[ Page 3611 ]

CONTENTS

Routine Proceedings

Partnership Amendment Act, 1984 (Bill 8). Hon. Mr. Hewitt

Introduction and first reading –– 3611

Oral Questions

Cutbacks in health programs. Mrs. Dailly –– 3611

Mr. Hanson

Mr. Blencoe

Hiring practices of Quintette Coal Ltd. Mr. Gabelmann –– 3613

Ministerial statement: RCMP report on Shoal Island log scaling. Hon. Mr. Smith –– 3613

Mr. Barrett

Committee of Supply: Ministry of Finance estimates. (Hon. Mr. Curtis)

On vote 27: minister's office –– 3614

Hon. Mr. Curtis

Mr. Barrett

Mr. Reynolds

Mr. Rose

Mr. Passarell

Mr. Stupich

Tabling Documents –– 3635

Appendix –– 3636

MONDAY, MARCH 5, 1984

The House met at 2:05 p.m.

Prayers.

MR. STRACHAN: I'd like to take this opportunity this afternoon to welcome to the House Mrs. Kate Crowcroft, who is one of Vancouver Island's finest cooks and pastry chefs, and her cousin, Tom Harkins. Would the House please welcome these people to our assembly today.

MR. COCKE: Mr. Speaker, visiting from La Belle Province — Aylmer, Quebec, as a matter of fact — are Harvey and Gaby LaVallee. I'd like everyone to welcome them.

HON. MR. GARDOM: New Westminster en français at its best, Mr. Speaker.

On behalf of all members of the House I would very much like to re-extend a very warm and super spring-like welcome to the capital city to the twelve teams and their attendant families and numbers of friends and fans who have descended upon us to battle in the 55th Canadian Men's Curling Championships, the Labatt Brier.

HON. MRS. McCARTHY: Mr. Speaker, I'd like to introduce to the House a friend from the city of Vancouver who comes from a very community-minded family. Will the House please welcome Brad Reynolds.

HON. MR. SCHROEDER: Mr. Speaker, Little Red is here today. Please, for my sake, make her welcome.

HON. MR. GARDOM: Petit Rouge, Mr. Speaker.

Introduction of Bills

PARTNERSHIP AMENDMENT ACT, 1984

Hon. Mr. Hewitt presented a message from His Honour the Lieutenant-Governor: a bill intituled Partnership Amendment Act, 1984.

Bill 8 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Oral Questions

CUTBACKS IN HEALTH PROGRAMS

MRS. DAILLY: I have a question for the Minister of Health. The government is imposing an 8 percent income tax increase on all B.C. citizens, supposedly to maintain health care. Will the minister then advise the House why, at the same time as his government is planning to impose this income tax on all citizens, he is cutting back on all preventive programs, including the funding of health clinics?

HON. MR. NIELSEN: Mr. Speaker, I suppose the answer could go on almost indefinitely. The member is really asking me to rationalize the disbursal of the amount of money we have sought in our budget for next year. The increase in the Health budget next year, as outlined in the estimates, is approximately $51 million. Changes are to take place in the budget of the Ministry of Health with respect to individual grants, organizations, institutions and specific programs under health care. This year the increase will be approximately $51 million over the previous year. In addition, there will be other changes in the budget with respect to amounts allotted for various programs. Yes, some grants are being reduced. Notice has been given to some organizations that there will be reductions in some grants but overall the funding for health care will be increased. Without additional sources of revenue by way of surtax or others, we would have been in the position of seeing the possibility of a reduction in the amount of money available for health care in the province.

So we've had to make changes. There is a net increase of $51 million as opposed to the possibility of a reduction, which would have meant further reductions right across the board for all aspects of health care in the province. I don't think it is inconsistent at all. We have said frequently that health is our number one priority, and I think the budget suggests that that is correct.

MRS. DAILLY: Mr. Speaker, I don't think the minister really paid any attention to the second part of my question — probably purposely. So I would like to ask, as a first supplementary: is the minister not aware of the importance of preventive programs in health, relative to the reduction of health costs?

Secondly, and more specifically in that realm, I'd like to ask the minister about his reduction in the amount of money to the Reach clinic in Vancouver Centre, which is known for its preventive health care. Specifically, why has he imposed a cutback of $27,000, or 27 percent of the operating funds for this vital preventive service?

HON. MR. NIELSEN: Mr. Speaker, I presume, because the question was permitted, that it's appropriate to discuss next year's estimates at this time. Regarding reduction of health costs, the member may be suggesting that at some time emphasis on the preventive health side will reduce costs eventually. At the present time it would be seen as additional costs, and quite appropriately spent in that way.

Our preventive services continue to be well funded in the province: perhaps not to the extent some people would wish, but we still must maintain our budgets in those areas which are on the curative side, and that represents the vast majority of the moneys expended. We have just so much money to expend under health care in the province and we are trying to allocate it to those programs which require it. Certainly there are going to be some modifications and possibly reductions in various grants, organizations and others.

The Reach clinic the member spoke of has had a reduction of 27 percent, from $326,000 to approximately $239,000. We believe the Reach program can continue to function and we believe the funding is appropriate. I think almost every organization sought additional funding this year, but we simply do not have the funds to meet all of their requests. We've had to go through our grants program and make such modifications as are necessary to ensure that we have the funding for the various programs which the ministry has supported for a number of years. There is nothing more mysterious about the Reach Community Health Centre's reduction than that the money was not there to meet their request for the year. We have made similar changes in various

[ Page 3612 ]

grants throughout the province to try to accommodate as many of these associations and organizations as we can. Because of the difficulties in meeting all the requirements under our budget, we have had to make decisions, and one decision has affected the Reach program. We still believe they can function, and we still believe they can offer a useful service to the citizens.

[2:15]

MR. HANSON: The James Bay Community Project in Victoria provides integrated health and social services for a community of 12,000 people. Will the minister advise why he has slashed 27 percent of Health ministry funding from the James Bay project?

HON. MR. NIELSEN: The same situation prevails with the James Bay Community Human Resources and Health Centre. The centre was established in the mid-seventies to provide preventive and primary health care to the young transient population. Today the centre is primarily involved in family practice operations. Last year the centre received approximately $184,000 in addition to $200,000 from the Medical Services Commission. Once again, we believe the centre can continue to function. Their funding has been reduced from $184,000 to $134,000, but I understand they will continue to receive approximately $200,000 from the Medical Services Commission.

We believe that the funding level is considered adequate for that which is being offered by the centre, and the centre will have to prioritize what it is offering in that particular community. We believe that there are considerable savings in the administrative side. We have yet to hear from the James Bay Community Centre, as far as I know, as to what their decision in that respect will be, and we wait to hear from them. The James Bay Community Human Resources and Health Centre, the Reach centre and others are no different than any other organization in the province. When we are short of funds, we must make some decisions, and those decisions have been made.

MR. HANSON: Supplementary, Mr. Speaker. As the minister stated, the James Bay project provides preventive health care for senior citizens, which are approximately half of the 12,000 population of James Bay. The program there keeps senior citizens from having to occupy acute-care or extended-care beds, because preventive diagnostic services are available to them so they are not going into an acute-care bed because of over-medication, loneliness, lack of activation or something of that nature.

I want to ask the minister what consideration he has given to the effect that these cutbacks will have in filling up acute-care and extended-care beds, which is a far more costly way of providing service of a medical nature to these citizens.

HON. MR. NIELSEN: Mr. Speaker, the assumptions the member has reached, I suppose, could be achieved if one wished to take a certain point of view with respect to what the James Bay Community Centre may do and what it possibly could do. The officials within the ministry believe that the amount of grants available next year to the James Bay Community Centre will be adequate for their purposes. Once again, we will be requesting from them a report as to what they intend to modify in their programs, and we will be then better able to relate to what the effect could be. I emphasize once again that there is quite a real possibility that some moneys could be saved through administrative modification. We believe that the medical side of it is still going to remain adequate, and I emphasize that approximately $334,000 will be available to them for their operation next year.

MR. BLENCOE: Mr. Speaker, a direct question to the same minister: is the minister aware that his own evaluation by his own ministry has shown that this program is totally cost-effective, is an excellent way to deliver service and has been proved to save the taxpayer thousands and thousands of dollars, and that by removing this prevention side of things, by removing the ability of the doctors to work in the community as much as 60 to 70 hours a week, he indeed is going to cost the taxpayers of British Columbia a lot more money? Is he aware of those circumstances?

HON. MR. NIELSEN: Overall, I am not aware of those circumstances, because I don't agree with the conclusions reached by that member. I certainly don't believe that any program in the province is totally cost-effective.

MR. BLENCOE: One last supplementary: is the minister prepared to release the $51 million that he's holding over from the federal government and put that into health care? There's $51 million unaccounted for. With the James Bay Community Project and the Reach project dealing with people on a daily basis, much of that money could be going to these prevention programs. Is he prepared to release that $51 million?

HON. MR. NIELSEN: Mr. Speaker, the $51 million is the amount of money by which the budget has increased over last year. I presume that's what the member is referring to. There are priorities throughout the Ministry of Health and throughout the province. All of the money in the budget in excess of $2.5 billion must be allocated throughout the province for various purposes. It's easy for that member to ask that more and more money be placed in the Victoria area, because he represents the constituency, but we also have to respond to all other citizens in the province and other MLAs who are requesting funding for various projects within their constituencies, along with other organizations which are provincial in nature or perhaps are within a constituency or a community. There is a limited amount of money to expend on health care.

Health is the only ministry which has received an increase for the next fiscal year, and it is not very difficult to understand that there is a certain limit to what that allocation can be. Money is being distributed throughout the province to the best ability of those people responsible within the Ministry of Health. We must make decisions, decisions will be made and decisions have been made. The member may have his opinion as to cost-effectiveness of various programs, including the James Bay Community Health Centre, but people in the ministry also have their opinions, and they've done their analysis. I can't agree with that member that all of these assumptions he has made are correct. The resource centre will continue to operate, and we believe they can continue to provide good service to the community. That's the money they have this year, and they're going to get along with it.

[ Page 3613 ]

HIRING PRACTICES OF QUINTETTE COAL LTD.

MR. GABELMANN: My question is to the Minister of Labour. Will the minister advise why Quintette Coal, whose operations are subsidized by the taxpayers, is currently recruiting heavy-equipment operators and heavy-duty mechanics in Sudbury and Labrador City rather than hiring such trades in British Columbia?

HON. MR. McCLELLAND: I wasn't aware that Quintette was subsidized by the taxpayers.

MR. GABELMANN: I'll ask another question. Will the minister advise whether Quintette has filed a manpower plan with the minister under article 13 of the comprehensive agreement between the province and Quintette Coal, and whether Quintette's manpower plan includes the hiring of heavy-equipment operators and mechanics from eastern Canada.

HON. MR. McCLELLAND: I think the member would be better to ask the minister with whom that plan would have been filed, and it is not me.

MR. GABELMANN: Mr. Speaker, I wonder if the Minister of Labour would advise whether the government has any policy in this area and whether it has issued any guidelines to Quintette requesting that they hire British Columbians for these taxpayer- subsidized jobs.

HON. MR. McCLELLAND: It is the responsibility of companies that are planning projects such as the one in which Quintette is involved to file manpower reports with the government as part of their total overall operating report, and that has been done, I'm sure, in this instance.

Secondly, I understand that under the Canadian Charter of Rights there is a freedom of movement section, which does not allow us to put up barriers or fences at our provincial borders.

MR. SPEAKER: Hon. members, the member for Alberni has advised the Chair that he wishes to rise on a matter under standing order 35.

MR. SKELLY: Thank you, Mr. Speaker. I ask leave to move adjournment of the House under standing order 35 to debate a definite matter of urgent public importance. The matter concerns the testing of the cruise missile over Canadian soil, and the urgency is that these tests are scheduled to begin tomorrow morning.

Many Canadians feel that testing another nation's missiles on our soil infringes upon our sovereignty, reduces this nation's effectiveness in negotiating worldwide nuclear arms reductions, and also makes Canada a participant in an arms race which is based on a principle of mutual assured destruction.

I'm sure, Mr. Speaker, that you'll consider this matter of immediate and urgent public importance. I would encourage you to come to a decision on this matter as quickly as possible.

I also have a motion for the Speaker to consider. The motion is that....

MR. SPEAKER: Thank you, hon. member. The motion need not be read; it must only accompany. The member has briefly stated his case. The Chair will undertake to review the matter and bring a response back to the House at the earliest opportunity.

MR. SKELLY: Would it be possible to consider this matter immediately, or after a recess?

MR. SPEAKER: Order, please, hon. member. The Chair has given an undertaking that it will bring the matter back to the House at the earliest opportunity.

MR. SKELLY: Would it be possible, Mr. Speaker, to ask leave of the House to recess the House to give the Speaker time to consider this issue? It is a matter of some urgency.

MR. SPEAKER: Order, please. Hon. member, the Chair has ruled on numerous occasions that it will not adjourn the business of the House on matters relating to standing order 35, or other matters that are raised that would be an infringement upon members' abilities to carry out the duties for which they have been elected. The Chair will undertake to bring the matter to the House at the earliest opportunity.

MR. SKELLY: Could I ask leave then, to suspend the rules of the House to present the motion right now, and to have the members of the House make a decision on that basis now?

MR. SPEAKER: Hon. member, the Chair has recognized the member for the purposes of making a statement under standing order 35, and that is the only reason that the member was recognized. To do otherwise would be beyond the standing orders of our chamber.

RCMP REPORT ON SHOAL ISLAND LOG SCALING

HON. MR. SMITH: I wish to advise the Legislature that the RCMP report into the criminal investigation on Shoal Island log scaling has been received and examined by me. The investigation did not reveal any criminal activity; my officials have recommended no further action, and on the basis of the present information I concur with that recommendation.

The RCMP investigation was initiated by my officials on January 26 in response to a letter from Mr. Ian Mahood of January 11. In that letter Mr. Mahood stated that he'd been provided a copy of scale returns taken from the files of the ministry — that is, Forests — that are said to be falsified records. He also suggested that there could be collusion to defraud, as he put it.

By the time the RCMP interviewed Mr. Mahood concerning his allegations of criminality, the log-scaling report of the ombudsman had already been laid before the Legislature and was the subject of major public discussion. When interviewed by the RCMP officers, Mr. Mahood was questioned specifically about his allegations of falsified records in his letter of January 11. Mr. Mahood now advised the investigators that he had no evidence to suggest any criminal activity and that he did not believe scaling reports had been deliberately falsified. Mr. Mahood also made like statements through the media. Considering the results of this interview with Mr. Mahood and the high level of news coverage,

[ Page 3614 ]

investigators could not consider that the original allegations of criminal activity warranted further investigation.

Mr. Speaker, the government is now free to consider and respond publicly to the ombudsman's report, which we will do in a full and fair way at the earliest opportunity.

[2:30]

MR. BARRETT: Mr. Speaker, any fair-minded person will welcome the statement by the Attorney-General today and congratulate the RCMP for the swift, prompt action taken on the interpretation that the government gave to Mr. Mahood's allegations. It is strange to me that the Attorney-General has yet to announce the completion of the criminal investigation in the Tourism ministry, but that is a separate matter.

Mr. Speaker, now that the Attorney-General has made this statement, now that this matter is, by the Attorney-General's own admission, discussible by this august chamber, can the Attorney-General tell this assembly why Mr. Mahood, Mr. Friedmann and Mr. Williston are not called to the bar of this House to explain the statements on this case? Can the Attorney-General explain, in giving his report today, why no mention was made of the fact that the ombudsman's report is given to the Legislature, not to the government, and of the fact that that report is still in front of us, and still no schedule of action which should have accompanied the Attorney-General's statement today as to the exact time and place that we're going to hear from Mr. Williston, Mr. Mahood and the ombudsman?

Mr. Speaker, I ask the House to consider the fact that the Attorney-General's report is, frankly, blatantly incomplete; with the knowledge that there was no criminal investigation necessary, with the knowledge that allegations were incorrect, that substantiated the position of the ombudsman, who said so right from the start. I find it interesting that in the report to this House, where apologies have been demanded from both sides of the House, there is no apology from the Attorney-General to the ombudsman for the statements made in face of the fact of the position taken by the ombudsman. At no time did the ombudsman say that there was a criminal activity — at no time.

Now that we have this admission from the Attorney-General, I want to know — and the public has a right to know within 24 hours at a maximum — when the ombudsman will be called to that bar, when Mr. Mahood will be called to that bar and when Mr. Williston will be called to that bar, because serious allegations of malfeasance of administration — not of criminal malfeasance, but malfeasance of administration — have been hurled at the government through the Minister of Forests, and nothing has been done about it. Twenty-four hours would be gracious; I will be gracious. I would expect to hear an apology too.

Mr. Gabelmann tabled a document he referred to between the Minister of Labour (Hon. Mr. McClelland) and Quintette Coal Ltd.

Orders of the Day

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

ESTIMATES: MINISTRY OF FINANCE

On vote 27: minister's office, $185,567.

HON. MR. CURTIS: Mr. Chairman, we're back again, just several weeks after the debate on my estimates for the fiscal year coming to a close.

I would like to make a few introductory remarks. Perhaps I could acknowledge the presence in the chamber today, to assist me, of the Assistant Deputy Minister of Finance, David Emerson, who, the House will know, was announced last week as the Deputy Minister of Finance designate, to assume his position at or about the end of April, at the time of the departure of the current deputy, Larry Bell. I will have more to say about Mr. Bell in the course of the next few weeks, but I am particularly pleased, on behalf of the government, that someone of Mr. Emerson's competence is able to assume the position of deputy in the weeks to come.

To summarize, for the benefit of the committee, the 1984-85 estimates for the Ministry of Finance, the members will note that there are essentially four votes. There are two others, but the four main votes are numbers 27 through 30: vote 27, the operations of the office of the minister; vote 28, the operations of the various divisions of the ministry, including the Purchasing Commission; vote 29, providing a grant to the Provincial Capital Commission, with respect to their activities in the capital region; and vote 30, providing for the operation of the office of the commissioner of the CSP program. The total expenditure requested for these four votes for the fiscal year 1984-85 amounts to $58.9 million, which represents a decrease of nearly $5 million, or 7.8 percent, compared to the comparable 1983-84 estimates.

As with other ministries, 1984-85 is to be a year in which the Ministry of Finance — therefore all taxpayers — will benefit from lower expenditure requirements as a result of restraint and productivity measures taken in the current and recent fiscal years. For this ministry, measures taken to date include the consolidation of the economics and policy division with Treasury Board staff under a single and a more effective structure; a reduction in paper flow related to the financial function by 30 percent, as a result of various initiatives introduced through the comptroller-general; the establishment of the provincial treasury as a financial enterprise for which all costs are recovered from the various Crown corporations and from funds for which it provides funds management as well as fiscal agency services; lower costs of goods for the ministry — and all ministries, I might say parenthetically — as a result of opportunities captured by the Purchasing Commission, which is within this ministry vote; automation of revenue collection services in government agents' offices; the return of ICBC services to the private sector in all but approximately 20 government agent locations; savings of over $400,000 in annual building occupancy costs, due largely to office consolidations; and reduction of the ministry vehicle fleet by 25 percent, with the planned disposition of 19 vehicles. In sum, Mr. Chairman, these and other expenditure restraint and productivity measures taken to date are to yield full-year benefits in terms of lower expenditure requirements in the fiscal year of 1984-85 and in future years.

Additional productivity targets for the ministry for the year 1984-85 include $12 million in savings by the Purchasing Commission through various discount negotiations with suppliers, over and above those that are in place now; the reduction, again, of paper flow through the office of the comptroller-general to 50 percent of the 1982-83 level; increasing the province's utilization of electronic funds transfer for making payments, including direct deposit of government

[ Page 3615 ]

employee payroll, resulting not only in a smoother delivery to the employee but an efficient method at a lower cost — the provincial treasury will also be developing an approach to collecting revenues in a similar manner; the development of an automated system for the production of licence formats; the production of information through government agents' offices to provide more efficient and effective service to the people we serve; and a reduction of another $400,000, or about 15 percent, in the cost of computer data entry as a result of careful monitoring of project priorities.

That was a brief summary, Mr. Chairman, of some of the responsibilities and activities within the ministry in the year coming to a close, but more particularly in the fiscal year that is about to start on April 1 –– I look forward to answering questions that members of the committee may have.

MR. BARRETT: Mr. Chairman, I want to thank the minister for his summation. I do not necessarily agree with it, but I do appreciate the summation. I agree, too, that the best and most efficient manner of dealing with estimates is a series of questions. So to facilitate the best use of time I do have a couple of questions that I would like to start off with the minister.

Some weeks ago I asked the minister in question period when the ombudsman's report with regard to the Shoal Island case came to his attention as it was delivered to Treasury board and/or cabinet. I would like to know now, from the minister, when he became aware of the report.

HON. MR. CURTIS: Mr. Chairman, I think I answered that in question period or following question period. It was approximately January 21, plus or minus a couple of days.

MR. BARRETT: Mr. Chairman, in terms of precise memory the date is not a matter of great import. It's just to know that the minister has had some knowledge of this since the end of January. Has the minister, with the information in front of him, initiated any action, either by memo to the Minister of Forests (Hon. Mr. Waterland) or through investigation with his own department, to recover the money lost to the Crown because of this discrepancy?

HON. MR. CURTIS: Mr. Chairman, of course there have been discussions within the Ministry of Finance with respect to the Shoal Island matter. Indeed, the question of the potential in lost revenues to the Crown has been a subject of conversation within the ministry. I have held off on a more definite move with respect to that in terms of dealing with my officials pending the investigation which was referred to earlier today in the House by the Attorney-General.

MR. BARRETT: Could the Minister of Finance inform the House as to the nature of the conversations, who they were directed to and what particular legislative focus they had in regard to recovery of these funds?

HON. MR. CURTIS: I wonder if the member would expand on the term — "legislative focus" I believe is the phrase he used.

MR. BARRETT: The existing laws that allow the Crown to act in cases like this.

HON. MR. CURTIS: In cases which may be like this, there is a clear responsibility through the Ministry of Finance — and in particular on the revenue side, as the member would know — to ensure that all moneys which are due the Crown are collected by the Crown. Again, the discussions I've held with officials have been very general, pending further investigations undertaken by another minister on the basis of allegations which were made and which appeared to be very serious at that particular point in time. I think in his material a few weeks ago the Attorney-General indicated that a resident of British Columbia — i.e. Mr. Mahood — had communicated directly with the Deputy Minister of Finance. It was at that time that the Deputy Minister of Finance referred the matter, as indeed he should, to the office of the Ministry of the Attorney-General.

MR. BARRETT: Mr. Chairman, this is a case that has been dragging on for some years — between 1978 and 1981. I can appreciate the minister suggesting that conversations took place after the ombudsman's report, but can the minister inform this House whether or not his ministry, with statute authority and responsibility, made any effort, as soon as this claim came to the attention of the Ministry of Finance, to see whether or not the money concerned was recoverable? Were any memos, correspondence or departmental action taken in writing to pursue this request or this problem?

HON. MR. CURTIS: Mr. Chairman, as I indicated to the committee just a few moments ago, whether it is the specific of Shoal Island, which has attracted considerable attention, or whether it is that particular ministry — i.e. Forests in general — there remains a clear responsibility not only on the Minister of Finance, whoever that may be at the time, but on the officials within the Ministry of Finance to ensure, if moneys appear to be due to the Crown, that every action is taken to recover those or to secure them.

[2:45]

MR. BARRETT: I couldn't agree more with the Minister of Finance in his last statement. It's absolutely correct, through you, Mr. Chairman, that if money appears to be owing to the Crown, action should be taken to recover those moneys and that action should be taken through the Ministry of Finance. Can the minister inform this House if he at any time wrote a letter to B.C. Forest Products and said: "We'd like to recover our money"?

HON. MR. CURTIS: Mr. Chairman, to the best of my recollection, no. No such letter went over my signature to B.C. Forest Products.

MR. BARRETT: Mr. Chairman, in the pursuit of his job as Minister of Finance, can the minister inform us if he took any action to recover this money on behalf of the people of British Columbia, other than asking some questions of the Minister of Forests?

HON. MR. CURTIS: I think, Mr. Chairman, that the Leader of the Opposition has perhaps glossed over — unintentionally, I'm sure — the action which I had taken with respect to the Shoal Island question or any other similar question. Other than speaking to the minister concerned, in this case the Minister of Forests, I clearly state again the very definite responsibility for the Minister of Finance and for

[ Page 3616 ]

officials in the Ministry of Finance to be aware of possible situations where moneys may be owing to the Crown and to act on those possibilities. It is not something which was dealt with over the space of two or three days and forgotten or left, Mr. Member, but indeed is quite clearly an ongoing procedure.

MR. BARRETT: Mr. Chairman, again I find myself in total agreement philosophically in regard to administration of the Ministry of Finance by the Minister. It is correct. No one disagrees with the minister. An ongoing evaluation of a complaint with the potential loss of revenue to the Crown would be incumbent upon the Ministry of Finance to follow. I couldn't agree more. All I'm asking is if the minister can give this House some evidence that that ongoing examination, study and investigation took place. Had it taken place, perhaps this ombudsman's report would not have been necessary. It could be interpreted, through you, Mr. Chairman, that the ombudsman actually did the work of the Ministry of Finance. Surely while all this work was going on with the ombudsman, somewhere deep in the bowels of the complex Ministry of Finance that requires such high-level dedication, someone — some lowly minion who is not yet subject to restraint — wrote a memo saying: "Hey, maybe they owe us some money here and we'd like to collect."

In the intervening years that took place between the initial complaint and the ombudsman's report filed in this House, was there any internal investigation by the Ministry of Finance into the possibility of us, the taxpayers, recovering some money owing us?

HON. MR. CURTIS: Mr. Chairman, I wonder if the member would assist me in answering the questions by indicating whether he has the view that the matter raised by Mr. Mahood — the matter which was the subject of the ombudsman's report to this chamber — was in fact going on for a number of years. Is that the essence of the question?

MR. BARRETT: Mr. Chairman, I would ask the minister to put his seatbelt on and buckle himself in for a shock. If he's not aware of this information now and he hasn't had a chance to peruse the report, which he's been aware of since January, this complaint has been in front of the government for over three years. Three years! If the minister is saying that it first came to his attention only through the ombudsman's report, that flies in face of the facts. I'm asking the minister for a simple answer. Did you initiate any studies whatsoever in your responsibility as Minister of Finance to see whether or not money owing or alleged to be owing to the Crown was collectible? Was an effort made to collect it?

HON. MR. CURTIS: Mr. Chairman, I'm pleased that the member further qualified the question, because much of his earlier questions dealt with the so-called Shoal Island case. I believe his first question in his series this afternoon was: "When did you become aware of the ombudsman's report?" I answered: "January 21, plus or minus a couple of days."

The member will know from his time as Minister of Finance that internal audit practices are carried out on a regular basis; I assume they were in the period 1972-75, and certainly I'm satisfied that they have been since 1975-76. I might say parenthetically that they have been accelerated in the last five to six years, and indeed, quite apart from the specific area of concern raised by the ombudsman, on a fairly regular basis the office of the comptroller-general instructs that internal audit procedures take place in a number of ministries. One was underway in the summer of 1983 with respect to the Ministry of Forests, only insofar as moneys owing or possibly owing to the Crown were concerned. I'm sorry that I don't have the precise date that that internal audit was concluded. It could be revisited at some other time, of course.

MR. BARRETT: I want to thank the minister for his answer. He informs the House — and I wish to be correct — that an internal audit took place through his ministry of the Forests ministry to see if funds were properly coming to the Crown or being collected. Those were your words, Mr. Minister?

HON. MR. CURTIS: Close enough.

MR. BARRETT: Now you have received a report on that internal audit; you've just told the House that. Did that report on the internal audit, as routinely scheduled by your ministry, indicate that there was a problem in any way with collecting funds related to stumpage?

HON. MR. CURTIS: I think it would be correct to say that the question of stumpage revenues and revenues due the Crown through the Ministry of Forests is a matter which is constantly of concern to the office of the comptroller-general. I think that has been the case for many years and will undoubtedly, because of its complexity, be the case for a good number of years to come. The internal audit division of the office of the comptroller-general, as I say, was looking at an audit of the scale and royalty system in 1983, with the general conclusion that it was indeed complex and that there was still doubt, which will remain, as to all the revenues due coming to the Crown, and quite apart from that as to whether all revenues coming to the Crown were coming in a timely manner. I'm concerned about that, and I tell the committee that I am. I have been concerned about that, and I don't think that after the passage of my estimates in the next few days I will be able to say that I am no longer concerned about that. It is, as the committee will know — particularly those who have served in the treasury benches — an extremely complex and often frustrating process. I'm speaking now of the collection of revenues from our major industry, forests. I think the Ministry of Finance should strive for perfection; I think that the office of the comptroller-general should be and is striving for perfection. I don't want to appear pessimistic but, rather, realistic when I say that I'm not satisfied that we will easily achieve absolute perfection. But the member should know, and I assure the committee, that this matter is not concluded insofar as I'm concerned. I speak of the whole question of the collection of revenues from the forest industry. There may be Shoal Islands from time to time, but the broad issue is by no means complete, and I certainly don't intend to turn away from it.

MR. BARRETT: I am overwhelmed with gratitude that the minister does not intend to turn away from this problem. It's not a question of turning away from the problem that disturbs me; it's the lack of action on the solution I'm seeking. I want to say in all generosity how impressed I am with the eloquence of the minister in finding the method he has

[ Page 3617 ]

found to circumvent answering the question. Yes, the minister stands up and talks, and becomes impressed with his own fluff. The voice deepens, the reason sounds reasonable, the concern sounds concernable, and the action sounds actionable. It certainly is actionable.

In general terms we're talking about hundreds of millions of dollars. One specific instance has been a matter of complaint for some three years. This matter could not be dealt with by anyone to the point that the ombudsman had to get involved. What were you doing for the three years that this specific complaint was around? I've learned today with joy, happiness and with unremitting pleasure that you've had an internal audit saying, "Gee, we're not perfect." Hallelujah! The government has admitted it's not perfect. I would have thought that a brief view in a mirror would have made that self-evident. Nonetheless, since that simple course could not be taken, you had an approach of having a study to find out whether or not you're perfect. And guess what? Lo and behold, they found the courageous bureaucrat who told them they were not perfect. I hope he hasn't been dismissed.

I come back to the simple question to the minister. At any time since you have been Minister of Finance have you initiated any specific action to recover any moneys related to scaling problems from any company operating in the forest industry in the province of British Columbia? Once? Anytime?

HON. MR. CURTIS: Mr. Chairman, I indicated to the member earlier this afternoon that the answer to that question would be yes. Don't be surprised, Mr. Member. You and I go at this annually, whether it's forestry or something else. I'm sorry if my voice deepens. It's just that the eloquence of your questions rivets my attention.

MR. BARRETT: My God!

HON. MR. CURTIS: Well, you see, you get the same in return, Mr. Member. I'm going to miss you.

MR. BARRETT: This is a great exchange of love ballads, but let's have some information.

HON. MR. CURTIS: Well, Mr. Chairman, I'm surely allowed the same kind of eloquence.

MR. BARRETT: Certainly. Make love to me.

HON. MR. CURTIS: No, no, no.

[3:00]

Interjections.

HON. MR. CURTIS: I say again for the member who is conducting the cross-examination this afternoon: yes, we are concerned about the amount of revenue which comes to the Crown from the forest industry. Again, we're concerned about money which is due to the Crown from any other industry. But we are discussing forestry this afternoon, in the debate on my estimates, the minister's office. Of course, the very fact that an internal audit of the Ministry of Forests....

Let no one think that this is some isolated task force thing that moves in on one particular ministry and then doesn't do it again. There is an internal audit division of the Ministry of Finance — OCG, the office of the comptroller-general.

Frankly, I am pleased that officials of the office of the comptroller-general aren't standing back waiting for the Minister of Finance of the day to say: "Hey, isn't it about time you conducted an internal audit on this activity or that activity in government?" They take that upon themselves. They undertake those as they, as professionals, see the responsibility to be. So for the member to ask of me if there was one time that I had directed that there be an internal audit — or an investigation, was the term he used.... He shakes his head in the negative. Okay, I'll let him clarify. I became so fascinated with the question, I've forgotten what it started with.

MR. BARRETT: Mr. Chairman. I'm sorry that my questions are fascinating the minister to the point that he forgets what he said at the beginning of his last answer.

I asked if he recalled if there were any specific instances where billing had taken place for inadequate log scaling, or where money is due because of inadequate log scaling.

I heard — and I probably heard incorrectly — the minister say "yes, such instances had taken place." If I heard incorrectly, then ignore the following question. If I heard correctly, can you give me a list of companies who have been billed because of inadequate scaling?

Furthermore, you say that you're pleased that the ministry has not stood back for internal audit. Well, I'm happy that you're happy, and I want you to know that I'm happy that they haven't stood back. But in their action — and go back to the simple question that I started out with — have they specifically investigated the allegations related to the Shoal Island case, which have been known to the government for over three and a half years?

HON. MR. CURTIS: The member will know that the actual collection of revenues from forests — the billing and the collecting — is undertaken not by the Ministry of Finance but by the Ministry of Forests. It may, therefore, be more appropriate that some of the detail regarding billing and collecting be reviewed at the time of the debate of the estimates of the Minister of Forests, which will occur later. I indicated to the member, and say again, that certainly the government has been concerned. I have been concerned, quite apart from the Shoal Island case, for some considerable time as to the appropriateness of the collection process and whether in fact revenues due to the Crown are being collected in full, The member may find it tedious, but I have to tell the committee again, as the member knows from his time, that in the whole collection and stumpage process, expenditure through stumpage is exceedingly complex. I think it is part of my responsibility to make recommendations to government — which I cannot do this afternoon, but which I will be doing in due course — as to how we can simplify that process and ensure that all members of the House are more comfortable with the collection and billing procedures. It may be that some changes will be required. I don't know that yet. I can't reach that conclusion thus far. Again, one can understand — and I think the Leader of the Opposition will understand — that on a fairly regular basis someone in the office of the comptroller-general, because of the sheer size of the operation and the industry, would be in touch with someone in the Ministry of Forests with respect to this question: is the Crown receiving that which is due to it?

MR. BARRETT: Was someone in the Ministry of Finance in touch with someone in the Ministry of Forests

[ Page 3618 ]

regarding the Shoal Island case and complaint? Was someone in the Ministry of Finance in touch with someone in the Ministry of Forests concerning the questions regarding the complexity, as the minister describes them, over collecting revenue from the forest industry through royalties and through stumpage? Particularly, was someone in the Ministry of Forests reached by someone in the Ministry of Finance in light of the statements by the auditor-general, who said that the methods of administration — of funding and billing in the ministry — were not very good? If someone was in touch with someone, would the minister tell us who that someone was from the Ministry of Finance in touch with who that someone was from the Ministry of Forests? And after someone met someone, was there someone's memo saying "we have to take some action on this"?

The minister has a complex job. That's why he has employees. But when it comes to collecting money, there is no problem with the government chasing some small businessman who owes money on the social services tax. I don't recall a case of someone going to the ombudsman demanding that a social services tax be reviewed because the government isn't collecting and that a report come to this House. When the minister talks about the seriousness and responsibility of being the Minister of Finance, no one could be more overwhelmed with the seriousness of that job than people who had previously served in that position. As a matter of fact, Mr. Speaker, I found that it was advisable to say to the department: "If anybody owes us money, collect it." We don't need a audit. We need collections.

For the government to have a Minister of Finance not collecting money, particularly in a time of restraint, is a very serious problem. I recall that my first experience in collecting money as Minister of Finance related to revenue from the gas industry, where a previous Minister of Finance and a previous administration was not collecting enough money from natural gas. The first collection we made within months was $22 million. Do you know how we made that collection? I gave an order: Go get that money! I would feel a lot better today if the minister assured this House that he operates on a philosophy that if there is money due to the Crown, his orders are: "Go get that money!" No one has a more hard-hearted task than the Minister of Finance, and if you're going to be painted as a meanie, then we assume that you are one when it comes to money owed to the people of British Columbia.

Mr. Speaker, this matter has gone on for years. Four years these complaints have been laid out by the ombudsman. Since receiving the ombudsman's complaint, I still haven't had any indication that you have ordered someone in your department to go after this money. I have asked you a series of questions, and I'd be happy to get the answers.

HON. MR. CURTIS: Mr. Chairman, the member spoke about: "Go get the money." I certainly have indicated this on more than one occasion in a variety of activities. However, "Go, get the money" smacks of that which has been occurring in Ottawa recently, or which has come to light in Ottawa recently. Frankly, I don't think it's good enough — if I may say so, Mr. Chairman, through you to the committee — to simply say: "Go get the money."

First of all, surely the member would agree, having served as a Minister of Finance, that you have to find out if the money is owing. Now with all respect to the ombudsman and the attention which has been focused on his report presented to this Legislature — and it is not for me to say in debate on my estimates whether he moved too quickly with respect to the report — I feel obliged to pay far more attention to the recommendations of the auditor-general of the province of British Columbia in terms of accounting for dollars which are due to the Crown, and therefore to the taxpayers of British Columbia. It is a fact that the auditor-general appointed by this government has made specific comment with regard to revenues from a variety of sources, and she has been critical of some of the procedures which have been followed. That's what I am attempting to tell the member, and I think the member surely understands that I mean what I say. We had an internal audit — a lengthy process; we recognize the complexity of the system.

I said a few minutes ago that it may be appropriate for the collection system in the forest industry — and therefore in the Ministry of Forests — to be changed, to be altered. It may be indeed that because of the significance of that revenue, it should be more directly associated with the Ministry of Finance than with the Ministry of Forests, but that's not for me in isolation to say. I say it may be. But the member knows, the committee knows and I know, Mr. Chairman, that the auditor-general has spoken about the collection process in the Ministry of Forests and in the forest industry. I am sure the member knows as well that in the past few years this ministry has issued an annual response to the report of the auditor-general. It may not satisfy the member's line of questioning this afternoon, but I continue to strive for the fairest and most complete system of collecting that which is due to the Crown.

[3:15]

We are speaking about the forest industry. I have no proof, but I would think that individuals who collect money under the Social Service Tax Act will have been to the ombudsman from time to time. Certainly you in your time and I in mine have signed a lot of letters where social service tax appeals have been dealt with; where taxpayers — those who collect the money — appeal, whether it is social service tax or some other tax. That process is going on all the time. I wondered if the now Leader of the Opposition had signed as many letters as I did, and I asked because I wanted to know if W.A.C. Bennett and the Minister of Finance from 1972 to 1975 and then my predecessor in this government had signed so many letters of appeal. That's off the point, but of course there is constantly dispute about money which is owing the Crown. I don't want to head a ministry that rushes in....

I'm giving you your next argument, Mr. Member; I appreciate that, but I don't want to be the Minister of Finance who just rushes in and grabs the dough. I want to be satisfied — indeed I have to be satisfied — and certainly I would think that the auditor-general would have to be satisfied that the money which is collected is in fact due. I speak again about the very significant complexity of this, not as a defence but simply to keep it in perspective; and if it's complex now, then I'm sure it was complex when that member was Minister of Finance. We're not through yet with improving that system, and I'm not through in terms of carrying a series of recommendations — some of which I've not even finally reached a conclusion on — to government with respect to that money and its magnitude and ways in which it can be collected in a completely fair and straightforward manner.

MR. BARRETT: Mr. Chairman, I don't ask the minister to give me further argument. I know you've got a complex ministry. When I say, "Collect the money," I say, "Collect the

[ Page 3619 ]

money that is due." Any Minister of Finance worth the salt in his brand new pair of shoes would collect the money that's due. For example, when the minister talks about the former W.A.C. Bennett's administration collecting money that's due.... Ottawa would send the money to British Columbia by mail. British Columbia would then get the cheque, sign it and put it in the bank. We were collecting money that was due.

Mr. Minister, being a frugal mortgage-holder, I asked a simple question of my staff, who are outstanding people: "Would it not be wiser, instead of waiting for the mail to deliver the cheque, to put the money from the cheque in the bank in Ottawa so that we make interest every single second?" Guess what? No auditor-general, no big investigation, just an order from the Minister of Finance saying: "Collect the money, and don't let the banks make an extra penny off it." Was that unfair? Was that cruel or harsh? Not at all. I was doing my job as Minister of Finance. I went home and told my wife, and she said: "Oh, if you would only handle our finances at home in the same manner!" With all that power and all that advice, it is necessary to give the order: "Collect the money when it's due."

Mr. Minister of Finance, the case has been made specifically by the ombudsman. It has been made in general terms, noteworthy of praise from yourself, by the auditor-general. I asked you a simple question: name the someone in your ministry who wrote the someone — whom I asked to be named — in the Ministry of Forests to correct the problems raised in general by the auditor-general. Specifically, have you instructed anyone, someone — name desired — under "help wanted"...? Have you instructed anyone to ask someone in the Ministry of Forests what actions they've initiated to get this money back for the people of British Columbia?

What I'm asking for is not systems. I understand the systems. I'm asking if you've taken any action. Do you know of any specific case that you took specific action on in regard to collecting funds, in what appears to be — graciously speaking — an inadequate accounting system in the Ministry of Forests? Have you taken any specific action to collect money owing?

HON. MR. CURTIS: Mr. Chairman, the answer to the question is yes.

The member asks for names. Certainly if the member looks at the organizational structure of the Ministry of Finance, he would know that a primary responsibility for that rests with the office of the comptroller-general. There would also be some responsibility within Treasury Board staff which would work with contact individuals in the Ministry of Forests.

If the member requires the specific names of individuals within the two ministries, I can't provide that this afternoon. I don't have that, but I have again indicated the routing of the kind of contact: OCG, Ministry of Forests, internal audit. We have a director of internal audit, and that name is also a matter of public record. That kind of contact is something which was not triggered by Shoal Island. The point I was trying to make earlier was that it has been going on for some considerable time, and in all candour I have to say that I believe it will be continuing for some considerable time.

MR. BARRETT: To your knowledge, do you know of any specific case that has been triggered by the system described by you that has required a rebilling on stumpage in the last four or five years?

HON. MR. CURTIS: I will attempt to get that specific information, in order to be completely accurate in answering the member, Mr. Chairman.

MR. BARRETT: Thank you. To be fair, I also intended to include the Shoal Island case in that question. Has any specific instruction gone from your department, through the existing machinery, to collect money on the Shoal Island case?

HON. MR. CURTIS: Mr. Chairman, I think I indicated some time ago that.... First of all, the Ministry of Forests does the billing and the collecting — the member knows that. However, that is not to pass off the responsibility which rests with the Ministry of Finance to ensure that the billing is being done correctly.

With respect to Shoal Island, when I said earlier that I received, or became aware of, the ombudsman's report on or about January 21, 1984, without doubt I then wanted to await the completion of the investigation which was triggered as a result of Mr. Mahood's letter to the Deputy Minister of Finance. I've already told the committee that upon receipt of that letter, with allegations which were tabled in the House, not in committee, the Deputy Minister of Finance, without coming to me to see whether he should or should not, but understanding the seriousness of the allegations, referred the matter to the Ministry of Attorney-General, as he should. I received a copy of that letter indicating that allegations had been made in the specific Shoal Island case. If those allegations had any veracity whatsoever, they should be referred to the chief law enforcement officer's ministry in this province, and that was done.

MR. BARRETT: Mr. Chairman, allegations had been made by these logging contractors that they had not received a fair amount of money for the work they had done. Included in that was the allegation that the Crown had not received a fair return from the forests. Can the minister tell the House when he was first aware of the Shoal Island case? When was he first notified that there was a complaint? When was he first aware that there was a problem — the approximate date?

[Mr. Pelton in the chair.]

HON. MR. CURTIS: Mr. Chairman, it would be difficult for me to provide a precise date with respect to becoming aware of the Shoal Island case. During our time together in this portfolio the Deputy Minister of Finance and I have developed a pattern of meeting regularly — not a staff meeting involving a number of people, but only the two of us — during which meetings we discuss a variety of projects and problems, and I would think it was in the course of one of those meetings that I first heard the words "Shoal Island" in this context.

MR. BARRETT: Could you tell the House whether it was in the last year or two years? Do you have an idea when it was?

HON. MR. CURTIS: I'm reluctant to try to approximate, not in order to withhold information from the committee; but

[ Page 3620 ]

I would really have no way of being sure that that date is of any use at all to the member or to the committee.

MR. BARRETT: The specific date is of no use to me, but I would like to know in general terms whether you recall if it was a year ago or a couple of years ago or six months ago.

HON. MR. CURTIS: The member will know that I have always tried to be an honourable member of this House in terms of giving dates and information. I am very reluctant to approximate, because I could be off by some months. But if it helps the member, some time in 1983.

MR. BARRETT: Yes, it does help me. It confirms that the ombudsman's report was not the first time you were aware of this case. I know the minister is busy, but the minister has said that these kinds of complaints trigger automatic response within his ministry. I'm not going to hold you to a specific time in 1983, but some time in 1983 is fair. It's your own answer. During that specific time in 1983, to your knowledge was the Deputy Minister of Finance triggered to pursue this problem to see if money was owing to the Crown, in light of the knowledge that your own internal audit had pointed out that Ministry of Forests' processes for collecting money were not perfect and that the auditor-general had indicated there were problems? My simple question is: when that first came to the attention of the deputy, and when it first came to your attention sometime in 1983, why was there not an immediate memo to the Ministry of Forests? Or was there an immediate memo to the Ministry of Forests concerning this case saying: "Hey, is there money owing to us here?"

HON. MR. CURTIS: I think it's important to restate this. With an internal audit of forestry revenue occurring roughly in the middle of 1983 and with an internal audit process — again, not something that has occurred only with respect to the Ministry of Forests — occurring in the Ministry of Forests a couple of years before that — so I think it has been twice in the last four years — and with internal audit activities undertaken in other ministries as a natural course of events and a part of the duty of the office of the comptroller-general, a specific such as Shoal Island would not be the subject of a particular directive from me or from the deputy minister, but rather would be another indication of, as I said, the complexity of the collection of revenues in the forest industry, revenues which may be due to the Crown.

[3:30]

MR. BARRETT: I understand what the minister said, and I don't mean to be critical of the minister unless I have a chance — and, Mr. Minister, you have given me that chance. I know what you want me to believe, sir, but I don't intend to believe it. I don't intend to believe that the Minister of Finance is as incompetent as he self-describes. To follow through his series of answers, the minister has stated to this House that there was an internal audit going on in the Ministry of Forests. Very good. But part of the reason for the internal audit going on were the responsible, critical statements of the auditor-general.

Sometime in 1983 the Deputy Minister of Finance came to the minister and said: "Sir, we have a problem of a complaint regarding Shoal Island." Having heard that, the minister wants me to accept that his only action was to ignore it because an internal audit was already going on. Now sir, through you, Mr. Chairman, are you asking me to believe, this matter having been drawn to the attention of the Deputy Attorney-General and of yourself, that the public would have confidence in a government or a Minister of Finance who would say: "Well, there's an internal audit going on, period"? Mr. Chairman, I want to know why the deputy didn't automatically trigger — through use of the minister's own description of his duties — a memorandum to the Ministry of Forests, saying: "Hey, is money owed to us in this case, and if so how do we collect it?" I don't want to believe that once this information was brought to the attention of the Minister of Finance it ended there — the specific case, not the audit. What I've been left to believe is that a signal was given to the minister by the deputy minister that there was a problem in Shoal Island about the collection of funds, and the minister did not act on that signal by specifically triggering a memorandum to the Ministry of Forests, saying: "Can you please clarify this?" If I am misinterpreting the minister, I sit to be corrected. But my impression — through you, Mr. Chairman, and only through you, Mr. Chairman — is that sometime in 1983, upon the minister's receipt of the information from the Deputy Minister of Finance that there was a serious complaint regarding Shoal Island, nothing was ordered by him regarding this case and nothing was triggered by the deputy regarding this case. Is that correct?

HON. MR. CURTIS: No, Mr. Chairman, that is not correct. It may not suit the member's purpose this afternoon in his questions....

Interjection.

HON. MR. CURTIS: No, no, no. I'm not imputing motives.

MR. BARRETT: No, we're having conversations....

HON. MR. CURTIS: See how he interrupts? He is interfering with us.

MR. BARRETT: I'm listening and taking notes with devout attention.

HON. MR. CURTIS: No, you're not. It's a serious matter.

MR. BARRETT: Yes, it certainly is.

HON. MR. CURTIS: It is a serious matter, Mr. Member. Please don't attempt to excuse what you perceive to be my lack of action by saying: "I know you're busy." The fact is that we had been concerned long before I'd even thought of Ian Mahood in this context. Long before I knew that it was a matter that had been referred to the ombudsman, I had been concerned because of the complexity, not because I was busy, not because the Deputy Minister of Finance or the Minister of Forests or the Deputy Minister of Forests didn't take their jobs seriously. The damned process is very complex, and, Mr. Chairman, the member knows that. It's judgmental in many respects. It is and has been the subject of litigation over a good number of years: Who sold what? How much? What was the weight involved? Where have they gone? It goes on

[ Page 3621 ]

and on. It is a very complicated process. I think in his heart of hearts the member understands that.

I instructed officials within the Ministry of Finance to pursue the matter of Shoal Island with the Ministry of Forests. I didn't just walk away from it — not that the member inferred that, but he did infer that I was sort of too busy to really be concerned about it. At the same time, there remains the much larger issue of the complex nature of getting the amount of money due the Crown without simply riding roughshod over everyone involved in the process. I think the member also knows that.

The litigation reports which come to my desk on a regular basis show the number of taxpayers — I use "taxpayers" in the broadest sense, not individuals as much as corporations — who are suggesting that they will take us to court, as is their right, or are in the process of taking us to court. The member knows that there are taxation issues which go back — correct me if I'm wrong — into 1976, '77, '78, '79. They've been appealed.

MR. BARRETT: Some earlier.

HON. MR. CURTIS: Some earlier; okay. They go back many, many years. One major department store chain in the country is still probably going to take us to another court with respect to the sales tax levied on catalogues. The member understands clearly.

I recognized then, and recognize now, the seriousness of the possibility that the Crown is not receiving all that is due to it. But you don't solve it in a week. With respect, Mr. Chairman, you don't solve it in a month or six months; and in some cases, as the member and I know, you don't solve it in five years.

MR. BARRETT: Mr. Chairman, just so we can total up the score of everything we agree on, which is overwhelmingly in favour on the disagreement side, we agree that collecting taxation relating to forestry is very complex. We're in agreement that an internal audit on the methods was going on. We agree with that. We agree that some cases last for years and years. But we also agree that there was no litigation in the Shoal Island case. Right? You did make the statement, in the midst of all of your last answers — through you, Mr. Chairman — that at some time in 1983 you instructed your department to check into the Shoal Island case. Did you get an answer from that? Was it a memo? Was that order followed by your department? Could you tell me what date that order was followed and did you get an answer from that checking in?

HON. MR. CURTIS: Mr. Chairman, I indicated earlier that the Deputy Minister of Finance and I, over time and on a regular basis, discuss a variety of matters. I don't think there's a document I could produce for the committee this afternoon to show that on a particular date I instructed the deputy minister — in writing, signed "Hugh Curtis" — to pursue the Shoal Island thing. I take it as a matter of course, when a problem is identified for me or a difficulty is referred to me, and when it is discussed and action is to be taken, that it's going to be taken. I can only repeat in this particular instance that notwithstanding the longer-lasting and continuing review of the process of billing and collecting by the Ministry of Forests, through the office of the comptroller-general essentially, but not exclusively, there was one called "Shoal Island."

MR. BARRETT: Mr. Chairman, I heard the minister say that he instructed his deputy minister to look into the Shoal Island case. I'm not asking for a copy of that order, but I'm assuming that what the hon. minister said is correct. You said to your deputy minister: "Check into this." The words I have from your earlier comments were that you instructed him to check into it. Did you get a report back on it?

HON. MR. CURTIS: Not a report as such, Mr. Chairman, because it has been an ongoing.... We sit here on March 5. It's been an ongoing review. Insofar as I know, the Deputy Minister of Finance and the office of the comptroller-general halted their active pursuit of that over a relatively short space of time following the indication by correspondence, which has been tabled in this House, from Mr. Mahood to the Deputy Minister of Finance alleging corrupt practice. Therefore, until we have receipt of the investigation by the RCMP which was ordered by the criminal justice section of the Ministry of the Attorney General, again over a short space of time, I think it's appropriate — the member may disagree — that the review by the Ministry of Finance would be temporarily suspended.

MR. BARRETT: Mr. Chairman, I couldn't agree more with the minister. This seems to really be a hand-holding session. In stretching out my hand in sympathy and compassion to the minister, I understand fully that once the....

[3:45]

Interjection.

MR. BARRETT: Little Red's gone, eh? This is committee, Mr. Chairman. We're entitled to these little exchanges.

Nobody would expect the department to continue to investigate once the police were in. Now that the police are gone, you will continue. I'm trying to find out if in this extraordinary instance where a number of charges were made — serious allegations leading to that letter by Mr. Mahood causing the police to be called — and they were brought to your attention sometime in 1983....

HON. MR. CURTIS: No, no.

MR. BARRETT: That's what you said. Okay, if the minister is interpreting that somehow I'm saying that charges of criminal activity were brought to his attention in 1983, that's not at all what I'm saying. I'm saying that those were not brought forward to cause the RCMP to come in until January 1984. Prior to that time there was no mention of criminal activity, but there was a mention to you, by your own admission, sometime in 1983 by the deputy that there was a problem with Shoal Island and collecting revenue for the Crown.

From that sometime in 1983 an investigation was going on. Could the minister tell the House who was doing the investigation? Was there a preliminary report? With whom in the Ministry of Forests did that person doing the investigation interview or discuss this problem?

HON. MR. CURTIS: Mr. Chairman, I'm pleased that the member, in leading up to this question, clarified a point that could very easily be misunderstood. On that date, which I

[ Page 3622 ]

can't precisely identify, when the Deputy Minister of Finance indicated that there were difficulties with respect to perhaps collecting that which is due the Crown on Shoal Island, that was it. That was the extent of the concern.

Who in the Ministry of Finance dealt with the Ministry of Forests? It would be the director of internal audit in the office of the comptroller-general and the appropriate economic development director in Treasury Board staff.

If the member wishes the names of the....

MR. BARRETT: No, it's okay. Just the positions.

HON. MR. CURTIS: Okay. Director of internal audit, office of the comptroller-general, and the director or economic development in Treasury Board staff. I could offer the personal names to the member some other time.

MR. BARRETT: Would the minister undertake to find out who the director of internal audit in the comptroller-general's department spoke to in the Ministry of Forests?

HON. MR. CURTIS: Mr. Chairman, I will undertake to get the name of that position on the other side.

MR. BARRETT: Yes, the Minister of Finance has undertaken to inform the committee who the director of internal audit spoke to sometime in 1983 in the Ministry of Forests concerning the Shoal Island case. Thank you.

Now that we have a statement from the minister that the director of internal audit in the comptroller-general's department discussed the Shoal Island case with someone in the Ministry of Forests, was no report forthcoming? Did the Deputy Minister of Finance not bring this case to your attention again? Did you ask for an updating on the Shoal Island case after that one discussion?

HON. MR. CURTIS: I'd like to welcome the official critic for the Official Opposition, who....

MR. BARRETT: I'm sure you would.

HON. MR. CURTIS: No, no. I've enjoyed the exchange....

MR. BARRETT: We're not finished yet.

HON. MR. CURTIS: Oh, I'm sure we're not. Tomorrow, Wednesday, Thursday.... No, not Wednesday; I can't be here Wednesday.

MR. BARRETT: We're almost there.

HON. MR. CURTIS: No, no, we're not almost there. We're not almost there, Mr. Chairman, through you to the member, because the matter is not yet concluded.

MR. BARRETT: That's right.

HON. MR. CURTIS: You can say, "that's right," indicating that you have your views of it, but I tell the committee that I certainly have my views of that specific as well as the general problem associated with the judgmental aspect, the debatable aspect, of collecting revenues in the forest industry for the Crown, being fair to the industry, to the participants in the industry and to the taxpayer. It is very easy to be heavy-handed about this thing, but that doesn't necessarily mean that one is being fair, and I suggest the committee would agree with that, Mr. Chairman.

As I recall the question, other than the time that the Deputy Minister of Finance indicated there was concern with respect to possible shortage of revenue or shortcoming in revenues due the Crown — possible, I emphasize — at Shoal Island.... Of course, it was discussed subsequently in the kind of meeting between the deputy minister and me which I indicated before and which occur sometimes three times a week.

MR. BARRETT: Was there a subsequent discussion or was there only one discussion? As I follow it through, you have informed the House that it was brought to your attention that there was a particular problem with Shoal Island sometime in 1983. At that time the deputy and you discussed it, and you told the House that the director of internal audit and the comptroller-general's department would then discuss this particular case with the appropriate person in the Ministry of Forests. That's what I've got so far. After that was triggered — to use your own expression — was this subject ever raised with you again prior to the ombudsman's report coming to your attention? Was this subject ever raised to your attention again by the Deputy Minister of Finance or anyone else?

HON. MR. CURTIS: By the Deputy Minister of Finance, Mr. Chairman. The answer to the question is yes.

MR. BARRETT: Oh!

HON. MR. CURTIS: The member seems surprised. The fact is I indicated that on occasion the Deputy Minister of Finance and I would meet once, twice or three or four times a week. There were a couple of weeks in January, Mr. Member, where I took a holiday in Victoria.

MR. BARRETT: Good place to holiday.

HON. MR. CURTIS: Saanich is better — a great place to holiday.

I holidayed in Saanich, so there were two and a half weeks in January when I didn't want to discuss anything with anyone, and frankly I make no apology to the House or the committee for that. Yes, on more than one occasion, from the time that the question of Shoal Island was first raised until the matter was clearly under review by the RCMP, the deputy minister and I did discuss Shoal Island and — this is the important part to understand — the continuing difficulties associated with accuracy and efficiency and fairness in the collection of revenues by the Ministry of Forests — revenues passed to the Crown, to the taxpayers, out of that industry. That discussion didn't just start because of one isolated incident, and it will not end, as I indicated earlier today, just because of one isolated incident or the resolution thereof.

MR. BARRETT: Much to the chagrin of all of us, this has been a matter of debate prior to parties even being formed in British Columbia — the question of collecting adequate revenue from the treasures, i.e., the trees, of this province. Of course, at no time am I suggesting that the minister did not have an ongoing discussion, but what I have been interested in finding out, and have found out, is that the minister says

[ Page 3623 ]

that after the Shoal Island case was brought to his attention sometime in 1983, that triggered an inquiry or some contact regarding Shoal Island between the director of internal audit, the comptroller-general's department and the appropriate person in the Ministry of Forests. Then the minister says that there were subsequent discussions around this complex problem of collection of forestry stumpage, and in those discussions Shoal Island was mentioned a number of times again. During the mentioning of Shoal Island a number of times again, was the minister given any indication of what the director of internal audit in the comptroller-general's department had learned from the Ministry of Forests about this particular case?

HON. MR. CURTIS: I think, Mr. Chairman, that one of two things has happened this afternoon: the member is mistaken on one point, or I, unintentionally, misled the committee. We can check that by reviewing the Blues.

The director of internal audit, either personally or by delegation, and the director of the economic development side of Treasury Board staff liaised, met and discussed the question of the collection and billing procedures in the Ministry of Forests, but not specifically because of Shoal Island. Somehow in the discussion this afternoon I think the two have crossed. That was not: "Oh, oh, get someone from internal audit to go to see someone in Forests, about Shoal Island specifically, within the next four or five days." I did say, and I repeat, that from time to time, from when I first heard of apparent difficulties associated with scaling at Shoal Island, the Deputy Minister of Finance and I discussed that. If I misled the committee earlier — and I don't think I did — it was unintentional. The relationship, the contact and the discussion between the OCG, the director of economic development of Treasury Board staff and the Ministry of Forests predates, I am quite sure, the first indication that something might be incorrect at Shoal Island, because of the auditor-general's report on scaling, stumpage, and so on, in general.

[4:00]

MR. BARRETT: Mr. Chairman, I'm afraid that in checking the Blues we'll come to the same conclusion I did. The minister is now telling the House that no "specific" triggering of looking at the Shoal Island case took place. It's got to be one way or the other so I understand exactly what I'm dealing with. The minister is now stating — and the minister is honourable, and I accept that — that if it was misleading or misinforming to the House before, we wash away that record and start from square one. The minister is telling the House now that no "specific" triggering of the Shoal Island case, through the Deputy Minister of Finance down to the appropriate person in the comptroller-general's department on to the Ministry of Forests, took place. In other words, the conversation on Shoal Island between the minister and the deputy minister ended there, in terms of a specific examination.

HON. MR. CURTIS: No, Mr. Chairman. I've indicated that the office of the comptroller-general, the director of internal audit and the director of economic development. Treasury Board staff, were earlier, and on a much broader basis, working with and reviewing the practices in the Ministry of Forests on scaling, stumpage and the whole thing — not Shoal Island specifically, not the interior, not the coast, but simply the whole issue — as a result of the concerns which had been expressed, i.e. the auditor-general's report.

Then there comes a day in 1983 when the Deputy Minister of Finance first makes me aware of the specifics of Shoal Island. Have you got that? I've already told the committee that that was not a one-time discussion which was raised, discussed, dropped and then on to other things. Of course, it was mentioned in subsequent informal meetings — the kind of meetings which the member knows well would occur between a minister and his deputy. Then, I would think, wrapped into the kind of discussions which were already underway between Finance and Forests, the specifics of Shoal Island would be raised. Later still, by the time it was apparent that allegations were made regarding possible criminal activity — and the member has already responded to this — the immediate and specific review of that one area of British Columbia was, one would say, not put on the back burner, but was at least suspended temporarily until we had a police report indicating that there were or were not criminal activities. As I told you earlier, Mr. Chairman, with the receipt of that report we can again, as is our obligation, pursue those issues that are specifically and directly related to Shoal Island.

MR. BARRETT: You see, Mr. Chairman, the minister is strong, clear and precise up to a point, and then new words are being used — and I take note of those new words. I want to follow through with what the minister is saying. For some time, the minister tells us, there has been an internal audit of this whole process. It took place last summer. Correct? Okay. At a specific conversation between the minister and his deputy, the minister mentioned the Shoal Island case....

HON. MR. CURTIS: The other way around.

MR. BARRETT: The deputy minister mentioned the Shoal Island case. Right. Okay. Earlier on, I'm afraid that the House was misled into believing that the minister then ordered the deputy to have the comptroller-general's department look into this. You will recall, when I asked you that question, that you said, "No, I haven't got that order in writing; no, I don't remember the day," but he was ordered.

Now the words change; the words now are: "Then I would think that that specific of Shoal Island would be looked into."

Now my question to the minister is this: did you or did you not, when this case was brought to your attention, specifically order an investigation through the channels you have clearly outlined in this House? Did you order that a report be prepared or an investigation take place on the Shoal Island case?

HON. MR. CURTIS: Mr. Chairman, it is correct that earlier I said that upon hearing from the Deputy Minister of Finance with regard to apparent difficulties at Shoal Island, my response was not a memo, not an order, not a directive, not an instruction, but simply the reaction: "Well, will you look into it?" I assumed from that, as the member would understand — and indeed more than assumed; I would know — that it was pursued and is still being pursued, having been suspended during this period of time while "alleged criminal activities" were under investigation. But there should be no doubt about that, and I'll look forward to reading the Blues tomorrow. I'm sure the member would not play with the words that I've offered.

[ Page 3624 ]

MR. BARRETT: No, no.

HON. MR. CURTIS: Problem identified. Okay?

MR. BARRETT: Yes, right.

HON. MR. CURTIS: Much broader and more far-reaching discussion is going on between the Ministry of Finance and the Ministry of Forests with regard to this decades-old difficulty, as the member himself has said, as to the accuracy, the fairness and the completeness of getting revenues for the Crown from that industry. Then one pops up — as they do from time to time — is discussed, and is discussed again in the course of normal relationships between the deputy minister and the minister while discussing 15 or 20 other items as well.

MR. BARRETT: Well, just so we end this — and I understand it's tomorrow, or some time when you give me the answers — as I understand it, what you've just said is that when this was brought to your attention by the Deputy Minister of Finance you said: "Will you look into it — i.e. Shoal Island?" So we know that sometime in 1983 you triggered a request to your deputy to look specifically into Shoal Island. Now we've got that. Did you get an answer at any time prior to the announcement of the police investigation that one way or the other the complaints were valid or invalid, and can you tell us who in the Ministry of Forests was approached by your person from the comptroller-general to explain this case? And were any written memos whatsoever exchanged, or was this all conducted verbally, as you've described?

HON. MR. CURTIS: Mr. Chairman, I do not know at this point in time, and will provide for the member and the committee the name of the individual or individuals in the Ministry of Forests contacted as a result of this. As I understand the first part of the member's most recent question, you asked whether the Deputy Minister of Finance came back to me at some point in time and said there was something absolutely, positively irrefutably wrong, or, on the other hand, that there was absolutely nothing wrong.

MR. BARRETT: Or any report.

HON. MR. CURTIS: Now he interjects. I've already told the committee that the question of a possible shortfall in a revenue to the Crown at Shoal Island was discussed by the Deputy Minister of Finance and me on several occasions. That's not new information for the committee.

MR. BARRETT: Okay. You told him to look into it?

HON. MR. CURTIS: That was the first instruction or request: look into it. But that report was never complete for the reasons which I've stated. I'm surprised the Chair hasn't ruled me out of order for being tedious and repetitious, because before the member and I discussed this, when there were fewer members of the committee present than there are now....

AN HON. MEMBER: We'd like to hear it.

HON. MR. CURTIS: Okay. I'll say it again. Some of these matters take.... As the member himself acknowledged earlier, some matters that are far simpler than the question of stumpage and scaling revenues to the Crown take literally months and months to finally resolve. So let's speak of the extreme. Let's say — and I'm sure it isn't the case — that the Deputy Minister of Finance first told me about Shoal Island in the middle of the year. Let's say I first heard about it in July — and I'm quite satisfied that that would be very, very early. The member knows that the matter could not possibly be finally resolved in terms of thinking we were short this much money or, alternatively, that there was no more money for us. That wouldn't be done within five, six or seven months. Then the rest is a matter of public record — namely, that a complaint was made, with certain allegations. And I say again, the Deputy Minister of Finance then correctly went to the appropriate senior official in the Ministry of the Attorney General — not minister to minister, but deputy minister to the director of criminal investigations in the Ministry of the Attorney General — and said: "Look, these allegations suggest that someone has been undertaking criminal activity." It was at that point that the active pursuit of that specific was temporarily suspended by the Ministry of Finance, and for good reason.

MR. BARRETT: Mr. Chairman, I think that the explanation at the end.... Somebody from your department taking the letter to the A-G, the alleged criminal investigation and then the investigation is a matter of record. It was done in writing, as a matter of fact. What I'm trying to get at is this: was there nothing in writing on the Shoal Island case in your department before that? Is there nothing on file on Shoal Island in your department anywhere? Is there anything in writing on a complaint re Shoal Island, to your knowledge, before the conversation of, say, July 1983?

HON. MR. CURTIS: No, no, I used that as an example.

MR. BARRETT: Well, you say that the first time it was brought to your attention was some time in 1983.

HON. MR. CURTIS: Yes, right.

MR. BARRETT: Okay. To your knowledge, was there anything in writing complaining about this case before it was brought to your attention — say, six months or a year or a year and a half ago? Could you find that out for me?

Is there any written record, memorandum or exchange of correspondence that you know of that exists between your department and the Ministry of Forests after this case was brought to your attention? Was there anything in writing from our department, and in return from the Ministry of Forests, about this case? Or was it all a verbal look for that period of time before it was halted because the police were called in?

[Mr. Strachan in the chair.]

HON. MR. CURTIS: Mr. Chairman, I will review and determine if in fact there is anything in writing. But I make he point again, that as is appropriate — and I find it most effective — it is not good enough for a minister to sit in splendid isolation. Continual, ongoing, regular meetings with the deputy are the most productive way in which to carry

[ Page 3625 ]

out the work of the ministry and, therefore, the work of the people.

MR. BARRETT: Would the minister undertake to table that correspondence in the House.

[4:15]

HON. MR. CURTIS: Well, it's a hypothetical question, Mr. Chairman, and I'm not going to make much of the fact that you can't table in committee, as the member well knows. It's a hypothetical question, because I said I would look to determine what there is. I'm sure these estimates will continue to be debated tomorrow and the next day. I'll take that under consideration.

MR. BARRETT: You'll take it under consideration and perhaps give an answer tomorrow? I'll conclude my questions until that time. Thank you.

MR. REYNOLDS: Mr. Chairman, I hadn't really planned to get up here and get involved in this committee, but....

MR. BARRETT: Then sit down.

MR. REYNOLDS: The Leader of the Opposition says: "Sit down." Well, really....

MR. BARRETT: You hadn't planned to get up, so what are you getting up for?

MR. REYNOLDS: He didn't let me finish my sentence.

It's either a choice of sitting here and reading the annual report of the Ministry of Transportation and Highways or getting up and asking questions.

MR. BARRETT: Well, make your choice.

MR. REYNOLDS: If you've seen that report, you know why I'm standing up here right now.

Mr. Chairman, the Leader of the Opposition spent a lot of time questioning the Minister of Finance on this Shoal Island situation. I don't question what he's doing as Leader of the Opposition. He probably thinks it's the proper attack to make. Maybe if he can try to dig something up against this government before he leaves his many years of service to this province, then maybe he thinks he's doing the best thing. But in question period today the Leader of the Opposition talked about the government asking the RCMP for an investigation....

MR. BARRETT: Mr. Chairman, on a point of order, I would be happy to debate my estimates when they are called, but we're dealing with the estimates of the Minister of Finance. Should the House wish to go to my estimates I'd be happy to oblige the member. But shall we stay in order?

MR. CHAIRMAN: The point of order as stated by the Leader of the Opposition is well taken. We are discussing the estimates of the Ministry of Finance. Therefore we will discuss the administrative actions of that department. Please proceed.

MR. REYNOLDS: Mr. Chairman, I respect that, but I also have to make some comments. The Leader of the Opposition has a very thin skin when he doesn't like us to comment on what he's already been talking about.

MR. CHAIRMAN: The Leader of the Opposition on a point of order.

MR. BARRETT: I am never thin-skinned about the rules, through you, Mr. Chairman. I ask you to apply the rules.

MR. CHAIRMAN: Good point of order, thank you. The personal reflections should also be avoided. We are discussing the estimates of the Minister of Finance. The member continues.

MR. REYNOLDS: The Leader of the Opposition is never worried about the rules except when they are put on himself, Mr. Chairman.

MR. CHAIRMAN: Order, please. To the estimates.

MR. REYNOLDS: I would like to congratulate the Minister of Finance for the great budget and I wish him godspeed....

I was at a meeting in my constituency this morning and I couldn't....

MR. LAUK: Where did you hold it? In a cab?

MR. REYNOLDS: No, we held it, if you want a free ad, at the Ambleside Inn in West Vancouver, which is a very nice place to go for breakfast, lunch and dinner, if you happen to be out in the area.

There were about 120 people there. In my talk this morning I was stressing the activities of the Minister of Finance in his budget and some of the items that were in that budget. One of the the things that I think is so important in this minister's estimates, Mr. Chairman, is that for the first time in 31 years the provincial budget has been reduced from the previous year. I think the people I was speaking to this morning were appreciative of that fact and of the job that the Minister of Finance has been doing in running his department. I think the general consensus from those people was that if the Minister of Finance of this province could convince the other nine ministers of finance to bring in the same type of budget that he had brought into this province, this country would be better off.

MR. CHAIRMAN: I really must comment once again that we are reflecting now on a previous vote which has already been taken by the House. We are in Committee of Supply now discussing the estimates of the Minister of Finance, a discussion that clearly has to be centred around the administrative actions of the department and not other legislation or other matters that come before the House.

MR. REYNOLDS: Mr. Chairman, being such a new member, I wonder if you could define what the Committee of Supply is so I don't go outside the guidelines that you would like me to go under.

[ Page 3626 ]

MR. CHAIRMAN: Let me just quote from Sir Erskine May, since you are asking for some assistance. Sir Erskine May advises us that the Committee of Supply does not afford the proper opportunity for discussing which minister should represent the government with respect to estimates under consideration but does allow us to discuss the administrative action of the department which is open to debate. We cannot discuss the necessity for legislation in matters involving legislation; nor can the actions of high public service be criticized. Therefore I will advise the member that it is incumbent upon all members of the committee to discuss only the administrative actions of the department whose estimates are before us, which at this time is the Ministry of Finance.

MR. REYNOLDS: Thank you, Mr. Chairman, for those enlightening remarks. If I had known we were that confined, I probably would have been jumping up and down when the Leader of the Opposition was up.

I would just like to congratulate the Minister of Finance on the way he runs his department and on the way he answered the questions from the Leader of the Opposition today — the leader of that party that tries to find things under rocks that aren't there. He's done a great job in his department. His staff has done a great job, and I guess it would be proper when talking about the administrative ends of his department to congratulate Mr. Larry Bell, who has done such a great job as the deputy minister in this province.

MR. BARRETT: No names.

MR. REYNOLDS: I don't mind giving his name out, because I think it's a credit to this province that we had such a fine individual in that job. I wish him great success in his new job helping the credit unions straighten themselves out. I know he'll do a great job for them also. So congratulations to the minister and his staff for the great job they've done, and continued good work, from the constituents of West Vancouver–Howe Sound.

MR. ROSE: Mr. Chairman, I doubt that I'll be able to equal the praise extended by the last speaker, but I'll try not to be grudging or ungenerous; it's not part of my temperament or personality.

Because of some conflicting reports, I was interested in examining with the Minister of Finance whether or not the province of British Columbia received a larger amount of established programs financing act funds this year than in the previous year.

HON. MR. CURTIS: Mr. Chairman, I wonder if I'm not constrained somewhat from answering that question because of legislation before the House. I look to the Chair for guidance.

MR. CHAIRMAN: The minister has indicated that we might be offending the rule of anticipation. However, perhaps the hon. member for Coquitlam-Moody could enlarge upon his question or rephrase it.

MR. ROSE: Well, it seems to me that all details concerning the amount of money this province receives in terms of income and expenditure are intended to be outlined within the budget. What I'm asking about, simply, is.... The income through transfer payments is received through EPF funding each year from the federal government. I know there's money going the other way because of the tax rental arrangement — that's what it used to be called in any event — so what I'm interested to know is whether or not the anticipated revenue in this budgetary year from the federal government through EPF will be increased. If so, the next question would be by how much.

MR. CHAIRMAN: The question, I guess, is in order if the minister feels it in order. However, there are other ministries that might be better prepared to answer that question, but the committee must leave that answer to the Minister of Finance.

HON. MR. CURTIS: It's a fine point, but there are those at the federal level of government who hold the view that a specific percentage of EPF is designated for health and a specific percentage is designated for post-secondary education. That was where I was having the difficulty, because it is a block transfer, and the legislation in front of the House deals with the health portion and the federal underfunding of EPE. I reject the argument — not that the member has advanced it — that when EPF was established, particularly for 1977, and renewed in 1982, there was a division between the money for health and the money for post-secondary education. It is a block transfer.

MR. ROSE: I fully understand that. On the one hand, the minister has told us that he rejects the idea that any part of EPF can be designated for health purposes, and then, just a moment ago — and in his budget — he made a great deal about the underfunding for health. It seems to me that the minister cannot have it both ways. I am not asking at this time what portion of the EPF goes for health or education; I'm asking if the total amount of transfer received from the federal government in transfer payments under EPF is larger in this reporting period or year than it was the year previous.

HON. MR. CURTIS: Mr. Chairman, we can continue that debate some other time, but I would refer the member to page 8 of the estimates, which shows under the heading "Contributions from the Federal Government" the 1983-84 estimated amount of $793 million, the revised forecast — because the member and the committee will know that it's a constantly fluctuating number, based on tax transfer and cash — of $935 million; and our estimate for 1984-85, the year which is now under debate in committee, on the same page under EPF, is $871 million. So blue book over blue book, the answer would be that the estimate is higher by some $78 million, but lower than the revised forecast for 1983-84.

MR. ROSE: Mr. Chairman, the estimated figure that I have received, through the kindness of the federal Minister of Finance, is $127 million, not $78 million. I wonder if the Minister of Finance of British Columbia sitting opposite us would help us clarify and reconcile the difference between these two estimates.

HON. MR. CURTIS: Mr. Chairman, I'll just pull some information in order to be completely accurate for the member and the committee. While I'm waiting I would say that I'm not sure that I would agree that the information provided by the federal Minister of Finance is done not as a act of

[ Page 3627 ]

kindness to anyone provincially but rather to support his case, one which even that member's associates in the province of Manitoba take issue with.

In order to save the committee time, Mr. Chairman, if the member will be here tomorrow I will undertake to have that information for him in our morning sitting. I don't have it readily available in the House this afternoon.

[4:30]

MR. ROSE: I would certainly be grateful for the accurate figures, because that is an extremely important basis for any discussion that we might have.

The part that concerns me is that the minister made much in his budget about the fact that B.C. has been deprived of certain funding by the new arrangements which took place in 1982. We all know that block funding under the EPF — with the congratulations and great enthusiasm of the provinces — was abandoned. Accountability for health and education was abandoned in 1977, with the support of the provinces. We are aware of that. The minister gave us a little history lesson here, and also — Mr. Chairman, I see you getting a bit edgy — in his budget. I don't think I am really skirting the bounds of good order.

In any event, the minister said in the budget that B.C. is being shortchanged because of a new formula in 1982. Over the years that's going to be true. I don't think there's any doubt about that. The feds have backed off in their contributions totally over the four years, and I think it amounts to about $3 billion or $4 billion across Canada, not in this province alone. But the case has been made that there will be $127 million coming to B.C. in addition to what we got last year.

I want the minister to tell me whether or not he agrees with that, because it has some profound implications for both Health and Education, which he has used and discussed in his budget, and now. It is block funding, and you don't have to account for it. It doesn't have to go to Health or Education, but the crucial question is that it was given originally for health and post-secondary education. If it is going directly to those two demands, that's one thing. If it is being diverted to something else in roads and sewers or coal-mines, that's quite another thing, especially when we are going to be asked in this legislation — and now I am anticipating — to provide the minister with the basis for taxing us 8 percent for health care.

MR. CHAIRMAN: Yes, that does offend the rule of anticipation. Further, as had to be pointed out to the member for West Vancouver–Howe Sound (Mr. Reynolds), we cannot reflect on a previous vote — namely, budget discussions. Administrative actions of the ministry are open for debate in this committee.

HON. MR. CURTIS: I believe my first reaction was correct, that the committee might be offending.... I believe it to be correct; the Chair, of course, will determine otherwise, I know. I find it difficult to discuss the amount of money which the federal government sends to the provinces without intruding into the debate which can be raised when we have the bill before us that speaks of federal under-funding and the necessities of provincial action to counteract that. That's the problem I have. I would like to speak at great length this afternoon on that subject. It is not just a question of B.C.; it is a question of all provinces. We are unanimous in this regard. I think, Mr. Chairman, that there will be an opportunity on one section of that bill — if not in second reading debate, then certainly in committee stage — where I may talk the member out of the House in terms of boring him. I have some very strong feelings, but I just don't think I can do it in debate on my estimates.

MR. CHAIRMAN: The point by the minister is well taken. Of course, it also follows that as this funding impacts on other ministries, there is another appropriate forum for that type of discussion. I am sure the member is aware of the concerns that the committee has. Please proceed.

MR. ROSE: I am certainly aware of the concerns the committee has, and I am certainly aware of the concerns that the minister has, and rightly so. I would ask the Chair, though, since part of this money goes to Health and that makes us run up against the rule of anticipation — suggesting that a discussion on the Health side of it would be better delayed until the bill is before us.... The minister does threaten to talk us all out of the House at that point.

HON. MR. CURTIS: Oh, no, just you, Mark.

MR. ROSE: Oh, I hope not for the same reason you were talked out of the House a moment ago.

Nevertheless I am quite sure that since part of those funds go to Education, and there is no post-secondary education bill before us, we are not defying the rule of anticipation. I wonder if the minister agrees then with the federal minister when he says that not only did the ministry or the government receive $2 million more this year than last year for what would traditionally have been pre-1977, pre–block funding post-secondary education fund, but in addition to that it was made even worse by the fact that the province and his ministry deprived the post-secondary education field of an additional $27 million. That means fees have to go up, courses have to be cut and teachers and profs in the colleges have to be fired. Does he agree or does he not agree with the Minister of Finance in that assertion?

HON. MR. CURTIS: Mr. Chairman, it is the federal Minister of Finance who made much of providing more money to the provinces, and at the December 7 or 8 meeting of federal and provincial Ministers of Finance and Treasurers in Montreal, I found it offensive to be one of ten recipients of a letter from the federal Minister of Finance saying: "Surprise! We're increasing the grant to the provinces under EPF." To the member, through you, Mr. Chairman, I was not alone in responding on behalf of the provinces to the ludicrous aspect of that "sudden money" — the windfall, which it has been described as. Certainly the Minister of Finance for Quebec and the Provincial Treasurer for Ontario and, I think, the Minister of Finance for Manitoba and others were offended by the fact that a formula produced more money than the federal government had anticipated. That's why I again refer to the revision that is shown here. It is a formula, Mr. Member. You understand that, and I am not suggesting that you don't. The federal government underestimated the product of the formula and then had the nerve, when the formula produced more money, to say: "Well, we've decided to give you more money."

If you have a formula, it's going to produce X, and they had estimated that it would produce X minus something. So that particular meeting, which dealt essentially with EPF, and

[ Page 3628 ]

within EPF essentially with health.... That's where we have our problem with anticipation, but let's just try to avoid it for the moment.

MR. ROSE: I'm not talking about health anymore. It's education.

HON. MR. CURTIS: Okay. The fact of the matter is that EPF money for health and post-secondary education is assigned to those purposes to a greater extent than the money that is actually received. It's a net loss situation for British Columbia, and for other provinces. The member said he hoped it didn't go for roads or sewers or whatever else. It certainly doesn't. It flows through consolidated revenue — through CRF — and then is expended for those purposes. One only needs to look at our expenditures in health and post-secondary education to realize that.

MR. ROSE: Well, that's precisely why I asked those questions. I think we needn't be surprised if suddenly more money is found at a certain period of time. I can remember — and you will remember too — that a lot more money, I think around $10 million, was found for education just before the last provincial election. But that's not the question. The question is that in total, yes, the funds are going to be down over the 1982 legislation.

HON. MR. CURTIS: And over '83-84.

MR. ROSE: Yes, but I'm quite sure that '83-84 or '84-85 is up $100 million or more over the previous year. That's the point I was trying to make, but that's one you're going to give me the details on tomorrow morning — that's what you promised me — because there was a difficulty in reconciling the figures of the Minister of Finance for Canada with the ones which I've been able to receive out of the budget. That's not the point. I agree it's down in total.

I have just a couple of short questions. The minister said he doesn't agree with the '82 formula. I could go into the history of what happened in '77 and why it happened, but again.... The minister spoke about boring the House. I don't want to try to win that championship, or take that cup away from him on that matter, but I want to know whether the minister wants to renegotiate EPF. If so, what would his intentions be other than just to receive more money out of EPF?

HON. MR. CURTIS: Mr. Chairman, I'd like to see a couple of things. First of all, I would like to see an end to unilateral activity under the EPF system, which was initially negotiated in '77 and renegotiated in '82. If I could, I would refer the member briefly to the historical reference that I made under the heading "Health Care Funding" — but it applies to EPF, to the block funding — starting on page 13 of the budget, and carrying on. I would like to see an end to the unilateral changes that Ottawa has taken recently. If we could turn the clock back to '77, I suppose we would find ways in which we could improve the original formula. In '82, of course, there were significant difficulties in the renegotiating period. The member nods his head in agreement. I happen to think that provincially, across the country, those views transcend partisan politics.

What would I like to see? I would like to see a renegotiation of EPF. I would like to see a clear commitment on the part of the federal government, and it is much more than just a question of more money. That is important, particularly when one analyzes the dramatic escalation in the costs of health care in this country; in debate on a bill I could speak about that. But it is far more important than just more money. It is predictability and stability and an understanding that both levels of government have a share in these particular activities — i.e., health care in all its forms, and post-secondary education — in terms of providing the dollars. I don't think that's too much to ask for, frankly. No more unilateral activities. No more "We've decided for these reasons to change the rules," and then in the case of health care, as an example, saying: "However, we want you provinces to take on more responsibility, you who are trying to starve the system." So an end to that kind of nonsense at the federal level, and then stability so that we can do our forecasting and assist the ultimate recipients of that money, whether it's federal or provincial in origin, and give them a degree of predictability and stability. I would think the member would agree with those goals.

MR. ROSE: Mr. Chairman, I agree that any recipient of funds from another source, in order to carry out proper planning, has to have some idea of how much money they will have over the short and longer runs. I don't have any problem with the minister there. The colleges in B.C. have that problem, though, because they don't know what they're going to get over the short and long run. They have the same need for that kind of planning data as does the ministry.

Interjection.

MR. ROSE: Right. They need it here, though, too. What you want from the federal government, Mr. Minister, through you, Mr. Chairman, is exactly what the colleges want from the ministry: to know where they are so that they can plan. I've got documents to show that that has been denied them up to now, and I hope that what's good for the goose, to coin a phrase....

One last question. The minister wants no more unilateral activities. He has told us he wants further to know what he's going to get out of the formula year by year so you have stability and predictability. Would the minister be prepared to return to the dollar-for-dollar accountability business which the government of the province was so anxious to abandon in 1977? You said it was non-partisan. As far as B.C. getting its share, it is non-partisan; certainly we want B.C. to have every cent due to it from the central government. I'm not standing up here trying to defend the actions of the federal minister or his predecessor — I spent long enough debating and fighting them not to suddenly want to switch sides some way and defend them — but the point is, as I see it, that when we did have accountability and a dollar-for-dollar federal-provincial sort of equation in the pot, the provinces were the ones most anxious to get rid of it. My party fought it on the grounds that the poorer provinces would divert money away from health care, because they felt they had their own priorities and they were short of money.

[4:45]

It turned out it wasn't the poorer provinces that did that; it was the rich provinces — the Ontarios, Albertas and British Columbias. If we had dollar-for-dollar funding and accountable funding — I know the accounting is very difficult — then everything would be out in the open, there would be no

[ Page 3629 ]

suspicions of federal money that was for education being diverted into roads, sewers or whatever, because then we would know because we would have an accounting of it. Will the minister in future negotiations of the problem be advocating a return to the accountability principle where the feds and the provinces will be charged dollar for dollar for post-secondary education and health?

HON. MR. CURTIS: Mr. Chairman, I don't think I would have tremendous difficulty with that, but I would want certain conditions very clearly laid down. The member in his remarks alluded to some of them. There is an attractiveness of fifty-cent dollars, and too often, I think, we start salivating when we're shown them. The member also nods in agreement on that: hey, it's only going to cost us, the provincial treasury, 50 cents to do a certain thing! If it were laid out very firmly and not subject to change, then I think it would be worth examining. EPF, Mr. Chairman, through you to the member, is an extremely complicated formula. I say that not putting myself in that elite group of those who fully understand it, which is quite an admission for a minister to make. My colleague, Jacques Parizeau in Quebec, has said a couple of times that there are probably only four or five people in the country who understand the entire formula that is known as EPF.

MR. ROSE: And Tommy Shoyoma is no longer around.

HON. MR. CURTIS: And Tommy Shoyoma is no longer with them; he is here. But I confess to this committee, I don't understand every single nuance, detail and factor in EPF transfers from the federal government to the province. I try, and every year I hope I pick up a little more, but I think that one of the things for which we should strive is an element of greater simplicity in that particular transfer process. That, I think, would assist not just those of us debating in a committee such as this or in the Parliament of Canada, but it would help the people who pay the bills at the federal and provincial level. It would help them as well, to say nothing of the recipients of the money which is generated — those who pay the bills and those who receive the money for a particular activity: health or post-secondary education. What the member has advanced, Mr. Chairman, is not something that I would strenuously resist and absolutely dismiss out of hand.

MR. ROSE: Would you advocate it?

HON. MR. CURTIS: Yes, I would be willing to consider advocacy, but I really want to watch my back every step of the way.

MR. ROSE: You have to now.

HON. MR. CURTIS: I agree. I would certainly want to be in a position where, in the final analysis, some wrinkle in the formula or some last-minute change at the federal level wasn't imposed upon us. The member might say: "You can certainly satisfy yourselves — you, the provinces — before you put pen to paper." But we saw that that didn't work in the past. So once bitten, twice shy.

We've got to have a better system. I don't pretend this afternoon in this capital city to have laid out all the ways in which the system can be improved. But first of all, if you sit down to have a friendly game of bridge, you at least want to be assured that the others are playing by the same rules. I think that's the major deficiency that we have. I refer again to the grand announcement in December in Montreal — here's more money for you — with nothing approaching an admission that the formula produced more money. The formula was there, the formula was in place, and it was going to produce so much money. Then to have the nerve to announce it as federal benevolence is insulting, I think, to all the people of Canada.

MR. PASSARELL: Mr. Chairman, I have about five constituency questions to address to the minister. Three of these you took as notice more or less. I don't think it was notice; it was during the last estimates, and you said you'd get back to me.

The first one was regarding the sales tax exemption for the northern communities that are on the B.C.-Yukon border. You said you'd get back to me regarding that. There was mention made in the budget speech regarding free ports, and I was wondering if something could be tied in for communities, as we addressed this problem earlier, like Atlin, where businesses are losing out to the Yukon because there is no sales tax in the Yukon and people are finding it's just as easy to drive 30 miles across the border to buy items. I know it's a very difficult situation, as my hon. friend from the East Kootenays speaks about individuals going into Alberta and doing the same type of thing. If something could be done to help the small businesses or individuals who are going across the border and picking up items that they could buy in B.C., but they're finding it's cheaper to buy in the Yukon — particularly because in Atlin there are no other surrounding communities — and they can go into Whitehorse and buy the same item....

The second question I addressed to the minister before was regarding tax exemptions on log homes, as they have in the state of Vermont in New England. Individuals who build with logs receive tax exemptions on their homes. Many of us in the north have to build our homes with logs, and I was wondering if there could be some kind of program for northern communities, and all through the province, with individuals who build homes with logs receiving some kind of tax break,

The third issue is the northern tax benefits. This is the federal program. I know the minister is meeting with his counterparts in the next few weeks regarding a first ministers' meeting on finance, if I'm not mistaken.... You're not? I thought there was a first ministers' meeting coming up.

HON. MR. CURTIS: Aboriginal.

MR. PASSARELL: Oh.

This is an ongoing problem, and the federal government's position is to stop the northern tax benefits received by northern employees regarding their tool allowances and so on. I would hope that the minister, in dealing with his colleagues in Ottawa, would give a strong endorsement to continue this program for northern workers in this province.

The fourth issue I'd like to address to the minister is in regard to gasoline taxes. We in the north pay approximately 20 percent more for gasoline than you do in the south. Where do these taxes collected by the service stations go to? Do they go right to general revenue, or is the tax based on the price of gasoline? If it is, then northern people and people who are

[ Page 3630 ]

living in isolated areas and paying higher prices for gasoline than in the south would be paying more in tax.

The last item I'd like to address is resource revenues. They're way down from last year. With so many mines, particularly in my riding, that are closed, how do you arrive at the figure that's in the budget for the whole year with regard to the revenues you're going to be getting from resources?

Those are five issues that I address to the minister. I know the first three were discussed in the last estimates and I think there could be some kind of a program, particularly with the log homes; it's really not a philosophical difference between our two political parties. The third one, northern tax benefits: all workers in the province would appreciate it if the provincial government would put some kind of pressure on the federal government to continue this worthwhile program. Those are the five constituency questions that I address to the minister.

HON. MR. CURTIS: Mr. Chairman, time flies when you're having fun. The member for Atlin is correct: I undertook to get back to him on a couple of things when we were discussing last year's estimates. That was five or six weeks ago, I think, with of course in the intervening period the production and presentation of a budget. So I don't blush. I would like to sit down with the member and discuss several of these matters; this is not to say that I can't speak of some of them now. When the member is ready to have a cup of coffee over some of these questions, then we can get into them in greater detail.

I have to say, though, that we have a problem — and I think this was the essence of the remarks in the debate on the estimates for the 1983-84 fiscal year — with respect to sales tax exemption when we move close to a political boundary — in your case, Mr. Member for Atlin, the Yukon and a reasonably sized market known as Whitehorse. I understand that. Similarly, the member for Kootenay (Mr. Segarty) has the problem with an easy run through the pass and into several communities in Alberta, and for other members of this House from north and south Peace River the easy run into Grande Prairie. On something such as motor vehicles — trailers, motor homes and so on — there is no problem, but we have had very strong representation from the merchants in Dawson Creek asking for a corridor. I think I did discuss this with you. If you did bring the corridor in, where would it stop? Would it stop at Dawson Creek or just outside Dawson Creek, or would it stop at Chetwynd?

Insofar as Alberta is concerned, I accept the inevitability of a sales tax in Alberta; I haven't been told that there will be one, but I would think that at some point, while many of us are still around, the province of Alberta will introduce a sales tax. That won't assist the business constituents of the member for Atlin (Mr. Passarell), but it will start to ease the problem along the eastern edge of British Columbia. I have also discussed this with two successive Ministers of Revenue for Saskatchewan, the present minister and his predecessor; as we all know, they have the problem right in Lloydminister. So that's a difficulty there.

[5:00]

Point No. 2, free ports or duty-free zones, is separate and distinct from the sales tax exemption matter. I think that would fall more appropriately under the estimates of the Minister of Industry and Small Business Development (Hon. Mr. Phillips), inasmuch as that responsibility will rest with him.

Log homes was one of the points made by the member for Atlin a few weeks ago which intrigued me. I would like to discuss that with him at greater length. Inevitably, though — and I know that often people hide behind the word "precedent," which doesn't bother me in every instance — others will suggest that a home constructed out of some other readily available material should be similarly treated. Well, that might be the second good reason. I undertake with the member at his convenience — I assume there will be a little longer period of time between the debate of these estimates and next year's.... I would be happy to discuss that with the member and with a couple of my officials. We can arrange that at almost any time.

The gasoline tax. Yes, I understand and accept the fact that the cost of gasoline is higher in areas such as that represented by the member. The tax, however, is a given number of cents per litre based on the price in Vancouver, so you are not paying more tax as a result of paying more for gasoline in your particular constituency.

The member noted that the resource revenue forecasts for 1984-85 were higher. The member mentioned mines; we're certainly looking at a package of increases. We expect that petroleum and natural gas will be marginally down and that minerals will be marginally up — that is, moving up from a pretty low base for 1983-84. We're looking for an increase in forestry. I'm pleased that it is a conservative increase that has been forecast, due to events of recent weeks, but I think that we're in a reasonably comfortable position with the marginal increase. The other major one is the indexed increase in water rentals, so the whole package shows a modest increase for 1984-85 over 1983-84.

MR. PASSARELL: Mr. Chairman, the minister forgot to mention the northern tax benefits — the federal government's program.

HON. MR. CURTIS: I'm sorry. Yes, Mr. Chairman, the meeting that is occurring this week — the first ministers' conference — is dealing with matters that do not relate directly to the Finance portfolio. It's the aboriginal meeting.

I would expect that this can be approached in two ways. Certainly the member will be making his own case with Ottawa, and has, I'm sure, already done so. I would be prepared to examine that in connection with other northern members, if I could be of any assistance in writing to the federal government. It can be diarized as an agenda item for the next federal-provincial meeting of Ministers of Finance and Revenue. But I don't know of any meeting planned. In the budget I called for a federal-provincial meeting on health, but again, the events of last week suggest that it may be rather difficult to tie down federal ministers for a conference with their provincial counterparts. But I undertake and commit to raise that when we next meet. In the meantime, if there is something that I can do, in concert with other northern MLAs as well as with the member for Atlin, I would be happy to do that.

MR. STUPICH: Mr. Chairman, with reference to the interim financial statements for the nine months ended December 31, 1983, I think one of the members commented in the House that this is a fairly new document to be prepared, but actually it has been going for quite some time. Formerly Public Accounts and the nine-month statement were prepared on a cash basis. I know now that on Public Accounts we have

[ Page 3631 ]

moved from a cash basis to an accrual basis, or at least partway. Unfortunately I don't have the right volume on Public Accounts here, and I can't read today's notes, but what I'm wondering is whether the comptroller-general's statement is still prepared on a cash basis or is on an accrual basis as well. I can wait if that answer is not immediately available.

HON. MR. CURTIS: I would think that it is prepared on an accrual basis, Mr. Chairman. I welcome the official Finance critic.

MR. STUPICH: Mr. Chairman, I thank the minister for his welcome. I note he says he "would think" it is on an accrual basis; I would think so too. But if he would find out for sure, tomorrow or anytime, I'd like to know someday what the basis is.

One of the concerns I have, and I voiced this on July 8 last year, is that the minister had grossly overestimated the deficit when it was estimated at $1.6 billion. The previous year I argued that the minister had grossly underestimated the deficit when he estimated it would be a break-even position. Some of the figures were so obviously in error, in my opinion, that I predicted there would be a deficit for the year ended March 31, 1983, and as it turned out, the deficit came out to almost a billion dollars. For the year ending March 1984 the minister predicted a deficit of $1.6 billion, and I argued that it was grossly overstated. Now in the budget the minister is saying that it was overstated to some extent and that the deficit is likely to be in the neighbourhood of $1.3 billion — some $300 million less than was estimated on July 7.

[Mr. Pelton in the chair.]

I don't think that is very good, in view of the fact that that budget was delivered in excess of three months after we were into the year. In my opinion, a pattern should have been developed by that time. I would think that the people in Finance, at least, could have done better than to have come that fair out from the mark. I believe it is still overstated. Of course we'll all have to wait — at least the opposition will have to wait — some time to find out just how far out it is. But the minister perhaps has a better figure even now.

With respect to the expenditures, I do have some questions. Some of them are a bit hard to follow, and perhaps the minister will have a ready explanation. One wonders whether the trails are crossed and there are divisions and intersections just to confuse people who might want to follow different documents, but I'll try it out and see if the minister can unravel some of the difficulties. He suggested earlier that I had been comparing apples and oranges in some of my questions. Let's see what happens today.

Still with respect to the expenditure — on page 2 of the interim financial statements — there are some ministries that would seem to be way out of line compared to the original estimate. I'd like to look first at the Ministry of Agriculture and Food, where the estimate was in excess of $82 million for the year, and in the first three-quarters of the year we have spent just over $25 million. If one took 75 percent of the original estimate, one would expect to spend $61 million. I know we can't do it that easily, and although we're on an accrual basis it still doesn't work that way. But if, in three-quarters of the year, we expected to spend $61 million and we've spent only $25 million, I wonder whether it means we're not going to spend that or whether the minister anticipates some heavy expenditures in the remaining three months of the year.

I want to ask the same questions with respect to Energy, Mines and Petroleum Resources, where once again it's substantially lower percentage-wise than one would expect for nine months. Environment is substantially lower than one would expect proportionately for nine months; Finance is far more than substantially lower. The estimate for Finance was almost $336 million. The amount spent in nine months was something less than $126 million. If it were on a straight proportionate basis, one would have expected to spend $250 million in nine months — twice as much as was spent. So there would seem to be close to a S125 million underexpenditure in nine months. As I say, Mr. Chairman, there may be a ready explanation.

I appreciate some of this may take a bit of working out, and I certainly wouldn't fault the minister if he wanted to come back on it tomorrow.

In Forests there would seem to be an underexpenditure, and it may be that there are heavy expenditures in February, March and April. I'd appreciate some information, but that's another ministry where it would seem the expenditures are low. In Labour, again, percentage-wise it's significant. The Provincial Secretary and Government Services is another one that I've marked as being lower in this period. I'm not particularly surprised at that one, because I believe that a lot of grants are paid out very near the end of the fiscal year when the ministry hurries up and pays out grants before March 31, lest the ministry lose access to that money and then doesn't get around to getting it out.

While the minister is thinking about those things, I'll just editorialize a bit more. The deficit for the nine-month period — and we are told that in all likelihood it's on an accrual basis — is $714 million. The minister does tell us in the budget speech that there are some heavier than normal expenditures coming up in the last three months of the year, but if one were to estimate that the experience for nine months will be repeated in the remaining three months of the year, then the deficit, rather than the $1.3 billion expected by the minister, would be about $950 million. Is the minister telling us that the experience in the remaining three months is going to be so bad that the deficit, instead of being $950 million, as one might calculate, is actually going to be $350 million more than that? The minister seems ready to make some comments.

HON. MR. CURTIS: Mr. Chairman, I think that some of the specific ministry expenditure patterns would be more appropriately dealt with in each minister's estimates. That is not to say that I will not give a general answer this afternoon, but perhaps it is preferable for, as an example, the Minister of Energy, Mines and Petroleum Resources (Hon. Mr. Rogers) to indicate why he has a heavier expenditure load in the last quarter of the year than in the first three-quarters of the year.

MR. STUPICH: Or indeed if he has.

HON. MR. CURTIS: Well, that leads to the point of the deficit. It is the general comment, Mr. Chairman, through you to the hon. member for Nanaimo, that the fourth quarter is, as the member would know, the particularly difficult one in terms of expenditure for the government for a variety of reasons, and some of them are not structured or planned.

[ Page 3632 ]

They simply occur in that way. That's the way in which the year flows. I don't suggest that the member has said this; indeed, he said quite the opposite. I've had to point out to one or two questioners that all quarters of the year are not identical in terms of revenue and expenditure. I'll use agriculture, for an example. I have suggested that it should be perhaps dealt with in other ministry estimates, but there is, I would believe, a higher payout occurring in the fourth quarter than in the other three quarters of the year. I use that only as an example.

[5:15]

The member started his remarks by indicating that the deficit was grossly overestimated in the July 7 budget. The point he made was that we were well into the year. Well, yes, it's correct that by the time the budget was delivered we had completed the first quarter of the 1983-84 fiscal year. However, the member would also readily admit that the completion of that budget, in terms of the revenue and expenditure numbers, occurred at some point in the latter part of May or early June. We would not yet have had the May results for certain revenues, i.e. sales tax, and so we were not as far into the fiscal year as the date July 7 might suggest.

I did explain in the budget debate and would repeat today that the reduced deficit is a source of satisfaction. We saw revenues come up as recovery commenced. We saw sales tax revenues improve to an extent greater than we had anticipated. I guess we can be faulted then, but we were putting this together in the depths of the recession, and one has to assign a percentage chance to pessimistic, likely and optimistic forecasts, and in the April-May-June period last year it was pretty difficult to find many who advocated the optimistic side of the ledger when forecasting the balance of that fiscal year in terms of revenue. Hindsight is great.

Of course the restraint program, on the expenditure side, continued to assist us, Mr. Chairman, in lowering the cost of government for the fiscal year. So when the two are put together, we see the improvement of some $300 million plus, and I'm sure that the member on the other side would welcome that reduced deficit, because we're still talking in the red. It's still a deficit, whether it's $1.6 billion or $1.3 billion. Where it will end finally, Mr. Chairman, for the fiscal year 1983-84, which we report on this summer, is something that I certainly.... I could hazard a guess, but it would only be that.

We see the forest industry difficulties, and that alone is impacting on revenues in a number of communities. If it is less than the forecast of $1.3 billion that was produced for budget day, February 20, then I'm sure all of us will be happy about that. But I can't tell the member where I think it will end up. It might be a little less than that $1.3 billion, but we still have the full month of.... I have no revenue figures for February yet, and of course here we are on March 5, so it's very difficult.

I summarize these remarks in response to the member's questions by pointing out that the last quarter of the fiscal year is the heavy one on the expenditure side.

MR. STUPICH: The minister says expenditures are coming in under. There was some reference to that in the budget, but the figures.... We have revised estimates for revenue, but I believe the estimates for expenditures are the original ones. Unless I've missed it in the budget, we don't have any detail at all of the expenditures coming in lower. It would seem to me that the total change in the net outlook is accounted for by the increase in revenue, which I said on July 8 would be substantially more. Since then economists from various universities, one who works for a credit union and various columnists, without reading my speech, have come to that conclusion entirely on their own. I think it's very clever of them six months later to find out on their own that I was right on July 8.

HON. MR. SCHROEDER: Were you right on July 8, 1975?

MR. STUPICH: I didn't make any predictions on July 8, 1975. I'm not sure what that's referring to.

The minister suggested that I ask the several ministers, and that's fair enough. Presumably he has had some general advice from them. In saying that he now calculates the deficit at $1.3 billion, he must have had some input. May I simply for a start ask, Mr. Chairman, whom I should ask about the substantial change in the Ministry of Finance? That's by far the biggest.

HON. MR. CURTIS: Mr. Chairman, the member has me. I have to answer, with respect to the substantial reduction — to use his adjective — in the Ministry of Finance. Yes, I shall answer that. In connection with the revised forecast on the expenditure side, may I refer the member to Table 1 of the budget, page 20. The point is that we cannot attribute the reduction in the deficit for 1983-84 fiscal year entirely to an increase in revenue, because while again we're speaking about huge sums — more than the member and I will ever see — they are relatively small sums in terms of the provincial budget. The budget estimate expenditure was $8,446,800,000, and the revised forecast in time for the preparation of this budget, in Table 1, was $8,410,000,000. So there was a reduction in expenditure which occurred as a result of the continuation of the restraint program.

The underexpenditure for the Ministry of Finance. A large part of this is attributable to a reduction in the interest on public debt. We were forecasting a particular percentage figure as being the one most likely to be....

MR. STUPICH: Do you mean rate?

HON. MR. CURTIS: Yes, the interest rate. I'm sorry, did I not say interest rate? Forgive me; my mistake.

So there were savings over the projected expenditure on the interest rate on the public debt, and this would be reflected in such things as the treasury bills — as an example only, because not all of our borrowing has been in fixed long-term instruments. A few basis points of reduction in treasury bill rate would have an impact on that.

Also a reduction in the contingencies. For 1983-84 I had some money in for fire suppression, in addition to the amount within the Ministry of Forests. I've taken the position that we shouldn't kid ourselves with respect to expensive fire fighting seasons. We shouldn't put in $10 or $10 million and hope that it rains through the summer where the trees grow. So we had money in the Ministry of Forests' vote as well as in contingencies. As the member will know and the committee will recall, as it scrapes the rust off its feet and legs, it was a fairly wet summer and a significant amount of money put in contingency for fire suppression was not needed.

[ Page 3633 ]

Those were the essential factors with respect to the Ministry of Finance. Certainly, interest rate on public debt.

MR. STUPICH: I'd like to go back just a bit. We were talking earlier about the forecasting of the deficit, and the minister said that in July he really didn't have that much information to go on. I would remind him that that was five months later in the fiscal periods than when the budget was produced this year, in February. It would seem to me that on that basis one would expect the March one to be far less reliable as a forecast than the one produced in July.

I would also remind the minister, when he tells us that he did not have the financial information for the month of June, that he did have it for April and May. Indeed, the budget of July 7 included interim financial statements for the first two months of the year. That is certainly far more information than any other Minister of Finance — or even this minister, for that matter — has ever had in the preparation of a budget in B.C. So it would seem to me that there is little excuse for its being as far out as it is.

With respect to Finance, I believe what I am hearing the minister say is that the amount being spent in his ministry in the first nine months is a reasonable proportion of what will be spent in the year, and we are likely to have an overprovision in Finance estimates of some $167 million — an underspending, if you like. So it seems as though there is a cushion in expenditures, with respect to his ministry alone, of some $160-odd million, which is more reason for me to believe that the deficit of $1.3 billion is still grossly overstated. The minister said....

Do you want to go now?

HON. MR. CURTIS: Mr. Chairman, I thank the member for letting me interject at this point. No, it is not correct to extrapolate that to significant savings. The savings which I spoke of in the Ministry of Finance, and I spent some time identifying two or three of the larger ones, have been taken into account in the revised forecast for 1984-85; so it is not an inflated figure. I was speaking particularly of contingencies rather than expenditure in the last quarter of the fiscal year 1983-84.

MR. STUPICH: I understand what the minister is saying; it is just that I disagree with him. If I can identify a number of ministries where it is obvious — apparently obvious at least — that they are going to come in significantly under the budget, and we know that the revenue is going to come in significantly over the budget, it seems to me the difference is much more than the $300 million that the minister had forecast as a reduction in the deficit, comparing the figure given a couple of weeks ago with that of last July.

Another point I want to make is that he attributes part of his or the government's success, or B.C.'s success, to the fact that there has been a reduction in expenditures, and he gave me the figures. I am not sure how closely you were listening, Mr. Chairman, but unless I'm wrong, the figures for reduction in expenditures are estimated to be some $36 million. Now that's a lot of money, and to quote the minister: "It is more than you or I will ever see." But $36 million in a budget of $8.41 billion is something like four-tenths of 1 percent. Is the minister telling us that for a saving of $36 million out of $8.4 billion we went through everything that we went through in the province of British Columbia in the past eight months? The budget and the attendant pieces of legislation — and all it is expected to save us is some $36 million? It's a lot of money, but only four-tenths of 1 percent of the projected expenditures. Mr. Chairman, if that's the case, I think B.C. would have been far better served had we spent the full amount of the budget, and more besides.

[5:30]

HON. MR. CURTIS: On that point, the member for Nanaimo and I clearly disagree. It would perhaps be appropriate if one were speaking only of fiscal '83-84 and fiscal '84-85, but quite clearly it goes beyond that. It goes before that and it follows after that.

It was in the summers of 1980 and 1981 that I imposed hiring freezes as the first crude measures of restraint. There was some fun when I used the term "crude instrument," but it was that because it was before the compensation stabilization program. It's the kind of quick reaction that one takes when one sees what's starting to happen in terms of revenue versus expenditures; or, more importantly, expenditures versus revenues. We started that process in 1980 and again in 1981, attempting to identify ways in which we could hold expenditure increases. With the introduction of compensation stabilization, for which I am responsible, Mr. Chairman.... So I guess the committee can discuss that office. We started that program in 1982 — two years ago last month. I would not like to be standing here defending my estimates and I would not like to have been here in the past couple of weeks debating the budget if we had not taken those steps. It is okay, Mr. Member, to take little photographs of a particular moment in time and say, "Your expenditures have only gone down this much," or "Your revenues have gone up that much." But I spoke in the budget of a multi-year plan, and that is essential. Obviously, the savings that are effected in the budget this year, the savings forecast in the Ministry of Finance, didn't suddenly occur as a result of July 7, 1983. I suppose what we have here, as we've had before.... It's the fifth time the member and I have debated my estimates.

Interjection.

HON. MR. CURTIS: I think it's the fifth year. Five years; it seems like 15, madam member.

AN HON. MEMBER: We're both getting older.

HON. MR. CURTIS: Getting older.

But we have a philosophical disagreement on that point. The member, I'm sure, will want to continue to express his view on it.

MR. STUPICH: Well, Mr. Chairman, just a little, I suppose. I don't want to belabour the point too much. The minister and I have done this before. Who was it who sat in the corner and pulled out a plum and said: "What a good boy am I"? I wasn't the one who referred to the $36 million; the minister referred to this as an accomplishment of last year's budget. He was the one who boasted about putting B.C. through everything that that government put the people of B.C. through. It has been estimated that every backward step they took, starting with the July 7 budget in total, could have been left in place. All of the programs they killed and all of the cutbacks they instituted could have been reinstituted for less than $100 million. Now the minister says it was worthwhile putting B.C. through what we were put through last

[ Page 3634 ]

year to effect a saving of four-tenths of one percent of its total projected expenditures. It was not worth it in my constituency; I'm not sure whether it was worth it in your constituency; and I'm not sure that it was worth it in any constituency in the province. We attracted worldwide attention to some terrible legislation, apparently all in the name of saving four-tenths of one percent of an $8.4 billion budget. However, the minister and I, I think, are not going to agree today. Perhaps when he retires he won't be so bound by what he feels he has to say today and he might admit the error of his ways, Mr. Chairman, but not today. I accept that.

I'd like to ask him a specific question. Perhaps he will again refer me to the minister, but I think in this case he has some responsibility. On the same page, under expenditures, the amount estimated for Industry and Small Business was $141 million for that ministry. The amount spent in nine months, which sounds reasonable, was $111 million. Then they come to the budget speech, and the figure is $49 million — I believe, by memory, it's on page 26. Industry and Small Business: $49.158 million. Now there is a discrepancy of at least $92 million. Again, I'm projecting, I suppose, in calculating nine months into a year. I just don't know where that other $100 million dollars.... Here are two sets of financial statements. Which one are we to regard with most favour? In which one are we to put most trust? I seek some guidance, Mr. Chairman.

HON. MR. CURTIS: Perhaps I could refer the member to the Ministry of Industry and Small Business Development; I think I should, since that estimate is yet to be presented to the Committee of Supply, and can be dealt with at that time.

I may not have explained fully the savings amount which the member for Nanaimo has spoken of. To paraphrase him, he said that B.C. was put through all of that for $36 million. That misses the point, if I may say so respectfully, because significant savings in expenditure were already....

Interjections.

HON. MR. CURTIS: Would you like to call this committee to order, Mr. Chairman? The member and I are trying to have a....

MR. CHAIRMAN: It certainly is a little bit disconcerting, hon. members. The Minister of Finance is answering questions, and I would request all hon. members to please, if they have to have little private meetings, either have them out in the hall or in voices which are inaudible.

HON. MR. CURTIS: Thank you, Mr. Chairman. I am sure that I will be voted "Mr. Popularity" in caucus tomorrow.

MR. STUPICH: Ministers of Finance usually are.

HON. MR. CURTIS: It goes with the job.

Mr. Chairman, we were on a serious point: the savings of $36 million were over and above that already built into the expenditure estimates for the fiscal year of 1983-84. It is not correct for the member to say that B.C. went through all of that — had all that difficulty and antagonism and animosity — just for $36 million. Those were additional savings that came in as a result of the continuation of the restraint program. We had already factored in major savings on the expenditure side in presenting the budget on July 7 last.

I am going to raise a new topic, Mr. Chairman.

MR. STUPICH: I'm not finished with the old one yet.

HON. MR. CURTIS: Well, I think that I might as well now, in that the member was not present in the House at question period today. Twice last week he posed questions which I think I would like to answer now, if the Chair permits, inasmuch as they deal with the Ministry of Finance in the context of fiscal agent for B.C. Railway. It may permit the member for Nanaimo to direct his questions to some other minister tomorrow, if I don't satisfy him today.

MR. STUPICH: Are you going to be here tomorrow?

HON. MR. CURTIS: I'll be here tomorrow. I hope to be here tomorrow, Mr. Chairman.

MRS. DAILLY: We all do!

HON. MR. CURTIS: We all do, but one never knows. There was a series of questions on two days last week regarding the Dease Lake extension of the British Columbia Railway. I reviewed what the member for Nanaimo said, looking at the Hansard Blues. He said:

"I have another question for the Minister of Finance. Again referring to the budget speech page 6, speaking about the debt of the BCR: "This debt was incurred to finance construction costs mainly on the Dease Lake extension, which cost more than $200 million." The latest financial statements for BCR show the total cost of the Dease Lake extension, including all the litigations and the settlements that were made, to be $98.2 million. Where did the figure of over $200 million come from?"

Mr. Chairman, I replied at that point that I thought perhaps the member was misinformed. The member for Nanaimo, again looking at the Blues, said:

"Mr. Speaker, I'll accept that answer. I'd like to ask the minister: am I misinformed by Public Accounts, or am I misinformed by the budget speech?"

Then I responded with the observation that the member was not; as he said earlier today, we spoke about apples and oranges, and apples and apples. I responded with the observation that the member was not comparing identical aspects of BCR operations.

Then, on Thursday, Mr. Chairman, the member returned to the topic and said that he had been trying for a few days to get an "apparent discrepancy" straightened out between the budget and BCR's financial statements. According to the Blues — and I won't read all of them — on a page that is identified as page "tape 680-1," the member referred to the budget speech and the statements for BCR.

I tried to convey to the member for Nanaimo then that there was no discrepancy between the dollars referred to in the budget and the latest 1982 BCR financial statements. The reason for the "apparent discrepancy" — and it is only apparent — is that the item on BCR's balance sheet of $98,020,000 represents the cost of the uncompleted and non-operating portions of the Dease Lake extension. The BCR, quite correctly in my view, shows this as a separate item,

[ Page 3635 ]

because it does not form part of the revenue-generating capital assets of the railway. The member may care to note that there is a note — note 5 — to the financial statements mentioning that this is only the cost of the uncompleted portion of the line. So in the budget speech I said that the full cost of the Dease Lake extension was more than $200 million, excluding the cost of interest during construction, accumulated losses, and before deduction of federal grants.

So we were talking of apples and oranges, Mr. Member, as far as I can see: the $200 million cost and $98 million shown separately on the B.C. Railway Company balance sheet — it is, by the way, included in the item headed "Property and Equipment" on the balance sheet. I'm sure that if the member wants additional details, he will raise them in these estimates, if that is appropriate, insofar as I have that responsibility as fiscal agent for the B.C. Railway — or we can exchange correspondence on it. But I thought that I would like to get that out of the way.

MR. STUPICH: I'm not that easily put aside from the line I was following a little earlier. May I just comment: it would seem to me that if the minister knew that when I first asked the question on Tuesday of last week he might, rather than teasing me at the time, have given me the answer then and might also have saved me from the necessity of getting several copies of the BCR statements going back a few years to find out for myself what happened. However, that's satisfactory; I know the explanation now.

However, I do want to make another reference to that $34 million. The budget expenditures for the year 1983-84 exceeded those for 1982-83 by something in excess of 16 percent, if one compares not the revised but the original estimates.

HON. MR. CURTIS: Blue book to blue book — is that your point?

[5:45]

MR. STUPICH: I think it was white. Was it blue?

HON. MR. CURTIS: No, but from year to year.

MR. STUPICH: Budget to budget.

That being the case, if the minister tells us that the saving was actually much more than $36 million, I wonder how much the increase would have been if there were not already substantial savings in expenditure built into the system. The minister tells us that the restraint program started working long before July 7 — or, in effect, April 1 because we're taking about April 1. So if he tells us that the expenditures for the year 1983-84 are going to be $36 million less than those estimated for the year starting April 1, 1983.... My argument was that it wasn't worthwhile putting B.C. through everything that it went through to save $36 million; his argument was that it actually saved more than that because the expenditures would have been estimated at a much higher figure. I wonder if he can tell us how much higher they would have been estimated. Would we have been looking at a 20 percent increase that year or a 25 percent increase in one year? I wonder if he has any idea — and we both agreed on what his government put B.C. through last year — how much saving was effected in total? I say $36 million wasn't worth it? How much was it?

HON. MR. CURTIS: Mr. Chairman, again, I wish we could get away from the reference to the $36 million. The member will have every right to stand up and say, "Well, you said it in your budget speech," but in fairness I think he's taking it out of context just a little. Among other achievements, I spoke of $36 million additional savings from the time the budget of July 7 was introduced. I think that's still something worthy of note. But the actual savings that were factored in by my colleagues and I in the preparation of the 1983-84 budget presented in July last year represent far more than $36 million. It was through that period, with the recession at its worst and with our revenue projections looking really quite dismal, when we understood that we had to cut expenditures. Of course, at that particular stage of the recession, with recovery still a very iffy thing, we also included the one shot of the major job-creation program in the 1983-84 budget. So I think, Mr. Chairman, that in fairness, if one is going to start looking at expenditure lifts expressed in percentage terms for 1982-83, 1983-84 and projected for 1984-85, then one is going to have to take a lot of factors into account and not just those which the member for Nanaimo has chosen to select this afternoon. It was much more than $36 million — that was just what happened after we had set our goals and established the spending patterns across government for fiscal 1983-84. We didn't rest at that point; we then continued.

Mr. Chairman, I move that the committee rise, report progress and ask leave to sit again.

Motion approved.

The House resumed; Mr. Speaker in the chair.

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

Hon. Mr. Chabot tabled the report on applications pertaining to the Public Service Labour Relations Act dealt with by the Labour Relations Board in 1983.

MR. SPEAKER: Hon. members, earlier today the hon. member for Alberni (Mr. Skelly) sought, pursuant to standing order 35, to move a motion for adjournment of the House on a matter of urgent public importance, namely the testing of the cruise missile over Canadian soil. In order to qualify under the provisions of standing order 35, matters raised thereunder must involve the administrative responsibility of the government. Matters for which another authority is immediately responsible cannot properly be raised under this order. May, sixteenth edition, page 373. Clearly, international agreements relating to the testing in question are solely within the ambit of federal jurisdiction and, therefore, offend the limitations prescribed by authorities quoted.

MR. SKELLY: On a point of order, Mr. Speaker, if Mr. Speaker read the motion, the motion stated that this Legislature ask the Prime Minister to suspend or to cancel the testing of the cruise missile system. Surely this Legislature has that power to petition other governments, and to ask other governments to do certain things.

MR. SPEAKER: Order, please. Clearly, while the hon. member may have a grievance, nonetheless the Chair is bound, under the provisions of standing order 35, to rule only

[ Page 3636 ]

on those provisions. While such debate may or may not be in order in another place, it is not in order under standing order 35, and the Chair so rules.

MR. SKELLY: Mr. Speaker, I ask leave to suspend the rules of the House to debate this motion at this time.

MR. SPEAKER: Order, hon. member. At this time the Chair has ruled on the matter. A motion cannot be entertained at this point in the proceedings.

MR. SKELLY: Is it not possible, Mr. Speaker, to ask leave to suspend the rules of the House to seek unanimous leave of the House?

MR. SPEAKER: Not at this time, hon. member.

Hon. Mr. Nielsen moved adjournment of the House.

Motion approved.

The House adjourned at 5:52 p.m.

Appendix

WRITTEN ANSWERS TO QUESTIONS

8 Mr. Reynolds asked the Hon. the Minister of Human Resources the following questions:

1. On July 27, did any members of the Public Service in the Ministry of Human Resources leave their positions to attend a rally at the Parliament Buildings, and if so, how many?

2. In reference to No. 1, how many of these public servants will be paid for: (a) the whole day and (b) for part of the day?

3. Will any money be saved by Government as a result of No. 2, and if so, how much?

The Hon. G. M. McCarthy replied as follows:

"1. It is not known how many employees of the Ministry of Human Resources actually attended the rally at the Parliament Buildings on July 27, 1983. However, 368 employees of the Ministry of Human Resources were away from work without authorization for part or all of the day in question.

"2. (a) None of these employees were paid for the whole day and (b) 231 of these employees were paid for part of the day.

"3. $19,273.72 in salaries were not paid to Ministry of Human Resources employees for July 27, 1983."

20 Mr. Reynolds asked the Hon. the Minister of Human Resources the following questions:

1. On August 10, did any members of the Public Service in the Ministry of Human Resources leave their positions to attend a rally at Empire Stadium, and if so, how many?

2. In reference to No. 1, how many of these public servants will be paid for: (a) the whole day and (b) for part of the day?

3. Will any money be saved by Government as a result of No. 2, and if so, how much?

The Hon. G. M. McCarthy replied as follows:

"1. It is not known how many employees of the Ministry of Human Resources actually attended the rally at Empire Stadium on August 10, 1983. However, 775 employees of the Ministry of Human Resources were away from work without authorization for part or all of the day in question.

"2. (a) None of these employees were paid for the whole day and (b) 20 of these employees were paid for part of the day.

"3. $72,051.28 in salaries were not paid to Ministry of Human Resources employees for August 10, 1983."