[ Page 3391 ]

CONTENTS

Routine Proceedings

Oral Questions

Ombudsman's report on log-scaling. Mr. Macdonald –– 3391

Mr. Barrett

Mr. Skelly

Income assistance cheque surcharge. Hon. Mrs. McCarthy replies –– 3392

Budget debate

Mrs. Dailly –– 3394

Hon. Mr. Hewitt –– 3396

Mr. Nicolson –– 3399

Mr. Kempf –– 3403

Mr. Rose –– 3405

Mr. Reynolds –– 3409

Presenting Reports

Addendum to ombudsman's Special Report No. 7. Mr. Speaker –– 3414

Ministerial statement

Ombudsman's Special Report No. 7. Hon. Mr. Waterland –– 3415

WEDNESDAY, FEBRUARY 22, 1984

The House met at 2:06 p.m.

Prayers.

MR. MOWAT: Mr. Speaker, I would ask the members to welcome to the House today Mr. Graeme Roberts, who is the president of the B.C. Motor Dealers' Association of B.C., a director of Air B.C. and president of Nanaimo Motor Cars.

HON. MR. RICHMOND: Mr. Speaker, in your gallery today are two ladies visiting us from Cold Lake, Alberta. They are Mrs. Claire Norton, my son's mother-in-law, and her daughter Michelle. I would ask the House to make them welcome.

MR. MICHAEL: Mr. Speaker, I would like the House to make welcome two guests from my constituency today, Mr. and Mrs. Don McLeod.

MR. ROSE: Mr. Speaker, I am told that Miss Erin Berger, daughter of Mr. Justice Thomas Berger, a former member of this chamber, is in the House today. She is now working for the NDP caucus in Ottawa, and I would appreciate it if the members would welcome Erin.

Oral Questions

OMBUDSMAN'S REPORT ON LOG-SCALING

MR. MACDONALD: Mr. Speaker, to the Attorney-General. If the matter of possible criminal charges was so important, why did he delay until Tuesday — yesterday — to make his statement that there shouldn't be comment on this matter because of the possibility that someone somewhere might someday be charged? I know the minister was away on Friday, but nobody made it then or on Monday. Was it really all that serious?

HON. MR. SMITH: The allegation of criminal charges is always serious, Mr. Speaker, but the reason it was February 15 that the warning was given was that it was only on February 13 that my staff learned that the ombudsman intended to publish his report. Having learned that on February 13 in a conversation the cabinet secretary had with the ombudsman's officials, it was then that the letter by the Deputy Attorney-General was written to him. Until that was published, the fact that the criminal investigation was already undertaken is not something that we would announce. You do not announce criminal investigations, as you know; you allow the police to do their work. But it became necessary to make that announcement and give that warning when the publication of the report was imminent. I think that's standard practice.

MR. MACDONALD: Mr. Speaker, I thank the Attorney-General for completely dodging my question, which was why he didn't make his statement on Monday. It wasn't an answer to that question at all.

I have another question.

Interjections.

MR. MACDONALD: How they flare up on the way out.

The Attorney-General says that on February 15 he warned the ombudsman: "Don't go ahead with this important report." He sent a copy to the minister, and then he uses words in his statement like "not appropriate for the government to respond to the report," and "the impropriety of responding to the Shoal Island allegations." The minister gave an interview which was reported on Monday, February 21, challenging the scale findings and allegations in that report. Have you scolded or rebuked the Minister of Forests (Hon. Mr. Waterland)?

MR. BARRETT: For doing what you told the ombudsman he shouldn't do.

MR. MACDONALD: Yes.

HON. MR. SMITH: No, Mr. Speaker.

MR. MACDONALD: Mr. Speaker, to the Attorney-General. Don't you find that he broke the injunctions, in your statement, that you said were so serious? Don't you know that?

[2:15]

HON. MR. SMITH: I am not aware of the interview, Mr. Speaker, but I think the publication of this report was a very different situation. The publication of this report catapulted into the arena of public debate the conduct of people who are being investigated in a criminal matter. It was the purpose of the Deputy Attorney-General to not have those matters discussed in public at a time when the criminal investigation was underway. I would have thought that the member for Vancouver East, who keeps taking this line of attack, would have done precisely the same thing had he been Attorney-General. He would have tried to stop public discussion of conduct that was under criminal investigation.

MR. MACDONALD: Supplementary to the Attorney-General. I'll send him this if he is in ignorance of what his colleague is doing. Scale claims questioned. Wouldn't that, in your reasoning, prejudice a possible Crown case against somebody questioning in detail whether these scale figures and the discrepancies are correct? Do you not care whether the Crown's case is prejudiced? Are you being that partial? Mr. Attorney-General, don't you care that the minister is supposedly impairing the Crown's case, if there is to be a case?

I have one other question to the Attorney-General. The statements of the Attorney-General are that the ombudsman had no business going on the media. Obviously the Minister of Forests, your colleague, gave an interview to the media questioning in detail the scale allegations in the ombudsman's report. Will you take him to the woodshed and say: "I’m going to be as firm with you as I am going to be in blocking the ombudsman for making a report that ought to be public."

HON. MR. SMITH: It has to be apparent that the publication of that report and the discussion of it that ensued produced reactions on both sides. My criticism of the ombudsman was very limited and specific: that is, that he ought not to have published that report and catapulted this matter into public debate during a criminal investigation. By publishing that report and by commenting on it himself he

[ Page 3392 ]

certainly generated public debate. He has generated public debate in this arena as well, and members of this House have questioned and raised the subject. All that arose from that initial publication.

MR. MACDONALD: A final question to the Attorney-General. What you're saying is that you don't mind the minister's comments, but you were determined to block publication of that report at all costs.

HON. MR. SMITH: It's a preposterous suggestion, and so characteristic of that member to see either blockings or cover-ups in every action of law enforcement. He knows very well, from reading the documents that I filed yesterday, that the decision to investigate the allegation was a decision made by a responsible official in response to a letter received from Mr. Mahood. That was a law enforcement decision, not a political decision, and he knows that.

MR. BARRETT: Mr. Speaker, in light of his answers today, can the minister explain the interpretation we are expected to put on his statement yesterday? I'll quote from the Blues. In reference to the letter sent on the 15th to the ombudsman, the minister said: "Those ministers of the Crown holding responsibility in matters relating to the investigation have been advised by me through concurrent mail that they should, for the indicated reason, govern themselves within the spirit of the content of this paragraph." Can the minister explain why, in light of the fact that he is critical of the ombudsman for speaking, he told this House yesterday that he advised the ministers not to speak in that 15th letter, and the minister still has spoken...? Why has the Attorney-General not taken any action on a violation of his own admonition?

HON. MR. SMITH: In response to this ingenious line of questioning, Mr. Speaker, surely the whole point is that everyone was warned, prior to publication of the ombudsman's report, not to discuss the matter. Once the ombudsman had published his report, everybody was talking about it. You've been talking about it, and other members have been talking about it. We were trying to have the matter....

Interjections.

MR. SKELLY: On August 23, 1982, the Minister of Forests (Hon. Mr. Waterland) wrote to one of the complainants and said that as a result of a review by his ministry there was no evidence to support the filing of charges. I am wondering if the Attorney-General would explain why the government found it convenient to open this investigation now, when the only apparent purpose is to block publication of the ombudsman's report.

HON. MR. SMITH: Apparently Mr. Mahood, who made the allegations in writing and was at one time of the opinion that there was no criminal activity, was on January 11 of the opinion that there was, and is now of the opinion that there isn't.

MR. SKELLY: That's the government's opinion.

HON. MR. SMITH: Hon. member, what you and the first member for Vancouver East (Mr. Barrett) are doing is impugning the integrity of the Deputy Minister of Finance and the assistant deputy minister of criminal justice. It was the decision of the assistant deputy minister of criminal justice to turn this over to the RCMP, and he made the right decision. He didn't go and ask a politician whether he should make that decision. He made that decision, and you know that. You are trying to rake muck down to the level of officials now.

MR. BARRETT: Mr. Speaker, is the minister aware of a letter sent by the minister, Mr. Waterland, to Mr. Mahood on August 22, 1982, in which it was suggested that a criminal investigation should take place at the instigation of Mr. Mahood, not the government?

HON. MR. SMITH: I am not specifically aware of the letter, but I am aware of the fact that Mr. Mahood approached Mr. Waterland on such matters. It is my understanding that Mr. Waterland advised Mr. Mahood that if he had evidence of criminal activity, he should take that evidence to the RCMP.

MR. BARRETT: Mr. Speaker, I will file this letter for the information of the minister. But I think the appropriate paragraph should be read. I want the minister to answer the question I will frame after I read this paragraph.

"The ministry is certainly not aware of any continuing problems, and your allegations that the Forest Act is not being complied with and that the operator may be manipulating scaling results add a whole new dimension to this matter. While the ministry's early review did confirm the need for change, there was no evidence to support the filing of charges. I am sure that you are aware that it is your responsibility to report to either the RCMP or the Crown prosecutor any evidence you may have on the commission of an offence."

Today you have suggested that it was the Deputy Attorney-General who made the decision. Did Mr. Mahood come to the Deputy Attorney-General on the advice of Mr. Waterland and say on Mr. Waterland's letter: "I am now asking for a criminal investigation"?

HON. MR. SMITH: To my knowledge, no, he did not, but whether he approached a regional Crown counsel or a prosecutor I could not tell you. The difference was, of course, hon. member, that on January 11 Mr. Mahood wrote to the Deputy Minister of Finance making specific allegations, and it was those allegations that were turned over to my official, who then turned them over to the police.

INCOME ASSISTANCE CHEQUE SURCHARGE

HON. MRS. McCARTHY: Mr. Speaker, I took as notice two questions. I'd like to respond to one from the member from Vancouver Centre which was asked yesterday. It was regarding clients of the Ministry of Human Resources vis-à-vis income assistance cheques and the manner in which those cheques are cashed. The Ministry of Human Resources does not direct clients to any particular bank or institution to cash income assistance cheques. That responsibility remains with the client, and solely with the client. Banks require the same identification for cashing cheques from a recipient of income

[ Page 3393 ]

assistance as they do from all members of the general public. In these situations where a client may not have the identification which would be suitable for a bank, we have an agreement to provide a letter of identification for the client. We have done that, and we do it for the particular cheque issued; we don't do it as a blanket policy that carries on for several years. It's just for the one cheque, and is usually in cases where someone is granted a crisis situation and hasn't identification in order; therefore by the time they need more money, their identification and so on is put in order. I am unable to comment on the other part of the question with reference to the Money Mart — the organization that charges a fee for cheque cashing — but I would suggest that you perhaps would like to ask the Minister of Consumer and Corporate Affairs (Hon. Mr. Hewitt), because that would be more in his area of responsibility.

SAFETY INSPECTIONS OF BUSES

Mr. Speaker, if I may, I would like to also respond to a question taken on notice to the member for Atlin (Mr. Passarell). The member asked the question of me in my capacity as minister responsible for transit. To remind the members, the question was: following the government's decision to close the Burnaby testing station on March 9, 1984, what provision has the minister made for regular safety inspections of transit buses after this date?

I am pleased to tell the member and members of this House that B.C. Transit, as part of the annual operating agreement with its service contractors, requires that revenue vehicles be kept in safe, clean and reliable condition, in compliance with the requirements of the Motor Vehicle Act and its safety regulations. The vehicle condition is monitored and maintained through a series of safety inspections carried out by the operator's mechanics, and reports are made out daily by the drivers. The inspections take the form of certain tasks being completed at regular distance intervals. These are periodic inspections. They are scheduled to take place every 5,000 kilometers, 25,000 kilometers and 75,000 kilometers. In addition, at every 1,500 kilometer point a safety inspection is made to check brakes, lighting and door systems. In the small communities where we have bus service, B.C. Transit inspects each vehicle approximately twice per year to ensure that the operator is maintaining the required standards, which is of course a condition of our agreement with them. In Victoria and Vancouver the Metro Transit Operating Company undertakes these inspections.

MR. HOWARD: Mr. Speaker, on a point of order pursuant to standing order 25, relating to the orderly proceeding of business in the House, we would be quite prepared to give unanimous consent to the Minister of Labour (Hon. Mr. McClelland) to make a statement to the House today, if he so desires, concerning the situation in the pulp and paper industry.

MR. HANSON: Mr. Speaker, on another point of order, the Minister of Human Resources (Hon. Mrs. McCarthy) abused the time available for question period. This side of the House always grants leave for ministerial statements or responses to questions. She deliberately ran interference on a sensitive matter before this House.

[2:30]

MR. SPEAKER: Order, please, hon. member. When a member is being disorderly in making a point of order, there can be no excuse for that.

On the first subject that the member raised, as members will remember, the rule about giving answers inside question period was made in this House just a few days ago, and I would commend that to members. It might also be a subject of discussion, hon. members, for any proposed rule changes that the House may wish to entertain at some time in the future.

HON. MR. McCLELLAND: Mr. Speaker, on the same point of order, it's interesting that the members opposite are very reluctant to have questions answered in question period. That's the place where those questions should be answered, because they were asked in question period.

On the other point of order, I'd be happy to ask leave, except for the fact that a ministerial statement doesn't require leave. I'll be happy to make a statement at the appropriate time.

HON. MR. CHABOT: Mr. Speaker, on the member for Victoria's suggestion that there was an abuse by the minister in responding to questions, I can't see that as much of an abuse because of the fact that there were only 47 seconds left in question period. The minister occupied most of time outside of question period to answer the question.

MR. SPEAKER: A valid point, hon. member.

HON. MRS. McCARTHY: Mr. Speaker, I would like to refer to the point of order that was queried. I want you to know that I purposely waited until there was no one on their feet, very much to the end of question period, before I made my statement.

MR. MACDONALD: There is no reason for the minister not to be recognized if it's a short reply. The Speaker himself has said in the past — and we're still under the existing rules — that when ministers have a long reply to deliver, they should not consume the time of question period. I hope the Speaker will enforce that admonition.

MR. SPEAKER: On the same point, hon. members, while we're discussing question period, the Chair would remind members that reading telegrams, letters or extracts from newspapers is an abuse of the rules of the House for question period as well. However, hon. members, that was not brought to the member's attention. If question period were to be enforced strictly as the rules indicate, the question period would not only be short, it would be very unexciting.

HON. MRS. McCARTHY: Mr. Speaker, I ask leave to make an introduction.

Leave granted.

HON. MRS. McCARTHY: I'm very pleased to see in the today a friend and constituent from the city of Vancouver. I ask the House to welcome a very fine British

Columbia citizen, Mr. George Wilkinson — and all the rest of our fine British Columbia citizens and visitors, I should add.

[ Page 3394 ]

Orders of the Day

ON THE BUDGET
(continued debate)

MRS. DAILLY: I'm going to continue my scintillating discussion, which seemed to meet with such approval last night from the members of the Social Credit.

[Mr. Strachan in the chair.]

When I was interrupted by the dinner bell last night, I was attempting to put across to the Social Credit government the great importance of appreciating the fact that there is a definite link between the economy and social programs. Whenever the opposition takes to their feet in this House to react to cutbacks in social programs by the Social Credit government, we are usually greeted by sounds almost like catcalls and putdowns for the very fact that we think social programs are important. I know that Social Credit members pay lip service to this, and they say that they are not actually cutting back anything seriously. This is a tremendous show of ignorance on their side. They cannot understand that when you cut back seriously, as they are doing on social programs in Health, Education and Human Resources, this will have a very negative effect on the economy of our province. This is something that we cannot seem to get through to the Social Credit government. They continue to bring in budgets which are not going to improve the economy.

Interjection.

MRS. DAILLY: Mr. Speaker, I'm used to listening to the laughter when I am trying to discuss the importance of this budget, so it doesn't bother me.

DEPUTY SPEAKER: Hon. member, I'm not....

MRS. DAILLY: But it does bother some people in British Columbia.

Interjections.

DEPUTY SPEAKER: Could all hon. members please come to order and extend some courtesy to the member for Burnaby North.

MRS. DAILLY: As you know, I enjoy humour in the House, but after reading some of the articles in this morning's paper and listening to some of the news broadcasts on some of the things happening in our province today, I really am not in very much of a mood for humour, as many of the people in this province aren't.

When I speak about the fact that there is a definite linkage between cutbacks, social programs and the economy, I hope that someone on the government's side will at least listen to my arguments on behalf of this premise.

I don't intend to dwell on a tragic case at this time because I quite frankly only read what was in the paper and other facts may come out. This morning we heard of the very bad case of a baby who was seriously abused by the child's parents. I want to put this in the context generally. I do not know — none of us know at this time — what caused this tragedy. We know there is something wrong with young parents to begin with who can do this to their children. That is an area that must be looked at from the side of prevention. People who have a tendency to abuse their children are obviously showing signs of that far earlier than the time they become parents. I accuse this government of cutting out prevention programs in the schools that will help the teacher to diagnose people who have serious emotional problems. I'm not saying that this is what caused this particular child abuse case, but it is possible that these parents obviously had some problems that may not have been diagnosed when they were at an earlier age. It also points out the fact that Human Resources may — and I say "may" advisedly — be so obsessed with these cutbacks in their staffing that we are now ending up with cases of child abuse. Child-care workers don't have time to go back and check on these children because of caseloads. If a government wishes to have those kinds of things going on with the citizens of this province, it can be on your head. The problem is that you aren't going to suffer directly; the citizens of British Columbia are suffering.

HON. MR. SCHROEDER: Make up your mind.

MRS. DAILLY: It isn't a question of making up minds. I get tired of hearing "you've got to have money and you've got to get rid of the debt" or "if you want to just give everything to Human Resources...." It isn't either-or. When it comes to money, a government that can borrow $470 million to pay off another debt.... Then I'm told to make up my mind where I am going to get the money from. There is $470 million that I would rather see borrowed to prevent the kinds of things that are going on in this province today, but you are obsessed with showing the public in the next election year that your so-called books are balanced. Balanced on what? It's on the heads and the suffering of the people of this province, and you and future generations are going to have to live with it. That's the tragedy. The tragic effects of many of the things being done by this government today will not be shown for a number of years when, hopefully, they are long gone over there. A government with compassion can be brought back, with their heads in the right place, and it'll also know how to handle money, which I accuse the Social Credit government of being absolutely incompetent in.

Mr. Speaker, let me give you an example of what is happening because of this government's premeditated policies of cutbacks. We have an example of the major cutbacks that are now taking place in the Vancouver School Board, although Burnaby faces the same. They are going to lose 15 child-care workers. I guess they are superfluous. "Oh, we've got to cut back. What do we need these child-care workers for?" At the same time that these child-care workers are being fired, those people who go around and help the teacher with the child who is diagnosed as having serious problems, the classes are becoming larger. So the average classroom teacher simply doesn't have the time to deal with these children with serious problems. They can't even turn to a child-care worker now, in most cases.

It has been stated by one of the child-care workers: "School is where the action is. Without the workers in the schools, many kids would be in potentially dangerous situations." So what this government is doing with their shortsighted and callous policies is creating potential problems which future governments and future citizens are going to have to deal with.

[ Page 3395 ]

Mr. Speaker, Stan French of the Vancouver School Administrators' Association, talking about the provincial government, said this: "They say they are doing this in the name of restraint." My God, what would you do without that word restraint? "We ask the government to rescind its decision in the name of genuine restraint and compassion." And that's what I'm asking that government to do — to look at what you are actually doing to this province and ask yourselves: is it really restraint? What about compassion? I ask you about compassion. Has it gone? Are you so obsessed with this business of showing the electorate that your books balance? We all know it's just a shell game anyway. You talk to anyone out there who has been reading this nonsense in the budget speech, and they're all scratching their heads. The money's been moved from here to there. But the laugh of it is, Mr. Speaker, that nothing's improving in this province. The only thing that is improving is the ability of that government in their handling of rhetoric and words: restraint, downsizing, privatization. They think if they keep saying those words over and over again they'll lull the public into the apathy of thinking that those words are improving their living conditions. Mr. Speaker, it's been proved that this obsession with privatization, in many cases, is going to cost the taxpayer more money. I say to you: you're going to find that out. Unfortunately it will be too late for the public.

You know, Mr. Speaker, there are cases upon cases of this stupidity of bringing about cutbacks in programs and eroding them...that are going to cost more money in the future. Many of these young people unfortunately could end up in institutions, and the rest of the taxpayers will have to finance their upkeep because the Social Credit government didn't have enough foresight to spend their money on prevention first.

The same thing certainly applies to education. This government doesn't seem to see the connection between education and the economy. They don't seem to understand that as public education degenerates, so our economic base erodes also, and even more quickly. The education system may be far from perfect, but if you keep bringing in policies that discourage people from having the opportunity to continue in school and become educated, in time that will affect the economic development of our province. When times improve we are going to end up with a whole group of work-illiterate students. Right now many students are just coming out of high school, or not even finishing. They are sitting there at home. Some of them, if their parents can't look after them, are going on welfare. Would it not be better to take some of that $470 million that's borrowed to remove the B.C. Rail debt and do something positive with it for our young people? That's what the NDP recommends.

Let me give you an example of what a Labour government is doing in New Zealand. They accept the fact that they do not want to see their young people sitting around on the dole, as they call it in New Zealand — welfare here — tragic, demoralized, doing nothing. Everywhere you go in B.C. today we see these under-25-year-olds. It's tragic. This government is doing nothing about it. Anyway, you know what they do in New Zealand? This is something that they are starting as part of their new policy — the Labour Party, rather. Labour's economic program is primarily aimed at getting New Zealanders back to work again. I see nothing in the Social Credit policy here that even talks about unemployment.

[2:45]

Interjection.

MRS. DAILLY: I have read it.

To this end the party has proposed to guarantee employment for school-leavers, to abolish the dole in favour of training programs, search allowance and work schemes, and to implement a far-reaching program of investment in industries that will both capitalize on the country's established strengths in primary production and provide a more immediate payoff in job creation. In other words, the Labour policy — and it would be the policy of the democratic socialists of B.C., Mr. Speaker — is that instead of letting these kids out and putting them on welfare, take some of that money, which you have but have misplaced in things such as borrowing for the B.C. Railway, and put these young people into some training jobs. Some of you may say: "Typical of the NDP — short-term programs." Those short-term programs can be created so they become a transition to learning a skill, because in the future we hope this province will come to its senses with a government that will realize that we have to diversify our skills and our industries, and that we can no longer depend just on the primary industries. We should be thinking now of training those young people with some of those skills now.

Another area that bothers me considerably about the Social Credit government is their lack of planning. As far as I can see, they are not doing anything about looking at the skills that will be needed for the future and preparing our children for them. If we are doing that, I have yet to hear anyone specifically tell me what Social Credit is doing about it. It becomes very demoralizing, as we all know, to sit at home when you want to learn something and you don't have the opportunity. I heard a young man under 25 speaking on a show this morning; I don't think it could fail to touch any of us. He said: "I've been hunting for work. It isn't that I don't want to work. Yes, I'm one who's going to be cut back in my welfare, but I'm not a welfare bum." The implication is that if young people get out and move, they can find work. He said:

"I've been all over this province. There is no work. I want to work, or at least give me training."

I know. Mr. Speaker, that my light is on, and I regret that because I have quite a bit more material. I know my listeners regret it also. I wonder if I could conclude with a paragraph which I find expresses the way I and many others on this side of the House personally feel about the present situation. It is from Robert Reich, an economist who is the opposite of Milton Friedman. It's called The Next American Frontier, and I would recommend it to the members of the Social Credit Party particularly. You seem to have been brought up on the bible of Friedman; may I suggest you try this one. I'd like to conclude with this paragraph. Robert Reich says:

"We will be able to conquer unemployment and inflation and enjoy enduring economic growth only to the extent that we harness the energy and the ideals of all our citizens to the process, spreading the burdens and benefits equitably, making good the losses attendant upon economic change, and striving for justice and decency. A social organization based on greed and fear will fail, because it cannot enlist the commitment of its citizens. The notion that social justice must be sacrificed for the sake of economic growth is simply wrong. Social justice is not a luxury bought at the expense of national economic health. It's the means for achieving and maintaining prosperity."

[ Page 3396 ]

HON. MR. HEWITT: I'm pleased to speak to this gathering this afternoon. I have a clear field of vision; I can see everyone here. I'm pleased to stand and support the budget, and I compliment the Minister of Finance, whom we refer to in a friendly way as Dr. No, as chairman of the Treasury Board. He's a man who works hard at his job and has a difficult task, and I think the budget he put before this House on Monday of this week indicates the amount of effort, time and dedication he has put forth to assuring a good, sound future for the people of British Columbia.

We all read with interest headlines in the newspaper, or watch TV, or listen to the radio, and after the minister's speech some of us on this side began to wonder whether or not those who reported the budget speech were in the same room, the same city, the same province or the same country. In my opinion, the headlines after the speech was made should have been positive headlines. There should have been a headline that said: "British Columbia Leads the Way. The Cost of Government Has Been Reduced." That would have been a positive headline to indicate to the people of British Columbia that this government addressed the question of ever-increasing cost of government and reduced it. Wouldn't it be nice to see a headline that said: "First Time in 31 Years Provincial Government Has Been Reduced From the Previous Year's Expense"? Wouldn't that be a good headline for the consumers of this province to read or to see on the television? It would give them some indication that the government of this province recognizes that it must show leadership in controlling its costs so that those in other parts of Canada or in the private sector can follow our lead. Wouldn't it be nice, Mr. Speaker, if the headline had said: "Government Ensures Social Services Maintained While Reducing the Cost of Government." That would have indicated to the senior citizens, the handicapped, the disabled, people on fixed incomes and the unemployed that we were ensuring that we maintain those social programs — the people programs — that are needed, while at the same time controlling the cost of government and eliminating some of those programs which, for some reason, once introduced and operative, everybody seems to think should go on forever. It is unfortunate that the coverage that was evident after the budget speech was in the negative.

We have a number of people here, Mr. Speaker....

DEPUTY SPEAKER: I don't believe we have enough.

MR. NICOLSON: I feel kind of lonely. I don't think there's a quorum in this House.

DEPUTY SPEAKER: Pursuant to our custom, I will ring the bells and see if we can summon more members.

Hon. members, the quorum is satisfied. Please continue.

HON. MR. HEWITT: Mr. Speaker, I know that the members are rushing back into the House to hear my comments, because they're very positive comments.

We hear the doom and gloom from across the way, but I think if they were to look at the budget figures, instead of just attacking for the sake of attacking the government's actions over the past year, and not looking to the future, they would see on page 59 some of the improvement in revenues that are anticipated in this budget, and they'll move from our figures of 1983-84 from $7.1 billion to $7.7 billion, a substantial increase in personal income tax, corporation tax and the social services tax. Social services tax must mean that more product will be sold. As a result it means that inventories have to be renewed and that product has to be manufactured.

Personal income tax increases — and I think the figure is something like 11.9 percent — must mean, if the members opposite can figure it out, that more people are working and our income tax revenue to the province of British Columbia has increased. That's a positive report to give to the people of British Columbia, as opposed to saying that everything is doom and gloom.

On the expense side, a positive report to the people of British Columbia: expenditures are down from $8.4 billion to $7.9 billion, which is lean, efficient and good government for the province of British Columbia. The deficit that accumulates, and which we know is a problem in all governments, is a manageable deficit and one which can be paid off as the economy further improves. That is the plan that this government has had since February 1982, when the Premier came out with his program of restraint, reassurance to the public of British Columbia and recovery. We're on that road to recovery, Mr. Speaker. The budget figures indicate revenues up, but it also indicates that this government is going to be a lean, efficient government and will not add additional costs to the consumer and the taxpayer of British Columbia.

Interjection.

HON. MR. HEWITT: I hear a noise across: "Take a look at royalties." Yes, I can look at royalties, and I can look at other things on that same page which should indicate to you that those products we trade on the world marketplace are the ones that impact on us the heaviest — the forest industry, the mining industry. Where those industries are not moving — which it would indicate to you, if you took a moment — when those revenues drop, we must cut our cloth to fit those revenues, which is what this government has been doing since 1982.

[3:00]

Mr. Speaker, if you saw the news on TV last night that the federal budget was up 10 percent over 1983-84 — and they anticipate a $30 billion operating deficit for this coming fiscal year; $30 billion and an accumulated deficit of $181 billion for the government of Canada.... It went on to say last night — and it's in the Times as well — that 20 cents out of every dollar spent by the federal government will go to interest on debt. That's interest paid on something you've already used. They have no plan in Ottawa. They just keep going down that slippery road to ever-increasing deficits. The question has to be asked: "Is that the kind of legacy you want to leave for your children?" It's not the one I want to leave for mine.

The load at the federal and provincial levels will become so great, if there isn't a plan put into place to see recovery happening and to take advantage of an upturn in the economy, as this budget.... Mr. Member for Nelson-Creston (Mr. Nicolson), you're a former school teacher. If you read those figures — you're good at math — you can identify those areas where revenues are down in some cases but improvements are indicated, which means more people are going back to work. But at the same time, as good managers — not of our money; it's not our money we're managing; it's the people's money — we've attempted to keep costs down wherever possible. Essential services have been maintained,

[ Page 3397 ]

and I think it's quite evident, when you look at the figures with regard to health, what we've attempted to do there.

British Columbia is leading the way out of the recession, and it's fair to say that politicians in other provinces and in the federal government had better forget about being nice guys, because most politicians like to be nice guys. They like to say: "Sure you can have that deal. Yes, we'll build this. Yes, we'll pay for that service. Yes, you can have an increase in benefits, etc. No, there won't be any user fees." You can say all those things. But I'll tell you, the time is over for being a nice guy in government, because what the people put you in this office for is to ensure that there is a future for their children in this province. We'd better — when I say "we" I mean the federal government and other governments — follow the lead of British Columbia and start saying no to some of those special interest minority groups who keep wanting more, more, more. There isn't any more, Mr. Speaker.

We've done that from 1982, and we went to the polls in 1983 and got an increased mandate — on what basis? On the basis that we said that we were going to control this monster called government and were going to control spending and were going to try to cut down the cost of government. We came back with an increased mandate. Those opposite who survived are still saying that we aren't doing it right, but the people of this province, as late as the Vancouver Sun poll in December indicated.... Our popularity, which was 29.6 percent in September.... When the public was asked the question by the Vancouver Sun poll in December, 41 percent said: "Yes, we would vote for the Social Credit Party." Interestingly enough, Mr. Speaker, in September, when we were 29.6 percent, I believe the NDP was 29 percent. They were pretty close to us. But by December their popularity had dropped, even after all the organized reaction from Solidarity, the union movement and the leaders — the Keuhns, the Kubes, the Kramers. All those people, all their actions — the public didn't buy it. They didn't buy it at all because they recognize that we have to manage their money in a responsible manner.

One tax increase we introduced — the health care maintenance act that was introduced here budget day — results in a surcharge of provincial taxes, and that's been deemed as a joke by a federal minister. It's no joke. If we're going to have a health care system in Canada that's fair, then the feds better quit playing politics with health care in this country. If they met their commitment of 50 percent of health care costs at the provincial level, then that provincial income tax surcharge would not be needed. The health care maintenance tax is not penalizing the B.C. citizen; the political rhetoric at the federal level is. I think more people should be aware of the reasons for the surcharge: the fact that there isn't that sharing arrangement that there's supposed to be with regard to health care costs.

Talking about user fees, the vast majority of people have no objection to user fees. The $10 or $20 — whatever that figure might be — for a room in a hospital per day, related to the approximately $300 per day to operate that room.... I don't think there are very many patients who would say that that was too much or excessive for the best hospital care in the world. For those who cannot pay, there are social programs by the Ministry of Human Resources to assist them. Nobody gets left out in the street because they don't have the fee for a hospital bed. If they are sick or injured, they are able to find entrance to the hospital.

Mme. Begin, the federal minister, said: "It's a joke. The whole thing's a joke." Unfortunately the thing she refers to is the federal government. That's the joke, Mr. Speaker, and something should be done about it — in the very near future, I hope. But I do believe. as the Minister of Finance said, that there should be a Health and Finance ministers' conference as soon as possible to iron out those issues that we seem to be debating in the press, as opposed to sitting down around the conference table to resolve them between the two levels of government.

DEPUTY SPEAKER: Hon. members, discussion of health as it appears in the budget speech is quite in order. Discussion of a specific bill which is before the House is anticipation. I know it is a difficult line to draw during this type of budget debate, but I am sure all members can realize what the difference is.

HON. MR. HEWITT: Thank you, Mr. Speaker. I was trying to be on that fine line.

I have one last comment in regard to the concern about deficits. In Washington a number of analysts were surveyed by the business community to see whether or not there was acceptance of a restraint program or less government spending. We often talk about Milton Friedman, among others, but w are talking about analysts, those people who work in the field of economics and money management, the ones who provide the financing for governments, industry and business. The result of the survey was that 97 percent said the President and the Congress should take deficit-reduction action this year. I raise that point because, as the member for Nelson-Creston (Mr. Nicolson) knows, you can have two economists and they won't agree. But when they do that kind of a survey and come up with that kind of a percentage, I begin to think that maybe political rhetoric is what we are dealing with half the time when we talk about restraint, no restraint; deficits. no deficits. There are a large percentage of professionals who say it is time to restrain government spending in the United States.

I want to talk on some of the specifics in the budget. I am pleased to see the tax exemption on safety equipment — such things as child-restraint devices, oxygen containers, etc., for those who need them. That's prevention. It encourages prevention, and enables people to buy, at less cost, a product that may save a life or reduce accidents. As minister responsible for the Insurance Corporation, I am very pleased to see the Minister of Finance eliminate the sales tax on child-restraint devices for automobiles.

In other areas, there is the continued restraint on public sector wages. I think the Minister of Finance, continuing with the compensation stabilization program, recognizes that the public sector is paid out of the economic activity of the private sector. All public servants get paid primarily from activity in the community. In the workplace, by those businessmen — large and small — who create jobs, generate revenue and pay the tax that of course pays our wages. So we have to be followers when it comes to settlements, etc., as opposed to being leaders. We know — and we stated this a year ago — that the private sector has that thing they call restraint, and that's shutdown, bankruptcy, loss of sales, layoff, etc. Government has to recognize that although we can carry on by raising taxes, that's not the answer. We have to respond and cut our cloth to fit the ability of the private sector to pay, and we have done that. Look at the reductions

[ Page 3398 ]

on page 26 of the budget — all the expenses in the ministries. The member for Esquimalt-Port Renfrew (Mr. Mitchell), who's going to look it up now for the first time, will see that the only ministry with an increase in budget is Health. All the others have been reduced, for two reasons: one, we're looking at more productivity; the other is the ability to pay. Maybe four employees will have to do the job that five used to do in the good times. Maybe three will have to do the job of four. If we can keep that government machine lean, we'll assist the recovery in this province. If we can address redundant programs, those which, once instituted, become evergreen, and say they're no longer needed or we can't afford them, then that will be of great assistance to us — and that's what we've done in this budget.

I want to touch on one item in the budget which deals with the payment to B.C. Rail. We've had a lot of comment about that. I think the member for Burnaby North (Mrs. Dailly) called it a shell game, moving money from here to there. I'm going to go back to that quotation in a minute. I'm sure she'll have an explanation at some time as to whether or not she's contradicting herself. The royal commission — I believe it was in 1978 — made a report on BCR, which stated:

"We recommend that the present total debt of close to $700 million be removed from BCR's account and assumed directly by the province. Such refinancing will result in a more realistic statement of the province's financial position and oblige the province to retire the debt in an orderly manner. It will also relieve the personnel of the railway of the discouraging prospect of everlasting increasing indebtedness and place an achievable goal of profitability within their reach."

We move to the report of the auditor-general of March 31, 1979:

"I recommend that such an accounting policy be established for the accounts of the province. Application of this policy would result in the net debt of the British Columbia Railway Company being recorded as a direct debt of the province, unless other financial arrangements were made to service this debt."

This recommendation was from the auditor-general — the watchdog of government, as the member reminds us so often — who was appointed by this government. I was pleased to be the chairman of the committee that recommended her to the Legislature.

We move to the report of the British Columbia Railway board of directors. They said:

"This debt has no prospect of being repaid out of BCR revenues, and the assets it represents cannot be turned to account. We believe that, assuming no significant downturn in the provincial economy, if BCR were to receive the financial restructuring and the relatively modest operating subsidies recommended by us and the royal commission, BCR would be in a break-even position and would likely generate the bulk of funds required for capital expenditures over the next five years, except for new construction. We believe that the opportunity and challenge to achieve financial self-sufficiency is important to the morale of BCR, and strongly urge that these recommendations be adopted."

I have another report from the auditor-general in 1982, which basically says the same thing.

[3:15]

Then I move to the Committee on Crown Corporations:

"The committee concluded that this positive result continues to be overshadowed by long-term debt burden, which the railway cannot hope to service or repay even from efficient operation. It was the committee's major recommendation that, in light of the improvements in the railway's operating and financial position, the government should financially reorganize B.C. Rail, closing the door on the past and providing management with the incentive to follow through on the positive achievements of the past five years."

That was their fourth annual review of the corporation. Then we come to their April 1982 inquiry into the B.C. Railway, which basically says the same thing. The committee believed that the government should assume the railway's net outstanding long-term debt, which stood at some $662 million as of December 1980. In return, the railway should issue the government common shares of equal value. I believe that at that time the government took over the shares of the railway. The interesting part, after hearing the dialogue from across the way.... The Crown Corporations Committee is a legislative committee, made up of members from both sides of the House. The member for Burnaby North, who said it was "a shell game, moving money from here to there" in her comments a few minutes ago, was a member of the committee that recommended the cancellation of the BCR debt. You can't have it both ways. The member for Skeena (Mr. Howard), who gets up and makes great speeches with regard to how we're running this province, was also on that committee.

MR. R. FRASER: It's called selective amnesia.

HON. MR. HEWITT: Selective amnesia, selective quotations, call it what you will, but the House Leader for the opposition, the member for Skeena, was also on that committee. Unfortunately two other members on that committee aren't here: one was defeated in the campaign; the other didn't run.

The second member for Vancouver East (Mr. Macdonald), former Attorney-General of this province, who prides himself on accurate statements, was on that committee. He must support that. As a matter of fact, I assume he will get up and commend this government for its actions in following the recommendations of the committee.

And last, but not least, my good friend the member for Nelson-Creston (Mr. Nicolson) also was on that committee, and I know he's an astute mathematician. He has some problems with nuclear power, but he's a good member and a good mathematician, and I know he would feel the same. He endorses that and will speak in the positive when he makes his comments.

Mr. Speaker, I think it's fair to say that in moving those dollars across to BCR there is the flexibility of saving dollars, because once paid to the sinking fund of BCR to retire that debt, there is the opportunity for government to retire its debt, if you will. In assuming the $470 million it will have the flexibility to repay that as the economy improves and as the marketplace is right for such a transaction. It's better control over our finances, Mr. Speaker. I don't think there should be any negative comment about that issue at all. As a matter of fact, the Minister of Finance should be complimented on

[ Page 3399 ]

addressing that question and having control over the payment of that debt.

Mr. Speaker, there is another item in the budget which may be considered negative by some, but I think it is positive. Student aid grants are being scrapped and replaced by loans. There's an old adage. In my opinion, if something is given to you it tends to have less value than if you've earned it. I suggest to you that those who are striving for academic excellence in this province, knowing that they have a loan, make a commitment investing in their future and are pleased and proud, when it's all over, to pay back the government who gave them that assistance so that somebody else's son or daughter can make the same use of those dollars. That's a positive step. It's an investment in the future. I'd like to see if we could possibly build up a loan fund that would be self-sustaining at some point in the future. In the throne speech there was comment about a student venture program, an exciting program which I'm sure the Minister of Labour (Hon. Mr. McClelland) will go into in detail later in this session, along with his 1984 jobs for youth program, which again puts in the hands of the young person the opportunity to go out and sell himself. That's far better than going out and handing them something. It makes far better citizens in the future.

I'm not sure how much time I've got, but I want to touch briefly on the Ministry of Consumer and Corporate Affairs and the fact that we are turning over to the private sector the licensing of real estate agents, insurance salesmen, investment dealers, etc. We've turned over the regulation and licensing to those associations. Mr. Speaker, the legislation and the regulations as far as government is concerned are still in place. But the testing and examination and the conduct of members of any society should be judged by the members of that society. I belong to a society of accountants. We don't have somebody sitting in government telling us whether we're doing it right or wrong. But we certainly do have a society that ensures that our conduct is correct. The lawyers have their own association; the doctors have theirs. So what's so wrong about turning over to the Real Estate Council, if you will, or to the travel agents' association, the real estate agents' association, or the Insurance Council the ability to monitor the expertise and the quality of their own members of that association? The regulations and legislation are still in place should there be a problem with any one individual. But at least we get that bureaucrat, the government, out of the regulation, if you will, or determining whether somebody has capability or not before they start. I don't think we need that. I think governments are elected to govern, but leave the freedom out there in the marketplace for those people to prove themselves.

The Finance critic, the member for Nanaimo (Mr. Stupich), touched on a few things, particularly in the news media, where I read these comments. He stated that the Toyota plant was a terrible thing. I can't understand that, because the Toyota plant being built in British Columbia, employs people in British Columbia. I'm not sure whether in his comments he meant he'd rather see people on welfare than working and earning a wage. I don't understand what his rationale is in that regard. He would rather have people on welfare, I guess.

The other was the 8 percent surcharge on provincial tax. He stated that it was unfair. I think he said that the government should have looked to high earners and the banking institutions for more money. Well, if it is an income tax, it does identify with high earners. If you have a low or fixed income, or no taxable income. there is no surcharge. But the more you earn and the more taxable income you pay.... The surcharge then impacts on those of us who make better than the low-wage earner or the person on fixed income. So we have identified the high earners: those who earn more will pay more in that surcharge on provincial tax.

In winding up, I would say that I realize that the role of the opposition is to oppose. I guess if we were on the other side of the House we would probably be quick to find fault with budgets coming in....

Interjection.

HON. MR. HEWITT: No, I've never been on the other side. and I don't intend to be, Mr. Member,

At the same time. I think their credibility comes under question. When you look at previous years' Hansards, you find that they, said to the government: "You've spent too much" or "You haven't given enough attention to this area or that area." I can remember the former member for Victoria with his great displays in the House, which he finally had to take out. But now we've reduced the budget and we're accused of not spending enough. You can't have it both ways.

The people of the province indicated very clearly at the polls — not only at the polls where they vote, but also in polls taken by outside parties, not the government — that they want the government to continue restraint and reduce spending. they want the government to downsize itself, to get out of the private sector and the marketplace as much as possible. They want less regulation, and they want the ability of self-regulation. I think that we as a government should give them that opportunity. I strongly believe that this budget addresses those issues. It recognize today's realities, and it provides a solid foundation for future economic growth. I'm very pleased to support it.

MR. NICOLSON: Mr. Speaker, in listening to the Minister of Consumer and Corporate Affairs, speaking about the Crown Corporations Committee and its recommendation, I was reminded of the statement made by Marlowe: "But that was in another country, and besides, the wench is dead."

Another thing that the minister brought up in his speech was the $181 billion federal deficit, which works out to $6,000 per capita. I would remind the minister of the provincial deficit, which is $15.3 billion, and that works out to $5,400 per capita. There is not a great deal to pick between the two: it's tweedledum and tweedledee. I don't know how the pot can call the kettle by another name.

This government is continuing its unrelenting war on prosperity, taking away opportunity and drying up consumer confidence. By the admission of the Minister of Finance (Hon. Mr. Curtis), we may very well never come out of this recession before we enter the next one. That is one thing I do agree with in the budget speech, and it is because we have treated the recent recessions in a much different way from the rest of the country. I don't see Alberta or any other province killing themselves to follow the so-called leadership of this particular province. This government is waging a war on prosperity, and as in most wars, it is being waged at the expense of the lives of the young. In this province we have about 13 percent unemployment, but we've got over 25 percent unemployment among the young people, who have never had the opportunity to take part in the economy, have a

[ Page 3400 ]

meaningful job, a meaningful career; indeed, many young people have left high school or university and seen no jobs.

Last evening I met a young lady who graduated in education. As a matter of fact, she taught in your riding for one-half of a semester, and that is the total work experience she has been able to have since graduation — no tenure, of course, and going no further in her chosen profession at the present time. That waste is almost as tragic, and in some ways even more tragic, than what happened in the last Great War. This is not the work of some dictator or politician run mad in some foreign country; this is the work of politicians who have become very doctrinaire and very much taken up with their own rhetoric and their own ideas, and who can see no fault in themselves. These politicians in our own country are waging this war against prosperity in British Columbia, which should be a prosperous province. As in the tradition of all wars, it is at the expense of the young, the lost generation.

[3:30]

I find that very unfortunate, because most of us here grew up at a time where we did not have to worry about student summer employment programs from government, because there were enough student employment programs available through the private sector to absorb all of us who wanted to work. But that isn't the case today. There is a failure by this government to recognize the total change in the nature of work, the rate at which jobs are being created and the rate at which jobs are being lost. There is a fundamental revolution that is going on in this province, and we will have to continue to say this until it becomes well understood. A fundamental change has taken place in these last two decades of this century which will see more change than happened from the beginning of the industrial revolution right through to the middle of the 1950s. We will see more change in this short compressed period of time than we have ever dreamed of seeing before.

Budgets have certainly changed since I first sat in opposition in this House. The first four budgets of the Social Credit government, starting in the fiscal year of 1976-77, racked up fairly impressive surpluses. I suppose Mr. Evan Wolfe was Minister of Finance through most of those years, if not all of them. We saw surpluses: the first year, $96.6 million; the next year, $204.5 million; the next year, $179.9 million; and the next year, $446.9 million, for a total of almost $1 billion. At the same time there were assets that had been acquired by the previous NDP government and by the previous Social Credit government of W.A.C. Bennett, and there was also a cash balance on hand. The revenues tended to come in ahead of expenditures. That took a very sorry turn after the fiscal year 1979-80 when we changed from a cash to an accrual system of accounting. But that wasn't the fault of the current Minister of Finance; it just happened to coincide with his appointment.

If you take the surplus that was available at that time and add it to the cash balance that would have been on hand at the end of a fiscal year, in 1979-80 there was $1.961 billion, almost $2 billion, available in terms of surplus cash, either in the form of special purpose funds or actual liquid cash in the bank. In his first fiscal year, the present Minister of Finance actually spent $256.7 million more than he collected in revenue — in the fiscal year 1980-81. The next year he spent more than he collected in revenue by $184 million. Those were good economic years. The next year saw a serious downturn in the economy, and he overspent by $978.2 million, which had reduced that cash balance from almost $2 billion down to almost half a billion dollars. Then we saw the budget of seven and a half months ago, and now we see the budget projections for this year. By the end of this fiscal ear we will spend $1.3 billion more than is collected in revenue, and for the fiscal year that we are now starting to debate there is a projection of $671 million more, leaving us in debt $1.4359 billion. Since 1979-80 there has been an excess of expenditure over revenue of $3.396 billion.

This government comes in here as if they have suddenly seen the light, when we have told them many many times in the past that they were being reckless, that they should be more cautious, that the good times would not go on forever and that if they were going to use any kind of Keynesian economics they would have to put money aside. They should have been building up more special purpose funds rather than spending it in good fiscal times. We have seen the day of reckoning. We have seen a time when, due to the policies of this government, which concentrates solely on export of raw resources — unfinished resources and unfinished materials — and has made us totally dependent on the export of unfinished goods for the mainstay of our economy.... They have seen us the victims of worldwide recession. They even indicate in the budget speech that we are more affected than other areas of the country because we are less diversified. Whose fault is that? Who has been government for over 30 of the past 34 years but Social Credit? It is because Social Credit has been government that we have not seen any diversification in the economy, and for that reason we are exposed to the vagaries of worldwide recession and experience it much more deeply than other parts of this country. Even some of the maritime provinces are better equipped to ride out these kinds of downturns.

We are in bad economic times now because we have had a government that has been very arrogant, self-satisfied and complacent — a government that would not listen to the opposition.

In 1978 I put out a monograph dated January 31. I asked the question with regard to B.C. Hydro: "Is supply outstripping demand?" I reached conclusions which led to headlines: "NDP Urges Inquiry — Ten-Year Pause in Hydro Projects." I said at that time: "Currently planned projects will produce 70 percent more energy by 1987 than the province will require. If we overbuild our system and they then try to export energy when they know we have an energy surplus, we're not going to get a very good price for it." Mr. Speaker, I said that we could postpone the construction of the Revelstoke Dam, the Hat Creek thermal coal generating plant, the Vancouver Island thermal generating plant and also some....

HON. MR. McCLELLAND: What Vancouver Island thermal plant?

MR. NICOLSON: Oh, you've forgotten so soon? You've been a Minister of Energy. I should think that you would have known about it, because it was certainly in the prospectus of B.C. Hydro to the American bond market in 1977.

HON. MR. McCLELLAND: No, no. You're wrong again.

MR. NICOLSON: Do you want to resign if I can dig that project out of government documents?

[ Page 3401 ]

Mr. Speaker, I was not listened to, and that just shows how stupid that government can be. I was not going to name any particular member of that government — perish the thought.

Because of the stubbornness of the government, they went ahead. Eventually some reason sunk in. They eventually cancelled the Hat Creek thermal plant and the Vancouver Island thermal plant. Now, having gone ahead with the Revelstoke Dam, we even have from B.C. Hydro the admission that there is enough surplus energy for a ten-year moratorium. I predicted that the government would have to go to the export market, and I predicted that they were going to go to the export market in a buyer's market. That is in the Vancouver Sun of February 7, 1978. Failure to listen to the opposition is the reason that we have to take such drastic measures which are leading to the question of whether government measures are perhaps complicit in the death of two school children, whether or not the government might be complicit in the abuse and death of a child, reported in the paper this morning. It is in this atmosphere, where we have this cold-blooded approach towards all kinds of cuts, that people have to question, every time a tragedy occurs, whether this might not have been avoided. Mr. Speaker, it could have been avoided if this and other things were listened to.

This isn't the only thing that has concerned me in the past. It isn't the only kind of decision that has led us into the problems that we are in today. The northeast coal project, for instance, has cost us in other ways that I don't think are even promulgated in any of the press articles. We used to collect royalties on coal. Then there was a change in formula to a profit type of revenue. Back in 1975 the royalty on coal was about $1.50 a tonne. When the Alberta government had a sliding system of royalties up to $9 per tonne, depending on site-specific costs, we had announced a $2.50 royalty. Even though just about everybody in that 1975 election was taking pot shots at us, I must say that Edgar Kaiser did not. Kaiser coal did not. Kaiser and Fording were the main companies paying that royalty at that time. There was no objection to it, but the current government went ahead and ignored that obvious source of revenue, which could have increased very shortly thereafter to $5 or even $10 a tonne, had it been indexed and had the royalty stayed in place. Had it just increased, by about the year 1981 we would have realized about $102.7 million in increased revenues. Had we increased it and tested the market on that a little bit more, we probably could have realized as much as $500 million in increased revenues. We could have done this, it's quite obvious, because Kaiser turned around and sold BCRIC the resources of Kaiser coal. He did it at a very good price, a very good deal to Kaiser. One of the things he sold was the very low rent that the government was collecting for the privilege of harvesting a non-renewable resource and exporting it out of this country. For that privilege we could have been asking a great deal more. So we've probably lost about a half a billion dollars and would not be faced with some of the problems we see today.

[3:45]

[Mr. Pelton in the chair.]

So we can ask ourselves: why did we allow that to happen? Well, we allowed it to happen because we wanted to give every chance to a project in the north which was really premature, which was uneconomical, which flew in the face of the predictions of the world coal study, and which, even today.... I read an article — I think it was in the Vancouver Sun — the other day by someone who was actually defending the northeast coal project. But he defended it by saying that we don't have to worry about the Japanese cutting back on the volume of coal from the northeast, because that isn't where they'll cut back. It's important to them to keep that project going. What they will do is cut back their volume from one of the projects in the southeast, which have already been amortized and paid up. Of course, we've seen lots of evidence of fields being shut down and contracts being negotiated downwards in the southeast. We have placed millions of dollars into the northeast coal project at the expense of economic activity in the southeast, and now we see this shifting of $471 million. Even people like Ken Bell are asking the question: "Is BCR heading for the auction block?" I don't think Ken Bell is looking at the politics of this. He certainly is questioning, though: "Why now?" He says that what perplexes him is Curtis's timing of the move.

In the face of nearly the worst unemployment in any state, province or territory of Canada and the United States combined. Curtis finds nearly half a billion dollars for a railway, and while he is doing this he is cutting government services further and raising taxes even higher. It hasn't taken long for the vocal minority to question why the railway company got $470 million while the unemployed got nothing. No doubt there will be other variations on the theme in the next few weeks, but the basic refrain will remain the same: why the BCR? He comes up with the logical reason and that is privatization. The government is going to reduce the debtload of BCR in order to pave the way to privatization.

There's another interesting thing about the mistakes we have been making and the price we are having to pay today with this war on prosperity being waged by the government. We see that the South Koreans have discovered coal, and they are spreading their net even wider to ensure long-term supplies of coal to drive their energy plants in a fast-growing economy. Energy-poor South Koreans are also finding their own supply in a wide-ranging exploration program. While they have long-term contracts to buy B.C. coal, each new discovery reduces the chances of them increasing their import volume significantly. The Korean mining promotion group has announced that Korean explorers have discovered a big coal deposit on Kalimantan Island in Indonesia — the biggest discovery so far for the Koreans, who are newcomers to the coal exploration game. The initial value placed on the reserve so far is identified as $14 billion.

We see more and more coal being discovered. Going back to the days when Deputy Minister Sandy Peel cautioned the government against signing the contract — told them to wait at least another six months — we see that the government went ahead. The government has not listened to the opposition. They have not listened to some of their top-level advisers. They have gone ahead in spite of the best information and have put us into a huge debt, both direct debt against the province and indirect contingent liabilities against the many Crown corporations. The government also went ahead against a lot of good advice — I certainly gave them advice — when they created the B.C. Systems Corporation. They had advice warning them of the change that was taking place in the nature of computers. The government went ahead, and they based a whole white elephant out on Blanshard Street around a centralized mainframe computer. They built a huge building costing almost $40 million, which is about one-third

[ Page 3402 ]

of the price of the B.C. Place Stadium. That is a megaproject — one that doesn't get heard about too much by our constituents up in Nelson-Creston or constituents up in places like Vanderhoof and Fort St. James.

The province should be a darned sight more annoyed and angry than they are about even the B.C. Place Stadium. There can be some defence for the B.C. Place Stadium, rapid transit or building a new convention centre in Vancouver, and all the other things that seem to be being built in Vancouver and don't seem to be being built outside the lower mainland. That is a project that was completed last summer, and within three months it was put on the auction block. I don't know who the takers are so far, Mr. Speaker, but I know who got took. This government is going ahead in spite of warnings.

There are other wastes in the B.C. Buildings Corporation and in the reorganization of the Ministry of Forests. Their building occupancy costs are rising in three successive budgets from $3.5 million to $10.5 million to $19.5 million, which is symptomatic of the kinds of reorganizations that have gone on where government has gone top heavy.

What is happening with the downsizing? You are not downsizing the top-heavy; you are getting rid of the foot soldiers — the people who do the work. You're getting rid of them when, in fact, in many places we need even more.

You're getting rid of conservation officers. I don't know if there is going to be any game to protect from wolves, hunters or anyone else when the poachers get finished in the next couple of years. It's open season in British Columbia. Letting go of conservation officers! There won't be a fish to catch or an animal to show to your children. There won't be any wolves, because the wolves who don't get shot are going to starve to death. This is because the government did not look at this Legislature as a whole. It didn't even look at its back bench in most cases; it just looked at the little inner circle called cabinet. The cabinet has even lost control. They are now saying: "I don't know, I just take orders. I am going to hear about it." Some students listened to the budget speech just the other day and then went down to ask the Minister of Universities, Science and Communications (Hon. Mr. McGeer) about the details of this new student entrepreneurial program, and he said: "When I hear about it, I'll tell you." He doesn't know what's going on. Who knows what's going on? Is Mr. Spector the only one who knows what's going on?

This government has a very sad record when it comes to educating professionals in this province. I guess we can import professionals. We can even import a government from Ontario. All of the experts from Ontario, and, in fact, even the cabinet, no longer really have a great deal of power. They're just as much rubber stamps as our back-benchers who stand up and vote in the House, whether they speak for or against a particular motion.

I recall budget speeches that I've listened to since before I was ever elected, and I can remember Premier W.A.C. Bennett getting in the news reports and on TV clips talking about creating 26,000 new jobs in the past year and 40,000 new jobs in another year. Through the NDP government and those early Social Credit governments, jobs.... Mr. Speaker, in this province today, there's not a mention from the Minister of Finance about record unemployment or about the fact that we have eliminated 7,000 jobs from the public service.

Interjection.

MR. NICOLSON: Isn't 7,000 the figure you're using right now?

Interjection.

MR. NICOLSON: It will be.

We have eliminated 63,000 jobs in British Columbia. We're not downsizing government; we're downsizing British Columbia. A 15.2 percent unemployment rate in British Columbia for January is higher even than Prince Edward Island, Nova Scotia or Quebec. That is the record of this government. Anybody can govern in good times. It's what you do in the tough times that counts, and in these tough times you're not doing enough.

I suppose the government members could be replaced. We could have automatic computerized voting. All you'd have to do is get your friend, Mr. Goldfarb, to make all the decisions for you, without having to go through the inconvenience of an open and free debate in the Legislature. People could just vote on any particular issue, because that's about what's happening right now. There was a big rush to have that recent Goldfarb poll finished at the very beginning of last month, and then, of course, you came out from that with that marvellous little innovation, the 8 percent surcharge, supposedly for the removal of hospital and other user fees.

If we look at this budget we'll see one part of it that's increased, and that's the budget for paid consultants — so-called professional services. That's up. Get rid of people who are independent public servants and hire more people who can be fired immediately, with no muss, fuss or bother, if they dare to question any decision and offer any experience or informed advice. This government has increased the maximum consulting contract which can be entered into without Treasury Board approval. That's one of the things it's increased. Now, without going to Treasury Board, a cabinet minister can hire somebody on a contract up to $50,000, whereas before he was limited to $25,000. That doesn't sound like downsizing to me.

But of course it's a pretty selective kind of downsizing that's going on. You downsize people on welfare. They now get, what? Five dollars a day? That must look after food, clothing, bus fares. I don't know if there are too many Third World countries where people would have to provide for some of the necessities you have to provide for in a country in which climate is a very extreme factor.... From what I have seen of people in Third World countries, they might be more able to get along than our poor can get along on $5 a day.

[4:00]

The government has been parachuting people into certain positions. I know of one former civil servant who was supposedly let go and now is getting $290 a day to go through a few files in the Ministry of Lands, Parks and Housing. The work is normally done by a clerk 5 who gets about $80 a day. Why is that taking place, Mr. Speaker? Does that individual have something on this government? How does that come about? That's not downsizing.

As I said earlier, the youth unemployment rate is now at 24.2 percent. Almost one young person in four is unemployed in this province. That is a war against prosperity, and the troops being sacrificed — the cannon-fodder in this war — are our youth, as it is always our youth. That, I think, is absolutely unforgivable and lamentable.

[ Page 3403 ]

The budget provides for the removal of user fees. What is in dispute between the federal and provincial governments is something like $30 million or $33 million. What is actually raised by hospital user fees in a year in this province is about $40 million. The 8 percent surcharge is estimated to raise $166 million a year. I say that that is an absolute sham. It is absolutely unacceptable. I think that the people of this province are going to see through that. If the government wanted to meet force with force.... Certainly there's been some sabre-rattling on both sides in this issue. We're not opposed to removal of user fees, but a 3 percent surcharge would be absolutely all that's needed to accomplish the very same end. We know that when that money goes into consolidated revenue it can be spent for anything. It can be spent for northeast coal as easily as it can be spent for hospitals. We know that it will go into that fund, and that fund will be deposited into the general fund, which is the law of this land.

I note that the minister said in his speech: "We may be forced to undergo another painful recession without ever having fully recovered from the last one." In 1982 I made the prediction in this House, to the scorn and derision of some of the cabinet benches, that our economic difficulties could last until 1986. It is another prediction which I made by listening to people much more informed than myself, and something that this closed government has failed to recognize. Now, almost too late, it is recognized. When I made those predictions, government was still spending money very wilfully.

Mr. Speaker, I find it incredible that the government has brought back provincial government exams, which, as a person who used to teach science and mathematics, I am not totally against. They brought them back, though, with the idea that we would give all students an equal chance to enter university; they would be graded on the same criteria. At the same time, less than 7 percent of rural students will have the opportunity to enter university. So we've introduced this very expensive device in order to create some fairness for an ever diminishing group of people. There is a total lack of accessibility to universities. We stand probably the worst in the country in every conceivable indicator that you can look at for measuring post-secondary or even K-to- 12 education. There is no need to downsize an education system on which we spend less of our gross provincial product, less per capita, than any other province in Canada.

Mr. Speaker, this is a budget that I cannot accept. This is a budget that is not in the best interests of British Columbia and that should be rejected. There is still time. We aren't even into the next fiscal year. It should be taken back to the drawing board, and there should be total input from the public. We should get on with governing this province instead of punishing it.

MR. KEMPF: Mr. Speaker, as always, it is indeed a pleasure for me to stand in my place and once again speak in the budget debate on behalf of the people I represent in this chamber — the people of Omineca. So far in this budget debate we've had a far-reaching and involved number of debates, debates which have ranged beyond the borders of British Columbia and Canada, and in fact across most of this world as I listened to members on both sides of the House voice their views. My remarks will be more local, and they'll not be lengthy.

At the outset I wish to say that I will be supporting this budget, but not unlike my seatmate, the member for North Vancouver–Seymour (Mr. Davis), I have some concerns as well. I will voice some of those concerns in the next few minutes. I have concerns particularly as a rural and north central representative in this chamber. I represent a riding which provides more than its share of the dollars that go into the provincial coffers of the province of British Columbia, and little by little it's an area of this province that is getting less and less in the form of returned revenue.

If anything, I can call this the good news, bad news address. First, the good news. This budget indicates two very important things to the people whom I represent: (1) the restraint program is working; (2) it is working well, and the very serious financial situation that we and other jurisdictions in the world are in is becoming a lessening problem. The restraint program is working, and it continues in a very real way down a path long forgotten by governments in, I think I can say, all other jurisdictions: that is, the path of reducing bureaucracy and not allowing it to increase unchecked to a point where our taxpaying citizens can no longer afford the bill.

Mr. Speaker, the downsizing of government in this province was long overdue. I think that if you will read Hansard for the last eight years you'll find that that's what I was saying in some of the addresses that I've given in this chamber as far back as 1977. The downsizing of government was long overdue, it's continuing in this budget and it's not yet complete. I respect the government for taking that firm direction in respect to a very real problem for those who pay the taxes in British Columbia. Reducing the size of government is the only way to reduce the cost of government. I must commend the government for holding firmly to our course of creating a smaller government in this province, and in so doing, creating greater productivity in a smaller civil service.

The budget speaks of a yet greater role for the private sector in the affairs of British Columbia. That, too, I most heartily support. It was individual initiative and hard work which brought this great province to what it is today, and it is initiative and hard work that will keep it on that very sound foundation.

For a number of years we have leaned toward the mentality which suggested that government could do it better and, of all things, cheaper. That's not so at all. I think that's been proven not only in this jurisdiction but also in many other jurisdictions of the world. I think you only have to look at some of our own dismal failures to understand that, and certainly the dismal failures of other jurisdictions, too numerous to list here today. We've got a long way to go yet in the area of privatization in order to undo the wrongs that have been done in the past to the taxpayers of this province. I could name a great number of Crown corporations — and I've heard others name some in this chamber just this afternoon — and government departments which could and should be turned back to the private sector.

Interjection.

MR. KEMPF: I will name many, Mr. Member for North Island (Mr. Gabelmann), and you'll even agree with me on some.

Mr. Speaker, it is for those reasons that I support this budget. That's the good news; now for the bad.

As a rural and northern member of this assembly, I believe that it's incumbent upon me, in light of the government's second restraint budget — which, again I say, we in the north philosophically agree with.... It's not only

[ Page 3404 ]

incumbent upon me, Mr. Speaker, but I would be derelict in my duty to my constituents not to speak of those areas of this budget which I think to be a problem for the rural and northern part of British Columbia. I would be derelict in my duty not to voice my concern for the direction in which some of the restraint moves are taking us.

[4:15]

In this budget we are paying off a $471 million historic debt of the British Columbia Railway. On the surface that's not all bad. I would most certainly agree that in so doing we give the board of directors of that Crown corporation a new lease on life — the initiative in having that heavy burden lifted from their shoulders, to get on and improve upon the very commendable job they have done in the past three or four years. I would do as well to agree with that move on the basis of a report tabled in this Legislature on April 7, 1982, which made that recommendation as well as many other valid recommendations in regard to that Crown corporation.

Having said that, Mr. Speaker, I must ask — through you, through this assembly and through the government, which has taken action to eliminate this debt — when they, as a railroad, are going to live up to a commitment made when laying the track in my constituency, to and beyond the community of Fort St. James, and assume the responsibility to the people along that track north of Fort St. James, the people of Tachic, Leo Creek and Takla Landing, for upgrading that stretch of track, in order that two things take place. One is resumption of logging operations in an area which is badly in need of employment and, I might add, badly in need of logging, for many reasons. It's an area that has been ignored by those presently holding the cutting rights along that stretch of track, because they say there's a lack of transportation facilities. If that's not true, I would call upon the Minister of Forests (Hon. Mr. Waterland) to make the necessary changes to ensure that that logging continues. Number two, so the people of that area — who are totally cut off from the outside world, who became totally reliant on the British Columbia Railway because of the commitment made by that railroad when the line was built — can once again enjoy something we take for granted, fresh groceries at least twice a week, and a transportation facility to the outside world.

We hear an awful lot said in this chamber about ALRT and multimillion-dollar bridge projects across the lower Fraser River. I support those kinds of projects because they're needed. I've supported those kinds of projects when speaking in my own north-central constituency. I support those projects because they too are needed. As a northerner, I'm not oblivious of the problems of others. But when I see a situation — and I've fought this situation for the eight years I've sat in this chamber — of a Crown corporation now being bailed out in this budget, to the tune of $470 million, I look for that Crown corporation to live up to its commitment. When I look at the way that that Crown corporation has shirked its responsibility over the years to those of my constituents who live along that railroad, I really begin to wonder.

Another concern that I see in this budget, as a northern representative — and while on the subject of the BCR — is the total disappearance of the airport assistance program, a program that was not very large but was of the utmost importance to those of us in the north. For those who don't know, the airport assistance program was initiated by my colleague, my seatmate, the member for North Vancouver–Seymour (Mr. Davis), in response to a concern voiced by me and others when construction of the Dease Lake extension of the BCR was cancelled. It was a way in which some compensation could be paid to the north in a very logical way for the loss of that very large project, a project which — and rightly so — was deemed unnecessary. But little by little that program has been whittled away until today, here in this budget, it has completely disappeared. As a northerner that concerns me and my constituents.

I have other concerns related to transportation in regard to this budget. Certainly I fully realize, as do my constituents, that in times of restraint we all have to tighten our belts. I also understand that acceptable levels of service must be maintained in the three main areas in this budget: health, human resources and education. But in the north, highways and roads are lifelines and are not extravagances, are not programs which can be cut. I see in this budget that the dollars for highways construction and development are down drastically. Mr. Speaker, although I don't know now — and only time will tell — how this will eventually affect the north, I'm sure we'll find out in the days ahead. I'm concerned that they will impact, as other cutbacks have, on the northern part of this province.

[Mr. Strachan in the chair.]

I would respect that if the reasons for not being able to provide the dollars necessary for very vital projects related to highways in my constituency were in fact evened out throughout the province. But I suspect that it is the north again that will take the short end of the stick. I would today caution the government — even though we are solidly behind the restraint program....

Interjection.

MR. KEMPF: You laugh, Mr. Member for New Westminster (Mr. Cocke), but it's a very serious concern to the people in the northern half of this province.

I would caution the government to watch very closely how restraint is attained in British Columbia. We in the rural areas of this province get precious little enough in good times, let alone bad, and we will not stand idly by and watch what we have worked hard to obtain taken away in bad times and given, as we have always seen, to the south.

I have touched on only a few areas where my concerns lie in regard to this budget. I will revisit some of these areas, and touch on many others which I fully intend to address during future debate in this chamber, particularly on individual ministers' estimates. I will touch on the very serious matter of reforestation in the north-central part of British Columbia. I will touch upon the monumental problem faced by a number of my constituents, and others in the north, in the agricultural industry, regarding Crown land plans and the way they are being crammed down the throats of those in the agricultural industry. I'll speak, as did the member for Nelson-Creston (Mr. Nicolson), about the serious lack of conservation officers in the field, and what effect that is having on our northern wildlife reserves. I will voice concern as well for the erosion of the very meagre services that we already enjoy in the north, which in good times didn't come anywhere near reaching the level of those enjoyed in the southern part of this province.

[4:30]

I will be touching as well on the need for moving some ministry offices, moves which I don't regard as restraint but

[ Page 3405 ]

which are being made under the guise of restraint. I would suspect, and in fact I have evidence to prove, that some of these moves are due to the high lease rates being charged by the British Columbia Buildings Corporation to the ministries utilizing that space. If there is any bureaucracy in this government that we should be getting rid of, it's that Crown corporation.

We in the north are sick and tired of always being the fall guy. We understand the need, during these times, for restraint — because we've always practised it, whether in good times or bad, in the area that I represent. But we will no longer, in the name of restraint or anything else, see our position eroded while all of those scarce dollars are spent in the lower mainland of this province. We will not stand idly by and see that. We are proud British Columbians, probably more so than anyone else in this province, but we expect a return of our fair share of the pie, however small that pie may be.

Mr. Speaker, as I said previously, because I believe philosophically in this restraint budget, as do the majority of my constituents, I'll vote for it; but I fully intend in the weeks ahead to voice these and other concerns of northerners about the inequities of this particular budget.

MR. ROSE: Mr. Speaker, that's certainly going to be a tough act to follow. If you consider how severely the government is hurting their friends, especially those up north in Omineca, you wonder how much they're prepared to hurt their enemies.

I would suggest that the government has embarked on a kind of economic evangelism, a kind of economic born-again fundamentalism. As a matter of fact, they remind me more of Ayatollah Khomeini than any thing else I can think of, because they've got this sect of true believers. That's one of the dangerous things about them, you know. They're the kind of people who would probably put themselves into a bomb-laden truck and drive it into the American embassy. They're true believers. No matter what happens, they're going to be right. So they're not concerned about anything like that. They're the kind who feel that being in debt is a sin. It's obscene. However, unemployment is really not so serious after all, especially if you have a job. It doesn't even get a mention in the budget speech. Not a mention, and I'm really sorry about that.

They hurt their friends in other ways too. There's a line in the budget speech that has to do with the boasting by the minister.... First of all, the Socred friends from Red China will be here, so that's going to guarantee success. They're boasting that this big venture, Expo 86 — which the member for Omineca (Mr. Kempf) would like to have in Grassy Plains or someplace like that — is going to create 60,000 person-years as employment. I think that's fine. I believe in certain projects to create employment. I don't think anybody in this party has ever been opposed to employment-creating projects. But I'll tell you one thing: if you can have positive spinoffs, you can also have negative ones. If you get rid of 10,000 public servants and 4,000 school teachers, plus assorted numbers of aides and all the rest of it, then according to the negative multiplier effect that operated in Qualicum you've probably got a negative multiplier of 21,000 more jobs, for a total of 35,000. So all you've done by creating Expo 86 is create double the number of jobs that you've lost through your policies. And those people....

HON. MR. CURTIS: You don't want Expo to happen?

MR. ROSE: I didn't say that. What I'm saying is that you can't boast that you're creating 60,000 jobs and ignore that you've uncreated or abolished 35,000. If you want to hear the plus side, you also have to be prepared to hear the negative side. The negative multiplier.

AN HON. MEMBER: Subtract the negative from the positive, and you end up with a positive.

MR. ROSE: Yes, and you're still way down in terms of unemployment. You probably lead the rest of Canada. So much for your success on that.

What concerns me more than anything else is the fact that as a party, Social Credit started in the Depression, like the CCF and the NDP, because they protested the kind of economic policies or economic order of the time that was pauperizing people, taking their homes and throwing them out of work. However, within 30 years after he became a senator the champion Socred of them all, Premier Manning, became a member of the board of directors of the Royal Bank. That's how they've lost their roots. Their roots are gone. What they are, really, is a neo-conservative party — the same thing the Socreds professed to replace in the thirties. They're gone. They believe now only in property. They don't believe in people. They're prepared to give all the money and tax benefits they can to property holders. Giveaways, hoping to get certain kinds of support....

When you look at it, the minister over there shouldn't get a gold star for his budget; he should get the golden loophole award. It's not that there shouldn' t be incentives. I think there certainly should be incentives in terms of creating jobs. But that isn't what happened with the federal experience. The federal experience has been that when you give incentives for governments to produce more work at times of recession, they don't produce more work at all. What they do is spend their money on corporate mergers, which have doubled over the last ten years — that's what they do with their profits — or spend it abroad. From 1960 to 1982 investment abroad has gone from $132 million per year to $3 billion a year. That's what happens. We're not opposed to that. This party believes that if you're going to give money to corporations, you should get equity or at least tie them to some kind of a deal so that when they get the money, they create the jobs — not get the money and then invest it somewhere else abroad. That's exactly what has happened to the investment incentives of the federal government — not just millions of dollars but billions of dollars.

So what we're concerned about is that the strategy of the government is to turn the province into a province of peons. They want to destroy the kinds of structures that we have. They want to back out of the social contract and turn it into a province of peons. War on poverty — take dead aim at the poor. That's what this budget did. It took dead aim at the poor and the people who are unemployed and the people who are on welfare.

I don't know if the lobbyist from the independent schools is still up in the gallery, but I want to reassure him that I don't intend to talk very much about education today — certainly not elementary and secondary education. So if he had to go somewhere, he is free to leave. He is excused. I'm not going to say anything good about them or bad about them today or talk very much about education, even though it is my critic area, because I feel that I've had an opportunity, and will again, to deal with that subject. I had an opportunity two

[ Page 3406 ]

weeks ago in the estimates and again last week in the throne speech debate. I've spoken at length about the cuts in education. I don't know whether it bears repeating here but I would suggest to you that when the minister tells us that he has some small cuts to give the various educational institutions, he really ignores the inflation factor. If school budgets are going to be down 2 percent, that doesn't sound like very much. But if you have an inflation of 6 percent in the same year, that's an 8 percent cut. If you multiply that by three years and allow them no raises, you've cut the public schools by 25 percent. If you cut the colleges, as you have this year, by 3.5 percent and you add that to the inflation factor, you've cut the colleges 9.5 percent. If you cut the universities by 5 percent in one year, you've really cut them by 11 percent. Those are pretty savage cuts in educational spending. I don't know how you justify it, especially on every major count. Whether you're talking about percentage of provincial budgets, percentage of the GNP, percentage of personal income, or whatever you want to do, B.C. ranks dead last in its investment in education. At a time when 25 percent of our young people are out of work, we're dead last among all the provinces. In post-secondary education we're dead last with one exception — Prince Edward Island. I don't know how you can defend that kind of thing. But we're apparently still going to proceed with this kind of hatchet job, led by the Minister of Universities, Science and Communications (Hon. Mr. McGeer) or the Minister of Education (Hon. Mr. Heinrich), who will henceforth be known as Jack the Ripper, because we have headed right into a tremendous battle for educational survival — certainly the quality of education. I am particularly concerned about it.

In addition to that, we've diverted funds that have come from the federal government away from post-secondary education — away from the universities. I have it reliably reported that our funding from the federal government under the EPF grants is up 8 percent this year. What did the Minister of Finance do? He cut the universities by 5 percent and said they were lucky; they should have been cut by 6 percent. Universities now are 70 percent funded, in terms of their operating costs, by the federal government. What's the province doing? Where it is taking that money? What is it spending it on? Where does it go? Where does the 30 percent go? If 70 percent of the operating costs are funded by the feds and 10 percent by the students, that only leaves 20 percent by the provinces. I don't weep any real tears for them when they cry about medicare.

[4:45]

Beyond the funding, I was talking to a university professor today, and he said the morale is terrible out there because they don't know where it's going to hit next. They're not very happy about things. They're concerned about declining enrolment. I know some people are going to say: "Why should you worry about them? They're fat cats. Why should we worry about those fat cats? They've had it terrific for years." To some extent they have been a protected group in society, and I don't think anybody will deny that. But we can't say that we have overspent and overbuilt on education, especially when we have been diverting funds — last year, $84 million — away from the colleges. There is a lot of uncertainty and it's bad morale.

Another thing that has happened in the colleges is that instead of making them community colleges, they have tried to turn them into job-creation centres. Manpower-planning models is what they are after. They are suggesting to themselves, I think — or trying to kid themselves — that this is going to be the better future direction. A lot of people will question that. The manpower model has not worked out, because it's virtually impossible to predict the kinds of skills we're going to need 15 and 20 years down the road. The skill-specific training, which has been imposed on the colleges by the minister, I think, is at a dead end. We don't need an anachronism — skill-specific training — but we need to equip our students with broad general skills so that they can adapt and be flexible.

What is the future? The future is the marriage between telecommunications and the computer. This is what is going to happen in the world as we see it coming and unfolding. Any of you who feel that computer jobs or high-tech jobs are going to be tremendous employment stimulants are going to be disappointed. The whole computer industry in the United States — and it's reached a tremendously complex and sophisticated level there — has created fewer than one million jobs. The jobs that are occurring in our society are at both ends of the scale, and the middle is disappearing. The union jobs, the decent jobs and the high-paying manufacturing jobs are disappearing. They are being replaced by automated equipment where the clerical, the service work and the low-paying jobs — such as the fast-food places — are where the employment opportunities are, but they're all poor jobs. I think the minister's policy is dead wrong. They are embarking on narrow, occupational training and ignoring the fact that the new illiteracy will be computer illiteracy. It won't be verbal illiteracy; it will be computer illiteracy. We are letting our young people down.

Another thing is the funding. The colleges don't know what their funding is going to be. They were told they were going to be cut, but they don't know what funds each one of them is able to anticipate. Therefore they can't plan. The funding formula of the kind that we tried has been tried in Ontario and found wanting. It seems to me that virtually every direction in which the ministry of Education seems to be going is in reverse of where it should be. Community colleges should be there to serve the needs of their own communities and not, in my view, become an arm of government.

In addition to the problems that I've just outlined, there is the problem of accessibility. We're now being told that students going on for post-secondary education won't be able to get any grants. The provincial government will not support them in terms of their grants anymore. Two years ago we spent $21 million in the province on a mixture of loans and grants. The grant portion was cut to $14 million this year, and in this next budget it is going to be cut to zero. That means that many students will not be able receive a university education. It will be reserved for those people who live in Point Grey, can live at home and can go out and back to school every day. It won't be for the kids from Prince George, because their costs are going to be at least $2,000 or $3,000 a year higher than those affluent members from West Point Grey. That is a situation that is unacceptable in a society that is supposed to be committed to equal opportunities. So the grants are gone and the funding is going to be cut — and it can be cut. Dr. Pedersen of UBC said in a speech recently:

"Certainly we can reduce services, eliminate programs and refuse to admit students because of budgetary constraints. We can be tough-minded and efficiency conscious. We can do many of the things that

[ Page 3407 ]

appear to be fashionable at the moment. However, the problem is this: if we do such things, are we really serving the public interest? It's true that we can at least in the short term increase our political capital by making dramatic cutbacks. But is this the right thing to do when we know that some of the programs we will eliminate will be of fundamental importance to our economic survival in the near future? It seems to me that this is the critical question."

So this is the question that Dr. Pedersen of UBC asks us, and I think it behooves us to think about that just a little bit.

Mr. Speaker, I'll leave the educational side of it now, because I want to talk about what the minister had to say about medicare. I think the minister called the federal government's behaviour on the medicare issue "mischievous." He described the federal government's activities and posture as mischievous. I'd like to give you a little history of medicare as I know it in this country, First, we know where it started; I won't go through that again. We found that one of the poorest have-not provinces in Canada, namely Saskatchewan, was able to make it go, when the rich provinces weren't able to. Finally they embarrassed the rest of the provinces into doing just that — ultimately the federal government and later the rest of the provinces; B.C. was second. I think the previous Premier deserves great credit for being alive to the political reality of what that meant if he didn't get into it.

The Minister of Finance spent a good deal of time dumping all over the federal government for medicare funds which were supposedly held back. There's no question that medicare funds were reduced; no one's questioning that. If we go back to when this started, we would find that the health act required a dollar-for-dollar province-fed commitment. For every dollar given to the provinces, they must have spent a dollar, and what's more they had to account for this. That was in 1977. There was really no check on that in terms of the amount: any amount could be spent. The provinces, because they were getting really cheap dollars — 50-cent dollars — spent lots of money on medicare, as did this province. There's no question about that.

Then they felt that they really didn't want to have to account for every dollar they spent. They said: "Why should we have to account to the federal government in a field that is really ours constitutionally?" After a lot of palaver and a lot of conferences we got EPF, the established programs financing act. No longer did the provinces have to be accountable for the money they spent, and everybody was happy. The Social Credit government supported that move; so did nearly all the provinces; so did both the Liberal and Conservative Parties. The NDP didn't, because they were afraid that the poor provinces would divert funds from medicare into other provincial priorities, ending up charging user fees, which would threaten the whole system. It didn't happen that way. The poor provinces didn't do it, but the rich provinces did: Ontario, Alberta and British Columbia raised their user fees. When that happened, along about the same time, in 1972, the feds capped the money that they would spend. Why did they cap it? Because every time they did anything, they were dumped all over by the provinces that had all the surpluses, and the feds had all the debts at that time. The rich provinces were charging — as I just said — and the poor provinces weren't. As we know, some provinces were spending money on roads. Anyway, that's what we had, and that's why we got to this point. The feds then started cutting back, and that's what the minister is unhappy about. The feds started cutting back on their EPE Sensing a hot political issue, Monique Begin decided that if they carried on with that, she'd cut off their funding even more under the health act.

I quote from a paper by Bill Blaikie, MP, who talks about this. He says it perhaps better than I could, and more quickly:

"The removal of this money in April of '82 was at first glance a clever move."

He means, by the federal government.

"Most provinces had argued that the money attributable to compensation for the termination of revenue guarantees was not earmarked at all and that it was unfair for the federal government to regard it as such. Indeed, many provinces had argued that up to half of the EPF funds were not earmarked — that is, money transferred via tax point transfers. So when the tables were turned on the provinces in the fall of '81, their own arguments were used against them to claim that health care funds as such were not being cut. One could hardly resist the temptation to conclude that the provinces had got what they deserved. Sophistry abounded. To know who played sophist first, one would have to be at the table in 1977 when the deal was first struck."

There's a little bit of the history of what happened.

I wonder what the minister wants to do now. He doesn't like what the feds are doing. He wants more money. I think he deserves more money from the feds. But would he like to destroy all the EPF funding and the block funding, the non-tied funding, going back to dollar-for-dollar accountability? I'll bet he wouldn't. If he did that, it would mean he couldn't divert $84 million a year from university or post-secondary funding. He'd have to make certain that he spent all the money he had, without user fees on medicare. That's what I think will happen.

I don't know what the answer is to the medicare funding. You talk about overutilization. Who is it by — patients or doctors? Do we need a new model for medicare? Should we have a model that stresses prevention and lifestyle? Do we need paramedics? We have people who are overqualified for doing a lot of medical things. I think we should do it. One of the big problems is that most right-wingers don't really like medicare. They like the entrepreneurial style of medicare where the physician has a stethoscope in one hand and a cash register in the other. That is what I think they want to preserve. Consequently, I don't think that we are going to move into alternative models unless we are forced into it by financing. I could give you another long quotation, Mr. Speaker, but I will spare you. I do want you to know that although the present Minister of Finance was once a well-known — and probably still is, federally — Conservative, both the NDP and the Conservatives, perhaps forced into it, have come out four-square for the new national health act which forbids deterrent fees.

About the question of taxes. Questions have been brought up about how we can pay if we haven't got enough money. A lot of people are a little concerned about the taxes that have been added to pay for certain extra costs or missing funds. I am not particularly concerned about that, provided the taxes are based progressively on ability to pay and don't stop at say $20,000 a year, but the 8 percent tax goes right up the incomes of $20,000, $30,000, $40,000, $50,000 and S60,000 and is not capped so that the poor pay more than their proportional share. For those people who don't pay taxes,

[ Page 3408 ]

they can't afford it anyway, but they will still get this system. If we let our medicare system erode, we are going to have a two-tiered system, because those people who can afford it will require supplementary private insurance to cover what medicare doesn't. Once we have done that, we have let the private insurance companies back into the health industry, and we will have more of the same — we will be right back where we were 15 years ago. Nobody wants to go there, least of all me.

[5:00]

One brief remark about the Eagle Ridge Hospital in my riding. We are very disappointed that we are not going to have our emergency ward system. We are very disappointed that we are going to be part of another board, the Royal Columbian. We'd like to know: when they turn the key over on April 7, who will get the key? Who is going to be the new owner? Will it be the rightful owners, the people who organized and lobbied for and worked for the hospital in the first place, or will it be somebody else? We recognize the need to rationalize. We recognize the need to save money on health care, but we also recognize that the medicine and hospital industry is full of competition and jealousy, and we are afraid that our community lost out on a very important thing when it had a complete medical and emergency ward there and now has not been allowed to open it. We regret that, and we protest it.

Since this is the year 1984, and George Orwell had a particularly interesting little fable called Animal Farm, I thought I would write my own little fable called "The Same Old Gang Ranch." It goes something like this.

Once upon a time there was a wealthy rancher who owned thousands of acres of land. The farm was inherited from the farmer's father and contained vast amounts of timber, coal and cattle and produced billions of dollars of produce each year. It even had its own factories where many things needed on the farm were produced. Why, the farm was so big it employed hundreds of hired hands who lived on their farms with their families in houses that were, while not as nice as the farmer's house, which was a mansion, still good enough. While the mothers tended the young children or worked outside the home, the fathers tilled the soil, cut the trees, herded the cattle or worked in the mines or on the many roads that were built to service the activities and enterprises which took place on the ranch.

This was a happy place. The grownups all had jobs. They were well-housed and well-fed. The children went to school during the day and frolicked on the playgrounds after school or practised painting or played music if they liked.

Most everyone on the Same Old Gang Ranch liked the owner — I'll call him Ezra — although they liked his father better. When times were good their places were kept in great shape. There were hampers at Christmas time, and each spring the hundreds who worked around the spread were invited to a huge garden party where they disported themselves on the lawn to gossip and to drink tea and nibble cake and cute little cookies which the owner provided free.

Things went on like this for over thirty years during the tenure of Wacko the father, and Ezra the son continued the tradition. Unfortunately Ezra had one fatal flaw: he liked to gamble. In fact, as time went on, he became a compulsive gambler and eventually fell among some very fast company. He fell in with some high-rollers from nearby ranches and some from across the ocean as well. These high-rollers talked Ezra into more and more schemes, like $600 million railways to remote corners of the Same Old Gang Ranch to dig for and ship coal, while at the same time there was lots of coal already available in the southeast comer of the ranch. Poor naive Ezra was gradually talked into taking bigger and bigger gambles, and all the while markets for what his ranch produced, like coal, timber and cattle, continued to plummet. Because of these squanderings and extravagances, Ezra had to borrow each year to pay for the operation of the farm, and to borrow and borrow until the ranch, which was once a clear-title outfit, owed some $14 billion to his own farmhands as well as to the foreign high-rollers and bagmen.

What was poor Ezra to do? He was cornered. Finally he called in his tenants and workers and told them that if they would only give him another chance he would mend his ways, pay his bills and stop gambling with their money. That's what he promised. And so they believed Ezra and gave him another chance. What's more, instead of turfing Ezra and the Same Old Gang management out, as some of the sharecroppers had wanted them to do, about half the farmhands voted to give him another chance because they were convinced by what they read in Ezra's newspapers and heard on his radio station: that is, the Same Old Gang management were more efficient managers than any of the sharecroppers could ever be. Ezra's radios and newspapers, you see, claimed over and over, day after day that the sharecroppers couldn't even run a push-cart, let alone a ranch.

As soon as Ezra and his gang were back in charge, though, things began to change rapidly and radically. Some say the changes happened because a spell had been cast on Ezra by a wicked sorcerer while visiting Okanagan Lake in the summer of '83. Others said it was because Ezra had absorbed too much sun during the same visit. The sunstroke point, though, was ridiculed by those who assured one and all that Ezra would never be susceptible to sunstroke since, as everyone knew, he had spent countless hours basking and luxuriating in the tropical sun over many years and so had built up an immunity to sunstroke. However, a more sinister reason was advanced for Ezra's rather sudden concern for deficits and debt. It was said by some that the same mob who had advanced him the money had begun to apply extreme pressure on him to start paying back the $14 billion he owed them. "Either pay up or we'll raise your interest rates." Or worse, it was claimed by some: "Pay up or we'll break your kneecaps." Regardless of the reasons, Ezra suddenly became totally preoccupied with debt, and so he should have been, since he created most of it himself by foolish stunts like building dams when they weren't needed.

At first people were exhorted to work harder, to produce more and more, and more cheaply. They tried to do this, but no matter how they sweated to cut down more trees or dig out more coal, nobody wanted to buy the lumber or the coal. Cowboys were told to train their ponies to eat less hay. They did this enthusiastically, giving the ponies less each day. Unfortunately, when they were almost trained to go without food, they all up and died. Following that, each person living on the farm was charged more and more for everything he needed: food, transportation, insurance. But at the same time they were ordered by Ezra not to ask for more wages, since Ezra sternly reminded them: "You can't spend your way out of debt."

Finally Ezra and the Same Old Gang management team decided to save money by firing about one-quarter of the workers who worked on the farm. He sold the playgrounds, he closed down the classrooms, he fired the music teacher,

[ Page 3409 ]

and the children no longer laughed and played. He let his buildings run down, so more carpenters were unemployed and couldn't buy things from the company store. He did this all in the name of restraint. But he didn't stop with firing the farmhands, whom he moved into dilapidated shacks hidden from sight behind some bushes on the back forty. He became so desperate he began selling off parts of the farm operation at cut-rate prices to his friends on neighbouring ranches. He sold some of his best farmland. He sold his publications. He sold off his bus company, which transported the hands to and from work. Privatizing, it was called — to get the government off the backs of the people, he told them.

But he didn't pay off his debts. First Ezra's gang, using the same old shell game technique, shuffled the debt from one pocket to another. Next, and worse, Ezra and his pal Big Slim Curtis began shifting the debt from the ranch to the farmhands, until each man, woman and child owed the mob some $5,400. So, verily, more of the ranch was offered for sale this year, just to pay the taxes. It was feared that Ezra and the farm would wind up one day with no debt, but no ranch would be left either, because everything had been sold. Sadly, the people were no longer happy, and they cried and cried that most of them were worse off than before they gave Ezra another chance. The gang management, though, told them not to be downhearted. "Don't listen to those doom-and-gloom sharecroppers, " they said across the way, "those lazy burns living in those shacks on the back forty. Pay no attention to those peasants who argue that the same automation which will guarantee rising productivity will lower wages, and also guarantee rising destitution. Heed not those sharecroppers who want short work weeks, lower bank interest rates, earlier retirement and fair distribution of jobs and income as a solution to the ranch's problems.

"Be of good cheer," said the gang. "In order to maintain our high standard of living, we must first lower it. We intend to replace high-paying jobs with machines, but don't worry, we'll leave the low-paying jobs alone for a while. To remain competitive, we must cut back on all the safety nets like medical, welfare and education. Wages are the unfortunate cost of production," they said. "What this ranch needs is an efficient economy like Indonesia, Korea or Taiwan, where they do an honest day's work for a decent day's pay, and nobody has to bother about strikes or protest demonstrations. Just follow me and eventually things will work out just fine. But if they don't, it's not the gang management's fault. Blame it on the freeloaders who want to take more out of the ranch than they put into it." And the ranch people listened, but they began to doubt the wisdom of the words they heard.

Well, Mr. Speaker, that is my own little way of saying what I think about the budget. It may be a fable, but so was George Orwell's and so is the budget. With that I would say that I am not going to support the budget.

MRS. JOHNSTON: That's a tough act to follow.

MR. REYNOLDS: Mr. Speaker, I hadn't planned to speak in this debate, but the party Whip came down to my office just a little while ago and said that the member for Coquitlam-Moody (Mr. Rose) was up speaking and that I might like to speak for a couple of minutes after him before the next speaker gets up. It is always a pleasure to listen to the member for Coquitlam-Moody, because he always has some good stories to tell, and I say that very sincerely. I listened to him for close to six years in Ottawa. I must admit, there was never a dull speech. Whether I agreed or disagreed with what he said, he is always a very interesting person to listen to.

Interjection.

MR. REYNOLDS: The member for Comox (Ms. Sanford) says he must be doing something wrong if I enjoyed his speech. I guess one of the nice things in this business is that you can appreciate other people, but you don't necessarily have to appreciate their politics. I think that's something we would all agree with.

I am really up here because I want to congratulate the Minister of Finance. After 31 years it is a pleasure to finally see a provincial budget reduced over the one of the previous year. If we had Ministers of Finance like our Minister of Finance in all provinces across Canada, this country would certainly be in better shape. If we had a Minister of Finance in Ottawa who had the integrity of this government and this Minister of Finance, we'd have a country in much better shape. It is certainly a pleasure to get up and say that in this Legislature, because this Minister of Finance has brought us a very realistic budget.

Last year we were originally talking of a deficit of $1.6 billion, since revised to $1.3 billion, yet this year we're looking at a deficit of only $671 million. Although a few years ago it seemed like a lot of money and it still seems like a lot of money, I think that to go from $1.6 billion down to $671 million shows the fantastic work that all the ministers of this government have done in this province over the past few months. I say "all the ministers" because every one of them, as you know, Mr. Speaker, have taken a cut in this budget over the previous one. I think this should be an example for all other ministries and governments across this country to look at their departments and see where they can cut back in a responsible way. I congratulate all of those ministers, and I congratulate the government itself.

In studying the budget I see that the Health ministry has an increase. It is certainly one of the most important departments of government, because it affects people most when they're sick. We're looking after our responsibilities there, but I would suggest that that minister is still working hard. Taking into account that the incomes of the medical profession are 25 percent higher than the average in Canada, I would suggest that we could still cut down and reduce that department, like all the others.

[5:15]

The member for Coquitlam-Moody talked about the budget being a fable. I have listened to the opposition Finance critic make some complaints about the budget, but I really haven't heard any concrete suggestions as to how the New Democratic Party would run this province other than to socialize everything if they took over. I can't help but wonder when I see the Minister of Finance announce the extraordinary payment of $470 million to the British Columbia Railway to eliminate that historic debt burden, and yet I hear some of their people talk about how that's a terrible thing to do. Their Finance critic criticized that and said instead of being earmarked for B.C. Rail the $470 million should be put to use in other areas — for the unemployed and to increase consumer spending. It's interesting that he would say that and that other members of his party would chastise this government for making that payment. In her public accounts reports, the auditor-general stated very clearly that this railway debt is a historic debt service created not only by this government but

[ Page 3410 ]

by the previous NDP government also. In fact some of the largest increases in that debt were created by the NDP when they were in power.

He talks about the interest charges alone — the debt service charges between March 31, 1983, and March 31, 1987, are estimated at $87.1 million the first year, $86.4 million the next, $86.4 million the following year and up to $85.6 million each year. I commend the government for paying off that debt and putting the railway back on a sound footing. I would also suggest that some of the members of the New Democratic Party go back and read the report of the select standing committee on Crown corporations of April 20, 1982, when they reported on the inquiry into the British Columbia Railway. Members of the New Democratic Party to my right were sitting on that committee. The member for Skeena (Mr. Howard) was on that committee — a member who everybody hears every day in this House; the member for Burnaby North (Mrs. Dailly) was on that committee; the member for Nelson-Creston (Mr. Nicolson) was on that committee; the second member for Vancouver East (Mr. Macdonald) was on that committee. That committee realized that the B.C. Rail was in a historical debt situation, and they recommended that the government should assume the railway's net outstanding long-term debt, which stood at $662,809,000 in December 1980.

MR. REID: It sounded like a good idea.

MR. REYNOLDS: It sounded like a good idea then, and all their members on that committee supported it. Now that this government has decided to pay that debt off, no longer is it a good idea. I would suggest that some of those people should look at their ideas.

MR. BLENCOE: Michael Walker doesn't think it's a good idea. He doesn't agree with it.

MR. REYNOLDS: I see the second member for Victoria (Mr. Blencoe) has popped up again. He usually does, and he's saying that Michael Walker doesn't think it's a good idea. Yet in the last parliament, Mr. Speaker, he kept on saying that we did everything that Michael Walker wanted. What the second member for Victoria doesn't understand is that this government is in no one's pocket. We make our own decisions. This government is not in the pocket of labour, like these people from the NDP This government makes decisions with the members of the caucus and not with the labour people leaning inside the door yelling and screaming at us; not with business leaders inside our caucus. We make our own decisions, based on the facts. That's why, at times, we will listen to Michael Walker, because he has some brilliant ideas. But we won't accept all of them. That's why the Minister of Labour (Hon. Mr. McClelland) right now, with his new labour legislation, is consulting with people in labour and other people across this province so that labour legislation.... They may not agree with it, but the Minister of Labour will have consulted with people across this province to bring in some good labour legislation that's badly needed in this province.

MS. SANFORD: He's waiting for Kissinger to bring him some advice.

MR. REYNOLDS: The member for Comox should be in her seat if she is going to be gibing back and forth, but I don't mind her sitting to my left. She says he's waiting for Mr. Kissinger to come and make a speech.

Interjections.

MR. REYNOLDS: I'll correct that. She said he's waiting for Mr. Kissinger to give us advice. I'll tell you, Mr. Speaker, I would love Mr. Kissinger to come and give us advice any time. He's a Nobel Prize winner, a man respected around the world. It's interesting: the same New Democratic Party that chastises some nice people who are trying to raise some money to support some charities by bringing Mr. Kissinger in and says that he should have somebody from Nicaragua standing beside him, giving the other side, didn't tell the people of the province that there was someone making a speech in Nicaragua. Their federal member for New Westminster-Coquitlam (Pauline Hewett) had a meeting speaking about Nicaragua. She didn't invite Henry Kissinger to give his side at that meeting. She didn't even invite me. I would have gladly gone and had a little debate with her on some of those governments in South America.

Interjections.

MR. REYNOLDS: It's amazing how excited these people from the New Democratic Party get because they lost another election. It's amazing how excited they get when our Minister of Finance brings in a great budget which shows restraint.

MR. BLENCOE: Even the business community is laughing at you.

MR. REYNOLDS: The people of this province know, and the second member for Victoria knows that if there was an election this month even he, in Victoria, might have a hard time getting re-elected.

MR. BLENCOE: Come and run against me.

MR. REYNOLDS: Mr. Speaker, the second member for Victoria says: "Come and run against me in Victoria." That wouldn't be a bad idea. The one advantage we would have if I ran against him in Victoria is that we would be rid of at least one member from Victoria.

MR. BLENCOE: Are you going to do it?

MR. REYNOLDS: It's very hard to plan your life four years ahead of time, but you never know when the next election will be. Certainly I'm working with a lot of people in Victoria as their buddy-member and helping them get some things organized, because they're afraid to walk into the second member for Victoria's constituency office because it has so many NDP signs around it. It's got a sign on the door that says: "This office supported by donations from supporters of the NDP....

MR. BLENCOE: Friends.

MR. REYNOLDS: Or "friends of the NDP." There isn't anyone who would walk into that office and think it was a

[ Page 3411 ]

constituency office paid for by the people of British Columbia, rather than just New Democratic Party supporters.

We're having to do a little work here so that some of these people in Victoria who don't feel like walking through the NDP red barricades at the door can get a little assistance in the parliament buildings in Victoria. It's a pleasure to help some of those people. We'll be very pleased to do a lot of the work that he should be doing for his constituents on a non-partisan basis.

I would like to talk a little bit more about some of the positive things this government is doing in this budget and what we're doing in this province. It's a fantastic place to live. We should actually take the second member for Victoria to the city of Vancouver one of these weekends and let him look at that great work that's taking place at Expo 86. If he could just realize the good job.... This government did it against that socialist-dominated council in Vancouver, against the wishes of Mikey Harcourt, Rankin and some of those other people. We said: "We're going to build the stadium here, we're going to put Expo here, and to heck with all your negative comments." Mr. Speaker, if only the council in the city of Victoria would stop being so negative and anti-business they could be progressing like the city of Vancouver.

MR. REID: Good stuff, John! Tell them the truth.

MR. REYNOLDS: They don't like to hear the truth, Mr. Speaker, but it's so much fun to get up and repeat it. If you say it often enough they might really start to realize that if you were positive about things business would increase in Victoria. If you didn't try and scare away every developer who wanted to develop something in Victoria they would be here knocking on the doors. This is the greatest province in Canada to live in and one of the greatest spots.... As the Governor of Washington said, the Pacific Northwest is one of the greatest spots in North America to have a home and to raise your family. But what do we get in this Legislature? Nothing but negative comments from the NDP about what a rotten place it is to live in and how, with free speech, we shouldn't invite people here who want to tell us about their backgrounds and what they think of world affairs.

I'm wondering when one of them is going to get up and really question the fact that the pope is coming to British Columbia. Certainly they don't like the fact that Bill Vander Zalm is on the committee. Isn't that terrible? We have a well-known British Columbian, a Roman Catholic, and why shouldn't he be on that committee to bring the pope to British Columbia? I'm looking forward to the work that he will do in his usual way. I'm sure it will be a first-class organization that the people of British Columbia can be proud of.

I'm also very proud of what we do for education in this province. When I look at the figures of the Minister of Finance and see that we spend $3,437 for every full-time student in our grade and high schools.... I look at figures that are being spent per student in other provinces in Canada and in states in the United States, and I suggest to the NDP that their criticism of our education system is prompted by the very strong union people within the B.C. Teachers' Federation and not by the facts of the matter about the education that's available to our students in this province.

MR. BLENCOE: All of the unions — blame everybody.

MR. REYNOLDS: I don't mind blaming some of the unions, and if the second member for Victoria says that we blame people and start problems and have no solutions.... I would suggest to him, sitting there in his seat, that he really think about that statement. This government has brought forward solutions that are working in this province, and the New Democratic Party has done nothing but complain. The NDP want to talk about all the problems....

MR. BLENCOE: What's the unemployment rate? Tell us what the unemployment rate is.

MR. REYNOLDS: He wants to talk about unemployment, Mr. Speaker. Why doesn't he talk to his friends in the pulp unions and ask them why they're not working today, instead of stopping other people in this province from going to work? They want to stop other people from going to work; they don't want to go to work. Why doesn't he ask his friends in the unions what they're doing on the buses in this province? They're holding everybody up to ransom.

[5:30]

Here comes the Minister of Finance into the House, and I want to let him know that I applaud his budget. I'm glad to see that he's here.

The NDP have a very hard time understanding what is happening in the world today. That's why the NDP across Canada are going to take a licking in the next federal election like they've never had before. In this province they are going to lose, and they'll be lucky if they escape with a couple of seats in the next federal election. If we had an election right now in this province — as I said before — most of these members from the NDP sitting here would not be back in this Legislature. They have not shown the responsibility that they should show as an opposition. They're sitting here still complaining about the fact that they didn't win the last election.

Mr. Speaker, the second member for Victoria is stealing my pen off my desk. The second member for Victoria takes my pen with the British Columbia crest on it that I'm very proud to have in my pocket.

MR. BLENCOE: And how much did it cost the taxpayer?

MR. REYNOLDS: Mr. Speaker, he's asking how much it cost the taxpayer. I don't know how much it cost the taxpayer, but I'd like to ask the second member for Victoria: what did it cost the taxpayer when he mailed this package across the province to aldermen, at a cost of $1.70 an envelope — strictly political — telling them how to win municipal elections. In fact, one member, an alderman in Delta, was so upset he put a motion before Delta council condemning this member for wasting taxpayers' money.

MR. BLENCOE: For $1.10.

MR. REYNOLDS: I didn't say $1.10; I said $1.70.

MR. BLENCOE: How much did the pen cost, John?

MR. REYNOLDS: I'll get back to the pen; don't you worry. Mr. Speaker, $1.70 a package. The second member for Victoria wants to laugh it off, but I suggest to him that his party politics should come out of the party's purse and not that of the people of British Columbia.

[ Page 3412 ]

AN HON. MEMBER: Five thousand packages.

MR. REYNOLDS: Thousands of people ran for alderman in this province. I'd like to know how many of these $1.70 packages this member sent out across this province.

MR. BLENCOE: On a point of order, Mr. Speaker, I would like to point out a correction to the member.

AN HON. MEMBER: Under what rule?

Interjections.

DEPUTY SPEAKER: Order, please. Hon. member, I really don't see that there's a point of order here.

MR. BLENCOE: Indeed there is. The member has made a statement that it was mailed out. I would suggest to that member that it was a request by the alderman from Delta for the information. The request was made by that member. I just make that observation.

DEPUTY SPEAKER: Hon. member, that is really not a point of order.

MR. REYNOLDS: Mr. Speaker, it's nice to see the second member for Victoria get so upset, and I would ask him, as they always do, to table the request in this House so we can read it. If he wants me to, I will read a press release issued in Delta on November 7:

"Your Worship and members of council, I wish to raise a matter which I consider to be of a most serious nature, and one which clearly demonstrates that the NDP is directly involved in the municipal election campaign in Delta.

"Last week, Your Worship, Alderman Moser, an NDP member of Citadel, urged a campaign based on local issues. Yet, Your Worship, I've been mailed, obviously by mistake, a package specifically outlining the NDP's deliberate plans to involve themselves in municipal campaigns right across this province.

"I wish to table correspondence from Mr. Blencoe, the NDP MLA for Victoria, at the conclusion of my remarks.

"The package cost $1.70 for postage alone and was paid for by the taxpayer, through the legislative post office in Victoria, and contained an invitation to forward to the second member for Victoria..." and I quote: "'Send me the names and addresses of your local municipal activists to include in our network.'

"The letter and package stressed the essential aspects and methods of electing the NDP candidates"...in municipal elections. "Clearly, many such packages have been mailed across the province at taxpayers' expense. The Ontario NDP municipal campaign handbook was also included. Also enclosed were NDP-slanted press releases relating to provincial legislation which were to be used to municipal advantage in the upcoming election.

"I take great exception, Your Worship, to this deliberate and well-organized attempt to interfere with politics at the municipal level. I consider it a blatant attempt by the NDP to mislead the people, when they publicly claimed that they have no such intention of becoming directly involved in municipal politics,

"I have forwarded copies to both the Minister of Municipal Affairs and the Attorney-General of this province to determine what action can be taken against the NDP for using public moneys to try to influence an election. This is an intolerable abuse of the system, which clearly illustrates that the May 5 provincial election is being refought by the provincial NDP and their municipal counterparts.

"Your Worship, I would move that this council condemn this external NDP influence and condemn the provincial NDP for their attempts to deliberately affect the outcome of the municipal elections, particularly while claiming a role of non- involvement. This is sheer hypocrisy and deceit."

Mr. Speaker, I've read that from the Delta council meeting of November 7, to put it on the record — this member wants to talk about wasting taxpayers' money.

Now let me get back to the pen that he so kindly returned. I wonder what that member did with his pen that he got. I happened to check, and not one member of the NDP — although they like to complain — has returned his pen to the Speaker. I would think that if I were going to be against something, I'd take the nice little box it came in and ship it back.

Most other provinces and the federal parliament have pens with the crest of the country or the province on it. I'm very proud, when I go somewhere, to have a pen with the crest of British Columbia on it. It's small and picayune that these members want to pick on these things, in trying to do something to embarrass the Speaker of this Legislature. This is the only Legislature where, no matter who the Speaker is, they try to pick on that office. I would suggest to them that a little more courtesy towards that office might go a long way towards more courtesy in this Legislature.

I would suggest to the hon. member that the pens for this Legislature cost less than his mailing to aldermen across this province. He wants to talk about the cost to the taxpayer and the NDP and their friends in Solidarity. Mr. Speaker, you can remember the last session in this Legislature, when there were a lot of comments about whether Solidarity was acting out of the unemployment action centres across this province.

Interjection.

MR. REYNOLDS: No. they weren't doing that. We saw Kube doing his little tap-dance on television, saying, "No, no, we wouldn't do that," and we saw that great senator from British Columbia, Jack Austin, saying: "Well, we wouldn't give them the money if they were doing that." Well, let me tell you, Mr. Speaker, I've got a newspaper from my constituency and it has a front-page story that says: "Solidarity Group Forming Locally." This is from the Sunshine Coast News, August 22, 1983. The story is under a by-line by the Unemployment Action Centre. The story reads:

"As province-wide opposition to the government's restraint legislation spreads, several local groups are planning to form a Sunshine Coast chapter of the Solidarity coalition. Speaking in Gibsons on August 4, Operation Solidarity chairman Art Kube suggested that a local chapter be formed. On August 15 the Sunshine Coast joint council of unions decided

[ Page 3413 ]

to call a meeting to follow up on Kube's recommendations."

"All groups, organizations and individuals opposed to the proposed legislation are invited to attend, says joint council chairman Hans Penner. This legislation was called the worst in the history of Canada by the Imperial Police Association. It attacks human rights protection, minimum labour, tenant-landlord agreements, universal medicare, education and social services.

"The Solidarity Coalition is composed of groups and organizations in British Columbia that are opposed to the budget and legislative package. The local meeting will be held Thursday, August 25, at St. Bartholomew's Hall at 7:30 p. m. The hall is located at North Road and Highway 101 in Gibsons. For more information call Priscilla Brown at the Unemployment Action Centre, 886-2425, or Hans Penner, 886-8484."

Mr. Speaker, this group that's associated with Solidarity.... In fact, Solidarity is really the government in action, because these guys are the opposition of inaction. The Solidarity outside is doing some of the work that these people should be doing, and they're doing a better job, but they're doing it in an underhanded way, using federal tax money of unemployment action centres: public money to support the NDP and the socialist viewpoint of some of the labour leaders around this province.

MR. BLENCOE: Could you handle an investigation, John?

MR. REYNOLDS: See them sit there and start to yell. See them chirp and jump in their seats. They squirm.

MR. BLENCOE: Boo!

MR. REYNOLDS: Oh, there goes the second member for Victoria (Mr. Blencoe). He's gone out to sign his mail with his government pen that he forgot to return. Or maybe he's gone to send some more mail around the province for municipal elections next year. Or maybe he thinks I am going to run against him next election and he's gone out to start knocking on doors already. I don't know.

There are so many things you can talk about. The member for New Westminster (Mr. Cocke) has finally come into the House, and he wants to talk about the ombudsman. I don't really have to talk about the ombudsman, because he does most of that for himself lately. I think the Attorney-General (Hon. Mr. Smith) said things very well in this House yesterday and today. I'll leave the ombudsman up to the Attorney-General for the next little while.

I would like to make it very plain for that member, though, that the motion I put forth in this House was not to eliminate the ombudsman's office; it was to get rid of the ombudsman. I think he's the guy who should go. I support the ombudsman's office and the work they do; I think that some of the investigations they perform, they perform very well. But I will stand by the fact that a big chunk of their cases are frivolous and could be handled by other people. I think the present ombudsman has been too political in his career. I think there are quotes from past ombudsmen across this province that also say that. People who are not in politics have stated that he is in that vein, and I think he should go. In the first speech that I made in this Legislature, on the throne speech, I said that if I was on the committee for that ombudsman he certainly wouldn't get my vote to continue in his job in the next term. So I would suggest that I've been very consistent in that area.

MR. COCKE: Is he an embarrassment to you, John? Is that the problem?

MR. REYNOLDS: The New Democrats ask if the ombudsman's an embarrassment to me. I would suggest that he's not an embarrassment to me, he's an embarrassment to himself. The statements that the Attorney-General (Hon. Mr. Smith) made in this House yesterday indicate that that embarrassment is there. I think the ombudsman should not be involved in things. I sit there and watch the New Democrats smile about some of these things. You know, they like to convict people, Mr. Speaker, while there's a police investigation going on. They try to defend that by talking about democracy, but they don't really believe in the RCMP. They don't like the RCMP. They're afraid to let the RCMP do their investigation and report back to see if there's anything wrong.

[Mr. Speaker in the chair.]

MR. NICOLSON: What charges have been laid?

MR. REYNOLDS: That's the point the member for Nelson doesn't understand. The RCMP investigation is going on, and why does he want to interfere with that investigation?

Mr. Speaker.... I want to talk for a couple of minutes on....

MRS. WALLACE: Running out of material or something?

MR. REYNOLDS: I've got lots of material. It's just a matter of finding things that.... I have to simplify some of it because I know who's listening.

I would like to talk about the great job that the Minister of Environment (Hon. Mr. Brummet) has been doing over the past few months. In this province, as I mentioned earlier, because of this great budget of the Finance minister and the great job that all the ministers in this government are doing in holding down expenses and operating under very difficult times, difficult times that people are experiencing all over this world.... The Minister of Environment has had a tough job in the last few weeks over the wolf problem. I just want to suggest that he deserves a lot of support for the tough stand that he's taken, which is the right stand. I want to chastise Mr. Watson. the man who has been running around the north. He was trying to be the saviour of the seals, and now he's trying to be the saviour of the wolves. He didn't know what he was talking about when he was talking about seals, and I know the member for Coquitlam-Moody (Mr. Rose) could understand that, because in Ottawa you get an opportunity to meet people from other parts of the country and you get to understand the problems of Newfoundland and Prince Edward Island and why they have their seal kill every year to protect other parts of the environment.

Mr. Watson and his friends like to raise some money from Bo Derek and some of their friends in Hollywood. I know a number of members of the New Democratic Party don't

[ Page 3414 ]

support what he's been doing, but he goes up north and supposedly doesn't have a lot of money, but he flies in in a private airplane and stays in a pretty good hotel, and the people working with him all arrive by van. I guess he's just a little too high-profile to be driving in a van with the rest of the people.

I think the most important thing in this issue is tourism. Mr. Watson and his friends should ask themselves, when they start going down to Seattle and other areas to tell people not to come to British Columbia.... They can't have it both ways. They can't be saying at one point: "There is unemployment; we've got this and we've got that; but don't come to British Columbia." Tourism will be the number one industry in this province in the very near future. It will be the number one industry because of the great foresight the Premier of this province had when he decided to bring Expo 86 to this province. We don't need British Columbians, so-called environmentalists.... He probably wouldn't know a wolf from a sheep-dog. In fact they were down in Seattle, and even I knew they weren't wolves out in the street with them, but they were passing them off as wolves.

We don't need that kind of thing in this province. We need every British Columbian, no matter what his politics, to support Expo 86. We need the opposition in this Legislature....

HON. MR. CHABOT: And Mikey.

MR. REYNOLDS: We don't need Mikey. He won't be there in '86. The mayor of Vancouver will be gone by '86.

We need members of this Legislature who will get out and promote British Columbia. Not only across British Columbia: when they take their vacations, if they're taking them outside this province, we need them to talk in a positive tone about what we're doing in this province. We don't need members knocking this province when it is looking forward in 1986 to the greatest year in its history. We've seen too much of it in this province. A government that was trying to build a stadium in downtown Vancouver had to fight the New Democratic Party and their municipal supporters. But it was amazing. I was at the Grey Cup luncheon, as were some of the members of this House, and there was little Mikey up there making fun of the mayor of Toronto because Toronto didn't have a dome.

MR. SEGARTY: Mikey's got a dome.

[5:45]

MR. REYNOLDS: Mikey's had a dome all along.

I would only suggest that we learn from some of those things, Mr. Speaker. We've seen people across the province in the New Democratic Party knock Expo 86, knock some of the development. Let's get behind it; let's get behind the Minister of Tourism and his promotion of this province, and condemn anyone who wants to tell people they shouldn't be coming to British Columbia. The unemployed: nobody likes to see those people not working. The government should be congratulated. The Minister of Labour announced his student program today. I got it out in the mail to my constituency right away, saying: "Let's get a newsletter out. Let people know. Let's help some of these kids get summer jobs." Let's all work together, because those unemployed people are not just New Democrats, they're not just Socreds, they're also Conservatives and Liberals. If we all work together instead of fighting all the time, this province, in 1986, will be the greatest place in the world to be.

I'd like to move adjournment until the next sitting of the House.

Mr. Reynolds moved adjournment of the debate.

Motion approved.

MR. SPEAKER: Hon. members, a short while ago I received from the ombudsman an addendum report which I will read to the House. This is from the ombudsman of British Columbia: Addendum to Special Report No. 7 to the Legislative Assembly of British Columbia:

"On page 28 of my Special Report No. 7, I made the following comment: 'Documents on the ministry's file indicate that in March 1983 the Minister of Forests asked one of my complainants to get the ombudsman out of the investigation.' My comment was based in part on the letter found on the ministry's files. The letter was dated March 18, 1983, and was written to Mr. Waterland by Mr. Ian Mahood, one of the complainants. The letter, marked 'Personal and Confidential,' reads in part: 'Dear Tom: To demonstrate facts confirmed by 1982 scaling, I attach 'living colour.' I am on the same side as you politically. I am asked to get the ombudsman out of the investigation and control contractors until corrective action is in place. You can solve this to your advantage by the following actions...' [The letter then outlines a proposed resolution.]

"As ombudsman, I am concerned whenever there is a suggestion that an authority might attempt to put pressure upon a claimant to withdraw a complaint made to my office. For this reason my investigator contacted Mr. Mahood at the time the above letter came to our attention (prior to September 1983) and asked if such an attempt had been made. Mr. Mahood confirmed that he had had discussions with Mr. Waterland and that he had been asked in those discussions to get the ombudsman out of the investigation. Thus the comment on page 28 of my special report.

"Subsequent to the tabling of my special report, in response to questions in the House Mr. Waterland denied that he had ever made any effort to deter my investigation. Because of this, I re-examined the documents in question and obtained additional information from Mr. Mahood. Mr. Mahood has advised me now that prior to the writing of that March 18, 1983, letter to Mr. Waterland, he had had separate discussions with Mr. Waterland and with Mr. Ray Williston, formerly Minister of Forests, currently chairman and president of B.C. Cellulose Company, and that it was actually Mr. Williston who had suggested that Mr. Mahood should get the ombudsman out of the investigation. My solicitor has today contacted Mr. Williston and he has confirmed that he made the suggestion in the belief that the matter could be resolved internally.

"In short, the information initially obtained from Mr. Mahood indicated that there had been some attempt by Mr. Waterland to eliminate my involvement in the investigation. It is now clear that the suggestion did not come from Mr. Waterland.

[ Page 3415 ]

"I realize that my comment on page 28 of my Special Report No. 7 left the minister open to charges of impropriety, both in the House and before the public. I now bring this additional information to the attention of the Legislative Assembly in an effort to correct the erroneous information. I have expressed to Mr. Waterland my sincere regret about the inconvenience and embarrassment this comment has undoubtedly caused him."

"Signed, Karl Friedmann, ombudsman."

HON. MR. WATERLAND: Mr. Speaker, I would like to read into the letter, in addition to the comment just made by....

MR. SPEAKER: Would this fall into the category of a ministerial statement?

HON. MR. WATERLAND: Yes, it would.

MR. SPEAKER: Proceed.

HON. MR. WATERLAND: I had delivered by hand to me this afternoon — a short time ago — a letter from the ombudsman. I would like to read the contents of that letter into the record, and I will table the letter afterwards, Mr. Speaker. The letter was addressed to the Hon. Thomas M. Waterland, Minister of Forests, Parliament Buildings, Victoria, B.C.

"Dear Mr. Waterland:

"I wish to take this opportunity to express my deep regrets over the embarrassment caused to you as a result of my comment on page 28 of my report on Shoal Island, recently tabled in the Legislature.

"I have attached a draft addendum to the report, which I intend to give to the Speaker today for tabling in the House. The addendum explains the reasons for my comment on page 28 and my subsequent inquiries occasioned by your statement in the House that you did not attempt to thwart my investigation.

"I hope you will understand that I was acting on information contained in ministry files and other information before me at that time. I had no reason to question the accuracy of the information before me at that time. My subsequent inquiries revealed that the information I had relied on was incorrect.

"It is my desire that the record be set straight, and the only way of effectively ensuring this is to report the additional information to the House. I sincerely regret any inconvenience and embarrassment this comment has caused to you and hope that the tabling of this additional information will effectively withdraw the comment I made on page 28 of my special report.

"Karl A. Friedmann, Ombudsman."

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 5:53 p.m.