[ Page 9587 ]

CONTENTS

Routine Proceedings

Oral Questions

Parking passes. Mr. Howard –– 9587

Mr. Macdonald

Mrs. Dailly

Rail service to Whistler. Mr. Hyndman –– 9588

Small business bankruptcies. Mr. Lea –– 9588

School Services (Interim) Act (Bill 89). Second reading. (Hon. Mr. Vander Zalm)

Hon. Mr. Vander Zalm –– 9589

Division –– 9591

Miscellaneous Statutes Amendment Act (No –– 3), 1982 (Bill 88). Committee stage.

(Hon. Mr. Williams)

On section 5 –– 9592

Ms. Brown

Hon. Mr. Nielsen

On section 13 –– 9592

Ms. Brown

On section 23 –– 9592

Mr. Macdonald

Hon. Mr. Williams

On the amendment to section 47 –– 9592

Mr. Barber

Hon. Mr. Williams

Mr. Howard

Hon. Mr. Hewitt

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

(Hon. Mr. Curtis)

On the amendment.

Mrs. Wallace –– 9594

Mr. Davis –– 9595

Mr. Skelly –– 9598

Mr. Leggatt –– 9600

Mr. Barber –– 9602

Division –– 9604

Hon. Mr. Curtis –– 9605

Division –– 9605

Appendix –– 9608

TUESDAY, OCTOBER 5, 1982

The House met at 2 p.m.

Prayers.

HON. MR. VANDER ZALM: Mr. Speaker, at noon I had the honour of meeting and lunching with Dr. Peter Bendixen, Minister of Education and Cultural Affairs of the state of Schleswig-Holstein, Germany, and also Dr. Kurt Boysen, State Secretary for the state, and Dr. Hasso Frciher von Maltzahn, the consul-general, and Heinz Pantel, the German-language adviser. Dr. Bendixen and his party are here on a cross-Canada tour seeking information. making contacts among educational officials and promoting good relationships between Canada and Schleswig-Holstein. The state has given special attention to academic exchange programs and recently sponsored a chair for Canadian studies at the University of Kiel. I would ask the House to bid them welcome.

HON. MR. FRASER: Mr. Speaker, today I'd like the House to be on their best behaviour, not that they always are. In the members' gallery today is my wife. and she has visitors who have come to see what we do over here. The visitors are Mrs. George Parsons and Mrs. Cecil Helmer from Vancouver South; Mrs. Robert Forrest, whose MLA is my seatmate — both MLAs from Point Grey are absent — and Mrs. Sidney Miller, also from Vancouver—Point Grey. These ladies are visiting the B.C. Legislature for the first time. I believe most of them have lived here all their lives. and they've come to find out what their MLAs actually do. I'd like you to bid them a hearty welcome,

HON. MR. CHABOT: Mr. Speaker, we have in the members' gallery today Mr. and Mrs. Alexander Dgebuadze. He is president of EMEC Trading. a Russian-owned company in Vancouver. They are returning to the Soviet Union shortly. They are accompanied by Mr. and Mrs. Geoffrey Edgelow of Surrey. Mr. Edgelow is a former long-time alderman of the city of Victoria. I'd like the members to join me in welcoming them here today.

HON. MR. ROGERS: This morning in committee I had the opportunity, after the House granted leave, to introduce several members of my former employer, who are here for a convention. A number of others have joined us in the gallery and I would like the House to extend a welcome to those members of the Canadian Association of Retired Aviators who are here today. Most of these Gentlemen served Canada with great distinction between 193 and 1945. and then went on to serve, until their retirement, in the transportation of passengers in this country. I would suspect that at one time or another each and every one of you has been a passenger of ours.

Oral Questions

PARKING PASSES

MR. HOWARD: I'd like to direct a question to the Deputy Premier. Can she confirm that her Vancouver–Little Mountain constituency office mailed several hundred forged parking passes to local residents in a crass and illegal effort to buy votes?

MR. SPEAKER: The Chair would have some difficulty, hon. member, in strictly ruling that question in order.

However, the Deputy Premier may wish to answer the member.

HON. MRS. McCARTHY: The wording of the question is indeed rather doubtful as far as protocol in the House is concerned, but considering, that it comes from the member for Skeena.... I can well understand its being asked from that quarter.

The members who represent Vancouver–Little Mountain constituency — my colleague and myself — did mail to our constituents, and in service to our-constituents, some information and a message. I would like to quote from the message.

"In addition, we have produced some visitor identification cards for your visitors. When we discussed this with the police department and the city engineer's department. It was thought that this kind of card could be easily copied. That is quite true. However, you will know when you have visitors at your home, and if you see a card with your street number on it and you know you don't have visitors. then all you have to do is report that to the same telephone number and that party will be dealt with. We hesitate to think that people will go out of their way to end-run the system. However, that possibility is there."

Giving that paragraph was to ensure those who received the information in the Vancouver–Little Mountain area, where a parking problem was thought to be a concern....

It has two ramifications. It would give those residents the opportunity to have visitors to their home not be disturbed. In speaking to the super intendant of police since the information went out, he tells me — and I'm assured — that the police department of that city will not be going around picking up vehicles at any rate, and that they will not be in danger of having cars impounded.

I don't know why the members of the NDP opposition would be so concerned with the members for Vancouver–Little Mountain giving a service to those people in the constituency of Vancouver–Little Mountain. I think that is perfectly within the realm of a Member of the Legislative Assembly serving the community they serve well. I also want to suggest that we at no time suggested that these were legal cards, but that they would be a service to those who would perhaps have a visitor to their home disrupted because of the fact that the area is determined by resident parking reservations. We thought it would be of some service to them. If it offends the members opposite, let me say that it has not offended the community. We have had very many people in the community thanking us for the kind of service we have given, not only on this subject but on many other subjects of concern brought to our attention in our constituency office.

MR. HOWARD: Mr. Speaker, we're not dealing with protocol matters in the House. We're dealing with what are loosely termed — "illegalities." Can the Deputy Premier confirm that following her being caught out on this particular issuance of these forged parking passes, several innocent people have had their cars towed away as a consequence of using those passes?

HON. MRS. McCARTHY: Not only can I not confirm that, what I can confirm is that the community is not suffering either from people parking in the area as was heretofore thought. In the months preceding the building of the hospitals

[ Page 9588 ]

and the complex in the Vancouver–Little Mountain constituency, with the Shaughnessy, the Grace and the Children's Hospitals, it was thought that perhaps there would be an overloading of the community. My colleague and I from Vancouver–Little Mountain had worked to have the "residential parking only" designation put in that area. I can confirm that it is working and that there has not been an overloading of cars in that area as everyone had thought. This extra precaution, I think, has been helpful to the constituency and of service to them.

MR. HOWARD: It's interesting to note that the Deputy Premier refused to answer the question. So that the general public will know all that's going on, has the Deputy Premier decided on any other novel law-flouting tricks to be issued through the magic of her local constituency office or counterfeiters?

MR. SPEAKER: The question is not in order.

HON. MRS. McCARTHY: I don't think that that question deserves any kind of answer, and coming from the member who has just asked it, I would suggest that he is completely out of order in his questioning.

MR. MACDONALD: I'd like to relieve the Attorney General of the big smile on his face and ask him whether he approves parking passes that are not authorized by the parking regulations for the use of visitors on the streets in Vancouver contrary to the advice that had been given on that subject by both the police and the authorities of the city of Vancouver. Do you approve of parking passes being issued by a political party to the public? The answer is no, because the smile has disappeared. Of course it's illegal.

HON. MR. WILLIAMS: The smile disappeared because I was about to burst into laughter at the idiocy of the question posed by the second member for Vancouver East.

MR. MACDONALD: That gives me a very modest supplementary, then. Does the chief law officer of the Crown approve of parking passes being issued by political parties?

HON. MR. WILLIAMS: The matter of the approval of parking passes would fall under the bylaws of the city of Vancouver. It would be dealt with by the mayor of Vancouver, the city of Vancouver police, the police board and its enforcement officers.

MRS. DAILLY: I have a supplementary on the same question to the Deputy Premier. In view of the fact that when the Deputy Premier of this province, or a representative of hers, went to see the police about issuing these passes she was told by them that it would be illegal, would she explain to this House whether Social Credit cabinet ministers have special laws for them that don't apply to the rest of the public?

HON. MRS. McCARTHY: The member who just asked the question has predicated it on an assumption that is not true. I was not told that they were illegal.

RAIL SERVICE TO WHISTLER

MR. HYNDMAN: I have a question for the Minister of Industry and Small Business Development in his capacity as the minister responsible for B.C. Rail. The topic is of particular interest, with the ski season approaching, to young skiers on the lower mainland, skiers of modest income and tourist visitors who are skiers. Having regard to the continuing uncertainties of the weather and road conditions on Highway 99, would the minister consider giving to the directors of B.C. Rail a fresh directive to look at methods of upgrading rail service between Whistler and Vancouver for the forthcoming ski season?

HON. MR. PHILLIPS: In answer to the member's question, I realize there are literally tens of thousands of skiers flocking from all over the world to that great resort of Whistler. I will be meeting next week with some members of the board of the British Columbia Railway, and I'd be most happy to talk to them again about a special service to accommodate not only those travelers from our province but also young people flocking here from all over the world to take advantage of that great recreation village that was built at Whistler.

SMALL BUSINESS BANKRUPTCIES

MR. LEA: My question is to the same minister. The office of the registrar of companies reports that business receiverships and bankruptcies are running at four times the level of last year, and that 16 B.C. companies are being driven out of business every working day. Has the government now decided to adopt the proposal put forward by this side of the House in March for legislation similar to chapter 11 of the U.S. bankruptcy code, to provide a breathing space for business people who are beset by financial problems in this province?

HON. MR. PHILLIPS: We have at the present time some very successful seminars being put on throughout the province on how to survive in the rough economic times prevalent throughout not only the province of British Columbia but all provinces of Canada and the United States. The direct answer to the member's question is no.

MR. LEA: As I understand it, the government has decided to put on seminars to instruct the small business community on how to go broke gracefully. Has the minister received any communication from small business organizations such as the Canadian Federation of Independent Business, whose members, by the way, overwhelmingly support our position for a chapter 11-style breathing-space, asking for the kind of recommendation we're putting forward on this side of the House'?

HON. MR. PHILLIPS: I am, of course, constantly in touch with the small business community, who are very sympathetic toward what is happening in Canada. They realize that the majority of the problems are caused by the international marketplace. They realize that in British Columbia, due to the policies of this government, things are a lot better than they are in other provinces. They also realize that had it not been for the initiatives of this government, unemployment would be a lot higher — without the opportunities

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that exist through the projects presently taking place and the hope of future projects on the drawing-board. Unlike 1975, when the socialists were in power and there was no hope for the future.... They were going broke when the rest of the world was in favourable economic times. Due to the policies of this government things are not as bad as they could be.

MR. LEA: I have a supplementary, Mr. Speaker. With the statistics being contrary to what the minister has said — that we are now the highest in Canada for bankruptcies and receiverships — has the government now decided to bring back the legislation just passed, the Small Business Development Act, and include in that legislation, through amendment, the service industry, so that the service industry will at least be able to come to the government and borrow money in the same way as every other business in the province that was included in that legislation? With these new statistics, has the government decided to still leave out the service industry in this province?

HON. MR. PHILLIPS: The small business community recognizes the great measures that this government has taken to relieve some of the onerous burden of taxation that was imposed on the business community during the years 1972-75, when the socialists were government. They realize that we have relieved a lot of the oppressive taxation. They're quite happy with the moves we have made to assist a segment of the small business community with lower interest rates, something the NDP feel very sad that they didn't include in the great proposal that they brought out last March. They also recognize that the money we are putting into our plan for economic recovery is not a giveaway program like that laid out by the Leader of the Opposition as an economic recovery program, where they wanted to build a post office on every street corner. So they do have a lot of faith that our economic recovery program will be good for them and will maintain the employment level, and will possibly raise it during the months ahead.

HON. MR. CHABOT: On a point of order under standing order 8, that all members are obliged to be present in this House unless they've been granted permission. has the member for Atlin (Mr. Passarell) been granted permission to be absent? If so, is the purpose to secure a tag for the last grizzly bear he shot, or is he out to shoot another grizzly bear?

MR. SPEAKER: Thank you. hon. member. The Chair has the point of order.

Orders of the Day

HON. MR. GARDOM: Adjourned debate on second reading of Bill 89, Mr. Speaker.

SCHOOL SERVICES (INTERIM) ACT

(continued)

HON. MR. VANDER ZALM: Mr. Speaker, this morning I made mention of the fact that last week there was very little debate from the NDP — the socialist side of the House — with respect to this bill. They obviously did not want to participate in this restraint legislation, and the debate was much more from this side, with, as I said, no mention from the socialists. That changed yesterday, and there was some debate from them today. Obviously, over the weekend they were told by the BCTF: "You must get involved; you can't simply sit there; please make yourself heard." Well, we heard from the NDP, and they certainly provided a whole lot of criticism, but nothing constructive — no alternatives, and no suggestions as to how they might address the matter of restraint as it is required in the area of education. or government generally.

It's been said by the opposition that somehow this was a political move on the part of government, that we were using it for politics, Somehow it was also charged that we were conscripting children. Mr. Speaker. I would just like to make some reference to a few articles that I think will indicate very clearly where the politics have been in the whole of the debate on this particular bill and where the politics have been out there when addressing this same legislation. As the second member for Surrey (Mr. Hall) — and I see him there — would agree, out there in the constituency, in Surrey as elsewhere in British Columbia, there's support from the people, be they Social Credit or NDP. for the government restraint measures. All people everywhere are calling in and writing in, saying that they certainly support the government's legislative approach with respect to restraint in educational spending. The second member for Surrey, I see by his applause, agrees with the statement I've just made.

At the same time. Mr. Speaker. It's sad when we see such things as occurred in Esquimalt — and unfortunately the member for Esquimalt—Port Renfrew (Mr. Mitchell) is not here — when a meeting was held to discuss the restraint measures and the legislation in the western communities, a meeting at which the teachers were present. I'm sure the BCTF again put forth its case. When the media there wanted to have a comment from the local president of the teachers' association, they could only track him down in the NDP constituency office. That's the only place this particular member was to be found immediately after the meeting, conferring with the socialists as to how they could collectively try to fight the government on the program it was instituting on behalf of all British Columbians. As the newspaper in the area pointed out very clearly and said very well: "There are local teachers being manipulated by their leadership for purely political purposes perhaps. On the surface, the fact that a local teacher, union leader John Bergbusch, scurried off to the NDP offices after a long and inconclusive meeting of area teachers seems all in innocence. but...." And the article goes on.

Mr. Speaker. the evidence is certainly there in your own constituency. If I want to hear from at least one political party in Delta as to what their stance on the restraint program is, I can call the NDP candidate in Delta — my neighbouring constituency — Mr. Karl Moser, who has circulated literature throughout the whole of that constituency in support of his candidacy on behalf of the socialists in British Columbia. If I call the number that he gives, and if I want his views on a particular matter, including the government restraint program, where do you think he answers? It's at the school in Delta. Talk about manipulation. talk about using the system, talk about abusing children, talk about abusing the tax-payers' time and the taxpayers' money. Where do I call that member in Delta but at the school he's supposed to be working at! That's the number on the literature. They think it's funny.

The member from Courtenay stood up in her place yesterday and said the very same thing, that somehow the government and its legislation were using children and abusing, as

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they mentioned, the system for political purposes. Let me mention to that member — she knows it full well — that at taxpayers' expense, every home in the Courtenay-Comox constituency received this particular rag, this sheet if you want to read it. I'll make it available to each and every one of you; it's purely politics, paid for by the taxpayers — saying, among other things, that the general public has been severely eroded by the provincial government's actions.

It goes on and on, but hopefully it was thought that perhaps during this debate we could hear from the socialists and find out what alternatives they have with respect to saving the cost of education or government on behalf of British Columbians everywhere. All we know are the bits and pieces that — are fed to us indirectly from time to time by the Leader of the Opposition, not in the House in his place, but when he's speaking to other groups. He's generally missing; maybe that explains it. The Leader of the Opposition, when he was speaking to the government in Ottawa, said: "Oh, yes, we'll give you all the resource revenues, providing you will nationalize all of these companies." That was the socialist platform: give it away to Ottawa and Trudeau. That would certainly have speeded up the process. I guess that nationalization is happening to a degree in any case. I guess the revenues are being eroded to some degree, but the socialist NDP leader in British Columbia was prepared to give all of that revenue away to Ottawa.

If that isn't enough, when that same socialist leader, only last week, was addressing the municipalities in British Columbia — remember, he doesn't speak up here — he said: "Ladies and gentlemen, if you elect me as your Premier and elect the socialists to government in British Columbia, we'll give you $300 million to build edifices, various centres or facilities in your community. We'll pay the cost. It's our response to restraint." Do you know where that money was to come from? It was to come from gas revenues that he hadn't received and had already promised the feds some time ago. Now this same Leader of the Opposition, instead of speaking out in his place in the Legislature, writes a letter to Mr. Larry Kuehn, president of the BCTF, and says:

"Dear Mr. Kuehn:

"Further to our conversation today, I wish to reiterate the New Democratic Party's position regarding education financing and philosophy in British Columbia. If returned to government, the NDP will immediately institute the following:

" 1. Complete financing in the present fiscal year of all contracts and issues undertaken."

"We'll give you back all the money we haven't received." Again, he's given away the money they haven't got. He's giving it back to the BCTF. "If you, the BCTF, will give us the vote and put the socialists back to power, we'll give you the money. Here's the bank. The door's open. Come on in." The socialists — the giveaway gang!

"2. No changes in educational goals and financing without full and complete consultation with the school teachers, the BCTF, the parents and the trustees."

I am sure that to the executive of the BCTF this may be music. Unfortunately, the Leader of the Opposition certainly hadn't thought it through, because he had already given away the moneys to Ottawa. He then gave away the moneys he didn't have to the municipalities, and he's now giving the moneys that he has already given away, that he didn't have anyway, to the BCTF. An open bank door. Give it away gang, — the socialists over there. But I wonder how that would sound to a British Columbian who lives in the constituency of Surrey. The second member (Mr. Hall) isn't here now, but he would know this person, who says:

"Dear Bill:

"Belated congratulations on your appointment to the Education ministry. I support your stand on restraint and your position with regard to the BCTF. I think that for a profession they have a very unprofessional attitude toward their job. I too have found a poor economy a great strain. I have reduced my staff to one architect and myself. Our profession has about 30 percent unemployment, and those of us who are still working will have our earnings cut by over 25 percent."

I wonder how this private entrepreneur, this taxpayer — the guy that gets out there early in the morning and works till whatever hour required at night to fight for a living — would feel about this socialist gang giving away his hard-earned earnings, especially when they're simply not there during this time of economic downturn.

In response to the opposition, let me say very honestly that if, given the alternatives, the economy were buoyant, I too would much prefer not to be debating this sort of measure. I am sure the same would go for the legislators in Alberta, who have had to close classrooms, lay off teachers and close down whole schools. I'm sure the same would go for the people in Washington state, our good neighbours, the Americans across the way. I'm sure they too would much prefer not to be taking the sorts of measures that they've had to take to close down schools, lay off teachers and cancel programs. That's not the wish of our American friends. It's not the wish of our neighbours in the provinces to the east. And it's not the wish of the people in Europe to be cutting back on various programs or cutting back on the number of educators in order to make ends meet.

It's not my wish, or our wish, that we should bring forth this sort of legislation, or take the type of actions we've had to take. But given the choice, and looking at what's happened in all of those provinces and in all of those states below the 49th parallel, I say that British Columbians ought to be proud that they have a government that would have the guts, the fortitude and the foresight to take this sort of action. We are not laying off teachers. There is no need to lay off teachers. Teachers can feel secure in their jobs in British Columbia, unlike Alberta, Washington state or elsewhere in the world. In British Columbia they can feel secure because the government took this action. We're not having to cancel programs. We can continue with all of the programs. As a matter of fact, if you look at the special-education programs today and compare them to the last year of the socialists, we are 50 percent up as a percentage of budget in our special-education programs. We've shown that we not only say we care for the handicapped, the disabled and the disadvantaged, but we also do something about it, and that's more than the socialists can say. I think we ought to be very proud.

I would appeal to the BCTF to listen to their membership, to all of their teachers, and to really give careful attention to all of those individual members, those good and wonderful people who teach in our schools, who are concerned, rational and reasonable, and who understand that as professionals and as members of society in British Columbia, they too are required to give somewhere, somewhat, if we're to keep a balance and maintain a healthy educational system — the

[ Page 9591 ]

healthiest anywhere in Canada. They understand. The people in our communities — the Surrey-ites, the Delta-ites, the Richmonders, all of the people everywhere in British Columbia — understand that government cannot go on spending forever, expanding its program, providing increases to all of the people involved, while the private sector is forced to cut back, cut down, do without. They understand. Our citizens understand, the teachers understand, and I would only hope that somehow the socialists — and I would appeal to them — would be reasonable for the good of all British Columbians, and would get the message out to the BCTF that all of us have a responsibility. As MLAs we took a cutback: we know the people in the medical profession are recommending a cutback; we know the private sector is taking a cutback. 'Let's all of us here collectively appeal to the BCTF that they. too, try to understand that they have to be a part of this.

As a group of professionals — if they care about their profession as opposed to their association, or as opposed to themselves as individuals — they ought to understand that this legislation affords the sort of protection that should be provided wherever possible. I know it can't be done for those in the private sector. Obviously there's no way we can provide legislation to somehow keep all architects employed or all engineers employed, or legislation that says whatever the amount of work last year, we'll make sure it's available for you this year; you somehow share, but you keep working, you keep employed. You and all of your members in the association, you and all of those professionals, will get a piece of the pie. You'll all have your share. You'll keep working. You'll keep bringing home the bread. We can't give that to the architects. We can't give that to the engineers. We can't give it the private sector. But the BCTF ought to be grateful that we can give it to them, that we can provide that sort of protection.

Can you imagine the members of the socialist party, each and every one of you, particularly those few who represent constituencies where there is forestry industry and mining...? Can you imagine trying to advise those of your group that represent downtown Victoria or downtown Vancouver of the world out there, where the people in forestry are unemployed? If somehow they could be provided with this sort of protection, don't you think they would be grateful? Don't you think they would appreciate it? Sure, the value of the cutback for teachers amounts to 4 to 6 percent of the 17.5 percent, plus perhaps a 2 percent increment that they received earlier this year. Maybe the 19 percent average increase that the teachers received has been cut back possibly to an average 15 percent increase. But they all keep working, and they keep their programs. Wouldn't that be nice for the guy in the logging camp who is unemployed, for the miner looking for a job, for the carpenter working part time, for the millworker sharing his work? Wouldn't they love this? Wouldn't it be nice?

But where are the socialists? When do they speak out on behalf of those citizens who work in the private sector? Where are they? We have here for the teachers, for all those in the profession, what I consider to be a good and reasonable approach, and one that will not erode their base. They're really maintaining their base, which is important to them as well. I can understand that. It's good legislation, Mr. Speaker. We as British Columbians can be very proud. We have the highest per-pupil cost in Canada, second only to Alberta. I'm not proud of that fact. I think I as a minister, and we as people in government, regardless of where we sit in this Legislature, should work towards bringing down the cost to the taxpayer.

We have the responsibility not only to provide a good system of education, but to do so at the least possible cost. That's not unreasonable, But we do have the second-highest cost, second only to Alberta in the whole of Canada.

B.C. salaries in the educational system, as a proportion of the total education costs. are the highest in Canada. Again, we can't attribute this — BCTF, all of you who are listening out there — to the teachers: I think it is really much the blame of successive provincial governments, particularly school boards, for having allowed the upper crust, the bureaucracy, the administration to grow out of proportion to what the total cost ought to be. It's not bad to recognize that. I as a minister, my deputy, his assistant or a superintendent in the system don't have to be defensive about that, We have to recognize it and ask what we can do about it, and then: will we do it? I can assure you that I am prepared to do it. and I think all those good people to whom I must look for support will be prepared to do that.

Even after restraint. the provincial grant this year is up 25 percent over what it was last year. Even after all of the restraint, the budgets for school districts are up 16 percent of what they were in 1981, one year ago. I say again to the socialists: do your homework. A lot of your constituents don't have a 16 percent increase in their household budget or in their business. So when you're talking about the need to maintain that initial 22 percent increase, or you're crying, as socialists do so often, about having to cut back to 16 percent, think about all those small businesses out there in your constituency and think about the householder. Do you think they've got 16 percent more than they had last year? I would guess not.

Another fact is worth mentioning. In the last four years — again, I don't say this as something we ought to be proud of: rather as a concern that we should address — the student population in British Columbia has dropped by 20,000, but we have 3.000 more professionals. So, Mr. Speaker, you can see that we have to address these problems in the ministry. Certainly I take great pride in having the opportunity to bring about some of the initiatives required to help provide for a better, more accountable and more reasonable system in British Columbia. This bill is the beginning of better things to come. It's a recognition by government that we must protect the system and that where ever possible we should provide protection for those who are employed in this system wherever we can — and we're doing that.

Instead of standing up on the side of the BCTF, in opposition to the majority of the teachers in this province, in opposition to the will of the majority of taxpayers in this province, in opposition to the majority of parents, who are out there earning and paying and who understand that you can't go on forever increasing the cost without the system somehow caving in, these socialists have one more chance — they can vote or second reading, and I so move.

Motion approved on the following division:

YEAS — 29

[ Page 9592 ]

NAYS — 23

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

HON. MR. VANDER ZALM: I move the bill be referred to a Committee of the Whole House, with leave, now.

Leave not granted.

Bill 89, School Services (Interim) Act, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Committee on Bill 88, Mr. Speaker.

MISCELLANEOUS STATUTES
AMENDMENT ACT (NO. 3), 1982

The House in committee on Bill 88; Mr. Strachan in the chair.

Sections 1 to 4 inclusive approved.

On section 5.

MS. BROWN: This Community Care Facility Act was opened once before and amended to remove a time limit in terms of inspections by health officers, and at that time I raised the issue with the minister that that was not a good idea, that in fact the act should retain in it a request that these facilities be inspected at least once annually. I notice in this section that the act is being opened again and amended, and I wonder whether the minister would be willing at this time to put back into the act what was taken out the last time that the act was amended, to amend it so that it reads that inspections have to take place at least once each year.

HON. MR. NIELSEN: Even though we're reflecting on a vote, the answer is no.

Sections 5 to 12 inclusive approved.

On section 13.

MS. BROWN: Mr. Chairman, if it would help, I can respond to sections 13 and 15 and say that I think they're good amendments.

Sections 13 to 22 inclusive approved.

On section 23.

MR. MACDONALD: Would the Minister of Lands (Hon. Mr. Brummet)...? Where is he? He's not here. Would the Attorney-General explain why the removal of a condition in a Crown grant should be at the minister's discretion, rather than by order-in-council? It can be a very important decision.

HON. MR. WILLIAMS: On behalf of the Minister of Lands, may I say that this power which is given to the minister can only be used in those cases, as the marginal note states, where a term, condition, stipulation or reservation has been included in the Crown grant in error. It is not for the purpose of making any substantive changes in Crown grants which have been issued, but only where there has been an error and the continued existence of the inclusion is not in the public interest.

MR. MACDONALD: Far be it from me to give the Attorney-General a law lesson, but section 49 (l) says: "included in error or is no longer required in the public interest." So it's a very broad discretion that's being given to the Minister of Lands. We're not sure that the incumbent is not going to use that with an ulterior motive. Why shouldn't it be an order-in-council? Then it's published and debated by cabinet, and decided by one man, the Premier.

HON. MR. WILLIAMS: We have, in the course of preparing this amendment, discussed the matter with Lands officials. They indicate that the use of this provision is only an administrative act, and not one which would require a decision by the Lieutenant-Governor-in-Council.

Sections 23 to 46 inclusive approved.

On section 47.

HON. MR. WILLIAMS: Mr. Chairman, I move the amendment standing under my name on the order paper, numbered section 47.1. [See appendix.]

This is an amendment to section 133(2) of the Utilities Commission Act, as it was enacted earlier this year. That subsection refers to: "'costs of the commission' means costs...of consultants" and specialists which are engaged by the commission. There was an error in the drafting of that section earlier this year. The amendment is to change the word "means" to "includes" so it is not restrictive.

On the amendment.

MR. BARBER: I wonder if the Clerk could clarify. This is an amendment to section 47 of Bill 88? What has it got to do with the Travel Agents Act?

HON. MR. WILLIAMS: Nothing. It's an addition.

MR. BARBER: Why is it here if it has nothing to do with it?

HON. MR. WILLIAMS: It's a new heading.

MR. CHAIRMAN: Perhaps we could do this in a parliamentary fashion. Would the Attorney like to respond?

[ Page 9593 ]

MR. BARBER: I don't understand why you're amending section 47 of this bill by amending an act amending the Travel Agents Act, which is not referred to in the principle of the same section.

HON. MR. WILLIAMS: Section 47 deals with travel agents. It is intended to include an amendment to the Utilities Commission Act in the Miscellaneous Statutes Amendment Act by putting in a new heading, "Utilities Commission Act Amendment," and moving an amendment to what is presently section 133(2) of that statute for the purpose of changing, as I explained a few moments ago, the word "means" to "includes" so that the definition of "costs of the commission" is made less restrictive.

MR. BARBER: We had this problem before when, once again as the result of an oversight or a late application, the government brought in an amendment that was entirely irrelevant to the principal section — in this case, section 47 under Travel Agents Act. To the best of my knowledge, the Utilities Commission has absolutely nothing to do with the regulation of the travel industry; there is no connection whatsoever. With respect, Mr. Chairman, I thought the government had agreed the last time this occurred, when the same confusion resulted, that it would not occur again. Surely it would be an easy matter, would it not, to include a new section 49 and be done with it. Why are you amending section 47 in this way? It doesn't make any sense at all if we are expected to address ourselves to amendments to the Travel Agents Act, which is what the bill clearly specifies. It has nothing to do with the Utilities Commission. I wish to speak on the travel agents; I hope not to lose the chance to do that, by having to debate something that has to do with the Utilities Commission and has the wrong number.

HON. MR. WILLIAMS: May I offer this clarification to the member. Traditionally the miscellaneous statutes list the various statutes dealt with in alphabetical order. As the bill was originally introduced, sections 46 and 47 dealt with travel agents. The next position in which any new provision would be made for the Utilities Commission would come after "T." If indeed there had been some other intervening statute with some other alphabetical relationship, it might have come later. We couldn't have put it as section 49 because the commencement section is always the last. This was the circumstance whereby it had to be interspaced between 47 and 48; we could have made it 48 and renumbered 48 as 49, which would have been a confusing amendment but certainly less confusing than what is before the committee at this time.

MR. HOWARD: What does section 133(2) of the Utilities Commission Act say now?

HON. MR. WILLIAMS: I'd be happy to answer the question. Section 133(2) is for the purpose of defining the words "costs of the commission." It presently reads: "'costs of the commission' means consultants' fees and specialists," as near as I can remember the words. They won't be in the book before you. We're just changing "means" those things to "includes" those things, so it's less restrictive.

MR. HOWARD: I think that's the problem. It's not in the statute books available here; there's no section 133(2). so it was difficult to follow what it meant.

MR. BARBER: With all respect to the Attorney-General, although his explanation is welcome his policy is not. It's much more rational to just renumber the darn things, to explain it as a renumbering, and take advantage of the clarity.

Section 47 is an amendment to the Travel Agents Act. What's going on here is that the classes of persons who may be protected in the event of a business failure, which has been all too often — and notorious — in this province, may be redefined at the will of the Crown. First, I wonder if the minister responsible, who is here, could advise us what the will of the Crown shall be, whether the general level of protection currently available will be maintained or further restricted.

HON. MR. HEWITT: It deals, of course, with putting in an additional paragraph in the section relating to regulations. It allows the Lieutenant-Governor-in-Council to designate classes or kinds of people. In effect, it puts into the act that which is policy at the present time. It has resulted primarily from the ombudsman, who feels it should be clarified. At the present time, it deals with those people who are either residents of British Columbia or who have contracted for travel services wholly located within British Columbia. So existing policy is to be maintained, but the additional paragraph under the regulation section sets it out more clearly, as opposed to what has been the policy in the past.

MR. BARBER: Together with my colleague from Surrey I act as Tourism critic, and as I'm sure the minister knows, we've had inquiries. May I take it then that he has given us his word that there will be no reduction in the benefits, the coverage and the entitlement under the program as the result of the incorporation here of what he describes as policy that's already in place? There will be no reductions in entitlement for protection; is that the minister's word?

HON. MR. HEWITT: There's no change in the existing policy before us at the present time.

Section 47 approved.

On section 47.1.

HON. MR. WILLIAMS: I now move section 47.1, and in so moving I wish to say to the first member for Victoria (Mr. Barber) that I feel the same way he does. If we could remember, I think it creates far less confusion in debate in committee. I'm told, however, that by not renumbering we save many more problems with regard to the way in which the bill is dealt with when it gets to the printing stage. Frankly. I don't understand that kind of mechanics.

Section 47.1 approved.

On Section 48.

HON. MR. WILLIAMS: I move the amendment to section 48 standing in my name. [See appendix.]

On the amendment.

HON. MR. WILLIAMS: I will advise the House that the reason for this amendment is that since the introduction of the bill, we have had the opportunity for discussion with the

[ Page 9594 ]

various ministries associated with the sections referred to in subsection (1) as it now is, and it is clear that all may come into force on proclamation except sections 8, 11, 18 and 20. We are therefore restricting proclamation to those three sections only.

Amendment approved.

Section 48 as amended approved.

Title approved.

HON. MR. WILLIAMS: I move the committee rise and report the bill complete with amendments.

Motion approved.

The House resumed; Mr. Speaker in the chair.

Bill 88, Miscellaneous Statutes Amendment Act (No. 3) 1982, reported complete with amendments to be considered at the next sitting of the House after today.

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

FINANCIAL ADMINISTRATION
AMENDMENT ACT (No. 2), 1982

(continued)

MRS. WALLACE: As I understand it, we're discussing an amendment to Bill 86.

MR. SPEAKER: That's correct, hon. member,

On the amendment.

MRS. WALLACE: It's a very important amendment, Mr. Speaker, because there has to be — and I would expect the government benches to agree with me — some control on government spending. This amendment has been proposed because the bill itself puts no control on government spending. When we look at the record of this government over its years in office, we can see a very great need for some control on government spending.

I took the time to go through Public Accounts this morning. It's interesting to note that the figures there are very clear. It's been quoted in this House many times before, but I think it bears repeating, inasmuch as somehow the government members don't seem to recognize what they've managed to accomplish over the last seven or eight years. According to Public Accounts, when they took office at the end of the fiscal year, the public debt stood at $4.4 billion. In their first year of office that public debt rose to $5.3 billion, then to $6 billion and to $6.7 billion. I took these figures this morning from the Public Accounts, which are the records of this government's operation. It went from $6.7 billion to $7.2 billion, to $7.8 billion, until the last year ending in 1981 we had a $9.4 billion debt. That has more than doubled.

If we are to listen to what the government is saying today through their legislation, and to the words of the Minister of Finance, we are now in a position where we are being asked — if my mathematics are correct — to forward approval to this government for the borrowing of some $1.6 billion. The Minister of Finance indicates, and certainly through the statistics on the operating budget, that we're going to be looking at something like a $1 billion deficit at the end of this year for operating expenses. Those figures, added to the $9.4 billion, bring us up to something like $13 billion. That's almost three times the debt we had in 1975, and that was without the benefit of this piece of legislation which, without amendment, would be completely open-ended.

[Mr. Strachan in the chair.]

I'm concerned, as I'm sure the people of British Columbia are, that we have this kind of legislation being proposed. Therefore I am very much in favour of an amendment which points out that this is far from good financial practice. To refresh the House's memory, the amendment reads: "it is not in keeping with proper fiscal policy to have no limitation on the aggregate amount of money which may be raised by borrowing under the Financial Administration Act." What I have attempted to point out is that without the benefit of any open-ended legislation like this, this government has managed to approximately triple our debt over the last seven or eight years. That's a very strange thing to happen from a government who, year after year when they present their budget speeches, come into this House and talk about how terrible debt is.

This is the March 19, 1976 budget in which they talk about trying to develop cooperation with business, labour and so on: "In addition to that we will to the best of our ability provide the sound financial management that the province needs." Their ability was not too great, Mr. Speaker, if this is the kind of result that we've had from their so-called sound financial management. The then Minister of Finance goes on to say:

Governments, 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. But the Bank of Canada Governor-General Bouey warned us only the other day that too much borrowing by governments will stifle the growth of the economy. The competition by the public sector and the private sector for available funds will, in a period of monetary restraint, force interest rates to a higher level.

That was the thinking of this government in 1976. They go on to quote recent tragic examples: New York, Chicago, Britain, etc. In 1976 the government certainly was talking in entirely the opposite direction.

In 1977 they said: "We will continue to hold government spending within income. No doubt some theorists will continue to press for deficit financing in government, as they have in the past. This government does not subscribe to deficit financing to underwrite its current operations." We certainly had a very clear statement there relative to current operations, and that was in 1977. In that year, their current operations showed close to a billion dollars excess of revenue over expenditure. At the same time, they had increased the fixed capital debt by nearly a billion dollars — by about the same amount, Mr. Speaker. They were taking it out of one pocket and putting it into the other.

In the budget speech in 1978 things were a little different. They said:

We have extra funds that we can add to this current year's normal spending proposals to provide dynamic action against the fight against unemployment. This would never have been possible had we borrowed to pay our way out of the inherited difficulties of prior years. The funds that will create jobs today are the funds that otherwise would have gone to service dead-weight debt.

[ Page 9595 ]

Well, Mr. Speaker, as I pointed out, the year before they had increased their debt by a billion dollars, and they had built up an excess of revenue over expenditures of almost exactly a like amount. It's interesting, when you think about it, that that occurred prior to an election. I suspect that a government that is prepared to use the finances of this province to attempt to hide debt and to build up revenues in excess of their expenditures in order that the goodies can be dished out for an election certainly needs an open-ended bill which will allow them even more freedom than they have managed to practise in the past. Certainly it is not in the best interests of good, proper fiscal policy.

In 1979 they were starting to talk a little bit about cutbacks. They were talking about trying to balance the budget. In 1978 they were dishing out all kinds of goodies, Mr. Speaker, and after the election in 1979 they were saying: "Well, we have to balance the budget, and this can only lead to cutbacks in programs or the creation of more dead-weight debt, and we do not intend to follow that road in British Columbia."

We come up to the budget speech of 1980, which isn't that long ago. They talk about having a surplus: in spite of the fact that they were concerned whether they would even be able to make their budget balance the year before, they have managed to get a bit of a surplus. Again, they talk about the need to not have any debt. They say they are budgeting for a balance between revenue and expenditure in 1980-81. No debt — they are extremely opposed to debt.

We come to 1981. They talk about "The Balance of Choices" and "Priorities for 1981-82." There are three choices:

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 obvious at the federal level. Once a government becomes trapped in the mire of deficit spending it is almost impossible to correct the situation. I do not intend to leave that legacy to my successors in this portfolio in the years ahead.

Of course. that budget was presented in 1981 by the current Minister of Finance, so the turnabout that has taken place on the part of this government seems very strange — even in this current budget for 1982.

Finally, Mr. Speaker, we shall continue to resist the borrowing trap into which many other governments have fallen, seldom to emerge. Prudent families would never borrow to buy groceries, although many borrow for a new car. and most will borrow for a new home. This government adheres to similar rules of careful financial management. We shall not borrow to finance the ongoing operation of programs, although it is both appropriate and necessary to borrow for major capital purchases such as schools, hospitals and railway facilities.

I would suggest most particular in the minds of that government, Mr. Speaker, are the railway facilities. We have seen — again from public accounts — a $45 million entry and a $12 million entry, which comes awfully close to the amount which has been turned over to finance the B.C. Railway for the northeast coal development and which comes very close to the amount of funding that would be required to keep the educational system at last year's level. Its current level of operation, rather than instituting the series of four cutbacks that have been asked for during the past year.

I suggest that we have a need, as long as this government is in office — or, for that matter, any government — to have some limits, some reporting. some responsibility to this assembly for any borrowing of money. Their track record is not very good. I've outlined the capital deficits and the amount of debt that has accumulated in the eight years. It's interesting to note that in actuality we had a deficit last year and an even bigger one this year in our operating. So I very much support is amendment. I believe that if we are going to go into deficit financing — and I recognize that we are in a time of extreme economic difficulties in this province and in other areas — any deficit financing we undertake must have limits, for the very reasons that the Ministers of Finance, both this one and the last one, have stated in this House time after time that we must not establish great amounts of deadweight debt, because of the difficulties that always occur when it comes to paying off that debt.

If there is to be a need to extend credit for operating, then let's have it accounted for in this House. Let's have some limits on it. Let's make sure that we are not just going headlong deeper and deeper in debt, with no need for reporting — well, a need to report very briefly to the Legislature if it happens to be sitting and when it happens to sit, but no real need to come to this legislative body, which is supposed to be the decision-making body in this province. It is an opportunity for this Government to borrow for whatever purpose they want, for however long they want, and whenever they want. That's too much unrestricted power to put in the hands of any Minister of Finance or any cabinet. It's particularly too much power to put in the hands of this particular cabinet and this particular Minister of Finance and that is borne out by their past record. I am very much in support of this amendment, which would ensure that better fiscal policies were followed than we have seen demonstrated here over the last eight years.

MR. DAVIS: I won't make any bones about it: I don't like deficit financing. I don't like it at any time, and I really believe, as does my party. the party in government, in arranging finances on a pay-as-you-go basis. I would like to think that we can keep our provincial bottom line, if I can describe it that way in the black. That's the only way government, I believe, can finance its operations and still keep a triple-A rating, still pay minimum interest rates and still operate on a current basis in such a way as to contain current operating outlays.

We're obviously in a bit of a bind right now. Governments across this country are certainly in a bind which is not entirely — in fact, not largely — of our own making. It's a matter of record everywhere that western democracies are having trouble financing government because of high levels of unemployment and because they can't sell their products overseas. That certainly goes for British Columbia, a part of the world which is so heavily dependent on foreign trade for much of its income. It looks to me — I've got no inside information — as if we have a current operating deficit of, say, in the order of half a billion dollars. It could be more, but that's a substantial amount. It's a large deficit. seen in the context of an overall budget in the order of $7 billion. It's an unwanted deficit in the order of 5 to 10 percent.

This, as all hon. members know, is the first deficit that the Social Credit Party has had to face since the early 1950s. Deficits, regardless, are bad news. They're bad news especially in provinces like British Columbia, in which, typically, the private sector has to borrow abroad and which, with any luck at all, should be able to operate in the black year in and year out through all time. This special borrowing bill is

[ Page 9596 ]

unprecedented. It's certainly unprecedented for a Social Credit government. The Social Credit government hasn't run a deficit since it was first elected in 1952.

This legislation must pass. It has to pass in order to pay doctors' fees, nurses' wages, teachers' salaries and our public service employees; to pay, in other words, to keep the machinery of government running and to pay those very worthy people who work for us as our public servants throughout the year. It has to pass if we're going to be able to pay social assistance. Social assistance on an increasing scale seems to be inevitable, especially as more and more people are running out of unemployment insurance. They'll be coming heavily on the province and the provincial treasury for support through the winter months. That, I contend, is unavoidable. That's one more reason why we are probably facing a deficit in the remainder of this year.

There are several big projects. In fact, British Columbia is the only part of Canada that appears to have any large projects — call them megaprojects — going. Job-creating projects are meanwhile in full stride. They too, at least in part, have to be financed via the provincial treasury. I refer to northeast coal, the port development at Prince Rupert, the downtown redevelopment in Vancouver, North Vancouver, Burnaby now and certainly New Westminster, hospital construction which is continuing, some school construction which is a commitment and light rapid transit in the lower mainland.

Those are substantial projects or programs, all of which cost money and certainly involve hundreds of millions of dollars in total. Those moneys must be spent now if we're to maintain the employment which they can create. Many of them, certainly the larger ones, have the prospect of paying out. In other words, the province has the prospect of recovering moneys from those projects. But the recovery of moneys is still some years away. We're talking, therefore, about additional hundreds of millions of dollars over and above the normal operating deficit — or not so normal — which the government is also encountering.

I know the government is trimming its less vital expenses to the bone. I know it's trying to restrain its outlays, even on education. I say restraint in that case, because, as we all know, the budget of the Ministry of Education has been increased in current dollars in the order of 15 percent even with the restraint or cutback. We have to restrain our expenditures with care in order to keep taxes down and in order that the present level of taxation will see us through to 1983 or 1984, when, presumably, I think — with some reason we can hope — the economy throughout this continent and certainly in this country will be picking up again.

Restraint on the expenditure side will certainly help, but tax revenue — income to the provincial treasury — will be slow to turn around. It has dipped dramatically in recent months. It may level off at a relatively low level, but it will be well into 1983 before income to the provincial treasury begins to move up again. So we have a difficult hiatus, a period of months in which income will fall short of outgo, a span of time in which we have to borrow, hopefully only on the short term — partly because interest rates may continue to decline, and we would be able to take advantage of the declining interest rates. Again, hopefully we will be back on track in 1983, in the black again, where we don't have to borrow in order to pay for people programs like health, education and social assistance; to pay the grocery bills, if I can put it in everyday parlance.

At the outset I said that I didn't like a government borrowing on current operating account; I don't like it, and I still can't get used to the thought. Here are a few suggestions which I know the government can't act on immediately, but they are the kinds of things that governments could do if they knew they were likely to dip into the red on current operating account in order to balance their budget, in order to minimize borrowing or avoid borrowing altogether. What are these suggestions? I would continue to budget for a larger surplus from now on: I'd build up a bigger kitty, if I could call it that, bigger even than the billion dollar kitty the government had as recently as 1979. It can disappear quickly, as we've seen in the early 1980s, so we have to build up a multibillion dollar operating reserve in the mid-1980s; either that or we could be caught again and have to borrow on current operating account on relatively short notice.

What else would I do? I'd look at our provincial government-owned assets and sell off some of them. I'd make up my mind to sell them as soon as markets improve, not right away; that's why a policy along these lines has to be thought out and scheduled perhaps even years in advance. I'd borrow against those prospective sales and thus avoid going into the red on current operating account, and I would pay off those borrowings when the sale of those assets actually took place. What assets are these? I'd sell off the mining rights to Hat Creek coal; they're worth a fortune. Mr. Speaker, as you know, Hat Creek coal, as a resource, is one of the best coal resources in North America, if not in the world. In other words, I'd give the private sector a chance to perhaps develop these coal resources and then sell their output to B.C. Hydro to generate thermal power, if that is indeed the policy of the government and what B.C. Hydro wishes to do. There are also petrochemical possibilities there; gas can be manufactured from that coal and so on. Down the years there are many private-sector possibilities as well as public-sector possibilities.

I would sell those mining rights at some appropriate time in the future. That would be income; that would at least be available to the province to act as a buffer — a kitty, if I can call it that — which could be drawn down in times such as these. I'd make this kind of decision ahead of events. If that policy were policy now, we'd be able to borrow against that asset; we'd have income now or we'd have moneys that we could use to meet our current operating deficit.

Hat Creek coal mining rights is one such asset; the gas distribution operations of B.C. Hydro are another. I've long felt that natural gas distribution should be separate, corporately and administratively, from the distribution and sale of electricity. The natural gas distribution operations of B.C. Hydro could be sold, again, at some future date — not on a crash basis, immediately; let's say to an investor-owned utility corporation with good administration, the rates of which would be regulated by the public utilities commission — rates, I suggest, which would not be higher, and which, conceivably, with good administration would in fact be less than might otherwise be charged by B.C. Hydro. Again, the province could borrow against such a sale, which might yield the provincial treasury $500 million, $600 million or $700 million. We'd not only have those moneys available to the government to meet any current operating deficit but we'd also have natural gas and electricity competing head-on out in the marketplace. We'd have two different entities setting pricing policy for energy rather than one. We wouldn't have one head office, namely that of B.C. Hydro, deciding which

[ Page 9597 ]

is best for us — relatively low-priced electricity or relatively low-priced natural gas. We'd have at least a measure of competition, and we'd have them alternately intervening against each other when it came to rate reductions or rate changes. As the public, we'd know a little more about those operations and, I think, as a result of competition we'd probably have a better deal as consumers.

We're unique on this continent. I can think of only one privately owned investor utility and no public ones which market both electricity and gas out of one head office. Pacific Gas and Electric is the only one that comes to mind. Otherwise, gas is marketed by one utility and electricity by another, generally across the continent, certainly across Canada and in western Europe. So we would be moving towards what is generally the case elsewhere and away from this special situation where one utility — a Crown corporation — sells both of the kinds of energy which will not only dominate the house-heating market and the space-heating market, but other markets for energy as well in this province for a long time to come.

I've mentioned two government-owned assets then: Hat Creek and the natural gas operations of B.C. Hydro. Those proceeds, for example, could help us to finance our new home mortgage relief plan. It could help the province to find the moneys to build B.C. Rail's Anzac spur line to Tumbler Ridge. It would help us to complete — I know it's nearly completed — the stadium, roadways and other facilities at B.C. Place. It could help us to finance light rail rapid transit, which otherwise will, in the next few years, have to be financed by borrowing, much as B.C. Hydro borrows. So the prospective sale of those assets, as a matter of definite policy, could help us around this difficult financing corner in that way.

There are numerous other assets that the province may consider selling at the right time. They include numerous provincial lands, varying considerably from place to place, which in the long term certainly are suited for housing. Provincially owned real estate, such as real estate owned by B.C. Rail, could be useful for industrial development or sold off for commercial purposes; rights to develop resorts close to provincial or national parks in British Columbia, or rights bordering some of these new short-takeoff-and-landing airstrips that the province is building or improving. Land rights around those strips will become valuable as time goes by because more commercial activities will take place: hotels, motels, even retailing will take place more and more around airports much as they used to concentrate around railway stations in the railway-building era.

One resource which has always intrigued me that is owned by the province — at least I have always contended it was owned by the province; there are those in Ottawa who think otherwise — is the so-called Doininion coat block. It's in the extreme southeastern corner of the province. It should have been turned over to British Columbia when the Peace River block was turned over to the province in the early 1930s, when the mineral rights on the prairies were turned over to those provincial administrations by the national government. The Dominion coal block was forgotten, omitted, or left out somehow.

So you have a substantial area in southeastern British Columbia where some of the most accessible and best-quality coal is available in the constituency of my hon. friend the member for Kootenay (Mr. Segarty) just south of the Crowsnest Pass. It is generally accessible to the railway in that area and readily mined. Yet it's in limbo. It's in federal jurisdiction and it's in provincial jurisdiction. That dispute as to ownership should be resolved soon, because the coal is readily accessible and those mining rights are extremely valuable. We could begin to auction some of them. admittedly to the higher bidder. There again is another resource which in time will be developed by the private sector. In time it can generate royalties and other revenue. It should be out with the private sector sooner rather than later. It could be available to the private sector and at the same time provide the kind of moneys, the kind of financial reserves, which the province could use at a time like this in order to keep in the black, in order to avoid borrowing. In order to avoid paying exceptional interest rates, as most administrations do now.

Our Canadian provinces and certainly the federal government, have had to pay exceptional sums merely in interest to people who have loaned money. The current Canadian deficit at the federal level would be wiped out if the federal government had not borrowed so heavily over the last decade. Interest on borrowings over the last decade at today's rates of interest now totals in the order of S20 billion a year. That $20 billion is the magnitude of the expected deficit; it may be higher. If we didn't have that debt federally, we would have a balanced budget. and certainly we wouldn't have to tax Canadians in order to pay exorbitant interest rates at a time like this. In other words, money like that could be available for direct projects, for employment-creating projects. This is the kind of policy I would like to see the federal government follow, as well as the provincial government in this province.

There are other things that can be done which can have a short-run — if not an immediate — impact on our provincial budget. Our Crown corporations are being required to trim their sails a bit. They won't be borrowing as heavily. They won't compete with the province as heavily as they might otherwise have clone in raising money from those who are prepared to lend it at today's interest rates.

To be more specific. I think B.C. Ferries could operate on a break-even basis from now on, at least on its main routes to Vancouver Island and theSun shine Coast — and be subsidized on other routes. In other words. B.C. Ferries could manage its affairs. It may need some increase in fares from time to time, but it could break even on at least those high traffic routes and be less of a drain on the current operating budget of the province, ICBC may be able to cut back a bit by getting out of general insurance, although its direction is to break even anyway. So I don't see it as a net drain on the provincial treasury.

There is a whole series of things. I personally am in favour of requiring our universities to charge costs for foreign students. Universities around the world, with the exception of a few Canadian universities — certainly those in British Columbia — now charge costs. We're now getting more than our share of foreign students because our universities are the biggest bargain in the world. We're charging 10 percent of operating costs — not capital included but just operating costs — to our own people and we're giving the same break to people from elsewhere. Nowhere else in the world can you act a deal like that. It's incredible.

I think that the provincial government should take a good hard took at this policy of subsidizing foreign students to the tune of at least S20 million a year and probably more like $30 million to come to university in British Columbia. If we need dollars for secondary education, or for health care, or particularly for social assistance, there are a few bucks the

[ Page 9598 ]

province could pick up, and it would merely be doing what Ontario is in the process of doing right now, what the British government and universities did three or four years ago. what all of western European universities did. Faced with an influx of rich sons and daughters of Arab sheiks and so on, they decided to charge them costs — average costs. I think we should do the same. If we do want to favour certain students from overseas, especially those from less-developed countries having financial difficulties, then let's have a system of scholarships and have those who we think deserve it — not, as the federal statistics show, 90 percent of them from very well-to-do families, coming to this province and to Canada for their university education. Why do otherwise? They can save collectively tens of millions of dollars doing so.

I wouldn't add to our public service payroll. I believe that's being held. The lid is on it now; that's obvious. I wouldn't add to the number of MLAs in the Legislature. That might save a few dollars but not a large amount. Certainly we shouldn't be adding to ministers' staffs, and I hope the various ministers are looking at consultants' fees, overtime and travel outlays.

There is one thing I wouldn't do, and I realize in this place it's controversial. I certainly wouldn't put provincial moneys as a subsidy into a gas pipeline to Vancouver Island unless and until the federal government is committed to put at least $200 million into that project. The federal government is now committed to put close to $1 billion into extensions eastward from Montreal into Quebec City and the Eastern Townships. It is prepared to put even more into extensions to the maritime provinces. Those commitments exist. They are earmarked as subsidies in the federal budget. There's no reason why that kind of federal money couldn't or shouldn't be available here. In fact, some of the federal people tell me that they've dangled it in front of British Columbia once or twice — specifically in the federal Finance minister's budget of the fall of 1980; and a subsidy for a pipeline to Vancouver Island was mentioned again by the Energy and Mines minister in official documents.

We've got to nail those moneys down — however we do it; I presume through our own utility board hearings and National Energy Board hearings — and be sure they're available to support a pipeline to Vancouver Island, and hopefully, as well, a petrochemical plant on, let's say, theSun shine Coast. That would mean jobs, but it wouldn't mean an operation that was totally subsidized by the province. It would mean a development which I think is inevitable. I think it's one that, in all fairness, should also be supported by the federal government and federal tax dollars. That is by no means a complete list of new sources of funds or possible savings, but it's a start. It's the kind of thing that I know the hon. Minister of Finance has been thinking about, been concerned about and is struggling with now.

I said at the beginning and I'll repeat that I have reservations about the bill. I don't like it, merely because to me it smacks of deficit financing on current operating account — which it is; everyone admits it's that. I'm basically opposed to financing current operations out of savings which otherwise could have gone into job creation, as I said earlier. But we are in this situation because the rest of the western world has a problem with its finances. We need our essential services. We certainly need moneys for social assistance in increasing amounts this fall, so the legislation has to pass.

I've thrown out these thoughts simply because I hope they'll provoke some thinking along several of these lines.

I'm going to vote for the bill, not because I like or am in favour of deficit financing, but because it has to be. If members opposite want to pay as much money for education as they do and pay as much as they say they're prepared to pay for other projects, including $400 million or $500 million for municipal development, then they certainly would have us in the red under those circumstances, and they have to vote for the bill too.

MR. SKELLY: I rise to speak in favour of the amendment which, as the member for Cowichan-Malahat (Mrs. Wallace) pointed out, was simply to place a limitation on the amount which would be raised by borrowings under this proposed amendment to the Financial Administration Act.

I must say that I'm absolutely amazed at the speech I just heard. My family has been in this country since 1819, in Quebec, and since 1913 here in British Columbia. We're very proud of this country and province. I have never heard such a suggestion as I just heard from that member for North Vancouver. What he's proposing is that we put up a sign at the border of British Columbia saying, "Colossal Garage Sale," and sell off all the assets of this province — or as many of the assets of this province as we can sell in order to bail us out of this difficulty which he says is caused by worldwide economic circumstances. If that were the case, who would be out there to buy our assets? What this government has done is plunge this province into economic circumstances which they're now trying to bail themselves out of by deficit financing.

How can you believe anything this government says to you? For years they tell you that they're opposed to debt and talk about deadweight debt. They talk about deficit financing and how they're opposed to it in principle. Now we're faced with a bill that does nothing more than plunge this province into who knows how many years of deficit financing if this government continues its regular spending characteristics. One time they tell you that B.C. is not for sale, and now the member for North Vancouver–Seymour says that we should put up a sign on the boundary of the province saying: "Colossal Garage Sale." We're going to sell it until we can pay our bills. How can you trust a government like this? Time after time, Mr. Speaker, we've been told by this government and by representatives of this government that they're opposed to debt.

My colleague from Cowichan-Malahat mentioned some figures. I'm going to present different figures. She was talking about the total direct and guaranteed debt, but I'll just talk about the net debt as reported in the budget speech of 1982. When the NDP government left office the total direct and guaranteed debt, net of sinking funds, was $3.845 billion. In 1981 at the end of March, the total Social Credit debt was $8.496 billion dollars, an increase in approximately six years of $4.65 billion. These people have raised the net debt of the province, guaranteed by the province, by a rate of $775 million a year. And they talk about being opposed to debt — and those were the good years. At the same time they took all the special funds, they took all the assets of the province, and either sold them off or liquidated them and put them into the operating budget so that nothing was left. In the six short years of Social Credit government, from 1976 until 1981, we went into debt $4.65 billion. That's more than every government for every year from 1871 to 1976. In that period of six years we've gone into debt more than every British Columbia government has in total for 105 years. And the Premier

[ Page 9599 ]

criticizes the federal deficit and says that this deficit is greater than any deficit of any federal government, even through two world wars. Yet in six years we have gone deeper into debt in this province than any previous British Columbia government and all British Columbia governments from 1871 to 1976. What it took these governments 105 years to accumulate in terms of debt, the Social Credit government of British Columbia under W.R. Bennett has done in six short years. This government isn't shovelling money out of the back of a truck; they're shovelling paper out — obligations. bonds, debt — and they're shovelling that paper out of the truck as if it were money. We have to pay that back in the future and our children and our grandchildren have to pay that back in the future, because they've blown all of the money of this province and all of the assets in the province. We don't even own the truck that they shovel it out of any more.

The member who just spoke talked about selling off the assets of the province in order to pay our current accounts. Well, what are the assets? What do we have left? We've sold off B.C. Resources Investment Corporation, and that's gone bust. The Premier went around the province telling the people to buy BCRIC at $6 a share, and now they're broke.

HON. MR. HEWITT: I bet you invested in Daon.

MR. SKELLY: Not a nickel.

Even B.C. Ferries.... Remember the fleet that the citizens of this province used to be proud of, the fleet that sailed the waters of British Columbia, the fleet that was owned by the citizens of British Columbia. They're all sold off now to eastern financial institutions. The member who just spoke was the guy who agreed to the sales and the leaseback with those eastern trust companies — selling off the assets of the province.

Remember, Mr. Speaker, when the Premier came out of the ski hills dressed in his ski uniform, looking like some bush-league Pierre Trudeau, saying that B.C. was not for sale when the CPR had made an offer on MacMillan Bloedel. B.C. was not for sale, he said. They'd sold the ferries, they'd sold out Columbia Cellulose, they'd sold out half the resources and they'd given away most of the coal. B.C. is not for sale because it's already given away — even the buses. There was an article in the paper recently.... "B.C. Transit has now followed B.C. Ferry Corporation into the sell-leaseback market." I think that it was that member who just spoke, who believes in selling off the assets of British Columbia as if we were involved in some kind of giant garage sale with the people's assets, who, in his connection with B.C. Transit, probably advocated that they sell off the buses of this province, so that when the people get on the bus they will be able to ride with Laurentide. Every debt institution in this country, every trust company, has its hooks into the assets which used to be owned by the people of this province, thanks to the profligacy of that government opposite. Now they ask for the right to go into debt with no limits. Who do they think the people of this province are? They've already sold the assets of the province, they've already sold the assets of the electors, and they've already gone into debt.

This government has sold the birthright of the people of this province. There's an attitude on the part of that government that they should act as a corporation does in times of economic problems: whenever you're in difficulty, then get into paper as quickly as you can. Sell off all the assets, liquidate everything you can, and in order to be less vulnerable become a paper company: nothing but debts, obligations, contracts, leases. Then, if you have to go belly-up, nobody will be able to get to your personal property. We've been converted from a wealthy, proud, operating, hard-working province to a paper province. Just like a paper corporation. We lease our buses from Laurentide Finance. We lease our ferries from Montreal Trust. What's he going to sell next? He can't sell B.C. Rail because he's already mortgaged it beyond the hilt. He can't sell B.C. Hydro; it's already been mortgaged beyond the hilt and it's not turning a dollar of profit. What is he going to sell? He's going to sell the very land under this building, the water, the rights to our energy and our minerals. He's going, to sell it offshore and turn this province into a paper province.

Mr. Speaker, at one time this was a province that you and I could be proud of. one that paid its own way in the world, built up assets for its citizens, its children and grandchildren, one that could stand with pride and say: "This province is a 'have' province in Canada. Our citizens are productive citizens. Our governments are honest governments, which manage the assets and finances of this province well for our citizens and future generations." What have we been reduced to now, when the member for North Vancouver–Seymour advocates the supernatural garage sale for the province of British Columbia? I simply can't believe it. I can't trust that government, and that's why I'm voting for this amendment.

For the first time in history we've got a government that's borrowed to the limit in the short space of six years and sold off the assets of its citizens. Crown corporations are either bankrupt, subsidized or losing money. Government employees are being paid off in government development bonds. We've paying our employees with bonds, with paper, with scrip. Schools and hospital budgets are being bled to keep this government operating over the next year. Now the government asks us to trust it with the issuance of treasury bills with no limit and for unspecified purposes. Why should you give a bankrupt a credit card? No other institution in the province or the country will. Why should this government ask the opposition to endorse giving a bankrupt government a credit card?

If there was some kind of comprehensive plan that wasn't simply based on getting votes in the next election somewhere down the next three years, perhaps a new budget that would show their strategy for getting British Columbia out of the economic morass that we're currently involved in, thanks to the profligate expenditures of that member for South Peace River (Hon. Mr. Phillips), a plan that related to this borrowing. then we would say: "Let's take a look at it." If they had a comprehensive plan to get out of debt, then maybe we would get behind it. I think the member for North Vancouver–Seymour just gave us the plan: "Give us the treasury bills. We're going to turn around and sell off the rest of the province."

[Mr. Speaker in the chair.]

I'm not like that member who just spoke. because I'm not solidly opposed to deficit financing if we can see where we can get out of it at some short distance in the future and if there is a plan of action that will show where we can pay off those obligations. perhaps over a two- three- or four-year period — whatever — as long as we can see sometime in the future that there's going to be a limit to the amount and

[ Page 9600 ]

purposes upon which this money could be spent. But I haven't seen that. In fact I haven't seen that this government is even capable of providing that kind of economic planning, initiative and resources to the people of this province.

They ask us to entrust this type of government to borrow unlimited amounts of money for unspecified purposes. As far as I'm concerned, we should not be granting that type of authority to a group amounting to economic saboteurs. They destroyed the economy of this province in the short space of six years. They do not deserve the trust of this opposition. They do not deserve the support of this opposition. They do not deserve the support of the citizens of British Columbia. As far as I'm concerned, in the next election they're not going to get it, regardless of when that election comes, because they have no plan, no economic ability and competence. Because they're nothing more than economic saboteurs. I don't intend to support the bill. I'm going to vote for the amendment because it imposes limitations on the rights that this minister is seeking to issue treasury bills: limitations as to amounts and limitations as to purposes for which he plans to spend or borrow this money.

MR. LEGGATT: I'm surprised that I haven't heard support from the government side with regard to the modest limit being asked for by the New Democratic Party on this bill. Perhaps it's a problem that because votes tend to be polarized in this place amendments aren't really examined as carefully as they should be. I must say that I'm disappointed that the member for North Vancouver–Seymour, who is a very rational member in this House, does not see fit to support this particular amendment, which surely would solve one of the serious errors that the minister has made in introducing the bill.

Why are we in this mess that we're in, having to go to the unlimited treasury bill borrowing scheme? I think it's interesting to look back at the budget of 1982 presented by the minister earlier this year with great fanfare and a lot of camera lights. At that time you may recall that almost every speaker on this side of the House, without exception, stated to that minister that he had overestimated his revenues and had underestimated his expenditures for the first time in the history of fiscal budgeting in the province of British Columbia. The tradition in the past had always been that the ministry constantly underestimated its revenue and overestimated is expenditures.

HON. MR. WOLFE: How about 1975?

MR. LEGGATT: Oh, if we could have 1975 back and see a $100 million deficit in this province, but we're facing a billion dollar deficit and the member opposite still wish to whimper about 1975. We are looking at the worst fiscal disaster this province has ever seen under the husbandry and administration of that government. There's no avoiding history of 1975, 1969 or 1972.

The reality is that we are in 1982. In 1982 the Minister of Finance, after all of the prognostications about the world economy and the B.C. economy.... Yes, the world economy is certainly partly to blame for the recession we're in. When it came to personal income tax revenues.... I'm referring to table 3 of the British Columbia budget of 1982. In 1981-82 this province took in $1.849 million in personal income tax. The minister — with his crystal ball — sat down and said like Pollyanna: "Everything's coming up roses. I'll bet personal income taxes are going to be up again." Now this had to be the only minister in Canada who felt personal income taxes were going to rise instead of fall this year. I don't know anybody who would make that kind of prediction except this government. He predicted that it would go from $1.849 million up to 1.925 million — an increase of 4.1 percent. Do you know any respectable economist in this country who was predicting an increase in income tax revenue for this year?

Let's see what else he did when he got to his revenue side. Sales and fuel tax — that's a big item. We've got $1.618 million in '81-'82. These guys were predicting that for this year it would be up 15.2 percent to $1.864 million. That's an interesting number. Do you really think you're going to have more sales tax when you can't sell any products and people are out of work all across the province? This is the fundamental philosophical flaw in this government. You must have employment and people with money in their pockets to keep this economy going. You don't solve it by throwing teachers out of work and health workers out of work and closing hospital wards.

Let's look at another one. Oh, here's a big item: property taxes. They were going to get an increase there of 31 percent. But I think the most dramatic one of all is in the forestry sector. Who of the forest advisers was he talking to about forest revenues for this year? It wasn't Knudsen. It wasn't anybody we know in the forest industry. It certainly wasn't the president of Crown Zellerbach or anybody like that. But this is what he did on forests. Our revenues in this province from the forest sector in 1981-1982 were $104 million. He estimated $128 million for this year. He estimated an increase of 23.1 percent in forests. Does he never read the Financial Post? He's got to quit reading the National Lampoon. How can anybody be that wrong about forest revenues? In the spring of this year there wasn't a single person you could talk to in this province who didn't tell you the forest industry was on its back, the housing industry had collapsed around the world — particularly in the United States. Everybody in that industry knew it was a disaster, except the Minister of Finance, who called for a 23 percent increase in his revenues for this year.

When you can't predict revenues, you don't know how to run a government. It's that simple. That is fiscal stupidity. If you don't know what you're bringing in, you don't know what you can do in terms of programming. That is why the disaster has been visited upon the province's financial affairs today. They failed to be realistic in their projections of revenue. They are literally a mile out.

I can go through a lot others — they're all equally wrong. They saw sales and service fees going up 26 percent. Licenses and permits — 18 percent. They might have been right on that one; that's something they had a little control over. Do you know what happened? They thought everybody else was going to increase what they paid to the government in the private sector, the non-compulsory side. That would go up just as much as they unilaterally increased their own fees on things.

The disaster we are now looking at in this bill, the disaster that this province is facing now — broke and going into deficit financing — could have been avoided with good fiscal management. I don't think even my chartered accountant friends will believe this statement, when they read it, as an

[ Page 9601 ]

accurate projection. That projection that the minister presented us was about as accurate as the Clarkson Gordon report on the New Democratic Party government.

Imagine predicting a 23 percent increase in forest revenues and nearly a 5 percent increase in personal income tax. How do people on unemployment insurance pay income tax? It is a disaster.

Another question that disturbs me — although I don't know whether it disturbs the public; perhaps they haven't thought about it — is the constant criticism by the member for North Vancouver — I wish he were here — of the terrible federal deficit — a deficit I might add that was, of course, being incurred while he was federal Minister of the Environment. His constant concern about the federal deficit is right. The federal deficit is a really big problem for the country. But you don't help the federal deficit when you go into league with private eastern financial interests so they don't have to pay their federal income tax. That's what this government has done with the ferry system and the buses. It's decided to play the tax-loophole game with the private sector, thereby denying the federal government very substantial revenues to try to correct that imbalance.

The request for some kind of a break on the extent of borrowing is even more important when you can see how far this Finance minister is out in predicting his revenues. Now he wants us to give him carte blanche to borrow as much as he wants on treasury bills. Surely it's asking too much of the members of this Legislature to give him a blank cheque. He told me and every other member of the Legislature, and all of the people of the province, that forestry was going to be up 23 percent this year. Is that the kind of prediction that we're going to have in terms of their capacity to repay that borrowing, when they're that far out in their revenue projections? We'll get the same kind of funny financial statement, the same kind of nonsense, when it comes to their capacity to repay treasury bills.

Interjection.

MR. LEGGATT: I hope the member will take his seat and follow me, and explain how accurate the Minister of Finance was in predicting revenues for the year 1982. Tell me how he was able to predict in the spring of this year that forestry revenues were going to be up 23 percent. Did anybody in the business community take that position that you've heard of? Did anybody in this country predict that personal income tax would rise this year, or predict sales tax would rise in a year of terrible depression? Even the Premier didn't think that. He must have been sold on these numbers. He wouldn't let his Finance minister come in with them. How can you trust a government that's that far out in its revenue predictions with a blank cheque on borrowing? That's what I want to know.

The amendment before the House, a reasoned amendment, an amendment which simply asks for some limit on the capacity of this government to borrow and therefore the capacity to be wrong — which they have been consistently for the last two years — is a reasonable amendment. I can't imagine why the member for North Vancouver wouldn't vote for this amendment. I had the Minister of Finance tell me that we are wildly out and entirely wrong when we said S900 million had been squandered by consolidating special funds into general revenue. And we might be wrong. It could be more like $600 million, not $900 million. but whatever figure it is, this administration has squandered special funds in the last three years to the tune of $500 million to $1 billion. What we have done. Mr. Speaker, is create the non-heritage fund. While Alberta and Saskatchewan have a heritage fund, we have a negative heritage fund. It's been squandered by this administration.

The long-time view of the conventional wisdom in this province that balanced budgets are good and deficit budgets are bad is essentially a correct view. The difficulty with it is that you should not balance annually; you should balance over a period of time, such as the four-year period suggested by the member for New Westminster (Mr. Cocke).

I think it makes a good deal of sense to do cyclical budgeting. I suppose this bill could be explained away as an attempt at cyclical budgeting, but I don't believe it is. I think it is the kind of catch-as-catch-can hodgepodge of non-planning that we can expect from this government.

Interjection,

MR. LEGGATT: That's right. They think planning is originating in Moscow or something.

HON. MR. PHILLIPS: Oh no, it comes out of the Waffle Manifesto.

MR. LEGGATT: How about the London School of Economics, that hotbed of communists? I hear it's a terrible place. People who have been there are the worst kind of raving communists, like Mackenzie King, Keynes, Kennedy — all those terrible, loony left-wingers who have gone to the London School of Economics.

I suggest that the minister try going there once himself; have a visit and see what actually goes on. The London School of Economics deals with economics, and this government doesn't know anything about economics. It's just bone ignorant about the subject. To prattle on about the so-called socialists at the London School of Economics....

HON. MR. PHILLIPS: You say that on the hustings and you'll get defeated, you know.

MR. LEGGATT: I'll say it on the hustings, in the House. In the hall — everywhere. I'm quite proud of the people I know who've been to the London School of Economics. I think they would be kind of unhappy to hear the minister put them all down as a bunch of communist loonies. They aren't. They make a lot of sense. In fact. they are the people who have kept the capitalist system alive in the western world over the last 15 years by distributing wealth and putting it into the pockets of people who can purchase the products of those small business people that this government allegedly cares for. It's purchasing power that we have to have.

This treasury bill, this first touch of the cold water, this first attempt to dive into the lake and try out deficit financing, has not been well thought out. Obviously any government in this province will have to borrow. We are broke. We know we have to borrow: we don't have, my revenues. We have to borrow to maintain a decent level of services. But for this government to borrow would be the same as the New Democratic Party's being against public Medicare. It is the talisman: it is the thing that you've hung your hat on and survived on all these years. They no longer have any reason to exist. Please call an election and let us put you out of that agony.

[ Page 9602 ]

MR. BARBER: In the late 1950s, a fine American writer and playwright put together a work called The Pawnbroker. In the course of this work he examined the attitudes and traditions, he talked about some of the problems and difficulties, mainly from the point of view of those who, when times get tough, have to pawn their assets. He talked about what happens over a period of time to those who get into the habit of pawning their assets in order to meet their current obligations.

In this particular work, The Pawnbroker, we see an illustration of his customers, and we see an illustration of his customers today. This is a government that is taking the province to the pawnbrokers. They are taking the province's assets — the ferries, buses and now, according to the member for North Vancouver–Capilano (Mr. Davis), even more assets — to the pawnbrokers in order to bail themselves out. What's dangerous about that is that first of all it's a dangerous habit to get into. Once you're into it, how do you draw the line and how do you stop? What's dangerous is that they've done this so often already that they have relatively little left to take to the pawnbrokers.

The Minister of Finance, in a pitiful and irrational defence, attempted in question period to explain how it was that somehow simultaneously the government and the private sector could both exploit each other to mutual benefit when the latest assets of the province were taken to the pawnbrokers — in this case buses. Formerly owned by all of us, they are now to be sold to eastern financiers and then sold back to us for an extra $12 million beyond the price we originally paid for them. His argument was basically a sham and a hoax. Intellectually, the argument advanced by this government is a fraud. It cannot be that we benefit by having to pay $12 million more to buy back what we have already bought once. That argument is a fraud, but it's typical of the attitude of those who are prepared to go to the pawnbrokers when times get tough.

Let's talk a bit more about what has happened to the Social Credit Party. If W.A.C. Bennett were alive today he would spit on this bill. If W.A.C. Bennett were alive today he would spit on the coalition that has introduced it, because he would understand that this is a repudiation in its entirety of the fundamental economic strategy which he held to be correct for the people of British Columbia. If W.A.C. Bennett were alive today he would spit on both the bill and the government that has betrayed his legacy, his inheritance an his philosophy. This bill is a massive repudiation of what was, at least for a time, the only unifying principle of Social Credit. They used to call that principle "pay as you go and don't borrow for the groceries."

Another act of legerdemain, another kind of fraud, occurred a short while ago when it was revealed the government had betrayed yet another promise. This was the promise to finance B.C. Rail's development in the northeast on a pay-as-you-go basis. I remember the Minister of Industry and Small Business Development telling us, apparently sincerely, and apparently intent on being believed, that he would finance that railway pay-as-you-go first track to last track. I believed him. I don't think the man is a liar, consciously. But we do know, Mr. Speaker, what's gone wrong with that. In a deceitful and sneaky way, without telling us why, without admitting when, and only finally confessing the what after we pried it out of them, they have admitted they've abandoned the pay-as-you-go philosophy that governed their party, the common inheritance that W.A. C. Bennett left them by way of a philosophical view about public administration.

Once again they've had to go out and borrow a lot of money and redirect a lot more money in order to finance B.C. Rail. If there were circumstances that could justify it, surely those circumstances could be explained. If there were circumstances that demand that change in policy, surely those circumstances are honourable and worthy of public disclosure volunteered by the government responsible for them. But no, this government didn't volunteer that information. They didn't call a press conference to give us that news. They didn't issue yet another press release to tell us they had changed their policy for a good and honourable reason. No, once again it was up to the opposition, the media, and to the financial community to discover that they had repudiated, on one further occasion, a promise, a vow, a commitment, and a policy which they had offered apparently in good faith, and which we accepted in good faith.

That is one of the fundamental contradictions that this government has had to deal with in the last six, going on seven, years. It is, Mr. Speaker, a coalition, it is no longer a single policy, a single party, and a single point of view in government. The tragedy that the real Socreds face in this coalition is that they know full well that they are being forced to adopt Liberal economic policies, Trudeau borrow policies, government of Canada get-into-debt-as-you-go policies, because of the failures of their own administration. The government that is taking the assets of this province to the pawn brokers — the buses, the ferries, and all of the other things that they are now considering; we've heard some of them and we'll be asking about them in question period — is a government that has violated a trust, a government that has betrayed the founder of their own party in this province, the late W.A.C. Bennett.

W.A. C. Bennett would never vote for this bill. He would probably consider this to be a reasonable amendment. W.A.C. Bennett would never have allowed this province to get into that position.

Interjection.

MR. BARBER: We don't love W.A.C. now, Mr. Member, but we respect him for being a man of principle who honoured his promises and kept them for 20 years. For 20 years, at least, he was consistent, honest, plain and straightforward about his philosophy of government. You are nothing better than opportunists. You are nothing better than a member of a coalition that cannot even make the pretence of a philosophical approach to government. We honour any adversary who is honest and consistent, and W.A.C. was that.

Interjection.

MR. BARBER: Don, please, sober up.

The Minister of Forests (Hon. Mr. Waterland) a year and a half ago said that a year ago this month the forest industry would recover. I have a statement that you made a year and a half ago in which in your typically inept way you said that the forest economy of British Columbia would recover in the fall of 1981. In reply to my colleague from Coquitlam, who asked where the Minister of Finance got such bad advice, let me remind you and advise the House that a year and a half ago the Minister of Forests publicly said, on the basis of his

[ Page 9603 ]

apparent ability to predict these things, that the forest economy would recover starting in the fall of 1981.

Interjection.

MR. BARBER: Bad forecast? It's typical of a bad government unable to handle even its own books, much less the books of the people of British Columbia.

This bill is an admission of catastrophic failure on the part of Social Credit. They have squandered, wasted, misspent, misappropriated and misused public funds for almost seven years.

SOME HON. MEMBERS: Order!

MR. BARBER: What do you mean, "Order"? If your government, your financial house, were in order, you wouldn't have to present this bill today.

Interjections.

MR. SPEAKER: Order, please, Hon. members, the Chair observes that the Minister of Industry and Small Business Development (Hon. Mr. Phillips) has not yet taken part in the debate. If he wishes to do so he will have his opportunity.

HON. MR. HEWITT: On a point of order, I'd ask the member to withdraw the inference that there's been a misappropriation of funds by this government. It's unparliamentary.

MR. BARBER: There certainly has been. What are you talking about?

MR. SPEAKER: Order, please. If an imputation was made directly toward any specific member of the government, the withdrawal must be made. If that is the case, I would ask the member to withdraw,

MR. BARBER: It wasn't the case and I don't withdraw it, because there was no reference to any minister. However, the government as a whole has misappropriated public funds. Let me illustrate and use your own words to do so. Let me refer to a commitment made by the Minister of Industry that....

HON. MR. HEWITT: Do you want to lay a charge?

MR. BARBER: It's not a criminal offence I'm referring to.

HON. MR. HEWITT: Misappropriation of funds?

MR. BARBER: Misappropriation, that's right, We appropriate money in this Legislature for specific purposes. We do that with the power and the authority of law. The appropriation process in Committee of Supply is a process that you understand and that I do too. What happens when you take the money we appropriate for one purpose and spend it on another that we did not approve is misappropriation of funds. Let me give an illustration of how it worked.

Interjection.

MR. BARBER: Lay a charge? It's not a criminal offence. It may be a political offence to people who care about the process of appropriating public funds for a specific purpose. Although you may feel embarrassed, as you should, the fact is it's not a Criminal Code offence. It is, though, an offence, I think, to the procedure in this House, which holds that the Legislature appropriates money to the Crown upon the request of the government. We both know that's how it works.

What you quite clearly did, in the case of northeast coal, was to misappropriate money that we had committed for one purpose and convert it to another, and the way you've done it is through the costs you allocate and attribute to B.C. Rail. This was a project that you said would pay its own way from beginning to end. We never appropriated a nickel in this Legislature for a policy or a budget that saw B.C. Rail being financed by borrowings and by consolidated revenue. We were told by your colleague that the B.C. Rail development in northeast coal would be pay-as-you-go. That was a commitment made to us in a budget debate two years ago and again last year, and to the people, through the appropriations that were voted in this chamber. When you turn around, repudiate that process and re-appropriate that money. you have done something contrary to the express will of this Legislature. I call that misappropriation of funds from beginning to end.

HON. MR. PHILLIPS: Shame on you, Charlie.

MR. BARBER: Shame on you for having done it, for having tried to cover it up. and for leading and participating in a government so inept. so unable to administer, so careless of the public funds, that you have driven the province to the position it's in today, where you need to borrow for operating costs.

Interjections.

MR. BARBER: What do you mean, "Get out of the gutter"?

MR. SPEAKER: Order, please. Hon. members. If the member speaking would address the Chair, and the other members would contain their interjections, we might slowly wend our way through this debate.

MR. BARBER: I would address the Chair always, Mr. Speaker, but I saw you dozing off and I didn't want to wake you up.

Interjections.

MR. SPEAKER: Order, please. The Minister of Industry and Small Business Development will either come to order or leave the chamber. This is the last time. I would ask the first member for Victoria to withdraw his remark to the Chair. I may have to sit here, hon. member, but there are certain things I don't have to do, and one of them is consider remarks like that.

MR. BARBER: Of course — it was meant as a friendly joke. Mr. Speaker.

MRS. JORDAN: What a sense of humour!

[ Page 9604 ]

MR. BARBER: Well, it's certainly not his or yours, and I'll certainly withdraw it.

Let's talk again about the principle of the amendment. This is an attempt to place a ceiling, a limit....This is an attempt to exert the prerogatives of the Legislature. It's an attempt to protect the public interest by establishing upon motion a commitment that this government will not be allowed to break the bank in British Columbia. The bill this government has put forward allows Social Credit to borrow any amount for any purpose for any period of time. It's as simple as that. In plain simple English, in straightforward language, it makes it perfectly obvious that this government may vote any amount for any purpose for any period of time, and may go to public borrowing in order to finance what they wish. It's not acceptable. Again, if W.A.C. Bennett were alive, he would repudiate that absolutely. In fact, when W. A. C., Bennett was alive, he passed a bill to outlaw the kind of policy that the coalition now wishes to endorse. In 1960 — if I recall the year correctly — W.A. C. Bennett passed a bill that would once and for all establish a policy that would forbid governments from borrowing any amount for any purpose for any period of time. Socreds who were here then are going to have a very difficult time voting for this bill today. You'd think they could not countenance such a complete, arrogant and obvious reversal of policy. Either you believed it once or you believed nothing. Either you held it to be your philosophy then or you admit today you have no philosophy at all. Either you held it then as a belief, a constant and a statement of public policy and you meant it, or you mean nothing at all at any time.

This government got elected parading as a party of competent business people. In the last seven years that image has been by and large undermined. This is the government, after all — briefly — responsible for the Marguerite fiasco, the Seaboard fiasco, and what used to be known as the Ministry of Deregulation. Any government that's capable of those stunts, any government so inept as to be held accountable for something the Premier boasted about — the Ministry of Deregulation, which would "free business from the shackles of government" — and then turn around and wreck a business by putting it out of business through mistaken legislation.... Any government capable of that magnitude of error is no longer capable of parading about as a party of competent business people.

My colleague from Coquitlam has demonstrated, using the language of the minister himself, how totally wrong his major predictions were in the budget speech he made. My colleague from Coquitlam has demonstrated how completely wrong has been the financial house of cards upon which they've set their future.

The people of British Columbia will demonstrate how completely wrong it is for this government to govern with the presumption that they have the confidence of the people of British Columbia anymore. This is the worst and the most inept group of businesslike bunglers this province has ever suffered under. Any business run as badly as this province has been run by Social Credit would be out of business altogether by now.

Any business that had to labour under the incompetent administration, the inept forecasts and the waste of public funds — the waste of funds for any purpose — that we've seen Social Credit be responsible for would long ago have been bankrupt. The government capable of Seaboard, the government capable of the Marguerite, the government capable of the heroin treatment plan, the government capable of the Ministry of Deregulation fiascos, and the government capable of the mess called BCRIC now asks us to trust them. They ask us to sign a credit card and turn it over to them. They ask the people of British Columbia to allow it to happen. We don't trust a government that's capable of doing something like BCRIC. We don't trust a government that's capable of accidentally wiping out the Seaboard insurance company. We don't trust a government that's capable of bringing in something as completely unworkable and wasteful as a heroin treatment program. We don't trust a government so inept as to screw up for a year tourism between Victoria and Seattle by their mishandling of the Marguerite, the Rupert, the Surrey and the jetfoil. Any government capable of all of those mistakes is not to be trusted with a credit card.

You are not trusted by us. You are not trusted by the majority of the people. You are not trusted even by those whom you consult in the Premier's office: Mr. Spector and Mr. Kinsella. They know full well what's gone wrong with your strategy, and about the chicken dance that the Premier has done for the last three weeks on the question of an election. It's further evidence of the disarray in which they find themselves in the polls. You are not trusted by the people of British Columbia. You are not trusted by the members on this side of the Legislature. We don't trust you when you ask us for a credit card that will allow you to borrow any amount for any purpose for any period of time.

We move this amendment — I trust, to the distaste of the partisans opposite — as a gesture, a method and a symbol. The gesture says that we want accountability; the method says that this is how we'll find it; the symbol says that you are not to be trusted with unlimited borrowing authority. You have already done so much damage to the people that we do not wish to allow you to do further damage in the future. You are not competent enough; you are not careful enough. You are not cautious enough with the public funds. You are not responsible enough to be trusted with this authority, and we wish to deny it to you. The means of doing so are by now asking the House to approve the amendment that we put forward.

Amendment negatived on the following division:

NAYS — 28

YEAS — 21

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

[ Page 9605 ]

MR. SPEAKER: The minister closes debate.

HON. MR. CURTIS: The question of treasury bills has been dealt with at some length over this portion of the session. I think it's important to focus on two or three key elements which are involved in the use of treasury bills. and at the same time to examine that which occurs in other parts of the country.

The members opposite have pointed out — with some repetition in recent days, when debating this and the amendment just disposed of — that somehow treasury bills are inappropriate; they are something invented by this government at this particular time. The fact remains, as I believe I indicated in opening of second reading. that five provinces embarked on the treasury bill mechanism, or make use of it on a regular basis. From east to west these are: Newfoundland, Quebec, Manitoba, Saskatchewan and, most recently, Alberta. Alberta, it should be observed, returned to treasury bills after an absence of some three years, I believe — or four years perhaps — in June 1982. In addition, the federal government utilizes this particular procedure. Nonetheless, for those objective viewers of the situation, I think the most important aspect is the fact that the province of Alberta did return to treasury bills, as I indicated, just in late spring of 1982.

The fact is, we are amending the Financial Administration Act, and this permits the treasury bill operation to be maintained for a period in excess of 365 days. I think it is unlikely that you would see the utilization of this particular form of financing for much more than 365 days. We can discuss this more in committee, because I realize it is an amendment to section 43. It is not unrestricted borrowing. as the amendment proposed. I simply want to make that observation without again interfering with the rules of this House in terms of an amendment that has been voted on.

Of necessity, the treasury bill issue must reflect that which has been voted by the Legislature for the year in question. Next, with quarterly reporting, which this government put in place, there is the ability for all interested British Columbians and members of this House to analyze our progress through the course of a fiscal year. Then, while some of the debate made little of it — I was going to say light, but little — we have the auditor-general. I believe that is still one of the most significant steps taken by this government leading up to the 1975 election, and imposed; imposed on ourselves and imposed on those who follow in years to come in this particular province, in order that the auditor-general can, as she does quite frequently, observe where we can tighten up on our expenditures.

The discipline has been imposed on the system — not just on this government, but on the system: on those who manage in government, on those who are charged with the expenditure of public funds in one way or another. Whether in a small branch of a relatively small ministry, or in a very large branch, a very large section of a major ministry. the fact is that consciously, through the course of the year, those individuals are aware that ultimately the auditor; general and her staff are going to examine that money which has been approved by this Legislature, has been voted in the course of Committee of Supply and is finally approved in a supply bill think that that is the ultimate control which the people of British Columbia expect, and in fact which the people of British Columbia demand.

Some of the debate spoke of no accountability, credit card, blank cheque. I remember the member for Coquitlam-Moody (Mr. Leggatt) and the member for New Westminster (Mr. Cocke) as well.... I think the member for New Westminster pulled out something simulating a cheque-book and appeared to write a blank cheque. Mr. Speaker, that cannot happen. I trust that those who sit opposite, and those who are examining this new feature in terms of financial operation in British Columbia. understand that it cannot, it will not and it does not happen with the treasury bill process. Again, Mr. Speaker, as you know and as members know, this Legislature is supreme, and it says: "You may have government. You may have this much money and no more." The treasury bill mechanism is simply to give us an opportunity — in the event that it is appropriate to use — to implement a system which has not been used in British Columbia but which, I said earlier. has been used and continues to be used by a number of other jurisdictions in Canada.

I indicated the 365-day question. Clearly in our discussions with other jurisdictions and in our examination of treasury bills it has to be understood — if I may make the observation — that if a province introduces a treasury bill operation the market itself demands that it exist for a longer period than one year. Now this is not the actual bill that is issued, but the system itself, because investors look to a continuing availability of treasury bills of an issuer. So I would think that once the market is established it will be a very popular market British Columbia treasury bills will be well received on the markets of Canada. There is no question about that: they will be popular instruments. Mr. Speaker, we cannot turn this market on and off like a tap, because to do so would be inappropriate and would indicate that we do not intend to continue some utilization of this particular mechanism.

I look forward to further debate in committee on the specifics of the treasury bill operation. At this point, having heard a fair amount of repetitious debate, including Seaboard — I do not fully understand how that fits into this particular legislation — I therefore move second reading of Bill 86.

Motion approved on the following division:

YEAS — 28

NAYS — 20

[ Page 9606 ]

Bill 86, Financial Administration Amendment Act (No. 2), 1982, read a second time.

HON. MR. CURTIS: Mr. Speaker, with leave, I move that the bill be referred to a Committee of the Whole House to be considered now.

MR. HOWARD: You can do that tomorrow.

MR. SPEAKER: Leave is denied, hon. members. Mr. House Leader.

HON. MR. GARDOM: I move the House do now adjourn.

MR. SPEAKER: You've heard the motion. Those in favour say aye.

Interjections.

MR. SPEAKER: Order, please. Before that motion is entertained I recognize the Minister of Finance, who rises on....

Interjections.

MR. SPEAKER: Order, please. I have recognized the Minister of Finance.

MR. HOWARD: Mr. Speaker, point of order.

MR. SPEAKER: One point at a time, hon. member. I have recognized the Minister of Finance.

HON. MR. CURTIS: Mr. Speaker, on a point of order, did I take it that leave was not granted with respect to committal?

MR. SPEAKER: That was the observation of the Chair upon....

HON. MR. CURTIS: Mr. Speaker, I said: "With leave, can the bill be committed to a Committee of the Whole House now?" I did not hear any noes, Mr. Speaker.

Interjections.

MR. SPEAKER: Order, please. Hon. members, if we are to proceed at all, shall we at least hear the various points of order that are going...?

HON. MR. CURTIS: Continuing with the point of order, I did not hear noes, nor did I hear your comment with respect to whether or not leave was granted. I have to repeat my earlier inquiry of the Chair. I asked if, with leave, the bill could be referred to a Committee of the Whole House for consideration forthwith. I did not hear any noes. I look to the Chair for guidance. I did note the member for Skeena (Mr. Howard) on his feet, but I did not hear what he said, if in fact he said anything.

MR. SPEAKER: Hon. members, if the Chair may be permitted an observation, it is that I need a moment to....

MR. NICOLSON: Let me help you.

MR. SPEAKER: That would indeed be refreshing.

MR. NICOLSON: Mr. Speaker, we have a problem here. There is a motion for adjournment. I suggest that the remedy would be to defeat the motion for adjournment, if the government side wishes to defeat its own motion. They can defeat the motion for adjournment, and then we could carry on.

MR. SPEAKER: Hon. members, the fact is that while leave was asked, it was not granted. I believe the Chair made the observation that leave was not granted. If it was anyone's fault, it was partially the Chair's fault in prematurely recognizing the House Leader. However, the remedy suggested by the member for Nelson-Creston (Mr. Nicolson) might have some merit if we were to proceed to defeat that motion and proceed to the motion which the Minister of Finance would then subsequently make. That is the recommendation from the member for Nelson-Creston.

MR. HOWARD: Then what you have done is recognized the government House Leader, and you have accepted his motion to adjourn, and we have a vote on that. If that's what you're suggesting we do, I suggest we do that. I submit that once having done that, we are not then able to go backwards and assist the Minister of Finance in recouping the stupid position he finds himself in because the government House Leader has already moved that we adjourn — and that kills the bill, in my view.

Interjections.

MR. SPEAKER: Order, please. Hon. members, it is the ruling of the Chair that the motion of the House Leader could not be accepted by the Chair until the matter of the previous disposition of the bill has been disposed of.

Interjection.

MR. SPEAKER: There's no point of order, hon. member. You may challenge the decision, but that is the decision of the Chair.

MR. BARRETT: On a point of order, Mr. Speaker, this is a brand-new ruling. The Chair is saying that it's in error. There's no precedent for that. The member obviously made the motion for adjournment, the government got in a jam, and now they're looking for a way out of the jam. I suggest that if the Chair is admitting that it made a decision to accept the motion and that the decision is politically unacceptable, the Chair should resign rather than place the Chair in the question of being used politically. Making a ruling of yourself makes a mockery of all the rulings in this House, based on his motion that we were to vote on. They goofed, and you have no right to pull them out of the goof, because you put into question your whole performance from now on.

MR. SPEAKER: Don't lecture the Chair, hon. member.

MR. BARRETT: I can so!

MR. SPEAKER: No, sir. You may not.

[ Page 9607 ]

MR. BARRETT: You're the one who just said that you'd change your mind on a ruling.

MR. SPEAKER: Order, please. I've heard the point of order.

MR. BARRETT: Absolutely silly!

MR. SPEAKER: Order, please. The ruling....

MR. BARRETT: They sold out.

MR. SPEAKER: Order, please, hon. members. The ruling of the Chair is as it was mentioned prior to the point of order raised by the Leader of the Opposition. That is the ruling of the Chair.

Interjection.

MR. SPEAKER: The member for Skeena rises on....

SOME HON. MEMBERS: On what'?

MR. HOWARD: If that were any of your business, I'd tell you on what. Listen and pay attention.

SOME HON. MEMBERS: Oh, oh!

MR. SPEAKER: Order. please.

MR. HOWARD: Mr. Speaker, it is not the business of cabinet ministers why I rise: its the business of Mr. Speaker. That's why I told them it wasn't any of their business. It is your business.

The point I want to raise with you, Mr. Speaker. Is that once Mr. Speaker has taken a partisan sell-out position such as...

MR. SPEAKER: Order, please.

MR. HOWARD:... Mr. Speaker has done in this instance, consciously, deliberately partisan, to support the government, then there is no choice but to....

[Mr. Speaker rose.]

Interjections.

MR. SPEAKER: Order. please. I must ask the member for Skeena to withdraw the remarks that he made toward the Chair. If the member is unhappy with the decision of the Chair, he knows which proper course he may take: he is also familiar with what course he may not take, which is what he has just taken. I would therefore ask that the member withdraw his remarks. If he is unhappy and wishes to proceed further, he has an alternative at his disposal. but I must ask now that he withdraw the remarks to the Chair.

[Mr. Speaker resumed his chair.]

MR. HOWARD: Those remarks, Mr. Speaker, were a verbal indication of a notice of motion which is going on the order paper against yourself.

MR. SPEAKER: I ask the member to withdraw.

MR. HOWARD: If you ask that I withdraw them verbally, I will, and they will appear in writing.

MR. NICOLSON: On a point of order, may I draw your attention to standing order 9, which says that Mr. Speaker, "when explaining a point of order or practice...shall state the standing order or authority applicable in the case." There's been no citation given: this is an absolute departure from anything that's ever been presented in this House. A motion to adjourn is always in order and shall be put forthwith without debate.

HON. MR. CURTIS: Mr. Speaker. I move that Bill 86 be referred to a Committee of the Whole House to be considered at the next sitting of the House after today.

Motion approved.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 5:45 p.m.

[ Page 9608 ]

Appendix

AMENDMENTS TO BILLS

88 The Hon. L. A. Williams to move, in Committee of the Whole on Bill (No. 88) intituled Miscellaneous Statutes Amendment Act (No. 3), 1982 to amend as follows:

SECTION 47.1, by adding the following section:

"Utilities Commission Act Amendment

"47.1 Section 133 (2) of the Utilities Commission Act, S.B.C. 1980, c. 60, is amended by striking out 'means' and substituting 'includes'."

SECTION 48 (1), is deleted and the following substituted:

" (1) Sections 11, 18 and 20 come into force on proclamation."