[ Page 171 ]

CONTENTS

Routine Proceedings

Budget debate

Mr. Stupich –– 171

Mr. Reynolds –– 181

Mr. Lea –– 186

FRIDAY, JULY 8, 1983

The House met at 10:06 a.m.

Prayers.

MR. REYNOLDS: I'd like to introduce a gentleman in the gallery, Mr. Bill Anderson, who is a director of Metro Transit, chairman of the natural gas conversion committee and a member of our constituency association who worked very hard on my election.

MRS. JOHNSTON: I would like to ask the members to join me in welcoming one of my constituents, Mrs. Jean Eddington, who is here with us this morning.

MR. REYNOLDS: I just noticed in the gallery, and I would like the members to welcome, my two daughters: Kelly, who is 14, and Katie, who is 10.

MR. CAMPBELL: I'd like you to welcome my wife, Isabel Campbell, here from Vernon this morning.

Orders of the Day

ON THE BUDGET

MR. STUPICH: I've been asked just how long I might be this morning, and may I say I haven't had time to make a short speech. The Minister of Finance has had some 16 months to prepare his, and I must compliment him. It was shorter than usual. But in the hours between the time he finished and the time I'm starting this morning, there really hasn't been time to develop a short speech. I guess we'll find out together just how long it will be.

[Mr. Strachan in the chair.]

Certainly, we've heard that the budget that we were presented with yesterday was at least the second — perhaps more than the second — budget that was prepared for presentation for the year 1983-84. The Premier told us once the election was over that it was back to the drawing boards, and they were going to redraft the budget that had been prepared in the event that the budget was presented before the election was called.

Doubtless, the architects of the July 7, 1983, provincial budget regard yesterday's package as a grand design for the future. Well, the package may, in its own way, be as radical as any ever presented to this Legislature. It must be recognized for what it is: accidental Reaganism. After all, the government has backed its way slowly but surely into a position where it is completely convinced it must turn sharply to the right. It believes it has a mandate — an instruction — from the electorate to do that. The budget is couched carefully in the rhetoric of the new right imported from the United States, and from Great Britain a few years later.

It is really not what it seems to be. There is no sense in which the electors of this province voted for some of the propositions contained in the budget that was presented in this Legislature yesterday. Not to impute motives, Mr. Speaker, this budget is based on a big lie, or more precisely, the big lies.

[10:15]

The first big lie is that restraint leads to economic recovery. Restraint is, of course, many things to many people, but it is not a formula for economic recovery. The budget will result in a downward pressure on economic recovery, both from tax increases and direct job loss to the economy. The second big lie, which I will deal with in some detail in my following remarks, is to say that the government has no choice.

As for the assertion that this package was supported by the electorate in the recently concluded election campaign, the facts show otherwise. It is true that during the election campaign the Premier made vague references to continued restraint. It is also true that the Social Credit Party promised a total of — and I chuckle at this one — $1.474 billion in new spending; that's why I say "vague references to restraint." When you talk out of one corner of your mouth about restraint, and out of the other comer about new spending of a billion and a half dollars, all I can say is that it was a vague reference to restraint.

It is also true that the Premier promised no tax increases for a year. It is also true that the Minister of Health (Hon. Mr. Nielsen) promised no increases in health user fees. So much for Social Credit election promises. We should all understand the budget to be a manipulation of an election mandate.

There are obvious election debts to be paid, most notably to property owners and property developers. These are being paid handsomely in the budget presented yesterday. There is no other explanation for the proposed sacrifice of farmland and tenants' rights, all of which were proposed yesterday.

There is a measure in this budget of the government helping its friends and disarming its perceived enemies. The right-wing rhetoric of Reaganism provides a convenient cover or, as David Stockman said, "a Trojan horse for hardball politics." Niccolo Machiavelli, the father of hardball politics, described the situation of the present government exactly. His advice to the usurper was "to examine closely into all those injuries which it is necessary for him to inflict, and to do them all at one stroke so as not to have to repeat them daily.... For injuries ought to be done all at one time, so that, being tasted less, they offend less; benefits ought to be given little by little, so that the flavour of them may last longer." That's taken from The Prince, pages 72 and 73. If the members opposite haven't read Machiavelli they don't have to, because they might have written a good part of it yesterday.

In my remarks today, Mr. Speaker, I will turn first to the budget year concluded March 31, 1983. I will then review the economic context of yesterday's budget and some of the major elements of the budget proposals. Finally, I propose to examine some elements of public policy which are missing from this budget and which are needed to secure our economic future.

First, to deal with the budget in review, the budget year just concluded highlights the credibility problem of the Ministry of Finance under its present leadership. Never in the history of the province of British Columbia have revenues been overestimated anything in the remote vicinity of the $872 million of the year just concluded. On April 5, 1982, the Minister of Finance had the gall to issue a statement under his name that he had produced an operating budget balanced by revenues. Figures released with the budget yesterday prove the utter falsehood that was presented to the people of British Columbia by the Minister of Finance on April 5,

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1982, when he produced that budget — a budget which deliberately overestimated revenue by almost $1 billion. For a minister in this day and age to be wrong by almost $1 billion in the accounts of the province, with all of the assistance and experts that he has, and the fact that budgets are coming later and later — for him to be that far wrong in calculating revenue, with an error of almost 15 percent, a figure far out of proportion to any such mistake made by any Minister of Finance in any provincial government in this history of Canada — proves that this minister produced a political document rather than an estimate of government revenues.

The Minister of Finance, with this admission, has destroyed any credibility he might have had in financial circles. He has proven that he is willing to take political direction from the Premier to produce a political document, rather than a budget which can be depended upon by the citizens of British Columbia and by investment people worldwide. For the sake of an election ploy the credibility of B.C. budgets has been sacrificed, and that will hurt our province for a long time to come.

The only recourse, if the minister has a shred of honesty left in him....

DEPUTY SPEAKER: Hon. member, we are really starting to offend some of the parliamentary rules about referring to other hon. members. I'm sure the hon. member for Nanaimo is quite aware of parliamentary rules.

AN HON MEMBER: Quite aware.

DEPUTY SPEAKER: Order! I'll ask all hon. members to come to order, please.

MR. STUPICH: Mr. Speaker, I'm certainly not attributing any motives to the particular individual who sits in that chair. What I am talking about is the position of Minister of Finance. My concern is that the evidence produced by the Minister of Finance proves to me, and to anyone who will read last year's budget and this year's budget, that the Minister of Finance took political direction from the Premier. That is my point — not, certainly, that the individual has erred in any way.

The only recourse left to the Minister of Finance to re-establish some credibility for the finances of the province of British Columbia in British Columbia, in Canada and in the world is for that minister, who has taken political direction, to resign as Minister of Finance.

All of the fancy Social Credit bookkeeping in the world can no longer hide the fact that the minister's budget was out of whack by almost a billion dollars. Elementary logic shows that it is impossible to have a rational debate without having a common base. Without agreement on the facts, rational discussion is impossible. The Minister of Finance has poisoned the atmosphere of debate surrounding the economy and government finances by consistently and persistently producing budget statements which are not borne out by reality — four years in a row. Even the minister's most loyal fans and supporters must wonder why the minister's budget statements are so routinely at variance with the year-end performance. In fact, the first three years of the minister's performance have shown an appalling failure to be anywhere close to the mark.

In the March 11, 1980, budget speech, page 14, the minister told this House: "In the 1980-81 fiscal year, budgetary revenue is expected to exceed budgetary expenditure by $250 million." At the end of the year, the figures produced by the government show that the government had depleted government financial reserves by $313 million. This was a major shortfall at a time when the economy was booming, in the minister's own words. Deficit financing was neither required nor desirable.

On March 9, 1981, the minister told this House that he was bringing in tax increases in the amount of $625.2 million in order to balance the budget. That was in the 1981 budget address on page 12. The 1981-82 fiscal year pushed B.C. a further $356 million into the red. While there were economic storm-clouds on the horizon at the outset of the 1981-82 fiscal period, it looked like a pretty good year economically for British Columbia. Unfortunately the economy quickly got very much worse. It was driven downward by the $625 million in tax increases that I have just referred to. As the 1981-82 fiscal year continued, the minister sought vainly to salvage his budget by bringing in non-budgetary measures of all kinds. By various accounts the minister increased between 390 and 1,200 different licences and user fees — tax increases by any other name — in an effort to bring his budget into balance. The exercise failed. The province slipped a further $356 million into the red. Then the minister had the gall to bring in the fraudulent budget estimates. Certainly the estimates were fraudulent; certainly the budget was, not the minister himself but the political document he brought in on April 5, 1982.

Last year's budget — as said some 15 months ago — was a phony, baloney budget. It grossly overestimated revenue. It overestimated economic activity in the province by a factor of some $4 billion, despite a multitude of respectable economic forecasts both inside and outside the government.

HON. MR. PHILLIPS: No wonder you've slipped from 16 to 15 percent.

MR. BARRETT: We don't do it by lying.

MR. SPEAKER: Order! The minister and the Leader of the Opposition will come to order. The member for Nanaimo will continue uninterrupted.

MR. STUPICH: Mr. Speaker, I don't know what I'd do without your help.

The minister had already increased every licence and user fee in sight. He had already increased taxes. His government was facing an election. There was nothing else to do. So he continued in comfortable pursuit of a political fib — or, rather, several — which developed over the course of the year.

Outside investors must surely be aware what to expect when a budget is brought down in British Columbia under this administration. They see what they will always see from this minister, under the direction of the Premier. They see a budget which may or may not look good on paper, depending upon the political purpose of the day. But the fact remains that the credibility of B.C. budgets has been sacrificed by this minister, and that will hurt our province for a very long time to come — long after this minister has gone from office. We must begin the process of healing this damage. There is no

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other way to do that than for the minister to resign and for a new minister to begin repairing the damage.

Mr. Speaker, prior to the last four years budgets were being presented by a chartered accountant; now it's done by a professional politician. When the chartered accountant left office, we started going in the hole. We've been going in the hole ever since.

We must begin the process of healing this damage. The Minister of Finance in this province is the last Minister of Finance in this country to bring in a budget this year. It is the latest provincial budget on record. The budget year just concluded was inaccurately presented, was left in place long past the point where it had any credibility, and has produced an ocean of red ink, the like of which this province has never seen before, even in the hungry thirties. The minister has produced a legacy for which there can be no appropriate emotion but shame.

[10:30]

Mr. Speaker, I wonder what emotion comes to the minister's mind when he reflects on the following words which he uttered on CBC radio on the morning of April 26, 1982: "1 think we will see the budget on both sides — revenues and expenditures — will stand the test of balance of this fiscal year." It doesn't matter how naive the minister really is in his heart of hearts; he has experts. Naivety? He has experts. He has access to the best information money can buy, because the Ministry of Finance has spent money, under his direction, on a scale never imagined before in British Columbia. He has spent public money on some of the most outrageous things ever imagined in respect of the Ministry of Finance in the province.

Let's talk about spending priorities. The present government came to office at the end of December, 1975, seven and a half years ago — December 22, to be exact. I see applause from the government side. Let's see what's happened since then, Mr. Speaker. During that time it has, as I've said on previous occasions, racked up budget deficits totalling $1,647 million to the end of the last fiscal year — quite a record.

MR. REID: Well, we didn't lose $100 million.

MR. STUPICH: The member talks about losing $100 million; I'm talking about losing $1, 647 million. On the dubious assumption that yesterday's budget estimates are correct, that figure should be increased by some $400 million to date in this fiscal year, for a total budget deficit of some $2 billion. That's on the dubious side. In addition it has gone on a spending spree of horrendous proportions through the Crown corporations.

In the first 104 years of this province's history, from 1871 until the end of 1975, guaranteed borrowings of Crown corporations and agencies — no direct debt by the end of 1975 — totalled $4,425 million. That equalled approximately $1,800 per capita. Significantly, there was no direct debt when this government took office on December 22, 1975. As at March 31, 1983, the direct debt of the province stood at $889 million. The debt of Crown corporations and agencies, meanwhile, had jumped to $11,118 million. In other words, total provincial debt, which stood at $4.4 billion when they took office in December 1975, by March 31, 1983, exceeded $12 billion. This is equivalent to $4,274 per capita. I don't think the significance of this slide into the ocean of deficit and debt financing is fully appreciated by British Columbians.

The Minister boasted in his address yesterday — and I believe "boasted" is the appropriate word — that expenditures in the Ministry of Human Resources had increased by 32.9 percent. He again boasted of a further 13.9 percent increase in the current year. These expenditures are wasteful of precious taxpayer dollars. They are wasteful of lost production, lost wages and lost spending in our economy. They betray and deny the role of government as an innovator and catalyst for economic development. They turn the public sector into the public dole. They maintain individuals — because maintenance is not a livelihood — instead of helping them to develop into human beings.

Ultimately this process turns in on itself. Welfare spending begets deficits, tax and fee hikes, program cuts and more shrinkage in the economy — and on and on it goes.

This minister, in the last two years in particular, has taken a most irresponsible course: that of widespread tax increases and wasteful spending on high-priced political hacks, foreign travel and welfare. It has led British Columbians down a path of economic decline. How many British Columbians realize that this restraint-preaching, sanctimonious government opposite, which wants to be thought of as businesslike, has managed in seven and a half years to triple the debt of the previous 104 years? Mr. Speaker, were you aware of that? One hundred and four years of Liberal, Conservative, Social Credit and NDP governments produced a total of $4.4 billion in debt. Seven and one half years of this group has very nearly tripled that figure: $12 billion in debt in seven and a half years.

And how many times over will we repay that debt in interest costs before it is retired? Remember the lectures we used to get about the cost of interest, Mr. Speaker? How much money is paid out of Crown corporations, agencies of....

HON. MR. PHILLIPS: You haven't got much debt on your hotel in Nanaimo, because no one would give you the money — Comrade Hilton.

MR. STUPICH: Mr. Speaker, I'm not sure that this is the correct chamber in which to be discussing that problem. If the Minister of Industry and Small Business Development (Hon. Mr. Phillips) and the Minister of Tourism (Hon. Mr. Richmond) want to have a discussion of that project, I'd be very happy to meet and discuss it with them. I think this is not the time.

Interjections.

MR. SPEAKER: The Minister and the hon. member for New Westminster (Mr. Cocke) will come to order, please.

MR. STUPICH: How many times over will we repay that debt in interest costs before it is retired? How much money is paid out of Crown corporations, agencies of government and tax dollars voted by this Legislature to repay that debt? I doubt somehow that the Minister will answer these questions. What have we got for the money? Can the Minister stand up in this House and explain the value received for the additional $7.7 billion in debt racked up by this government to the start of this fiscal year? This is to say nothing of the additional $3,861 million the government plans to borrow in

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the year we are now in, 1983-84 — an additional almost $4 billion. That's almost as much in one year as 104 years of government in the province of British Columbia had accumulated.

What exactly, Mr. Minister and Mr. Premier, have we got for this money? According to the throne speech, we have got "an intrusive and overweight public sector." The budget tells us that unnecessary government expenditure is to be reduced. One wonders just who has headed the government in the province of British Columbia for the past seven and a half years when all of the "overweight" developed. Who was the government? It certainly wasn't the NDP. The government fails to realize that some of the wasteful expenditures of the past have contributed to a deterioration of the province's financial situation. The financial situation has crippled the government's ability to manoeuvre. Thus, the Minister of Finance, with an apparently straight face, stands up and tells us the terrible choices are tax increases or severe cuts in economic and social programs. The government also fails to realize that past fiscal policies, the irresponsible course of widespread tax increases in an economic downturn and failure to pursue job creation have contributed to the cost of government in an enormous way.

The employment picture in British Columbia is abysmal and getting worse. In 1982 there were 64,000 jobs lost in the province of British Columbia. Unemployment was pushed beyond 200,000. The lost wages of these 64,000 people translate into more than $1.4 billion. Local economies lost almost....

Interjections.

MR. STUPICH: The Premier and the Minister of Economic Development again are urging me to talk about a project that I've been trying to further in Nanaimo. I suggest again that I'll be quite happy to talk to them. I think this isn't the time.

Local economies lost almost $2 billion that would have been generated if these people were employed.

We could talk about the way in which the government has held up that project in Nanaimo, but again, I think this isn't the forum for it.

In the Conference Board in Canada's quarterly provincial forecast, the loss of employment in B.C. is noted. The Conference Board's expectation for 1983 is that B.C. employment will fall at least another 1.5 percent. The minister forecast yesterday zero employment growth for 1983. In 1982 unemployment insurance payments exceeded the payroll for both mining and forestry, our great resource industry. An average of 163,000 people were receiving unemployment benefits. This ranked the UIC payroll as the number two industry in the province in terms of employees on the payroll, behind retail trade and just ahead of accommodation, according to the B.C. Central Credit Union. This figure of 163,000 people does not reflect the size of the unemployed population, since there is another group who have exhausted their unemployment benefits and are now receiving social assistance. In the mining industry, 30 to 40 percent of the workers are unemployed in the producing sector. That is what "the friends of mining" have done for mining.

Exploration is down 40 percent. The outlook for 1983 is a further 30 to 40 percent increase. In forestry 25,000 people were receiving unemployment benefits in 1982, compared to 7,000 the previous year. The Conference Board in Canada forecast predicts that unemployment in British Columbia will be comparable to Canada's highest levels in the Atlantic provinces and Quebec. Further, it is forecast that many workers will not be rehired, even when the economy does turn around. Clearly, Mr. Speaker, this government has not met, and now hopes to ignore, its responsibility for job creation.

Who are these unemployed? They're not just figures or statistics. They're people we all know. There are four general categories of unemployed people. First there are the job-losers: those workers who have been laid off and expect to be called back to work, and those who are permanently out of a particular job, either because the business they were employed with went out of business, or because their work was reorganized out of existence. They account for 58.7 percent of the unemployed. Second are those who have left their jobs voluntarily, a group accounting for 7.9 percent of those out of work. Third, the new entrants: mostly high school and college graduates who have not previously been in the workforce; they make up 11.1 percent.

Interjection.

MR. STUPICH: The Minister of Industry and Small Business Development wants to talk about federal politics. May I just ask him: at what percentage does the Social Credit Party stand today?

Interjections.

DEPUTY SPEAKER: This is certainly a heated debate, hon. members, but perhaps we can return to order.

[10:45]

MR. STUPICH: Finally there are re-entrants, mostly married women who have left the labour force and wish now to re-enter. Many are looking only for part-time work. This group makes up 22.3 percent of the unemployed.

There are also a large group who are not counted as unemployed in the statistics. Many are holding down part-time jobs, although they usually have, or want to have, full-time jobs.

Interjection.

MR. STUPICH: Mr. Speaker, sometimes I miss the remarks. If he says anything worthwhile, would you draw it to my attention so that I might respond?

MR. LEA: Mr. Speaker, I rise on a point of order. Yesterday, when the Minister of Finance delivered his speech, we on this side of the House sat and listened quietly. Just because the government members do not like what they hear from our spokesman, that is no reason for them to be rude and to try to interrupt the House so that people cannot hear. I wish you would keep your eye on them, Mr. Speaker.

DEPUTY SPEAKER: The hon. member for Prince Rupert makes a very good point, and I would commend what he said to all members of the House, because there appears to be an awful lot of cross-debate and heckling coming from both sides of the House. That's my observation. The member for Nanaimo continues — uninterrupted, please.

[ Page 175 ]

MR. STUPICH: The members should be reminded that it is Friday, Mr. Speaker. I've said that I don't know how long this will be.

Many are holding down part-time jobs. More are discouraged people who have given up hunting for employment, because they see securing a job as an unattainable goal. Clearly it is the job-losers who suffer most from recession depression. And who are they? A striking feature of recessions is how many people hold on to high-paying jobs. Professionals and managers make up 26 percent of the workforce, but receive 40.9 percent of the salaries. These are both public- and private-sector workers. Of these people 73.1 percent are full-time workers, compared with 49.4 percent for other occupations.

In hard-pressed industries the classic case of wages being reduced and workers being asked to give back benefits, and long-term prospects for employment diminishing with new technology, may apply. But this no longer applies to some industries where the available jobs are high-paying and insulated from market conditions. In 1982 the unemployment rate for professionals was 3.3 percent; for administrators, 3.5 percent; for clerical staff, 7 percent; for blue-collar workers, 14.2 percent; for factory workers, 17.7 percent; and for construction workers, 29.3 percent — and the minister has been talking about a particular construction project. What has he done to change that figure?

Unemployment does not affect everyone equally. It can be seen from these statistics — which, admittedly, arise from U.S. studies — who suffers most. Perhaps it can also be seen that the sufferers are not Social Credit supporters. Perhaps that is why they promise everything and do nothing to create jobs.

Let's discuss British Columbia's economic performance compared to the rest of Canada. The economy of British Columbia has slid rapidly in the last 18 months. High unemployment and low productivity have helped to rank this province with the chronic have-nots such as Newfoundland. In December 1982 Ted Brown, Vancouver district economist for Employment Canada, said that we went from a province that was far better off than most to one of the worst in four months under this administration.

The resource sector in British Columbia is shrinking, as both an employer of people and a contributor to gross provincial product. At least 70 percent of the value of goods and services produced in British Columbia now occurs outside the resource sector. There is still, however, an emphasis on the resource basis of the British Columbia economy. Our economic slump is often blamed, especially by this government, on unfavourable world markets. Even if the recession lifts, a lot of jobs may no longer be available. With new technology and automation, industries such as forestry and mining will be able to become more productive without hiring what was once a full staff. Unlike in the past, mining and forestry will not be the fields where future job growth occurs. Between 1961 and 1981, 80 percent of employment growth was in the service sector. In the future jobs will lie in such areas as finance, high technology and secondary manufacturing.

The rate of business failures in Canada is highest in British Columbia. This province also leads the country in having the largest businesses, on average, going broke. This means that when a business in British Columbia goes bankrupt, there is a greater loss of investment capital, a greater loss of jobs and a greater disruption to local economies than elsewhere in Canada.

The rate of new company formation and registration in B.C. has fallen severely in the past 18 months. Do you remember the figures we used to get from the ministry of economic development about the rate at which new companies were being formed? Between 1975 and 1981 there were annual increases of 14.8 percent in incorporation and 19 percent in registration from extraprovincial companies. We used to hear about that regularly. In 1982 these figures fell by 51.5 percent and 9.5 percent respectively, so that incorporations were at a pre-1976 level and extraprovincial registrations at a pre-1979 level.

Receiverships, which grew at an annual rate of 8.3 percent from 1975 to 1981, increased 300 percent in 1982; they are projected to increase again in 1983. In 1982 bankruptcies hit record levels with 1,285 filed, compared to 404 in 1981. The 1983 projections have 14 percent of all the bankruptcies in Canada occurring in the province of British Columbia, up from 8 percent between 1975 and 1981. The first time these figures rose significantly was in 1982. During the 1981-82 fiscal year, with employment rising slightly, the tax load continued to increase to $3,373.56 per capita. But in fiscal year 1982-83, with employment figures dropping, instead of the tax load decreasing or at least remaining constant, it continued to increase by almost $400 per capita to $3,738.80. The minister's budget, delivered yesterday, ensured that this tax load in total and per capita will increase once again.

It is not only in the field of income tax that the public is burdened. There is a series of taxes — accommodation, tobacco and gasoline, liquor, to name a few — where increases have occurred. The Ministry of Finance, in its 1981-82 annual report, showed a provincial tax increase of 25.6 percent. Without any doubt at all this helped British Columbia rapidly move from a low to a high unemployment figure, thereby slowing down economic activity and making unemployment statistics even worse.

What about the outlook for 1983-84? Although 1983-84 looks in some ways better for British Columbia, the picture is not necessarily a rosy one. Mining and forestry may pick up, but automation and technology mean fewer new jobs. The Conference Board in Canada sees the British Columbia real domestic product output decreasing by another 6 percentage points in the months ahead. The Royal Bank of Canada forecasts growth in 1983, but this growth is expected to be slow by historical standards. In the field of business incorporation and registration, minimal recovery is anticipated, but this will not raise the numbers above a pre-1977 level. There is little, if any, significant recovery in the field of employment in the coming year. Factors such as increased taxation and more program cutbacks by the government will do little to improve the economic position of the province. Again, the Conference Board in Canada estimates a further 1.5 percent decrease in employment in British Columbia. British Columbia's economic slide may slow down in 1983, but it will not be in this year that the province's problems are solved.

This, then, is the background against which the minister proposes his budget. It is this background against which his proposals must be measured. So if the fragile recovery the minister spoke about yesterday is a reality, it is a recovery without jobs for the working people of this province. A recovery without jobs is no recovery at all.

[ Page 176 ]

Mr. Speaker, I am sure that the Finance minister and his supporters opposite are convinced that he has produced a clever budget. Inasmuch as the art of speechwriting has as its object to convince the audience of the reasonableness of one's point of view, it is an art. The minister's speech is artful — or clever — for what it does not tell us. It does not tell us that the brand of restraint hitherto practised in the government, and discussed during the election campaign, is nothing like the brand of restraint which commenced with the tabling of yesterday's budget and the 26 bills that accompanied it.

To give the full exercise its due, the pre-budget hype must be noted. In particular, the absolutely absurd suggestion by the Premier, made May 31 at the cabinet's summer camp in a luxury resort at Lake Okanagan, that the province faced a $3 billion deficit, ranks as an unequalled venture into pre-budget hyperbole. Clearly, the spectre of a $3-billion deficit means the Premier believes all of this to be Heal's. One might say, Mr. Speaker, if he "Kinsella" that, then he "Kinsella" anything. However, it must also be noted that the underlying policy shifts in the 1983 budget are as savage, ruthless and draconian as advanced billing indicated. It is not my intention to go so far as to impute motives to hon. members opposite. Had they the opportunity to learn firsthand the plight of the unfortunate in our economy, they might have been a little more fair-minded and even-handed in their approach both to budget matters and their debate.

[11:00]

I have argued that many of the financial problems faced by this government are of its own making. I have also argued that this government's response to economic downturn has worsened economic performance in our province and added immeasurably to human suffering. Now they are faced with a new set of circumstances, and have come up with a new set of policies. Blinded by ideological blinkers and captive to the advice of those who are relatively well off in our economy, they have turned to wrong-headed measures.

Obviously my colleagues and I will have much more to say about the details of the budget in the debate to follow, and in consideration of the estimates, but a few of the major thrusts must be addressed at the outset.

Taxation. The budget makes it clear that revenue shortfalls are to be made up by two principal means: sales tax hikes and user fee hikes. There is no question that both are regressive. The sales tax measure in particular will cost badly needed jobs in our economy. Is it any wonder that the restaurant association in B.C. has told the government to take this particular budget measure — the sales tax hike as it applies to restaurant meals — and stick it?

The sales tax decision has to be put into context as a part of the Socred's already regressive tax regime. In a study entitled "The Redistribution of More in Canada, " Professor W. Irwin Gillespie of Carleton University estimates that the B.C. tax system — for taxes imposed by all levels of government — is second only to Ontario's in regressiveness. But this Socred administration, despite a promise by the Premier never to increase sales taxes.... Remember, Mr. Speaker, the 1979 election campaign, when the sales tax was reduced from 7 percent to 5 percent! The Premier told us that never again in British Columbia would the sales tax be increased. Then it was increased by one point in 1982 and now is being increased again. The Premier promised never to increase sales taxes. Apparently out of concern that Ontario should have succeeded in being even more regressive, he first imported Blue Machine functionaries from that province, then abandoned the government and the treasury to them. Now, at last, our system is fully as backward as Ontario's.

Sales tax. Making a bad tax system even worse is reason enough not to adopt a tax measure, but in this case we have another equally compelling reason. Virtually all of the authoritative commentators have expressed their gravest concern in discussing what has been dubbed "the fragile recovery on the disappointingly low consumer spending trend." Apart from housing, which fortunately is again leading us out of the depression, it is almost universally conceded that consumer spending of large savings will be necessary for a full recovery. But adding 17 percent to the sales tax rate and dramatically increasing its incidence discourages consumer spending, diminishes business revenues and frustrates the recovery. In addition, the administration of this tax on restaurant meals is a nightmare. With the stroke of a pen, the government has turned thousands of B.C. restaurateurs into tax collectors. Administering this tax will turn out to be the government's only significant job-creation proposal.

The budget contains further user fee increases. Why do you suppose the Minister of Health (Hon. Mr. Nielsen) so indignantly denied proposed health user fee increases during the election campaign? I recall his saying the allegations that user fees were going up were a lie. Who, Mr. Speaker....

If I say, "Who is the liar now," it's not parliamentary? Then I won't say that.

But the budget goes further than the health fee increases announced. Despite the hundreds and hundreds of fee and licence hikes in the past two years, there will be more and more. Page 18 of the budget reads: "The question must also be addressed as to the appropriate balance between the costs to be borne by the general taxpayer and by those benefiting directly from the service." Any taxation system which causes the poor to pay the same as the rich for the same purpose is regressive. Any government which would cause this to happen is regressive. Increasing user fees is regressive; it naturally follows that the Social Credit government is regressive.

We can all agree that abuses of government services should be minimized and abusers should be punished. We all agree that such abuse imposes excessive costs on government and, therefore, upon society. But what we in the NDP cannot agree to is that a regressive form of taxation is the answer. We cannot agree that overtaxing the poor is the answer to our economic difficulties. Why not, if one had to, increase instead the income tax surcharge on high income earners? It is something to be considered. But they have avoided that.

But when the government allows a system to remain which takes a greater proportion of the income of the poor than it does of the rich and when a system exists which imposes greater hardship on some than on others, the government proves its indecency. And when the government makes conscious attempts to increase the proportion of income it extracts from the unemployed, raises fees to the sick, imposes more hardship on the low-income families, it abdicates its responsibility to care for those for whom the opening speech read in this Legislature by the Lieutenant-Governor urged us to have some concern.

When you realize that even these increased fees will not recover more than a fraction of the total costs, it makes one wonder about motivation. Is it cost recovery, or is it really a deterrent to make sure that those who can't afford it don't make use of hospital care? We would support any effort by the government to legitimately reduce the overuse of government services, but we will not support any effort to do so by

[ Page 177 ]

increasing the problems which the underprivileged of this province face. Therefore we have and will continue to oppose any attempt by the government to raise user fees.

Mr. Speaker, what about the hit list? I've indicated earlier in my remarks that the record of the Minister of Finance in forecasting budget performance is seriously flawed. The minister has added a new dimension to unsatisfactory budget presentation, and that is an overriding lack of clarity. While the minister and his colleagues are clear that they like restraint and are in favour of more of it, the document itself is woefully lacking in stating exactly how the size and cost of government is to be reduced. In particular I draw members' attention to page 15 of the budget address which contains the hit list of branches and agencies of government which are under attack. It is only upon tabling of the legislation that the true fate of the rentalsman's office, the human rights branch and the Human Rights Commission was learned. Details of the new downsized institutions, how they will work and in whose interests remain to be discovered. However, the hit list chosen by the government is interesting in the extreme for what it says about Social Credit in the 1980s — who it serves, who it represents and the true nature of the changes in this budget, which masquerade under the guise of restraint.

I said I simply do not believe the Premier's assertion that a $3 billion deficit either was or is imminent in the province of British Columbia. Past experience and a quick perusal of the budget tables leads me to believe that the $1.6 billion deficit is similarly suspect. Mr. Speaker, the figures presented to us yesterday for the first two months of this year show a deficit in those two months of $120 million. In past experience, the first part of the year is usually worse than the last part in normal circumstances. At that rate, simply by multiplying by six we would come up with a deficit figure of $700 million rather than the $1.6 billion. On wonders what expenditures are contemplated that have not yet been revealed to us. Or, alternatively, is the government once again presenting a document that has no basis in fact?

I think it could be said that both figures are intended solely for the purpose of creating an atmosphere under which certain institutions of decision-making, adjudication and justice for common working people will be eliminated, knee-capped, starved and slashed.

Mr. Speaker, these are the institutions which bring decision-making and services closer to people, and in that sense it is an attack on our fundamental democratic values. Nowhere is this clearer than in the case of natural resource management. Here we see a fundamental attack on those institutions which gave people in the various regions in this province an ability to influence and shape the decisions of government which bear upon economic development. In passing, I might mention that contrary to popular belief, it was the NDP government which sought to decentralize decision-making in this province.

I remember, for example, the Slocan Valley study, which sought the widest possible public input into regional planning processes. It was an experiment which effectively tapped the considerable talents available in local communities and which could have shaped future provincial economic planning policy.

The budget states that "savings will be realized by initiatives affecting...regional resource management committees operating under the aegis of the Environment and Land Use Committee of cabinet." This government has already eliminated the interdisciplinary secretariat of the Environment and Land Use Committee; now they plan to eliminate all regional input into resource management in this province. The elimination of regional resource management committees seeking to develop broad, decentralized interministerial policies means that the decisive role will pass to that ministry which commands most weight in the cabinet, most likely in Victoria. That ministry will be the Ministry of Lands, Parks and Housing, with its real estate orientation towards land and resource development. Certainly the Minister of Forests will not have strong input into regional planning decisions, for we are told that the policy of decentralization in that ministry, which began in 1980, will be reversed and the power again will be concentrated at the centre. The Ministry of Lands, Parks and Housing will have its regional input reduced, for that ministry is also marked as a candidate for centralization in the budget. The Ministry of Environment has already been effectively subordinated to the Minister of Lands, Parks and Housing (Hon. Mr. Brummet), who, of course, now exercises a joint responsibility.

Following from the budget, we see in legislation that the planning powers of regional districts in unorganized areas will be usurped by the provincial government. What does this mean? We were slowly moving towards an integrated land use planning process in which regional districts worked with central ministries, which were themselves organized on a decentralized regional basis. With the centralization of ministries in Victoria and the effective abolition of the planning powers of regional districts, the people in the regions will have next to no input into the key decision of resource allocation and resource development, which shapes the patterns of the regional economies.

MR. REID: Hear, hear!

MR. STUPICH: The member is saying "hear, hear!" He wants to remove democracy from the people, centralizing it in a cabinet room in Victoria.

When it comes to the difficult trade-offs between agriculture and forestry in Prince George, for example, it is the bureaucrats in Victoria who will determine the outcome, and they will have little knowledge of the local situation. Local people will have simply no input. In the proposed streamlining of the B.C. Utilities Commission, I suspect we see — to give another example — early indication that the people of the north will have no input into projects such as Kemano II. We will have short hearings run as a PR exercise rather than an attempt to gain regional input. This is done in the name of restraint and downsizing of government, but I believe that decentralized decision-making is, in the long-run, far more rational and efficient. It is the people in the regions who are most aware of local circumstances, who have most at stake in the decisions which have to be made, and who should and must be actively engaged in the decisions which shape the future of their communities.

[11:15]

The trend to centralization is equally marked when it comes to the range of social services which are delivered by the provincial government. In the name of restraint, we are told that school boards will be amalgamated by the minister, that hospital boards may be consolidated by the minister, that college boards will be exclusively chosen by cabinet. The minister, rather than local trustees, will prescribe pupil-teacher ratios in our schools.

[ Page 178 ]

MR. REID: A good idea!

MR. STUPICH: Administrative salaries and structures will be decided by the minister. Smaller school boards, reflective of the needs and desires of their communities, will be absorbed into large districts.

MR. REID: Another good idea!

MR. STUPICH: One step more removed from parents and taxpayers — and the member keeps saying: "A good idea! " The more local influence and input, the more people we have that can have some opportunity to put ideas into government, in the mind of the second member for Surrey (Mr. Reid), the better government we have.

I submit that such centralization will, as always, result in greater inefficiencies. A bureaucracy totally removed from local conditions will not make the best decisions. Worst of all, we will lose the sense of involvement, active participation and dedication which local institutions bring to the task of government. I find it rather ironic that the NDP, which is commonly seen as the party of big government.... When we turn to the record, we see that it was this party which sought to decentralize power. We instituted local community resource boards. We decentralized regional planning processes, and so on. It is this government which centralized power and which is abandoning totally the idea that local institutions are best constructed if they're responsible to the community and to the local taxpayers.

I'd like to say a few words about forestry. One thing that marks this budget above all else is its lack of commitment to an industrial development strategy. This government notes in passing that it was British Columbia's truncated economic structure, its overdependence upon the forest and mining industries, which exacerbated the depression, which made us particularly vulnerable to the slump in the United States caused by Reagan's monetarist policies. Yet we see nothing in the budget which would reduce our excessive reliance upon the basic primary industries and, worst of all, we see a callous disregard for that most basic of all industries — namely, forestry. In British Columbia today we have well over one million hectares of forest land which are not satisfactorily restocked. They have been logged but have not been successfully regenerated or planted. We know from the forest and range resource analysis produced by the Ministry of Forests in 1980 that the transition from old growth to new growth forests will mean a decline in our annual harvest of up to 30 percent, and that many regions face an even greater falldown. We know that the forest industry on the coast is in a state of crisis and that its future will be secured only if we begin to take the task of reforestation seriously. On this side of the House we hoped, and thought, that the government had begun to take its role as steward of our forest resource seriously. We had hoped that the government would actually read the expert reports of the Ministry of Forests and realize that a fall in timber harvest of 30 percent means a loss of 30,000 direct jobs and as many as 100,000 indirect jobs. We had hoped that this government would realize that reforestation is both an investment in our economic future and an immediate economic stimulus — a vital government expenditure, a source of new employment. Well, Mr. Speaker, we were wrong in our hopes.

In 1980 the government introduced a five-year forest plan and created the forest and range resource fund with an initial endowment of $130 million. We supported those moves, even though my former colleague, Bill King, argued convincingly that the measures were inadequate and that we had to double the planting targets if we were to make sustained yield forestry a reality in the province of British Columbia for the first time. Last year this government wiped out the balance of the forest and range resource fund to balance cuts in regular ministry spending, which was reduced from $190 million to $144 million. They took the short-sighted, expedient route of cutting back on a vital investment in our economic future, an investment which could have provided temporary employment for thousands of unemployed forest workers. The original targets of the five-year plan were set back by two years as a result of those cuts. For example, the original 1985 planting target of 83,000 hectares was set back to 1987.

The same holds true for other important silvicultural activities: site-clearing, juvenile-spacing and so on. Just to put these cuts into perspective, let us recall that we have to plant 200 million seedlings each year — double today's level — to reforest the backlog lands within the next 15 years. We still clearcuts three acres for every one which we replant. The most recent annual report of the Ministry of Forests shows that we continue to fall further and further behind.

In the 1980-81 annual report of the Ministry of Forests the first following the announcement of the so-called five-year plan — it was said that a significant problem has been the high level of vacancies in permanent positions. Those vacancies were not filled subsequently, and now we find in the estimates that more than 1,000 employees are to be laid off. One hundred Forests ministry employees were laid off in Prince George last week, 36 in Chilliwack the week before. The Forests ministry has been selected as a target for cuts because it happens to have a large number of auxiliary employees. The reason for that is simple. We are just beginning to produce the silvicultural technicians and professional foresters we need to regenerate and replenish our vital forest base. The Minister of Forests (Hon. Mr. Waterland) would have us believe that these employees will be hired and put to work by the private sector. But I note that in 1981-82, the last year for which we have figures, 40 percent of the total Ministry of Forests expenditure was carried out by the private sector. People working in the private sector are hired by the Ministry of Forests to do this work. In other words, a substantial part of the Forests budget, now being cut back, is directed towards employing workers in the private sector. I would also note that the forest industry has been laying off workers to cut costs and has relegated silviculture to a low position in the overall list of priorities. The estimates show that spending on silviculture will be down by 10 percent this year; that is, 10 percent below a level already cut, a level already grossly inadequate to the tasks that confront us.

I submit there is no more important economic activity of government than the regeneration of our forest base. Only through significantly increased expenditures on forestry can we maintain and expand the level of employment in our forest industry. Let us not forget that for all the talk of a post-industrial society, it is the forest industry that directly determines the health of the economy throughout much of this province; that it is the health of local economies which supports much of the secondary industry and service industries in the large urban centres.

I say that it is a total abdication of responsibility on the part of this government to cut back even further on forest

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expenditures. Future generations will look back with disbelief on the utter lack of responsibility of this government.

They talk about reliance on the private sector, yet they should know — they must know — that the forest industry itself is supportive of increased investment in our forest base and recognizes that this task must be shared by the private and public sectors.

I say it is a scandal. I hope the people of this province will remember that this government reneged on its promises of just three years ago. I say to them today that the NDP stands firm by its commitment to double reforestation targets within the shortest possible period of time when we are elected to government. There is no more important economic priority and no greater economic responsibility.

The budget is thrice wrong. It is wrong in instituting regressive taxation, which will drive down vulnerable industries as well as economic performance generally. It is wrong in the selection of a hit-list of agencies which attack institutions and bring decision-making and justice to common people. It is wrong in the abandonment of the critical goal of diversification in the economy through linkages with our base industries. Again, this list is thematic and does not cover the full range of damage inflicted by this budget.

In the weeks ahead the Minister of Human Resources (Hon. Mrs. McCarthy) will undoubtedly be asked to explain in some detail how the growing army of social assistance recipients can be expected to survive in good health on 1980s subsistence poverty levels. The Attorney-General (Hon. Mr. Smith) will have to explain who he is kidding concerning the effects of proposed cuts in corrections, legal aid and criminal injuries payments. Education cutbacks and health-user fees will all be canvassed thoroughly by members on this side of the House.

When I started I said I would talk about what's missing in this budget. The Social Credit government of British Columbia is the last government in Canada to present a budget this year. This delay has consequences for our economy, which I have already discussed. The members may be interested to know that the first budget presented by a Canadian senior level government this year was from the NDP government in Manitoba. Ordinarily you would think that delay would give an advantage; that the time spent would improve the product.

Let me quote briefly the opening words of the Manitoba budget address, delivered February 24, 1983, four and a half months ago: "Unemployment is the number one problem in Canada, and it is the number one problem in Manitoba. Creating jobs and saving jobs are the top priorities of our New Democratic government; and they are the most important objectives in this budget."

[11:30]

Words to this effect are completely missing from the budget presented yesterday, because, despite brave election talk, there are no jobs for British Colombians in this budget. There are job cuts and abandoned job programs. There are tax hikes which will cost jobs, but there are no new jobs.

Instead, the budget gives us a big lie. The big lie is expressed plainly on page 26: "Through the restraint program, longer-term recovery will be secured." Mr. Speaker, the type of restraint proposed in this budget is to recovery what fighting is to the achievement of peace. Aggression no more creates harmony than singling out and penalizing groups promotes recovery. Despite every disavowal there is no question but that that is what this budget does.

Again, from the same page of the budget we are told that productivity gains will lead us out of recovery. "Productivity gains will be achieved through restraint," the comfortable Social Credit slogan has it. One would have to be a fool to believe that the kind of treatment afforded government employees in this budget will lead to productivity gains. How does the prospect of a zero compensation increase provide incentive for individual decisions and effort to improve productivity? How does the 5 percent pay cut promote productivity? Worse yet, how does the threat — without cause — at any time, as a restraint measure, promote productivity gains? How does the dismissal of these employees promote anything resembling improvement in service, delivery and productivity? What if such dismissal occurs, as it did yesterday afternoon on television before the eyes of hundreds of thousands of British Columbians? What has any of this to do with recovery?

The minister and the government know that the budget in this respect appeals to the basest motives of an electorate frightened by economic events. It is scapegoating, pure and simple. Nothing more, nothing less. I think most thoughtful British Columbians will realize that scapegoating has its price. The price will be paid sooner or later, but it will be paid. This rightward drift, which depends, as it must, on savaging certain people and institutions, will stand in the way of grand ideological design, and is a mistake in response to an economic situation. Social Credit has, of course, always been a party of free enterprise. As a party which strongly supports small business cooperatives and responsible business enterprises, the NDP also supports the continued existence of the free enterprise system.

Members on this side have shown considerably more concern about the elimination of competition in the workplace, particularly our major resource industries, than have members of the Social Credit Party. It is also fair to say that the party opposite has traditionally believed in a mixed economy, where the provincial government paid a strong and active role in leading the way for the private sector. There have been many disagreements and debates, but in retrospect, the Social Credit administration of the 1950s and '60s must be given credit for building this province. They did so through a mixture of public and private enterprise. The BCR has contributed to the growth of the forest industry in the interior. Much of our economic growth flows from major investments through B.C. Hydro.

The W.A.C. Bennett vision of the economic future of this province required a strong and active role on the part of the provincial government. This new government has turned its back on these traditions to embrace the fashionable cliches of the Fraser Institute and the radical right from the United States and Great Britain. This budget does not state that recovery requires a strong private sector; it goes a step further. It states that only the private sector can create jobs. This approach is like fighting with one arm tied behind your back. It is a self-imposed handicap, and one that will hurt economic growth. I might add that the turmoil to be created throughout the public sector by the government's incredible labour relations practices and vicious methods of firing will further cripple the limited role of the B.C. government in economic development.

We on this side of the House believe and consistently propose that economic growth depends on the development

[ Page 180 ]

of a coherent, overall economic development strategy, emphasizing the partnership of government and the private sector. Rolling back the role of government, which has existed throughout our province's history, will impede rather than promote recovery. Social Credit is in danger of becoming an ideological party of the extreme right. This danger arises mainly from a wrong-headed approach to an economic problem which it believes is not of its own making. Whatever the cause, the Social Credit administration in B.C. is now in bed with Thatcher and Reagan. Cuts are being made in the safety net built up over the past 30 years. Regulatory and decision-making systems designed to give local communities some say and input into their local economies will be done away with. The responsibility is to be shifted to the private sector alone. These things are happening under the guise of a restraint program, but they have a deeper meaning than that. Mr. Speaker, the number of people employed in this province today is no greater than it was in 1980, three years ago. I think it appropriate that the government reflect on the policies and decisions it has made in the period since 1980. Is it not the floundering, incremental march toward the far right, as embodied in the present budget, which led us to the present difficulty?

Members opposite will protest that they have no choice in pursuing these policies. This is the argument of economic necessity which permeates the budget speech like water in a sponge. This, of course, is the second big lie.

I referred earlier to the 1983 Manitoba budget address. Manitoba has shown clearly in the past two years that it is not necessary to victimize government employees, the unemployed or the sick. Moreover they have shown that they can avoid the reaction policies of this Social Credit government while also promoting economic growth. Manitoba has not been one of the have provinces. In fact there is less to work with in the way of resources in that province than in the province of British Columbia. Yet in 1982 Manitoba outperformed any other province in terms of economic growth, with the single exception of Prince Edward Island. Unemployment increased in Manitoba in 1982, but by less than any other province in Canada. B.C.'s increase in 1982, meanwhile, was the highest in all of Canada. Yet Manitoba has done this without sacrificing democratic institutions, without compromising health care delivery and certainly without significant tax increases affecting low-income and unemployed persons. Moreover, capital investment in Manitoba has not suffered the same drop as it has in the province of British Columbia. I think this record tells us that a government that is prepared to create jobs by investing in needed economic and community infrastructure can alleviate the impact of the depression on its people, as we were urged to do in the opening speech. It shows that even with rather limited room for manoeuvring it i possible for decisive action to make a difference.

It is a question of policy and, ultimately, one of values. I do not believe the sharp turn to the right reflects strong moral values on the part of the government. After all, the members opposite created the debt and the financial situation which they now plead forces them into the unfortunate budget measures proposed yesterday.

We on this side of the House advocate a new industrial strategy which has an important short-term goal of immediate job creation. Unemployment levels approaching 15 percent, as envisioned this year and next, are completely unacceptable. They would not be accepted in Manitoba. In British Columbia we are witnessing the abandonment of capital investment in the forest industry, particularly with MacMillan Bloedel and B.C. Forest Products on Vancouver Island. MacMillan Bloedel has made it known that it will never rehire 2,000 laid-off employees in Port Alberni. The manufacturing industry has laid off numerous employees and has no present intention of rehiring them. The government has decided to join the club and declare thousands of its employees redundant, useless and out the door.

We know that markets for our coal are saturated and fiercely competitive. Southeast producers have agreed to price cuts and, worse yet, volume cutbacks in shipments. The pressure is on for price cuts in the northeast. The Minister of Industry and Small Business Development (Hon. Mr. Phillips) knows that the writing is on the wall. I wonder how many new coal contracts he's signed lately? New mines in copper, lead, zinc and molybdenum will have to wait until presently closed mines have been reopened — if they are reopened.

The bright spots in the economy for the future may be tourism and high technology. But tourism, reeling from poor government promotion efforts and the surtax on hotel rooms last year, will now be hit with restaurant meal taxes and sales tax increases. The high-technology field awaits stronger provincial action. This subject will be debated in the House in this session. Members on this side welcome initiatives towards high-technology developments, but hope we move beyond massive public subsidies and concessions in the field of labour standards. Where does all this lead us?

[11:45]

The kind of recovery envisioned by the budget document is fragile in more ways than one. It is fragile because it shows no signs of producing needed jobs, particularly for unemployed young people. But it is also fragile because it leaves us extremely vulnerable to those forces which made us the hardest hit of all the provinces in the current depression. We are also vulnerable so long as the government brings in ill-timed tax increases and cutbacks with critical economic consequences. We need a coherent, overall economic development strategy which will reduce our vulnerability to happenings in other countries and which will create new jobs in the province of British Columbia. The government simply must develop a new strategy for economic development which goes beyond the slogans and clichés made popular by such propaganda agencies as the Fraser Institute. Leaving free enterprise to do the job alone sounds appealing to some people — no question about that — but free enterprise can only work in our mixed economy when government creates the proper environment.

The present budget falls short of the mark. The promotion of this province in world markets is too big a job, and too important for our future, to be left to the haphazard arrangements and the junketeering of the past. B.C. is well-placed to enjoy a rich trade with the Pacific Rim, as well as with our traditional trading partners in the United States. We cannot survive on the political junketeering of the past. We must get behind joint programs with the private sector such as the Asia Pacific Foundation, proposed recently in a study for the Canadian Secretary of State for External Affairs, to achieve these goals. It is not as easy to work in tandem and to share responsibility with the private sector for our economic future, but this is simply the only policy that can work. There is something in all of this that our citizens need to know; in the end, that is what is missing from the budget. Our citizens, our

[ Page 181 ]

young citizens in particular, need to know that the society in which they believe believes in a full-employment economy. There is a greater fear than most members realize that unemployment is a long-term prospect. Young families with children fear that the hard road of social assistance — extreme poverty and lack of dignity — is all this society has to offer. It is small wonder that people resist technological change when it could mean the hard road at a time when young families usually experience the joy of becoming contributing members of their community. The right-wing clichés and the underlying attack on democratic institutions which bring justice to common people fall completely beside this mark. The budget, and the accompanying legislative program tabled yesterday, will spark the debate about the future of this province.

[Mr. Pelton in the chair.]

We on this side of the House look forward to the debate. We hope the debate will clarify the conditions under which British Columbia can become the province and the society it has the ability to be. But, Mr. Speaker, from the presentation of the budget yesterday, on what we've seen so far of government plans for the people of British Columbia, there can be no doubt that they've failed completely. The thrust of the throne speech debate was to impress upon the government its responsibility to serve the needs of the people of British Columbia. This budget has failed completely, and the opposition cannot vote in favour of it.

MR. REYNOLDS: It's a pleasure to be the first speaker for the government after the Minister of Finance's budget. Before I start, Mr. Speaker, I would like to introduce a couple of people who are in the gallery: Mrs. Sheila Veitch, the chairman of finance of the Burnaby School Board; and the government Whip's brother-in-law, Mr. Grant Boyce, the secretary-treasurer of the Sudbury and District School Board.

Once again I have to say, from listening to the throne speech debate, that the members on the opposite side didn't offer any solutions. And listening to the member for Nanaimo for the last two hours, I really didn't hear any solutions again. But, Mr. Speaker, I'd like to start off by giving a couple of quotations. I'll read one and then later I'll tell you who said it, Mr. Speaker, because you might be surprised. It was in the Vancouver Sun:

"The provincial government will cut back on services if necessary, in order to balance the budget, the Premier said here Wednesday. The Premier has pledged in recent weeks that the government will hold the line on services, but has not yet suggested that cutbacks might be necessary. He said he believed the budget will balance without the necessity for cuts, but said services will be chopped if the need arises. 'We've been spoiled in this country,' he said. 'We've had it too easy, and we've been led to believe that things come too easy.' He suggested that governments have to take the lead and say there will be no deficit spending. 'If governments don't, who will?' he asked.

"The Premier, citing the $1.6 billion deficit in Ontario's budget and a four-month $1 billion federal deficit, said the theory that deficits could be made up at a later date somehow never works out. 'I'm going to have a balanced budget, and if I have to make cuts, I will cut.' The Premier refused to speculate in what areas cuts might come, and said the situation has not yet arisen since he believes that government will be able to balance its books. 'But if the worse comes to the worst, cutbacks will come,' he stressed."

Mr. Speaker, the Premier said that — and the Premier in 1975 was the Hon. Leader of the Opposition who sits in this House right now.

[Mr. Strachan in the chair.]

Mr. Speaker, again I mention hypocrisy. Here's an opposition sitting across from a government — the Premier and the Minister of Finance — who have put out a budget that I will support 110 percent because it's what this province needs. Yesterday I saw the official critic from the opposition — because the television cameras were over there — flashing up his newspaper about the government jobs and increases in that area. I guess I don't knock him for that, because that's politics and they've got to take the best shots they can. But he should remember also that it was, as Premier, he who doubled his own salary when he got into this House as Premier after so many years in opposition, at a time when the senior citizens of this country.... The Premier at that time saw fit to take a $53,000 salary when senior citizens on Mincome were making about $3,180. I suggest to you that that party does not care about the little people as they try to stress that they do.

AN HON. MEMBER: The critic is leaving.

MR. REYNOLDS: Well, the critic is gone because he doesn't like to hear the truth.

They haven't made any proposals. They talk about this government and this government's caring. Well, I suggest to you, Mr. Speaker, that this government in the Health ministry will spend $2.4 billion, up 7.3 percent over last year; the Human Resources ministry's budget of $1.4 billion is up almost 14 percent, and Education at $1.4 billion is up 7 percent. In a time of restraint, this free enterprise government of which I'm proud to be a member, has increased the budget in the areas that people are concerned in.

Mr. Speaker, I think the people of this province appreciate the fact that this government.... They certainly did in the election. We preached restraint. The members on the other side may remember the leader of their party making statements about how he would remove restraint on the civil service in this province. They got sadly defeated, and yet they still seem to want to talk about it. Well, I would suggest to them that they should be back in their constituencies talking to their people, because the people of this province appreciate restraint.

The official critic for the NDP stated in his speech.... You asked me to speak to it; I'll speak to it. I'm going to start quoting some of the things that the critic for your party said during his speech and tell you what I think of them. He said he was upset about our deficits. But what would he do? He really didn't say what he would do. Let me quote what he said during the last election campaign. He said the provincial government....

Interjection.

[ Page 182 ]

MR. REYNOLDS: The second member for Vancouver Centre says I make it up as I go along, Mr. Speaker. Well, I'll give him some quotes, and I defy him to prove that they are untrue. These quotes come from newspapers in this province, most of them left-wing ones that support his party and some of them from the NDP member of the Province, Mr. Garr.

Let me quote the member for Nanaimo, the official critic of the NDP. He says: "'The provincial government should drive its forecast $1.3 billion deficit even higher to create jobs,' the opposition Finance critic said Tuesday. The NDP member for Nanaimo conceded that this would mean more borrowing, and that could lead to worsening inflation and higher interest rates, but said that that was a price that had to be paid if unemployment was to be conquered." Now, Mr. Speaker, this is the same man who in this House just knocked this government about inflation, and yet he was saying it himself. That's in the Times-Colonist, February 16, 1983, on page A3 if he wants to check himself,

During the opposition critic's speech, he talked about the strengths of the Socreds in Ottawa. I guess he was trying to make a little joke. This party in British Columbia is the Social Credit Party, but I would suggest to him that he should look at the strength of the NDP in Ottawa and across this country, because they've gone from the 26 percent high that their party had in this country down to a low, in the latest Gallup poll, of 15 percent. I would suggest to them, Mr. Speaker, that maybe the New Democrats should have had a leadership convention at their last convention and maybe sought a new leader, because certainly the job that they're doing in Ottawa, in playing footsie with the Liberals in that NDP-Liberal coalition, is going to defeat their party. They'll be lucky to go back to Ottawa with very few seats after the next federal election.

MR. LAUK: Are you going to speak in this debate at all, John?

MR. REYNOLDS: The hon. member wants to know if I'm going to speak in this debate. I am speaking in the debate; he just doesn't like what he's hearing.

Let me talk about the 7 percent tax on meals over $7 that the NDP critic talked about. He said that we're going to turn thousands of restaurateurs into tax collectors. The fact of the matter is — if the member knew anything about business or restaurants — that people in the business are already tax collectors. They're collecting tax on liquor, and it's not going to be a major problem, no matter what you read in the paper from the association member. I read it in the paper this morning. I happen to be in that business. If my waiters or waitresses in the restaurant didn't have enough brains to calculate a 7 percent tax on a $7 meal, they wouldn't be working for me.

I would suggest that the people in the restaurant business, if they read my notice of motion in Hansard of this Legislature, which a lot of them have, with regard to the transfer of liquor licensing power and regulatory policies with respect to restaurants, hotels, motels and neighbourhood pubs, they would appreciate it if this government were to go in that direction and not be concerned about this 7 percent tax. The people in the restaurant business are free-enterprisers. They appreciate what this government's doing, and they're going to help us along.

The official spokesman for the opposition talked about Reaganism. Also the member for Burnaby North (Mrs. Dailly) in her throne speech knocked the Thatcher and Reagan governments. Well, Mr. Speaker, I don't know why they want to get on this attack. The Reagan government in the United States and the Thatcher government in London.... Mrs. Thatcher just got elected with one of the largest majorities in a country that has had a strong socialist government. Certainly they should get the message that they shouldn't be knocking these types of government. They're the types of government that the people of this day want, and they're the types of government that are going to eliminate the New Democrats and the socialists from the political scene in this province.

The official critic for the NDP also talked about the lack of commitment to an industrial policy. I would suggest to him that he really hasn't read the budget in its entirety, because the people in this province in the industrial areas — and I've talked to a lot of them since this budget was delivered yesterday — are thrilled with this budget. They think it's time that the government of this province took some strong action. They're happy they voted us in in the last election, and they're looking forward to the implementation of these 26 pieces of legislation that were introduced in this House yesterday. They're looking forward to the exemption on machinery and equipment for over 15,000 businesses in this province and the reduction of property tax for small business. They're really looking forward to the cutting down of the size of the government in this province, a job which was started last year by this government and will continue on. They're also very happy that this government is eliminating tenure in the civil service. It's about time that the civil servants had to act in their jobs the same as people in the private enterprise sector across this country. I would suggest to you, Mr. Speaker, that the NDP in this province will see that other free enterprise governments in future years — not only across Canada but through the United States and around the world — will follow the example of this Premier and his government in British Columbia in dealing with the civil service the way they did in this budget yesterday.

[12:00]

Interjection.

MR. REYNOLDS: The hon. member in front of me says, "Bennett for Prime Minister," and I see nothing wrong with that at all. If the Premier of this province had been the Prime Minister of Canada over the last ten years, we wouldn't have the problems we've got in this country right now.

I'd also suggest that there are going to be a couple of federal by-elections very shortly that will elect two Conservatives. In his speech the member asked how we could expect a productive civil service when we cut their salaries, reduce them by 5 percent? The hon. member for Coquitlam-Moody (Mr. Rose) just took a pay cut in changing jobs from the federal House to this House. I suggest that in his constituency, which is now up for a by-election, he'll be replaced by a Conservative member of Parliament, as well as Brian Mulroney winning his seat in the eastern part of this country. In the next general election, we'll have a massive change to a Conservative government in Ottawa, which I'm sure we'll all appreciate in this country.

The official spokesman for the NDP talked about the diminishing resource sector in British Columbia. Now that this election is over, the resource sector in this province will flourish. One reason that major mining companies and small

[ Page 183 ]

companies looking for mining properties were investing in areas other than British Columbia was because they were still concerned over the last four years that this province could go back to socialism. The people in the resource industry are no longer afraid that this province is going to go back to socialism, and you will see more work in the resource field, the mining industry and the oil search business in British Columbia than you've ever seen before.

Another reason the people in this industry were so concerned is some of the resolutions this party passed at past conventions. I would like to repeat some of them because I think they bear repeating.

November 27, 1982, the NDP convention: "Be it resolved that a Crown-owned minerals marketing corporation be created to facilitate the orderly marketing and stock-piling of our B.C. minerals." We've got enough problems with marketing boards in this country without putting them into our mineral area.

From the last NDP convention, another resolution: "The introduction of a provincial surcharge on the income from capital gains." That's certainly no way to encourage people to invest in this province, especially in the mining industries. "A supercharge on income from capital gains from speculatively held real property." Those are the areas that scare investment away from this province, and those are the areas in which, because we were re-elected, people will start to reinvest in this province. That's why I'm so happy to support this budget.

Interjections.

MR. REYNOLDS: I hear the hon. member for Vancouver East shouting about Mr. Spetifore's property. He's wrong; it's no longer Mr. Spetifore's property. If the member was paying attention he'd know that it belongs to Dawn Development. That member must be very upset now that this government has seen fit to take away the regional planning authority of the GVRD. I'm thrilled about that policy statement announced yesterday by this government.

The official spokesman for the NDP talked about the delay in the budget — the fact that we were the last province in Canada. He talked about the damage to British Columbia. The leader of that party was quoted during the election as saying the NDP would not be able to bring in a full budget until next February if they were elected in this province. I think that goes to show how things can change. Just standing here listening to this member.... I look forward, as he does, to the debate, and I hope that during this debate we can hear some NDP policies as to what they would do in this province to create employment.

One of the members down there says he's going to talk about that. I'll look forward to it.

AN HON. MEMBER: I'm right after you.

MR. REYNOLDS: Well, that's good. I'll make sure I stay in the House for your full speech. I'll listen to it with great interest.

In the last few years this government has created jobs in some major areas. One of the areas is British Columbia Place, and I'm very proud to be a member of the government that created British Columbia Place. It created in excess of 2,500 jobs, and also brought the project in early and under budget. That shows good management, and that's one of the reasons we were re-elected in this province.

I know the hon. members of the NDP don't like to hear some of the quotes, but when the Premier turned the sod of B.C. Place he said the B.C. Lions would defend the Grey Cup here in 1983. Looking at them play so far, maybe he's a bit of a prophet; it looks like they are going to have a tremendous year. The Leader of the Opposition, who has a former British Columbia Lion on his team, the first member for Vancouver Centre (Mr. Barnes), said all the children can be taken through the stadium with $125 million, another place for the Vancouver Lions to lose. It's that kind of negative reasoning that cost the Leader of the Opposition votes in this province.

The member for Burnaby-Edmonds (Ms. Brown) was quoted as saying Vancouver's new stadium could be built because needy groups such as the mentally retarded and the physically handicapped were deprived of the money they were entitled to receive. I say that's nonsense, and the people of British Columbia showed that member and her party that it was nonsense during the election. This party has increased its budgets in the people areas, in the areas that people care about, since it has been in power.

The hon. member for Comox (Ms. Sanford) was quoted as saying about B.C. Place: "It is, however, part of a consistent pattern of using and abusing government funds for promoting the political career of individual Socred ministers and their political party in general." Mr. Speaker, it is that type of comment that the people of this province looked at during the last election, and that's why they didn't give this party a chance to govern the province, because they realized how irresponsible they were being in making those comments.

Heavens above, Mr. Speaker, I've got one here from the second member for Vancouver Centre (Mr. Lauk). He said:

"They need that almost $1 billion to juice up their finances so they can build B.C. Place, so that they can build the northeastern coal project at the direct expense of the school system of this province. If the B.C. Place project is completed there should be a plaque put up in a prominent place so people going into the stadium can see it: 'This edifice — this monument — was built because of the sacrifices and the suffering of kids in the schools, of single parents, of the health system, of rural landowners.' Underneath it there should be one phrase, 'Bennett for pharaoh, ' because it reminds me of the time when the great mass of people in a state were expended to build monuments for its monarch."

Mr. Speaker, that is being less than honest with the people of this province, because this government.... As I mentioned, the education budget is up 7 percent this year. The number of students in this province in 1971 equalled 506,561. Last year there were 485,568 students — 20,993 less students in this province since 1971. But how many teachers are there in this province? In 1971, there were 22,193; in 1982, 29,075. Mr. Speaker, that's 6,882 more teachers for 20,993 less students. For every three students who left, one teacher was hired.

Interjection.

MR. REYNOLDS: The second member for Vancouver Centre (Mr. Lauk) says I'm anti-education. Let me tell you something, I've got five children in the school system — two

[ Page 184 ]

of them have graduated, two of them are sitting in this gallery — and they are getting the best education in this province that they can get anywhere in the world. I would suggest to that member that I have as much concern for my children as any socialist in this province does. In fact one of the reasons I got involved with politics again is that I was tired of the nonsense I was hearing from the socialist side when I knew that free enterprise gives you a better government, a better system, and a better place to raise your children than the nonsense you're talking about.

Mr. Speaker, the member for Burnaby North (Mrs. Dailly), speaking about B.C. Place, said that it would hurt housing — that it doesn't help housing. Well, it's interesting to note: CBC-TV, on May housing starts.... They're up 172 percent over May 1982, and when you see housing starts increase like that you know that the economy is getting better. I'll just give you the figures: construction started on more than 22,500 new homes in May — that's a whopping 172 percent increase over May 1982, when just over 8,000 homes and apartments were built.

Mr. Speaker, the economy is coming back, and it's budgets like this that are going to help lead us out of this recession that we've been in. Once again, I don't know how many times I'm going to say it, but I'm so pleased at the budget that the Minister of Finance brought in that it bears repeating many, many times.

Mr. Speaker, in the throne speech debate the member for Prince Rupert (Mr. Lea) didn't like the government spending on Whistler. I would just like to tell him in the budget debate that we've allocated money, as he knows, for highways. Highway 99, which leads up to Whistler, is going to get some of that money. It's the finest ski resort in North America. It's a fantastic place. But one of the things the NDP doesn't understand when they talk about the government bailing out Whistler is that Whistler has put over $20 million in taxes back into this province since it started. I think that's a great benefit to this province, and it's going to put a lot more money into the tax coffers of this province. The government made the right decision when it set up the Whistler land commission, and in the long term — certainly well before the next election — the experts that it has placed in charge will prove to the members from the NDP that that decision was the right decision.

It is interesting how they don't like the spending on Whistler, but they love spending it on Cypress Bowl. I was very pleased to see the minister announce yesterday that we were going to look at putting Cypress Bowl in the private sector. I can only encourage the government to do it as quickly as they can, because certainly there is not a thing in this country the private sector can't run better than government, and the sooner we get the government out of more business the better off we are going to be,

MR. LAUK: What about the stadium?

MR. REYNOLDS: The stadium and B.C. Place are a monument to this province. I just find it astounding that the member still wants to talk about it when so many of his supporters must be going there and enjoying the baseball games and everything else.

AN HON. MEMBER: Not yet.

MR. REYNOLDS: Well, we'll be enjoying the baseball. You have to remember that the Vancouver C's are going to be playing one of their first games there.

AN HON. MEMBER: Does Mike like it?

MR. REYNOLDS: Mr. Speaker, the member should know that even the mayor of the city of Vancouver, one of his party supporters, and possibly one of the candidates for its leadership — and I'd love to see him sitting in this Legislature — was not only one of those who knocked B.C. Place, he knocked Expo 86 and even sent telegrams trying to stop it. Now, of course, he's onside: the stadium looks great; he wants to stand next to us and get his picture in the paper and say how great the whole story is. I would just suggest, Mr. Speaker, that the mayor of the city of Vancouver should possibly seek the leadership of the NDP, because he certainly won't be the mayor of Vancouver after the next election.

During the election, we talked about transit.

Interjections.

DEPUTY SPEAKER: Hon. members, please. The member for West Vancouver–Howe Sound has the floor and will be allowed to continue uninterrupted.

MR. REYNOLDS: I'm sorry I upset the second member for Vancouver Centre (Mr. Lauk) so much, but he'll have his chance to stand in the debate, and I'll have my chance to sit here and take some jabs at him.

[12:15]

I'd like to congratulate the second member for Surrey (Mr. Reid), sitting at my left, for the fine job that he's done as the chairman of Metro Transit. It certainly is nice to have somebody responsible in charge. As you know, during the election campaign the NDP didn't like the ALRT — said it was a disaster. I'd just suggest to you, Mr. Speaker, that the decision made by this government to buy a system that is made in Canada is one that wouldn't have been made by the NDP if they had been in power. They were looking in areas other than Canada to put in a system. This government here went to Ontario, is trying a new technology, and should be given credit for the fact that we bought Canadian and didn't necessarily be so parochial as to say it had to be from British Columbia. We bought a technology from Canada. We bought it because it's the best system in the world, and....

MR. LAUK: Why not build it here?

MR. REYNOLDS: Mr. Speaker, the second member for Vancouver Centre says: "Why not build it in B.C.?" Well, that's the problem with the NDP.

HON. MR. PHILLIPS: Second member.

MR. REYNOLDS: Well, of course. He came in second this time — his popularity is slipping. He says: "Why not build it in B.C.?" They tried to build some rail-cars in British Columbia and nobody would buy them. If they were still manufacturing those rail cars they'd be lined up from here to Prince George and back and nobody around to buy them. But this government is a responsible government. We consider ourselves Canadians first, and if some other part of Canada has technology that's better than ours, we're not afraid to say

[ Page 185 ]

so, and put up our money to build a system made in Ontario. We know it's a good system.

Let me just quote Mr. Jim Lorimer, who was the NDP Minister of Municipal Affairs at one time, if they want to talk about responsibility. He stated, incredibly, that he was proud that his government had lost $17 million in public transit. "Next year we're going to lose more, and I'm not here to apologize, I'm here to brag." Now, Mr. Speaker, what kind of a responsible minister would brag that they were losing money? You'd think he would at least say that it's a public service that does lose some money, but we're going to try and make it make money, or look for a system that will make money.

I would suggest that the NDP should take a second look at the ALRT, because the one-mile section that this government has opened up for the summer for people to ride on.... I give credit also to the member for North Vancouver–Seymour (Mr. Davis) who has done such a fantastic job of putting that program together in the ALRT Over 40,000 people — and that number could be higher by now; I got that figure last Monday, I think — have ridden on that system free just to see what it looks like. Now that doesn't seem to me, Mr. Speaker, like a system that people don't like. I would imagine that they just can't wait till that system gets open all the way to New Westminster, then on to Surrey, and then up to Richmond, and then over to the North Shore on the Lions Gate Bridge.

It's his party, Mr. Speaker, that has delayed us in this province. It's his party that fought the tunnel going over to the North Shore years ago that would have solved some major problems and would have only cost $50 million at the time, of which $25 million was put up by the federal government.

MR. LAUK: You wanted to pave Stanley Park.

MR. REYNOLDS: The second member for Vancouver Centre says I wanted to pave Stanley Park — another hypocritical statement from the NDP. Only they care about people; only they care about parks; only they care about senior citizens. Well, Mr. Speaker, if it wasn't for free enterprise in this country, the senior citizens, the children, and all those things he talks about, wouldn't be where they are in this province. Mr. Speaker, it was only one year ago today, on July 8, 1982, that the second member for Vancouver Centre — he used to be the first member — withdrew his claims about a major bank collapse in this country. You talk about senior citizens. You talk about responsibility, and senior citizens and children. How many senior citizens in this province ran to their banks that morning after this irresponsible statement? There were hundreds of them all across this country. I give the member credit for withdrawing his statement, but it was an irresponsible one to make.

[Mr. Speaker in the chair.]

The member for Burnaby North (Mrs. Dailly) said in the throne speech debate that she was short of time to comment on what the NDP has done in Manitoba, and the spokesman for the NDP in this debate said that he thought Manitoba was just doing a great job. Well, let me just tell you that after 16 months of handouts and showing deficits the NDP there has imposed a job tax — a tax of 1 1/2 percent on the gross payroll of each and every employer in the province. That job tax is costing jobs in that province.

The second member for Vancouver Centre talks about Manitoba and everything else. Let me just quote the leader of his party. He described Manitoba as an oasis in the middle of an economic desert, and he had special praise for the 1983-84 budget recently introduced by the Pawley government. "It's a shining beacon of responsibility, both social and economic, that every other province should be following," he said. "The NDP budget concentrates on job creation, and despite a burgeoning provincial deficit" — expected to hit $579 million in a province that is a lot smaller than this province — "Pawley and his government will increase spending by almost 16 percent." Mr. Speaker, I suggest to you that that's an irresponsible government.

The NDP, long a philosophical opponent of sales tax, has raised it for the first time in Manitoba since it was levied by the Roblin administration in 1967. It's gone from 5 to 6 percent — at the time tied with British Columbia. The NDP can complain about this province raising its sales tax by 1 percent, but they don't complain about a socialist province. In this province we've got a lot of expenses they don't have in the province of Manitoba. We've got a responsible government, and that's why the sales tax has to go up on a temporary basis to 7 percent.

Interjections.

MR. REYNOLDS: The second member for Vancouver Centre, for his forty-seventh time of interrupting, has asked if I have anything positive to say. Mr. Speaker, I've said it many times, but I will repeat it again: the budget brought in yesterday by the Minister of Finance is a masterpiece and is good for this province.

MR. LAUK: It's a declaration of bankruptcy.

MR. REYNOLDS: The second member for Vancouver Centre says it's a declaration of bankruptcy — another forecast from the banking genius to my right.

Mr. Speaker, it's the NDP who, when they formed the government, wanted to close down our offices in Los Angeles and San Francisco for promoting business and tourism in this province. I would like to tell you that those offices are never closed; they're open still. Let me just tell you the cost of those offices and the revenue that's received in this province from them. The cost of our Seattle office to promote British Columbia is $115,183 a year. The revenue from Washington state is $100 million. I think that's a very good investment — that this government has seen fit to have an office. The cost of the San Francisco office is $127,402 and the cost of the Los Angeles office is $119,263 for a total cost of $246,665. The revenue from California state to this province is $120 million. Money well spent!

The cost of our London office is $150,000, and we receive revenue from the United Kingdom of $40 million. I think that's an excellent return and I give this government credit for keeping those offices open.

This party, the NDP, full of predictions of doom and gloom for 1983, they quite often quote the Conference Board in Canada. Let me quote the Conference Board in Canada when it comes to the real domestic product increase. These are the Conference Board in Canada May 1983 predictions: Newfoundland, 1.9 percent; Prince Edward Island, 0.9 percent; Nova Scotia, 2.8 percent; New Brunswick, 2.4 percent; Quebec — led by a socialist government — 1.8 percent;

[ Page 186 ]

Ontario, 2.3 percent; Manitoba — the second member for Vancouver Centre, who has now left, was just quoting about their unemployment benefits in Manitoba — 1.5 percent; Saskatchewan, 1.5 percent; Alberta, 0.00 percent; British Columbia, 2.9 percent — the highest in Canada. The reason for that is the leadership of the Premier of this province and the Social Credit Party, and the type of budget and bills that were presented in this Legislature yesterday.

Let me just give another quote to the New Democratic Party, who talk about the unions and what we've done to them in this province. In Quebec, in order to increase their chances of winning the May 1980 referendum, the government gave its 300,000 public employees some of the most generous salaries, working conditions and fringe benefits of any North America public servants. Unfortunately René Lévesque feels that whatever the government gives it can also take away. The acute economic, fiscal and budgeting crisis facing Quebec prompted the government last year to ask its so-called partners in the public service and the unions to forgo scheduled wage increases July 1 — increases expected to cost about $500 million. The unions refused. So last summer the government passed a law last summer rolling back wages at the end of the public service union contracts, most of which expired earlier this month, to recoup that money in the first three months of this year. The unions felt it was a negotiating ploy.

When negotiations started last fall with the common front of unions, they discovered the government meant business. When the negotiations got nowhere, the government passed another bill to create new contracts for the next three years. Mr. Speaker, that's a socialist government. The unions and the workers were stunned by the action of this socialist government. Instead of walking out in protest the union leaders and members put out feelers for a compromise, even offering to accept a wage freeze or to negotiate a face-saving deal whereby the money saved from the rollbacks would be used in a job-creation fund. No deal from the socialist government of Quebec. Now the people who were in a great way responsible for the PQ's rise to power are giving angry speeches and pulling out rhetorical hyperbole that hasn't been heard of in years, comparing Lévesque's government to those in Poland and Chile.

Mr. Speaker, it's great for these socialists, the NDP, to knock what this government is doing in a responsible manner. I suggest that if they were sitting in the chair of government, they would have to take responsible attitudes too, Mr. Speaker. They wouldn't have to take it just on the 55 percent of the people who don't belong to unions in this province, they would have to take it on the whole province; including that 45 percent who belong to unions.

I've run out of time to talk about ICBC, but I'm going to talk about ICBC in some other debate; I'm sure it will come up, and I think it's another government area that we should be looking at. This government brought in and foisted so many managers and so forth that couldn't run the insurance business properly that this government had to fork over $181 million to keep it straight and narrow. I want to talk about that in another speech.

I want to congratulate the government for eliminating the rentalsman's office. I would also suggest.... It's not only the government's responsibility, but this whole House should look at the ombudsman's office in this province. That's an office that has got too many employees, is doing work that it wasn't created for, and I think is acting in an irresponsible manner. If I'm a member of that committee that has to unanimously approve the ombudsman for his next term of office, I make no bones about telling you I will vote against him so that we don't have an ombudsman in this province. The MLAs are elected to serve the people, and we can do it for the people of this province. We don't need senior bureaucrats who stuff their offices full of lawyers and secretaries to handle the people's problems.

In closing, I would like to say that I know everyone has some problems in a budget. It sometimes affects us. We heard one of the leaders of the restaurant association complaining this morning. But the government has to take strong, strong measures, and I know the people of my constituency — the overwhelming majority of them — will support me in my support of this government and what they've done. And they will also recognize what the NDP don't: that the Health ministry will be spending $2.4 billion in British Columbia, up 7.3 percent; that the Human Resources ministry budget is $1.4 billion, up almost 14 percent; and that Education is at $1.4 billion, up 7 percent. They will understand that this is a free enterprise government that cares for people and people's services, and they will cheer us on in the way that this government is managing the province.

MR. LEA: Mr. Speaker, can you understand my disappointment in finding out that the people of West Vancouver may not vote NDP next time, and that they approve of this budget? My God, will wonders never cease? The people that that member represents favour this budget. Now doesn't that surprise the rest of us?

[12:30]

At the beginning of my remarks on the throne speech, I mentioned that there are many areas that we agree on in the principles of running a democratic government. In talking about the budget I think we have to admit that there's one area again that we all agree on. We all agree that we'd like to stimulate the economy in such a way as to bring about economic recovery. But there's a basic difference. They are supply-siders; we are demand. That's the difference.

Now, Mr. Speaker, this is a good budget for those who are philosophically in tune with supply economics. Basically it's very simple. What you do is allow corporations and the business community more profit; they will invest that profit into an expanding economy, and that expanding economy will supply more jobs three or four years down the road. Now we are on the demand side of the equation. We say yes, stimulate the economy, but why not do it through consumer spending? Consumers would spend money in the small businesses in this province who would order from suppliers and wholesalers who would order from manufacturers, all of which would stimulate the economy in a different way and immediately, as opposed to having to wait three or four years for the jobs to come along.

Mr. Speaker, I have a number of remarks to make, and I wonder if the House Leader would accept an adjournment until....

Mr. Lea moved adjournment of the debate.

Motion approved.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 12:32 p.m.