[ Page 6751 ]

CONTENTS

An Act Establishing The Right To Public Information And The Protection Of Individual

Privacy (Bill M222). Mrs. Dailly

Introduction and first reading –– 6751

Committee of Supply: Ministry of Tourism estimates. (Hon. Mr. Richmond)

On vote 65: minister's office –– 6751

Mr. MacWilliam

Ms. Brown

Hon. Mr. McGeer

Mr. Williams

THURSDAY, JUNE 20, 1985

The House met at 10:03 a.m.

Prayers.

HON. MR. RICHMOND: In the precincts this morning is a group of students from Aberdeen Elementary School in Kamloops, and I would like this House to make them very welcome.

Also, Mr. Speaker, today is the final day of employment for one of our Sergeant-At-Arms members, Mr. Ron Emmerson, He is in the Speaker's corridor down on the right-hand end near the government caucus. I would urge all members to wish Ron well in his retirement.

MR. LOCKSTEAD: Mr. Speaker, seated on the floor of the House today is Mr. Tony Gargrave, who served as an MLA in this Legislature — and, I might add, as an outstanding MLA for the riding of Mackenzie — for 14 straight years, from 1952. It's my pleasure to introduce him, and I ask the House to join me in welcoming him.

MR. SPEAKER: Hon. members, also visiting with us today, from the state of Alaska, are Senator and Mrs. Richard Eliason. I would ask the House to make them welcome.

Introduction of Bills

AN ACT ESTABLISHING THE RIGHT TO
PUBLIC INFORMATION AND THE
PROTECTION OF INDIVIDUAL PRIVACY

Mrs. Dailly presented a bill intituled An Act Establishing the Right to Public Information and the Protection of Individual Privacy.

MRS. DAILLY: Mr. Speaker, I believe the title explains the message of this bill. I would like to add just a couple of brief comments.

Today, in our complicated society, never was such a bill needed more. Only four other provinces and the federal government have bills such as the one I'm introducing today. Knowledge is power, and without knowledge an inequitable situation exists when the public attempts to understand the role and policies of government. Government is for the people, and if we're going to follow that through, you have to give people the right to access of information. Also, with information banks and the increased complexities of society, more and more people find there is an invasion of their privacy when it comes to personal records. This bill would alleviate — hopefully — some of these problems which exist today in our society.

Bill M222 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Orders of the Day

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

ESTIMATES: MINISTRY OF TOURISM

(continued)

On vote 65: minister's office, $151,996.

MR. MacWILLIAM: Mr. Chairman, I was hoping that we'd get a little more opportunity to discuss the Premier's estimates, but I guess we're back on this one. However, there's a lot of material to clear up that hasn't been addressed yet.

I mentioned that we would take a two-phase approach to the discussions in Tourism, one dealing with tourism in general and the second dealing with Expo 86. We still have a couple of loose ends to clear up in terms of the general thrust of tourism and a couple of points I'd like to address in particular.

It seems the minister let loose a bit of a bombshell, Mr. Chairman, some time back. As reported in the April 24 edition of the Nelson Daily News, the minister mentioned his favouring the privatization of campsites. The statement as it appears does raise a lot of questions as to just what the minister does mean in terms of privatization.

I think there are two possibilities here. The minister may have been discussing the full privatization of campsites involving the sale of these campsite facilities, as has happened in Manning Park, which would be basically a sellout of the entire public resource; or perhaps in his philosophizing he was discussing merely the contracting-out of services. I know that his statement has caused quite a bit of concern in the tourism area. Perhaps the minister would like to clarify just what he means by the privatization of these provincial campsites.

Because the other questions are significantly different, perhaps the minister would like to respond to this one at this time.

Perhaps the minister would like to listen to the question.

MR. CHAIRMAN: The member continues.

MR. MacWILLIAM: Well, I think the lack of response from the minister on that one certainly puts a lot of confusion into the issue. I would suggest that in order to clarify it for the tourism industry an appropriate response should be forthcoming.

The second piece of information that still is left hanging and I would like to go back to — we touched on it the other day — is the supply of tourist brochures on B.C. Ferries, Perhaps I'll just refresh everyone's memory on the discussion that did take place, in leading into the questions I have.

The other day in the debates the minister confirmed that Tourism B.C. had been in contract with Vancouver Island Tourist Services Ltd. for the period including January 1, 1985, to April 30, 1985. In addition, the minister confirmed that that contract was for the supply of brochures for the B. C. ferries. The minister also confirmed that the contract was subsidized to the tune of $25,000 by Tourism B.C. The other day I revealed evidence that at the same time this same firm had been awarded a contract on an unsubsidized basis, beginning on May 1, 1985 — a contract, again, for the supply of brochures. The contract would not be subsidized. The critical question here is that there seems to be a four-month interval of overlap there where the company, even though its contract had not started until May 1, had been advertising for clients on the unsubsidized rate structure as of January 1, 1985. So

[ Page 6752 ]

there's a four-month overlap where the company appears to be charging a full rate to put the brochures on the ferry and yet still seems to be receiving the subsidy from Tourism B.C. I raised the issue of whether it's a case of purposeful or perhaps inadvertent double-billing or possibly of misleading advertising. There are a lot of questions regarding this.

I'd like to bring some further information to the minister's attention. The proposal for the new contract with B.C. Ferries was apparently advertised in the fall, while the contract was still in effect with Tourism B.C. A number of other firms apparently submitted detailed bids. One of the bidders asked if he could solicit clients in the Washington-Oregon area, and was advised that this would not be possible. The other day I provided proof to the minister that this is in taking place; that they are soliciting clients from these areas. The bidder in question — one of the unsuccessful bidders — felt that they were supplied, basically, with the wrong information regarding the solicitation of clients, and it affected the details of their bid.

[10:15]

In addition, B.C. Ferry Corporation advised that the main reason VITS was awarded the contract was that they would, apparently, distribute the ferry schedule for free. I think this amounts to about $13,000 in kickback. This was not part of the original proposal, and it appears to have given Vancouver Island Tourist Services an unfair advantage.

I realize we're on a hazy edge here. We're dealing with two ministries, but because the minister's subsidization does affect this period of time, I think it's well within order in providing the minister with this information.

So there are some questions that arise as to whether any unfair advantage was given in the awarding of the VITS contract. Questions arise as to the possibility of this double billing — receiving a subsidy while charging clients the full rate. The minister has agreed to look into the matter, and I would ask if he would pursue an investigation and supply a complete answer to the House. I would also ask that the minister, if infractions are found, would recommend the cancellation of the present contract and resubmission of tenders.

HON. MR. RICHMOND: I'll deal with the member's last question first. He is correct. The other day in my estimates I agreed to undertake to look into that ferry contract and bring an answer back to the House, and I have, Mr. Chairman. First of all, the contract is with the British Columbia Ferry Corporation and not with the Ministry of Tourism, so any detail will have to be brought up during the estimates of the Minister of Transportation and Highways. But upon looking into the alleged wrongdoing of Vancouver Island Tourist Services Ltd., I find there is none. What has happened is that Vancouver Island Tourist Services sent a letter to all their customers on April 2, 1985, explaining the situation. I won't read the entire letter, but I would be happy to table it with the House. I don't believe I can table documents in committee, Mr. Chairman. Is that correct?

MR. CHAIRMAN: That is correct. Documents will have to be tabled when the House reconvenes.

HON. MR. RICHMOND: Thank you. I'll table the documents at some later time when the House is sitting.

What took place exactly was that their contract runs from May 1 of each year. The start of their fiscal year is May 1, and they had inadvertently left that out of the letter previously sent to their customers. They've corrected that with this letter. The subsidy from my ministry that the member talks about merely extended that contract up to the end of their fiscal year, which was April 30. So they were not double charging, as was alleged the other day in the House. I will table the document to clear that up. Any further contract details required will have to be taken up with either the B.C. Ferry Corporation or the minister responsible, the Minister of Transportation and Highways (Hon. A. Fraser).

On the first question, I think the member knows full well that when I made that speech — which is roughly a year and a half ago — I said very clearly, I thought, that we were speaking of the privatization of some of the campsite services. I think that any thinking British Columbian would know full well that we would never privatize — in other words, "sell off" — the beautiful campsites of British Columbia. But the minister of Lands, Parks and Housing (Hon. Mr. Brummet), under whose jurisdiction this falls, has had many contracts tendered — I don't have the exact number — for the privatization of some of the services offered at the campsites, such as cleaning them up, providing firewood, looking after the washrooms, and making sure that the amenities, whatever they are, are there for the visiting public. That is exactly what was meant and implied by the privatization of services involving campsites — nothing more, nothing less.

MR. CHAIRMAN: With respect to the minister's last comment, the minister is responsible for the administration of his department and cannot comment on the administration of another ministry.

MR. MacWILLIAM: Going back to the question about Vancouver Island Tourist Services, I'm well aware of the letter that was put out afterward. However, the original application form for 1985 — this one right here — very clearly indicates January 1, 1985 to December 31, 1985, and it has the rate structure clearly outlined. The rate structure is approximately double what it was the year before, indicating that the subsidy had been taken off for this period of time. I would say that, as it is written, the application is at best very misleading. I know that there were a number of concerns addressed by members of the industry about just what is going on here. I don't really think, in rebuttal to the minister, that that explanatory letter that came afterwards offers a complete explanation. Apparently around 1980, VITS changed the term of their contract from a calendar-year period, January 1 to December 31, which apparently resulted in a double billing to their clients for the period of January 1 to March 31. However, that's going back a few years, so I guess it depends what end of the scale you are looking at. But it seems that there is a four-month overlap in this period of time where there is a possibility of a double payment having been made. I have also, I might add, approached the Minister of Transportation and Highways (Hon. A. Fraser) on this and made the same information available to him.

I hope that this can be clarified, and I also hope that the other questions involving the letting of the contract, the problems that have been brought up at this point, can also be clarified. I would hope that because it is an overlapping responsibility and your subsidy was in effect for that time, you would pursue the investigation as to whether the contract was fairly tendered.

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HON. MR. RICHMOND: Mr. Chairman, I'd be happy to, and I think it can be clarified right now. It's quite plain and simple that there was no overlap. There was an error on the original form that you have just held up, which is freely admitted. It was detected by my ministry and pointed out to them that the contract should have read May 1. It was corrected, and there was no overlap; there was no double billing. We have investigated it thoroughly, and I think that clears it up: a mistake made and freely admitted after being detected, and corrected.

I will table this letter, as I said, at some future time, which I think clears the whole situation up.

MR. MacWILLIAM: Mr. Chairman, I'd like to change focus a little bit now and move into discussion of Expo 86 and talk about it as a business venture, about fiscal policy and also about some historical antecedents of the fair.

I think through projects such as Expo the current government has as much as admitted that it has to engage in deficit financing as a means of economic stimulation in this province. It is really practising what we've been saying all along: that a major function of the government has to be to prime the pump and smooth out some fluctuations in economic activity by engaging in what economists call countercyclical fiscal policy; as I mentioned, basically priming the pump during bad times to get economic activity rolling.

The problem this government seems to have ignored is the other side of the equation, the flip side of the coin. It doesn't seem to have learned to conserve revenues during the good times in order to create a rainy-day fund, so that we don't have to go into heavy borrowing to prime the pump in bad times. As a result, we're having to borrow for a lot of these projects, such as northeast coal and the other megaprojects, Expo 86 being one of them. This is resulting in an increasing deficit; there's no question about it. When this government took power a decade ago, the accumulated deficit up to that time — for 104 years — was $4.2 billion. In the last ten years that deficit has spiralled to $17 billion. So there's no question in my mind that there's a lot of borrowing going on.

In some ways I guess Expo 86 is the government's attempt to solve a problem by throwing money at it. It's generating a certain amount of economic activity, and I give it full credit for that. It's generating a considerable amount of employment in the coastal area, and I give it credit for that. For those reasons we do support it in principle. We do support the fair; there's no question about that. Because it's the big egg in the basket of our immediate economic prospects, members on this side of the House want to make sure that the fair generates as much economic impact in this province as is humanly possible. We want to see Expo succeed, no question about it. All of our attempts at raising questions about or criticisms of the fair are not to the point of going against the concept, but ensuring that we run it in a way to guarantee that we succeed as much as we can.

[Mr. Ree in the chair.]

We're deeply concerned about the economic impact of Expo. My feeling — and I'm sure the feeling of many of my colleagues — is that the economic impact of the fair will be small when you compare it to an equivalent expenditure of money: $802 million on the government side; a total, I think, of about $1.5 billion. If you put that money into a number of community-based job-creation programs, reforestation programs, community works programs, the impact of that expenditure would be much greater and more equitably distributed throughout the province. So the question is not one of whether Expo will generate economic activity; it certainly will. But will it create as much as if we spent that money elsewhere? I think that's a question that hasn't been answered. Are we getting good value for our investment dollar?

As I mentioned, because the construction phase of Expo is so capital intensive, it may not create the number of jobs that equivalent expenditures would create in, for example, our small business or service sector. The question remains: just what will be the economic impact of Expo 86? Let's analyze that on three levels: an historical perspective on some other world fairs; Expo as a business venture; and fiscal policy. Let's break it down into those three areas.

I'd like to point out some historical factors that do raise some questions. A recent economic impact analysis by UBC's Economic Policy Institute shows that 15 of the last 18 fairs have lost money.

Interjection.

MR. MacWILLIAM: The Minister of Education has some disagreement with me. There are other reports, Mr. Minister, that I will be discussing.

Let's take a look at some of the fairs in North America since 1962. Seattle in 1962 was a rarity in that it didn't lose money. Gate passes exceeded estimates, with a revenue surplus of $12 million. But actual profits of only $5 million indicate that if the fair had gone as planned, they would probably have ended up about $7 million in the hole. New York in 1964 was introduced as an exciting way to create economic growth and turn a profit, but attendance estimates were wildly optimistic. Losses of $71 million were reported; decommissioning costs of over $104 million.

[10:30]

Interjection.

MR. MacWILLIAM: No, it's not doom and gloom; it's reality, Mr. Member. Losses of $200 million were actually incurred.

Expo 67, heralded as one of the most successful fairs: initial production estimates of $401 million blossomed into a $1.4 billion expenditure. There was an expected gain of $700 million, but the actual deficit was $957 million. There's a similarity between Expo 67 and Expo 86. That similarity is the assumption that the sale of buildings, or the decommissioning of the site, from Expo will cover the costs of decommissioning. I think in these other cases it has been shown not to be the case. I'll get back to the decommissioning a little bit later.

San Antonio in 1968 finished in the red, again because of overly optimistic attendance estimates. It heralded the promise of economic stimulation and job creation, but turned into a $24 million deficit. Expo 74 in Spokane was forecast to turn a handsome profit, and the projected attendance or gate pass estimates never materialized. It lost $2 million, and had decommissioning costs — unexpected costs — of $21 million. In 1982 at the Knoxville Fair the gate passes, again, fell far short of the estimates. Financial figures were misrepresented. Expo 82 in Knoxville was so successful it resulted in the third-largest bank failure in U.S. history. New Orleans in 1984: another recurring financial disaster with a loss of

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millions of dollars. Again — I repeat: again — in looking at the historical aspects, one of the problems was that the attendance estimates were wildly optimistic.

Now where do these historical factors lead in terms of the financial aspects of the fair? First, it seems a recurring problem that the escalation of construction and production costs develop as a result of unplanned expansion. In other words, they start off small and they get bigger and bigger and bigger. Expo 86 began — I might remind everyone — as a $127 million celebration. Now it has blown into a $1.5 billion megaproject. So there's a cautionary note in that regard.

Attendance forecasts tend to be optimistic. I think our initial estimates of the fair were around 20 million visitors. I know that's been revised after the minister has taken a look at New Orleans in '84; they've been sliced to, I think, about 13.75 million. But there is still some question as to the method of analysis that the ministry has used, or the fair has used, in arriving at this gate pass estimate. I would ask the minister what the method of analysis was in arriving at this gate pass figure. Did the analysis actually involve the standard technique of linear regression analysis? If so, then the analysis must have included ticket price, size of fair and number of exhibits. But did the analysis also include the current disposable income of British Columbia citizens, the geographic dispersion factors of our population and the current unemployment level? Did it include these economic and geographic factors? I think consideration of these variables may have a moderating influence on the attendance estimates. I hope not. I hope we're being conservative with our attendance estimates. I really do. I hope that the gate passes exceed those projections. But the question still does remain.

Thirdly, expenses relating to operating and auxiliary services for past fairs have tended to be underestimated. I think with Expo 86 there are a number of costs that have not been adequately accounted for. I suggest the opportunity cost of the land which Expo is sitting on — roughly, if the land could have been utilized for other activities, a cost of around $140 million in value. There are policing, fire and health costs, the associated costs with improving highways and construction of auxiliary transportation and the costs of decommissioning the site, which don't seem to have been adequately addressed. Unless there's been a change in that area, it seems that the present position — you might want to correct me on this, Mr. Minister — is that the sale of the buildings will pay for the decommissioning costs. Historically it has been shown that the decommissioning costs of a world-scale exposition such as Expo is approximately 10 percent of the fair, perhaps in the area of $56 million.

Some specific questions. Again, in addition to the questions I've just laid out, has the ministry done a detailed cost benefit analysis of the fair? If it has been done, why has the minister refused to make this cost-benefit analysis available to the public? If it has been done, will the minister agree to table copies of that cost-benefit analysis? It's very hard to deal with the figures for Expo when you can't get your hands on the pertinent information.

I think I'll sit down at this point and let the minister address those questions.

HON. MR. RICHMOND: It's a pleasure to at last have an opportunity to stand up and talk about Expo 86 in some detail. I thank the member for his question and, I suppose, his concern. First of all, I want to start by giving a rough outline of the magnitude and complexity of an exposition like Expo 86. I'll be very brief, but I would like the member and this House and the people of B.C. to know that to date we have signed up 41 countries, some of the leading nations and some of the developing nations of the earth, who will be participating on that fairground. They will literally be in our back yard in 1986. For the first time anywhere in North America, the U.S.S.R., the People's Republic of China and the United States will be on the same fairground at the same time.

They are not there just for the sake of being there, but to display, to show off, the very best they have to offer, not only in technology but also in culture, cuisine and folklore — in everything that they do, right from space-age technology back into their past. They're not there spending millions of dollars just for the sake of making British Columbians feel good. They are there for the benefits that they can get from Expo 86. That's exactly the reason the province of Ontario is there, spending about $26 million on a pavilion so that they can take advantage of the people who are going to be in downtown British Columbia for five and a half months in 1986.

1 think people tend to lose sight of the impact that an exposition like this is going to have. Let me talk for a moment about the industrial and business opportunities. Through the Minister of International Trade (Hon. Mr. Phillips) we are making sure that every leading industrialist and business person in the world will be at Expo 86 at one time or another. He is sending out some 30,000 invitations to the leading movers and shakers around the world, who are the industrialists and businessmen, so that we make sure they are here. Having got them here, we are not going to be content to just let them see a world exposition. Many of them have seen those. We want to show them British Columbia. I don't want anyone over there, or in British Columbia, to lose sight of the fact that we're going to be taking these people throughout our province and showing them why they should be relocating or expanding or moving into British Columbia with their factory or research company or whatever it is they happen to do.

I don't want people to think that we're just putting on a fair for the sake of showing off and putting on a fair. This will have far-reaching, long-range industrial and business impact in this province. Couple that with the benefits to tourism. The multiplier effect — people going back to where they live and telling other people what it's like in British Columbia — is incredible, as has been proven at other world's fairs. We want to do business with these people, these tourists, these visitors to our province, in 1987, 1988 and 1989 — and we will.

Yesterday the second member for Vancouver East (Mr. Williams) got up and said — I'm paraphrasing — that we are not getting return on our investment in Expo 86. Mr. Chairman, that is patently untrue. I'm sure that the member is not looking at the positive side of the ledger of this fair. Here's one example. He mentioned the unemployment in the construction industry. Let's talk about that, and I'll quote from that party's leading source of research, the Vancouver Sun, of two or three months ago. At this time there is $900 million worth of construction going on in the city of Vancouver alone that is related to Expo but being done by the private sector — unrelated financially, but triggered by the fact that we're putting on a world exposition. This is in addition to the $400 million worth of construction that Expo is doing. I think that comes out to $1.3 billion in the construction industry alone in Vancouver. If the unemployment figures are too high in the construction industry — and I believe they are; I think we all believe they are — think of where they would be without this

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project going on in downtown Vancouver. Take that $1.3 billion out of that construction economy and see where the unemployment figures would be, Mr. Chairman.

We planned this fair far in advance of the global recession that hit us in 1982. This fair was planned in 1979, but from a work-creating standpoint we couldn't have planned it better if we had tried. I shudder to think where a lot of those people down on that fair site and throughout this province would be working today if we hadn't made the decision to go ahead with Expo 86.

The economic impact, the member says, is small. All I can do, I guess, is quote some figures. If $3 billion in economic activity in this province is small, then I guess that's small. The independent studies that have been done — and the one firm that comes to mind is Coopers and Lybrand — have told us that in British Columbia alone Expo 86 will generate $3.2 billion in economic activity. That's a conservative estimate based on 13,750,000 visits. If that is small, I would like the member to explain to me what is large. In direct jobs 63,000 person-years of employment will be provided by Expo 86. That doesn't even take into account the spinoff jobs and all the people who are supplying goods and services to Expo. The young people will have an opportunity next year to work at a world exposition, something that comes along once in a lifetime. I'm very proud and happy to say as a member of this House that we're providing that opportunity for thousands of young people to work on that fair site and gain an experience that they couldn't possibly ever get by any other means.

The member, I think in all sincerity, and the media speak constantly of world expositions losing money. I contend, Mr. Chairman, that they look only at one side of the ledger. I'm not an accountant, but I think I can read a financial statement; I had to at one time to survive. But I think that anyone who reads a financial statement has to look at both sides of the ledger: the profit side and the loss side, or the expense side and the benefit side of that ledger. Too often people look only at the expense side of the ledger of a project like Expo 86 –– I think that they tend to ignore the benefit side. I think that if that party or any other one could put on a make-work project for the dollars that we are going to put into Expo, and generate what we're going to generate, they'd be standing up on top of their desks bragging about it. If they could put in the dollars we're going to, and generate $3.2 billion in economic activity, they'd be the first ones to be bragging about it.

They talk about the deficit in Montreal, just for an example, which, up until now, was probably Canada's finest moment. Expo 67 was magnificent. It was a fair that made every Canadian feel proud. I spent a week there, and it was just absolutely incredible. Their projected attendance, for example, was in the order of 20 million, and they ended up with 52 million visits to that fair.

Interjection.

HON. MR. RICHMOND: The member says that it just about bankrupted Montreal. He's making a mistake that many others make, Mr. Chairman; he's confusing it with the 1976 Olympics. Expo 67 was a success in every sense of the word — financially as well. Sure, there was a deficit, but when you weigh it against the benefits, the deficit was insignificant compared to what that did for Canada, for Quebec and for Montreal. On the other hand, the 1976 Olympics, which was a two-week event, was a financial disaster, an absolute disaster. We all know that, and I'm not going to go into the money that that cost the Canadian taxpayer. Expo 67 was anything but, and Expo 86, although not as large a plant — we don't have the physical site that Montreal had — will be every bit as successful, if not more so. The quality will be every bit as high, if not better, than Expo 67.

[10:45]

I'm not putting down Expo 67; it was one of the finest world's fairs ever put on. It was a different class of fair. It was an open-category fair, which is totally different. In those — just briefly — the internationals build their own pavilions. In our fair they don't; we build them and turn them over to them.

That brings me to the member's next statement about the decommissioning of the buildings. These buildings are of modular construction and have been built by the Expo 86 Corporation — I'm talking about the buildings for the foreign participants. They will be turned over to those participants in November of this year — a full six months ahead of the fair opening — so that the foreign participants can get their exhibitry ready and be ready to open on time. I'll tell you, Expo 86 will be ready. We're on schedule, we're on budget, and in fact even the Japanese at Tsukuda have to admit that we're further along in our planning and our construction than any world's fair that they've seen to date, including their own. They even had some buildings that weren't finished the day before they opened. Again, I'm not putting down their fair; I understand that it is a good world's fair. It's not as exciting as ours is going to be, but it's taking a totally different approach to the subject.

There has never been any mention or thought of selling those modular buildings, Mr. Chairman, so I want to correct the member there. I think that's what I heard him say: "the sale of those buildings." There has never been any talk of selling those buildings. I want to set him very straight on that.

I want to go now into the advanced sale of tickets. The advanced ticket sales on Expo 86 are far ahead of even our expectations and far ahead of any other world's fair to this date. I can't give you a precise number at the moment, but I can tell you it's in the millions of dollars. In Vancouver alone the payroll deduction scheme is working beyond our expectations, and I thank the city of Vancouver, whose mayor, in 1981, Mr. Chairman, sent a telegram to the BIE in Paris asking them to cancel the fair. Since then I'll give him full credit. As the Premier said, he got back on board before it became popular to do so, so I give Mike Harcourt full credit. He's one of the best boosters now that Expo 86 has. He is pushing it wherever and whenever he can. I'll give him full marks for that. We have a good spirit of cooperation between Mr. Harcourt, me and the Expo 86 Corporation.

I repeat, it's on time and it's on budget. The number of visits have been projected at anywhere from 12 million to 28 million. We, the board of Expo, decided several months ago for financial planning to use the estimate of 13,750,000. We felt it was a conservative estimate; in fact I think it's very conservative, but for financial planning we decided to be on the conservative side, and that's why it is set at that. I believe that we will do somewhere between 15 million and 18 million and possibly even go as high as 20 million visits. I am being optimistic perhaps, but not as optimistic as some. The word we get back from the international travel agents and travel press is that Expo will be a tremendous success.

The foreign participants can feel it already, Mr. Chairman. We are becoming the victims of our own success in the sense that we are having countries now trying to come on

[ Page 6756 ]

board at Expo, and we don't have the room for them. They know that it's going to be successful. We will have to cut off the number of countries at about 42 or 43. We're at 41 right now.

The member asked what studies took place. I can tell him that several studies have taken place by experts in the field. Yes, they did consider the economics of the time. They considered the geography, the demographics. They have considered everything that people in their profession consider. As I say, when you get the opinions of experts as to what the attendance will be, they run all the way from 12 million to 28 million, so there is a large margin in there, I imagine, for prognostication. I imagine if we did more surveys we would get more numbers of attendance.

The land costs that the member referred to — I don't really know what he was driving at. But I can tell you that the landlord on the site is the B.C. Place Corporation. We have to turn the land back to them when the exposition is finished. Only three buildings will remain: the CPR roundhouse, which is a heritage building, the British Columbia Pavilion and the Expo Centre. The rest will be turned back to the corporation so that they can proceed with what will be the largest and probably most exciting urban renewal project in North America, possibly even in the world; I don't know. It will be about 173 acres right in downtown Vancouver.

The other thing I can tell you is that the services that have been put in for the fair will remain for the British Columbia Place Corporation, to enable them to get on more quickly with their downtown revitalization.

MR. MacWILLIAM: Just to go over some of the minister's previous statements, the opportunity cost of the land is what they could have gotten for that land had they developed it and rented it out or.... I think those costs that I made mention of were the rental costs for that land. I believe Expo is basically getting the land for virtually nothing. We're essentially losing the opportunity cost of renting that land for that period of time. That's a cost that hasn't been accounted for.

I want to go back to some previous things that the minister has said. He said that in criticizing the deficit of the fair, people haven't considered the benefits. But I want to correct the minister, Mr. Chairman, because any financial analysis shows that the deficit is the result of the arithmetical calculation between benefits and costs. You have to look at the costs and the benefits. You subtract one from the other, and you get either a surplus or a deficit.

So we have looked at the benefits and at the costs as accurately as we can for the information that we have available, which isn't an awful lot, and you come out with a minus figure. Now that, I think, is called a deficit. If the minister wants to argue that point, I guess he may do so. But I'd advise him to have a look at what the word means.

The minister made mention of approximately $900 million of construction in the Vancouver area related to the fair. I really think the minister is stretching a point. I would like to see him justify that that construction is indeed taking place solely because the fair is coming to Vancouver. I don't think you can justify that, Mr. Chairman. I think it really is stretching a point.

For example, I could say that the deficit of the fair must also include the Coquihalla Highway and the Annacis Island Bridge, because they are being constructed on a timetable in order to accommodate the fair. If we want to play those kinds of word games, we could be here all day. The Coquihalla Highway is $375 million; the phase 3 extension to the Okanagan is another $100 million; the Annacis Island is $75 million. We can add that onto the deficit side of the equation, if you want to play those kinds of games. You're stretching a point by saying that that $900 million is directly related to the fair. I would take you to task on that to justify it with some hard-nosed accounting figures. What does that $900 million include? What is the construction? Are you talking about ALRT or what? Let's not stretch the point. Let's stay on the facts and figures of the fair itself and use some hard-nosed calculations based on the projected costs and the deficits of that.

The minister did not answer a question which I consider critical in terms of an overall cost-benefit analysis. I haven't been able to get my hands on any cost-benefit analysis done by Expo 86 Corporation. I do believe that like any responsible body, they will have done one; they may have done a number. I would ask if the minister would consider making that information available so that people can come to deal with the figures that the ministry is in fact dealing with. Would you please consider making that information public, or tabling it here in the House at a later time.

The point that the minister made about the gate-pass estimates I don't quibble with. The figures I have from a recent linear regression analysis showing the attendance estimates indicate that they're pretty well on track with the 13.75 million. I'm certainly hopeful, as much as the minister, that we go over that estimate, but you do seem to be on track in terms of other studies that have been done. In terms of Expo as a business venture, as I mentioned before, in looking at a cost-benefit analysis of the fair it's really difficult to come to terms with figures. It seems very difficult to get figures available on it.

Statements have been made by the chairman of Expo 86 Corporation, Mr. Pattison, that the fair will lose $311 million. That is a deficit, I think you would agree. Now if you look at some of the hidden costs, I think we may see that that cost or that deficit — if you want to deal with semantics — may in fact be even greater. I mentioned the decommissioning costs of the site. Has the minister included the historical 10 percent of the construction costs in dealing with the decommissioning? Previous studies, as I have said, show that the decommissioning costs of the fair run approximately 10 percent.

The cost of the land — let me get back to what I was talking about before. You're leasing 165 acres from B.C. Place for one dollar. It's not exactly exorbitant rent. The actual cost is much greater. The opportunity cost of the land is estimated to be about $139 million to $140 million. This is the cost to the taxpayers of leasing the land for Expo instead of either selling the land or investing it or leasing it on the market. So we're losing that money; we are losing the opportunity cost of the land. That can be justified in any analysis of the value of the land.

Upgrading of B.C.'s transportation infrastructure and related facilities, costs associated with strengthening local police forces, expanding health and inspection services — these may not all be costs incurred by the ministry or by Expo itself, but they are associated costs of the fair. The B.C. Pavilion costs — estimated costs of operation have not been disclosed, and perhaps that should be added into the overall figures in dealing with the cost-benefit analysis of the fair. The number of civil servants that are working virtually full

[ Page 6757 ]

time on the planning of the fair — those are costs that I don't believe have been accounted for. If you start to include some of those figures, it's possible, as has been suggested by a recent analysis, that the deficit may be well over $300 million, maybe somewhere between $500 million and $600 million.

Let's look on the other side of the equation — the benefit side. I want to read a statement; it's actually a quotation which is rather an interesting observation. If the minister will pay attention, perhaps he will get the gist of the statement: "Our close interdependence with other nations means that our industries, our jobs and our incomes depend on export sales. As a result, we cannot significantly affect the health of our economy by spending or consuming more ourselves." The minister may not recall where that statement comes from, but it actually comes right out of the 1984 budget speech. The primary source of Expo's fiscal impact is going to be through local expenditures. The Minister of Finance has said we cannot significantly affect the health of our economy by spending or consuming more ourselves. The result of Expo will be a possible transfer of economic activity from one area of the province to the other, and just because a dollar is spent at Expo doesn't mean that B.C. is going to realize a dollar's profit.

[11:00]

I'll give you an example. A Vancouver family that normally spends a week's vacation in the Okanagan decides to stay home for Expo. It stays home for Expo, it spends its money at Expo and it doesn't go the Okanagan. No new expenditures are created. They only have X amount of dollars in disposable income on their holidays. They blow it at Expo rather than spending it up at Penticton or Vernon or somewhere. What happens is a transfer of disposable income. People in the Okanagan receive fewer tourist dollars, Vancouver receives more. So the Okanagan's loss becomes Expo's gain. Such a distributional change does not have any net benefit to the province as a whole. It's no new generation of wealth.

By the same argument, if we attract non-resident visitors to British Columbia, for example the person in California who normally goes up to the Kootenays.... If he decides to come to Expo and spend his money there, it's not going to create any new wealth for the province. It's going to take the money that did go into the interior regions and put it into the coast — into Expo.

The conclusion, and I think the minister would agree, is that the profitability of Expo as a financial venture depends on attracting new visitors who don't normally come to British Columbia. That is what's going to create the positive economic impact of the fair. I might point out that reports distributed by Expo claim the fair will attract a million nonresident visitors. In a recent scathing reply to some statements I made in the minister's hometown area, the minister.... You remember those, do you? Totally taken out of context, but so be it. In his reply the minister said Expo's going to bring in about two million new visitors. I'd like to ask the minister how they've come to that analysis of the number of new non-resident visitors to the fair. How is the figure arrived at? Why have you doubled the figure all of a sudden? I wonder if you can explain that.

But before we go on to that, I want to point out the importance of looking at this statement that has been given by Expo that we will generate one million new tourists to B.C. Let's go through an analysis of that. Let's consider the cumulative totals — this is right out of the minister's 1984 travel indicators — of U.S. resident entries, of overseas entries and of Rogers Pass traffic for the months of May to October, which is when the fair is in operation. The total of non-resident visitors coming into the province for that period in 1984 was about — I think my arithmetic is accurate — 3.7 million. In order to attract one million new visitors, that's going to be a 27 percent increase in non-resident entries; a 27 percent jump in visitors who haven't been here before. But now let's consider something else. The minister has said that most people coming to Expo are going to stay for a number of visits. In other words, it's not going to be a one-day wonder. All right. The minister has stated that his analysis shows most visitors will be here for more than one day. So let's consider only those U.S. residents that are staying for more than one day. We'll also plug into that the overseas and the Rogers Pass traffic, along with the other indicators, using the 1984 figures. The total visitor influx in 1984 was 2.7 million for those visitors staying more than one day. You tag on one million new non-residents and you need a 37 percent increase. The minister is saying two million new non-resident visitors. That is even a higher increase in tourist volume.

Let's go back to that more conservative estimate of one million new visitors. A 30 percent increase virtually overnight is a very optimistic figure. I hope that it proves to be right, but there is a lot of concern as to the accuracy of that figure. Perhaps the minister would like to address that in terms of the analysis I've just given.

If we assume that the average length of stay as was reported was 6.36 days, the average expenditure of $37 a day, the economic benefits of one million new visitors is $238 million. As a business enterprise Expo is forecast to lose over $500 million. If auxiliary highway construction is considered, if the minister wants to play those word games, we could probably make it over a billion dollars. We're getting $238 million in new economic activity. So I think as a business venture on a sound cost-benefit analysis, the fair is not justified in terms of the deficit incurred.

If we want to look at jobs and what not, it is benefiting the province; there's no question about it. But I think as a business enterprise it's going to lose money; there's no question. The real question is: how much?

HON. MR. RICHMOND: I guess I'll work backwards through the questions. I don't know if there were questions there, but a lot of statements. I think that the $500 million figure you've come up with is from that questionable study done by the four people at UBC — I forget what they call themselves. But I hasten to point out that they didn't even have access to many of the figures regarding the Expo 86 Corporation.

MR. MacWILLIAM: They couldn't get access to them. That was the point.

HON. MR. RICHMOND: Why should they, at this point?

Interjection.

HON. MR. RICHMOND: That's right, and they are involved in the planning process of Expo. When they need to have those figures, they will have them. We're not being secretive at all, Mr. Chairman.

[ Page 6758 ]

We are doing things on a very sound business basis, and we have hired consultants and economists to do the studies for us. If other people want to do their own little studies on the limited information they have, then let them do them. But don't take the figures they publish as gospel.

I will tell you that they aren't even aware that we have done more corporate participation in Expo 86 than any other world's fair that's ever been done. We've even done more corporate participation than the 1984 Olympics, except for their television contract, which is very television-intensive as you know; it's a two-week-long event that receives tremendous television coverage. To date, Expo 86 has signed up over $140 million in corporate participation alone. Just in corporate participation, there's over $140 million.

I want to come back, though, because I really take exception to the statements about the interior of this province not benefiting from Expo. I personally have been urging communities to get on board and get their Expo committees in place for over two years, and it has been very successful. Working with Expo, with a division headed up by one Ms. Maire Shaw, who has done an excellent job, we now have 83 communities on board in British Columbia with their own independent Expo committees planning events in their own areas and communities to take place to coincide with Expo.

Why are they doing this, Mr. Chairman? So that we as Tourism B.C., when we're in the B.C. Pavilion, where we will have a large presence, can encourage the people, the visitors to this province, once they have spent their days at the fair — whatever that may be, maybe two days, three days, four days.... I think the projection is that the average family will spend three and a half days at the fair. But they will spend a lot more than that in British Columbia. It ranges anywhere up to 11 to 14 days, and some will even be here for three weeks, depending on the distance they travel. We intend to keep those visitors in this province, Mr. Chairman. And to get them throughout the four comers of the province, if you like — into the Okanagan, into the north country, into the Kootenays, to Vancouver Island — to spend the rest of their holidays here, we have the assistance of 83 communities in this province putting on special events and spending a lot of money that they have raised themselves to entice the visitor into their area. Some of them are going to be extremely successful. The Cariboo is recreating the gold rush. Islands 86 have raised in the neighbourhood of three-quarters of a million dollars by their lottery that they had, raffling off an island or giving away an island in a lottery, just to promote Vancouver Island next year.

So the spirit is there. These communities aren't sitting out there with the doom and gloom message that I hear from over there saying: "Expo is only going to benefit the lower mainland, and it's going to drain all our visitors. They're going to go to Vancouver instead of staying here." Maybe they're going to go to Vancouver instead of going down to Washington and Oregon, Mr. Chairman. Maybe the Vancouver family that is going to stay at Expo is going to stay instead of going elsewhere. Maybe they wanted to go to Winnipeg, and they're going to stay in Vancouver because Expo is on. They don't talk about that side of it. It's only the doom and gloom that the family staying in Vancouver is not going to benefit, because they're going to be spending their own dollars. Of course they are; they're going to be spending them here instead of somewhere else.

The member has talked twice about the decommissioning costs of the fair. Surely he must know that the people putting on Expo 86 have tremendous expertise in what they are doing. We're not trying to reinvent the wheel, you know; the wheel was invented years ago. We are learning from the mistakes and the wise moves of others, Mr. Chairman. We've studied every world's fair and the Olympics, both in Montreal and in Edmonton with the Commonwealth Games, to see what people have done right and to see what they have done wrong. We hope not to repeat their mistakes. I don't think we will. We hope to do things as well or better than the best, and I think we are.

I spoke about the spinoff in the construction industry, Mr. Chairman. I want to make it very clear that that $900 million figure wasn't my own. It came out of the Vancouver Sun, and it does not include any public sector construction. That is private sector construction alone, triggered by Expo 86.

[Mr. Veitch in the chair.]

The other thing, just to clear up the costs of land that is owned by the B.C. Place Corporation: that land cost the B.C. Place Corporation roughly $8 a square foot. The going price of that land, when you can sell it, Mr. Chairman, is in the neighbourhood of $300 a square foot. The member says: "Would we be better off renting it at this time or selling it rather than putting on Expo?" I think if you just think about it a moment, the answer is obvious. I don't think it could be put to a better use.

MR. MacWILLIAM: You haven't included that cost in your analysis.

HON. MR. RICHMOND: You don't know, Mr. Member, whether we have included it in our analysis or not.

MR. CHAIRMAN: Please address the Chair.

HON. MR. RICHMOND: I'm telling that member that at this moment we couldn't be putting it to a better use. For the last two or three years.... I don't know about you, Mr. Member, but I know that a lot of people have had a lot of trouble disposing of land and property in downtown Vancouver. So what better use to put it to than on a world exposition — put in the required services and then late in 1986 turn it back to the landlords so they can get on with probably the most exciting urban renewal project ever undertaken. I guess that answers most of the statements.

MR. MacWILLIAM: The minister continues to be so doggone evasive about a lot of these things. As a person who is supposed to be a hard-nosed businessman — apparently; I don't know, but he likes to come on that way — he has been awfully dammed evasive in terms of hard facts and figures on this whole dammed thing. I've asked the minister to table the cost-benefit analysis. He keeps ignoring the question. He refuses to deal with figures. I've come across here with some reasonable analysis. All he wants to talk about is putting on the rose-coloured glasses and how everything is going to be great. Come on, Mr. Minister! Let's deal with the reality of facts and figures. When I mentioned the opportunity cost of the land.... That's a simple calculation made in any cost benefit analysis. You have to consider that. I'm not saying go sell the land or rent it. I'm saying: have you considered that in your overall analysis of the fair? I don't know. You won't tell me. You won't tell anybody. All we're asking for are some

[ Page 6759 ]

facts and figures. We want to see the fair be successful as much as anyone else. But goldarnit, Mr. Chairman, let's deal with some facts and figures around here instead of a lot of hot air, pomp and circumstance. It's time we got down to some hard-nosed dealing here.

I maintain my statement that if we include these hidden costs — decommissioning the site, the cost of the land, opportunity costs, upgrading of the infrastructure, strengthening the local police, health and safety, etc. — we're going to run a higher deficit than the chairman has predicted, a deficit that may be in the neighbourhood of $500 million to $600 million. We're going to add that deficit onto an accumulated deficit of over $17 billion, which this government has generated in the past decade throughout British Columbia. We've now got the sixth consecutive deficit budget. There's no question about the fact that this government is involved in deficit financing; they just won't admit it.

[11:15]

The real question in terms of fiscal policy is: what's going to be left after the fair? I fully agree that we are creating jobs, economic impact and economic spinoff; I'm not arguing that point at all, Mr. Minister. For that reason I reiterate that my colleagues and I support the fair. My criticisms are not gloom and doom; they're based on some hard-nosed figures which I think we have to deal with and which this government refuses to deal with in terms of accountability to the public purse. What remains after Expo, except the hollow shell? Although the job creation benefits of Expo are there, they are short-term. This government's entire fiscal policy is short-term. It can't think in terms of long-term economic reconstruction. It can't think past the next election agenda. That's the problem.

The minister says that we're going to pull all these international businessmen from around the world to visit the fair, and that as a result of that, they're going to be so attracted to British Columbia they're going to make all their investments here, and we will be the recipients of a massive influx of venture capital. Well, Mr. Chairman, I might point out that the only way you're going to enhance a region's trading position in the international market in the long run is through that region producing higher quality goods at as low a cost as possible. That's how you enhance a region's international trading position. That's the only way you do it. We will become higher profile as a result of Expo, but until the economic policies of this government are such that they show the people of the world that the British Columbia economy is on the right track, has some long-range planning, and is set to diversify in a stable manner into secondary manufacturing, the international investors of this world will not come to British Columbia. They will not come because of any glitter and gloss. Sound economic policy, that's what they want. Political stabilization, that's what they want. Cooperation, that's what they want. They don't need the glitter and gloss. It's nice. It'll bring them here, but we need to offer them far more than that, and the minister knows that very well. It's the only way we're going to enhance our trading position, increase productivity, increase diversification and increase political stability in this province. Let's get out of the Third World dark ages.

Now the minister has also said that this side of the House is preaching gloom and doom as a result of my statement suggesting that we may have a redistribution of income in this province drawing tourist dollars away from other areas of the province into Expo. That's a reality that has to be looked at. I fully agree with the minister, even though he's not listening again, that we have to make every attempt feasible, every attempt possible, to generate regional projects, if you like, during that time of Expo to ensure that those regions, as much as they possibly can, will entice that tourist dollar to also come up and visit, for example, the Okanagan, the Kootenays or the Cariboo. Certainly we have to do that. If we don't do that — if we don't make every attempt to do that — my fear is that we will get a redistribution of income in the province. I'm not saying that will happen, but the potential is certainly there.

Now in discussing that very problem with the member earlier in this session of the House, I suggested that one of the problems in the Okanagan area, as a result of environmental problems with groundwater pollution and increased nutrient loading in the Okanagan Lakes basin, is that we have a problem with water quality up there. The water quality in the Okanagan Lakes basin is decreasing yearly.

Yes, I'm on track, Mr. Minister, because I'm just going to make reference to a statement....

MR. CHAIRMAN: Order, hon member. The Chair will listen to see if you are.

MR. MacWILLIAM: Thank you.

I had requested the member, in light of the fact that the Okanagan is attempting to generate as much interest in light of Expo 86, and to market itself as a tourist destination point.... I had asked the minister if he would join me in attempting to resolve this problem we have with the milfoil growth in Okanagan Lake. The minister refused to come along with me and request that we consider expending more money to clean up the lakes for Expo.

MR. CHAIRMAN: It is the Chair's opinion that you are straying off the responsibilities.... It may be a personal situation between you and the minister, but it is not appropriate at this point in time, hon. member. That is the Chair's decision.

MR. MacWILLIAM: In response to the Chair's judgment, to clarify myself, what I am trying to attempt to do....

MR. CHAIRMAN: There is no response to the Chair's judgment.

MR. MacWILLIAM: Okay.

In light of the minister's statement of not giving consideration to the other areas of the province, the point I'm trying to make is that we must take every opportunity to create those regional tourist promotion programs in order to ensure that the tourists we do attract to British Columbia in fact do leave the lower mainland area and visit these other areas. If we don't take every opportunity to do that, we will be in a situation where the tourist dollar will leave those areas and come down to Expo. That is my concern.

Just to summarize where we've come to at this point, we've looked at three aspects of Expo 86: we've analyzed it in terms of its historical antecedents, and we've analyzed it in terms of a business venture and also as a fiscal policy. I think if you look at those three aspects, Expo doesn't perform that well. Upon studying previous world's fairs we found that they are money losers; 15 out of the 18 previous world's fairs have

[ Page 6760 ]

been money losers. I might point out to the minister, through you, Mr. Chairman, that that is called a deficit.

As a business enterprise, I maintain that Expo may lose up to $500 million to $600 million when you consider the hidden costs and auxiliary expenditures. Lastly, as a fiscal policy Expo 86 will have immediate benefits of short-term job creation, but my fear is that it's a quick fix and it has no long-term, lasting benefits in terms of creating an investment climate in this province, economic diversification or engendering any type of overall industrial development strategy.

I think I'll let the minister respond to those comments at this point.

MR. CHAIRMAN: Shall vote 65 pass?

MS. BROWN: No, he's going to respond. He sat down so the minister....

MR. CHAIRMAN: Order, hon. member. I asked the question "shall vote 65 pass?" All right, the hon. member for Okanagan North.

MR. MacWILLIAM: Some specific questions to the minister, questions that he has not responded to; I will address them once more. When will the minister provide a detailed cost-benefit analysis — a budget — of the fair? The summary information attached to Mr. Pattison's January 26 news release is incomplete and is impossible to compare with other documents.

If we look at Currie, Coopers and Lybrand of Toronto, they've done a series of economic studies for the fair. One such study tracks the economic benefits, and that has been released. The figures contained in it don't compare to the figures contained in Mr. Pattison's report, and I ask the minister if he has decided to table the other Currie, Coopers and Lybrand report, and make it available to the public.

One of the reports deals with the site decommissioning costs, and in view of the finding of the Economic Policy Institute that such costs have been cause for financial problems in a number of other world's fairs, will the minister table this study?

Mr. Chairman, it will just be a long, hot summer if the minister simply refuses to answer. I've asked him some very specific questions in terms of public accountability of this fair, and the minister has the audacity and the arrogance not to even answer.

MR. CHAIRMAN: Order, please, hon. member. Shall vote 65 pass? The hon. member for Burnaby-Edmonds.

MS. BROWN: Has the minister been instructed not to respond to any more questions? Is he being coerced and bullied into sitting in his seat and not participating in this debate? Is that what we're witnessing?

Interjection.

MS. BROWN: Well, then, stand up and answer the questions if you're not being bullied.

HON. MR. McGEER: Mr. Chairman, it seems as though all three members of the opposition present are outraged. I want to tell you that the turnout of the opposition for this scintillating debate would embarrass the inside postal workers' union of Canada. I think, really, what we should be considering .... I see, Mr. Chairman, an honoured guest on the floor of the House today, and I'm sure how embarrassed he would be to know that during a debate we couldn't turn out more than three members of the opposition.

MR. CHAIRMAN: Hon. minister, could you reflect this upon the minister's vote? I'm waiting for that.

HON. MR. McGEER: I'm speaking not just to the minister's vote, which of course is what the debate here is all about, but to the absurdity of the process whereby the legislative time is absorbed in estimates for the benefit of a couple of members who have expressed their outrage, another who has wandered in, and one who is taking part in the debate.

MR. MacWILLIAM: On a point of order, Mr. Chairman, the hon. member is not talking to the estimates debate. He's standing up and making a....

AN HON. MEMBER: That's up to the Chair to decide.

Interjections.

MR. CHAIRMAN: Order, please. The comments are well taken, hon. minister. Would the minister please proceed.

HON. MR. McGEER: I think the big problem.... After we've had some genuine debate on the estimates, maybe a few more of the members will come in because there's something relevant and important to say. But I would say to the member who is protesting loudly over there that if he can't even get his own caucus to come out and listen to the questions he's asked, it can't be very interesting or important. That's the difficulty — even the NDP caucus thinks it's trivial. Should the process of estimates appear before this Legislature at all, or should it be before a committee? You get better turnouts to the committee.

Interjections.

[Mr. Chairman rose.]

MR. CHAIRMAN: Order, please. Please take your seat, hon. minister. On vote 65, the hon. minister proceeds. The minister's estimates and his responsibilities, please.

[Mr. Chairman resumed his seat.]

HON. MR. McGEER: Mr. Chairman, the tourist industry is one of the brightest spots for the future that we have in our province.

Interjection.

HON. MR. McGEER: Luckily we don't have the NDP in power, so we don't have that tremendous fear for our resource industries that existed when the member opposite had charge of the forest industry and brought worldwide anguish and despair. There is the greatest threat to our economy in British Columbia, saying that it's one of the few bright spots. I tell you, if they were in power it might be the only industry left in British Columbia.

[ Page 6761 ]

MR. BARNES: On a point of order, Mr. Chairman, I think the minister is abusing the rules of the House, and I would ask that you have him come to order, please.

MR. CHAIRMAN: I would caution all hon. members that relevancy is most important in debate.

[11:30]

HON. MR. McGEER: Is it inappropriate, Mr. Chairman, to point out that tourism might be one of the few industries that the NDP could damage? I well recall the period when the NDP was in power, when the Minister of Highways for the New Democratic government said that we didn't want all those U.S. campers on our roads.

MR. WILLIAMS: What a hack you've become.

HON. MR. McGEER: Well, I tell you, Mr. Chairman, there's a lot of difference between becoming a political hack and selling your seat for $80,000, and becoming responsible ministers, asking for responsible debate in the Legislature and asking people who come in and take up the time of the House with estimates to have some important messages to bring forward.

MR. CHAIRMAN: Order, please, hon. minister.

HON. MR. McGEER: Nothing is more important than tourism, and that's why I'm up here speaking for tourism in British Columbia.

MR. BARNES: Just as a matter of fairness, Mr. Chairman, I think if the minister is going to reflect on the sale and value of other members, he should remember that he sold his soul to go on that side of the House.

MR. CHAIRMAN: Order, please. Is the hon. first member for Vancouver Centre imputing any wrongful act? You would withdraw that. Thank you.

MR. BARNES: No, no imputation, Mr. Chairman.

HON. MR. McGEER: Mr. Chairman, I don't take offence at the remarks of the member for Vancouver Centre. But I can tell you that no group in British Columbia could have better demonstrated the perils of those who believe in the private enterprise system indulging in a division...than the performance of that party in power. Even the tourist industry....

MR. CHAIRMAN: Order, please. The Chair has tried to be reasonably lax in its approach to this. Hon. minister, even the economics of Expo perhaps would not be discussed, but perhaps the administration of Expo would be closer to relevancy in debate here. So would you become relevant please in this debate on vote 65.

HON. MR. McGEER: I want to say how pleased I am to learn that there actually were some of the NDP members present in the House, and they're here now to listen to the answers that I'm sure the Minister of Tourism will give to those asked by the member opposite.

MR. MacWILLIAM: I find it interesting that we were involved in a very detailed debate here, discussing the pros and cons, of a budget analysis, and the hon. minister walks in here and throws el toro poo-poo all over everyone. There's always a little bit that sticks, though, when you throw it, Mr. Minister.

MR. CHAIRMAN: Order, please, hon. member. Back to relevancy in debate.

MR. MacWILLIAM: The comment that was made, that my colleagues have no interest in it, is I think totally out of line. I feel it's a vote of confidence from my caucus in my ability to handle the questions and to handle that minister over there, and I'm proud of it.

MR. CHAIRMAN: Back to the relevancy of vote 65, the administrative responsibilities of the Minister of Tourism.

MR. MacWILLIAM: Once again, when is the minister going to provide a detailed budget, cost-benefit analysis, for the fair? The study by Currie, Coopers and Lybrand indicates that studies have been released. These studies don't seem to be in agreement with statements made by Mr. Pattison. Is the minister going to respond to my request for the tabling of a cost-benefit analysis for Expo 86?

MS. BROWN: Answer the question.

MR. MacWILLIAM: Could be a long hot summer, Mr. Chairman.

AN HON. MEMBER: Keep going!

MR. MacWILLIAM: Why does the minister continue to withhold critical evidence in terms of contract documents for Expo 86? Will he come clean with the $75 million Specialty Mfg. contract and make that part of public information? I discussed this issue with the Premier yesterday during other discussions in the House. The Premier said that he would investigate the matter. I wonder if the minister would care to comment in light of those discussions that have now taken place. Will he make public the full details of those contract documents with Specialty Mfg., which have virtually given them a hammerlock on the sale and servicing of souvenirs and materials for the fair?

MR. WILLIAMS: Maybe the minister could advise us, Mr. Chairman. If my memory serves me right, Expo anticipates something like $200 million in food revenues — sales in terms of food and the like. Does my memory serve me well or not? It was some months ago that I looked at those actual estimates, but it was a very substantial amount. Those were sort of net returns, I believe.

When I reflect on that, it starts clarifying — for me, at least, a resident of the city of Vancouver — the issue of the north gate in terms of Chinatown. It becomes very clear to me that the primary reason we don't have a north gate at Expo is the access it would provide to probably the finest group of restaurants in greater Vancouver, and that would be right at the north gate entrance/exit. Vancouver's Chinatown would have been right there at the north gate. The gates for Expo are in isolated parts of the downtown area and the False Creek rim. The gates are in fact at Terminal Avenue, and if anybody

[ Page 6762 ]

knows the city, Terminal Avenue is not an area where you get any pedestrian traffic to speak of at all.

MR. REID: It's right on the ALRT.

MR. WILLIAMS: Yes, it'll work in terms of the ALRT, but it is not a pedestrian area. For those who go to the American Hotel it's a pedestrian area, but they generally don't walk very far.

MR. REID: You get on the buses right there.

MR. WILLIAMS: That's the member for Surrey talking. He probably doesn't see that sophisticated city of Vancouver very often. He bypasses it most of the time. That's understandable, because they are a little sophisticated, and our redneck friend has trouble every time he goes there.

At any rate, the other major gate is in the Yaletown area, again in sort of the industrial fringe of the downtown at the bottom end of the central business district; that's the major gate, near the roundhouse. That leaves that huge gap, in terms of the whole swath of the fair boundary in terms of Chinatown. I found myself asking: why has the minister been willing to take the political flak that he received at an earlier stage about the closing of the north gate? I had to reluctantly come to the conclusion that it was for fiscal reasons internally at Expo more than anything else, because he didn't want the competition from Vancouver's Chinatown in terms of food sales at Expo. In fact I think that's so.

So then you ask yourself: if you buy a ticket for Expo, do you have in-and-out privileges? Because, I'll tell you, if I went into Expo and I had in-and-out privileges, I would use that north gate and go and have lunch or dinner in Chinatown and then go back into Expo. I think tens of thousands of people would do the same. I think the people on staff at Expo figured that out themselves. They didn't want that kind of competition at all. You either drop those people out at Terminal Avenue or you drop them out in Yaletown, and that's a long walk to Chinatown. That's what's really happened in terms of that north gate. So this important ethnic community, which could have been a significant part of the whole Expo adventure, to a great extent has been closed out. They've been closed out like the small businessmen that the member for Okanagan North (Mr. MacWilliam) has been talking about. So the loss is there; the loss is there in terms of Woodward's stores, Chinatown, the historic area of Gastown, that north gate.

While most people have been enthusiastic about Expo, particularly those in business who thought there would be the spinoff — spinoff promised by the Premier and the minister — when the critical time comes they're cut out. They're cut out by some foreign trader, by the Yankees getting control of all of the concessions for the souvenirs; they're closed out in terms of the north gate as well. While there could have been far more spinoff, far more benefit outside the fair, in fact the benefits are far less than people anticipated.

HON. MR. RICHMOND: I think I'll pick up on the last remarks that the member made, and I quote I think fairly accurately: "The Yankees are getting control of the souvenir market." They love to beat that one to death. First of all, the firm in question is Specialty Mfg., which has been doing business in British Columbia for many years. Granted, the control of that corporation is in the United States, but I reiterate that the deal made with them is far and away the best deal that could possibly be made for the corporation. They quote the figure of $75 million continually, but neglect to say that that contract will benefit the Expo 86 Corporation in the amount of about $22 million.

Now let me go on to talk about the British Columbia businesses that will be doing business with Expo through Specialty Mfg. The member for Okanagan North mentioned that. His term was: "Specialty Mfg. has a hammerlock on the souvenirs." Having done just a little bit of research in the last day or two, I'd like to share some information with the House. I'd like to start with an article that appeared in the newspapers regarding the T-shirt sales and the imported T-shirts which the opposition made so much of in the last few days. I want to put that into the proper perspective.

First of all, when a firm such as Specialty wants to change the quota on T-shirts coming from any foreign country, they must approach the federal government for permission to increase their quota. Having done that, the federal government tells them to approach the manufacturers in Canada for permission to increase the quota.

[Mr. Ree in the chair.]

I wish to inform the House, Mr. Chairman, that Specialty Mfg. did just that: they approached the federal government to increase their quota of T-shirts coming from the Pacific Rim. They were told to deal with firms and trade unions in the Canadian textile industry to get their permission. They were flatly turned down by those corporations and trade unions several weeks before the story appeared in the media saying that they were going to buy a million and a half or more T-shirts from Korea. The media, I submit, knew full well that that was not the case, that their quota was 300,000 and that's where it was going to stay. So any allegations or stories to the contrary — that they were going to buy some millions of T-shirts offshore — are simply not true and haven't been for some time.

Now I would like to list just a few of the companies in British Columbia and in Canada who are going to be doing business with the Expo 86 Corporation through Specialty Mfg. This is to counter the claim from Vancouver East and the hammerlock from North Okanagan that the Yankees are getting control. Great West Graphics of Vancouver will be doing the graphic work for them. Pressed Metal Products will be making jewelry — that's another Vancouver firm, Mr. Chairman. Maybe some of the members from Vancouver aren't familiar with these firms, but they are from Vancouver. Agency Press of Vancouver will be doing the postcards. Evergreen Sportswear in Vancouver will be supplying T-shirts to Specialty for Expo. Anglo-American Leather of Vancouver will be doing the bulk of the leather products. Allied Store Equipment of Vancouver will be doing the fixtures for Specialty Mfg. Procambium of Vancouver will be doing the cabinets. Gerrebe Display Ltd. will be doing all their displays. A well-known name in Vancouver, Ms. Susan Mendelson, will be doing the cookbook for Specialty Mfg. She's a Vancouver resident, in case I forgot to say that. Allied Office Supplies will be supplying all the office equipment and supplies for Specialty. The Canadian Mental Health Association in Vancouver will be doing all the packaging for Specialty Mfg.

[11:45]

[ Page 6763 ]

If I want to move outside the province into other Canadian firms, Century Promotions of Montreal will be doing the bronze work; the GH Group of Toronto will be doing T-shirts; Libby St. Claire of Ontario will be doing most of the glassware for Specialty Mfg.; Cutler Brands of Toronto will be doing glass and T-shirts; Sovereign Inc. will be doing jewelry — they're from Ontario; Trench Canada Ltd. will be doing all the pennants — they're from Ontario — for Specialty Mfg; International Insignia will be doing all the crests and patches for jackets, etc.

Those are just a few of the companies. There are some that they have asked me not to mention because they have...on an exclusive basis. But I'm sure that if people wanted to phone the management of Specialty Mfg., there are many more firms than this. That's only a partial list, Mr. Chairman, of the firms in British Columbia and in Canada that will be doing business with Expo through Specialty Mfg.

I am told by the management at Specialty that they will be choosing about 1,500 items to market at Expo, both on and off the fair grounds. They calculate that they will be reviewing some 15,000 items. They will be reviewing and looking at some 15,000 and choosing 1,500. So I'm sure, Mr. Chairman, that people can realize that it is virtually impossible for everyone who makes something to do business with Expo 86. But it's hardly the doom and gloom picture that's been painted across the way, that no B.C. firm or Canadian firms can do business with Expo.

I don't have the figure at my fingertips on the food revenue that the member asked. I will try to get that for him before my estimates wrap up in a few minutes.

SOME HON. MEMBERS: Oh, oh!

HON. MR. RICHMOND: They're going to wrap up, as far as I'm concerned; maybe not as far as you're concerned, but they are as far as I'm concerned.

Interjections.

HON. MR. RICHMOND: No, I'm leaving. That's all I've got to tell you. I have important things to do elsewhere.

Interjections.

HON. MR. RICHMOND: I didn't say "more important." I said I have other important things to do elsewhere. So if we don't get finished today, I'll be happy to see you next week or the week after or the week after. You won't hurt my feelings, Mr. Member, if we're here in August. It won't bother me a bit.

MR. CHAIRMAN: Order, please. Remarks should be through the Chair, and not directed to other members.

HON. MR. RICHMOND: I'll be very happy to sit here through July, August and September to get through these pertinent questions.

The member for Vancouver East makes an allegation again that is simply not true: that we decided not to proceed with a north gate because of the restaurants in proximity to Expo. Nothing could be further from the truth. I don't know where he dreams these up. I think they must come to him in some kind of weird vision in the middle of the night sometimes.

The north gate at Expo was cancelled strictly for fiscal reasons, strictly because we did not have the budget to proceed with it. It was made strictly for financial reasons. I don't have the figure at my fingertips, but it was in the order of close to $50 million, and I stand to be corrected, that we had to save by shutting down the whole north section of that fair — not just the gate, but the whole section from the Georgia Viaduct north, after taking a very close look at the budget. It wasn't an easy decision to arrive at. These decisions aren't taken lightly. It was decided to save that roughly $50 million by shutting down the north side of the fair. Yes, the cost of only putting in a gate was in the neighbourhood of $2 million, but it created many other problems which the people and the engineers at Expo said we just could not overcome by putting a gate there.

The member also forgets, conveniently, another gate. He leads the House to believe that there's the Yaletown gate by the CPR roundhouse, and the next one is way over on Terminal Avenue. He has forgotten the stadium gate that is between those two, not very far from where the north gate was. A little further, granted, but he conveniently forgets the stadium gate, one of the largest gates at the fair. "Oh," he says — very convenient — "I just forgot that." It's like forgetting to talk about the $3 billion in economic activity when you talk about a cost of $300 million. It's convenient to forget the other side of the ledger, Mr. Member.

He talks about having the in-and-out pass privileges at the fair as if we're going to go back to the first fair that was ever put on and reinvent the wheel. Of course the people will be able to pass in and out of the fair. Not only that, they'll be able to get on the ALRT and ride it at no charge around to the Canada Pavilion on Burrard Inlet and go back and forth as many times as they want. So I think questions like that are of a very specious nature. I think they must come to him in some kind of vision in the middle of the night.

I don't want to leave the impression with this House or with anyone else that there are only two gates to the world's fair in 1986. He also forgets about the gate at the Canada Pavilion that people can enter and ride either by ferry or by ALRT at no charge, or take a leisurely stroll through Gastown and Chinatown and arrive at the stadium gate at the fair.

MR. MacWILLIAM: Mr. Chairman, we have a project here through Expo 86 that has been a major economic thrust of this province for the past few years, and will be until it closes. We have a public expenditure of over $802 million going into this fair; an overall budget of $1.5 billion. It's our one big apple in the economic pie, our one big hope for a grasp at economic recovery, and this minister is refusing — absolutely refusing — to table any of the details of the cost benefit analysis of the fair that has been done. He is refusing to table the details of contracts that have been let without competition to Specialty Mfg. — a $75 million contract. He is refusing to table the details of the cancellation of the bid for the opening of the fair when they decided to hire the gentleman from California. He won't give us any information as to why that decision was made. He will not show the audited statements of the expenditures of Mr. Bartlett since the incident with the purchase of the Mercedes-Benz and secret meetings down in California. He has failed to make public the contracts for the supply of the magazine for the fair. He is refusing to make public those contracts and expenditures that

[ Page 6764 ]

should be made public, because Expo 86 is a Crown corporation and he's indebted to the public for a full accounting of his expenditures and carryings-on.

The minister has said that there's adequate Canadian participation in the provision of souvenirs and supplies to the fair. I want to relay to the minister an article that appeared in the Sun only today, and I'm going to quote from it:

"A Korean delegation listened silently Tuesday while B.C.'s garment manufacturers urged the Canadian government to restrict an application to import 1. 5 million Korean T-shirts for Expo 86. To the manufacturers, the T-shirt deal is one more blow to an industry employing over 12,000 British Columbians. Henderson said layoffs are increasing; manufacturing plants are running at 50 percent below capacity.

"Expo Souvenirs, operated by U.S.-owned Specialty Mfg., can obtain quota to import 300,000 T-shirts from Korea. The U.S.-owned company has applied for the federal government to import an additional 1.2 million shirts outside the normal quota restrictions."

That's only today, and the minister is saying that the British Columbia industry has plenty of opportunity to bid. Well, here's the industry saying that that is not correct, that they're losing out. Why should the Korean firms have access to so much of the supply?

Going back to my original question, I want to re-emphasize this question because I want to get some answers from this minister. When is this minister going to table and make public a detailed cost-benefit analysis of the fair? When is he going to make available the details of the contract to Specialty Mfg.? When is he going to make public the details of the contract to supply the souvenir magazine for the fair which was let without full public bid? When is he going to make the details of this information available? I reiterate to the minister that it is of public concern; there is an outcry out there in both the media and the public that you are hiding information from us. It raises a lot of questions as to what the devil is going on. I think as a matter of public responsibility you should supply this information.

Mr. Chairman, in light of the time, I would at this point move that the committee rise, report progress and ask leave to sit again.

The House resumed; Mr. Strachan in the chair.

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

Hon. Mr. Nielsen moved adjournment of the House.

Motion approved.

The House adjourned at 11:56 a.m.