[ Page 9427 ]

CONTENTS

Routine Proceedings

Miscellaneous Statutes Amendment Act (No. 3), 1982 (Bill 88). Hon. Mr. Williams

Introduction and first reading –– 9427

Financial Administration Amendment Act (No. 2), 1982 (Bill 86). Second reading.

(Hon. Mr. Curtis)

Mr. Nicolson –– 9427

On the amendment

Mr. Hall –– 9429

Hon. Mr. Curtis –– 9430

Mr. D'Arcy –– 9431

Mr. Stupich –– 9432

Mr. Howard –– 9433

Mr. Cocke –– 9436

Mr. Lockstead –– 9438

Mr. Barrett –– 9439

TUESDAY, SEPTEMBER 28, 1982

The House met at 9:30 a.m.

Introduction of Bills

MISCELLANEOUS STATUTES
AMENDMENT ACT (No. 3), 1982

On behalf of the Attorney-General (Hon. Mr. Williams), Hon. Mr. Gardom presented a message from His Honour the Lieutenant-Governor: a bill intituled Miscellaneous Statutes Amendment Act (No. 3), 1982.

Bill 88 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.

Orders of the Day

HON. MR. GARDOM: Adjourned debate on second reading of Bill 86.

FINANCIAL ADMINISTRATION
AMENDMENT ACT (No. 2), 1982
(continued)

MR. NICOLSON: How many minutes, please?

Interjections.

MR. NICOLSON: Twenty minutes.

HON. MR. BENNETT: Write it on your wrist, the same way you got through school.

MR. NICOLSON: If there is anything about which I could be accused of stupidity, it might be the fact that I never did write anything on my wrist during school. For some reason or other the Catholic parochial background left me with a bit of a hangup about doing that even at university. Had I done what many of my colleagues did, I might have graduated a little bit more cum laude than cum the skin of my teeth.

Mr. Speaker, this bill before us is a most historic 180-degree turnaround. It is a total repudiation of Social Credit philosophy, extolled as recently as June 1982 in the Social Credit Party publication called "Yesterday, Today and Tomorrow." I refer the members on that side of the House to the section that says: "B.C. Social Credit means pay as you go. We are opposed to leaving a legacy of debt for our children and future generations." This publication includes pictures of Hon. W.A.C. Bennett and talks about his achievements in glowing terms. It talks about the pay-as-you-go philosophy and the dangers of borrowing. It talks about steady and real economic growth in the province and refers in disparaging comparison to the years 1972 to 1975. Pay as you go, that's the philosophy. Now we see a repudiation of the Social Credit Party and everything that it has stood for.

I can remember the first time that I ventured up into the interior of British Columbia. One of my university colleagues and I.... Maybe it was in our high school years that we decided, on an impulse, on Labour Day weekend, to drive up into the interior. I remember that when we came to Kelowna we went to the park. We looked out and stood on the beach, and I thought to myself: "This is where the Premier burned the bonds. This is where the barge must have been out here."

HON. MR. HEWITT: You didn't think that.

MR. NICOLSON: I honestly did. I'm not too young to remember that; in fact, I'm not too young to remember times prior to Social Credit coming into power. As a matter of fact, my best friend's mother at that time might be known to some of you, if you are indeed Social Crediters, because she was with the Social Credit movement, coming from the women's Christian temperance movement. I am quite familiar with the very early beginnings of the Social Credit Party. I never did embrace the Social Credit Party, but I certainly knew people that were very much involved with its beginnings.

Yes, I looked out there and I looked at where those bonds were burned and the symbolic flim-flam of the bond burning, the creation of contingent liabilities, which today lead us to have a greater per capita debt than the national debt does. This so-called pay-as-you-go government has more than doubled the actual public debt since 1975. We note that in 1976 the total direct and guaranteed funded debt was over $4.6 billion. By 1978 it had jumped to $3.6 billion, and under the leadership of this government the province slid to $7.5 billion by 1979. In 1980 it was up $8.3 billion, and given the strategy and practice with this government simply with Crown corporations and so-called contingent liabilities, we could look forward to the provincial debt being $10.4 billion during this fiscal year and jumping to $12.2 billion during 1983. Those predictions, of course, don't take into account the vagaries of creating these new three-dollar bills, Mr. Speaker — these treasury bills or, as they're already being referred to, the phony three-dollar bills.

Mr. Speaker, according to the government's submission to the U.S. Securities and Exchange Commission, after four more years of Social Credit free-spending, the level of public debt in contingent liabilities alone would be $17.5 billion. That's equivalent to $6,500 for every man, woman and child in British Columbia. This group across the floor talks about the federal government and its rate of borrowing, when in fact we know that they really embrace the very same philosophy as the federal Liberal government does.

We have these new creations which I referred to yesterday, such as B.C. Buildings Corporation, which shows clearly that its level of long-term debt.... In the form of accounts and notes payable it had accumulated $376 million in new debt by March 31, 1980. Mr. Speaker, as I said yesterday, under previous governments — under the W.A.C. Bennett government, under the Dave Barrett government — we paid as we went for public buildings. Now public buildings are accumulating massive debt — $376 million. That's really a debt. If you were to compare accounts as to how they were kept prior to 1976 and how they've been kept since then, it would show that this government, simply from B.C. Buildings Corporation alone, is $376 million in debt. That isn't even taking into account the manner in which this government has spent almost $1 billion of special funds that were saved by both the W.A.C. Bennett government and the Dave Barrett government.

Mr. Speaker, the B.C. Ferry Corporation, which was another pay-as-you-go enterprise, simply a little wing of the Ministry of Highways, now is an out-of-control, growing corporation — not so much in terms of deckhands and people

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on the ships, but the administration is growing by leaps and bounds; it's out of control. It has, since 1976, sold assets and then had to lease them back under terms of long-term debt.

Another pay-as-you-go project prior to 1976 was the use of computers. Now we have a new Crown corporation, the B.C. Systems Corporation, with $7 million in terms of long-term debt. The Health Facilities Association of British Columbia had accumulated another $6.5 million in long-term debts in 1980.

This government, however, is reaching the limits to which these contingent liabilities can be stretched. They're reaching the limits that can be created for Crown corporations. And now, with their backs to the wall, they are leading us down a new slippery path, fraught with financial disaster. We are now going down that slippery slope with this particular bill.

I want to say again that this government, before embarking upon this slippery path, should seek a mandate, because this particular piece of legislation repudiates what was started with the burning of those bonds, what was continued through the Dave Barrett government, and what this government has tried to maintain but what it has failed so miserably at that it has doubled public debt in its term of office.

What this government has done in British Columbia is to bring about the worst month of August for housing starts since records have been kept. Only 696 new housing units were started in urban areas of British Columbia during August. During the NDP days, and in the year which followed, because a lot of those housing starts were actually planned for initiation during 1976, there were often days in which there were more than 676 new housing units started. There were often projects in which there were that many housing units started. This government has strangled the economy of this province so much that we now have the worst month on record.

Another indicator of this government's disastrous policies is the business of net in-migration which has become outmigration. This province is seeing more people leave than enter because of the record unemployment. The out-migration in this province is another indicator of the underlying ill health of the province. This government has sought to....

I think the failing of this government is that it is not involved in long-term planning. This government has been procrastinating rather than planning. It procrastinates on bringing in a good, honest budget because of the contingency of a possible election each spring. There has been a turning away from facts; there has been an ignoring of facts. The indicators have not been looked at, and now the government has found itself in the position that the only solution they have is to create this new, dangerous policy of instant debt, rolled-over debt, growing and accelerating debt, a debt which is going to be the death of this province, the kind of debt that could put us in a position that no one would ever have believed British Columbia could have been placed in. This might bring us to the point where we are dragged down so far by this piece of legislation that we could see the kind of financial collapse which has plagued other countries to greater or lesser extents: countries like Italy, Argentina and Mexico just so recently.

Mr. Speaker, I collect British Columbia budgets. I don't throw them away when I'm bringing my files up to date. This is one thing I do like to keep. It's so interesting to see the words spoken by past Finance ministers.

I look to that 1976 budget, when the Minister of Finance said:

"Government, like people, cannot go on spending more than it makes. What comes in must balance what goes out. If balance is not achieved, then governments must borrow to pay the bills. Bank of Canada Governor Gerald Bouey warned us only the other day that too much borrowing by governments will stifle growth of the economy. The competition by the public and private sectors for available funds will, in a period of monetary restraint, force interest rates to a higher level."

So we see a period when interest rates have come down a little bit, and now this government wants to compete with the private sector for a limited amount of funds.

The minister went on at that time to say: "As public borrowing increases, then more and more of the funds received for government operation are wasted on debt repayment. This then serves only to rob needed social programs, and cripples planning for new, planned and expanded programs." Could it be that just the change of a Finance minister is enough for this government to repudiate what they said in the flush of success in 1976?

There are other comments. There has been comment recently in the news media over the sustained policy of the province of British Columbia in financing all operating and capital expenditures from income. The suggestion is made that this fiscal philosophy is outmoded because all other provincial governments in Canada and the government of Canada all borrow for capital projects. The implied rationale here appears to be that whatever anyone else is doing must be right. Did we hear this the other day? Did we hear the minister get up in the House and say that they were going ahead with this because it was done in Manitoba, because what's done in another province must be right? Mr. Speaker, it cannot be right; that can't make it right.

For that reason, I would move the following amendment to the motion that the bill now be read a second time. I would move, seconded by the hon. second member for Surrey (Mr. Hall), that the motion for second reading of Bill 86, entitled Financial Administration Amendment Act (No. 2), 1982, be amended by deleting all the words following the word "that," and substituting therefore the following: "It is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money which may be raised by borrowings under the Financial Administration Act."

MR. SPEAKER: The motion appears to be in order, hon. member.

MR. NICOLSON: Mr. Speaker, I don't think that a bill should contravene what I see as the original intention of the Financial Administration Act. This is a piece of blank-cheque legislation. "Blank-cheque legislation" is an overused cliché. But "blank-cheque legislation" was a cliché that somebody in their wisdom coined for this particular piece of legislation, which has no limit on borrowing. We have never seen the like of this when we have extended the borrowing power of B.C. Hydro, B.C. Systems Corporation or any other Crown corporation.

On the amendment.

[ Page 9429 ]

MR. HALL: The amendment which we're discussing comes about because of the opposition's fear of this government's actions in plunging the province into debt by virtue of the way they've been conducting themselves over the past two years.

Mr. Speaker, I want you to cast your mind back to a few minutes before 6 o'clock the other day, when this bill was brought into the House. This bill was brought in just a couple of minutes before 6 o'clock, followed by a sprint down the corridors by the Minister of Finance, who nearly tripped over his syntax in avoiding explanations as to what the bill was about. The following day the minister put out the shortest press release he's ever put out since he entered public life, because he wasn't sure what the bill was really about. This bill, which seeks to reverse the whole basic policy of the party that that minister joined — similarly following a sprint down the corridors — and which seeks to reverse the whole policy that's been the cornerstone of that once-proud populist party.... No wonder we only saw a press release with six minuscule paragraphs, a press release riddled with jargon, a press release riddled with words like "relatively low short-term." I don't know what the minister's idea of "relatively low short-term" is, or "long-term" or "mid-term." We've heard that for nearly 18 months. The minister's solutions for short-term and long-term problems have been a hindrance to debate in this House, rather than a help. Whatever the minister was trying to say, the trouble is now, the trouble is clear, the trouble is apparent, and the trouble is the minister.

Mr. Speaker, the following two days were marked by conflicting statements from the Premier and the Minister of Finance as to what these borrowed funds would be used for, and now we've eventually got that sorted out. At the same time, the opposition is bothered by the fact that for the first time in many years we are, to use a colloquialism, going to borrow money on an open-ended basis for operating — we're going to borrow money for the groceries. This credit-card style, open-ended, Trudeau style of debt production has not been seen in this province for years and years. Notwithstanding some of the control features there are for reporting in the statutes in our statute books, we're not convinced on this side of the House that we have the control required over this government at the present time. That's why we've introduced this amendment. The other reason is because of the 180 degree switch and the attendant case with which the members of the treasury benches have swung their policies and principles around to meet this change in direction.

Mr. Speaker, the first steps towards plunging this province into major debt — a clear reversal of policy — have got to be taken very carefully, and we've got to look at the record. A major statement of fiscal policy was made by the Minister of Finance during his budget address in 1981. In 1981, he said — and I quote from Hansard:

Priorities for 1981-82: the balance of choices. The unusual combination of a strong economy and yet slow government revenue growth has forced difficult choices upon us. If the budget is to be balanced, additional revenue must be raised to meet expenditure needs, or government programs must be drastically cut. The third possibility — that of running an operating deficit — was ruled out early in our planning. This government is not prepared to consider borrowing to pay operating expenses. Too many governments have adopted this short-sighted way out of their financial difficulties only to find that tough decisions become even tougher to make as the debt load accumulates. It is a problem which is painfully obviously at the federal level.

They're following the federal example exactly in this legislation.

In this major statement on policy he went on to say: "I do not intend to leave that legacy to my successors in this portfolio." With the cancellation of the nominating convention in Saanich this week, are we to look at those words with some foreboding and look upon somebody in this chamber who may have to pick up that promise and look at its true worth? Who will the next Minister of Finance be to pick up that legacy?

He goes on to say: "For those reasons we consider it responsible to face fiscal difficulties now, rather than to put off for future British Columbians to cope with" — not very good syntax. "Once again, therefore, this government's budget will be balanced." That didn't happen in 1982. Even when the budget papers were presented this year we knew they didn't balance. Even while the budget debate was going on, some of the basic material that was used to assemble the budget was being altered by its authors, namely the Royal Bank. We stood up in question period and asked if, in view of the fact that many of the supporting economic data the minister had used for his budget were being changed, the minister was prepared to present amended bud-get papers. The answer was no.

[Mr. Strachan in the chair.]

Each time we discussed finances, the minister used "mid-term, short-term, things are getting tough, things aren't so bad, maybe they're going to be a bit tougher next week," and it got worse and worse as the months went on until, when we got out of here in August, we eventually found out that we were facing the tremendous shortfall in revenues we all have come to live with.

Interjection.

MR. HALL: None of it is the minister's fault. I never said that. What I've said all along is that we weren't facing up to it when we had the papers in front of us.

The second address on government policy was made by the Premier during the same debate. He said: "The point is not to dwell upon the past. We're dealing with the realities today and what a government coming into today can do about financing the established programs for people and what priorities and choices we have in developing this province. I want to say now that this government rejects increasing the debt...." We can all see and hear him saying that. It's all changed now.

You know what he said on Friday morning It was entirely opposite of what he said here. It was a 180-degree switch. No wonder he's cancelled his nominating convention. He's got to get people doing the new think, the new speak and the new Social Credit fiscal policy. It's not the Social Credit fiscal policy on which he got elected in 1975 and 1979, — it's a new one. It's the same kind of fiscal policy that Billy Davis has had for years and years, acquiring the biggest provincial debt any province has ever had in the history of this country. Now you've got some of his advisers giving you the best advice they can. It's not good for B.C. We don't need those Ontario advisers in B.C. Look at what they did for Bill Davis and his debt.

We have Trudeau credit-card style debt approaching this province. That's what we have in this bill, and that's why we have moved this motion. Let me remind you what the motion is. It's not in keeping with proper fiscal policy to have no

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limitation on the aggregate amount of money which may be raised by borrowings under the Financial Administration Act. We want to know how much.

The third major statement on government fiscal policy was made by the ex-Minister of Finance, the member for Vancouver–Little Mountain (Hon. Mr. Wolfe). He said:

"Few areas of the world could compete with British Columbia's standard of living and the types of services provided by government. The programs supplied to people in this province are good programs. They're important programs and, just as important, they are fully paid for."

We'll find out about that on October 1, when the first report on borrowings will have to be laid in this House, if there have been any to date.

"There is no hidden debt piling up in the closet waiting to be dumped on British Columbians. What we've got we've paid for."

That wasn't quite correct, because we have a fleet of ferries that we haven't paid for. However, allowing for that:

"We can pass on a province to our grandchildren that is able to provide them with the same opportunities we enjoy, a province whose social services are not in debt."

Well, with the passage of this bill that's no longer true.

"Those British Columbians will thank us for the foresight to realize the importance of service programs which understand economic realities. For many, it will be easy to abuse this province's triple-A credit rating when revenues are decreasing. Why not borrow and go into debt to pay for the services British Columbians have come to enjoy? Easy answers to difficult questions. Further and further into debt. And why not? Those who would put this province into debt year after year recognize they'll be long gone when the piper finally has to be paid in full."

Interjection.

MR. HALL: Well, that's what is going to happen. And who's going to be long gone? The man who made those statements, the second member for Vancouver–Little Mountain (Mr. Wolfe). He's not running again. Perhaps this is why he is not going to run again: because he doesn't like this bill. I'm hoping that the member for Little Mountain, the ex-Minister of Finance, will join with us in remembering those words, when he was supporting the present Minister of Finance in the fiscal policy that was then the rule of the day. I'm hoping that he'll join with us in voting for this amendment to this second-reading motion.

Well, that's what they used to say. My, how things have changed! But we need this kind of disclosure. We need disclosure so that we can understand the rhetoric of the minister, so that we can understand what he means when he's answering the questions that come to him most days of the week when we're asking about the financial fortunes of the province. We need this kind of discipline so that we can report to our constituents, and the media can report to the province as a whole as to where we are.

What we really need, of course, is a new budget, because you and I know, Mr. Speaker, that the budget tabled six months ago was not a very good document in terms of reflecting the reality of the day. It would be a marvellous document if it could have withstood the economic pressures and changes of the day. I can't understand why the government, with the modern legislative process that we all enjoy, could not see fit to amend it on a quarterly basis, or amend it in some form by which the legislators, who are charged with the responsibility of dealing with the province's economic health, could make the debate more realistic. We need a new budget; we need a full statement. We need to know how much we need. We need to know what we're cutting out. We need to know what we're doing without. We need to know what their priority list is.

I don't want to borrow money for some of these so-called megaprojects that they talk about over there. I'm not anxious to see our credit rating...and us go plunging into debt to do some of the things that they want to do. But that's only me speaking — only one out of 57. There are others who have got different viewpoints. That's why it should be debated in here. That's why we should have a new budget. That's why in any modern legislature — and there are a dozen other jurisdictions I could name — we would by now have had revised financial statements. We would have had an opportunity to debate that — the opportunity the Premier seems to want, to have all the time to debate his priority list. He thinks that by having an election he debates the priority list. You know you're not really debating that at all. That's just a gladiatorial contest — television, stuff like that. That's not debating fiscal choices, especially when you've got a gerrymander bill going through at the same time. The minister and I know that to have a real debate on financial choices you have to do it in here, based on proper financial information, and not the kind of stuff that was outdated before he printed those new sheets and put them in front of us. That's why we move this amendment, that's why we need limitation, and that's why we need disclosure.

That's why there must be hundreds of people in this province — whirling around like dervishes — wondering what has happened to that grand old party that believed in pay-as-you-go. What has happened to it? Why are they taking this 180-degree reversal? What's happened to all those brave words of the budget debate in this chamber just 12 months ago? What's happened to all those election leaflets my colleague from Nelson-Creston (Mr. Nicolson) was showing you.

Today, more than ever, that's why we require this minister to place before us the facts, the revised estimates and the priority list of what is being cut out. That's why I have great pleasure in seconding the motion that second reading of the bill be altered. I believe it is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money that can be raised by borrowings under the Financial Administration Amendment Act.

HON. MR. CURTIS: Speaking to the amendment before the House at this time, I would like to take only a few moments and attempt to confine my remarks to the amendment, a copy of which has been kindly supplied to me.

I must say that I enjoy hearing debate from the second member for Surrey (Mr. Hall). We disagree on a variety of issues; that is well known. We are philosophically opposed. However, he is one member opposite who does not need to resort to personal attack in order to make what he believes to be a valid point.

Yesterday afternoon and again in the relatively short time we have been here this morning there has been reference to credit-card unlimited debt, unlimited authority, no control.

[ Page 9431 ]

Indeed, the member who has just taken his seat made the same point. Clearly that is inherent in the amendment that has been presented and accepted.

In order that there be no doubt, may I say that the government does not accept the amendment offered by the member for Nelson Creston and seconded by the hon. second member for Surrey.

I think it is important for all of us, if I may say so, to understand that with respect to the charge of open-ended borrowing, the amendment contained in Bill 86, which is before the House — not the amendment presented by the opposition.... The bill authorizes borrowing only to the extent necessary to meet disbursements authorized by the Legislature. Further, and I appreciate that this is understood by all, it requires the tabling of a report on the amounts borrowed within 15 days of the borrowing or, in the case of the House not sitting, within 15 days of the House reconvening. That is understood and accepted by all of us, and I think it was alluded to in the comments made yesterday particularly.

The first point is the one that has been lost sight of; it has been elaborated on by some of the socialist members in their opposition to this bill. Because it is fundamental not only to the amending motion offered by the NDP but also to the bill it seeks to amend, may I repeat: the Legislature, as usual, will authorize certain spending by government. The amendment contained in Bill 86 authorizes borrowing only to the extent to meet those spending levels. Therefore, with respect, I reject the claim that it is a credit card, that it is open-ended, that it is uncontrolled. Indeed, without in any way attempting to direct the Chair, I wonder if the amendment that has been presented and accepted is not therefore drawn on a completely incorrect premise, insofar as it says that it is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money that may be raised by the borrowings.

Again, the Legislature remains supreme, not only in setting the limit of the budget, through the normal budget speech debate, but also in terms of allocating in Committee of Supply those funds for each ministry, each activity in government. Then it has the further checks: obviously the auditor general after the fact, and obviously the report on borrowing that is to be tabled within those 15 days of the House.

MR. COCKE: It's a bit late then, isn't it?

HON. MR. CURTIS: You see, Mr. Speaker, the member for New Westminster wasn't listening.

MR. COCKE: I was listening to you.

HON. MR. CURTIS: Clearly he wasn't listening. If he wasn't listening, then he didn't understand that the Legislature sets the expenditure limits for the government of the time.

Interjections.

DEPUTY SPEAKER: The member for Omineca (Mr. Kempf) and the member for New Westminster (Mr. Cocke) will come to order. There will be ample opportunity for both members to participate in this debate.

HON. MR. CURTIS: I've made the point three times. I assure my colleagues and members of this House that that is clearly the purpose of Bill 86 and that is clearly the control which is in place. It is not good enough to say it is a little late; again, we debate in advance how money should be given to the Crown in order to carry out the activities of the province in that particular time.

I will have more to say at the closing of second reading debate after this amendment has been dealt with. There are a number of things which I think should be made abundantly clear at this time.

Let no member on the other side refer to this again as a credit card or a blank cheque, as one indicated yesterday. I think it was the member for New Westminster.

MR. COCKE: Right.

HON. MR. CURTIS: He made a very interesting demonstration of pulling out the cheque book, taking the pen and writing down an unlimited amount of money. The control remains in this Legislature and with this House. To call it blank cheque, unlimited or uncontrolled is absolutely not correct. The government rejects the amendment.

MR. D'ARCY: I speak in favour of the amendment. Hopefully the minister and government will be listening, and will realize why we on this side of the House feel we must speak up on this amendment on behalf of the people of B.C. on this amendment.

This bill is, in fact, the culmination of an alarming trend that set in with this government the very day they were elected. Prior to that government's being in office, this province had no ferry debt. It had no computer systems debt. In fact, those costs were contracted out to the private sector under both the New Democratic government and the former Social Credit government. Now we have a Crown corporation for that, and that Crown corporation has a debt. We had no buildings debt. British Columbia buildings were on a pay-as-you-go basis, by long-standing provincial government policies through many governments and swings of the political pendulum. Under the present government, the B.C. Hydro debt has tripled, and the B.C. Rail debt has doubled. Lord knows how high it's going to go with the expenditure on the northeast coal railway. As you know, substantial special funds were set up in this province, accumulated over a number of years through two and more provincial governments. Those have all been squandered by the present administration.

So the pattern of borrowing is not something that suddenly happened with this bill. What has changed is that instead of bringing in debt authorization bills on an annual or whatever basis, we now have a blank-cheque bill. It's a bill to allow the Premier and his Finance minister to take B.C. to the pawn shop whenever they feel like it, for whatever amount they feel like. The member for Vancouver–Point Grey can tut-tut; he will get a chance to speak on this amendment if he wishes.

In B.C., historically we have had a pattern that when times get tough — we all know that times are tough in major parts of the province right now because of the incompetence and insensitivity of the present government — provincial governments cut back on capital spending in order to maintain the operation of facilities already in place, to maintain the services to people in health, education, social services and so

[ Page 9432 ]

forth. Instead of cutting back on major capital expenditures, his government, for the first time in the history of B.C., is in fact increasing those expenditures, and for the first time in the province's history they are making major cuts in services. Indeed, some people who would still like to be supporters of the Social Credit Party have stated that they feel that one of the options the government should look at is the cutting back of capital funds in order to maintain essential services in the fields of education and health. But the government isn't listening; what they want is to borrow more money, without even stating to the House how much money they intend to borrow.

I would like to note that one reason industry has been having a great deal of trouble in this province is because property taxes and licence fees — taxes on production, rather than on income — have been doubling, tripling and quadrupling just in the past few years. As many people from industry have said, the Socred government is in fact privatizing the government's debt. A case can be made that this is exactly what's happened.

This year, for the first time in its history, British Columbia Hydro is not going to be in a position to put any money into its sinking funds. In fact, it is probable that in order to avoid taking a loss, B.C. Hydro is going to have to deplete its sinking funds this year, for the first time in that corporation's history. Fortunately, we're not in a situation where Hydro will have to use any of its borrowing power to meet its operating expenses, but there is a distinct possibility that they are going to have to dip into their own kitty, which I think is tragic indeed.

We know about the dangers of unlimited borrowing, the ability to take a province or any jurisdiction to the pawnshop.

We see what has happened at.the federal level with the government's friends Mr. MacEachen and Mr. Trudeau, and how they have been able to run up debt. We also know that over the past few years this government has practically made a career — in fact, the Premier has practically made a career of saying how terrible the federal government's borrowing is, how terrible the federal government's deficit is. Now we find the government of B.C. wanting to do the same things they have criticized the federal government for during the past five or six years.

Quite frankly, I agree with those criticisms. I agree with those speeches made by the Premier. I don't think the federal government should have behaved in that way. I don't believe this provincial government, or a government of any stripe, should behave in that way. The fact is that the public of B.C. is very worried. They are horrified and panicked by this government seeking these borrowing powers through this bill. No matter how pious the protestations of the Minister of Finance and other people on the treasury benches, the fact is that nobody in the public sector wants major capital spending to be initiated at this time. Look around the province. I'm sure you will not find very many money referenda in municipal elections this fall. They're not being put because (a) the municipal councillors don't want to put them, and (b) even if they did, they know that in all likelihood they would be shot down in flames by the electorate.

Yet this government continues to go to the international financial community to mortgage B.C., to take us to the pawnshop in order to pay for bigger and better projects that they feel are going to aggrandize their own image with the public. Rather than aggrandizing their image with the public, they are increasing the apprehension and worry of the public regarding the finances of this province, which we all have to pay in the future. We as citizens, and our children as they grow up and get into the workplace, the professional place and the business community, are going to have to pay the bill that the's government is running up. They are going to have to pay the interest on the bills and on the money borrowed to pay the interest on the bills that this government has run up since 1976.

We have listened to the people of B.C. I have listened to the people in my constituency, and they are tremendously worried about this particular piece of legislation. Perhaps the government too should be listening. The people who are most concerned about this piece of legislation are those who in previous elections have on occasion leaned towards the Social Credit Party. I don't purport to know how individuals vote in an election, but I have many constituents who have indicated to me that, while they have leaned towards the Social Credit Party, they are worried and horrified by this particular bill.

What the people of the province want from government, from political leaders, from all of us on both sides of the House, is some indication of good faith, of hope, of leadership and security. This particular piece of legislation militates against all of those emotions, feelings and concerns of the public. I sincerely hope the minister and his advisers listen to those concerns of the people, accept this amendment, and roll this bill back so we can all get together on rebuilding the province out of the mess that it's in and give a little confidence and hope to the general public who are going to be paying the bills.

MR. STUPICH: I appreciated the remarks today of the Minister of Finance, telling us that there is indeed a legal limit on borrowing, but I'm not sure where the legal limit is spelled out. Certainly as I read section 43 of the legislation, I don't see that there really is any legal limit. Whenever the consolidated revenue doesn't have sufficient money to meet lawful disbursements, the minister may borrow. That's the way I read section 43. I suppose the question might be: what are lawful disbursements? Certainly lawful disbursements are everything that is voted on by the House when passing estimates, but when the House is not sitting the cabinet has power to pay money almost anywhere in any amount, and then have it approved later on. Special warrants are issued by the cabinet meeting quite regularly, and over those special warrants the House has absolutely no control until after the fact. By then it's too late to say whether or not these payments should have been made.

Again I come back to the famous — or infamous, depending on your point of view — Clarkson Gordon report the government had commissioned in January 1976. The Clarkson Gordon report made it very clear that the government may, at any time, make grants to any of the Crown corporations in any amount for the purposes of those Crown corporations, and that all such grants are properly charged against consolidated revenue at the time they're made. Such grants, of course, are very convenient to the Crown corporations. It puts them in a good position. It will also reduce consolidated revenue if the government is interested in doing that, for whatever purpose. But they're lawful. Section 43 says that if consolidated revenue is short the minister may borrow.

The argument has been made, I believe, by every speaker on this side of the House who has spoken so far in the debate to the effect that the bill before us now is an unlimited credit

[ Page 9433 ]

card, a blank cheque for any amount of money, and gives the government the authority to borrow any amount of money for any purpose, for any length of time, and with no suggestion even, let alone guarantee, that the money would be paid back. It allows the government to borrow money to pay back loans made to reimburse consolidated revenue in the event that consolidated revenue is falling short. It allows them to pay interest on those loans and roll them over indefinitely.

When the minister spoke briefly he denied that it was a blank cheque and a completely open credit card. I invite him to explain to us when he closes debate just exactly where the limitation is that would prevent a government from making any expenditure it wanted to make until some time after that expenditure had been made. As I read the legislation, the government has the authority to pass special warrants when the House is not sitting, to come back to the House to get approval for these special warrants, and indeed to spend money as long as it's for a lawful purpose. Certainly making grants to Crown corporations is a lawful purpose. It is a blank cheque and completely open credit card. I invite the minister to tell me how it is anything other than that.

MR. HOWARD: I listened with interest to the Minister of Finance, with his usual careful way, explaining why he and his government object to and will vote against this amendment, which in parliamentary terms is called a reasoned amendment but in common-day parlance everybody in the province will understand is a reasonable amendment. I say again, the bill gives the Minister of Finance unlimited borrowing powers, regardless of his argument that it does not.

The minister, under the bill before us and in concert with the Financial Administration Act, has no limitation on the amount of money he may borrow. There's no limitation stated in section 43 of the Financial Administration Act. There's no limitation in borrowings for redemptions in section 42 of the Financial Administration Act, and for the minister to say therefore that there is a limitation is patently inaccurate. The minister knows it's inaccurate.

Let's take an example. He's not talking about the estimates, approved by this Legislature, for money to be expended for certain purposes. A case in point: March 31 of this year, around the witching hour of midnight and just before the fiscal year ended, this government, this Minister of Finance (Hon. Mr. Curtis) and his colleague the Minister of Industry and Small Business Development (Hon. Mr. Phillips) wrote a cheque, without authorization of the Legislature, for the sum of $45 million, which they sent to B.C. Rail. The member for Nanaimo (Mr. Stupich) has very properly pointed out that the firm of accountants that examined the books a few years ago — Clarkson Gordon — spelled out in that particular report that it was lawfully okay for the government to make grants to, or to send money to, Crown corporations, and that's what this government did. I assume the $45 million was not an illegal payment. I assume it was what the text of section 43 of the Financial Administration Act calls a disbursement from the consolidated revenue fund that is "lawfully authorized to be made."

There we have a situation where the government can pay unlimited amounts of money out of the consolidated revenue fund to Crown corporations. There's nothing to stop this government from making a disbursement from the consolidated revenue fund in the amount of, say, $300 million, or whatever the amount of indebtedness of B.C. Rail for the building of the Anzac line; from making a disbursement, from writing out a cheque for S300 million, out of the consolidated revenue fund and sending it to B.C. Rail to cover up the real costs of building that Anzac line, and then to say: "Oh, well, now we have to borrow the $300 million by way of treasury bills." That is unlimited authority to borrow money, no matter which way you cut it and no matter what the minister said.

The minister's attempt to delude this House into thinking there is a limitation is just a lot of froth and nonsense, and the minister knows it. I would have thought his sense of integrity would have prevented him from making such a patently inaccurate statement. Obviously the Minister of Finance thinks it's much more important to support the contentions of Social Credit than it is to support his own inner-felt honesty about his own position. It is unlimited borrowing for unknown and unspecified purposes. There's nothing whatever to stop the government from transferring money to B.C. Buildings Corporation. They've already done that with B.C. Rail. They have already taken the action of spending $45 million of taxpayers' money for an unspecified purpose.

AN HON. MEMBER: Fiscally impotent.

MR. HOWARD: Fiscally irresponsible. It may be fiscally impotent, but certainly not debt-oriented impotent.

The've already taken 45 million bucks of the taxpayers' money and sent it to B.C. Rail for an unspecified and unknown purpose. Ask Mae Norris, president of B.C. Rail, what he did when he got hold of the cheque. There was no covering letter or memo, no telephone call to say: "Mac, we're sending you $45 million. We'd like you to use it for, you know, whatever purpose." Just a cheque in the mail, for an unspecified purpose. Subsequently, B.C. Rail decided what they were going to do with it. They put it into the bank and entered it in their books, I believe as "contributed surplus." With it, they are going to buy down the interest charged on the money currently being borrowed to build the Anzac line, so that at the end of building that Anzac line the cost of interest, which is a normal cost of doing business, will not show up on the books. It will be a cooked-book arrangement. for which this government is noted. There is nothing whatever to stop this particular government from transferring money to ICBC for unspecified and unknown purposes and then saying: "We are now short in the consolidated revenue fund. We haven't got enough money to pay social assistance so we're going to borrow money to pay social assistance." The real culprit in that would be the decision of this government to send money to ICBC in order to create a vacuum of funds within the consolidated revenue fund. Then they would borrow for the other purposes, but they would have created the shortfall, just the same as they created a S45 million shortfall in funds by sending that cheque to B.C. Rail.

The amendment, as I said, is reasonable. Let me read it again, though it has been moved: "It is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money which may be raised by borrowings under the Financial Administration Act." The minister opposes that. In voting against that particular amendment, what this minister and this government will be doing, Mr. Speaker — and mark it clearly in the record for all time to come so the people of this province will know it — is voting against not only the concept of the limitation on borrowing but against the actual declaration. The motion says positively and clearly that it is not in keeping with proper fiscal policy to have no

[ Page 9434 ]

limitation on the aggregate amount of money which may be borrowed under the Financial Administration Act. The government, if they vote against this, will be saying it is proper fiscal policy to have the authority for unlimited borrowings; it's proper fiscal policy to go in the same direction that the MacEachens, the Trudeaus and the Lalondes have driven us in this nation; it's proper fiscal policy now to endorse the declaration of the Premier of this province when he went to Ottawa and said: "Right on, Mr. Trudeau, high interest rates are the thing that we need in this nation."

That Premier said this, and this government and this Minister of Finance, if they stand up later on when we get to a vote on this particular amendment and vote to defeat it, will basically be voting to support the high interest rate policy of the Liberal government in Ottawa. That doesn't surprise me; their Premier said that's what they should do in any event. He told Trudeau that's what he should do. This government, by voting against this particular motion that is before us, are saying they want to start this province on that long, slippery, downhill slope to bankruptcy for this province; that they want nothing better and nothing more than to be able to borrow and borrow and go into debt for unlimited amounts of money — even into debt for the purpose of paying interest on money that's already borrowed. That's what we'll be doing.

For the last few years this government, by way of the glorious baritone declaration of the Minister of Industry, have said that it's proper fiscal policy to give $70 million a year to B.C. Rail. That's in addition to the $45 million special on March 31 of this year. What's that $70 million a year for, Mr. Speaker? The $70 million is so B.C. Rail can pay the interest on the some $800 million that it already owes. B.C. Rail is technically a bankrupt corporation. B.C. Rail does not generate sufficient income to pay the interest on its $800 million debt. It can't do it. It doesn't have the resources to generate that kind of income. So we're paying them $70 million a year so that B.C. Rail can pay the interest. Under this particular bill, by paying that $70 million to B.C. Rail to pay the interest on its existing debt, without counting in the current debt being accumulated to build the Anzac spurline, that will be a shortfall in the general revenue fund of $70 million. This bill will authorize the Minister of Finance to go down in the basement, start up the printing-press, and chum out $70 million worth of treasury bills in order to pump that money back into general revenue. That is borrowing money to pay interest on money that is already borrowed — the most heinous fiscal crime that can be created, the most sinful fiscal thing that can happen, yet this government wants to take us along that particular route. The government, certainly by voting against this motion, will vote against its principles, its philosophy and the actual words itself. Even more than that, they will, by their action of voting against the motion, which really only says that it will put a limitation on the amount of money that can be borrowed.... "Not a dime without debate" — put a limitation on it, level with the general public, tell them how much you've squandered this year that you need to borrow. Put a limit on it; disclose to the general public what it is. That's all the motion asks. The government, by voting against that, will be voting for secrecy, for a denial that the general public should have access to that information. It will be voting against the principal concept of accountability, a word which the minister used so profusely in his previous budget speeches but which I notice he has refused to use during this debate, because this is the bill that doesn't have anything to do with accountability; it has to do with a lack of accountability. We need to put this in the context....

MR. KING: He's embarrassed.

HON. MR. CURTIS: No.

MR. HOWARD: No matter how many times the minister says no, this is not unlimited borrowing....

Interjections.

MR. HOWARD: Well, I'm not concerned about his byplay of words with my colleague here. That's between those two honourable gentlemen, one of whom I know for sure is honourable — my friend from Shuswap-Revelstoke (Mr. King) — and the other of whom I have grave doubts after the introduction of this particular bill.

DEPUTY SPEAKER: Order, please. That statement cannot be allowed. Hon. member, all members in this House are honourable. Any personal reflections can not be allowed.

MR. HOWARD: Oh, I don't doubt the honourableness. I just say I have doubts about it.

DEPUTY SPEAKER: That still casts a personal reflection.

MR. HOWARD: All right. There's no need for me to hesitate at all, Mr. Speaker.

Interjections.

MR. HOWARD: Brutus was an honourable man too.

DEPUTY SPEAKER: I'll ask all hon. members to come to order, please. The member for Skeena continues on the amendment.

MR. HOWARD: Mr. Speaker, all members in this chamber are honourable, even those who sold out the interests of the party to which they used to belong to join Social Credit; even those who have abandoned their own party; even those who said to the party that got elected — I don't know what they said to them, but even those who thumbed their nose at the party that got elected and moved over for political convenience and political payoff. Even those honourable gentlemen, are honourable in this chamber.

DEPUTY SPEAKER: Order, please. To the amendment.

MR. HOWARD: What surprises me is that a person with the background and the adoration that he had — and still has — for Conservative Party principles and philosophy would stand up in this House and say that he intends to vote against a motion which says simply that it is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money which may be raised by borrowings under the Financial Administration Act. That's a beautiful declaration, Mr. Speaker, a beautiful principle to abide by, and one which a true Conservative would support, one which a true Liberal would support — a provincial Liberal, that is, but we don't have any. Ask Shirley McLoughlin.

[ Page 9435 ]

MR. KING: They all bailed out.

MR. HOWARD: They all sold out.

This reasonable amendment relates to the bill, and the bill relates to sections 42 and 43. Let's see what that says. Section 42 says: "Subject to the act that confers the borrowing authority" — in this instance, that's this particular act, the one he's seeking to function under — "the Lieutenant-Governor-In-Council may authorize the Minister of Finance to borrow sums of money that are required for the repayment of any securities issued by the government, other than under section 43, that are maturing or have been called for redemption." Now the bill seeks to take out the words "other than under section 43." Section 42 is the rollover clause. That says that if the Minister of Finance has borrowed money and it's maturing, say, on this particular day or any particular day in question, then the Minister of Finance can borrow further money to retire that debt. In other words, he can keep that debt rolling on forever, for an unlimited period of time.

[Mr. Speaker in the chair.]

That's what the federal government does. There's an item in the paper today that the federal government is going to go to the market, I think, in the middle of October to borrow some hundreds of millions of dollars, part of which will be to retire debt which is maturing on October 15 and part of which is to stick in the pocket of the federal government. That's what this says.

This particular section says that the minister can borrow money for unlimited periods of time simply by reissuing debt and rolling it over. He can borrow $100 million today for, say, six months. Six months hence he could borrow another $100 million to pay off the first $100 million, and so on ad infinitum, and never retire that particular debt. We pay interest on it as we go along. That's what B.C. Hydro has been doing. B.C. Hydro, for instance, has never retired any debt which has matured. It has always borrowed to refinance it. It has always borrowed, in addition to money to refinance the debt, money for extra purposes.

That's what this Financial Administration Amendment Act says. Section 42 now gives the Minister of Finance the right to borrow money for unlimited periods of time, never having to pay it off and continually rolling it over for any purpose whatsoever. Whatever the particular statute the money is borrowed under, it can be rolled over. This bill sanctions that. For the minister to say that this does not give him authority to borrow money for unlimited periods of time is, I simply say, wrong. Not only is he wrong, he knows he's wrong. When he stood up in this House and said words to the contrary, he knew at that time that what he was saying was wrong, because the act is here and he drafted it and piloted it through the House. He has the unlimited authorization to borrow money for unlimited periods of time.

Section 43, the one the minister hung his hat on a while ago, says: "Where it appears to the Lieutenant-Governor-in-Council that the consolidated revenue fund will be insufficient to meet the disbursements lawfully authorized to be made from it, the Lieutenant-Governor-in-Council may authorize the Minister of Finance to borrow, for a period not exceeding 365 days" — those words are to be struck out — "an amount not exceeding an amount the Minister of Finance considers necessary to ensure that the consolidated revenue fund will be sufficient to meet those disbursements." He can borrow money for 20 years under this. It doesn't talk about treasury bills in here. It just says that where it appears that the consolidated revenue fund will be insufficient to meet the disbursements lawfully authorized to be made from it, the Lieutenant-Governor-in-Council may authorize the Minister of Finance to borrow an amount not exceeding an amount that the Minister of Finance deems necessary. He can borrow for 20 years, 25 years, or who knows what period of time.

That section, with the restriction of 365 days proposed to be removed from it, connected with section 42, confers upon this minister unlimited borrowing powers, just as Pierre Trudeau has unlimited borrowing powers, just as the Minister of Finance in Ottawa, Marc Lalonde, has unlimited borrowing powers, and just as Allan MacEachen before him had unlimited borrowing powers. This minister wants to get this province into the same condition that his Liberal friends got the federal government and the people of Canada into, because they follow the principles set out by the Premier of this province when he went to Ottawa a few years ago. The Premier of this province a few years ago not only advocated high interest rates as the way to go; he also advocated to the federal Government that deficit financing was a reasonable way to go as well.

HON. MR. CHABOT: How much longer?

MR. HOWARD: "How much longer?" the Provincial Secretary asks. How much longer is this crowd going to stay here, destroying this province? How much longer is this government going to stay here, driving us into a depression, and driving us into bankruptcy? Oh, what an appropriate statement for the Provincial Secretary to make. That's what the people of this province want to know: "How much longer?" The sooner you go, the better. The sooner the Premier screws up enough courage to visit whomever he visits to get this writ and brings this....

Interjections.

MR. HOWARD: He doesn't know. That's right, I don't think he knows. This cabinet was the last to know about the redistribution bill, Bill 80, and this particular bill and the amendment before us....

Notice the sequence of events with respect to the particular bill to which this amendment relates. The Minister of Finance came into the House ten minutes before 6 o'clock that evening, in a very subdued fashion, his shoulders slumped and his head down. He stood, not in his usual brave fashion of looking Mr. Speaker right in the eye, proud and honest about what he was doing, but in a cowed fashion — cowering — and said in a tremulous voice: "I have a message," etc. And when he introduced the bill, did you see any of his colleagues applaud? Not one of them. They hung their heads in shame, those few that knew about it. And when the Minister of Finance went out he scuttled down the corridor, like a crab on the bottom of the ocean trying to escape from a ling cod.

HON. MR. PHILLIPS: Get the net.

MR. HOWARD: You bet, Mr. Minister, you need the net.

There he was. refusing to talk with the press, saying: "It's all in the press release." What a shameful display by that former Conservative — he probably still pays his dues to Joe

[ Page 9436 ]

Clark's outfit. And when the Minister of Finance and the Premier stand up in this House, whenever that event will come about, and lead their troops to vote against this particular amendment, they will be insulting the people of this province. They will be saying yes, they want unlimited borrowing powers. Not only is this government pleased with the fact that it drove this province into a depression; it now wants to drive it into bankruptcy as well. That's what they will be voting for if they vote against this reasoned and reasonable amendment.

MR. COCKE: One member on the government side got up and challenged this amendment, opposed this amendment, and that member was the Minister of Finance. He assured this House that everything will come before the Legislature; that the bill now before us will not in any way inhibit the Legislature. Why then are we discussing this bill? The Legislature is always at the pleasure of the Speaker, and the Minister of Finance has seen fit to depart — briefly. The Legislature is always at the call of the Speaker; we are prorogued only once per year, and that prorogation is followed by the opening the next day. We are in recess, and we can be recalled to discuss any kind of amendment to the budget or any kind of new legislation requiring financing. No, that's not what they want. We have given the Socreds an opportunity here with this amendment at least to carry on with part of their tradition. That tradition has been not to go into debt for operating expenses. Further, there should be at least the opportunity for debate on any debt incurred. What we're asking for is a limitation on the borrowing. I think that's fair enough — just a limitation on the borrowing.

Mr. Speaker, I called yesterday for a limitation on the time as well. But in any event, what we're asking for here is for a limitation on the aggregate of money. If the government would come to the Legislature and say, "We need X dollars for these purposes," who's going to argue? At the present time we have before us a bill saying that the Minister of Finance has the right to go out and issue treasury bills, which means that he has the right to go out and borrow. He says: "But don't you worry, as long as we're in session, it will all come before us. And if we're not in session, the report must be made 15 days thereafter." Yes, we all know about that. One of the things we've got to remember is that this government, of all governments in this province, has been absolutely famous for their special warrants. Just in case there is somebody in this House that doesn't understand what a special warrant is — and I suspect that some of the backbenchers on the government side do not understand what they're doing in supporting this bill — the special warrant is where the government, when we're not in session, passes an order-in-council that provides that government with the money they need over and above the money that was voted by the Legislature. This bill, without this kind of an amendment, Mr. Speaker, gives them the right to issue special warrant after special warrant after special warrant. Sure, within 15 days of the time the Legislature is called back we can raise Cain about the special warrants, but the money has been spent. There is no debate before the fact; that's what we want.

We debated a budget. When we debated that budget in this House our finance critic said that it was a fallacious budget, that it didn't represent the needs of the government, that the revenues were improper in terms of his projection of revenues, and that the expenditures were out of whack. Why then, when we were called back his fall, weren't we asked to debate an amended budget? We were asked to debate a bill that provides the Minister of Finance with an opportunity to do what I said yesterday, Mr. Minister, through you, Mr. Speaker: just to write cheques for as long and for as much as you wish. Oh, yes, the auditor-general's going to get a look at it after the fact; the Legislature's going to get a look at it after the fact. That's not what the Legislature is charged with in terms of its responsibility, in my view. A legislature should be discussing what will be happening down the road.

The Premier makes vague reference to the fact that he wants this for some of his interest reduction program. Why doesn't the government bring in a statute that's less vague than the one they did bring in, that gives the sums that they wish to spend?

HON. MR. GARDOM: You don't agree with anything we do.

MR. COCKE: Oh, the poor House Leader is frustrated because we don't agree with anything they do. Yet the Socreds are complaining that we have been supporting some of the legislation that they've put forward. Be consistent, will you?

HON. MR. HEWITT: How come your shirt's blue and your collar's white?

MR. COCKE: My haberdasher ain't the same as your haberdasher, I guess.

HON. MR. GARDOM: Are you going to Madame Runge's too?

MR. COCKE: No, I go down to sales at the Salvation Army.

HON. MR. CHABOT: I like your shirt. I think it's a nice shirt.

MR. COCKE: Thank you.

Mr. Speaker, the motion that's before you is a motion that gives the government an opportunity to at least state that there's going to be some accountability here. Is there anything more that we can ask than for a government to be accountable to the Legislature? Isn't that what democracy is all about? Isn't that the reason that we're here and elected on either side?

HON. MR. RICHMOND: Let's go to the polls, Dennis. Are you ready?

MR. COCKE: Oh, am I ever ready! The Minister of Tourism says: "Let's go to the polls." Oh, I pray that we go to the polls! Let's resolve this stupidity. If it were in my authority to whip up to Government House right now for the writ, I'd be on my way. There'd be a taxi waiting at the door. No, the Premier has hopped around like a chicken on that issue, and nobody seems to know what he has in his mind, other than the fact that we've been standing in this House debating different bills ad nauseam, and then we come to an important amendment like this, and what do we do? Suddenly we don't hear from the government. I can understand the embarrassment of those members and those ministers. There is no question that they're embarrassed. Probably

[ Page 9437 ]

many of them are surprised that the Minister of Finance and the Premier should bring in a bill that is a blank cheque, a bill that can afford them the right to go down into the basement and print treasury bills to their hearts' content and sink us ever deeper into an economic quagmire.

Here's a little bit of light on this particular situation. The light is that they will stand up and say that there shall be a limitation on borrowing, a limitation of the aggregate amount. The Provincial Secretary (Hon. Mr. Chabot) says: "How much?" He knows perfectly well that if the opposition had put in how much, it would have been out of order. We're giving you an opportunity here to vote on a principle.

Interjections.

MR. COCKE: Mr. Speaker, they have had their opportunity ad nauseam. How long have we been here? We've been here discussing, day after day after day, bills with no real substance, bills that don't tell us how much they expect to expend on assistance to small business, assistance to mortgage holders, and so on. So what they do is they bring in another bill that says the sky's the limit. What a change in this province! What a change from the W.A.C. Bennett days! Also, what a change from the early days of the new Premier — relatively new who used to run around this province screaming: "Not a dime without debate." Now he wants us to give him all the dimes in the world, all the dimes that can be created without anything more than the debate on this particular bill.

When the Finance minister comes into this House and tells us, "Don't worry, everything has to go before the Legislature," I just have to quiver. Sure, everything will come before the Legislature — after the fact. There'll be special warrants issued after this bill, Mr. Speaker, that will make confetti go out of style. The air will be full of special bills and warrants allowing every one of those ministers, who have proven to be spendthrifts over the last six and a half years.... And they expect the opposition to stand back and acquiesce to a bill without any accountability whatsoever, other than accountability after the fact.

Let me give you a scenario: If this bill goes through, and there's an election, and by some awful circumstance they squeak back in....

HON. MR. HEWITT: Sweep.

MR. COCKE: There will be no sweep from your side.

MR. KEMPF: We'll sweep you right off the map.

MR. COCKE: Brave words. Why haven't you dropped the writ?

Let's say they did squeak back in. For the next five years they would have an opportunity to do whatever they like. Also, during an election campaign they can use — what they've been doing up until now — public funds to further their own cause to the extent they wish. Oh, yes, we get hack here next spring, and within 15 days of the first sitting of the Legislature the accounts must come forward. Then we can look at them and say: "Tut, tut." We can look at those accounts and say: "You spent unwisely." But that's going to be a lot of good. That's going to provide the public with a tremendous amount of confidence in our system, isn't it. What we're asking for here is that we don't go the route of the federal Libs — spender, spender — and then come back and tell the folks: "Sorry, we're $20 billion in the hole."

What they're telling me every time I go back to New Westminster is true.

Interjection.

MR. COCKE: Twice a year. I live in my constituency. Where do you guys live? Listen to Omineca telling me something about going back. He went back to his constituency once in the last two or three months, and he made a big report in the Legislature. When he did get there for the first time in two or three months, his constituents said: "Please go back to Victoria."

MR. KEMPF: Come and run against me then.

MR. COCKE: Why don't you come and run against me? You're spending all your time in the south.

I have trouble with the member for Omineca. I suspect that he may not even like me. It's so devastating that I have difficulty sticking with what I'm trying to put across with respect to what we're doing here. What we're doing here, as an opposition, is affording the government members an opportunity to say yes to accountability before the fact. We would prefer, rather than either this amendment or the bill itself, that the Finance minister get up and provide us with an amended budget so we could say okay or, on behalf of the people, nay, Yes, that would be accountability. We have no accountability whatsoever in this legislation.

[Mr. Strachan in the chair.]

Interjections.

DEPUTY SPEAKER: Order, please. I'll ask the minister to come to order.

MR. COCKE: The word "bankrupt" came out of the Minister of Intergovernmental Relations (Hon. Mr. Gardom's) mouth. I agree that probably he is concerned about bankruptcy. Under the administration of the present government, this province is in the worst economic shape it's been in for probably 40 or 45 years. Under their administration, we are placed in a position where we have to bring in legislation about which each government member who has got up and spoken has said: "I deplore" — or words to that effect — "what we're doing here."

Those government members who have said that could very easily stand up in the House now and say: "Yes, we agree with this recent amendment." If they did that, it would strike me that the Minister of Finance would back off the whole thing and come in here with legislation giving us estimates of expenditure. That's the least we can call for on behalf of the people we represent. The very least we can call for is that kind of accountability — accountability that happens first, not after, an accountability that is so absolutely important in our system.

Arrogance is what we have seen. It's arrogance that stems from the kind of opinion that. "We know what's best for everyone in this province, and the devil take the opposition." They were mildly surprised that we raised a little bit of cain about the legislation they put forward. How can they be mildly surprised that we would be angry about that kind of

[ Page 9438 ]

legislation from a government that issues special warrants like they're going out of style? That's exactly what they want from this bill, and that's why we would like to see some accountability in it, whereby the Minister of Finance says that we are going to spend this much on thus and so. Is that asking too much in a system that demands it? Yet they're trying to circumvent the system, like Brother Pierre has been doing since 1968.

Interjections.

MR. COCKE: There's a myth abroad. That Minister of Highways (Hon. Mr. Fraser) said that Leggatt helped them. The NDP has traditionally voted against Trudeau about five times as much as Clark has.

Interjections.

MR. COCKE: Read Hansard. You're an illiterate bunch. The only people who keep supporting Pierre Trudeau are the provincial Socreds here in Victoria.

Interjections.

MR. COCKE: That is not baloney, my friend. It is accurate, and you know it. Every time we say it you guys go absolutely hysterical.

Interjection.

MR. COCKE: Precisely — the place is full of Liberals. Pierre has more agents....

MR. KEMPF: On a point of order, the Leader of the Opposition, after two weeks, is now in the chamber. It looks as though he wants to say something. Please give him the floor.

DEPUTY SPEAKER: That is not a point of order. Since we have had this brief interruption, perhaps I could recommend to all members of the House that they not interject while another hon. member is speaking. To the hon. member for New Westminster, we are on an amendment to Bill 86.

MR. COCKE: Mr. Speaker, I'd like to apologize to the House. The Liberals are all in the cabinet here. I'd forgotten that the back bench hasn't got very many Liberals.

What we are seeing here before us is identical to the kind of liberty taken with public funds that we have seen in Ottawa, and as far as I'm concerned, if that isn't convincing enough, I don't know what is.

I believe that what the members opposite should do is carefully reconsider what they did at the outset when they introduced the bill, and further, carefully consider the opportunity for accountability that we have given them with this amendment to the motion. The amendment to the motion for second reading on this bill is clear. It's clear because it says that there should be limitation on the aggregate amount. It's clear that the opposition is now calling for accountability before the fact. It's clear that the government is not comfortable with what they have done. Here's an opportunity for them to put it right. Here's an opportunity for those members on the back bench who were crying out, saying: "We don't like what we're doing, but somehow or other we have to do it." Have to do what? An open sesame! I'll tell you, after having sat in this House for six and a half years, just with these people, watching the antics and watching the expenditures — high, wide and handsome; no restraint in terms of their expenditures....

HON. MR. BRUMMET: All this summer you were against it.

MR. COCKE: We made that very clear, didn't we.

All we would like to do to see some restraint in this province is put a straitjacket on the government, and then we'll see some restraint. The government picks on one section of society after another, and then expects applause. That outspoken member from the north, who probably now is defrosting, would do well to consider this amendment, because there is accountability in this amendment and absolutely no accountability in the bill itself.

Mr. Speaker, I implore the members to support this amendment to second reading of the bill. Thank you.

MR. LOCKSTEAD: Mr. Speaker, I appreciate....

Interjection.

MR. LOCKSTEAD: The minister asks me to read the amendment, and I'll do just that. I appreciate this opportunity to take my place in this debate.

The amendment is very simple: That the motion for second reading of Bill 86, entitled Financial Administration Amendment Act (No. 2), 1982, be amended by deleting all the words following the word "that" — are you following this — and substituting therefore the following: "It is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money which may be raised by borrowings under the Financial Administration Act."

What that means, Mr. Minister, is that in our view this bill undermines the very essence, the very spirit, the very principle of the parliamentary and democratic policy and systems that we're accustomed to operating under in this province and in this country. That's what this bill does. There's no accountability. If this bill passes there'll be no accountability to this Legislature, and thereby to the people of this province, for what the government is going to do, how much money they are going to borrow and for what purposes. That basic principle is being undermined in this Legislature this morning by that government.

HON. MR. FRASER: You're insulting the public accounts committee.

MR. LOCKSTEAD: No, I'm not insulting the public accounts committee.

Yesterday in this House the Minister of Forests said we're voting for the legislation on mortgage assistance, we're voting for the legislation on small business development assistance. We're voting for those bills, as Mickey Mouse as they are, because they may help some people. When we form the next government of this province, those bills will be amended to assist the people who really need assistance. The Minister of Forests said yesterday: "Where do you think we're going to get the money if we don't have this bill?" One place they may consider getting money for those programs, and for education and hospitals as well, restoring the health care for

[ Page 9439 ]

people in this province, is the $82 million the government ministers voted themselves this year over and above last year for ministerial office space, ministerial travel and ministerial propaganda. That's one place the money might come from. That's one area that we could look at. While they spend taxpayers' money for their own entertainment and travel, they're cutting back on the quality of education in this province and on health care. Now they want us to pass a bill in this House so that in the secrecy of the cabinet room they can make these decisions that affect every person in this province.

Look at their record. In 1975 the total debt of this province was under $4 billion. This was a debt incurred by our various Crown corporations: B.C. Hydro, B.C. Rail and others. The direct debt to the taxpayers in this province today through the Crown corporations totals some $12 billion. That government has plunged us into debt. That means that every man, woman and child, every person in this province, owes somebody — marketing interests, I suppose, on Bay Street and in New York, and God knows where else in the world — some $4,000. That is the amount currently owed by every person in this province as a result of that government's fiscal mismanagement. I think they're taking lessons from Ottawa on how to mismanage our money. That's what they're doing.

HON. MR. FRASER: Tell us about the finances of Nanaimo Commonwealth. We want to hear about that.

MR. LOCKSTEAD: Want to hear about my own finances? I'll tell you, they're pretty grim.

DEPUTY SPEAKER: I'll ask the hon. Minister of Lands, Parks and Housing (Hon. Mr. Brummet), the hon. Minister of Transportation and Highways (Hon. Mr. Fraser) and other members who are interjecting not to interrupt the speaker.

MR. LOCKSTEAD: Thank you, Mr. Speaker. In 1960, the former Premier of this province, Mr. W.A.C. Bennett, passed the loan authorization cancellation act. In that bill, chapter 27, An Act Respecting the Cancellation of Statutory Authorizations for the Borrowing of Money by the Province, the then Premier of this province listed some 30 statutes — I won't go through the list at this time — that specifically put a limit on the borrowings of all of these ministries, Crown corporations and what have you. Here we are today with the son of W.A.C. cancelling that bill. He's going in exactly the opposite direction of what the Social Credit government has been telling us for years is their philosophy. Now, in the secrecy of the cabinet room, they want to be able to borrow all the money they think they might need for whatever purpose, because we'll never know the facts in this Legislature.

Interjection.

MR. LOCKSTEAD: The Minister of Transportation says that we're opposed to both. We're not. What I plan to do is send that minister a copy of our 26-point program on how we're going to get this province back on its economic feet again. Hopefully, within the next month or two we'll have that opportunity, if that Premier over there ever has enough guts to drop the writ. I don't think he has, quite frankly. He's afraid to go to the people. He doesn't want to be unemployed.

Interjections.

DEPUTY SPEAKER: One moment, please. I'll ask all members to not interject and interrupt. And the member for MacKenzie is well aware that personal allusions are unparliamentary.

MR. LOCKSTEAD: I just wanted to be on record as opposing this bill on the basis that it's undemocratic, unparliamentary and abhorrent to the parliamentary nature of our society, province and country. I particularly want some of those backbenchers over there, who should be taking their places in this debate to defend the democratic system that we enjoy here in British Columbia. They're not getting to their feet on this amendment, but hopefully they will vote for this amendment.

MR. BARRETT: We are debating an amendment to a bill that would allow unlimited borrowing, without any scrutiny by this House between budgets delivered in the House, and that unlimited borrowing could be financed before a budget was presented to the House. The wording to this amendment says: "That it is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money which may be raised by borrowings under the Financial Administration Act." What the amendment says is that the taxpayers should have the right to put a limit on the amount of money that any government borrows, and the accountability of that limit should be re-addressed to this Legislature.

My good friend, the member for New Westminster (Mr. Cocke), made an interesting observation, and I think it's worth evaluating. It's certainly not appropriate to the Minister of Highways (Hon. Mr. Fraser). He's been a Social Credit member all his life, except for that little flirtation he had with the Tories. The flirtation with the Tories was overcome by a simple word known as "opportunism." That's not a major handicap to a politician: jumping from political bed to political bed, finding a comfortable down pullover, as the minister did. I accept that minister's comfort with Social Credit, but an examination of those Liberal jumpers and where they are now, debating this amendment, brings one to remember — as old as I am, and as ancient as I am in British Columbia politics — to remember that the last time we debated a bill like this was when the Liberals were in the last coalition in this province.

Yes, it was pure Social Creditism that kept this kind of legislation away from the House. But there are five former Liberals now sitting in that cabinet. They are sheep in sheep's clothing, and they have been exposed as the ones who are fostering this massive debt. They're going to try to spend their way into prosperity, based on loading debt onto the people of British Columbia. Never before, in the memory of the old Socred cabinet minister, would this kind of bill be allowed to see daylight in this Legislature. I find it interesting that the most fervent exponents of this particular kind of debt move are those Liberals sitting in that cabinet, masquerading as Socreds.

The last coalition in this province was debt-ridden. The last coalition was swept out of office because there was no accountability through financing, by an old device that we thought ended with the Magna Carta. Do you know what that old device was, tucked away here in the colonies of British Columbia, out of the scrutiny of the Mother of Parliaments? It was known as the secret order in council. Who was it who

[ Page 9440 ]

campaigned against the secret order in council, piling up massive debts inspired by the Liberal coalition of that day? It was W.A.C. Bennett.

I sat in this House for 12 years opposed to W.A.C. Bennett, both in opposition and in government.

HON. MR. FRASER: Too long.

MR. BARRETT: Yes, it was too long. He should have gone a couple of elections earlier. Had he done so, the Social Credit Party would not have been destroyed by this moribund band of coalitionists masquerading under Social Credit today. That once proud party may have still been here in British Columbia had he gone one election earlier. Yes, he hung on too long, and the Liberal infiltration became successful, and that Liberal gang now controls the government.

I like the Minister of Highways saying "too long" because it is a revelation that he himself knows that it was okay as a Tory to jump into bed with the Socreds, but the bed got crowded when the Liberals started moving in. How do they do it? Is it an insidious international plot by Liberals to take over everywhere? They put a toe in, then an ankle, then an arm and then the whole body, and then they change their accent when they become ministers.

MR. LEA: I heard they got the Socreds drunk.

MR. BARRETT: However they did it, 30 years ago in this province we had a Liberal coalition government that came in with this kind of legislation for unlimited borrowing. They were thrown out of office, because if they went to the secret order in council.... Thirty years later we have the same Liberal reckless gang coming in with secret orders in council to borrow money and pile debt upon debt.

MR. HOWARD: But Hughie's a Conservative.

MR. BARRETT: He's only an instrument. That minister belonged to the Conservative Party, to Action Canada and to everything in which he could step up the ladder to his self-imposed measure of success. Today he's the author of the demise of Social Credit philosophy and principles.

Mr. Speaker, this amendment asks for one simple measure of accountability. Like any marriage, the marriage between the taxpayers and the government must encompass honesty, cooperation and trust. This government is, asking that the marriage between government and the taxpayers become one-sided and that only one side, the government, will know how much money is in the family budget, how much we owe and how much is going to be spent on any given program. All the taxpayer gets is to stay in the kitchen, wash the dishes and raise the kids. It is a chauvinist bill, in many senses, in its attitude expounded by dilettantes and an arrogant government presuming that its whirling dervish policies will be accepted by anybody.

This government intends to go out carte blanche and borrow money without any reference to this Legislature when, in a matter of months, they brought in a budget to this House expounding the exact opposite theory. On April 5 of this year, after a prolonged absence of seven months from this Legislature, we were finally called back, we were given this budget document by that minister and we were told everything was in order. When we proposed cuts and accountability, we were attacked as being a reckless opposition, when in fact the wrecking gang has been sitting over there destroying the economy of the province of British Columbia.

This latter-day conversion by the Bill Bennett government to the Liberal philosophy of debt on top of debt on top of debt is a direct result of too much association between our Premier and Pierre Trudeau. They held hands on a national scene during the constitutional debate, and while they were holding hands Pierre had his hand in Bill's pocket and slipped him a message: "Solve all problems by borrowing money."

[Mr. Speaker in the chair.]

This is a Liberal-inspired piece of legislation. There is a $20 billion debt this year in Ottawa alone, and what do we get as a response from Victoria? We get "me too" as a response. Let me get into the trough and pile debt on the taxpayer's back. But there's something different: no accountability; no reference back to this Legislature; no honesty to the people of British Columbia of how you're piling up debt. We're going back to the secret orders-in-councils behind the green door, where cabinet will make the decisions.

At this moment I welcome to the chamber one of the former Liberals — one of the few that the Liberal Party was glad to see go, I must say — the Minister of Universities, Science and Technology (Hon. Mr. McGeer). The minister is with us today; he deigns to give us his presence. He's just a few hours away from the formaldehyde bottles, so he can spend some time here with his tenure intact, with his security all right, He locked himself into bed with Social Credit. He sold the secret orders-in-council that he wrote against and fought against when he was a Liberal.

MR. LAUK: No cutbacks for Pat.

MR. BARRETT: You're right, Mr. Member: no cutbacks for Pat. That could be a great campaign slogan in Vancouver–Point Grey: "All you teachers out there, behave yourselves; do as the government says. All you government employees, behave yourselves." But when it comes to Pat, why, there's a suspicion of influence with no accountability.

Yes, Mr. Speaker, I repeat, it is the first time since 1952, when we had a Liberal coalition, that we've had this kind of bill in front of us. We've got a Liberal coalition back again; that's why this massive-debt bill is here.

I heard that the Premier said a few words last week about this. "Oh, rush, rush, rush," he said, like the Mad Hatter in Alice in Wonderland. This is a man whom Lewis Carroll would have described as an anachronism to consistency. Here is the man who has spread his word and gospel all over this province, in time-ritualized rhetoric and clichés: "Let us not borrow money to pay the groceries. I will never lead a government that will pile up massive debt for operating costs." Oh, no, the fountainhead of Social Credit is to make sure that we don't leave debts for our children and grandchildren. He came in last Friday, and in a 180-degree switch in policy he announced: "I now want debt. I embrace debt. Give me debt or give me liberty." The absurdity, the inanity, the hypocrisy of that switch in rhetoric was something to behold.

MR. LEA: He and Trudeau are in debt together.

MR. BARRETT: My friend has made a brilliant quip. Premier Bill, Bennett and Trudeau are in debt together. Really,

[ Page 9441 ]

I wouldn't be a bit surprised to see that as a bumper sticker within hours. Can you see it now, Mr. Speaker? We can have a whole run of movies — "if you like Trudeau, you'll love Bennett." What a disaster they've wrought! They have the Premier wound up like a mannequin by his manipulator from Toronto, standing up speaking in red, white and blue phrases, with the flag waving in the background, saying: "That's the spirit. Change philosophy, change principles, no matter what you believe, as long as the polls go along with you." You spend more money weekly on polls than most single parents get to spend in a year trying to keep their families together. You spend more money on polls trying to find out where your heads are at than handicapped people get to buy groceries.

You're not a government with philosophy or principle. You are a weak group of people clinging to power desperately because you've got nothing better to do in your lives, and not much better to offer. You came together on the basis of a grab for power. You left philosophies, just as you changed jackets, to climb into that political bed together. You took clichés and rhetoric, and ran around this province saying that you would never bring debt to British Columbia. Now you've got the unmitigated gall to not only bring in a bill to pile debt upon debt, but you also have no accountability back to this Legislature. You want to go back to the secret green doors of the cabinet room and pass your orders-in-council.

I'd love to be at a local Social Credit constituency meeting right now. I'd love to see those earnest, hard-working, serious Social Credit pioneers sitting in those rooms deciding who the brass is going to shove down their throats as a candidate because the polls say that this is a better candidate. I'd love to sit in those rooms and see those hard-working people who gave, their money, their hours and their effort, listening to the explanation given by the Premier and that cabinet as to why they've reversed their policy of pay-as-you-go to one of debt on everything.

In this very chamber, businessmen who are concerned about their own businesses going down the tube because of the economic recession.... They know better than to allow this kind of an unlimited debt to drag their businesses down, but not this government. In a shameless act of hypocrisy, Mr. Speaker, they've brought in a bill that says: "Let us borrow anything we want, anytime we want it, and we don't have to come back to the Legislature and explain what we're doing."

Mr. Speaker, it would be bad enough if there had been no warning that this was going to happen. It would be bad enough if the government found all of a sudden, overnight, that they were running out of money, It would be bad enough if this were an honest mistake by a government that couldn't count up to ten even when it took off its shoes. But this government has been warned month after month internally, in its own Ministry of Finance, of the chaos that was going on, and it blindly ignored those warnings even when they burst out into public attention.

Mr. Speaker, I have to address myself to a little bit of history on this amendment. Do we remember Lionel Bonnell? Who was Lionel Bonnell?

MR. KING: The comptroller-general.

MR. BARRETT: He was the independent comptroller general who was brought out from Ottawa to be a watchdog on public spending. A good move, a wise move, and a prudent move — the comptroller-general to be independent, as was traditional for the role in this province, whether it was under a Liberal, Conservative, Social Credit or NDP administration. What happened to Mr. Lionel Bonnell two years ago, when he expressed his concern about his independence? Why, Mr. Speaker, were we not told the truth at that time that this government was hell-bent for debt and out of control? When Mr. Bonnell brought this to the attention of the government, what did he get as his reward for being honest? He was fired.

MR. HOWARD: For being honest?

MR. BARRETT: Mr. Speaker, it became a badge of honour to be fired by this government. They fired more honest people than anyone else around.

As the warning signals became present in the community....

Mr. Speaker, are you nodding that I should ask for an adjournment of the debate? Mr. House Leader, will you accept an adjournment?

Interjections.

MR. BARRETT: Is that a surrender or an acceptance? We still get the Liberal gesture, but it's a different finger. You're the Billy Bishop of politics.

Mr. Speaker, I accept the government's invitation to tender a motion of adjournment of this debate until the next sitting of the House.

Motion approved.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 12:01 p.m.