers are the ones who are paying the taxes in this province. They work very hard indeed for the dollars they make and the employment that they create for others.

I would just say that I'd be very pleased to support the minister's amendment and all the government initiatives that he is bringing in through these amendments, and I do so with a great deal of pleasure. I would also like to say, because I presume that I can't respond to the member who will now get on his feet, that I think we're going to hear more from the mud line.

MR. SPEAKER: Order, please. Hon. members, in debating second reading of the bill, it is in order, of course, to refer to the principle of the bill. Passing observations can be condoned, but certainly a full-fledged debate on the passing observation is not in order.

MR. HOWARD: Goodbye, Gracie. Hit and run, Gracie. Mr. Speaker, that is very typical of that hit-and-run minister. She engages in all the scurrilous accusations and innuendo that she can muster to her command — and she can muster a great deal — and then scuttles out of the House like a rat deserting a sinking ship. I regret that she is gone, because you will notice that her parting reference was to me. You will notice that her opening reference was to me, and I do wish that she had the courage of her thoughts to be able to stay in the chamber and listen to a comment in reply. Having been maligned by her on more than one occasion, and more particularly in the last few minutes, it would be nice if she were here to listen.

She talked of ethics and I find that an unacceptable phrase to escape the lips of a minister who went the length and the breadth of this province accusing people in this party of developing a secret army, amassing a cache of weapons and using public funds to buy bullets and gunpowder to visit a war upon the general public in this province. It has been proven time and time again that the reference that the minister made at that time was patently false and was developed by her for an unethical political reason.

Secondly, eight or ten days ago the minister made some comments about the Leader of the Opposition, saying that he had made some mention, as she put it, of the private life of the member for Skeena. If you check the record you will find that the Leader of the Opposition made no such reference. If there is something of that nature that deserves to be examined, it's solely in the imagination of the Minister of Human Resources. It indicates that she's not the least bit interested in dealing with the truth in this House, but only with smear.

MR. SPEAKER: Order, please. The member will soon relate his remarks to the bill.

MR. HOWARD: Exactly. I'm about to do that. In fact, I had not wanted to make any comments at all had it not been for the parting shot of the scurrying minister.

I listened to what the Minister of Municipal Affairs (Hon. Mr. Vander Zalm) had to say about the bill.

MR. KEMPF: Hang your head in shame.

MR. HOWARD: Could you protect me from two-story Jack from Omineca, please, Mr. Speaker?

MR. SPEAKER: Order, please. It sounds like protection is needed on both sides. The member for Skeena has the floor. Please proceed.

MR. HOWARD: I listened to the minister outline the purpose of the bill and say that he recognizes that some businesses may have difficulty paying their taxes in these economic times and that nevertheless the change had to be made, and I agree with him. I would point out to the minister that he knew of the manner in which the provision of the Municipal Act limited the interest charges to 12 percent on unpaid taxes. He knew of that some time ago, and he deliberately refused to bring the matter before the House for an alteration because one of his colleagues was involved in a family way with businesses.

I won't bore the House with a litany of the extent of the unpaid taxes of the companies with which that family is associated, except to say that one of them or some of them are in my home town. The municipality wherein I pay my taxes suffered as a result of the failure of some corporations with cabinet connections to pay their taxes. If only the minister had brought this or a similar change to the House when it first came to his attention a couple of years ago that there were people deliberately not paying their taxes in order to make a greater amount of money by putting the money in the bank, then we wouldn't have been faced with having to do it during tough economic times — the earlier done, the better, Mr. Speaker.

I have a sense of authorship in the bill, because I'm quite sure in my own mind that if I, as a representative from Skeena and living in Terrace, had not brought to the attention of the minister a few weeks ago the fact that a particular company having cabinet connections and cabinet associations had not paid taxes to the municipality of Terrace, and if a few days later the member for Nelson-Creston (Mr. Nicolson) had not

[ Page 8171 ]

also raised the point about the same cabinet-connected companies not paying taxes in his municipalities in Nelson-Creston, this would have been permitted to go blindly on. Even though the minister in answering the questions which were posed to him was terribly defensive about it, he did finally come to the House with an alteration which makes it somewhat more in keeping with the ethics which should apply in the imposition and the expectation of receiving municipal taxes.

I also want to touch on a question in the bill that, I think, shows that there is a deficiency — and this is in an entirely different direction than we've been discussing up until now. There is a provision in the bill that says a council may enter into an arrangement with the council of a band of native Indian people to provide municipal services. Another section says that, notwithstanding all of that, any agreement about the provision of those services will still leave intact the provisions of section 409 of the Municipal Act. That's the section, because it's referred to in the bill, I want to deal with.

When a band of native Indian people seeks to lease property to non-Indians by virtue of a provision in the Municipal Act — and that is founded on an earlier court decision in this matter — that band loses its right under the Indian Act of Canada to impose a level of taxation upon that non-Indian occupier of reserve land. Many Indian people, many Indian bands, have engaged in the practice of trying to increase income to the band, increase their participation in an economic way, and have been trying to earn a few dollars for themselves through the process of leasing reserve land to non-Indian people for a variety or purposes. Some of it is cottage land or recreational land; in another instance it may be a housing development or whatever the band perceives to be the best use to which it can put its reserve land. But once it does that, it then, unlike any other group within a municipal structure, cannot levy taxes on that land; all they can extract are the lease or rental fees for the land itself. They are faced with a difficulty in trying to get full value from the non-Indian lessee, because the non-Indian lessee comes along and says: "But I have to pay this relevant amount of land tax and improvement tax to this outside group called a municipality, regional district or whatever it is that's doing the taxing, and because I have to pay those taxes over there, I can't pay you any additional rent." So the Indian band finds itself in a compressed position and unable to act as an organization of that nature should act. Indian bands, many of whom have been engaged in these lease arrangements — and some of them go back quite a number of years — find themselves in a very restricted position. They consistently ask — and the particular request comes predominantly, of course, from those bands which had entered into lease arrangements: "Why can't we have this right of taxation on the person who is occupying our reserve land?"

They can't do it, Mr. Speaker, because section 409(5) of the Municipal Act says that this section applies — the taxation of land, etc. — to land held in trust for a band of Indians and occupied, other than in an official capacity, by a person not an Indian. "Other than in an official capacity" perhaps has relevance to a reserve where there might be an Indian day school under the federal Indian Act, and a non-Indian teacher occupies a teacherage residence on that particular reserve and is therefore on that reserve in an official and sanctioned capacity. What we are talking about is land which is leased to non-Indian people and bands who are now unable to realize any amount of income and are unable, thereby, to realize to themselves and to the band any reasonable income from both leasing and taxation because the taxation part of it is excluded. I wish the minister. having brought in an amendment relating to relationships with native Indian people and band councils, would have taken the step of removing section 409(5) and putting native bands in a position similar to that of municipalities insofar as levying land and improvement taxes are concerned.

HON. MR. VANDER ZALM: First of all, the member is obviously not aware that I first discussed this matter of interest on outstanding taxes with the UBCM in September of 1981. I mentioned during my address to the UBCM that this whole question of interest rates and their level would be addressed in this session of the Legislature. While I certainly don't fault him for wishing to take some credit for having raised it about a month ago. It was already discussed in September of 1981 and we made a promise then to make some adjustments.

We have also heard mentioned several times that it is exploitation to take advantage of this particular provision in this legislation as it now exists with respect to outstanding taxes, First, I should point out for the members opposite that if they really had done some research they would find that if you do not pay your taxes on the due date there is an automatic 10 percent penalty, So, actually, for the first year the interest rate is probably the equivalent of about 20 percent in any case.

Aside from that, however, there are matters that affect the people in the business community and the municipality in a variety of ways. This provision of the Municipal Act has certainly meant in the past — especially during the last year — that those who weren't able to meet their obligation with respect to the immediate paving of taxes were getting a favourable interest rate. That was not the intent of the legislation when it was first devised,. I am sure, nor was it the intent of the municipality when they put the message on the tax notice that people really should not pay their taxes on the due date but continue to have them carried by municipal taxpayers at large. However, as I said, It works both ways. We have municipalities, for example, using licensing as a way of raising revenues, whereas licensing was also intended to be a means of ensuring that there was an opportunity to police business within a community in some fashion. It was not intended to be a source of revenue. We have many businesses paying licence fees much in excess of what the intent had been. It is something that the businesses have accepted, so it is the same in reverse.

To suggest that people in businesses, if they cannot pay their taxes immediately — or, for that matter, if they decide instead to leave them outstanding — are exploiting the municipality is an overstatement, to say the least. But it is up to government to address these sorts of things, I agree. It is not for us to sit here and find fault with those who would take advantage of a particular provision in legislation and call them exploiters. I think it is more up to us, as members in opposition, to bring the question forth and, as members in government, to try to address these very same problems. The word "exploiters" has been repeated many times. and I think it’s wrong to let that term go unchallenged. However. I realize that people's view of exploitation depends upon where you sit and the matter you're faced with.

[Mr. Davidson in the chair.]

[ Page 8172 ]

The first member for Victoria (Mr. Barber) will recall the early seventies, when groups were lined up everywhere, seeking LIP grants and grants for all sorts of projects. In the eyes of many people, those particular groups weren't necessarily obtaining earned income, but were taking advantage of LIP and other programs and abusing them to the limit. I say again that the first member for Victoria should be most aware of that, because he too, I think, was one who obtained much of what I would consider to be unearned income. During his days in the early seventies perhaps he considered that as one thing, but now when someone obtains what he considers to be unearned income, to him that person is an exploiter. So it's all a matter of where you sit. When you talk about earned income, one might question, for example, whether the NDP party itself is involved in using what some might consider to be unearned income when they have little booths in shopping centres, where they have some of their elderly supporters selling lottery tickets, or they give somebody a slice of it and then they use those moneys for their own purposes. So unearned income, Mr. Speaker, can mean different things, depending on the person and the circumstance.

I note that little mention was made of the other provisions in the legislation. The critic for municipal affairs made no mention of the fact that we're providing an opportunity for agreement with native Indian band councils, which has been requested by the UBCM. I notice that no mention has been made with respect to the quashing of regional district bylaws, about which he and others must have received correspondence. Instead, as is so often the style of this particular opposition, they go on a mud-slinging attack by attempting to single out someone who is probably not here to present his side of the issue........ To use mud is all they seem capable of. Unfortunately, we don't get suggestions with respect to other aspects of the legislation.

This is progressive legislation. We're pleased to have support from all members on both sides of the House. I regret that some of the statements made by opposition members in debate are not really worthy of the sort of debate we would expect in this House.

I move second reading of the bill.

Motion approved.

Bill 49, Municipal Amendment Act (No. 2), 1982, 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. WOLFE: Second reading of Bill 52, Mr. Speaker.

WASTE MANAGEMENT ACT

HON. MR. ROGERS: Perhaps during debate on the principle of this bill I could reflect very briefly on the history of pollution control in this province and the Pollution Control Act. The act was first introduced in 1956 by the then Ministry of Municipal Affairs, at which time the pollution control board was created. In 1967 the Pollution Control Act was transferred to the Ministry of Lands and Forests, at which time the director of pollution control was created to carry out technical and legal administration of the act and the Pollution Control Board was empowered to act in the public interest a well as to prescribe standards and to hear appeals from order of the director. In 1967, with the creation of the Ministry of  Environment, the responsibility was transferred to the Ministry of Environment. We now feel it is necessary to expand our activities into waste management itself, rather than strict regulatory control under the Pollution Control Act.

Interjections.

HON. MR. ROGERS: Perhaps these two could go to a committee somewhere, Mr. Speaker, and have their debate.

The new Waste Management Act provides a new approach. It provides for direct participation in the development of waste management plans for municipalities and the control and storage of special wastes, powers to require spill prevention work as provided with municipalities, and to regulate the users of municipal sewage systems.

There are several new features to this act which are bringing us up to date in pollution control. The one which we neglected the longest is what we have termed "special wastes" and which some of the editorial writers have had some fun with, in describing this as a euphemism for either toxic or hazardous waste. Indeed it is euphemistic to some extent, but wastes neither toxic nor hazardous may still require special treatment. This is a word that the British use in all their legislation and one which we are incorporating in this legislation. Many of the things that we use every day, in and around our homes and in business and industry, are neither toxic nor hazardous in and of themselves in the concentrations that the average person uses them in, but simple things that could be used around a home can easily become a hazard or a toxic substance if they are handled in such volumes and quantities as would make them deleterious to the environment. I might point out that we've never done this in the past. Things either went down the drain into the liquid waste disposal, they went to the sanitary landfill and subsequently found their way back into our watercourses, or they went up a smokestack and found their way into the atmosphere. With some wastes, none of those three routes is particularly satisfactory, so in this legislation we have introduced a manifest system — first of all for identifying the wastes which require special ways, which will be done later by regulation — which tracks the wastes from the cradle to the grave so that the producer, the shipper and also the final destination and method of disposal are known. In this way we will address this fourth waste, the waste that we haven't been able to dispose of in normal ways as in the past.

Another thing in this legislation — I know that my colleague opposite has called for this before and will probably support at least this section if he doesn't support the whole bill — is the matter of source control. In the past we have not had source control legislation, and under this legislation we will be entitling ourselves to have source control. The interesting part here is that while one particular chemical substance is diluted into the regular sewage system of a municipality or city, to take it out at the sewage treatment plant is an extremely expensive proposition because of the dilution with regular domestic and commercial wastes. Where that pollutant is the subject of most of the effort in the sewage treatment plant it would seem much more appropriate that we endeavour to take the substance out at source. With this new legislation we will be able to do that. This is especially applicable in the Capital Regional District and the Greater Vancouver Regional District, as well as others. Probably Prince George would apply as well. For those areas with high concentrations of industries which tend to produce these byproducts, this

[ Page 8173 ]

will be a major step forward, one that I think will be welcomed by the officials in the GVRD and my constituency.

In this legislation we are raising the fines very substantially, up to $50,000 a day for pollution and up to $2,000 per offence for littering. I think that that is partly because of inflation and partly because of the fact that we have a much greater awareness of environmental dangers. I must say that the courts, in recent convictions, seem to be taking the higher side of fines rather than the lower side, as they did in the past. This is quite encouraging for those of us who are trying to work on the enforcement side of it.

There is a decentralization in this bill, part of the ministry's decentralization program, which will allow our regional managers to issue permits. That is just one way of speeding up the procedure in those areas so that all permits don't have to come to Victoria.

One of the main features is the business of developing a waste management plan, which is a new way of dealing with municipal problems. In the past we have waited until the municipality came to Victoria with their problem. At that point they would have identified the problem because they were outside their permit or approaching the edges of their permit. They would go to some consulting engineers, have a plan drawn up and bring it down to Victoria. Only then were the experts in the ministry even consulted or advised. We are changing that program quite drastically. We are going to be involved right from the beginning in identifying the problem, identifying alternative methods of disposal, including financing and the various costs, and involved in full consultation with the public, which at the present time doesn't happen until long after the permit is issued. We think this is a much more progressive way of dealing with municipalities. That won't be the situation with industries, because we have no idea what industries' development plans are. They will remain under the existing umbrella of the standard appeal procedure and the business of going before the Pollution Control Board.

We also include in this new act a provision for issuing of variance orders by the minister. This is probably the most controversial section of this bill but one which I will defend quite vigorously because we often find ourselves in situations where either the public interest or delays from extensions from various permits cannot be met by industry and we are faced with a Hobson's choice of laying off people and shutting down the industry because of the rigidity of our permits. While we will always strive to meet the maximum amount of pollution reduction that we can in any one operation, we think it is necessary that a variance order provision be allowed. It is included in this bill. The reason for any variance order will be made public by the minister and published in the Gazette.

In the past we haven't had a spill reporting system nor have we made the development of contingency plans in the event of spills mandatory. One of the sections in this bill deals with that. We make it mandatory for industrial users to develop spill reporting response teams, We can actually require them to put their particular plan into practice. In certain cases this will help coordinate our efforts when we do have the unfortunate spills that occur from time to time within the province.

In this bill we have also amalgamated the Litter Act and the Pollution Control Act. The reason for this is that the Litter Act — originally passed some 20 years ago, I believe — was fine when the container sizes and the container materials did not change very much. The state of the art was that soft drink bottlers and other people put their product out in relatively consistent container sizes and fees and charges and other regulations could be kept in place. The recent changes in the container industry has meant that things have changed very quickly. Last year we were almost caught out by the container industry moving into a non-deposit soft drink bottle which would have caused some chaos in the market. We still endeavour to encourage them to use refillable containers as we think that is environmentally the right thing to do, but we will insist that all containers will still carry a deposit. Whether or not they are refillable is the choice of the consumer and not just the choice of the manufacturer. We have decided to move these particular regulations from the act to the regulations because of the speed with which the container industry changes.

The final thing I would like to mention before moving second reading of this bill is that for the first time we will be allowed to charge for pollution control permits. There are some 3,500 pollution control permits in the province held by industries and municipalities and there is a cost to the government of servicing and policing these particular permits. They are not always done in the best interests of the community at large and in many cases are just in the interest of the industry. It is our proposal, once this act is passed, to begin a process of charging fees for pollution control permits. which we hadn't been able to do under the previous act in the past.

This act brings pollution control and waste management in the province into the eighties. It is a substantial improvement, in my opinion, over the act that we have at the present time. I recommend it to the members and I move second reading.

MR. SKELLY: I think the question is a little less black and white than the way the minister puts it. For example, maybe I should begin with the way the bill has been dealt with by the minister. We are concerned that the bill as presented to this Legislature on June 4 and within 10 days — on a very important bill — we are being required to debate the bill and make it the law of the land. It is significantly different than the approach the minister has taken with the Wildlife Act, for example. The Wildlife Act was drafted in White Paper form and the proposed bill was included with the White Paper and circulated around the province to all groups who were interested and to anyone who requested it. A large amount of public debate and public input was generated around that paper. which is valuable to legislators in this House in informing them how they should be dealing with the bill.

On the other hand. this bill was circulated secretly within the Ministry. We"re told that 18 or 19 drafts were circulating around in the ministry for the last few years, and none of them saw the light of day unless by accident. There's been very little input sought from the general public — those who will be affected — and from citizens' groups who are concerned about the quality of environment and the way that pollution and wastes are managed in this province. It's a very different approach. I question the difference in approach between this act and, for example, the Wildlife Act.

In this act there are large amounts of money involved, and that money is extracted in this way. For example. If a regulation is passed by the government, the effects of that regulation upstream, either in the industry or the municipality involved, could cost tens and hundreds of millions of dollars. So there are millions of dollars at stake in the regulation of wastes and pollution. It seems that whenever millions of

[ Page 8174 ]

dollars are at stake the government prefers to deal very quietly with the legislation, to keep their own counsel and talk to the people in the ministry and possibly to their friends in industry about it, but very little circulation of legislation extends beyond that group of regulators and people who benefit from less stringent regulation.

In our analysis, this bill doesn't put us ahead into the requirements for a waste management strategy of the eighties. It leaves us roughly where we were back in 1956 and 1967. As far as I can determine, there's been very little in the way of substantial change in this legislation, and I think that's unfortunate.

I think that the opposition is going to deal with this bill basically in committee, because there are so many diverse aspects of the bill that it's going to be very difficult to discuss it in principle in the Legislature at this point. Also, as a result of the short time that we've had between the time the bill was presented and the time that debate on the bill has taken place in the Legislature on second reading, we've contacted a number of organizations who were extremely concerned, who had received no prior warning from the government and who would wish to make comment on the bill and make suggestions as to how the bill should go and what amendments should be proposed. They have not had sufficient opportunity to analyze the bill itself, even though a number of copies have been sent around the province by my office. I understand that at least one organization that contacted the minister's office three times still does not have a copy of the bill from the minister's office. It was extremely difficult for that organization to get a copy of the bill, although we did courier it over to that organization at, in this case, personal expense.

As a result of the speed which the minister is using to rush this bill through the Legislature, we'll spend most of our time on second reading of the bill in order that the opinions of those organizations will have an opportunity to be dealt with during committee stage. We are concerned about a number of issues. As the minister said, there are going to be aspects of this bill that we will support, and I'll get to those later. He mentioned one of them already.

We are concerned about the new process that has been developed for the processing and issuing of permits. The old act mentioned a process that objectors could follow to pollution control permits and a procedure by which these permits were dealt with at the same time that the objections of certain people were heard. So there was a discretionary type of hearing process. The director had the power to hear objections and to specify which objectors had standing in that process. We were hoping that there would be some improvement in the public involvement procedure along every step of the way and that when a permit was asked for by somebody who wished to dispose of a waste within the province of B.C., that notice would be filed in the Gazette, as is the present case, so that objectors would be notified or people would be notified of their right to object and the possibility of a hearing would remain open. As far as we can see in the current act, that process has been eliminated and we have now seen the bill reconstructed along the lines of the pesticide control permit process, which has been unsatisfactory and has been criticized by almost every group in the province that's concerned about the due process in considering the pollution control permitting process.

So what happens in the pollution control permit process? Everything takes place in secret. The application is made, an interministerial committee deals with the application, and a permit is granted. A very short period of time remains for an appeal once the permit is granted and posted. The minister has now made the problem even worse by imposing a $25 fee on those who wish to appeal pesticide control permits. The reason for the $25 fee is to deter appellants. Another step taken to deter appellants is in restricting the subjects that can be dealt with in a hearing before the Environmental Appeal Board. We see it as a retrograde step to put the Pollution Control Act in the Waste Management Act. Virtually no one in this province is satisfied with the pesticide control permit process as it is currently structured; thousands of complaints are received every year as a result of that process. During committee stage we will be objecting to the new process that has been developed in the Waste Management Act, and will suggest a new process, or attempt to amend the process in a way that we hope the minister will accept, a way that will allow the full involvement of the public.

I can recall when the Pesticide Control Act was first presented to this House in 1977 by the current Minister of Health. He had such difficulty explaining that act to the Legislature that he pulled it during second reading. He took a number of people from the opposition, at that time myself and Scott Wallace, who represented Oak Bay, up to his office, where we endeavoured to change the act a little so that it made more sense. But every attempt we made to incorporate more public involvement and to get more information out to the public in that pesticide permitting and appeal process was blocked; we were stonewalled every step of the way by the Ministry of the Environment.

It appears that the same people in the ministry who counselled the current Minister of Health have provided similar counsel to the current Minister of the Environment. That's unfortunate, because the little avenue for public involvement that was available to us in the old Pollution Control Act is now virtually eliminated, and the new procedure definitely is not acceptable. We hope the minister will re-examine that between second reading and the committee stage, and possibly take a look at providing amendments to that process.

We do welcome a number of things in the new act. One is that for the first time it does discuss the subject of special wastes, although we are concerned that it isn't treated as broadly as it should be, and as we expected it to be. It appears there are provisions in the act for the transportation, storage and handling of special wastes, but the act is silent on the disposal of these wastes, on how that is going to be handled. The minister could have explained this during opening of second reading debate, and hopefully he will do so when he winds it up.

We would like to know exactly what the plans are for the disposal of special wastes in the province of British Columbia. In this area we are particularly concerned. I know it is a difficulty for whatever government is in power, whether the government changes and the minister changes. Whoever is the government of the day will have difficulty dealing with the question of disposal of special wastes. If, for example, the minister and I changed positions at some time in the future....

HON. MR. ROGERS: God forbid it ever happens.

HON. MR. WATERLAND: It'll never happen.

[ Page 8175 ]

MR. SKELLY: We all gamble this way and that.

If by chance that happens, it would be as difficult for me to deal with the issue as it is for the current minister. Nobody wants a solid-waste disposal site in their back yard. Nobody wants special wastes treated in their back yard. It's going to be an extremely difficult consideration regardless of which government is in power, All I can do as an opposition member at this point is to sympathize with the minister, but I don't intend to go too far in doing that. We did expect, however, that something in this legislation would give us an idea of where the minister was going in the way of treating and disposing special wastes. Unfortunately, none of that is here.

Another thing we are concerned about is that when the requirements take effect, when you announce that you're going to have a manifest system, when you announce that you're going to be tracking special wastes from the cradle to the grave, so to speak, there is a grey area. There are a lot of those special wastes sitting out in the environment right now, sitting on the lots and in the warehouses of industries that are currently producing them in British Columbia. It would seem to me that the minister should, under some emergency statute, have immediately frozen those wastes and required an inventory of them even before this legislation comes into effect. That way you prevent the problems that have occurred in some of the states in the United States and in some of the other provinces in Canada where, in order to avoid the manifest system and the regulation of wastes that have been building up over the years, you dispose of those on farmers' fields, you dispose of them beside the roadways, you dump them in the rivers and in the municipal solid-waste sites. It becomes a very difficult problem then to know what kind of chemicals have been dumped around the province.

I know the minister addressed that at a meeting at Richmond recently and at least is concerned about the problems. So what we think should have happened is that some special ministerial or cabinet order should have come down freezing those wastes, requiring an inventory, and then the minister would have been able to use the manifest system under this act to track those special wastes in such a way that the interests of the people of the province were protected by their transportation, handling, storage and disposal.

We're also concerned about the proposals that the minister has sent out all over North America seeking technologies to dispose of special wastes in British Columbia. I read a number of papers like the Los Angeles Times, where he's had ads seeking information. I understand the minister will be announcing what proposals have been made sometime around July 1. It's unfortunate that this act is coming down in the Legislature without members having the opportunity to refer to that procedure as well. We should really be looking at all aspects of the question. I can recall when the Minister of Energy, Mines and Petroleum Resources (Hon. Mr. McClelland) was dealing with the question of uranium mining in the province of British Columbia. At that time he gave members the courtesy of reading in the Legislature the regulations that would be promulgated by cabinet — at some time after the act came into effect, but at least we had been given the courtesy of knowing what the plans were for the future for those regulations dealing with uranium mining in British Columbia.

So it's unfortunate that we don't have the benefit here. along with the bill and the plans for the special-waste disposal, of the regulations that are going to come down with this legislation. I think that's unfortunate, because in this legislation — and I've never seen it to this extent before, Mr. Speaker; there are something like two pages which grant the minister or cabinet or whomever the right to make regulations pursuant to this act most of the legislation that is going to be governing pollution control; waste management: special waste transportation, handling. storage and disposal; and management of littering in the province.... All of those things are going to be handled behind the closed doors of cabinet and we aren't aware of the bulk of the legislation with respect to waste management in the province of British Columbia. That's unfortunate. because every time that happens, this Legislature — the representatives of the people of this province — is deprived more and more of the rights of representative democracy that have been granted to us down through the ages in this British democratic parliamentary system.

It's unfortunate that more and more of the powers that previously existed in legislation are now being ripped out of the legislation and, in an authoritarian way, turned over to the minister or to cabinet to exercise behind the closed door of the cabinet room and away from the view of the general public. That's an unfortunate loss. not simply from the point of view of the administration of wastes and the protection of the environment in the province of B.C.; it's important and significant because of the fact that a part of our democratic heritage is being taken away from us. In every single bill that comes through this House, that aspect is characteristic of that bill: we're losing more and more of the public's right to deal with issues that affect them on a day-to-day basis.

But in any case, the fact that the bill deals with special wastes is something that we 're pleased with, and we'd like to propose again some amendments to those sections once we have an opportunity to deal with the bill in committee stage.

We are also pleased with the section that sets up the areas where you can control what goes into a sewage system. One of the problems that municipalities experience now is that they only find out about what goes in at the top end of the system when it reaches the treatment end of the system. Then it could not only destroy the treatment system that they have, because they are not expecting that type of material to be dumped. but it could also cause serious problems in receiving waters or lands, as the case may be, because they may not have treatment facilities to handle that type of waste. Again, we welcome this type of legislation included in the Waste Management Act. There are also the problems the minister mentioned of spill-prevention and the required reporting of spills.

In general, I would have to say — because of the fact that it deprives the public of the involvement they had before under pollution-control legislation and because of the fact that it gives the minister and cabinet so much legislative power behind the closed doors of cabinet — that the New Democratic Party will be voting against this bill in principle. In committee we will be proposing certain amendments which we hope will improve the bill and bring it up to a standard that we would like to see in waste-management legislation in this province. It is possible that in third reading we could support the legislation. In any case. we will be making constructive proposals during committee stage to improve the legislation. With those words, Mr. Speaker, I would like to thank you for the opportunity to debate this bill and look forward to the minister's response to my suggestions.

[ Page 8176 ]

HON. MR. ROGERS: In comparing the Wildlife Act and the waste act — because we went to the Wildlife Act with a white paper and haven't on this one — just consider, if you will, what kind of coverage this bill got when we introduced it last week. There are certain people who are terribly interested in waste management and.... We all pollute every day. If you haven't polluted by about 11 o'clock, you should have a coffee and a prune Danish. If you haven't done it after that, go and see your doctor. But you still can't get people interested in waste management.

MR. SKELLY: You're practising medicine without a licence.

HON. MR. ROGERS: That is right.

In every little hamlet, in every village, in every place there is a rod and gun club of people who really wanted to have some involvement. I see quite a big difference there. We are dealing with professional waste managers and interest groups that are involved. I didn't tell any interest groups ahead of time, nor did I talk to industry ahead of time and give them a copy of the bill. I don't think that is appropriate. We discussed the principle of the bill with different groups, but the message from His Honour comes as a message from His Honour.

You dwelt quite a lot on the objectors and public involvement. When it comes to a private industry waste-management permit, the same procedure applies now. The industry decides what they want to do and they apply for a permit. If the director issues them a permit, the permit is subject to appeal and the appeal is brought before the environmental management board. That is the situation that applies now.

MR. SKELLY: That is not what the act says.

HON. MR. ROGERS: That is what it is intended to say. There is no change at all. There is no intention to have any change for the private sector. There is an intention to change it for municipalities, but that is where the public has an input at the first instance, not at the last instance. We have no idea what industry is planning, but we do know about municipalities, so we can put some collective wisdom into it. We don't want five communities around the province all designing different systems, all very expensive, when the collective wisdom of all the people dealing with this problem may have a cheaper and more effective way of doing it. In that case, the minister insists on public involvement ahead of time. If the act says that the public has no involvement or there is no appeal of the private pollution permits, then I give you my assurance that that will be changed.

You mentioned pesticides. I guess we'd better save those for my estimates, because there is nothing in here that deals with pesticides.

MR. SKELLY: I was comparing the procedures.

HON. MR. ROGERS: I understand that.

I want to congratulate and thank you for being honest about disposal of special waste, because there are not too many politicians who are really going to get down there. You do enough study of this subject to really know the business. Everybody wants somebody to deal with it, but you are right: it is the "not in my backyard" syndrome that exists everywhere.

When we proposed bringing this legislation forward and identifying special wastes, at the same time we said: "What are we going to do about them?" We currently export our special wastes. We export some to Alberta and some to Arlington, Oregon. We probably wouldn't accept importation of other people's wastes, nor should we really expect, on a long-term basis, to be able to export ours. It is only by virtue of the fact that the people in Oregon know we are working on the problem that we are still allowed to use that avenue. I think it is incumbent on British Columbia to deal with its own problems in the province. In fact, the very best thing to do is to look after them in the plant or, if one person's waste is someone else's feedstock, we have a waste exchange program starting within the ministry now. That's secondly. The third thing, of course, is to neutralize it and try to ensure that it becomes a non-special waste. The fourth thing is to find some method of entombing it until we either know how to dispose of it or have a use for it. If somebody has any other realistic suggestions or if there are jurisdictions that do it any better.... You may want to get into my travel in my estimates, but I can tell you that I've been through three of these special waste disposal facilities — one in London, one in California and one in Oregon — and they all use a different technique. There is a little bit that's successful to be gathered from all of them. You're right that nobody wants one. Everybody wants the problem solved, but no one wants it in their area.

When we called for proposals from the private sector, I felt we had to bring legislation along at the same time. There's no point in saying to someone: "We want you to build a special waste treatment facility in the province but, by the way, it's not mandatory to get there." So we have called for proposals, and we've had 41 people reply. About 22 of them appear to be serious, and we hope to have it short listed in July. If there are some that are aren't going to meet our standards and they're still spending money, we think we should cut them off at that point.

We've had a number of proposals from a number of different companies on ways of doing it. I believe that it should be run by the private sector, because I think industry should pay for the facilities if they use it, and we should be in the regulatory business. If we were running it as a Crown corporation and passing the regulations, the temptation to crank the regulations up to make sure you get enough volume through the plant is one that just doesn't wash well with me. I think the thing can be run by the private sector and policed by the ministry. So that's the reason that the waste disposal facility proposal and the legislation have come along at the same time. If you are interested in seeing them, I'd be more than pleased to have you come down and look at them.

If you have some amendments — if you don't want to be political about them, but if you think you have some improvements — I'd be more than pleased if you would come and talk to me about them. If there's a better way to improve the act, I don't have a problem with it.

MR. SKELLY: After what happened last year, I'll do that.

HON. MR. ROGERS: Well, the ones last year were a little frivolous.

You mentioned orders-in-council. It's ironic that one order-in-council that we passed was adding a chemical to the list of chemicals that needed treatment, and the other one

[ Page 8177 ]

involved the soft drink bottlers trying to introduce a bottle that wasn't going to have a deposit on it, and that just creates a litter nightmare. The reason you have to do that by order-in-Council is that eventually this House is going to adjourn, and if we have a product on the market for six months and cabinet can't move an OIC, we are never going to get back to it.

I recall about six or seven years ago that a Minister of Environment in Saskatchewan made a statement that liquor and wine bottles were going to have a deposit on them. He even announced what the deposit was going to be. Then they had a cabinet shuffle, he was defeated in the subsequent election and then the whole government was defeated. Well, I talked to Ted Bowerman, who was the Minister of Environment just before the last election and, you know, there are people who are still holding wine and liquor bottles in Saskatchewan waiting for that order-in-council to be brought forward.

MR. SKELLY: That solves the disposal problem.

HON. MR. ROGERS: That's right. But you shouldn't announce these things until you know what you are going to do with it.

Mr. Speaker, I move second reading of Bill 52, the Waste Management Act.

Motion approved on the following division:

YEAS — 29

NAYS — 22

Bill 52, Waste Management Act, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

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

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

ESTIMATES: MINISTRY OF FORESTS

On vote 42: minister's office, S170, 140.

HON. MR. WATERLAND: Mr. Chairman, at the start of the debate of the estimates for my ministry this year, I will make a few remarks. The past year has been a rather busy one within the Ministry. As the members well know, we have all but completed our ministry reorganization. After some vacancies are filled I believe our ministry will be set up to manage in a decentralized way for many years to come.

The greatest concern that we in British Columbia have these days is the recession in the forestry industrial sector. together with a serious recession in our mining industry. There certainly has been a levelling and a continuing decrease, in some cases, of the prices received for products and of the volumes that can be sold in our normal marketplaces. I think we're all aware that the basic reason for this is the terribly high interest rates currently in place in the United States, in Canada and in some of our other market areas. Because of this during the year we in the ministry and other ministries of the provincial government have been making a tremendous effort to expand the market areas into which we sell, as we have done over the last five or six years. I think it is standing us in good stead today to consider that only six or seven years ago over 60 percent of our manufactured products in British Columbia were marketed in the United States. Today that figure is down to just over 50 percent. Had it not been for that effort — and for his effort I thank the Minister of Industry and Small Business Development (Hon. Mr. Phillips) — we would be in much worse shape today than we are.

The long-term prospects for the forest industry in British Columbia are relatively good. We have a good supply of fibre in this province, and through the management efforts that we have been undertaking over the last number of years, I think we can look forward to a continuing adequate supply of raw material for our industry. I'm sure that as soon as the current recession begins to recover, our industry will be in a position to take advantage of it. The state of the industry at this time is such that equity is being lost at a very remarkable rate by most sectors of our industry. Our large and small companies and individual proprietors are losing equity at a rapid rate. Their position with financial institutions is becoming more serious each day. Once this recession has ended, we in the provincial government will have to continue the sympathetic type of administration that we have been carrying out for the better part of a year in order to give that industry a chance to get its balance sheets back in order and begin to again invest capital in the industrial plant of that industry so it will be ready to carry on into the balance of the eighties.

This year we have completed our analysis of the various timber supply areas in the province. We have established annual allowable cuts for the various TSAs. One of the most difficult tasks ever undertaken during my term as Minister of Forests has been the allocation plan for that resource. We had to recognize the licensees in existence and the terms spelled out in the Forest Act for renewing licences or rolling them into the new forest licence. At the same time, we have saved a very substantial volume of wood from long-term commitment in the form of the small business enterprise program. That program continues to build. As we phase in the full allowable cut that we are able to put into that small business program, in the short term, over a five-year period. you'll see remarkable expansion by those independent operators with

[ Page 8178 ]

access to Crown timber in providing supplies to existing industry.

Our public involvement process in the ministry is carrying on and expanding. In most areas of the province I think there is recognition of our efforts in trying to involve the public and having their input prior to decisions by the ministry. The program is working well, and we have received congratulations from many sectors on the nature of our public involvement process. We plan to continue this process, even though Dr. Fraser — who was with us for a number of years — has gone to another job; but we will replace him, and that effort will continue.

During the past year, ending March 31, we planted about 90 million seedlings in British Columbia, which is an all time record. As part of our plan to expand planting and reforestation in British Columbia, this year, barring climatic problems, our nurseries will produce some 97 million seedlings. If we can get them all into the ground this year, it will be another record. We will continue to expand artificial reforestation in British Columbia at the same time as we continue our efforts to encourage natural regeneration.

One problem that was spelled out in our resource analysis a few years ago was the problem of the shrinking forest base in British Columbia. As we know, there are many demands, many of them quite legitimate, placed on land by the people of British Columbia. However, usually when lands are alienated for other single uses we lose some forest land. For that reason, we have continued in the establishment of provincial forests. Currently before me are a number of provincial forests which require passage of orders-in-council to establish them as such. I think that by the end of this year we will have quite a large number of additional provincial forests established. Provincial forests identify those lands on which we can practise forestry in the long term.

As I said, our forest industry in British Columbia is having a very difficult time now. I think it will survive. With sympathetic administration both by the provincial government and also by the banking institution, the basic structure of our industry as it exists today will remain much the same after the recession. Providing we allow for the rebuilding of the financial resources of those companies, I'm sure we will again have the reinvestment and modernization that was carried out over the last five or six years.

Mr. Chairman, I'm sure members of the opposition have many things they'd like to discuss regarding my estimates. I'd be very happy to try to answer their questions. If I can't answer them at the time, I will certainly make every effort to get whatever information they need and bring it to the House.

MR. KING: I'm appalled that the minister has so little to say regarding the forest industry at the moment in the province of B.C. We have the most severe economic downturn in the forest industry that we have ever witnessed in this province. I must say I'm disappointed that the minister did not have anything to say regarding any plans for more positive assistance to the forest industry. There were no specifics whatsoever. I think everyone appreciates that our primary problem is a very soft housing market in the U.S. There's no question. Everyone understands that we rely on the export of our lumber to the United States. But it's not quite good enough for the minister, when introducing his estimates, to note that the economy is indeed soft and the industry is suffering, without his accepting some responsibility for alternative programs that might assist the industry and its workers to survive over the next period of time. This recession has been upon us now for one year, really. It's been deepening with resultant higher unemployment.

Fortunately there have not been many major failures in the forest industry yet, but the minister himself is calling plaintively on the banks to carry the industry and show restraint with respect to any foreclosures on those who cannot meet their payments. I know the minister's heart is in the right place, but I wonder if those kinds of public utterances don't do more to create panic throughout the industry than to persuade the banks and community that there's a need for some pulling together and suffering together under these circumstances. It sounds very ominous when the Minister of Forests publicly calls upon the banks to continue to carry the debts of some major forest industries in the province, intimating and implying that if they proceeded by the letter of the law, indeed there would be foreclosures at hand. I think that kind of approach, rather than a private approach to the banking system of the province, does more to generate panic and psychological depression in the forest industry than any good it might do.

Where are the policies to generate some employment and to try to get some business going in the short term that might assist companies and their workers to survive over the next six months to a year? We're facing a very long, hard winter, when literally thousands of workers in the forest industry will have been out of work for over a year. They will have exhausted their unemployment insurance benefits and lack adequate employment to replenish their stamps and qualify them once again for unemployment insurance benefits. This government and minister are relegating them to a winter of social assistance as a method of survival.

I think it's pathetic that the minister introduces his estimates this year by simply noting that we have a depressed state of the economy and are going to plant some trees, but offers no emergency program, not one alternative to generate some employment and offer some hope to the industry, and not one innovation or new idea. What we have seen is a major reduction this year in the financial allocation under the five year forest and range resource plan that would have generated some jobs in silvicultural treatment. For the minister to then introduce his program in this fashion, without any contingency program whatsoever to try to assist those people who are suffering so desperately in the forest industry, is a bit of a shock.

I want to remind the minister what his colleague said back in 1975 when we had a slump in the forest industry as well. We on this side of the House were in government at that time. The recession was not nearly as deep as it is now. The number of unemployed was about half what it is now. Certainly the outlook for the industry was not nearly as bleak as it is at the moment. The member for Cariboo, now the Minister of Transportation and Highways (Hon. Mr. Fraser), had this to say. It's recorded in Hansard on April 22, 1975, on page 1579.

There are 12,000 IWA members out of work at the present time; there will probably be more due to the pulp market happenings. There are millions of acres of public land which are not reforested because they are taken over by non-productive weeds. There are miles of fishery streams that can be cleared of obstruction. What specific programs will the minister initiate to put these out-of-work citizens back to work for the benefit of the public land'? Surely a program like this would be responsible stewardship.

[ Page 8179 ]

I draw to the minister's attention that in that year, aside from increasing the allocation for silvicultural treatment, $30 million was allocated to the student summer employment program, much of which found its way into programs in the forest industry. But the member for Cariboo, at that time, was so concerned and was asking for a special program when we had 12,000 people unemployed in the forest industry. I don't know what the figure is today, It's certainly around twice that many unemployed. Here we have the minister introduce his estimates with a very mild little introduction. I'm not sure he was going to get up and speak at all, Mr. Chairman. had the opposition not moved to rise on the occasion of his vote being called. I'd like to hear from the minister what, if any, contingency plan he has.

I'm aware that the federal government has put up some money for the so-called bridging program, but as I have suggested previously to the minister in the House, that's a case of too little too late. I don't think there are any firm regulations and rules in place by which applicants can know what the ground rules are and qualify for any program. I believe that not one single program under the bridging policy has been approved yet. If I'm wrong, I wish the minister would provide me with the information. I stand subject to correction, but it is my information that not one program has yet been approved, and accordingly, not one job has been created in the forest industry flowing from the bridging program.

But even if it does get on track late in the season with a minimal opportunity to offer any major benefit to the workforce or the forests, it is so restrictive in its terms that the very people who need assistance most desperately are completely excluded from the program. The bridging program provides for a subsidy to those people who are drawing unemployment insurance benefits. Obviously, many people have exhausted their benefits, so the people who fail to qualify for unemployment benefits at this time are denied access to any job under the bridging program in the forest industry. That's totally ludicrous. Presumably, under that program, if someone who is on unemployment insurance benefits qualifies and obtains a job and his unemployment stamps run out after two weeks on the job, then there's no base rate to subsidize any more and he's laid off. Mr. Chairman, I suggest that that hare-brained. half-baked approach to offering assistance to the forest industry is just not adequate in any way. So I appeal to the minister. If he disagrees and thinks it's a good, viable program, to explain to me where my understanding is wrong and explain to the Legislature where there is one program under the auspices of the bridging arrangements that has been approved and the number of jobs created by it. I would appreciate that from the minister. I ask him, in all sincerity, to let the House know what he has in mind in terms of some assistance to the industry over the next period of time, both to the workforce and to those people in the industry who are having a very difficult time in meeting their payments on equipment.

I was in Revelstoke on the weekend, and I talked to one logging contractor who has $2 million invested in equipment, skidders and logging trucks. He has worked five weeks this year. You don't have to be a genius, Mr. Chairman, to understand that you cannot keep $2 million worth of equipment tied up. It has to be working if you're going to meet your payments and if you are going to be able to afford to retain your business and retain that equipment. He observed to me that it's futile to try to sell it; there's no market for the equipment at this time. It would be fire-sale prices if he did try to put his equipment up for auction. Surely the minister and the government have some contingency plan in mind to help the small operators that will be forced out of the industry if we don't act and do something. Sure the main problem is the U.S. market, but we can't look to the U.S. to solve our problems for us, Maybe we can't solve them all, but at least we can be imaginative enough to try.

Has the minister got anything in mind whatsoever to offer hope to the industry over the rest of this summer and going into the winter? I'd appreciate hearing from him.

HON. MR. WATERLAND: Mr. Chairman, the member for Shuswap-Revelstoke pointed out, as I did, some of the problems in the forest industry, and indeed it is serious. However, since last summer when the bottom really fell out of our market and prices plummeted, we have been using as sympathetic an administrative process within the ministry as we possibly can in order to attempt to relieve the industry of many costs that can perhaps be deferred. Of course. the more you reduce the cost of operation, the better the opportunity companies in the industry have of carrying on and selling into the depressed markets, We've made a lot of moves in an administrative way to help the industry. By helping the industry, of course, we certainly help those people who work in the industry. Many, many thousands of jobs are continuing today that otherwise, had we not taken many of the actions that we have, would not.

Some of the actions we've taken have been specific to certain areas of the province and have helped people who otherwise would not have been able to carry on their manufacturing and harvesting. Some of them are of a more general nature. For example, the Fort Nelson area of British Columbia has a number of disadvantages in addition to that of low markets. They have a very short logging season. they have difficult transportation routes to contend with and other disadvantages. We have made a number of moves to help them. We've allowed them to spread their stumpage payments out over a year rather than pay for it as harvested, as was the case in the past. We've established a special appraisal area for that part of the province, one that recognizes the actual costs they have to deal with, rather than the average of a larger appraisal zone. We have allowed special transportation risk factors in our appraisal and increased their normal risk factor.

In more general terms provincially, we have attempted to allow people to move their harvesting areas closer to the point of manufacturing so as to cut down on transportation costs. We have allowed them to move into higher quality stands of timber that had been passed over in the past, as we move our harvesting around. Of course, they can harvest the higher quality timber,. and the closer they are to town, the lower will be the cost of harvesting and the higher the value of the log. This, of course. will be an advantage to the industry and will allow them to carry on and maintain their employment base, more so than would otherwise be possible.

Over the last few years, we in the ministry have had a tremendous expansion in the silvicultural activities that we carry out. That expansion in itself has assured us that hundreds and thousands more people are working today in forest management than would have been the case if we had not initiated these programs. I am meeting with banking institutions and with people in the industry, and we are discussing ways to offer them encouragement and to satisfy the banking institutions that indeed they will be viable once the depressed

[ Page 8180 ]

lumber markets have picked up a bit. This will allow them to carry on and will cause the banks to have more confidence in staying with them.

I won't underestimate the seriousness of the present situation, but wringing our hands is not going to help the problem. We are taking action in many areas. The employment bridging assistance program — EBAP, as we call it....

Interjection.

HON. MR. WATERLAND: No, we do not have people actually working on projects yet, but a number of projects have been approved by our staff and the regional staff of CEIC, who are our partners in this program. The master agreement was signed by the Minister of Labour of British Columbia (Hon. Mr. Heinrich) and myself several weeks ago; the master agreement is still not signed in Ottawa. The programs cannot actually get underway until the agreement is signed. For the information of the member for Shuswap-Revelstoke (Mr. King), I understand that the appropriate authorization in the form of orders-in-council was passed last week in Ottawa; the agreement only awaits the signature of the responsible ministers there. However, those ministers apparently have been on a conference somewhere and have not yet signed it. We have programs approved and we're in the process of selecting people to work on them through CEIC at the local level. All that is required is the signature of the regional director of CEIC for British Columbia and the Yukon, and our first programs will get underway.

Although it appears to have been slow starting, I must congratulate all those who have been involved — the people from the federal government and CEIC, the Canadian Forest Service, our ministry people, the industry and the prospective participants — for their tremendous cooperation in setting up this program. And it's no small task; there are many administrative problems to overcome. A tremendous amount of work has been done, with a great deal of cooperation shown on all sides. I anticipate that as soon as the master agreement is signed in Ottawa, we will have projects actually underway within a few days.

Under section 38 of the Unemployment Insurance Act, the program is unfortunately restricted to those people who are currently drawing benefits. If they have exhausted their benefits, means will have to be found to re-qualify them, and such means are available. We have been discussing again with CEIC some of the re-qualification projects that they can get underway in various parts of the province. A person requires anywhere from 10 to 15 weeks of work on these requalification programs in order to go back on the employment bridging assistance program. Once on that program, they're eligible for a maximum of 58 weeks of benefit. In any case, anyone who is on unemployment insurance can extend their benefits up to 58 weeks regardless of the level to which they were previously eligible. The maximum benefit, as the member knows, is 52 weeks. Even if a worker were only eligible for 30 weeks, under this program his benefit will be extended to 58 weeks. I hope that by that time — once the program has been exhausted — we will have a recovery in our industry. If not, we will have to search for other means of helping unemployed forestry workers.

I will point out that this program is not going to do planting work. It is going to do other types of silvicultural projects such as spacing, thinning, training for fire protection, establishment of recreational sites and that type of thing in the forests. The total value of the program is in the order of $42 million. The federal government will be kicking in an extra $10 million over and above those amounts they would already have to pay these people for UIC benefits. Our provincial government is providing $10 million through our Cabinet Committee on Employment Development, and the Canadian Forest Service, under the Federal Ministry of Environment, committed $8.1 million to help pay for the logistical support needed to get people to the jobs and to provide them with the tools which they will need to do this work.

There have been a number of administrative problems to overcome. I think we have worked through them rapidly. It should be underway in a matter of days. As soon as that master agreement is signed in Ottawa, we will be putting people to work. With the funding available, we will be able to create in the order of 100,000 man-weeks of work. We figure the average project length on these programs will be in the order of ten weeks. Some will be shorter and some will be much longer. If there is an average of ten weeks of supplementary work for each person, then we will be helping 10,000 people extend their benefits and increase their income during this period of time by about $500 a month, which is not what they would have with their normal jobs, admittedly, but it will certainly help them maintain their lifestyle, keep up their payments on their homes and other things. I think it will be a great benefit to them. The employees in the industry who will be participating indicate that they are very happy about this program and it will help them.

Of course, it has the other benefit of providing enhancement to the forest resource itself. With the funds made available and the work that can be accomplished under this program, together with the moneys under debate in my budget now, I am confident that we will be able to achieve at least those planned silvicultural goals that were in our five-year program last year. So it has the added benefit of enhancing the forest resource and thus the future benefits in terms of employment and industrial activity once our recession has come to an end.

We are taking action on many fronts. No one individual item is the full answer. Indeed, all of it together is not the entire answer, because the root of the problem is something which is far beyond the control of the provincial government or, for that matter, the government of Canada. It is an international problem. We have to do what we can to make sure our industry, including the employees in that industry, survives this recession. I think it will. With the assistance we are providing on these many fronts, the employees will survive and our industry will survive. When the recovery comes, we will be in a good position to take advantage of it.

MR. KING: I am pleased to hear that the minister has that much confidence in the employment-bridging program. He is a bit more optimistic about it than I am. I have outlined some of the problems. Of course, his reference to people being eligible for 52 weeks of unemployment insurance benefits assumes they had been working for a full year prior to becoming unemployed. That is not always the case. I would say it is a 50-50 proposition. Some would be and probably about 50 percent would not be. There is going to be a large number of people, no matter how you analyze it, who will not be on unemployment insurance benefits and hence will be excluded from this program. That is a problem, and I think the minister should look at some more direct program,

[ Page 8181 ]

through the provincial government, of offering some assistance to those people.

The other aspect of the bridging program, as I understand it.... According to the minister's press release, he appealed to the industry to create programs and make application for programs. I can appreciate that there is a variety of sources for the funding — two federal sources, I guess, and one provincial — but so far I have failed to see any profound response from the industry with respect to mounting and initiating these programs. The industry is generally too busy trying to survive at the moment, I suppose.

Can the minister tell me how many applications he has had for the bridging program to be put into effect for thinning the forest or for brushing sites in preparation for replanting and that kind of thing? Does the minister have any statistics at all on the number of companies who have responded to his invitation to make application under the bridging program? He says there's a potential here for 10,000 jobs. That's assuming that the industry is prepared to take advantage of this program and mount the various treatment programs that the minister has outlined. Perhaps he could let me now how many and what size of programs have been applied for by the industry in the province. Is there a heavier participation in the interior, or is it equal between the interior and the coastal area? How is it going? I'd like to hear some specifics on it.

HON. MR. WATERLAND: Mr. Chairman. the response from the employers, who will be called the sponsors of the program, has been good. I can't give the member specific numbers, but there have been literally dozens and dozens of projects suggested. There have been probably 20 or 30 actually approved by our staff or in the process of being approved. The member must realize that we want the work to be meaningful and to accomplish meaningful things in the forest. Most of the programs have so far been in spacing and thinning work in forest stands.

There are many proposals before us now for other things such as brushing sites, rehabilitating sites for planting and recreational developments in our recreation program under the Ministry of Forests. I can't give the member specific numbers. I could certainly try to get those numbers from staff, but they're changing on a daily basis as more and more applications come in.

As to where they are, we are not setting any priorities of a certain amount of money to a certain region of the province. However, depending on the response we get, we may have to do that at a later date. What we're trying to do is approve programs as quickly as we can and get them underway. If we do have to make a selection, we would logically hope to direct projects into those areas which have the most serious unemployment problems, assuming that there are meaningful projects that can be done there. In order to direct the work to some of the more serious problem areas, such as Port Alberni on Vancouver Island and some of our coastal sites, where a lot of the land is under tree-farm licence tenure or private land, we have expanded the scope of the program to include any managed forest land, so there will be more opportunities in those coastal areas where we have serious problems.

I'm afraid I can't give the member specific numbers now. When I do give him numbers they will have to be numbers for a certain point in time. As I say, they are changing almost daily.

MR. KING: Mr. Chairman. I suppose we'll have to accept the minister's word for it. As I understand it, there has not been one person hired under the program as yet. A number of programs are pending approval once the federal government and the provincial government get their act together, I guess, and all the approval systems are in place. Hope springs eternal from the human breast, Mr. Chairman, and I can tell you that thousands and thousands of unemployed forest workers out there are waiting with great anticipation for something to happen.

While I have grave reservations about this bridging program, certainly anything that will offer any hope and assistance is worthy of support. as far as I'm concerned. I would certainly admonish the minister to attempt to try to cut as much red tape as possible and get things going. I'm concerned, though, that on the one hand we're offering a little program and on the other hand we're cutting back in the normal allocations to intensive forest management for the current fiscal year. My analysis and the analysis of our researchers.... It was a little difficult to understand the estimates this year. The form has all changed. I don't know what purpose that was to serve, but it certainly made it a bit more difficult to have to depart from the traditional method of comparison over the previous years in the various ministries. Some considerable research was necessary to determine how we're doing with spending allocations for the Ministry of Forests vis-à-vis the previous year. I would like the minister to pay close attention to my analysis, and if our analysis is wrong I would like to see that explained.

The 1981-82 budget provided for $190.8 million, which in fact was spent by the ministry, plus $35.9 million from the forest and range fund. for a total of $226.7 million. I believe there was an overrun last year of some $28 million from the original estimate of $162.63 million; I think that was probably incurred because of heavy fire suppression costs.

As I understand the estimates for this year — 1982-83 — what we have is $144.66 million allocated to the ministry, plus $83.7 million from the Forest and Range Resource Fund, which provides a total of $228.3 million. If one includes the $10 million allocated for silviculture under the employment development account, the total spending this year will represent $238.3 million. The increase in spending, then, over the previous year is 5.2 percent, which. of course, is not nearly adequate to meet the pace of inflation, much less to accelerate the allocation to silvicultural treatment, which was the original purpose of the five-year Forest and Range Resource Fund.

COFI has estimated that when section 88 expenditures are taken into account, 1982-83 spending will be about $40 million below last year's level. By the end of 1982-83, there will be no funds remaining in the Forest and Range Resource Fund — no funds whatsoever. They are all rolled into the ministry this year.

Mr. Chairman, if the fund had not been pillaged to make up for the cuts in the ministry's regular budget, over $56 million would be available at the end of 1982-83 to provide the ongoing additional spending which was contemplated in the five-year Forest and Range Resource Fund. It was supposed to be — and it was approved by the Legislature on this basis — a long-term commitment. Many people in the industry — the professional foresters and others knowledgeable in forestry — point out that you obviously cannot turn the financial allocation for intensive forest management on and

[ Page 8182 ]

off each year. It has to be an ongoing, long-term commitment. You cannot decide, in a certain year, to increase your seedling output unless it's been planned for a year or more prior to that decision. Those are decisions that have to be made and taken over a period of time so the seedlings will be available for planting, so the sites will be prepared to receive the and so on. I think it's a real tragedy that the minister and the government have cut back on the commitment and the allocation voted and approved by the Legislature for intensive forest management at a time when we have a lull in the harvest of the forest industry, and we could sensibly and practically be increasing the inventory of merchantable timber available. Above all, we could be employing more people during this economic downturn.

Mr. Chairman, it's not just my point of view; the minister has had many letters. I have written to him. Certainly a variety of interested parties in the Okanagan timber-supply area and the Shuswap timber-supply area have written to the minister. They understand the cutback in financial commitment to the forest industry, and they are exceedingly concerned about it. The southern interior forestry association has submitted a brief to the minister expressing in very, very strong language their concern about the reduction in the government's commitment to intensive forest management. We haven't had an adequate reply from the minister as yet as to why the forest priority was one of the first to suffer when, admittedly, there's a time of falling revenues to the government and everyone else.

Why did they cut back on this allocation, this priority to the forest industry, which is the underpinning of our economy? It seems to me that that is an extremely foolish thing to do. It seems to me that if we are going to take any advantage of this lull in our market at all we should be doing so in a way that would make our position stronger when the market does rebound. Certainly one of the ways we could do that would be to try to use this opportunity to set a higher priority on renewing the forest, improving the timber supply and strengthening our position when the market does eventually rebound, as I am sure it will.

What does the minister have to say about this reduction and the rolling of the funds from the five-year range resource fund into his ministry's allocation, leaving it bare for future years? Can he explain that to us?

HON. MR. WATERLAND: The Forest and Range Resource Fund, when set up a few years ago, had the objective of providing continuity of funding for forest management work. We had used some of the funds over the last couple of years, and this year, because of the difficult revenue problems that the government has, we have decided that we must use the balance of that fund. Rather than indicating a lessening of our commitment to forest management, I think that indicates our determination to carry on with forest management. I think it is much better to use those moneys during this difficult time than to leave it sitting in the cookie jar, not providing any forest management work.

This year we can debate this year's budget. Next year we'll debate next year's budget. The funds are needed this year. We are using them this year to provide forest management as per our commitment. Some people would say that it is better to leave that money in a fund somewhere and not provide forest management rather than spending the funds and getting on with the job that we had committed ourselves to do. Our budget this year, dollar for dollar, at bottom-line comparison.... Last year's saving — through the funds, the section 88 offsets and the blue book — after the $7 million saving we were required to make, was more than $293 million. The comparable figure this year is $331 million.

I recognize full well that there has been some indication from people in the industry that they would like not to have to spend their total section 88 commitments, but we are telling them that they can make cost savings where and when they must, but we expect all commitments to basic forestry to be fulfilled, as we are fulfilling all our commitments to basic forestry. That is not an area which is negotiable. We are saying — because now is the time when various licence forms are being rolled into forest licences — that if you cannot accept the responsibility for basic forestry, as you must under a forest licence, then perhaps that licence will not be rolled over. We might have to provide them with a lesser form of licence because the forest licence demands a very high level of management and responsibility on the part of the licensee.

[Mr. Richmond in the chair.]

We are saying that if you are not capable of committing of making an ongoing commitment to that type of management, then you would have a different form of licence which is less secure and which does not have those onerous management responsibilities. There would be no backing down by the industry on their basic forestry requirements under their licences. If by chance some funds are not expended under section 88, then we can redirect those moneys into other areas through another process, because they are simply foregone government revenues that we leave out there to be used by the industry for the purposes we designate. If they don't use them, then they can pay the money to us and we shall use them.

The increase in my budget dollar for dollar over last year works out to about 12.9 percent. I think my ministry has been treated rather well in terms of the budgetary process this year. I think that the commitment we have made to ongoing forest management is demonstrated in the budgetary allotment we received. When you combine that with the additional $42 million of work that can be provided in the forest under the employment bridging assistance program, not only can we meet our basic forest industry goals that we set for ourselves last year but also we can meet most, if not all, of our intensive management commitments as well. Mr. Chairman, even in these difficult times the provincial government is carrying on with its commitment to good forest management. I would much rather spend the balance remaining in the fund this year, when it's needed, than leave it in the fund and somehow forego necessary forest management work.

MR. KING: Mr. Chairman, the minister has got a strange way of rationalizing things. He says he's sure the industry will have to use all of section 88 and exercise all of their responsibility for intensive management. Mr. Minister, I don't know whether anyone has told you yet or not, but the majority of companies are not logging any longer in the province of British Columbia. There's not much harvesting going on right now. Maybe there's catchup to do in terms of areas that were harvested earlier, but they can't be too far back, because the minister always tells the Legislature that he keeps everything current in terms of the discharge of the companies' responsibility with regard to restocking the land

[ Page 8183 ]

and so on. I think it's going to be very difficult for the full obligations under section 88 to be fulfilled in this kind of a market condition. I think the minister is indulging in a bit of a pipe dream in that respect. He's happy that the allocation from the five-year Forest and Range Resource Fund is rolled into this year's budget.

Mr. Chairman, he was the individual who introduced the five-year program and the budgetary allocation along with it as a new era in forest management in the province of British Columbia. The Legislature was asked by the minister, and it responded and gave a commitment to funding for a five-year period. Now the minister has pillaged that fund because of an economic downturn, and there is no allocation remaining for next year. I guess the best thing that could happen to the forests is an election before next year. The minister says he doesn't know what's going to happen next year. I know what the people wish would happen by next year. The whole point of the fund was that we wouldn't be playing the annual roll-of-the-dice game in terms of a financial allocation to intensive management of the forests, that this would be an ongoing commitment. That was the basis upon which the Legislature voted upon and allocated those funds. It's a bit of a contempt of the Legislature to pillage those funds to balance this year's budget, because it was passed through the Legislature on false pretences — on the pretence that it was a five-year allocation to intensive management, and that simply didn't prove to be the truth.

Mr. Chairman, the Shuswap-Okanagan Forest Association has put out a pamphlet. They've circulated every community, and they've circulated every area politician with their concern over the inadequacy of reinvestment in intensive management in the Shuswap-Okanagan timber-supply area. They have this to say:

"How much timber do we have? The Ministry of Forests analysis indicated that the Okanagan TSA can sustain an annual harvest of 2.7 million cubic metres at the present standard of forest management. However, industry requires 3.8 million cubic metres to keep its existing mills operating efficiently. Unless something is done now, in 15 years we will be 1.1 million cubic meters short. What could be the impact of possible timber shortages? A shortage of 1.1 million cubic metres represents direct employment of nearly 1,000 workers and indirect employment for another 3,000 in the Okanagan area. These jobs would be lost. In addition, the shortage represents stumpage revenue of $7 million, and the loss of another $18 million a year in direct provincial, municipal and federal revenues. In the past. not enough stumpage revenue was put back into reforestation and forest management."

They are calling upon the ministry to increase the funding for reinvestment in intensive management in that area, and what we see instead is a cut in the funding.

I don't think the performance by the minister is good enough at all. I think that once again we are shortchanging our number one resource because it's not as highly visible as some of the other services that people in the province of British Columbia rely on. Politically it is a bit more comfortable for the minister and his government to cut back in an area that's not noticed by the general public. Only the professionals in the field and the industry people know what is going on. The public doesn't really see it. The public won't find out until it's too late. The public will find out when we start to lose 1,000 direct jobs in the Okanagan area on a permanent basis.

The minister himself has talked about the shrinkage in the forest land base. Taken in conjunction with the dwindling investment in renewing our forest resource, we are facing a very serious problem in the long term. It's not just the current short-term economic downturn that's a matter of grave concern. Our ability to sustain the kind of annual allowable cut that the existing plants require is a question in many areas of the province. Instead of moving to meet the need by much more intensive management, by thinning programs that can very dramatically increase the wood supply, by brushing programs that allow the snow pack to reach the forest floor for more moisture to assist forest growth.... All these things can be done and can maximize and accelerate the growth of trees in a very significant way.

We are simply refusing to make the kind of allocation we should, because it is politically easier for this government to starve that sector because it doesn't show so greatly before the public, and in the short term it allows them to get by. The tragedy is that in the long term we are going to face the day when, instead of the forest industry — that number one resource — being the major supplier of revenue to the province of British Columbia, which helps to fund our social programs, our educational system, our health care system and the human resources of this province, we are going to see a diminishing source of revenue from the forest industry, simply because we have continually failed to invest the kind of dollars back into the forest industry that should have been allocated.

I am very concerned about that and, quite frankly. I wish the minister would treat it a bit more seriously than he does. Maybe it is just unfortunate that the minister doesn't have enough pull with the cabinet, as some of his colleagues do. The consequence is the further starvation of investment in the forest industry.

I wanted to ask the minister some other questions. This controversy over the proposed designation of a new forest at Kitimat is a matter that was subject to a study by someone commissioned by the Ministry. There were hearings in Kitimat, as I understand it. and all the professional people who were interested and who knew the area unanimously recommended, I think, that there be a designation of that area — I think it is northwest of Kitimat — as a provincial forest. I think it was Mr. Young who made the recommendation. Was it Ted Young or Bill Young? Anyway, a cabinet decision was apparently made which overturned the recommendation of the Ministry of Forests. I know that the professional foresters' association is extremely concerned about this matter and has written a very strong letter to the minister questioning the apparent dedication or political intention of some cabinet ministers to designate this particular prime forest land for another single use. I would appreciate a report from the minister on the status of that particular forest land at the moment.

HON. MR. WATERLAND: The member talked about SOFA, the Shuswap-Okanagan Forest Association. They put too, ether an excellent report. It was worked out in cooperation and with the participation of the foresters in the ministry. I assume the member has seen the audio-visual show they have put together, which really tells it like it is. It demonstrates very clearly that investments in forest management have benefits in terms of enhancing the resource and job creation,

[ Page 8184 ]

and the industrial activity that takes place as a result. I am very much in support of that type of forest management. In fact, that is why we have gone into the planning process in the ministry that we have. That is why our expenditures over the time that I've been the Minister of Forests have gone from a total funding for the ministry of $126.5 million in 1975-76, the last budget year of the previous government, to this year's $331 million. We certainly have put our money where our mouth is in terms of expanding forest management, and we will continue to do so.

I can't argue with the member that sure, it would be nice to have more money for every government program. We have been increasing our funding year by year, and will continue to do so because the economic and the social future of British Columbia depends on a well-managed forest and a thriving forest industry.

The Kitimat provincial forest. The procedure we go through in establishing provincial forests is to have the professionals in my ministry, in consultation with other resource managers, determine the best use of a site of land. The provincial forest proposed for Kitimat is in an area which is probably some of the highest-site forest land in that part of British Columbia, if not in all of British Columbia. We have proposed provincial forest status for the bulk of that part of the province. We had public meetings in which there was considerable support; however, there were some objections by the regional district people and also the administration of the town of Kitimat. They thought that we would be tying up lands which they might need in the future for industrial development. We couldn't agree on how much land was needed, so we have asked the British Columbia Development Corporation to hire a consultant to go in and work with the administration in Kitimat and the Regional District of Kitimat-Stikine and to make an unbiased assessment of the realistic needs for industrial land over the next 20 to 25 years.

There is no objection to the theory of provincial forests or the principle and philosophy by either of those administrations, but they would like to be sure that they have what they will need in industrial land. So we have held off from establishing that provincial forest until we get that report, after which both of those objectors will be satisfied and we will proceed with establishing that forest. It wasn't a matter of overruling Bill Young, our chief forester; it was a matter of waiting until this other matter had been resolved, and then we will proceed. At that time there should be unanimous agreement by the various people who attended the hearings that we are doing the right thing. So it is coming; it's just a matter of this study by consultants employed by the B.C. Development Corporation that is now underway.

MR. KING: Just so the minister doesn't leave the impression with the Legislature — unintentional, I'm sure — that he and the Shuswap- Okanagan Forest Association are cheek by jowl in terms of the investment needs of the forest industry in that area, perhaps I should read into the record a letter that was directed to the hon. Premier on May 17, 1982 — just last month — regarding this question.

"Hon. W.R. Bennett,
"Premier,
"Parliament Buildings

"Dear Mr. Premier:

"Because of joint concern over a further timber supply deficit, our association, in cooperation with the Ministry of Forests, conducted an analysis of intensive forest management options for the Okanagan timber supply area. This work was completed in late 1980, when the technical results were presented to the Ministry of Forests. The study demonstrated that the TSA timber supply can be increased to the demand level, providing the silvicultural program is expanded significantly from present levels and substantial progress is made toward that goal during the next five years.

"This program would help the industry and your government maintain direct and indirect employment for 4,000 people and increase stumpage and tax revenue for the province. Significantly, the silvicultural program would be self-financing. The incremental volume harvested would generate more stumpage revenue than the cost of the program itself. As a means of informing the public of the situation, we have prepared a slide-tape show of the results and presented this to various groups throughout the Okanagan TSA.

"This presentation has been underway since November 1981, reaching an estimated 5,000 people and receiving a very positive response to our request for additional silvicultural funding. Audiences also included regional and Victoria staff of the Ministry of Forests and the cabinet economic development committee. We appreciate that with the current economic downturn and associated budget cutbacks it is not realistic to expect additional funding for silviculture in the Okanagan TSA during 1982-83, but we had hoped our requirements would be incorporated into the Forests ministry's five-year plan starting in 1983-84.

"We were pleased to see the introduction of the first five-year forest and range resource program in 1980 and were encouraged in 1981, when the second five-year plan was approved with an increase in funding for basic and intensive silviculture. A significant source of funding for this program was to come from the Forest and Range Resource Fund, which represented an important commitment on the part of government to provide the necessary continuity of funding to this program.

"We are therefore very concerned over the elimination of this fund, first, because of the lost funding; and second, and more important, because it indicates withdrawal of government's commitment to fund intensive forest management. Programs such as tree improvement and nurseries cannot be turned on and off each year but require a commitment to be funded continuously over the long term. Although the diversion of the remainder of the special fund into the 1982-83 forestry budget helps to meet the fiscal year's requirement and enabled your government to cut back on the amount of forestry funding to come out of general revenue, it will cause a serious restriction on the balance of the five-year plan.

"We strongly protest the elimination of the Forest and Range Resource Fund and urge your government to press for reinstitution and expansion of this fund, so vital to the wellbeing of our province's number one industry.

"Yours truly,

"Shuswap-Okanagan Forest Association."

[ Page 8185 ]

[Mr. Strachan in the chair.]

That association is composed of industries in the area and professional foresters, and their position is endorsed by all the municipal councils throughout the Okanagan-Shuswap area, the regional district boards and, I would hope, all the provincial MLAs in those ridings too, although I didn't see the Premier's reply to that organization.

The point I am making is that as far as that organization is concerned there remains a very serious underinvestment in proper forest management in that particular area of the province. The resource committee of the NDP caucus has been holding hearings around the province respecting forest matters. We heard precisely the same story in the Nelson-Slocan area of the province when we held a hearing down there last month. We heard calls to automatically return a specific and pegged amount of revenue flowing from a timber-supply area to intensive management in that area. rather than turned it over into general revenue of the government.

People are concerned — we haven't had a satisfactory response from the minister in that regard, Can the minister assure the House now that there will be an increased allocation — a significantly increased allocation — to the Okanagan-Shuswap timber-supply area for the next fiscal year? Is he prepared to do that?

HON. MR. WATERLAND: I'm afraid that we'll have to wait to debate next year's estimates until next year, when they are before us. But I will make every effort.... I have discussed the matter of the fund with my colleagues, and there is certainly a great deal of support there for re-establishing that fund when we are able — probably as an account within the revenue stabilization fund, which is a new piece of financial legislation that the Minister of Finance (Hon. Mr. Curtis) has brought forward. He is recognizing the serious fluctuations in resource revenues not only as they pertain to the Ministry of Forests, but as they pertain to all ministries of government.

If the member would dig out the first, second, and current five-year plans, and look at the moneys allocated. he will see that after the first five-year plan, which was very ambitious in itself, the following year we very substantially increased our plans for each of the years within the plan period. I'm sure that if he looks at year one of this year and compares it to year three of the first plan, he'll see that we haven't gone back from our first plan. Because of economic conditions this year we're having to stop the rate of expansion of our silviculture efforts. If we combine that with those accomplishments we can achieve under the employment-bridging assistance program, a lot of those things will happen. I hope we will have projects coming forth in the Okanagan.

The government is as committed as ever to the absolute need for the proper management of that resource. We are not allowing our basic forestry to be decreased in any way this year. We are not allowing any reduction in production of seedlings, which are so essential to reforestation. We are carrying on with our commitments in forestry. Unfortunately we have had to level off on some of the intensive applications because of the very serious financial situation we have in the province. As years go by we will continue our commitment to expanding our seedling production and our total capability of forest management.

MR. KING: This is a typical Social Credit double shuffle, you know. Four years ago we set up a new fund — the dawning of a new era. We allocated some funds to intensive forest management on a five-year basis with yearly withdrawals for that specific purpose, and now the government has chiselled on that commitment. Would you believe that the minister's response now is: "Oh, we're going to set up a new fund." How asinine! Either you have a commitment to forest intensive management or you do not. You have broken the commitment that the Legislature made and voted on just a few years ago. Now their reaction is: "Well. this money is all gone but maybe sometime in the future we will stick some funds into a new program that the Minister of Finance has introduced." Hogwash! That is nonsense. What we have here is a minister who is too weak within the cabinet role he plays to ensure that the proper allocation is made to the forest industry of the province of British Columbia. The heavyweights in the Socred cabinet run right over him. This minister is pathetic. He is totally dominated by the Liberal members of that Social Credit cabinet. That is what is going on.

MR. CHAIRMAN: Order, please. I will remind the hon. member that personal allusions are not parliamentary.

MR. KING: His performance is pathetic. Mr. Chairman, not him. He is not a bad person, but his performance is totally ineffective.

Interjection.

MR. KING: Of course it is unparliamentary to call someone a Liberal, even if you've got a picture of him. It seems to me that that is a picture of the Minister of Municipal Affairs (Hon. Mr. Vander Zalm) and the Prime Minister of Canada. They were both Liberals then. It's unparliamentary to say that.

HON. MR. WATERLAND: On a point of order. I just want it to be very clear on the record that that is not a picture of the minister whose debates are currently before the House.

MR. CHAIRMAN: The point of order is well taken. The committee is reminded, first, that exhibits are not permitted in the House or in committee, and secondly, that we must be relevant to the estimates before us.

MR. KING: I certainly did not want to cast any aspersions on the Minister of Forests. I would not accuse him of having his picture taken with his colleague the Minister of Municipal Affairs, or with the Prime Minister of Canada. I would not do such a thing. I know he was not a Liberal like the Minister of Intergovernmental Relations (Hon. Mr. Gardom), the Attorney-General (Hon. Mr. Williams), the Minister of Labour (Hon. Mr. Heinrich), the Minister of Municipal Affairs and assorted others. I made no such accusation against the Minister of Forests.

AN HON. MEMBER: He never went out on the town.

MR. KING: He never went out with Trudeau.

[ Page 8186 ]

The one thing I was pleased to hear from the minister — I like to be fair and give a person his due — was his response to the new forest designation for the Kitimat area. Could the minister give us any kind of time-frame for when those conflicts with the other possible land-use areas will be worked out? When can we expect a definitive decision on final designation as a forest reserve for that particular land? I agree entirely with the minister that it is prime forest land, and certainly the city of Kitimat can find adequate room for growth and expansion without having to alienate that prime and productive forest growth land. Could the minister elaborate on that for us?

HON. MR. WATERLAND: I'm afraid I don't have with me a progress report on that study, but I'll certainly endeavour to find out how soon it might be expected and report to the House, or advise the member.

MR. KING: The minister has a way to go yet, Mr. Chairman. He hasn't earned his pay as yet. We have many other questions for him.

I received a copy of the deputy minister's directive, which referred to sympathetic administration of stumpage. I know the industry needs all the sympathy they can get in this very difficult economic time, and I think some flexibility is called for in virtually all the administrative areas. What does concern me, though, is that when we have one person, particularly a politician, exercising that flexibility, and there's a departure from the specified rules, regulations and laws, there's also a propensity for error, indeed abuse. Perhaps there's even some political patronage. I'm sure it would horrify the Minister of Forests to think of such a thing happening. Perhaps he could explain to me how he has responded to his deputy's call for sympathetic administration and application of the stumpage guidelines.

HON. MR. WATERLAND: I'm not sure that my deputy minister specifically referred to application of stumpage guidelines in his request to our staff for sympathetic administration. Many things are done, of course, by the ministry in enforcement of regulations, operating areas, etc., that do have cost implications to the industry, but as for the application of stumpage and evaluation process, we handle that in a very straightforward manner. Allowances are spelled out in our appraisal manuals — all those factors that go into determining stumpage. A factor that is really beyond our control and that has a big effect on stumpage is the average market value — the starting point from which stumpage is determined. Perhaps the member could be more specific when he refers to stumpage insofar as our sympathetic administration policy is concerned.

MR. LOCKSTEAD: I thought this would be a good opportunity to ask the minister a couple of questions relating to matters in my own riding. I don't want to cover ground that was covered before by the minister and by the member for Shuswap-Revelstoke (Mr. King).

First of all I want to draw the minister's attention to the sad economic plight in the lumber industry throughout my whole riding. The minister is aware, I'm sure, that approximately 400 people at the Stillwater division of MacMillan Bloedel have been unemployed since the beginning of the year — I think some of them since last November. Over 200 people have been permanently laid off at the MacMillan Bloedel operation in Powell River as of last Friday — 160 CPU members and 41 staff. This is a new development as of last Friday, having a tremendous adverse economic impact on the community in which I live. I'd like to know just what he minister's doing and what discussions he's had with that company with regard to easing the plight of these working people in that community. Small businesses are suffering. People are going out of business all the time as a result of the layoffs in that community, primarily in the lumber industry. Port Mellon, just outside the community of Gibsons, has announced a three-week shutdown taking effect later this month. I'm sure that there will be further shutdowns of the pulpmill at Powell River and Port Mellon, Mr. Minister, in the future.

I'd like to know what you're doing and what kind of discussions you've had. I know that the programs you've announced are not operating; not one new job has been created by your ministry in this large riding dominated by the forest industry. You've done nothing there.

In terms of Ocean Falls, you and your government promised us two years ago that there would be a wood-producing flitch-and-chip operation in that community commencing six months after you closed that community down at the end of June 1980. Almost two years, and your government has not kept its promise to the people in that community. Nothing new is happening there — nothing is happening, period. You're alienating timber in the Rivers Inlet area, in the Kimsquit area, to large companies, some of them multinationals. Much of it is wood that should probably have been designated for a new complex at Ocean Falls. One reason is that we have very cheap energy there. Water is flowing over that dam doing absolutely nothing, and every time the price of a barrel of oil goes up in the world or in Canada, and it continues to rise, that energy becomes more valuable. In that community, we should be looking at the possibility of a lumber-plywood complex. Those things should be looked at, but you're not doing anything. Instead of going to your friends or to whomever, that wood should perhaps be designated for manufacture in that community.

[Mr. Davidson in the chair.]

I'd like to know what your plans are for the four billion or so board feet of timber in the Kimsquit area and for whatever timber is left in the Rivers Inlet area. You've alienated a large proportion of the Rivers Inlet timber already. I'd like to know how you're going to dispose of it and who is going to get the rest of the timber in those areas. It's having a devastating effect on the economy of the central coast of this province.

I don't think it's necessary for all of the timber from the coast of this province to go to the lower mainland to be processed. Some areas in the lower mainland are suggesting that they are becoming congested and that the communities want decentralization. Your government talks about decentralization when in fact it is centralizing everything, including education — but that's another estimate. What I'm saying is that you should seriously look at diversifying and decentralizing the wood products industry in British Columbia, and you're not doing it, Mr. Minister.

I have a number of other questions, including the question probably posed by the member for Shuswap-Revelstoke I'd like to know what the increase is in the export of raw logs or flitched timber from British Columbia. I'd like to know what that increase has been in the last year, for example, a period of

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time that you may have the figures for. We keep reading and receiving information, and we see the orders-in-council allowing raw logs to be exported out of this country to another nation for processing and creating jobs in that other nation, and we'd like to know why this practice is continuing. What benefit to British Columbia can we possibly get out of exporting raw logs out of this province?

I'm very much familiar with the review process and all of those things that the ministry goes through before those logs are actually sent out, but I wonder how many people in this House are aware that once a raw log is flitched — once the bark is removed on four sides — it is no longer called a raw log; it is then processed timber. The fact is that it is essentially a raw log. In fact, I understand that a vessel can carry two to three times as much timber in the flitched condition, thereby reducing the cost of transport of this essentially raw log to these foreign countries.

Interjection.

MR. LOCKSTEAD: It's a cant, the member says. That's the correct term.

This is happening more and more all the time, and we'd like to hear from you your rationale, excuse, reason or whatever for allowing this to happen.

I have a number of questions, Mr. Chairman, and I would therefore move that the committee rise, report progress and ask leave to sit again.

The House resumed; Mr. Speaker in the chair.

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

MR. SPEAKER: Hon. members, on Wednesday, June 9. 1982, the hon. member for Skeena (Mr. Howard) rose on a matter of privilege relating to statements made by the Minister of Energy, Mines and Petroleum Resources (Hon. Mr. McClelland) and the Minister of Finance (Hon. Mr. Curtis). The member at that time tabled a Treasury Board directive dated May 20, 1980, and, in his remarks, referred to documents tabled by the Minister of Finance on June 7, 1982, one being Financial Administration Act regulations, dated October 1981, and the other being budget and administrative policy guidelines and forms relating to hospitality expenses.

It seems that the essence of the position taken by the member for Skeena is that the guidelines contained in the Treasury Board directive of 1980 are sufficiently similar to the present budget and administrative guidelines as to be indistinguishable. He therefore takes exception to the statement of the Minister of Finance to the effect that the mechanisms in place in 1980 were inadequate and have now been improved.

The Minister of Finance, in his statement to the House on June 7, refers to documents he tabled at that time, and says that the Financial Administration Act regulations and the new forms presently in place require detail of hospitality expenditures and detail of who was in attendance. The form in question also appears to require written approval of the minister, the deputy minister or the Treasury Board. There is no evidence that such forms were available in 1980. The minister has advised the House that the forms in question are new forms; his word as an hon. member must be accepted by the House.

As the hon. member for Skeena has also included, in his matter of privilege, statements made by the Minister of Energy, Mines and Petroleum Resources, the Chair re-examined the statement made by that minister on June 3, 1982, at which time the minister said: "No bill or voucher to authorize payment ever came to my attention." Both hon. ministers have stated to this House on separate occasions that they did not in 1980, nor would they now, authorize the expenditure of public funds for the purchase of theatre tickets for personal use. There is no material before the Chair which contradicts these assertions, and I am unable to conclude that the cumulative effect of the material before me raises a prima facie case of privilege.

The Chair must also comment on the form of motion tendered in the usual way by the member for Skeena. Matters of privilege, upon being stated, are accompanied by a motion which normally proposes to refer the matter to a committee of privileges, should the Chair find that the matter falls into the ambit of privilege and a prima facie case has been established. Under the practice in this House, the motion tendered by the hon. member for Skeena would appear to be out of order in that it takes the form of a substantive motion to be moved on notice. In short, the motion does not conform, procedurally, to the rules relating to the statement of a matter of privilege.

For the stated reasons, and upon examination of all the material available to the Chair, I must find that the question raised by the member does not qualify under the rules which have been adopted by this House relating to matters of privilege.

On Friday, June 11, in debate on the motion for second reading of Bill 39, the Housing and Employment Development Financing Act, the hon. member for Shuswap-Revelstoke (Mr. King) moved to amend the motion as follows: that all the words after the word "that" be deleted and the following substituted: "this Legislature views the current economic crisis as completely unacceptable, and calls on the government to bring to the Legislature forthwith adequate measures to deal with this crisis."

This amendment takes the form of a reasoned amendment, a form of some antiquity which has on few occasions been used in this House. The twelfth edition of Sir Erskine May's Parliamentary Practice describes such a motion as follows:

"It is also competent to a member who desires to place on record any special reasons for not agreeing to the second reading of a bill" — or other subsequent stage of a bill — to move, as an amendment to the question, a resolution declaratory of some principle adverse to, or differing from, the principles, policy or provisions of the bill, or expressing opinions as to any circumstances connected with its introduction or prosecution, or otherwise opposed to its progress, or seeking further information in relation to the bill by committees. commissioners or the production of papers."

Every such resolution. however. like other amendments on orders of the day, must "strictly relate to the bill which the House, by its order, has resolved upon considering."

A later edition of Sir Erskine May's Parliamentary Practice, the eighteenth, indicates that such a motion must be placed "on the paper." My perusal of the Journals of this House indicates that where reasoned amendments have been moved. notice has not been given or asked. In addition, our

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standing order 48, which relates to notice requirements, specifically excludes notice in the case of public bills after their introduction. Accordingly, notice is not required, although it would always be appreciated as a courtesy to the Chair.

The second matter on which I reserved decision is related to the wording of the amendment. The principle of relevancy applying to amendments governs a reasoned amendment. May's eighteenth edition states that the amendment must "strictly relate to the bill which the House, by its order, has resolved upon considering," and must not include in its scope other bills then standing for consideration by the House. The amendment is drawn broadly. It does not refer to the bill or to its subject matter, namely the creation of a corporation with power to finance various projects. The scope of the amendment is clearly so broad as to include other bills on the order paper. In addition, it does not fall within the categories listed in the twelfth edition of Sir Erskine May. For these several reasons, the amendment is out of order.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 6 p.m.