[ Page 5305 ]

CONTENTS

Oral Questions

Vancouver Island energy costs. Mr. Skelly –– 5305

University standards. Mr. Nicolson –– 5305

Possible cuts in ERDA funding. Mr. Williams –– 5306

Mr. Howard

Community involvement program. Ms. Brown –– 5306

Community college funding. Mr. Rose –– 5306

Kelowna-Vernon bypass. Mr. MacWilliam –– 5307

Provincial court judge. Mr. Macdonald –– 5307

Tabling Documents –– 5307

Budget debate

Mr. Kempf –– 5307

Mr. Rose –– 5309

Mr. Davis –– 5313

Mr. Nicolson –– 5316

Hon. Mr. Pelton –– 5319

Ms. Sanford –– 5321

Hon. Mr. Phillips –– 5323

Mr. Lank –– 5326

Appendix –– 5329

The House met at 2:06 p.m.

Prayers.

MR. ROSE: Mr. Speaker, it's my pleasure today to introduce in your gallery Mrs. Chris Taulu and a number of members of the Metro Education Association, which is a coalition of parents, teachers and trustees concerned about education. They are over here today to meet with the MLAs.

HON. MR. NIELSEN: I'd ask the House to welcome members of the Select Committee on Science and Technology for the Future from the Legislative Assembly of New Brunswick, accompanied by the Clerk of the House, Mr. David Peterson. I understand as well that our fellow Canadians from New Brunswick are not only investigating science and technology but that our Clerk of the House enjoyed his share of three cases of Atlantic lobster last evening.

MR. STRACHAN: Mr. Speaker, if all goes well, this September my wife and I will be celebrating our twenty-first wedding anniversary. By saying that, I'd like to introduce my best man from 21 years ago, Bill Forster, and his wife Ida, who are in the gallery today,

MRS. JOHNSTON: In the gallery today are some students from Trinity Western College in Fort Langley — soon to be known, hopefully, as Trinity Western University. I would ask the House to please welcome them.

MR. R. FRASER: Mr. Speaker, I would like to introduce Mr. Puri of the Link, a Vancouver newspaper. Would the House please make him welcome.

Oral Questions

VANCOUVER ISLAND ENERGY COSTS

MR. SKELLY: Mr. Speaker, in the absence of the Premier, perhaps I could address a question to the Minister of Energy. A week ago in Port Alberni the Association of Vancouver Island Municipalities withdrew its support for the Vancouver Island gas pipeline and moved instead to call for a reduction in electrical energy rates to equalize energy costs between gas service areas and areas outside the natural gas market. Has the minister decided to respect the wishes of the Vancouver Island municipalities and develop an alternative pricing policy which will equalize energy costs between gas service areas and those which have no access to natural gas?

HON. MR. ROGERS: First of all, they haven't contacted me. But for now the answer is no, and the answer for the future is in all likelihood no, but I'll give it consideration.

MR. SKELLY: A supplementary to the Minister of Energy. Is it consistent with the minister's definition of cooperation to provide gas to municipalities on Vancouver Island whether they want it or not?

HON. MR. ROGERS: Mr. Speaker, I would not force any municipality on Vancouver Island to take gas if the municipality didn't want it. However, there is this one caveat: people living in the municipality may want it, regardless of the political stripe of the person occupying the mayor's chair. Given the choice, they will vote with their pocketbooks and install gas.

MR. SKELLY: Supplementary to the minister. Would the minister be willing to conduct a referendum on Vancouver Island to ask people whether they would prefer lower electrical energy costs or natural gas with its added capital costs?

HON. MR. ROGERS: Number one, I'm not in the referendum business; and I don't believe referendums are appropriate. I believe your supposition is incorrect, and on that basis I don't think it would be appropriate.

UNIVERSITY STANDARDS

MR. NICOLSON: To the Minister of Universities, Science and Communications: the president of the Confederation of University Faculty Associations of B.C. has published a letter regarding the contents of a meeting held with the minister. Does the minister feel that B.C. has too many university faculty and students and that entrance standards should be raised to get rid of students who attend university for social reasons?

MR. SPEAKER: The member will not be surprised by a lengthy answer.

HON. MR. McGEER: No, Mr. Speaker, and as soon as we can find the man who gave that interview we're going to fire him. We're hunting all over the place to determine who in the ministry holds those views, but we haven't been able to discover such a person.

MR. NICOLSON: In view of the fact that the minister has now threatened legal action, is he prepared to table an affidavit regarding his version of the comments that he made during that meeting?

HON. MR. McGEER: We're still hunting for the culprit, Mr. Speaker. The letter to me was sent to Monday magazine, that paragon of investigative reporting, and Monday magazine then sent the letter to my office. We're now extending the investigation beyond the ministry right up to Monday magazine, but we'll certainly report to the House as soon as we can run down exactly who said those things.

MR. NICOLSON: Mr. Boyanowsky says he stands by the contents of his letter. He said that he's not just Socred-bashing, that he didn't make it up. He was accompanied by Dr. Gordon Shrimpton.

Why does the minister believe that every time somebody tries to engage in a meaningful dialogue on university education, he has to get into character assassination? Why does he have to undercut the credibility of people, whether it be the resignation of the president of the University of British Columbia or the well-intentioned visit from two of the leading educators in British Columbia?

[2:15]

HON. MR. McGEER: Mr. Speaker, I'm not trying to undercut anybody. As far as the former president of the University of British Columbia is concerned, I do nothing but

[ Page 5306 ]

thank him for his service to this province and wish him well in his new post.

With respect to my views on higher education, the ladies and gentlemen of the press are welcome at all times to come down and seek those views. As far as Monday magazine is concerned, when I suggested to them that they determine the views of myself and the ministry, they didn't have any space in their edition for those views. I leave that option open to Monday magazine and to the press. I'm delighted to give an interview at any time on these subjects.

POSSIBLE CUTS IN ERDA FUNDING

MR. WILLIAMS: In view of the absence of the Minister of Industry and Small Business Development (Hon. Mr. McClelland), a question to the Minister of Forests. Reports this weekend indicate that the ERDA agreement might well be reduced to $500 million. Can the minister advise whether he has carried on discussions with his colleague in terms of meeting the downsizing that the federal government appears to be considering for aid to British Columbia?

HON. MR. WATERLAND: Yes, I could so advise.

MR. WILLIAMS: Could the minister advise us whether a reduction in the proposed amounts is therefore acceptable in terms of the forestry subagreement?

HON. MR. WATERLAND: Mr. Speaker, no such discussions have taken place. As far as the British Columbia government is concerned, we are still seeking a $650 million agreement, and I have no information that anything other than that has been offered us.

MR. WILLIAMS: Could the minister advise whether he sees that as a priority amount within the spending and would argue for maintenance of the $300 million amount?

HON. MR. WATERLAND: The objective of the government of British Columbia has been stated many times in this Legislative Assembly. It has been stated publicly and has received wide press coverage. It is that the province of British Columbia is seeking a $650 million agreement with the federal government, $300 million of which will be a forestry agreement. We have not negotiated or discussed alternatives to that.

MR. HOWARD: A supplementary. I wonder if the minister could confirm that decisions made within his ministry are to the effect that of that amount of money, a limitation of $22 million will be placed upon expenditures in the first fiscal year.

HON. MR. WATERLAND: Mr. Speaker, the proposed agreement provides for, I believe, a first-year expenditure of $22 million, rising to $44 million the next year and $78 million for each of the three succeeding years.

COMMUNITY INVOLVEMENT PROGRAM

MS. BROWN: My question is to the Attorney-General and has to do with the very lengthy litigation which a number of disabled people had to go through in order to get the Ministry of Human Resources to pay their CIP — that $50 a month that they used to earn. What did it cost the government to pay for that lengthy legal attack on the disabled and the poor?

MR. SPEAKER: Order, please. Hon. member, even by stretching the rules of question period, such a question can hardly qualify under urgent importance — one that requires that amount of a figure. The member may wish to rephrase the question.

MS. BROWN: Is the Attorney-General able to tell this House how much money was involved in that case?

HON. MR. SMITH: Answering the second question instead of the abortive first question with the deceptive preamble, the answer is no.

MS. BROWN: Mr. Speaker, there are other sources which indicate that there was something in the neighbourhood of $80,000 involved. Can the Attorney-General confirm that it was at least $80,000.

HON. MR. SMITH: No, I cannot, Mr. Speaker.

COMMUNITY COLLEGE FUNDING

MR. ROSE: My question is to the Minister of Education. The ministry, according to the budget, has decided to withhold about $12.7 million of college funding for the community colleges in a fund — some people would call it a slush fund — to be controlled from the minister's office. I'd like to ask the minister: has the ministry yet determined how much of this fund will be required to meet severance payments in the programs directed for elimination by this government?

HON. MR. HEINRICH: Mr. Speaker, the amount of money has been placed within the budget. I concede that it is to be used at the discretion of the ministry. However, the funds are to be disbursed to the colleges in support of a number of programs which I'm sure those colleges wish to advance in their communities, depending on what the demands are and remembering that each of the colleges represents a certain regional area within the province.

With respect to the question of severance, I haven't even entertained that idea at the present time. Whether part of it will ever be used for that I honestly cannot answer, Mr. Speaker, but for the present, I have not even considered that particular item and the utilization of those funds for that specific purpose to which the member referred.

MR. ROSE: A supplementary, Mr. Speaker. I believe what I heard was the minister just confirming that it will be the minister who will control the distribution of these funds. Since the minister appointed all the members of the college boards, none of which are elected, why couldn't decisions about which programs are to be abolished and which programs are to be expanded be left up to those boards that were appointed by the minister?

HON. MR. HEINRICH: That's exactly what will happen. The ministry will be responsible for allocation of those funds, and they will go to each of the colleges. The amount that will go to each college will be totally dependent on the nature of

[ Page 5307 ]

the program that is going to be advanced. I presume certain programs will probably incur greater costs than others.

MR. ROSE: The minister said that the boards will distribute the funds but that the decisions were probably going to be left up to the minister. Has the ministry decided at this time whether any new programs will be funded from this source? If so, what are they?

HON. MR. HEINRICH: I will have to take that question as notice, because I do not have any specific details in mind. I think that it's a very valid question.

KELOWNA-VERNON BYPASS

MR. MacWILLIAM: I have a question to the Minister of Transportation and Highways. The Premier's announcement of the Coquihalla Highway project just prior to the by-election last fall included the construction of a Kelowna-Vernon bypass along the west side of Okanagan Lake. In your latest reannouncement, you made no mention of the proposed bypass. Will the minister please explain why the proposal for construction of the Kelowna-Vernon link has been deleted from recent announcements of accelerated phase 3 construction?

HON. A. FRASER: I assume that it is because it is not happening in 1985-86.

MR. MacWILLIAM: Will the minister assure the residents of Okanagan North that the construction of the Kelowna-Vernon link will be included in the construction plans, or is the minister holding off the promise for another election?

Interjections.

PROVINCIAL COURT JUDGE

MR. MACDONALD: I have a question to the Attorney-General. Judge John Davies of the Provincial Court of B.C. said that he could no longer work as a judge because of various factors which in his opinion rendered him incapable of being impartial. My question to the Attorney-General is: did he continue to be paid by your ministry during the period he said he couldn't work?

HON. MR. SMITH: I don't think he quite said that he couldn't work. I think he said that he couldn't adjudicate guilt and innocence in trials. [Laughter.] There is more to judging than that function, hon. member. During the period in which this justice declined to take trials, I understand that he administered caseloads in criminal court chambers in Vancouver and performed other duties. But a superior court judge has now made it clear that he can work in all respects, and I anticipate that he will do so. The answer to the question, however unartfully it was posed, would be yes.

I ask leave to make an introduction. Mr. Speaker.

Leave granted.

HON. MR. SMITH: In the gallery this afternoon are a number of students from Mount Douglas Senior Secondary School in my riding, with their teacher Mr. Skapa. They are French immersion students. I would ask the House to welcome them.

Hon. Mr. Pelton tabled answers to questions on the order paper. [See appendix.]

HON. MR. SMITH: Mr. Speaker, I wish to file a number of documents in compliance with statutory requirements: first, the consolidated financial statement of the British Columbia Steamship Company, which is growing good news for the taxpayers of this province and an indication of the able stewardship of my predecessor, the Minister of Transportation and Highways (Hon. A. Fraser); and second, the annual report of the Law Reform Commission of British Columbia, the thirteenth annual report of the Criminal Injury Compensation Act of British Columbia and the annual report of the B.C. Police Commission.

Orders of the Day

ON THE BUDGET
(continued debate)

MR. KEMPF: Mr. Speaker, as I was saying at adjournment on Friday, it is with the greatest of pleasure that I stand in my place to speak in favour of this budget. It is, in my mind, a northern budget. It is a budget designed to assist the business sector, both large and small. It’s a budget that will ultimately motivate that private sector to provide long-term employment, employment that is so badly needed in this province during these economic times.

Mr. Speaker, I know that the socialists opposite are against it. That was made quite clear by their critic on Friday, and it will probably be made clear over and over as speakers on their side of the House get up to speak in this budget debate. They had no time for the private sector during the short time that they were government in this province, and they have no time for the private sector now. They had no time for the private sector during those dark days of socialism in this province. Mr. Speaker, they haven't changed a bit. They haven't changed one iota since they were tossed from office in 1975.

[2:30]

[ Mr. Ree in the chair. ]

I heard the member for Nanaimo (Mr. Stupich) speak of Sweden, and I'll give you some statistics. He spoke of Sweden in his address on Friday. Sweden, that great, wonderful socialist experiment — and the member for Nanaimo, the NDP finance critic, spoke in glowing terms of what this democratic socialist economy was doing. Well, Mr. Speaker, I have done some research since Friday just to give this House and the people of this province something of an idea of what the NDP finance critic is advocating for British Columbia. I really wish I had more up-to-date figures, because these figures are a little out of date, and the picture is worse today than it is here.

Mr. Speaker, the average Swedish corporate income tax is 58 percent — and these figures are as of the end of 1983. The sales tax at the end of 1983 in Sweden — and this is what the NDP finance critic is advocating for British Columbia — the sales tax was 23.5 percent. Personal income taxes in Sweden are high also. A person earning $30,000 in Canadian dollars, to put it into perspective, would have to pay 20 percent

[ Page 5308 ]

national maximum income tax, in addition to an average of 30 percent in municipal income tax — clearly 50 percent, half of that income.

Mr. Speaker, by the end of 1983 the Swedish cost of living was up by 9.4 percent. B.C. during that same time had an increase of 5.5 percent.

AN HON. MEMBER: A Socred depression.

MR. KEMPF: Mr. Member, it gets worse; it gets much worse. By January 1985, the consumer prices had risen in the previous 12 months in Sweden by 7.3 percent, while in Canada they rose by 3.7 percent.

In the 12 months prior to October 1984, Sweden's gross national product rose only 1.95 percent, while Canada's rose 4.8 percent. In February 1985 — last month — the prime lending rate in Sweden was 14.5 percent, compared to 11 percent in Canada.

Mr. Speaker, between 1977 and 1984, Sweden's krona — their dollar — was devalued five times, or 45 percent. And that's what the finance critic for the socialists opposite advocates for British Columbia. In Sweden in 1983-84, 84.53 percent of total revenues was gained through taxes. I could go on and on.

If that's what the socialists opposite advocate for British Columbia, I would say to those people in the gallery today: go out and tell your friends, because that's what you'd have under an NDP government in British Columbia.

MR. NICOLSON: Yes, you'd have work — wages instead of welfare.

MR. KEMPF: Well, okay, you'd have work. How about the suicide rate in Sweden? It's three times what it is in Canada. They must be really happy in their work over there.

Interjections.

DEPUTY SPEAKER: Order, please. Would the member for Omineca address the Chair. All other members will have their opportunity to participate in the debate. They can stand in their place then and not speak from their chairs in the meantime.

MR. KEMPF: The finance critic of the NDP failed to tell the whole story. He failed purposely to tell what is really taking place in Sweden and what those socialists opposite would like to see for British Columbia. The headline says: "NDP Scores 'One-track' Budget." That may be so, Mr. Member, but at least it's on the right track; it isn't derailed the way Sweden's is. We don't need that kind of prosperity in British Columbia.

MR. MACDONALD: You were better before you joined the ministry.

MR. KEMPF: I'll get to you, Mr. Member.

We intend, through this budget — and many others to follow, I might say — to build our beautiful province and provide still more products for export. In so doing we will leave some of the fruits of the people's labour in their pockets so that they too might grow, prosper and reap the benefits of such success. We will not take it from them as the socialists would, and we will not seek to strip our citizens of their freedoms through state control. God knows, Mr. Speaker, we've got enough of that now in this province and in this country, and we sure don't need any more.

I remember the words of a former member of the NDP government when they were in power and back in this House after a lengthy paid holiday: "Bring them to their knees," he said. "You don't have to buy out private industry in order to attain state control; you simply bring them to their knees and take them over." I remember those days very clearly, because that is why I am here today.

That group over there, through their finance critic, advocate those very same things today. Nine years later they haven't learned a thing. Our budget moves in just the opposite direction: it provides tax reductions and incentives in order that the private sector might grow. Leave some jingle in their pockets in order that expansion may take place in this province. Through that expansion, in case you don't know, Mr. Leader of the Opposition, we get investment, development and jobs in British Columbia.

AN HON. MEMBER: Are you sure of that?

MR. KEMPF: Yes, I'm sure of that, Mr. Member. There is no greater force in the world than the power which can be harnessed through individual enterprise. It provides initiative instead of taking it away, as your government did in British Columbia when you were in power. Give the citizens of this province the will to want to make something of themselves and in the process create jobs for others.

Earlier I said that this budget was a northern budget, and I'll tell you why. Those northern members over there — and I don't see any of them in the House at the moment — won't have any trouble selling or explaining this budget to their constituents. I commend the member for Atlin (Mr. Passarell), who realized very early on in this House that the most important role of any member of this House is to represent his or her constituents. He'll support what is good for his constituents. You bet he will! We are here for those whom we represent, Mr. Speaker. The member for Atlin is one of the few on that side of the floor who seems to realize that.

It would be difficult for anyone, let alone northern members, to speak out against tax reductions and tax credits for small business. We all have small businesses in our areas. It will be difficult for any member of this House to speak out against a budget which reduces the tax of off-road motor fuel, a move which will assist many of our constituents — unless, that is, we wish to ignore the loggers, the truck haulers, the fishermen, or those in the aviation or mining industries who operate in our province. I have no trouble with it, Mr. Speaker, none whatsoever.

I've had a mine down in my constituency — and a community hurting for the last three-plus years now — at Fraser Lake.

MR. MITCHELL: Brought to their knees by the Social Credit.

MR. KEMPF: No, you can't say that, Mr. Member. And that's just how ignorant you are.

Mr. Speaker, the initiative in this budget, coupled with the legislation introduced last Friday providing the possibility of reduced hydro rates for such operations as Endako Mines, might just reopen that operation and give those

[ Page 5309 ]

miners jobs and their families new hope and anew future. I'm for that.

I'm for a budget which provides for tax reductions on machinery and equipment, reductions which will not only assist miners such as those at Endako but, as well, a multitude of existing and future industries and businesses in British Columbia. I'm for those reductions.

I'm for the reductions in the non-residential school tax for commercial and industrial properties, which on top of all the incentives I've mentioned before will give business and industry yet more initiative to build and grow and prosper — and provide long-term jobs in British Columbia. I can support those kinds of initiatives.

Even the socialists have seen some of the errors of their ways — very few, but some — and can support, as I have for some nine years now, fighting very hard, the abolition of the corporate capital tax which we see in this budget.

I can support all ten of the taxation measures for economic renewal as presented in this budget. But there's more, much more.

[2:45]

1 really wonder as I hear remarks attributed to those members opposite, and hear the remarks of the finance critic, whether they've really read the budget. It was brought down on Thursday last. It's now Monday. They've had a weekend. Have they really read that budget? It was clear, Mr. Speaker, in listening to the NDP finance critic on Friday, that he had not read the budget — not to that point, at least. The member for Comox laughs (Ms. Sanford) ; she should have been here to listen to it.

Had he read the budget the story would have been different. Unless, of course, for purposes of debate his debate was simply to oppose, and not to represent his constituents and other British Columbians. Perhaps he has no loggers or business people or industries or fishermen in the area he is elected to serve.

The initiatives in section VI of the budget, under the heading "Expenditure Policy," are clear initiatives which will be proven sound and fair — responsible stewardship of the resources of British Columbia on the part of government. There's a very significant line in one of those policy changes as alluded to in that budget. To quote from page 18: "The pricing policy for Crown land is also being reviewed, including lease rates for marina operators and agricultural land."

It is the wish of this government — certainly of this member — that people own land all over this province; that the people of British Columbia own British Columbia. I see the member for Atlin (Mr. Passarell) shaking his head in the affirmative, and I believe he believes that. I'm just sorry that many of his colleagues don't share his philosophy: the ownership of land by British Columbians. To make that easier and to make it happen, a serious took at the pricing policy for Crown land is long overdue and has to be undertaken. Now it's etched in stone in this budget. It will go a long way toward making the system more equitable.

Companion to this but unfortunately not seen in this budget is a subject which must be addressed immediately if we are to have development as sought by many of the initiatives in this year's budget — the agricultural land reserve. In most of rural British Columbia that piece of legislation is 100 years ahead of its time. It's a definite deterrent to the progress and development which create jobs. In my mind, Mr. Speaker, it has got to be addressed in the very near future. There never was, there isn't now, and there never will be, the  need for such detrimental, unfair, dictatorial, socialistic legislation in regard to land control north of the 51st parallel in this province.

Enough for today. I could go on and on speaking of the initiatives and the way in which this budget assists those British Columbians whom I represent in this chamber. I'll be addressing many of the issues coming out of the budget — and many of those issues in the companion legislation that will surely come forward in this House — in future debate on bills and on estimates. Suffice to say that I strongly, on behalf of the people of Omineca whom I represent, support this budget and look forward to voting in favour.

MR. ROSE: Mr. Speaker, I'm pleased that members of the Metro Education Association are in the gallery this afternoon to hear the speeches from my party, which are going to emphasize educational concerns this afternoon.

At the risk of being negative, because sometimes we are accused of being negative, it's my belief that government policies are a threat to the future of a great number of young British Columbians. I think the government doesn't understand that you're only young once, and the cuts to school services by the Social Credit government since 1982 by at least 25 percent, counting inflation, permanently damage the prospects of many children in British Columbia.

Over the past three years the government, if you count inflation plus cutbacks, has confiscated nearly $200 million out of the education budgets of the province. If you figure 12 percent inflation — and that's modest — and a 6 percent cutback in three years, to be redirected God knows where, they've stolen money from the educational system to a point where boards are saying: "No more. We can't stand it anymore. We've cut the fat. Now you're cutting the bones — the guts — out of the education system." What's worse, only about one-third of the districts bear the brunt; the larger proportion is being borne by those districts that hitherto had provided higher quality educational services than some of the others. So $200 million is taken out of one-third of the districts. But in the case of some of the other districts that apparently have had gains, such as Armstrong and Vernon — bigger gainers.... Those gains scarcely keep up with inflation, so they are really frozen at 1983 dollars.

In addition to facing cutbacks, the boards facing cutbacks face a legal bind. Let me outline it briefly. The Education (Interim) Finance Act specifies that the minister sets limits on budgets. The Compensation Stabilization Act empowers the commissioner to set levels at which a salary must be paid. The Public Sector Restraint Act says that an employer "may terminate the employment of an employee in accordance with the regulations." There are no regulations, Mr. Speaker, so school boards are effectively prohibited from laying off teachers. If the minister's budget is set at, say, $100, and the compensation stabilization commissioner requires salaries to consume $101, the boards cannot lay off teachers, because there are no regulations. Under those circumstances how can school boards be expected to obey the law? B.C. school trustees argue that the regulations under Bill 3 would be just band-aid and would create more problems than they solve.

What it means is that legislation to restore school board autonomy is essential.

The government of B.C. spent less on education in 1983 — that's the latest year for which we have any statistics available — than any other Canadian province. I've cited these figures before. In terms of the gross provincial product,

[ Page 5310 ]

B.C. spends 3.5 percent; the Canadian average is 5 percent. We spend 7.5 percent of personal income; the Canadian average is 9.4 percent. Ontario — another have province — spends 8.4 percent. B.C. spends 15.5 percent of its provincial budget, while the Canadian average is 21 percent and Ontario is 20.6 percent. So we in B.C. can well afford a better-quality education and better-quality financing.

I think that what the Social Credit government and the minister and the ministry fail to grasp is that those societies which make better use of their economic opportunities are those with a higher standard of education. It isn't just giving a tax break here or a little incentive there. Social Credit also fails to understand that during periods of economic downturn educated people are best able to deal with the consequences of unemployment. Let me cite you a few examples. A few years ago California was reeling from the effects of proposition 13. Last year it added 30 percent to its education budget. Why? Because skilled people refused to come to California because during those years they had an inadequate education system in certain areas, such as Silicon Valley. In Washington, according to their....

Interjection.

MR. ROSE: There's a lesson for B.C. In that.

In Washington the new governor, Gardner, supports an increase in the education budget. On January 9 the Seattle Post-Intelligencer said the state needs "a top-quality educational system in order to attract those industries."

HON. MR. HEINRICH: You're out of date, Mark.

MR. ROSE: So the minister found one paper to say that. I can find lots of papers that will contradict the minister.

By failing to appreciate the economic benefits of education, by their repeated attacks on schools and colleges and teachers and faculty and school trustees, the government is passing a very strong negative message about the value of education to all British Columbians, particularly young British Columbians. For the past three years the Social Credit government has been systematically browbeating trustees, scapegoating teachers and chiselling our kids. That's a fact, and that's why we've had more educational concern at this time than we've ever had in our history. No one can get away with that, regardless of how many newspaper clippings from California he found in the last 48 hours. If California had suddenly done a reverse over the previous year, then I think that would be California's bad luck, California's bad management. But we do know this: there are a great number of teachers here who are concerned and who have already sent job applications to California, where the system is expanding and not contracting.

I was talking about the value of education. Among young people from 16 to 24, the unemployment rate for those with post-secondary education is under 10 percent; without, over 20 percent. In other words, a person has twice the chance of a job if he has had some post-secondary education. The gap in earnings per year for those two groups is similarly startling: between $10,000 and $15,000 per year. So the negative message is reflected throughout the participation rate in B.C.'s post-secondary education system. It's the worst in Canada. In 1968 we were first among equals — equal with Ontario. Now we're 24 or 25 percent below the Canadian average. In B.C. In 1983 — the last year for which we have figures — there was one chance in ten of going on for post-secondary education. In Canada it's one chance in six. So you have a far better chance of getting post-secondary education if you leave B.C., and that's precisely what a lot of students are doing. They're knocking at the doors of universities and finding that they're closed. They're knocking at the doors of colleges and finding that they're closed as well.

Education should not be treated as a cost. It should be treated as an investment in the future. It should be available to an individual throughout his lifetime.

[3:00]

We've had a little bit of drum-beating called "Let's Talk About Schools." It asks questions about what our schools should be like, what the purpose of education is and how schools should be managed. A number of people have gone into detail about that, and I don't intend to today. Perhaps I will another time; perhaps in the estimates.

I think we should remind ourselves that most of the kids going to school today — in fact, all of them — will spend most of their lives in the twenty-first century, especially if they're going to elementary school. They're going to be living in the twenty-first century. So it seems to me, then, that the crucial question is: what kind of education is the most suitable for everyone's child — not just for the academically talented and academically competent, but for everybody's child; even for children of those people who pay taxes for universities and colleges but whose kids will never have a chance to go there? We know how the enrolment of schools and colleges are biased in favour of the well-to-do and those people who happen to be in the proper geographic setting where they live. There are some examples of that right around this room, but I won't go into the details of that either.

There are two kinds of broad views about what kind of skills people will need to function effectively in society in the future, but I think the budget fails to meet either need. One says that a school should provide for a few highly educated, specialized technocrats; the other — and this is the one that New Democrats prefer and support — is that the need will be for people with a high level of general education and a talent to be flexible. It's our belief that the budget fails on both grounds — the highly specialized technocrats because to obtain these people and these skills it's becoming so that you have to be almost independently wealthy in order to afford to go to schools and colleges.

We know that the province is kicking in, in terms of the universities, only 3.2 percent, while the feds are kicking in 80 percent and the kids are kicking in 16 percent. So as fees go up and the provincial contribution goes down, more and more will be demanded of those kids in terms of fees, and that will mean fewer courses, smaller programs, bigger classes and, certainly, higher fees. Fewer people will be able to attend, because fewer people will be able to afford to attend. That's a serious matter. The independently wealthy are not necessarily the people with talent; that wasn't the case in the past either, when I first went to university. Those people who were in shape to go, who lived close to the university and who were wealthy, had much better representation than the people like the minister and me — from Mission or some other, in those days, rather remote community.

The talented are in groups that are very underrepresented even today in the student population in colleges and universities: women, the disabled, handicapped, native people and mature students. Single parents, for example, are being ruled out of colleges and universities. They're being ruled out of

[ Page 5311 ]

colleges by the grant system, or the absence of it. My colleague will go into that in more detail.

Prof. Kazepides claims that "when crude utilitarianism prevails, the most sensitive and the most humane elements in the educational programs are sacrificed." What Prof. Kazepides means by that is that visual and performing arts are systematically being obliterated from our school system. They can't compete because of the new graduation requirements. There are going to be fewer and fewer music, art and drama programs, and this seems to be deliberate.

Yet it's ironic that the highest technical standards of any nation in the world are in Japan: they can all have had training and advance training on two musical instruments when they graduate from high school. What are we doing in terms of the humanities and the things that make us different, make us humane, in our schools? We're systematically obliterating those programs. We're crowding them out with demands for science and math, to the point where the kids are afraid to take the other subjects because they might be cut off at the heels, because the university requirements do not include those subjects.

The other thing that is possible is that we have a centralized school system. The reason that education faces, I think, a real crisis is the centralization that has gradually taken place under this ministry, the grabbing of power to be centralized in the bureaucracy of Victoria. It doesn't allow our community college boards to plan or our school boards to manage.

The Minister of Education has the power to direct local programs; we saw an example of that in question period today. He specifies what may be taught and what may not be taught under Bills 19 and 20 and under his graduation requirements. He does that; he has affected.... This minister has more power to control a school system than any other Minister of Education that I know of in western democracies. He's a very powerful man. I think his direction is wrong, and so is his philosophy. It's not that I don't appreciate that whenever I speak he comes to listen; I appreciate that with the minister.

Post-secondary colleges and institutes are in real difficulty in terms of what their mandate once was. The operating contributions to colleges are down by 5 percent to $240 million this year, except for the adjustment program, which is going to be used, in my view, not for new programs at all, but to pay termination for teachers and profs who are fired because programs have been abolished — like the business programs that were abolished last year and the hairdressing programs that were up for the slot again last year. The minister looks shocked, as if it comes as a surprise to him. It should come as no surprise to him; his ministry ordered it. He shouldn't have to take it as notice.

It depends on how much money is used to buy out contracts — I agree with the minister, it depends on that — whether we're going to get a cut in the services. But if it's used to buy out contracts, then the government's right on target. It's going to cut the colleges, with an effective 43 percent cut by 1988-89 over 1982.

1 talked about the student loan scheme. We've got a student loan scheme now that's going to be an average loan of $1,300 just to pay the tuition fee. I don't know why — as I asked him in the question period — the minister can't trust his own boards, which he appointed, to manage the colleges, rather than have a special fund which will permit him to direct what courses are to be on go and what courses on hold or stop.

1 think, as I said earlier, that the budget fails the generalists as well, because I think this business of the attack on students and on the colleges means that there are fewer and fewer options. Therefore, if there are fewer options, there is less opportunity to be a generalist. I've gone over the reason for that, too. The students have a tremendous hazard. They've got to get a job. They've got to be able to pay those fees. They can't get a student grant anymore. And in addition, they've got a new one; their courses might disappear before they finish them. Medical lab technicians at BCIT are an example. Architecture is on the hit list at UBC, plus 11 others. Pacific Rim studies at Langarra — going, going or gone. This is what's happening in our school system.

According to researchers Levin and Rumberger from Stanford: "The educational implications of high technology are that a solid basic education rather than narrow vocational preparation will become more important in the future" — not less important, but more important. "This will require elementary and secondary schools to strengthen virtually all their instructional offerings that require analytical and communicative skills."

Here's Raymond Williams, North Vancouver executive educator of the year. What's he got to say? He says that students trained for problem-solving and flexibility, not for specific jobs, should be our aim. "He advocates a broad range of learning, from science to fine arts, which he said develops different parts of the brain." I could quote him further, but I have to watch the clock, so I guess this final quotation will be enough. Williams is an outstanding man. To quote from the Sun, March 14, page A10: "'Career and Canada Manpower counsellors,' said Williams, 'are looking more favourably at liberal arts graduates than at specialists."' I could document this a lot more if I had more time. Nevertheless, I'd like to quote again from Rumberger, because I think it's really important as to what kinds of schools we're going to have in the future. Not just the crass meat-and-potatoes utilitarian schools that turn out kids for some dead end job, but schools that teach them to be critical and analytical, and that develop an educated person, not an indoctrinated person or a trained seal. That's not what education's all about. The minister should be designing a program to meet those needs, not cutting back on those opportunities — which his program is doing.

Again, Levin and Rumberger:

"Since we cannot predict in any precise sense which jobs will be available to particular persons, which jobs they will select from among those available, and what characteristics of jobs will be over a 40-year working life, it's best to provide students with a strong general education and an ability to adapt to a changing work environment. Such adaptation requires a sufficient store of information about culture, language, society and technology, as well as the ability to apply that information and acquire new knowledge. Accordingly, general academic and vocational preparation should be stressed, as opposed to specific training, especially for young students. Specific job skills can best be learned on the job, if a worker's general background is sufficient."

Then he goes on and parallels what Williams had to say — maybe Williams saw his paper; I don't know. Anyway, they're both saying the same thing. And they're both at odds with what the minister wants to do.

[ Page 5312 ]

Let me say a word about the independent schools. We see that their grants are up again this year by 16 percent to a massive $28.6 million. Half of this increase is accounted for by an increase in enrolments. We have to ask why. Are parents saying that it's because they can have an effective say in the independent schools and no longer have an effective say in the public schools? Because the school boards are merely there to take the flak. The real power rests in curriculum and finance with the minister. Maybe the independent schools can provide more responsiveness to the needs of the individual and his parent. So the school enrolments there are going up, because in the public schools they're shut off at the pass.

The other half of the budget increase is fiddling with the formula. Now for the first time, in order to base the formula on the previous years, we've included the teachers' pension contributions from the local school board. So that increases the formula.

Interjection.

MR. ROSE: Well, the minister denies it. That is my assertion. If he tells me it's wrong, then I'll accept his word, because I have other things that I can be critical of him about, but prevarication isn't one of them. He might not know, but he wouldn't lie.

I can understand very easily why the minister and the government favor independent schools. It's because he gets education on the cheap. Instead of paying out a dollar for the education of a youngster — a Canadian, a British Columbian — he pays 30 cents or maybe nine cents. It also favours the government's political friends.

The NDP supports choice in education. I don't think anybody would deny that the parent, over the state, should have the right of choice. Choice is fine, but a threat to the public school system such as is happening now is not fine. It's not fine, because people have to turn to other systems because their public school system's quality is perceived to be eroding. So we support the right of choice. But this party is never going to support the privatization of the public system.

Mr. Speaker, I think it's only fair to ask what our policy is — the NDP alternative in terms of education reconstruction. We propose that funds be restored to colleges and institutions and schools at their 1984 level plus inflation. We further propose that we would like to assess the damage caused by the government's abandonment of equal educational opportunity in the schools, and develop an orderly program of mitigating the worst effects of the government's policies. In other words, we wouldn't pursue the ham-handed approach that this government is taking to schools and to almost everything else that it touches.

Secondly, publish a new schools act and refer it to a select standing committee. Don't have people chase around on this make-work project called "Let's Talk About Schools" and then call it consultation. We don't support that kind of thing. We would give it to a committee of the Legislature, and we'd send that committee around the province to hear from people and then to report back in a public way to the Legislature.

To develop the $225,000 it'll cost you for "Let's Talk About Schools"....

AN HON. MEMBER: You'd break the taxpayers.

MR. ROSE: Never mind talking about breaking the taxpayers. You guys have broken the taxpayers, to a debt of about $14 billion.

We would like to develop a new funding mechanism that reflects a commitment to equal opportunity, equal access to educational services and an equitable share of financial professional resources and specialized programs on behalf of a demonstrated need.

Local participation and autonomy — which the school boards once had — so that within the framework of provincial goals, boards of school trustees have the right to set budgets to reflect locally-determined needs. That's why we're getting needs budgets. That's why at least 34 school boards have said: "No, your framework doesn't work for us. It's too chintzy, it's not equitable and it's unfair, and we would like to express what we would need on behalf of our people, the people we were elected to represent."

A tax burden based on the ability to pay. We accept McMath and that 75 percent be funded from general revenue. We in British Columbia have the largest proportion — nearly two-thirds — of school costs, which is far more than taxpayers in Alberta, Manitoba, Ontario or Saskatchewan. To reach the McMath target, we'll have to phase it in; no question about that. The minister doesn't agree with me, and he's squinting his eyes. I know that means he's thinking. Every time he squints his eyes, I know he's thinking.

[3:15]

AN HON. MEMBER: How do you know?

MR. ROSE: How can I say that? Sound research, that's how I can tell.

As far as the colleges and provincial institutes are concerned, Mr. Speaker, we want to put the "community" back in community college. We have not — this isn't new to the minister.... When we were debating bills 19 and 20 we called for a continuation not of appointed boards — you know, easily manipulated people who will take orders — but boards that are elected, even indirectly through the school boards, and that can respond to the needs of the community and will not take orders from the Kremlin in Victoria. We want a school board and college boards that are responsive and that have the autonomy which was taken away from them. It was confiscated.

We want to restore the community college boards and let them set their own budgets within a framework based on local taxation at 25 and 75. I see nothing wrong with that. I didn't see anything wrong with that when it was removed, but it was removed. So when the funding was centralized, so was the authority, ultimately.

We want them to deliver transfer programs. Mr. Speaker, at the same time that we're making the high schools more academic and cutting down on the options, we're limiting the university transfer programs in the community colleges, meaning that those people in remote and rural and northern areas represented by some of these people do not have the same options. Those kids will not be knocking at the doors of the university, so you can reduce the university budgets too and make them so restrictive that the only thing that will happen is that everybody will be paying for Dr. McGeer to do brain research. There will be nobody else around at all. He won't even be able to find a brain.

We want to restore to provincial institutions the ability to deliver programs. We don't want any $12.7 million slush

[ Page 5313 ]

funds. We think that just allows the minister to do things that he probably shouldn't do, because he doesn't know the needs as well as those people elected or even appointed to do that job in the community. We want them to be able to plan for orderly restoration of services, and that will require a sensitive, local and pragmatic administration.

Finally, we need a new educational system for the new society that we're going into in the twenty-first century. We need an educational system to equip people to think critically, to analyze accurately and to cope not only with the massive economic effects of the new technology, but with the social effects, which are going to be even more massive. The social effects of the new technology are going to be the new industrial and social revolution. We have to have people who are flexible, knowledgeable, critical, analytical and can cope with those changes, both at home and in the workplace.

MR. DAVIS: Mr. Speaker, I am going to speak in very general terms about the budget. It covers many important topics. I must congratulate the Minister of Finance (Hon. Mr. Curtis) on his presentation here in the House the other day. He put a brave face on what is a very worrisome situation not only here in this province but generally across Canada; indeed, in many other parts of the world at the present time.

We have a particular problem in British Columbia, essentially a product of world market developments and declining prices for raw and semi-processed materials. Those declining prices, plus some falling off in activity in our export industries, have resulted in a $1 billion shortfall in the income to the provincial treasury. That first occurred three years ago; we've had an approximate $1 billion shortfall from the resource industries to the provincial government in each year since, and it looks as if that situation will continue for another 12 months or so. A billion dollars is a large sum of money; it's the equivalent of 50,000 people working full-time. A drop in revenue of that order of magnitude, alongside a continued expansion in expenditures by the province for worthy people programs, has resulted in successive deficits. Generally speaking, this province has operated either on a balanced budget or in the black since the early 1950s. Beginning with 1981, we've seen a shortfall. We've been in the red in the order of $1 billion for several years, and it looks as if this situation may continue.

First, I would like to thank the Minister of Finance for several concessions. I've argued over a period of several years in the House for several changes, and most of them have been made in this budget, on a phased-in basis in several instances rather than overnight. While I'm saying that they're perhaps overdue, I'm glad these changes have in fact taken place. The capital corporation tax should have been removed earlier. It was a promise made by the Social Credit Party in the 1975, 1979 and 1983 elections. Now it's being achieved on a phased-in basis and will be complete, with one exception, three years from now. The exception is that the corporation capital tax is still to be paid by chartered banks with their headquarters outside of British Columbia. I will still argue that the capital corporation tax should be completely removed. I find it anomalous that the minister is on the one hand talking about attracting financial institutions to Vancouver, or conceivably to some free enterprise zones here on the west coast, and at the same time retains a capital corporation tax on banks and banking. That tax must be totally removed; otherwise, I doubt if this administration can be taken seriously in the area of financing export activities, import activities and so on, particularly financial activities based here in B.C.

The property tax on machinery and equipment is being phased out and the tax on new machinery and equipment is eliminated immediately. Those two taxes are, I believe, not only punitive on many capital- intensive industries — indeed, most industries — in the province, but again, tend to reduce profitability. Certainly they impact heavily on small business. Those taxes should have been removed, if for no other reason than that few other provincial jurisdictions have a tax of any kind on machinery and equipment. No U.S. state has a property tax on machinery and equipment. We should never have had one in the first place; we should have removed it long since.

Bringing the property tax yield on job-producing industries, commercial industrial activities, down to a reasonable relationship with property taxes on homes: a ratio of 2:1 is now the objective and should be achieved over the next few years. In other words, the tax on a given investment would only be double if it is commercial or industrial, compared to a home. I think that is worth while. In recent years the property tax level in British Columbia has been much higher than in the rest of Canada, and much higher on commercial and industrial businesses. Reducing it to a 2:1 ratio is, I believe, a positive step. It will help us to attract new industries, and it will certainly help existing industries to continue profitably into the future.

I believe it was British Conservative Prime Minister Benjamin Disraeli who said, when manhood suffrage was brought in in the United Kingdom in the 1880s: "We are all socialists now." His comment had some basis in fact. I think I can say with greater assurance that we're all welfare statistics today. It's a matter of degree, but certainly Canada and most western nations are, in varying degrees, welfare states. By welfare states I mean that many people — indeed, the great majority of the population — receive services free or nearly free; in other words, without themselves having directly to pay for them. The services appear costless or free, and therefore they use those services much as human beings the world over have always used those things that are free — wastefully. Welfare statism really means producing services, many of them vital, many of them essential — health services, education, welfare support — at no immediate upfront charge to the citizen.

It must have been distressing to a number of Canadian right-wingers — I'll call them conservatives — to hear our present Prime Minister Brian Mulroney finally embrace universality. Universality means that everyone is treated the same: everyone will get a given service without having to pay more than others, without having to pay directly for it, without knowing really what it costs. If you measure services provided nationally in that fashion, certainly Canada is a welfare state. Federally, the health program, the education programs and the social assistance programs are universal. They're available regardless of income or ability to pay. They're there if you're alive and breathing. Those services are paid for by others, often in ways that we don't totally understand, but by and large through income tax, corporation and otherwise, and through sales taxes of one kind or another.

Welfare statism typically sees deficits. If deficits are a measure of the degree of welfare statism we have in this country, then we really are a welfare state. Our national deficit is of the order of 30 percent. For every $100 of income to Ottawa, Ottawa spends $130. With this province's billion

[ Page 5314 ]

dollar shortfall, for every $100 of income we're currently spending $110. Provincially we're a 10-percent welfare state; nationally we're 30 percent.

There are several measures which I think are important, and I would like to see them in the documents that we receive when we're listening to the budget. It's always been the habit in Ottawa, at least for the last 20-odd years, to publish the current figures and the estimates for the next 12 months of the gross national product; in other words, the output of the nation. We do not receive figures on the gross provincial product from the Minister of Finance. He doesn't publish those numbers. I think they are very important, because you cannot measure provincial expenditure appropriately unless you know the total income of the province. You know what the provincial spending is; you don't know for sure what the provincial ability to pay is, in the sense of total income generated in the province in any given year.

[3:30]

In Canada we've seen a rise in the percentage of the gross national product that is taxed away from the people and spent by the central government. In my days in Ottawa, of the order of 16 or 17 percent of national income was spent by the central government; today, 22 or 23 percent of the substance of the nation is taken in by the national government and spent at the whim of, or certainly under the direction of, the government in Ottawa. Provincially we've seen an increase as well. In the late 1960s, in the order of 12 percent of the gross provincial product was taxed away by the provincial authorities and spent in a balanced budget: 12 percent in, 12 percent out. That was the order of magnitude.

When the NDP government was in, that figure rose steadily and reached 18 percent. In the next few years it tended to dip a percentage point or two, and I well remember the present Premier going east in 1979 and lecturing the nation on reducing government expenditure. He said at that time that government expenditure should be tailored — restrained, if you will — so that they did not increase annually at as fast a rate as the national output or, in our case, the provincial output. In other words, if the provincial output went up 1 percent, the increase in government should be less than that, and he said that ideally it should grow at least at one percentage point less than that of the total output of the economy.

But we've fallen on difficult times, and today in this province spending by the provincial government is of the order of 20 percent of the gross provincial product, which has to be the highest in the history of this province. It's spending beyond our ability to generate income. Admittedly we're spending a billion dollars more than our income. We're receiving $8 billion in tax and spending $9 billion. We're short a billion dollars. It's a shortfall, and it's a shortfall substantially because we are largely a welfare state in this province, because the great bulk of the spending — close to four out of every five dollars, close to 80 percent of all spending in the province — is directed to health, education and human resources. As the costs of those programs rise, so the deficit tends to increase. As long as national resource revenues are in the doldrums, we will continue to have a deficit.

Looking at the figures we've received in the publications, I'm left groping. I certainly would like to see a balanced budget long term. But I would like also to see a separation of current costs from capital costs. I would like to see a balanced budget when it comes to current — I'll call them operating or year-to-year — costs, and I would like to see the capital account balanced, but over a much longer term. Capital items should be written off over the economic life of the capital item. I'm enough of a Keynesian to believe — and indeed, certainly the record of the government is highly Keynesian, because it apparently believes in spending on capital during recessions — that it's possible to balance these capital items over the long run, but the key to it is having the capital items ready for execution when the slump occurs, carrying them out during the recession or period of restraint — restraint on current operating items — and recovering those costs over the longer term, over the long period when there are both good times and bad times.

The present government has several substantial capital projects underway. I would have preferred to have seen them picked out separately and in total, and costed not only as to their immediate cost of construction but also over the long term, including maintenance, and then the regime for recovering those charges over the long term. Taking that approach, I obviously support the Coquihalla Highway construction program. The timing is right. If you're going to build highways — certainly if you're going to spend a lot of money on bridges, throughways and so on — you should spend it now. You should spend it during periods when unemployment is up, when resource revenues are down, and when there are tens of thousands of construction and other workers otherwise idle. So the Coquihalla project fits.

I think the Annacis crossing over the Fraser — the four lane highway bridge from Surrey to New Westminster-Burnaby — should be built now, and it is being built now. I think the timing again is right.

Those two items — the Coquihalla item and the Annacis item — are well identified in the estimates submitted by the Minister of Finance and others. I really can't segregate the investment in light rapid transit. I would like to see what is being spent each year, in terms of capital, on that desirable project, and I would like to see it costed out over time. Again, I would like to see it in the capital budget, and I would like to see it clearly spelled out, not only as to how it's being costed currently during the construction and run-in phase, but also how the costs are likely to be recovered over the longer term.

Similarly with northeast coal. Northeast coal should have been clearly identified as a capital item, to the extent that the province regards it as a long-term investment. It should have been quantified fully, and its long-term recovery program laid out for all to see. The high hopes that some have for it may not be realized, or they may indeed be realized, but they should be spelled out so that future legislators and future Ministers of Finance — certainly future taxpayers — can see whether the project was well warranted or not. But it is a capital item, and it should be reported as such. It should, along with ALRT, be easily identified, and therefore the project better understood.

I think then, if we knew what those investment items were in the current budget, we might well find that a large part of what I've called a billion-dollar deficit would be accounted for, would disappear in the sense that current operating costs would come closer to the current income of the government. The $400-plus million turned over last year to B.C. Rail, so that B.C. Rail could itself pay off its old capital debt, was a capital item. That shouldn't, in my view, have been in the operating budget.

To repeat, we should have an operating budget and we should have a capital budget. The two should be seen separately. And more important from a budgetary point of view,

[ Page 5315 ]

the operating budget should be the one that's balanced in the short run, balanced each year. The other one should be an on-and-off budget, depending on whether we're in difficult times from an employment point of view, or jobs are readily available and the government can pull back and let the private sector drive the economy — as indeed it must, certainly in overall terms. But the government can act as the flywheel.

Where Keynes is basically criticized is that in real life governments are quick to spend, including spending on capital projects, but very slow to pull back when times improve. That's been the history generally throughout the English-speaking world and throughout western Europe. Perhaps it's human nature: it's easier to give than to penalize; it's easier to hand out funds and announce projects than it is to restrain or cut back or terminate, no matter how prosperous the economy seems. So in real life Keynes is wanting, but in theory Keynes is right. In fact, if you look at the books of this province and try to rationalize the numbers in front of us, you see that we're acting like Keynesians. We're certainly building capital projects at a time when I believe they should be built. Will we pull back on those projects when times improve? Hopefully the resource revenues will rise. Will we resist the temptation to go on spending in a big way?

One project I certainly would like to see completed is light rapid transit. I'd like to see it pushed across the Fraser River into Surrey — and, indeed, a wing into the Brunette exchange in Coquitlam — before the government stops spending in a big way on that form of public transportation. That project won't be genuinely economic unless (a) it crosses the Fraser, and (b) taps Coquitlam; in other words, taps the two main population growth areas in the lower mainland. But then there should be a pause, and that pause might last a decade or so; it should last at least until the next recession.

The Coquihalla Highway will be largely completed, at least in its first phase, before our economy fully recovers. Fine — then there should be a pause. I'd like to see more Coquihallas. If the toll charges pay them off early, well and good. I'd like to see a similar project, beginning perhaps in the 1990s, pushing a highway straight north from Vancouver, up through Pemberton and the upper reaches of the Bridge River and the Chilcotin, towards Prince George. Mr. Speaker, I'm sure you'd welcome a project like that. Its timing would be for sometime in the 1990s — the next recession, the next time for restraint.

Your capital budgets, then, would vary, depending on whether you're in a slump, when they'd be large, or in a boom, when they'd be restricted. You would have that flywheel effect. You would have the overall impact of government spending tending to offset the vicissitudes of the private sector.

The private sector must have more assurance, must have more encouragement. I wish that the government had seen its way fit to give Alcan whatever approvals Alcan needed to proceed with its massive project a couple of years ago. I look with some envy at Quebec. Quebec entered into an agreement with Pechiney of France several years ago. They now have a big aluminium development in that province, using what otherwise would have been surplus hydro power. It's nearing completion. Its job impact in the longer term, direct and indirect, is of the order of 20,000 persons. We would have done well to have had an Alcan project going now, nearing completion at least. It's a bigger scheme. It involves several communities. It involves a degree of fabrication of a high-tech metal, which aluminium really is, and it involves a corner of the province where typically there's been a lot of unemployment. Certainly there are many other opportunities if the population base up there grows. So there I see a missed opportunity.

I know there are those — especially environmentalists — who hate big corporations, even if they're headquartered elsewhere in Canada, and they would have opposed that project. There are those who are still very much concerned that the long-term contract which the Aluminium Company of Canada has with this province re water and water rental charges should never have been entered into. But Alcan views that contract as a great resource, which indeed it is. Very few metallurgical firms nowadays will launch a new project in this country unless they know they can contain their energy costs.

If you can enter into an agreement which allows you to develop water power or similar resource at your costs and you know that you will not be subject to some penalty at the whim of a government any time, you will likely proceed with that project. But you won't if you know that the water levies or charges can go up any amount. British Columbia sent a signal to the world: "Don't buy power for power-intensive industries in British Columbia, because we can change the water rental charge any time we want."

[3:45]

The only way to get metallurgical developments to the minerals in the north of this province is to make long-term commitments. It may be a limited hydro resource but a definitive one. That resource has to be contracted out to the entity which is going to carry on the development. Further processing isn't possible without it. Jobs aren't possible without it, certainly many jobs. So I believe that a fundamental policy decision has to be made. We have to go with particular developments in particular areas. If the resources are there, if the resources are going to be well-managed, if low-cost energy is one of the conditions of an industry getting going there, then I think the provincial administration has to face that fact and has to enter into agreements, admittedly on a smaller scale than the Alcan one, and has to give some assurance that it will ensure that the environment, etc., is looked after but in a reasonable way, with hearings with definite time limits and with costs and environmental protection costs — generally low anyway — fully identified, faced up to and then taken into account. Then we'll get industrial development.

Alcan is one example where I think we've missed the boat. The next time the aluminium market is improved, let's get on with it.

Liquefied natural gas out of Prince Rupert — partly from Alberta and partly from northeastern B.C. I think the province was right to make an early commitment as to an export surplus from this province, and I hope that project goes ahead. It's a matter of time. Perhaps it won't be until the 1990s. But there is another multi-billion dollar project — two or three billion dollar project. Alcan's development would be a two or three billion dollar project in its early phases.

The CNR and CPR are going to put large sums of money into their western transportation systems. They're proceeding. I hope nothing stands in their way in carrying out some massive investments which will provide many more jobs in B.C. In the next couple of years.

Finally, small hydro developments. I've already made mention of it, but I don't believe that where a private concern

[ Page 5316 ]

sees an opportunity to process a mineral or forest product, it should be denied the opportunity of harnessing a local waterfall or water power resource. I don't believe that B.C. Hydro, with all its vested interest, should be the referee in these cases. Indeed I don't think it should be called in to comment whatsoever. The province should independently assess what the costs and benefits of such a project are likely to be and act according to the results.

There were some danger signals in the address by the Minister of Finance. I don't like what he said about $2 billion of spending by several levels of government within the province, the inference being that that money should be directed to B.C. firms only — that outsiders shouldn't have a look in. It's certainly anti free trade, and it probably means that we won't get full value for all the dollars spent by our own provincial and municipal levels of government.

The critical industry czar idea: we'd all like to know more about that. Special employment zones: each of them runs in the same direction as many of the policy initiatives in Canada in recent years. They protect industries in trouble and look after zones which have a certain amount of unemployment. It's the opposite to reinforcing success; it's the opposite to going with winners. It tends to be defeatist; it tends to be protectionist; it tends to prop up companies, and certainly technology, on the way out. In the long term that is bad economics, not good economics.

Finally — I see my time is rapidly running out — in listening to the opposition I hear the familiar tune. I think that the two sides of the House can be separated, at least along these lines. The government side tend to be supply-siders; the opposition are definitely demand-siders. The opposition believes that by pumping more money out there, even if you haven't got it, and putting more money in the pockets of people who have to spend — particularly the poor and the disadvantaged.... That's the way to pull the economy out of a recession. The government side believes, in some degree, more in putting money into projects. I believe that with an open-sided economy like ours, demand pump-priming doesn't work.

MR. NICOLSON: Mr. Speaker, that was an interesting speech by the member for North Vancouver-Seymour — the independent member, perhaps, except when he gets up to vote.

Certainly I found some of his comments rather interesting, particularly his comment about water licence fees. It can be absolutely certain that the government's budget has done nothing to change the situation that existed a month ago as far as companies such as Cominco and others — who use cheap power in the refining process; at least, what used to be cheap power — are concerned. The budget really didn't take a step one way or another, and I think we have the worst of all possible worlds.

He spoke about the government having the third consecutive deficit budget; in fact, we have the sixth consecutive deficit budget. This is really the sixth consecutive deficit budget. This Minister of Finance has always spent more money than he has collected in revenues. He only managed to balance a budget, on paper, for the first three years by spending the money that had been judiciously saved by the previous Social Credit government of 1952 to 1972 and the New Democratic Party government of 1972-75, who saved over a billion dollars, which was squandered by this government during what should have been good economic times.

Certainly this is not a Keynesian or a neo-Keynesian government, but it is a government that I think.... In one respect they act as though they are neo-Keynesian economists; in another respect they act like they're neo-conservatives. They seem to adopt one measure one way. Certainly what is said for public consumption will be of one theory, and the actions that are taken by the government are something else.

When we see the way in which this government is staggering from crisis to crisis, it is clear that they have lost their compass, that they don't have direction. This government has taken us out of the international recession, which we were in 1982 when there was 12.1 percent of our people unemployed, and they have plunged us into the Social Credit recession of 1984-85, in which they put us into 13.5 percent unemployment. Currently the unadjusted unemployment rate in British Columbia is 16.4 percent.

Mr. Speaker, this is a bad budget. This is not a jobs budget; this budget is a slap in the face to the almost quarter of a million British Columbians who are presently unemployed. In addition, it is a slap in the face to the almost quarter of a million British Columbians on welfare who will probably never be employed. This is not the way out of the Social Credit recession. The way out of a Social Credit recession is a job-led recovery. That's the way they did it in Australia; that's the way they're doing it in New Zealand; that's the way they did it in Manitoba. That is the only way, so this government had better find a compass. They had better find some direction, and they had better stop stumbling from crisis to crisis.

Mr. Speaker, this government acts as if it believed in the words, of John Eatwell, an economist from Cambridge University, who commented, I think rather wryly: "If the world is not like the model, so much the worse for the world." This government does not want to face reality. They have this model. They've been stuck with this model ever since the likes of Mr. Kinsella, Mr. Spector and others were invited to join this government and, start directing it in 1979. This government has been stuck with a model, and the world and British Columbia are not like the model, so they say: "So much the worse for British Columbia." That is what is wrong in this province.

That is why we are facing the worst education crisis that has ever been visited probably in North America, and I would include the country of Mexico. This is the most backward step that has ever been taken in any part of North America. Others recognize that a university education through strong universities and colleges, and, indeed, a strong education system from K right through to post-doctoral work, is the real way to providing a strong economy.

The member who spoke previously talked about how things aren't too good in British Columbia because we're a resource-based economy. The reason we are a resource-based economy is because we have not stressed the type of development that is stabler and less subject to the vagaries of the international marketplace than is the simple extraction and export of raw materials. We haven't taken advantage of what I think are some very fine educational institutions that had risen to prominence, and even today manage to survive the vagaries of the current government. Today there has been a negative signal sent out which is reflected....

[ Page 5317 ]

For instance, I received a copy of a letter to the Minister of Universities from a gentleman in West Vancouver. He outlined in this his plans to consider enrolling in UBC's master of business administration program next September. He says:

"However, since the tuition costs will be 50 percent higher than anywhere else in Canada, the cost of living is higher, the local employment prospects weaker and the university quality, especially with regard to the exodus of our excellent professors, declining relative to that of other Canadian business schools, I am likely to move to Toronto to be educated and later employed. It is a shame, because I really love B.C., having been born and raised here."

That is, I think, the nexus of the problem that we face here in British Columbia. That should never have happened in a province that is so blessed and so strong in its basic attributes that it could survive good or bad governments, until this government came along, Mr. Speaker, and proved the exception to the rule — that one government could be so bad that even British Columbia couldn't survive it. It would never have entered a person's mind that he would have to leave a province like British Columbia and seek educational opportunities elsewhere in faculties that already existed here in B. C.

[4:00]

Mr. Speaker, we are making it more and more difficult for young people to participate in a university education. We have set up roadblocks and hurdles to post-secondary education. A young woman who represents the Canadian Federation of Students outlined to me her personal situation as a single-parent on welfare, She cannot attend university full time. She cannot even take a course load of three courses, or she disqualifies herself from receiving social assistance. But at the same time, unless you take more than three courses at a university, or the equivalent of three full-time courses, you cannot qualify for student assistance. These are the kinds of things which have created the most inequitable situation of any province in Canada. These are the kinds of actions that have taken our university situation in British Columbia from a position of number one in many instances to number ten in many instances.

Mr. Speaker, we have here in British Columbia a whole new change. The minister has decided that because high school enrolments are dropping — and his statistics show them dropping perhaps 8 or 10 percent — we have to start cutting back on our universities. But our universities have the lowest participation rate in all of Canada. Only 101 out of every 1,000 high school graduates go on to university in British Columbia — 25 percent less than the Canadian average. It would be 161 students, as compared to our 101, in the province of Ontario, with which we used to rank as number one back in 1969.

We are removing equity in education. That inequity is even greater in the case of non-metropolitan students, students who come from communities like Nelson or Prince George or Houston or Fort Nelson and from parts of Vancouver Island. They now participate at a rate of only about 7.5 percent. The gap is getting wider. The disparity and the inequity is growing. We are denying some of the best minds in this province the opportunity to participate in a university education.

[Mr. Ree in the chair.]

When I look and see what is put into this budget for universities — a $1 million scholarship program that works out to about $25 for every university student in this province.... It's called a loan remission program. What an inadequacy! What an insult! We have taken so much away from students. We are the only province in Canada that does not have unconditional grants for proven-need students. A graduate from the University of British Columbia comes out of school with a debt, if he has to take advantage of borrowing, of $22,000. The same student would graduate in Ontario with a debt of $5,000. I'm asked what's wrong with going into massive debt. Apparently, according to this government, nothing is wrong with going into massive debt.

Interjections.

MR. NICOLSON: I'll invite interjections from across the floor, because.... I want something for students in British Columbia — an opportunity that is at least as good as the opportunity that I had 20 years ago. I would certainly accept nothing less.

MR. PARKS: Did you have a student loan?

MR. NICOLSON: I certainly did not have to go into debt to get through university. Students in those days didn't have to do it. There were opportunities in those days. Times have changed. These people who think back to the days when they were kids in Vancouver, and Trout Lake and Lost Lagoon used to freeze over every winter in those days, and, "We used to ice skate, " and do this and that.... In fact that isn't the case. You look back fondly to those old days and say how wonderful they were, as the Minister of Universities (Hon. Mr. McGeer) tends to. But in fact, in those days it was very simple to get summer jobs. In those days it was very simple for anyone who had the motivation to go to university. But today the obstacles that are put in the way of a university education are almost impossible to overcome. It's a much more complex world and it's not the same.

The attitude of this government toward the universities is one which would channel everyone into a type of specific training. We even heard it in the budget speech. One of the few references to education was to training, with the clear inference being training for a very specific, very narrow field, which would probably become very limited in the very near future.

The successes which have been achieved at the University of British Columbia — successes in creating things such as the moly battery — were not.... That particular discovery was not a directed piece of research. It was an accident, and that is admitted by Dr. Rudi Haering — in fact bragged about by Dr. Haering. He points out how, had he been a chemist, for instance, he would never have made the discovery. It was only because by accident — one of his students mentioned this.... He had not been reading all the literature in this field. He had not been convinced by reading the literature that a lithium-molybdenum oxide battery was an impossibility. Therefore as a physicist he plunged ahead and actually created one. He then initiated research, only to find out that all the literature in the world of chemistry said that it was impossible. I mention that because this is way in which many very useful inventions are created. Yet this government seems to have an attitude that we must direct all research and

[ Page 5318 ]

that everything must have a very specific goal already in mind before it is embarked upon.

This government has a very negative attitude towards the universities. Any useful dissent in the community is met with by derision, by personal attack. The resignation of Dr. George Pedersen was treated by this government.... The minister immediately pointed out that he already had another job to go to, and that somehow demeaned the significance of what Dr. Petersen had to say. He takes issue with leaders of faculty associations who try to come up with some kind of basis for discussion. The minister has very glib remarks. The accounting of that particular discussion would seem to me to be consistent with what we read in Hansard of the minister's attitudes towards education and universities.

We have been led into a very difficult situation here in British Columbia. I think we must recognize that education is the best investment for the future that we can make in this province. For these young students that are in the universities today, this is their one opportunity of a lifetime. When we create this negative climate, it will be a scar that they will bear for the rest of their lives. We appear to be bent upon creating a lost generation here in British Columbia.

We're the only province where the university system is entirely financed by federal funds and student fees, with 2 percent from outside donations in the private sector. British Columbia has the lowest participation rate in Canada. I gave the figures earlier. Only 7 percent of grade 12 graduates from outside of the metropolitan areas of Vancouver and Victoria attend university, and only 16 percent in Vancouver and Victoria attend university. In other words, the participation rate in the metropolitan areas of B.C. is the same as it is for all of the province of Ontario. The participation rate for non-metropolitan areas in B.C. is less than half of what it is for the province of Ontario.

Our student summer employment program is the meanest program to students in the country. Back in 1975 there was $30 million for student summer employment. No student would go begging for a job back in 1975. In 1973 we geared up a program that delivered $10 million through meaningful employment to students; today we have less than that in our budget. We have gone so far back in terms of student summer employment that it's absolutely deplorable. It's only one third of the amount put up by the federal government, whereas Ontario is matching federal summer job funds dollar for dollar.

Only the B.C. government requires a student to undertake a $22,000 debt just to get a bachelor's degree. In Ontario a student in similar circumstances — one that would have to borrow their way through university — would incur a debt of just $5,000. In British Columbia student loans in 1985 will average $1,400, which is not even enough to cover a year's tuition fees. Tuition fees last year were up 33 percent. What else does government allow to increase at a rate of 33 percent, except hydro bills or telephone bills that they let go unchallenged? Certainly government is not recognizing.... They talk about an increased cost of living and various other things in this province, but it certainly isn't reflected in terms of student fees.

Then the other day there was another 10 percent increase in student fees. It was 33 percent last year, and a further 10 percent this year at UBC. Student fees and federal transfer payments are now carrying the entire load as far as funding our universities is concerned.

We allocate less of our wealth in gross domestic product for education than any other provincial government. In 1983 — the last year for which there are statistics — the current British Columbia government had education spending equalling 3.4 percent of our gross domestic product; the all-province average is 5 percent. British Columbia can well afford to support universities and colleges adequately; it really can't afford to do otherwise.

This province is now threatening academic freedom. It's becoming increasingly involved in the university budget allocations. Operating budgets are cut by 5 percent, but the reduced special slush fund will be used to support programs that the government thinks are important. It will also be used to pay severance in faculties that the government might think are threatening to them. There is so much orthodoxy running through the philosophy of this government that it is very alarming and very dangerous.

[4:15]

I'm going to mention something else, and that is that the salaries are now the lowest in Canada. Peter Lusztig, the head of the faculty of commerce, in which we are a leading faculty in all of North America.... Our graduate students, for instance, score in the 87 percentile in the GMAT tests, which are the standardized achievement tests for graduate students, administered at most universities in North America. But now we are losing that faculty. We are losing our competitive edge in but one of several faculties where British Columbia is North American class, or, in many other instances, the best in Canada. There has to be an alternative, and there is. We should make funding available to the universities to at least maintain the 1984 levels.

Federal funds received under the EPF funding should be earmarked for educational purposes, and the increases in the funding — anticipated to be 7.5 percent this year — should go directly to the purpose they were intended for.

We should also immediately reopen the David Thompson University Centre. There were more graduates from there getting jobs than there were from the faculty of engineering at the University of British Columbia. And that doesn't mean that we should stop graduating engineers; we shouldn't stop graduating writers, actors, rural education people and others as well.

We need strategic long-term planning, and that is the message that Dr. Pedersen had. Here we were three weeks away from the beginning of their fiscal year, and the University of British Columbia, the University of Victoria and Simon Fraser University didn't know what their budgets were going to be for the next year.

We recognize that there are arbitrary barriers that determine whether a student goes on to post-secondary education. It's a lifelong process, if a person wishes. The failure to equip British Columbians with the skills they will need to function in the twenty-first century will mean that whole generations will continue to be hewers of wood and drawers of water, figuratively. The top jobs will be filled by people from out of the province or from the privileged strata of society — as the minister suggested apparently to the heads of the faculty associations. British Columbians deserve the opportunity to compete and participate on equal terms with the rest of the people in Canada. The barriers to study are financial, geographical and cultural; they should and could be overcome.

The New Democratic Party believes that the province should aim at improving our participation rate from the present level of the worst in Canada to at least the national

[ Page 5319 ]

average, over five years. To meet this target we would restore the grant portion of the B.C. student assistance plan. We would review the maximum amount of the award annually and adjust it for inflation. We would deregulate the excessive criteria for student aid, and we would remove barriers for the participation of rural students seeking post-secondary education by developing a comprehensive strategy of decentralization, program delivery and boarding and travel assistance if attendance at urban centres is necessary or desired. We would increase opportunities and support for groups traditionally disadvantaged — women, single parents, mature students, cultural minorities, native people and the handicapped and disabled — and this would be achieved pragmatically by consulting with the educational community and representatives of the various organizations.

Mr. Speaker, what we need is a consultative process. This government has shown, even in this budget, that it is going to continue to legislate its solutions. For instance, in the field of municipal affairs it legislated without consultation, and then it brought all of the mayors and aldermen down here to tell them what we were going to do. That is not the way to run this province. If we get on with the proper process of consultation with our people, and if we listen to the needs of our people, we can pull this province out. Because British Columbia can do better. British Columbia deserves better. British Columbia will settle for nothing less than the best performance in British Columbia, particularly in education.

DEPUTY SPEAKER: Mr. Minister, the red light is stuck, as you may be aware. You will be warned two minutes before the time is up, if you speak so long.

HON. MR. PELTON: Thank you, Mr. Speaker.

I am very pleased today to give my support to this budget. I would like to begin by congratulating the Minister of Finance (Hon. Mr. Curtis) and his officials on a truly magnificent effort. We've been through the desert, and although we may not have crossed the River Jordan yet, from where we stand today we can see the promised land. And that's welcome news, because I can tell you that a lot of the camels have been getting mighty weary out there. So lest they pay attention to opposition claims that this is but a mirage, let's focus our binoculars on some of the orchards and minarets so that we go forward confident of our destination.

We began with a search inquiry into taxation in our province and into the burden it placed on our industries struggling to compete in the world economy. We opened up the process of the tax policy formation as never before, and we let the sun shine in. We invited and received many very worthwhile suggestions from business people and from other concerned citizens, all of them wanting to see more job creation and more job preservation in our province. Not all jobs can be saved, and not all jobs should be saved. We can't live in the era of the horse and buggy unless we want the world to pass us by. What we can do is create a climate in which our people are given the incentive and the encouragement to meet the competition of others in sectors of a world economy in which we can realistically hope to perform well in the long run. These proposals, together with the common areas of development potential which we identified in our umbrella agreement with the new federal government this past November, gave us an overview of where our economy was headed and of the measures needed to propel it forward.

Mr. Speaker, I would like particularly to compliment the Minister of Finance on the background paper which accompanies his budget, entitled "The Economy in a Changing World," and on the very helpful introductory remarks in his budget address. Together they provide the best framework I have seen to date for an understanding of our recent economic history and direction. I only wish that every British Columbian could read these, because I believe they are most useful in explaining the necessity for many of the very controversial steps taken by the government over the past few years and which have set the stage for this progressive and stimulative budget. They are very readable and very persuasive. I hope the Minister of Finance will continue in this vein. To build public confidence, government must be open, not only concerning its intentions, but also concerning its motivations and the thought processes which lie behind its measures, all the more so when. as in British Columbia, we have been breaking new ground and taking the lead in legislative initiatives to deal with fundamental structural changes in the world economy.

I'm pleased that the opposition presented an alternative throne speech. Perhaps they will also present an alternative budget so that the public can understand just exactly what their principles might mean in practice. I was quite distressed by the inward-looking nature of many of their proposals, which seemed to reflect a lack of confidence in our ability to meet foreign competition head on. While stimulating domestic purchasing power is a laudable aim, the relative lack of priority given to export development and the occurrence of anti-American and anti-Asian themes seem to demonstrate a fundamental blindness to the realities of our economic life and a regrettable dog-in-the-manger sort of attitude that could prove ruinous in our forest industry, our agricultural industry and our fledgling manufacturing sector, as they seek not only to penetrate new markets, but to keep vital existing markets open in the face of mounting pressures for protectionism.

Snarling at one's best customers and potential customers is no way to run a comer grocery store, let alone a province, and to my mind it is regrettable indeed that the leader of the opposition feels it necessary to play on people's fears of foreigners and envy of U.S. success in this fashion. I was frankly shocked. Certainly these jingoistic comments make B.C. no friends in the world, and indeed we need friends. Our working men and women depend on them. Our young people depend on those markets for our future, just as our elderly people depend on them for health care. It is truly irresponsible, particularly at this time when the Weaver bill is an active topic in the U.S. Congress, and as great a threat to our forest workers and their families' futures as they have ever had. Gratuitous attacks on our defence relationship with the United States only compound the alarming impression of negative stereotyped attitudes which are more reflexive than reflective.

Mr. Speaker, our budget is pro-labour, pro-worker. It's a pro-worker's family budget which reaches out to the entire world with a hand of friendship and commitment to work together as partners in progress, renewal, innovation and the pursuit of cooperation and excellence. We live in an imperfect world, and no doubt the fault to which pure capitalism falls most easily prone is that of greed. But the fault to which pure socialism succumbs is that of envy, a fault no more admirable and, I fear, one far more connected with failure than with success. We should not be envying the Americans

[ Page 5320 ]

or the West Germans or the Japanese. We should be striving to surpass them.

The member for Nanaimo (Mr. Stupich) has tried to convince us that tax relief is no way to create jobs. I can recall that not very long ago many people in this country and elsewhere were decrying the presumed evils of Reaganomics. I'm sure they began before the poor man was ever sworn into office. But they presume too much. These declarations remind me of the usually left-leaning U.S. cartoon strip in which one of the characters said: "I have some good news and some bad news. The good news is that unemployment is down. The bad news is that Reaganomics is working." Incentives work. The mainland Chinese, considering the severity of the cultural revolution, have discovered that. One might have thought that that message would have been a pretty profound one. So, Mr. Speaker, I appeal to all members of this House: let us stop snarling at our neighbours, our allies and our potential trading partners, and let us stop playing ideological games, which only harm our people and say more about the worst in us than the best in us.

While I'm on the subject of Americans, I do have a soft spot for their former president, Jimmy Carter. For all of the problems which he experienced, he was a man of humane vision. He used a phrase which I believe applies to all of us today when he asked: "Why not the best?" Why should we in British Columbia be satisfied with less? I simply don't buy it. Nothing we could do could make the member for Nanaimo happy. It is his job to be unhappy and he does his job very well — although I'm sure that in real life he is much happier than he allows himself to be in this rather theatrical process we all go through in this chamber.

[4:30]

[Mr. Strachan in the chair.]

The commitment to forest renewal is welcomed by all British Columbians. The commitment to secondary industry is music to our ears. Similarly the commitment to high technology is a sensible and progressive initiative. I have argued very strongly for a greater emphasis in our programs on relief to the small business sector, and I particularly wish to commend the minister on his decision to phase out the corporation capital tax — a stifling and repressive measure which should have been repealed in 1976. Likewise the small business tax credit is a very exciting initiative. But above all, I believe the abolition of property tax on new machinery and equipment will foster healthy growth and badly needed diversification throughout our economy. Skilled trades people stand to benefit most from this initiative, along with secondary industry in our province.

The scope of the new initiatives is rather awesome, and I will not even attempt to cover them all. I do wish to draw attention, however, to items relating to aquaculture and mariculture, since this, I know, is a topic of interest to members on both sides of the House. There is a significant list of sales tax exemptions for the industry, but this is not all. Aquaculture is also specifically included under the Industrial Development Incentive Act and would certainly be eligible for assistance under the Small Business Venture Capital Act. No less importantly, we are working very closely with Ottawa in this field of overlapping jurisdiction, and I am pleased to report that the federal minister, who also represents the good people of Vancouver South in the House of Commons, is extremely supportive of and cooperative in efforts to realize our potential as producers of seafood for a hungry world.

The lifestyle changes of the eighties and increasing fitness consciousness are continuing to enhance the desirability of this high-protein growth industry — if I may mix metaphors — and as Minister of Environment my philosophy will be to encourage the expanding production and harvest of both saltwater and freshwater food species. I'm sure that my colleague, the Minister of Agriculture and Food (Hon. Mr. Schroeder), will include a good representation of our fish, shellfish and similar products in his marketing initiatives at Expo and elsewhere.

Once again, I believe that vigorous marketing and a good-neighbour policy, as well as sensible regulations and cooperation with Ottawa, are key to expansion of this sector. The opposition would appear to favour small businesses only until they succeed and wish to expand. That is not our view. With over four billion mouths to feed on our planet, we believe that there's room not only for hobby-farm-scale operations but also for an expanding aquaculture and mariculture sector in our province, and for an expanding agricultural sector as well. Tax changes in this budget, combined with these new marketing initiatives, will help make that happen.

On the expenditure side education receives an impressive 5 percent. To some that's not enough, I know. But the government has given every school board in this province the vehicle to supplement local school budgets through reference to the residential tax base — by referendum. That is bringing government closer to the people — perhaps too close for some, Mr. Speaker. It is true that the residential tax base is not evenly distributed, but neither is the non-residential tax base. If our unemployment rate were considerably reduced, I would favour opening up that tax base for school purposes as well, but not at a time when we need so badly to create a climate of certainty and of confidence in known costs in order to attract new investment and encourage industrial and small business expansion in order to get our people back to work. It's always good politics to sock it to the employer. He's the bad guy — we all know it. But when he or she goes out of business, nobody gets any milk and cookies: not Grandma and not Little Red Riding Hood, not even Goldilocks and the Three Bears.

Mr. Speaker, I very much appreciated the Finance minister's remarks concerning EPF, because this issue has been the subject of endless self-serving comments by those whose higher education should permit them to know better. The past decade has seen a very substantial upward shift in the age composition of the Canadian population. Nowhere has that been more acutely felt than in British Columbia. The allocation of higher-than-average priority to health care is perfectly understandable in terms of the population mix in B.C. While I am a very great believer in the value of higher education, our number one spending priority remains health care for the sick and elderly of our province, and I make no apology for that.

We know that health care was not the number one spending priority of the opposition, as it is of ours. But I was rather astonished that in their alternate throne speech it seemed to have slipped to the status merely of a footnote or an afterthought. I believe it was a rather skimpy section 15, Mr. Speaker, a reflection, perhaps, of their own public opinion polling, which I understand shows that the public is quite satisfied with our outstanding health care system.

Mr. Speaker, I would like to congratulate negotiators on behalf of both the doctors and the transit workers on achieving very responsible proposals to assist in our economic renewal. Our new Minister of Labour (Hon. Mr. Segarty)

[ Page 5321 ]

knows what it is to be a union man and to support union principles, and he knows too that progressive and healthy cooperation is the ticket to success for working men and women. I am sure that he will be very effective in promoting that sense of common endeavour which we must establish if we are to succeed.

You know, Mr. Speaker, well over 80 percent of the construction jobs on Expo are union jobs. ALRT and northeast coal are over 90 percent. I am sure that if we had lost our nerve in the face of criticism by those who dare think small and had cancelled those projects, thousands of union members and their families would have been adversely affected.

If we had listened to the visionaries who were against the Peace, the Columbia and the Revelstoke dams, and the highways to the interior, the Roberts Bank, the Annacis crossing, the Ridley Island superport, the Anzak spur and every other solid investment in our province's economic infrastructure, many thousands more of our union families would be out of work, and indeed would never have had the opportunity to come to British Columbia in the first place.

If we had followed that philosophy over 100 years ago, when the opposition in Ottawa made similar arguments against Sir John A.'s transcontinental railway, I wonder if any of us in this House would be here or anywhere else for that matter.

Mr. Speaker, the member for Nanaimo accused us of putting all our eggs in one basket. If I thought he was right about that, I would agree with him that that would be a great mistake. But in view of the very wide scope of these proposals, I have a hard time believing that the member really had his heart in it.

There is direct public sector stimulus to construction through the Coquihalla acceleration and to high tech through the expanded funding for the very worthwhile Discovery Enterprise program. There is tax-based stimulus to secondary industry, which one would have thought the NDP would favor, considering their voluminous comments on the need for such stimulus over the years.

There is direct employment-related aid to small business through a small business tax credit program. Mr. Speaker, not very long ago I recall Mr. Ed Broadbent touring around the country saying that small business was the engine of economic recovery and that helping small business was the essence of his solution to the country's economic problems — or words to that effect.

Now I grant you that our small business tax credit program is not a socialist's dream. It does not involve a huge new bureaucracy to pick and choose among our small business. It helps all who qualify. Perhaps that is the problem that the NDP have with it, or perhaps it is just that we thought of it and they didn't. We have a venture capital program to provide incentives to our economy, and to become more progressive and more readily willing to undertake some reasonable risks. I would think that the member for Nelson-Creston (Mr. Nicolson), for one, would applaud such aims.

But that is not all. You know, Mr. Speaker, I recall reading that the second member for Vancouver East (Mr. Williams) wanted us to avoid putting all our eggs in the high tech basket. He wanted us to strengthen existing industries. That's exactly what we've done for forestry and mining with the machinery tax measures, industrial power discounts, the critical industries commissioner, the five-year water rental freeze, the new small business forest account. There is Expo 86, and parks upgrading, and abolition of the corporation capital tax — all of benefit to the tourist and hospitality industries, which he is directly familiar with.

Removal of the machinery tax will not be a burden on homeowners. If people take full advantage of these opportunities, the economic expansion produced could eventually ease everyone's tax burden, provided local governments and others learn the lessons of the past recession and avoid repeating the costly mistakes of ballooning bureaucracy and skyrocketing costs to the public. There is even something in this budget for the cigarette smoker: that is, a very good incentive to quit.

I was very impressed by the position announced by the hon. member for Atlin (Mr. Passarell), who is fed up with the games. In that he speaks not only for his independently minded constituency, but I'm sure for thousands upon thousands of British Columbians of every political hue, region, ethnic origin and sex. I would say both sexes, Mr. Speaker, but I don't want to leave anyone out. The member for Prince Rupert (Mr. Lea) is tired of games as well, and I in sure there are others. All but the most ideologically inviolate members of the opposition must realize that this is a great job-creation budget — a genuinely comprehensive and progressive approach to setting our economy on an upward path, with ample encouragement to our own people to do the job with a little help from our friends.

I invite all members to join me in supporting this outstanding tax-slashing, job-creating budget.

[4:45]

HON. MR. REYNOLDS: Mr. Speaker, I ask leave to make an introduction.

Leave granted.

HON. MR. REYNOLDS: It's a pleasure to introduce a Conservative member of Parliament for Kootenay West in British Columbia, Bob Brisco, who was at one time a colleague of the member for Skeena (Hon. Mr. Howard), the member for Coquitlam-Moody (Mr. Rose) and myself. It's a pleasure, and I hope the House will welcome him.

MS. SANFORD: The Minister of Environment (Hon. Mr. Pelton), who is now leaving the chamber, mentioned in his speech that he felt it was time to leave the era of the horse and buggy behind. I wanted to inform that minister before he left that the best way to leave that era behind is to ensure that we have a quality educational system in this province. Unfortunately, the budget under debate at this time does not make any provision for a quality system of education in British Columbia.

When we have a situation in the province where the government, through various moves, has gone out to destroy what was an excellent system of education, to demoralize the entire teaching staff of British Columbia, whether at the college or university level, or in the public school system itself, that alone ensures we will not have a quality educational system. People demoralized because of the attitude of the current government toward education means we have inflicted on British Columbia society a harm that is going to take years and years to repair.

It's a tragedy for everyone, not just those who are in the educational system today. Everyone is going to he responsible to pick up the pieces after this government is through with

[ Page 5322 ]

its wrecking-crew approach to the economy and to the various systems within the province, whether in human services, education or health. They are the ones who are going to have to shoulder the burden after the mismanagement of the economy through the approaches adopted by this government. They are the ones who will have to put the province together again once this current government is out. In order to do that, people will have to be well educated; they'll have to have a vision and some foresight. The only way we're going to achieve that is to ensure that the people of this province have a quality education and the opportunity to face the problems of this province. The problems are difficult enough without having the destructive approach taken by this government. We have difficult enough problems in terms of the environment and in terms of what is happening in technological change. We need people who have ability and foresight through the opportunity of a quality education.

Mr. Speaker, I'd like to point out what is happening in one small community as a result of the cutbacks in the budget to the community colleges at this time. Within the constituency of Comox and the community of Parksville, there is a Malaspina College campus which, unfortunately, because of the cutbacks in education, is going to close. The people who are currently employed there have been given their pink slips. The recommendation of the administration of Malaspina College, located in Nanaimo, to the board is that the entire campus be closed. The board has yet to make a decision on that. I don't see how they can keep that college campus open in any way, shape or form, based on the 5 percent cutback in community college funding. When you tie that in with inflation, the college campus is facing a cutback of about 9 percent.

The community of Parksville is in a difficult position financially. The unemployment rate in Parksville is no doubt higher than it is in many parts of the province. The line-ups at the food bank are similar to those in many other communities in this province. I'd like to point out what the closure of this campus will mean to Parksville. This kind of thing can be duplicated in every part of the province.

There is a base budget of $91,000 which is awarded to the campus at Parksville every year — $91,000 out of a $9.2 billion budget. On top of that $91,000, the community collects an additional $95,000 through fees. On top of that, there is some $60,000 that comes into that community through various federal and provincial grants to the Parksville campus of Malaspina College. The federal government, through programs like CIDA, has assisted financially in keeping various programs and operations and sponsoring conferences and things of that nature.

In addition to that, the college campus at Parksville has just negotiated federal moneys to the tune of $66,000 for a youth training option program, a program that serves as a link between school and the workplace for students, plus another $40,000 from the federal government to assist the students in travelling and other expenses that they would incur while they are involved in this youth training option. So there we have another $106,000 coming into Parksville — entirely federal money — which is now going to be lost because that college campus is going to close.

A program like the youth training option is beneficial to the businesses in Parksville. They welcome the students. They value their assistance and are pleased to be able to help in the training of young students as they adjust from school to the workplace. The students will suffer, and, of course, Parksville will lose $106,000 of additional money which comes directly from the federal government.

The people involved in developing programs at the Parksville campus have developed a unique program with respect to assisting mentally-handicapped adults. There are some 30 adults who now benefit from a number of programs that are offered through the community college, programs which enable them to take a place, through job training, in our economy. Those programs are going to be cut as well, of course. Those people currently benefiting from that program are not going to be able to attend the college campus at Nanaimo, because the course is not offered there. So there we have some 30 mentally handicapped adults who are going to be denied the opportunity of any kind of training, any kind of assistance in helping them in the workplace in the community of Parksville.

There's another program that has been developed through the college campus, an alternative program for students who are not able to survive in the school system. These are people who have special needs; some of them may be disabled. For the most part these are young people — although there are some adults who benefit from this program as well — who, for one reason or another, cannot fit in with the current educational system. The school board, with the assistance of the counsellors in that school, have developed a special program for them through the college. That too will be eliminated. What's going to happen to those students who cannot fit into the school system now, who are now denied the opportunity to develop and improve in such a way that they can fit into society? They're going to become the classic dropouts. They will be wandering the streets. They'll be looking for non-existent jobs. Unfortunately many of them will end up in the courts of the province, in the jails of the province. At what cost? What is the cost to keep one prisoner in jail for one year in British Columbia at this time — $40,000? We're talking about a total funding for the Parksville college campus of $91,000. Even under one small program now offered by that college campus, we might be able to prevent two or three people from ending up in the jails of the province. That alone would justify the $91,000 expenditure. It's ludicrous what the government is doing in terms of the priority it's placing on education.

I'd like to mention another program that has been developed through that college campus. We all know that the government decided two or three years ago that they could not afford to ensure that we had counsellors specially trained to give advice and assistance where sexual abuse had occurred. As a result, the Parksville college campus developed a program, in conjunction with the people at the Human Resources office in Parksville, to train and give assistance to volunteers who wished to do the kind of counselling that the government said they could no longer afford to provide. That program too will be down the drain as a result of this closure.

In addition, we have learned that the Ministry of Education is directing the board and the administration at Malaspina College in Nanaimo that certain cuts must be made, directed specifically to the college campus at Parksville. They have been told that they must do away with the lease arrangements that now exist at Parksville. I'd like this House to know that, through the kindness and concern of a businessman in Parksville, the lease which is now provided to the college campus is only $5,000, when elsewhere this same businessman could lease those premises for $15,000. So there is no justification whatsoever for the government to

[ Page 5323 ]

direct the Malaspina board to ensure that that lease is terminated.

The only thing the government is interested in is cutting back on education. It doesn't matter what it's going to cost in the future; all they want to ensure is that their pet priorities, the megaprojects of this province, will proceed, while mentally handicapped adults...while services that are provided to people in communities like Parksville are terminated. That's what's happening with the budget that has been introduced.

Parents are concerned. I've attended several meetings this year of concerned parents who are very disturbed at what's happening to their children within the school system. School superintendents are concerned, and issued a statement last year objecting to the priority placed by the current government on education. University people are concerned. We have seen the resignation of Dr. George Pedersen within the last couple of weeks.

[5:00]

We are losing top people from the university system, top people who are moving elsewhere where there are governments that have some concern and some interest in education. You can't blame talented professors for wanting to leave British Columbia today, with the attitude that exists on those government benches.

Teachers are disturbed and students are upset. Mr. Speaker, I know right now that there are university professors in this province who are advising students to go to universities outside of the province of British Columbia because they will get a better education. That's quite a condemnation of the priority and the willingness of this government to ensure that education receives the attention and the funding that it should.

Mr. Speaker, the approach of this government is destructive in the field of education. I don't know how long it's going to take to repair the damage that has already been done. We cannot afford to have this government continue to set the priorities that it has been setting over the last few years.

What their system of priority ensures is that British Columbia will remain at the bottom of all of the provinces not only in terms of educational opportunities but in terms of every other economic indicator that there is, whether it be in the area of unemployment, bankruptcies, investment or you name it. When you deny our people the opportunity to develop to their full potential through the educational system, then everyone suffers.

We need people to begin to turn this province around. Mr. Speaker, the damage which this budget does to the educational system alone is reason enough to oppose it, and I certainly oppose it.

[Mr. Ree in the chair.]

HON. MR. PHILLIPS: I'm happy to again take my place in this Legislature and support the budget, because the budget brought down last Thursday really presents a great time in history, a turning point where British Columbia again goes into high gear. We've come through the recession. Most of the other jurisdictions in Canada are still rumbling along in low gear, fumbling around because they didn't have the fuel in their tank from restraint that we conserved and were not able to get it going. So it's a great day for British Columbia, a great day for all of those who soak up the taxes of this province, and I refer to those in health care, those in education and those dispensing human services. This budget means that in the years ahead, when the economy grows, they can have more money and get back to the good old days. But in the meantime, I think they've been very cooperative in assisting us through the recession.

It was also another turning point, Mr. Speaker, last Thursday. We had heard about the new cooperative opposition, who were going to be constructive and cooperative. I guess that lasted for ten days, and as soon as the budget came down, that was a turning point for them. They turned, unfortunately, to their old ways of being negative, harping, carping critics, with not a good word to say for British Columbia, not a good word to say for Canada.

As a Canadian, it bothers me, Mr. Speaker, because we're looked upon by the world sometimes as being negative. The greatest country in the world, a country that was built by initiative and hard work, but you would think that we had turned around to be negative. I suppose that a lot of this comes from the opposition, because if you listen to the opposition, and if you listen to some of the news coverage of the opposition speeches, you would think that we were turning backwards, that we had nothing going in British Columbia. Instead of coming out and being positive and putting out some positive constructive criticism, which is needed.... We need constructive criticism, not the harping, negative criticism that we've heard so far on this budget.

I'll tell you, Mr. Speaker, Canada has a lot going for it. We have a good reputation abroad. We have the greatest country in the world, and the biggest problem we have in this country is the negativism of the socialists opposite — and when they supported the Liberals in Ottawa. That's what's the trouble with this country.

At a time when conservatism is sweeping the world, doing great things in Europe, doing great things for Thatcher in England, doing great things in the United States and on the march here in Canada, that old gang across the way is still buried in the 1930 politics, trying to separate Canadians and preaching the two-caste system. The greatest benefits to any society have been derived from the capitalist system in British Columbia, and that is what is returning. Who do you think brought in the greatest health services, the greatest education services and the greatest services for the people in need of any jurisdiction of anywhere in the world? I'll tell you: it was the capitalist system, not the socialist system.

That's why I'm so happy to stand here and support this budget today, because it's a turning point — another point back to the old system where we're going to give the producers in society a break. That's what this budget is all about.

The socialists over there want to keep taking it away, saying: "We know how best to spend your money. We'll take it all." They said they support some iffy-fairy study that was done in Ottawa that said that tax breaks such as were given in this budget don't create jobs. Oh, no. They're back to the same old policies of short fixes and throwing money at every problem and thinking that it will solve it.

Well, this time it isn't going to work, because this is a fine budget and, as I said the other day in my comments on the throne speech, this budget will make British Columbia industries more competitive so that we can go out there in that rough, tough, international marketplace and compete. We don't need the government to take their profits and tell them how to spend it. We don't need the government to take all

[ Page 5324 ]

their money and give it back to them on programs — although we're still doing some of that.

We're still doing some of it, yes. The only reason we're doing it is because of the banking system. If the banking system in this country took the risks that they should take with the small business community, there wouldn't be a need for the British Columbia Development Corporation, for ERDA and for all of these programs. But the banking system doesn't, so we recognize the situation we're in. We don't control the banking system. But I'll tell you, Mr. Speaker, again....

MR. LAUK: You sure defended them a couple of years ago.

HON. MR. PHILLIPS: That's just because you were attacking them in an unfair manner, my friend, that's all. I'm not attacking them; I'm making a statement of fact — there is a lot of difference, you know. There is a lot of difference between attacking the system and making a statement of fact.

Canadians are starting to be positive again. I can feel it everywhere I go. I can feel it in the business people who are coming in. That change has come about because of an election last September. Again we have a government that wants to support the entrepreneurs, because without supporting the entrepreneurs there will be no funds for all of those great social programs — which I support. But you've got to be careful. You can't look after people from the cradle to the grave. You've got to walk that fine line between doing away with the initiative and still preserving it, because if you give them too much, you do away with it.

The second member for Vancouver Centre (Mr. Lauk) a moment ago said: "Oh, yes, entrepreneurs with a $35 billion budget." I want to tell you that we wouldn't be worried today about finding enough money in Ottawa for the ERDA programs if in 1982, when we were in Ottawa, the federal government had done what we asked them to do and gone on a period of restraint. No, no. "You British Columbians are way off base. We'll hang you out on the line. You won't last very long anyway." If Ottawa had done that we wouldn't be faced with the problems we have today. Neither would any other jurisdiction in British Columbia.

I want to tell you, Mr. Speaker....

Interjections.

HON. MR. PHILLIPS: No, we wouldn't have the problems today.

If we had the money or even just a small portion of the money that we used to pay the interest on the debt and to pay the principa.... And most of those programs were supported by the NDP; the NDP has supported the Liberals for decades, we know that. There's very little difference between the NDP and the Liberals. Maybe the Liberals are NDPs in a hurry — I think that's what I used to say in here. But just think of the position Canada would be in today if we had just exercised a small amount of restraint, like we did here in British Columbia.

We've heard a lot in this Legislature from the NDP about education, because the NDP are not really prone to be too critical of some aspects of the budget, so they ride off on what they think are political horses. Here is the political horse of education, so they've jumped on its back and they're riding it to death. You did the same thing with health care three or four years ago; you would have had every British Columbian believing that health care in this province was going to hell in a handbasket. We have the finest health care today, and we had it then, but every time they bring something up. They're doing the same thing with education today; they'll ride it to death.

Three years from now they'll be sorry, but we'll have forgotten about it. The education system will be intact, and it will be a better system than it is today. When the numbers of people going into school are declining and the cost to the taxpayer is going up, where is the money being spent? You know where: on administration, not in the classroom. All it takes is a grade 12 student from North Vancouver to tell you what is going on, but, oh, they'll ride this political hobbyhorse just as long as they can eke any political stuff out of it. They're smart politicians, and I guess that's the way it is. But it's doing British Columbia damage, and if you're going to be good Canadians and help us out of this recession, it's time you got off that and started being constructive in your criticism.

[5:15]

AN HON. MEMBER: Calm down!

HON. MR. PHILLIPS: I'm calm, my friend, but you fellows over there excite me. As a Canadian who is working for the future good of this country, how can you do what you're doing? You're not doing it as Canadians; you're doing it because of cheap partisan politics.

I said in this Legislature the other day that there were 23,000 more people employed in February 1985 than in February 1980, yet in the last three years we have had an influx of 38,000 people; they're still coming to British Columbia. If I were unemployed in downtown Winnipeg when it was 40 below, I'd move to British Columbia. Or if I were unemployed in Regina when the wind was howling, I'd move to British Columbia. Or if I were in Alberta and didn't have a job because the NDP and the Liberals killed the energy projects in that province, wiped out the economy in a single swipe of the pen, I'd move to British Columbia too. They're coming here because they know there are going to be opportunities in British Columbia. They saw the budget coming; they see what's going on. British Columbia is on the move. But the funny part of it is that it's been on the move.

Interjections.

HON. MR. PHILLIPS: Yes, it's been on the move.

I have to laugh, Mr. Speaker. I listen to those poor guys over there who are in the construction unions, and they tell me there's no construction going on in British Columbia. "Oh, my gracious sake, this terrible Social Credit government has killed all the construction in British Columbia. We've got unemployed carpenters and steelworkers, we've got unemployed this and that." In downtown Vancouver there is more construction going on today than in any other place in the whole of North America, except Ottawa. Inflation never touched Ottawa; they're still pouring it in the ground like there's no tomorrow. I don't know where the money's coming from. I went to Ottawa at the height of the recession, and they didn't know there was a recession on. No siree, not in Ottawa. They just spend it down there; they just throw it around like it was going out of style. They remind me of the years between 1972-75 in British Columbia.

[ Page 5325 ]

Every time I go to Vancouver there's a new one-armed crane being erected somewhere to put up a new building and to employ people. I didn't say this, but the great Vancouver Sun, which is sometimes a little negative.... Maybe that's because we're not doing a good enough job of telling what is going on in the province. Listen to the doom and gloom about oh, my gracious, what's happening in British Columbia, in an article on Saturday, March 9 — even before the budget comes out: "A billion-dollar building boom is turning downtown Vancouver into a highrise haven in stunning defiance of a lacklustre economy." It's the private sector that's doing it, because they've got faith in this great Social Credit government. They've got faith in this province, regardless of what those socialists over there say.

What else does it say? "Their confidence in the future is expressed by architects in prestige designs of tinted glass, stainless steel and polished granite, all helping to create a glossy impression of a city on the move." I know the opposition are against this. You know, I didn't read a word about a megaproject in there. But I'll tell you, it's because of the other projects that this government had the courage and the guts to get going that this is going on.

I'll tell you, when we get the okay for the LNG deal.... Oh, the opposition were against that. Mr. Speaker, when I talk about them not being good Canadians, I want to remind you that every single solitary project that this government has brought forward — and they have employed thousands and thousands of people, building the infrastructure for the future that I mentioned in the throne speech debate the other day, so that we can take our rightful place in the future on the Pacific Rim because we put the infrastructure in place.... They were against all of it. And yet they have the audacity to stand over there and say that we haven't done anything for jobs or the economy in this province. No wonder they're over there and we're over here. And no wonder they'll stay over there and we'll stay over here.

Interjection.

HON. MR. PHILLIPS: You can classify it as anything you want to, my friend. All I'll say is that it's facts, not fiction; and it's positive, not negative. And it's happening today, not tomorrow or yesterday.

Let me tell you some of the other things that are happening today. You say we're not doing anything for British Columbia's economy. My friends, what about the coal that's moving out of Mt. Klappan? Oh, that one — a breakthrough in the market. Small beginnings, but it's happening. Why is it happening? Because the private sector people went in there putting in their money. They may need some help with the infrastructure before it's over, but that's what governments are all about.

You'd think that the Ministry of Highways here was just to fill in potholes. What in heaven's name is the Ministry of Highways for but to build roads for people to use and to build roads for business to use? What do you think they're supposed to be doing? That's why we have a Ministry of Highways: to open up the country. You know, British Columbia's still a developing country, and we need highways and the other infrastructure, and that's their responsibility, unless you want to do as they did in the old days and give it all to the CPR. Do you want to do that again? I thought you guys were against the CPR. I mean, we could give the country away to the CPR and let them build the roads and the highways. No, that's the responsibility of government, and that's what we're doing.

I heard a little while ago a mention by an opposition member of moly batteries. We helped put that project together with the private sector. It's a home-grown British Columbia technology. We didn't let it be bought up by the Americans or the Japanese, or by Alberta or Ontario. No, we put together a package and loaned them some money, because the banking system wasn't there to do it. So we did it. I want to tell you that that will be one of the greatest high-technology industries that you have ever seen here in British Columbia home-grown. In a few years we'll add more plants.

Where will the batteries go? Well, unlike the NDP, who say, "Don't build any power plants; we're going to get a contract with Eveready...." Well, you can get a contract with Moli now, fellows. But anyway, those batteries will be going into the export market, creating high-technology manufacturing jobs for British Columbia. Why, Mr. Speaker? Because this little government had the ability to see into that project and to work with those people and put it together. It's happening now, today. Plants are being built. Research is being carried on. Contracts are being made to sell that product in the international marketplace. That's what it's all about.

MR. WILLIAMS: What about northeast coal?

HON. MR. PHILLIPS: What do you want to know about northeast coal? Oh, they were against northeast coal. They're against it now. They've tried to say that it died on the vine. I'll tell you what's happening in northeast coal. It's working very nicely, thank you very much. It's getting the highest price for coal of any place in the world. And they said: "Ho! You're giving the coal away." That's what they told me.

MR. WILLIAMS: Did they put the hole in the wrong place?

HON. MR. PHILLIPS: Well, you're an engineer. If the private sector.... Weren't you an engineer? Or are you an economist? I thought you were an engineer. There's an engineer telling me that we put the hole in the wrong place. I'm not a bloody engineer. I didn't tell them where to put the hole. They put the hole where they thought it was the best place to go. And here you're blaming a politician because the hole's in the wrong place. Why don't you engineers get together? Blaming little me because the hole's in the wrong place! My god, we've got specialists in the Ministry of Energy, we've got specialists all over the world. The Japanese looked at where the hole was going to go. Engineering firms around the world looked at where the hole was going to go, and the hole went in the wrong place, and they're blaming Don Phillips.

Mr. Speaker, I think that's unfair, and I want him to withdraw.

Interjection.

HON. MR. PHILLIPS: Mr. Speaker, there are new manufacturing plants being built in British Columbia today. Yes, it's happening. New plants....

MR. WILLIAMS: Is that all on northeast coal?

[ Page 5326 ]

HON. MR. PHILLIPS: I'll tell you all about northeast coal, but it's so positive. I haven't heard any criticism from you. I'll wait. You're going to find it difficult, my friend, because right now in that same area two more mines are under negotiation. They tell me we can't sell any more coal in the international marketplace, just as the contracts are being signed in Japan and all over the world. "Oh, you can't sell any more coal. The market is saturated."

I want to tell you something: we can and will sell more coal, because we're British Columbians; we can and will sell more coal because we have the infrastructure in place; we can and will sell more coal because we have the most efficient transportation system of any country in the world; we can and will sell more coal because we've got the most efficient and progressive mining companies anywhere in the world. That's why we will sell more coal, and we'll sell more coal because that's a policy of the British Columbia government. The British Columbia government put their money where their mouth was and built the infrastructure when everybody else was saying doom and gloom. That's why we'll sell more coal, and we'll employ more people in doing it.

Not only that, Mr. Speaker, we'll get good prices for our coal. There are manufacturing plants presently on the drawing board. Things are happening already. There's a manufacturing plant for Penticton. There's a manufacturing plant.... Here we have a major expansion planned for Cominco at Trail. You talk about coal. Byron Creek Collieries Ltd. just made a commitment last December to spend an additional $50 million on a wash and dry plant. Why? Because they thought they'd build it? They're not going to sell any more coal, but they thought they'd like to have a new wash and dry plant? No, that's not why. Because there are markets out there, and there will be markets, and that's the private sector. All we've done is build the infrastructure, Mr. Speaker.

What about the $50 million sale to Japan by Fording and Westar recently, at a time when you tell me you can't sell any more coal? You can't sell any more coal? I want to tell you the markets are there, Mr. Speaker, and the markets will grow They're not going to grow as fast as we had anticipated, but coal is a great political commodity — a great whipping boy. I don't hear them whipping the price of copper or whipping the price of two-by-fours or whipping the price of beef or pork. But you'd think that coal had some fascination for the politicians. It's a great whipping boy.

It's an international commodity. We will sell more, and we will maintain our markets, and the sooner we in Canada realize that we don't set the prices for international commodities.... We're not big enough yet. I hope some day that as we increase our percentage, we may have some more influence, but we're doing very well, thank you, in the international marketplace. We're competitive, and we're a good, reliable supplier — a lot more reliable supplier in coal than we are in some other commodities.

We are looked on in the world market as a reliable supplier, and the sooner that all of the people in British Columbia, including those in the labour unions, get together and start working cooperatively for the good of all British Columbians, not just unions but for the good of all British Columbians.... I sort of get the sense right today that if I isn't a union job, if it isn't a union manufacturer or large multinational that employs union people, then the union leaders really aren't too interested in that project going ahead. That's got to stop as we employ more people.

You know, I had CAIMAW in to see me last year, I forget the exact deal, but BCDC had helped some firm to build some bedsprings that they were importing from somewhere else, and I was accused by CAIMAW of killing the other manufacturer. They came into my office, and they were going to eat me up — I was shaking. They were going to eat me up and spit me right out of one of those little windows in my office.

I want to tell you fellows, I said to them: "I'm the best friend you guys ever had. I've brought more industry into British Columbia than you can kill." I told them about the industries that they had killed and sent hopping back to Ontario. I said: "You guys, you better smarten up. Don't come into my office telling me that because I helped one industry that you killed before it even got to my office.... I'll tell you, Mr. CAIMAW union representatives, you better smarten up."

[5:30]

AN HON. MEMBER: Is that what you said?

HON. MR. PHILLIPS: That's exactly the way I said it; you go ask them. They said: "Cabinet ministers can't talk to us this way." I said: "Well, you've got one talking to you now. Like it or lump it, that's the way it is. Sorry, fellows."

Anyway, I've been fairly high on fish farming. You thought I was going to say something else, didn't you? Mr. Speaker, I'm very glad to see that fish farming will come under the Agriculture department and that British Columbia is finally recognizing that, with the best shoreline anywhere in the world, we will finally be competitive with other nations in the world when it comes to aquaculture and fish farming.

I support this budget wholeheartedly, because it is the type of budget that is going to create an important attitude in British Columbia. Governments are finally recognizing that the money businesses make should stay in their own pocket, and they will decide how to reinvest it. But the secret is that they will reinvest it — in new plants and jobs, and in the great economy of British Columbia. We have a great future. Canada has a great future. All we have to do is give the reins to those who have the spirit and the desire to work. We've been holding them back. All you've got to do is give them a little carrot, and they'll do the job.

MR. LAUK: Mr. Speaker, I wish to announce that word has just been received that the hon. Minister of International Trade has been nominated for the Jerry Falwell memorial speechifying award.

Throughout the hon. minister's speech I was convinced he would soon ask us to throw down our crutches and walk down the aisle. He talked about carping critics and negative thinking, and I heard this from several cabinet ministers and Social Credit back-benchers. That's all we ever hear, Mr. Speaker. They stand up and say that the NDP and the press have caused the depression, and we're nothing but negative thinkers and carping critics. We hear it day in, day out.

These people are a broken record. I'm sick and tired of hearing that government whining and whimpering all the time. They're always complaining. Everybody's responsible except them. You would think that they didn't win the last election, that the Vancouver Sun won it, or the Alaska Daily News, the Sapperton Review, the Richmond Chronicle, the Langley Hornet, or whatever. The NDP and negative-thinking people, like grade school students and people who are

[ Page 5327 ]

sitting waiting for coronary operations.... These are negative-thinking people. They are causing all the problems in the province of British Columbia, not the duly elected government.

No. One thing, Mr. Speaker, I was always told was that when a government was elected to power, responsibility came with it — responsibility for the good and the bad. They interpret criticism as being criticism not of their ineptitude and not of their lack of planning but criticism of Her Majesty's province, criticism of the people and criticism of the whole Commonwealth, but not of them. Isn't that strange? I thought that we were criticizing the government. But no, we are committing acts of high treason when we find somebody's hand in the till. We should be hanged publicly for an offence against the dignity of Her Majesty, because we've criticized the government for drilling the wrong hole.

It's traditional, Mr. Speaker, that when a member of the government speaks, a member of the opposition is to stand up and make comments upon the substance and content of the government member's speech. And I therefore will go right on to my speech.

I want to comment briefly about universities and post-secondary education with respect to the budget, and then make a general comment on the budget. We're told by the experts that this government has steadfastly and relentlessly, since 1977, taken the handout from the federal government — federal taxpayers' money — and applied it to the consolidated revenue to the extent that in this budget it is expected that this government will make a $20 million profit on postsecondary funding in British Columbia. The federal government will have transferred $20 million more than this government intends to spend on universities and post-secondary institutions. Instead of settling for that, this government, through this Minister of Universities, Science and Communications (Hon. Mr. McGeer), is suggesting that the universities provide a five-year "academic plan." In the same breath the Minister of Universities denies that he's meddling in universities. Where else, you history students over there, have you heard about a five-year plan? Does that sound familiar'?

SOME HON. MEMBERS: Where?

MR. LAUK: It sounds very much like the Soviet Union. It sounds very much like the five-year plans provided by the Soviet....

Interjections.

MR. LAUK: Oh, they're laughing.

One of the major building blocks of western democracies has been the autonomy of our universities and post-secondary institutions — but primarily the autonomy of universities. Academic freedom has been essential over centuries to build and protect our democratic freedoms — not to have them at the whim and fancy of one person or the prejudices and biases of one person. What is this minister's attitude? Superimpose that on the five-year academic plan that he wants.

He says he wants to get rid of all the socialites at university. At the same time the universities are raising fees and cutting back on student loans, grants and bursaries. Who do you think is going to be left at the university? The socialites, I would think. I'm not saying that anybody who goes to our universities is there for the social life. But if he wants to get rid of the social types who are not interested in a higher education, why doesn't he look at increasing grants and loans and assistance to students who are making it there on merit, rather than because they can afford it?

The second thing.... I won't deal with these in any given order. The minister is reported as saying that the Maritime universities are Mickey Mouse.

AN HON. MEMBER: So much for Dalhousie.

MR. LAUK: Yeah. I don't know what aspects of the universities....Does he mean the whole thing? We have some of the finest professional schools anywhere in the country in the Maritimes.

He wants to get rid of some useless courses, Mr. Speaker. What are they? Are they history courses? Are they philosophy courses? Are they archaeology, anthropology?

Over the 13 years I've watched the Minister of Universities in action in public life, I have really found the clear difference between an intellectual and a scientist. Some scientists can be intellectuals. We think of Einstein, Bertrand Russell and others. But the Minister of Universities is a scientist and only a scientist. An intellectual has a comprehension of all the world of knowledge and interaction and human behaviour in our society. He's not a person who has such a narrow view that his view must prevail, and no other view can find its place with him. He is a man with blinkers on and plugs in his ears. The only thing he ever learned, if he ever learned anything, was in the first few years of his educating life. Since then, he's never considered a new thought. He hasn't considered a new thought in 25 years — at least we've never heard about it in this chamber, and we haven't heard about it outside. Does he really consider that our society can grow and prosper without the humanities? What choice is he going to make — his tinkertoy ideas in the academic scheme of things?

If you took around the world, democracies are strongest where there's the broadest education for the widest number of people in their society. Where are the most prosperous countries in the world? Where the education is the broadest to the widest number of people in that society. Economically and democratically, the strongest countries in the world have the broadest education to the broadest number of people.

What if I were the Minister of Universities? Should my views of what different courses should be taught prevail too? Maybe it would be my view that commerce.... What is commerce? It's an expanding faculty, but what for? Can't we put it all on a megabyte or something, a hard disk, and put it in a computer? Do we need these people being educated in the commerce faculty at great cost? I happen to think so, but what if I held the bias, the view, that they didn't? This ministry is meddling in the affairs of the universities of this province to the detriment of the whole fabric of our society. The Minister of Universities is a menace to post-secondary education. He's a menace to this society.

What does recovery mean? Recovery must mean the strongest and largest possible investment in education. This minister talks about importing expertise. It's cheaper. It's certainly cheaper to the government if they shut down the whole post-secondary education establishment. Shut it down. We can export everybody to Seattle U, or to the University of New Mexico. Sure, we could export our young people. There's already a brain drain. There's already an export of young people in this province. The best professors

[ Page 5328 ]

at the University of British Columbia are looking for jobs elsewhere, and many have got them. Many are leaving. Some of them are even giving up their tenure to leave the University of British Columbia — the best on that pyramid of achievement at the university. Why? Because of the meddling and the ill-advised interference in the universities by the Minister of Universities himself.

He must learn that his office is not inherited, that it isn't one of his tinker toys that he can play with. He has a solemn responsibility to the public when he accepts public office. I say he's the most destructive force in the history of education in the province of British Columbia.

[5:45]

What about the budget? I say that the taxes in this province are too high. They're too high across Canada. It was interesting to hear some of the members opposite talk about "a new government in Ottawa, a breath of fresh air." The Wilson budget has delivered a $35 billion deficit. You know how much that is going to cost us in debt servicing charges alone — interest payments — per day per Canadian citizen? Four dollars. A family of four, $16 a day to service the national deficit. And they have the nerve to stand up and say there's a breath of fresh air in Ottawa. Who's kidding who? They are the worst of both worlds.

The Social Credit members are fond of saying: "Keep government out of the marketplace." You've heard that. "Reduce the regulations." They take the "non-interventionist" theory. Government is overtaxing people and directing fiscal power toward megaprojects in this province like no other provincial government has done anywhere else in Canada. Where is the marketplace? Who is subsidizing these megaprojects? Is it the private sector? Are they financed by the private sector? They're the ones that argue that government should....They did argue at one point that government should provide services like education and health and not meddle in the economy.

What have they done over ten years? They're the most interventionist government in the history of the province. They've spent four times more taxpayers' money in the nongovernment sector of this province than the NDP did. Northeast coal versus southeast coal; northeast coal at $1 million a job; huge amounts of taxpayers' money in Expo, ALRT, BCR — subsidized by the taxpayer; the Coquihalla Highway — if that's not interventionist, I don't know what is. They want it both ways. Socred austerity does not work. Taxes are up all over.

I was reading Mike Grenby in today's Sun, and this comes from the Fraser Institute. Remember that? This is the first time in history I've relied on figures from the Fraser Institute. Last year British Columbia was the fourth most highly taxed province. The average British Columbian had to work until June 27 before they started working for themselves. Now we are the second most highly taxed people. "Tax freedom day now falls on July 5, making B.C. the second most highly taxed province after Quebec...." We're only three days behind Quebec. Sally Pipes, assistant director of the Fraser Institute, says that incomes in B.C. haven't been rising as quickly as taxes: "While the average family in B.C. will earn $35,552 this year, up 3.3 percent from 1984, that family will pay $18,098 in taxes — up 7.5 percent."

Your friends are in Ottawa, and you bring down the budget here. What are you doing to the people of British Columbia? Income taxes take $6,190; pension, social security, hospital taxes, $2,299; sales taxes, $2,013; property taxes, $1,744; liquor, tobacco, amusement and other excise taxes, $1,711; corporate profit tax, $1,699; natural resources tax — auto, fuel and motor vehicles — $605; and so on.

What I'm saying is that we're taxed too high in this province, and what has this budget done to answer it?

Interjection.

MR. LAUK: They're up all over. There's less purchasing power to consumers and small businesses. What about new businesses? Does the budget attract new businesses by lower taxes or any other incentives? There are no incentives to add value to forestry and mining. Why didn't they lower the water taxes substantially and tie added value industries to those incentives? The industry had said they were ready for it — all they needed was that extra bit of push from the government. Why couldn't you tie lower taxes — like water taxes and the machinery taxes that you're going to eliminate — to added value in those industries? No. Why not? It's cheaper than a megaproject, and it would create a lot more jobs at a lower investment than that.

There are no incentives for new businesses, except the not very well thought through partnership with municipalities program. Lower property taxes, which may vary between municipalities and will allow already fiscally strong municipalities to bury municipalities who are in the race for new businesses — the weaker ones.... Within municipalities new businesses, no matter what the criteria, may directly compete with already established businesses in that community. One business creating the same or virtually the same product or service, with taxes, competing with someone who has a tax break; it's a very poorly thought out program. In the same jurisdiction, I'm talking about. To say that such new businesses must be unique and not compete betrays the program as a sham. There are very few such new businesses, and any new businesses that we can think of that are possible are insignificant in the whole scheme of things. The program is nothing but smoke and mirrors. It's not going to work. It's not going to provide new businesses to the municipalities. It's a pipe dream.

Mr. Speaker, the Mulroney budget did not do anything to help this government, it's quite clear. This government was as deceived as anybody else was by the Wilson budget. It's an inflationary budget. It doesn't change any of the government's spending priorities, and at the same time that they're handing us the $35 billion deficit, they're not creating any new jobs in the foreseeable future.

They are mortgaging the future of the country, and they're doing nothing to help their so-called friends on the other side of the House. There's only one answer, Mr. Speaker. We've got to replace those people on the other side of the House. They're not doing the job. With friends like Mulroney and Wilson, you don't need friends; you need enemies. That's where we come in.

Some $300 per employee as a tax credit to small businesses — that's really fantastic! Boy, this government has moved in a bold new direction, hasn't it? We can shut down those soup kitchens tomorrow. Send out the word — a $300 dollar-a-year tax break per employee for small businesses. Well, if it applies to the larger business, that amounts to a lot of money, but when.... Small business, I always thought, were 20 or less employees. Isn't that right? That $300 a year is sure going to employ a lot more people. That's a real

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incentive. It seems to me that had they done nothing, it would have created more jobs than had they put this in there.

The only jobs this is going to create is the extra three people in Finance to take care of the paperwork. That's all it's going to do. A couple of more programmers at B.C. Systems to plug in the floppy disks or whatever. That's all of the jobs it's going to create.

This is a budget of smoke and mirrors. I'll tell you, I will throw a bouquet to the Minister of Finance, who I know is listening to me in his office. It was a complex nuisance to have the machinery tax and the tax on equipment in a plant that was not operating. That's a move in the right direction. But the government, you know, gives away its chips. All you have to do is use your fiscal power — and I know it's not much in a provincial situation — to add leverage to the industry.

Every other jurisdiction does it. They do it in Japan; they do it in quite a few places in the United States; they do it in Europe. Why can't we do it in Canada? What's the big problem in tying our fiscal power to new directions for value added to our major resource industries? There's nothing wrong with that approach. It's not communist, socialist, fascist, or anything else. It's just good common sense. It's acting responsibly for the people of the province of British Columbia.

Mr. Lauk moved adjournment of the debate.

Motion approved.

Hon. Mr. Nielsen moved adjournment of the House.

Motion approved.

The House adjourned at 5:57 p.m.

Appendix

WRITTEN ANSWERS TO QUESTIONS

1 Mrs. Wallace asked the Hon. the Minister of Environment the following questions:

1. What was the total amount in the Habitat Conservation Fund as of (a) April 1, 1984 and (b) December 31, 1984?

2. How much was added to the fund between April 1, 1984 and December 31, 1984 from (a) surcharge on licences and (b) other sources (please identify) ?

3. How much was expended from the Habitat Conservation Fund between April 1, 1984 and December 31, 1984? Please identify by project, location and amount spent on each project.

The Hon. F. C. A. Pelton replied as follows:

"1. The balance in the Habitat Conservation Fund was $1.12 million on April 1, 1984, and $1.83 million on December 31, 1984.

"2. Revenue to the Habitat Conservation Fund between April 1, 1984 and December 31, 1984 was $1.49 million.

[ Page 5330 ]

"3. A total of $777, 521 was expended on 62 different projects in various locations around the Province.

EXPENDITURES ON HABITAT ENHANCEMENT PROJECTS OF THE
HABITAT CONSERVATION FUND
April 1, 1984 to December 31, 1984

[ Page 5331 ]

HABITAT CONSERVATION FUND

A summary of Revenue and Expenditures of the Compensation Donation Account, April 1, 1984 to December 31, 1984.

¹ Enhancement projects for donation from Cominco Ltd., Copper Division, are in preparation.

HABITAT CONSERVATION FUND

A summary of Revenue and Expenditures of the Habitat Enhancement Account, April 1, 1984 to December 31, 1984.

¹ Balance on March 31, 1985 will be substantially less due to seasonal nature of some of the enhancement work. Projected balance is $911,000."