[ Page 8129 ]

CONTENTS

Tabling Documents — 8129

Oral Questions

Pentachlorophenol plant. Mrs. Wallace — 8129

Government advertising. Mr. Hanson — 8129

Lottery funds. Mr. Hanson — 8130

Westar Timber. Mr. Lea — 8130

Sunday drinking laws. Mr. Ree — 8130

Gordon Neighbourhood House. Ms. Brown — 8130

Private Members' Statements

B.C. cruise ship industry. Mr. Parks — 8131

Hon. Mrs. McCarthy

Mr. Williams

British Columbia film industry. Mr. Reynolds — 8133

Mr. Williams

Hon. Mrs. McCarthy

UBC entry limitations for Malaspina College students. Mr. Stupich — 8135

Hon. R. Fraser

Royal visits. Mr. Macdonald — 8136

Hon. Mrs. McCarthy

International Commercial Arbitration Act (Bill 20). Committee stage. (Hon. Mr. Smith) — 8138

Mr. Nicolson

Mr. Lauk

Third reading

Commercial Arbitration Act (Bill 22). Committee stage. (Hon. Mr. Smith) — 8139

Mr. Lauk

Third reading

Committee of Supply: Ministry of Energy, Mines and Petroleum Resources estimates. (Hon. Mr. Brummet)

On vote 20: minister's office — 8139

Mr. Lockstead

Ms. Sanford Mrs. Wallace

Appendix — 8147

FRIDAY, MAY 9, 1986

The House met at 10:05 a.m.

Prayers.

HON. MR. WATERLAND: Mr. Speaker, in the precincts today, and later to be joining us in the House, are 20 students from the band class of Princeton Secondary School, accompanied by their teacher Mr. lannacone and by Mr. Dave Atkinson. I would ask the House to join me in making them welcome.

HON. MR. KEMPF: In the members' gallery this morning is a fellow who is known well around these precincts, Mr. Jack Kelly. Accompanying Mr. Kelly this morning is a visitor to our province all the way from Houston, Texas, Mr. Barry Snyder. I would ask the House to make them very welcome.

Hon. Mr. Waterland tabled the 1984 annual report of the Ministry of Agriculture and Food.

Mr. Speaker tabled the 1985 annual report of the ombudsman.

Oral Questions

MR. HANSON: I have a question for the.... The Provincial Secretary (Hon. Mrs. McCarthy) was here and then disappeared. I'll redirect the question to the Minister.... Mr. Speaker, I'm going to yield to the next speaker, in anticipation of the Provincial Secretary coming back.

PENTACHLOROPHENOL PLANT

MRS. WALLACE: My minister is always here — a question to the Minister of Environment. His ministry staff are presently, I understand, reviewing an application from Bradbury Industries to construct a plant to manufacture pentachlorophenol at Lone Butte in the Cariboo. Inasmuch as the Minister of Transportation and Highways (Hon. A. Fraser) has said that he's going to quash that application, has this minister decided to so instruct his staff and ask them to discontinue their investigations?

HON. MR. PELTON: Mr. Speaker, the answer is no, but I'll explain a little further than that for the benefit of the hon. member. There is a process which we go through on applications of this nature, and I think in fairness to everyone we should let the process follow its regular course. However, I have instructed the ministry that before any definite decision is taken I'm to be notified.

MRS. WALLACE: Well, it's interesting that the minister is prepared to spend the kind of money it must take to go into this review, when the minister who is the representative for that area has said no, it will not go forward. I'm wondering whether the minister is prepared to tell us at this point whether he is going to take any action to ensure that that plant will not go forward once his investigation is completed.

MR. SPEAKER: Future action, hon. member.

MRS. WALLACE: Has he decided to do that'?

MR. SPEAKER: Has he decided on future action? The minister.

HON. MR. PELTON: Mr. Speaker, I should have mentioned when I was on my feet previously that I am aware of the feelings of the Minister of Transportation and Highways on the subject, but 1 must add that in some correspondence I had from him he agreed that the normal process should be allowed to take place with respect to the application for the permit. l won't know what action I'm going to take until I get a report from the ministry.

GOVERNMENT ADVERTISING

MR. HANSON: Mr. Speaker, a question to the Provincial Secretary. A number of my constituents, and I'm sure people all around the province, would like to know how much the saturation advertising campaign selling the provincial budget cost. On March 24 the minister said she would investigate the cost of the political ad campaign and report to the House. The question is, in the intervening six weeks, has the minister been able to locate the information?

HON. MRS. McCARTHY: Mr. Speaker, I'm very pleased to have the question re-asked, because I have been trying to get some time to respond to the member's question. First of all, the member for Victoria has asked for information relating to the television and radio messages. Government information services, under my ministry, is responsible for the placing of government information and advertising, and their budget allocation includes funding for all ministries of the government — not just this ministry but all ministries. Fifty-three percent of the information budget is allocated to the Ministry of Tourism to help promote our British Columbia worldwide. As you would know, that would be a very large part of the budget the member refers to.

The opposition seems to want to convey the impression that government information services exists as a single entity whose only function is to produce TV and radio advertising material. That's isn't true, Mr. Speaker.

lnterjections.

HON. MRS. McCARTHY: I'd be very pleased to continue with the response to the question, Mr. Speaker, if the members would let us.

As I say, 50 percent of the advertising budget goes to the Tourism budget. The Attorney-General, Agriculture and Food, Counterattack and safety and reports of boards and commissions — all of those are done. Consumer and Corporate Affairs, Forestry, Health, Human Resources, Education, Environment, Labour — every actual member of the government that has a portfolio has a budget for it.

MR. SPEAKER: With the greatest respect, I must ask the minister to either respond to the question....

HON. MRS. McCARTHY: Mr. Speaker, the actual amount of money is in the budget shown in the accounts and will be debated during my estimates, and it is a full amount of money. I think that was the question asked. The member knows the amount of money in the budget, I'm sure, because

[ Page 8130 ]

he's been looking at those accounts. I believe that was the question that he wanted answered: where does the money come from? It comes out of my ministry...

MR. SPEAKER: Order, please.

HON. MRS. McCARTHY: ...for all ministries, and it is prorated between the ministries, and that amount of money will be made available during the estimates.

MR. HANSON: Mr. Speaker, the people of this province are wearying of being partners in propaganda with the Social Credit Party. If you think they've seen something happen in Alberta, wait until just shortly in this province.

HON. MR. KEMPF: Fifteen is all you'll get.

MR. HANSON: You want to bet your hot-tub on it?

LOTTERY FUNDS

MR. HANSON: Mr. Speaker, I have a new question to the same minister. Another matter of great concern to the people of this province is what happens with their lottery money. The quarterly reports that indicate the disposition of the various lottery funds has not been published in this province for over a year. The last quarterly report of the lotteries branch, which covered the third quarter of 1984-85, was issued in February 1985. There has not been a quarterly report in a year. Will the minister advise what the government is trying to hide by its refusal to publish quarterly reports on lottery disposition grants?

[10:15]

HON. MRS. McCARTHY: Mr. Speaker, I am really amazed to hear this question, and I will certainly take this question as notice and come back and find out about the publishing of quarterly reports. I'll be very pleased to do that. I'm surprised to hear the question, and I'd be very delighted to get the answer for you.

WESTAR TIMBER

MR. LEA: A question to the Minister of Forests. Does the minister have any knowledge of any negotiations going on between Westar Timber and any company for the purchase of the Prince Rupert pulp mill, the tree-farm licences that Westar holds, or any sawmills in the northwestern part of the province?

HON. MR. HEINRICH: Mr. Speaker, I gather that question was asked yesterday. It was taken as notice, and I would be pleased to investigate the matter and bring an answer back to the House.

MR. LEA: Yesterday, Mr. Speaker, I asked the Premier and the Minister of Finance (Hon. Mr. Curtis) whether they had any knowledge, and they said they would take it as notice. What I'm asking today of the Minister of Forests is whether he has any knowledge of any...?

AN HON. MEMBER: The parliamentary secretary....

MR. LEA: That was not asked.

Does the Minister of Forests have any knowledge of any negotiations for the sale of the Prince Rupert pulp mill, treefarm licences owned by Westar, or any sawmills owned by Westar? Are there any negotiations going on that the minister knows about?

HON. MR. HEINRICH: Mr. Speaker, I thought I said that I would take the question as notice and report back to the House.

SUNDAY DRINKING LAWS

MR. REE: Mr. Speaker, a question to the Minister of Consumer and Corporate Affairs. Recently there has been some relaxation on drinking-on-Sunday laws, allowing certain pubs and other establishments to sell drinks on Sunday. What is the position with respect to various private clubs, such as Legions? Are they permitted to also sell drinks on Sunday?

HON. MR. VEITCH: Well, the position is precisely this: all licensed establishments are allowed to remain open during the Sunday hours which have been stipulated, and that includes private clubs. The problem with the Royal Canadian Legion is that their central command has established through their constitution that they would only be open four Sundays in the year. The problem there, hon. member, is internal. They must deal with that themselves. It has nothing to do with the government. It is a constitutional matter which they will have to work out themselves if they wish to remain open on Sunday.

GORDON NEIGHBOURHOOD HOUSE

MS. BROWN: My question is to the Minister of Human Resources, and it has to do with the very successful Davie Street youth project. These are the kids whom the Prince of Wales visited when he was here, and he was so impressed with what the project was doing. They have been notified that the $43,937, which is their part of the budget which they receive from Human Resources, is going to be terminated. What is going to happen to the young people in this project during the time that the ministry is reordering the tendering and the contracting out of the project to someone else?

HON. MR. NIELSEN: Mr. Speaker, the Gordon Neighbourhood House is a contractor hired by the Ministry of Human Resources to provide services to a certain age group of youngsters who may require some assistance. The Ministry of Human Resources has a statutory obligation to assist children in need of protection. My understanding is that the agency which has been contracted has been concentrating on an age group inconsistent with the needs of the Ministry of Human Resources. It is the intent of the Ministry of Human Resources and the city of Vancouver to put the contract out to tender when it expires, and if Gordon Neighbourhood House wishes to tender on the contract, they are more than welcome to do so — to provide services for a specific age group of children in need of care or attention or services of some kind. The ministry's requirement was for a service to be provided for children between the ages of approximately 13 and 18. It is my understanding that the emphasis by this association has been on people between the ages of 18 and 24. It is my

[ Page 8131 ]

understanding that it has been acknowledged that a different target group has been serviced by that organization, and it was clearly the intent that a different group be serviced by the organization. We require services to be provided to a certain group, and we intend to contract with someone who will provide those services.

Should Gordon Neighbourhood House or others wish to emphasize service to a different age group, then they will have to contract with someone who has the responsibility for that age group. It's coming up for tender, and I think it is very healthy that any organization which contracts with the government has the opportunity of tendering for that contract, along with other associations which may feel they can offer a similar or perhaps a better service. It's nothing more than the contract running out. We're going to go to tender, and we will ask people to tender services to that age group we identify. We can't have an organization emphasizing care in an area we did not contract for.

HON. MRS. McCARTHY: I wonder if I could make an introduction.

Leave granted.

HON. MRS. McCARTHY: I'm very pleased today to welcome to the House Mr. Morgan Smith, executive director of the Department of Local Affairs in the state of Colorado. Mr. Smith is here with his wife Julie, and he is attending Expo 86 with ten business leaders. I would ask the House to give him and Mrs. Smith a very warm welcome to our province of British Columbia.

Private Members' Statements

B.C. CRUISE SHIP INDUSTRY

MR. SPEAKER: The member for Maillardville-Coquitlam. [Applause.]

MR. PARKS: What are you anticipating?

During the past week my family, along with, I'm sure, many proud British Columbians, have not only had the opportunity of attending the main Expo site, but have also been drawn to Canada Harbour Place — where, naturally enough, the Canadian pavilion is — and also the new cruise ship facilities for the port of Vancouver. As we're all well aware, the Queen of the North took Their Royal Highnesses from Nanaimo to Vancouver and docked at that beautiful brand new facility on the water.

It caused me to wonder just what the projected impact of that new facility would be on British Columbia's tourist industry. Upon doing a bit of research, l was very pleasantly surprised to learn of the fantastic impact on this province's tourism industry, thanks to the cruise ship segment of it. In the past two or three years British Columbia's cruise ship industry has blossomed into one of the most significant sectors of our provincial tourism industry. In fact, in the 1985 cruise season the port of Vancouver was an operating base for some 182 cruise ship arrivals, and more than 290,000 cruiseship passengers. These figures represent a growth of over 60 percent since the 1979 season.

Of course, we all will remember that since the 1979-80 season this province, along with the western world, has suffered a tremendous recession. Notwithstanding those difficult economic times, the cruise-ship industry, certainly in this segment of the world, has illustrated a tremendous growth. In fact, it's recognized by the industry that the B.C. Alaska cruise facilities now rank somewhere between third and fourth. In fact, last year purportedly it was the fourth most popular cruise itinerary, following the Caribbean, the Mexican coast and the Mediterranean. With the events in the Mediterranean this past year, with the disaster in the Ukraine this past couple of weeks, even the current projections of some 230 confirmed bookings into Vancouver, and apparently some 40 to 50 inquiries within the past couple of weeks, illustrates how this industry is becoming an extremely vital and important part of our provincial economy. Looking back at the 1985 figures, they paint an extremely rosy picture. Apparently the mere 300,000 cruise-ship passengers translates into literally millions of dollars of economic benefit to our province.

I know we're very concerned about the economic stimulus here in Victoria. I have just received a sheet of the confirmed arrivals in Victoria. Already they have 63 confirmed bookings, the first having arrived this week. Last year they had something like 21, I believe, an extremely marked increase in the activity in this segment. In dollar terms we're looking at apparently $1.6 million spent by 31,000 passengers here in Victoria last year. There was some $350,000 spent ashore by approximately 13,000 crew members, and three-quarters of a million dollars were paid for the port-related expenses, those indirect costs and charges that very few of us take into consideration when we look at those beautiful cruise ships as they come into the harbour.

With various other ancillary charges and miscellaneous impacts, you can extrapolate those figures for the British Columbia scene. People who have much more sophisticated research than my crystal ball tell me that something in the vicinity of $160 million went into this economy last year thanks to the cruise-ship industry. That was with a mere 182 arrivals. If you take a look at the 230 confirmed, as I say, plus the 50 or so inquiries that are facing the Victoria-Vancouver ports at this time, you're looking at somewhere between a 30 and a 50 percent increase in this one year alone. Naturally, with Expo here, not only are they going to be coming in for the two-to-four-hour stopovers, but many of these cruise ships, this year in particular, are going to make sure that they come into Vancouver, and some passengers might well take the one leg into Vancouver, spend a few days at Expo, and catch the ship as it comes back down from Alaska.

We have in Vancouver and Victoria the innate beauty, the natural splendour of our two harbours. Clearly the cruise community, which apparently is growing very rapidly....

MR. LAUK: This is a Rotarian speech.

MR. PARKS: I think the Rotarians would be very pleased to take this type of speech. Most Rotarians are very concerned about our economy; and very positive people.

MR. LAUK: ...this Thursday at the Kiwanis Club.

AN HON. MEMBER: No, it was an Optimist.

MR. PARKS: I'm sure the members of the opposition, if they try hard, can get the various sectors of the service clubs clear in their minds.

[ Page 8132 ]

MR. WILLIAMS: Maybe it was the Moose.

MR. PARKS: The Moose or the Meese, whichever royal order; they are also very positive people. Notwithstanding the attempts from various members of the opposition, something about tourism that people seem to take for granted and sort of slough of and smile about.... Tourism is probably going to be the number one industry in this province. British Columbia has the natural beauty, and all we need is positive British Columbians to offer those services, so that we can take the benefit of those services.

MR. LAUK: If your government stays in power it will be the only industry.

MR. PARKS: The hon. member makes a facetious comment about the only industry. But I wouldn't be too surprised, hon. member, that, with this government continuing in power, tourism might well become the number one industry, not only in dollar volume but of course people working, and all the important components.

Mr. Speaker, I look forward to my rebuttals.

[10:30]

[Mr. Ree in the chair.]

HON. MRS. McCARTHY: Mr. Speaker, on behalf of the Minister of Tourism (Hon. Mr. Richmond), who isn't in the House today, I would very much like to respond to the hon. member for Maillardville-Coquitlam.

The cruise ship facility which he has spoken of in Vancouver and also the one which is here in Victoria and brings so many jobs and opportunities to the island are, and in fact the whole of the business of cruise ships is, an outstanding opportunity for the economy of this province. Although the opposition members have jeered a little this morning regarding it, it is not to be taken lightly that this tourism business and the cruise ship facility business is one of the outstanding economic initiatives that the province has. It has been one which has been contributed to not only by this government but also by the government of Canada.

One has to remember that the cruise ship facility, this facility which is one of the finest in the world — I speak of the Vancouver new complex, the Canada Harbour Place complex — replaces a facility that saw our visitors arrive into what could only be described as very poor and very inadequate, almost a cattle shed. It was a very poor, rundown building. When one considers the contrast which we have now with this very beautiful facility with all of the very efficient arrangements that are made for baggage handling and for transporting people into the shops and the city of Vancouver — off the tour ship into shops, leaving dollars behind with them — I have to tell you that it is not only an achievement for the economy; it is an architectural achievement. It is an achievement which all of us in British Columbia should be very proud of.

The concept of putting together the cruise ship facility, a hotel and a trade and convention centre on the waterfront in a design which frankly rivals the Sydney opera house which it is often compared with.... As our Premier said at the official opening of the Pan Pacific Vancouver Hotel, our new Canada Harbour Place will be the facility which others will be compared to in the years to come. It is an outstanding project.

So there should be great tribute paid to the designers and the builders. It is an architectural triumph. But it is more. It is jobs for the future. It is jobs which will be interpreted throughout the years. I can say that that whole complex, tied as it is to the SkyTrain waterfront station and to a trade and convention centre and to one of the most modern hotels in the world, with connections throughout the world, is going to give to the city of Vancouver and to the province of British Columbia — to this economy— the greatest impetus in the years to come that the lower mainland will see. It is the sleeping giant of the years to come. Those people will come by the millions to spend money, and we must all congratulate our member for bringing this to the House, to our Minister of Tourism for seeing it through and to the province of British Columbia for initiating it.

MR. WILLIAMS: I just want to add a few comments to those preceding regarding tourism. There are a couple of issues that were overlooked in regard to the promotion of tourism in British Columbia. One is, in fact, a very basic issue. It is fine to have the resources and the buildings and the structures that have been discussed. There is no question in my mind that tourism has great potential in British Columbia. But yet we must ensure that we have properly trained personnel in order to service those facilities. It is okay to go out and assess your market to determine what it is and to advertise, but when you get the people here to the province, you must ensure that you have the trained personnel to adequately service there.

Presently, Mr. Speaker, only one in five workers in tourism has received any formal training. As a matter of fact, only one in three will receive any on-the-job training as it applies to the tourism industry. There is a critical need for professional development and tourism training in the face of what we consider growing international competition, because international tourism is becoming a very competitive industry. If we are going to keep up as a province with this type of industry, we need to ensure that we can develop a trained personnel to service the product.

MR. PARKS: I think the point that the Provincial Secretary made on behalf of the Minister of Tourism needs to be underscored. We have the facilities at Canada Harbour Place and also here in Victoria. But emphasizing the Vancouver experience, the cruise-ship industry has very clearly illustrated that if you don't have what they call the shore excursions, if you don't have the infrastructure to make the tourists very welcome when they arrive, and very comfortable.... It's one thing to have a good docking facility, but you must have something much more appealing than a very attracting docking facility. They have advised me that Skagway up north has perfected the art of welcoming tourism, and that is why that particular port is so effective in always increasing and maintaining their tourism industry.

We do have the infrastructure in place in Vancouver. We have a world-class port facility and world-class hotels. We have the transportation infrastructure in place to provide for efficient and speedy movement of those tourists. We have a vibrant downtown centre. What is necessary now is for the private sector — not the government, but the private sector — to accept the challenge and make sure that they provide the tours and the opportunities for tourists to have a good time, an enjoyable time, in Vancouver in that case. This particular cruise-ship year, as they refer to it, they're projecting in

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excess of $200 million being left in British Columbia by tourists from cruise ships. That's a tremendous amount of money, and considering that it was one-quarter of that five years ago, we can see the immense potential.

I'm sure with Expo we're going tot have the opportunity of making them very welcome and encouraging them to return, but the government has done all that it can do, Mr. Speaker. It's now the moment for the private sector to make sure that when people come to British Columbia, they definitely want to return to British Columbia.

BRITISH COLUMBIA FILM INDUSTRY

MR. REYNOLDS: Mr. Speaker, a world-renowned film industry has grown up over the past few years in British Columbia. Our Social Credit government has promoted our province's potential to the industry, provided information and facilitated the production of films in British Columbia. The results have been impressive. Over three years the number of films made here has tripled. The amount of film industry money spent here has increased sevenfold. The economic impact of this industry on our provincial economy has increased from $30 million to $210 million a 7110 percent increase.

Mr. Speaker, our provincial film industry boasts full employment of its 4,000 skilled technical people. As well, this growing industry creates further jobs in spinoff industries such as food catering, electrical equipment and camera rental outlets, transportation services, and accommodation. Throughout the development of the film industry our government has helped as a partner, as it does for all private sector industries. We believe that government should play a role in supporting the film industry, but government should neither control nor dictate to it. Because of the nature of the industry, it is best left to the private sector, where it can draw from the greatest number of creative and innovative people.

The film industry is at the heart of an entrepreneurial business. It is an artistic industry that must be responsive to public tastes and demands, not to the bureaucratic whim. Some of the members on the other side, however, think otherwise. In pursuit of a socialist culture, they have proposed that government run the film industry in British Columbia. Such a proposal makes neither creative nor economic sense. Film-makers want government to he a partner, not a boss. If government were to try to run the film industry, it would become paralyzed by a growing bureaucracy incapable of resisting the pressure of powerful, narrowly focused, special-interest groups that use taxpayer dollars to advance their often radical fringe views. There is not a better example of this process, Mr. Speaker, than the National Film Board of Canada.

In 1939 the federal government passed an act that established the National Film Board of Canada. The mandate of the board was to initiate and promote the production and distribution of films in the national interest, and in particular to interpret Canada to Canadians. It is debatable whether or not Canadians need Canada to be interpreted to them. The rest of the mandate, however, is not a bad idea: promoting, producing and distributing films off a national interest. The key word in this mandate is national. It indicates that these films should reach a broad spectrum of Canadians.

Initially the National Film Board did a good job of fulfilling this mandate. As time went on, however, things began to change. Although the board still made a good deal of laudable films on apolitical subjects, it now funds quite a few films whose only goal is to advance some special-interest groups positions on various political issues. The National Film Board has produced films on such broadly Canadian issues as lesbian motherhood. heroic left-wing revolutionaries and appeasement-minded peaceniks. When asked to justify this abuse of the original mandate, the National Film Board replied that in getting controversial issues before the public, explaining all sides creates ambivalence.

This point of view is surely an insult to the Canadian public. No one can he expected to make an informed decision about an issued when presented with only one side of the problem. The National Film Board's flimsy rationale for its obvious bias is nothing but a sham. It tries to give legitimacy to fringe groups that contradict basic Canadian values — values like belief in the traditional family, loyalty to allies, and faith in free enterprise. These fundamental beliefs are not always recognized by the National Film Board, and because of that the taxpayer is cheated. Yes, the taxpayer is cheated, because the National Film Board is funded with our tax dollars. The National Film Board's annual report for the fiscal year 1981-82 reports that all but $6.5 million of the board's $16 million budget came from the government of Canada — you, the taxpayer. If it weren't for parliamentary appropriations and government make-work programs, the National Film Board could not survive, and the top-heavy bureaucracy that runs the board would be forced to seek employment in the private sector. Certainly this bureaucracy could be cut back.

The federal government has made a couple of half-hearted attempts to bring this multimillion-dollar dinosaur into line. In 1982 the Applebaum-Hebert report on federal cultural policy recommended a reduction of funding for the film board, a restructuring of its organization and a revision of its mandate. In December 1985 the Neilsen task force echoed these recommendations, calling for a $20 million reduction over four years in the board's budget and a shift in the mandate toward an emphasis on training and experimental film. It is doubtful, however, that the leftist special interest groups will allow funding for their sacred cow to be reduced or its mandate to be changed. It's the old story of having a decent idea, creating a bureaucracy to carry out that idea, and having the bureaucracy go out of control and fall prey to well-orchestrated special-interest pressures, and in doing so fail to uphold its mandate of serving all the people.

The members on the other side no doubt think that the National Film Board is the best thing to happen in Canadian film-making. They probably think that some similar publicly financed organization is just what British Columbia needs. Careful examination of this real situation, however, proves how foolhardy and fiscally irresponsible this belief is.

The film industry in British Columbia will thrive as long as private industry is given the freedom to work in a climate of economic opportunity fostered by a responsible, realistic and businesslike government. The industry needs government to act in partnership with it, not dominate it. The tremendous recent successes of the British Columbia film industry are proof that our government approach to the film industry is best for that industry and for all British Columbians, and the government of Canada should look at this same aspect when dealing with the National Film Board of Canada.

MR. WILLIAMS: It's intriguing getting the ideological dance at the end there with respect to the National Film

[ Page 8134 ]

Board. Anybody that's reviewed these questions for some time would know that the film board has probably received more awards in the film industry than almost any similar agency in the world, and certainly some of the creative work they've done has been extraordinary and successful. But I don't want to spend too much time on that ideological nonsense that was presented.

Indeed the film Industry is important, and indeed it should be a partnership. There's no question about that. But the reality is that there is a need for facilities in British Columbia. The Panorama Studios in West Vancouver will come down shortly for real estate development. It's true there are needs for replacement, and some kind of creative, cooperative approach with the industry is definitely needed. There is no question about that.

[10:45]

I couldn't agree more with the member that a single government approach would not be the correct approach, and that is the position of this party: that it should be cooperative, and where help from government can be provided it should be provided. But presently provincial action is divided among three agencies: Communications, the Ministry of Tourism and the Provincial Secretary. So there isn't any real coordination on the government's side. There's no question the film promotion group, a small bureaucracy, has done extremely well, and we commend those officials who have done as well as they have to bring B.C. to the third level of film production, in terms of cities in North America. That's quite some achievement. But the next steps are equally critical.

What hasn't been done is working with the federal government. We get only 6 percent of the money of Telefilm Canada in British Columbia, in terms of getting Canadian production in British Columbia. And that's where you've fallen down significantly. In addition, there's a tremendous need for training developing the staff and talents of more British Columbians to work in this industry as it grows and continues to succeed.

It's not an ideological question at all. It's a matter of how we can take the next steps to further this industry. We have to take the next steps soon, because real estate developers will be knocking down the one studio that we have in West Vancouver.

HON. MRS. McCARTHY: I just want to speak regarding the remarks that have just been made by both members of this House. First of all, may I correct the member who has just taken his place, because the Provincial Secretary does not address the film industry in this province. I speak as the minister responsible for Tourism in the House when our Minister of Tourism is away.

I wanted to say that we should give credit to one person who came to me when I was the Minister of Tourism and said that there was a very great need for someone who would implement the ease in Which films could be made — closing of streets, that sort of thing. That was all that was needed to be done to really start the film industry in this province. That man was the late Jack Wasserman. If it had not been for Jack's off-the-cuff comment to me, we would not have done that. As you know, we did, and that was in 1976. That industry that was almost zero at that time has grown to this multimillion dollar job-creation industry today.

I want to pay tribute to Justice Green, who was one of our early directors: no longer there, replaced by a terrific young lady, Diane Neufeld. Out of that tiny office with just about three people, all of this money flows into the province of British Columbia and most of if is offshore money and investment, as you know.

As for the comments of the member for Vancouver East vis-a-vis training, you don't have to worry about the training of the people in the film industry in this province. We are known worldwide, and the reason that the industry attracts films in this province so much and has grown to be such a great industry is that the people in the industry are the best. That is even comparable to the state of California, which has done a great job in the film industry over the years.

I wanted to make that point because it's a great tribute to them that they do what the free enterprise system was intended to do. They do their job well. They produce, they create jobs and all of us benefit, and that's what the free enterprise system is all about. Let it work. It's working with them; don't try to change it. It ain't broke; don't change it. They're doing a really great job.

They need a space to flourish. Let's let the private sector be involved, let them invest, and let us get on with it, with the government giving its support and its backup, as it has done in a most meaningful way through our ministries of trade, industry and the Ministry of Tourism.

MR. REYNOLDS: Mr. Speaker, I want to say how pleased I was at one comment the second member for Vancouver East (Mr. Williams) made when he said he agrees with a partnership in the film industry. It's nice to see members of that side starting to agree with partnerships. It takes a lot of talk, Mr. Speaker, to make them realize that it's partnerships that make things work. It is this partnership that this government's been promoting that's making this province such a great place to live in.

Interjections.

MR. REYNOLDS: Mr. Speaker, it's hard to get going with the member from Burnaby down there yapping away. The second member for Vancouver East talked about three ministries being involved in the film industry in this province. He's not too often wrong; he said three but it's four. I think he forgot about the Minister of Industry and Small Business (Hon. R. McClelland) who is dealing on a movie studio in this province with the people in the industry right now.

I know it's never nice to see a building taken down, and I know that the Panorama Studios in West Vancouver is probably going to come down for some real estate development, but it's because it's proved unsuccessful. The film industry itself was not excited about that studio, but they are about another one in the downtown area of Vancouver, in the lower mainland. I can't really knock that. Maybe it's going to be in Surrey. It'll be somewhere in the lower mainland, but it certainly doesn't seem that West Vancouver was a very successful place for that type of studio. I can't really knock the developers in trying to recoup some of their money by getting that building torn down and redeveloping it.

Mr. Speaker, the film industry is employing a lot of people in this province. I wanted to stress today that we keep it the way it is. I don't see a position for the government of British Columbia for getting into the film industry in British Columbia. We have the proper training facilities to train people. As far as acting with live theatre goes, we've got lots of it in Victoria, and even some actors right in this House.

[ Page 8135 ]

Mr. Speaker, the training facilities for actors and actresses, the technicians, are just tremendous in British Columbia, and that's why we've had a sevenfold increase in the last three years in the film industry in British Columbia. That's the best news we can have, and with Expo and the exposure we're going to get to the rest of the world, I hope we'll see that industry keep on growing the way it has been growing over the last three years.

UBC ENTRY LIMITATIONS FOR
MALASPINA COLLEGE STUDENTS

MR. STUPICH: Mr. Speaker, I do appreciate the attendance this morning of the Minister of Post-Secondary Education (Hon. R. Fraser). I speak for the disadvantaged, and that could be almost anybody in the community; but in this particular instance, I'm talking about the students who are attending — and will be attending — Malaspina College in particular; the college system in general, but I'd like to direct my remarks towards Malaspina College.

My particular concern is with respect to a decision made by the UBC senate on Wednesday, April 23, 1986 to restrict enrolment of first- and second-year students to 750. The college system has, I believe, served the people of the Nanaimo district — the Nanaimo Malaspina College district at least, which of course goes very much beyond Nanaimo very well for the almost 20 years it has been in existence. Some thousands of students have taken advantage of the opportunity to attend Malaspina College for their first two years and then to go on to the university of their choice, whether one of the three universities in B.C. or a university elsewhere. I believe they've done very well, in comparison to the students who have gone directly to university.

When the college system was first proposed in the Macdonald commission report of 1962, it was with a view to making it possible for students in rural areas all over British Columbia to be able to get at least the first two years of university training for relatively the same cost as those students who live at or near one of the universities in the province. Cost is a very important factor. It also made it possible for them to make an easier break from the home environment in which they had been living. Moving away from the community totally to get their education — a very sharp break between home and attending university. It made it easier that way. Some of them did commute to Malaspina College from regions apart from Nanaimo. Some of them actually lived in Nanaimo, but much more economically than they could have lived in the city of Vancouver, or even in Victoria.

I believe that the academic contribution made by Malaspina College has been very important to the college in total. It's one of the reasons Malaspina College has been successful in developing its program of adult part-time learners, the vocational program, which was there before but which has certainly improved since. Beyond that, there is the social, entertainment and cultural contribution that Malaspina College has made to our community.

My concern is not so much that the number of 750 which they have said they will accept at UBC is limiting — there are other universities  — but who is going to be one of the 750 and who is going to be left out? Seven hundred and fifty may even be enough, but a student considering going to Malaspina College cannot do so any longer with a certain knowledge that if the other requirements for admission to UBC are met, then that student will be admitted. Now this cloud is hanging over it, that the student may be over the limit. Beyond that is the concern that other universities may follow suit. If UBC does it, then what happens to Simon Fraser, to UVic? Will they be next?

There's the concern that today the figure is 750; if they get away with it, if the government allows this to happen, then next year the figure may be different. It may be less; it may be more. There is the uncertainty. Students will no longer be able to plan their educational life knowing they can get their first two years of education at Malaspina College — of course, the same thing applies clear across the province — and that they will be able to get admission to the university of their choice, assuming, as I say, they meet the other requirements.

My real concern is what it's going to do to the whole concept of regional colleges, how damaging it will be. Certainly the academic aspect of the college is important to the college in total, and the ability of the colleges to continue to maintain the kind of presence they have had to this point in the various districts may very well be impaired. It costs a great deal to attend university. I know from experience. It makes it easier if students can spend their first two years attending college in their home community or near their home community. But it is important, when they do that, that they know they're not wasting those two years in the event that they do want to go on to UBC. My concern is, as I said, will other universities adopt the same tactic? Will other universities change the numbers? What certainty can the minister give?

When the college system was first introduced in British Columbia, one of the universities stated that they were not going to accept transfers from regional colleges, in particular Malaspina College. The Minister of Education of the day, the Hon. Donald Brothers — speaking, I'm sure, for the government — said: "That's fine. Don't accept them. But the government will cut the grants to the university." The university saw the light of day; they suddenly realized that it was going to be possible for them to accept transfers from regional colleges, including Malaspina.

[11:00]

I would urge the Minister of Post-Secondary Education (Hon. R. Fraser) to take a leaf from the book of the previous Social Credit administration on behalf of the disadvantaged, the students who don't live next door to UBC or to UVic or to Simon Fraser, the ones for whom it would be a very heavy drain, and perhaps make post-secondary training at a university impossible for some of them. I urge the minister to take a leaf from the book of the previous Social Credit administration and react in the same way that the Minister of Education did in those days, and pass on to UBC — and as a warning to the other universities — a message that they will clearly understand.

HON. R. FRASER: Mr. Speaker, l thank the member for advising me beforehand what his topic was going to be, because from the title I was unable to determine exactly what it was. I appreciate him giving me the chance to take note of his presentation.

With respect to the comment by the professor at the senate of UBC who said that universities would not be finishing schools for colleges. I think we would all take offence to that, to the extent that if we would let it go by, because obviously it can't mean that much.... He can't be serious about that,

[ Page 8136 ]

because the whole college network was built so that students who do not live on the lower mainland will have a chance for a post-secondary education suited to their needs.

We would all agree on that. Certainly with respect to Malaspina there is no doubt about the fact that that's a good college. Among other things, I had the opportunity to visit that college in the member's riding, and I am as impressed as he is with the contribution that the college is making to that community. And in fact I am impressed with the great bond the college has with the community, and the community has with the college. They are doing things there that I certainly would endorse, and I have no doubt that the member does as well.

[Mrs. Johnston in the chair.]

The other things about cultural involvement and cultural development, training of overseas students — all those things are important in our college network, and we all support them and always will. With respect to the serious matter of not accepting students, or the suggestion that enrolment will be reduced from colleges, the member can take comfort, I hope, from the fact that I have spoken to the president of the University of British Columbia expressing the point of view that I wasn't happy to hear of arbitrary limits on enrolments in that way. So I do not want to give the students who do not go to university the idea that they cannot transfer.

The intention of the universities, as I understand it, hon. member, is that everyone will have to be competing for seats in third and fourth year, including students who are already at the university. They are trying to produce as balanced a program as they possibly can. So you can be certain that this minister, this ministry and this government will he watching very carefully to make sure that the students who live outside of the lower mainland who are attending our regional colleges and who are working hard to get an education can get one, and that those students who qualify to go to educational levels beyond the college diploma can get them.

MR. STUPICH: I do appreciate the fact that the minister attended, but I am disappointed in the assurance he has given us. It isn't enough. Madam Speaker, if I were a student contemplating attending Malaspina College with a view to transferring to UBC, the fact that the minister has spoken to the president and said that he is not very happy with this decision, and that he hopes something will be done, still leaves us with a decision of the UBC senate where they have quite clearly said, at least in the quotation I have, that they will for the first time limit to 750 the number of second and third-year students entering the program from outside the university.

Now it may well be that they want to measure students and limit the enrolment in total, but this decision is very specific with respect to from whence those students will come. They're not saying they're going to limit the number that are coming into university for first and second year; they're saying they are going to limit the number coming from outside of the university.

Madam Speaker, we're still faced with that. The minister has not given any real assurance to students who are contemplating entering Malaspina College in September of this year that even if they do exceptionally well, there is still no guarantee that the University of British Columbia will accept them on an equal basis with students who are entering UBC for their first year. Now that's all they want. They want to be able to compete with students who are entering UBC for the first and second years. They want to be able to compete on an even keel with students who are entering Malaspina College and all the rest of the colleges in the province of British Columbia.

Now the minister may have had a conversation with the president. Well, he has; he said he had. But again, the Minister of Education in the previous Social Credit administration didn't just have a confidential conversation. The minister said very clearly then that the universities were going to be obliged to accept students from the colleges on the same basis as they were accepting third-year students from within their own university. Now that's what we want.

The minister hasn't to this point given those students that assurance. What is he going to say to a student considering entering Malaspina College in September, when that student asks the minister: "Can you guarantee me that I will get the same treatment as my brother or my sister who is going to UBC for their first year?" To this point the minister hasn't done that. The minister has fallen short of reassuring students entering the college program that they will have the same access. That's what we want; that's what we need, if the college system is to survive in the province, if it is to do the job for the people of British Columbia that they were started up to do in the first place.

ROYAL VISITS

MR. MACDONALD: Madam Speaker, the subject of my statement is royal visits. I can't remember, except through dim recollection, the first that I can think about in British Columbia, but I think Mayor Lyle Telford was presiding in the city of Vancouver. There was a little bit of a contretemps at that time. l remember very clearly visits of the Queen and her consort in 1983, and a previous visit of Prince Charles, where I met him in the aquarium.

We in the province of British Columbia welcome these visits, Madam Speaker. There is obviously a real electricity between the crowds of friendly British Columbians and the friendly Prince Charles and Diana, Princess of Wales. You can ,just see that electricity. It's a good thing, it's good for democracy, and we want them to come again. I would think that Prince Charles wants to come again. He described very properly, I think, the people of British Columbia, on one occasion, as a warm-hearted people. We wish them well.

But I would have to say that a discordant note has been creeping into the question of royal visits. Increasingly and unfortunately, governments, federal and provincial, are injecting their own partisan political interests into the procedures of the royal tours. This is a discourtesy to our royal visitors. I would say, Madam Speaker, without fear of contradiction, that we must not allow our royal visitors to be used for anyone's, or any party's, political purposes. [Applause.] All members of the House agree with that, and I'm very pleased to see it. But it has happened, and did happen, very extensively and very obviously, in the last visit of Charles and Diana.

That's very unfortunate, because Buckingham Palace makes great efforts to keep itself above or, at any rate, separate from the political partisan process. That's very necessary. For example, the royal visitors would not be in British Columbia either closely before or closely after the call of a provincial election. The reason for that is simply that it is

[ Page 8137 ]

terribly important to keep that separation between Crown and politics. We — meaning we British Columbians, through our government — ought to respect that separation of Crown and politics better than we have done.

I give three examples of where politics crept into, perhaps infested, the recent royal visit. The mayor of Vancouver happens to belong to a particular political party, which is my own, but he also represents all of the people of the province of British Columbia. He was cut out of all of the early welcoming ceremonies for the Prince and Princess. He wasn't even on the floor in B.C. Place, where I was able....

SOME HON. MEMBERS: Yes, he was.

MR. MACDONALD: No, no. He was down in the roped area of B.C. Place with me. I didn't see him there. He was there? Well, good. Then all the reports are wrong, and this government didn't display partisan bias.

Did they display partisan bias, Madam Speaker, when the 4,100 invitations to attend B.C. Place were sent by the Provincial Secretary (Hon. Mrs. McCarthy) to whom? The headquarters of the Progressive Conservative Party, with which the Socred Party has always had an underground alliance. That looks like politics and smells like politics, but nobody should be deceived: it was politics.

I didn't see the mayor there in B.C. Place. If he was allowed into that much, if he was given that much recognition, good. But he was slighted in those early ceremonies in terms of welcoming the Prince and Princess to Vancouver. That was a slight to the Crown and a slight to the people of the city of Vancouver.

I don't want to make an excitable speech on a subject of this gravity, and my time races on, but my third example is that, you know, it's really a little much when in a joint-list situation with provincial and federal government — primarily federal, I know that — you have a state dinner, and the Governor-General of Canada is not invited, and the Lieutenant-Governor of British Columbia is invited after Marjorie Nichols writes a column — a latecomer — and all kinds of other people are invited to the state dinner. I wasn't, but chequebook Socreds were invited automatically.

SOME HON. MEMBERS: Oh, oh.

MR. MACDONALD: There's nothing wrong with being a chequebook Socred, is there? But why should Her Majesty's representative in the province of British Columbia be a latecomer to a state dinner to honour the Prince and Princess? That is ridiculous.

I close on a positive note...

MR. REID: That'll be nice.

MR. MACDONALD: That'll be nice.

... by simply saying, because we look to the future — and it is a serious point — let's not allow royal visits to be used by anyone for political purposes. And when royalty visits this province in future, and there is a state dinner with 900 people or something, let it be under the auspices of Her Majesty's representatives in this province and in Canada, the Governor-General of Canada and the Lieutenant-Governor of British Columbia, so that no one will be able to say: "That list, those tables, that arrangement was political."

HON. MRS. McCARTHY: I want to respond to the member who has just taken his seat, and to say in the strongest personal terms I can possibly muster that he has brought a discordant note to this House today which is a very sad reflection on the enthusiasm and the warmth and the hospitality that was expressed by all British Columbians toward the royal couple as they officially opened Expo 86 last week.

[11:15]

Let me tell you that the royal tour was a very complex one. It is the longest in any Canadian province in our history. It was 45 separate events with nine communities with 1,000 volunteers, 1,600 RCMP, 800 media representatives and 100 staff. It took six months to plan. It was not just a simple tour to do. There was a simple term of protocol used. It was consistent and it was with the approval all through, minute-by-minute, of the royal palace. And it was. When there was an event in a community, a mayor of a city would not greet Their Highnesses on their arrival. This was followed in community after community. Where there was not an event in a community, the mayor greeted the royal couple. This was followed, for example, in the city of Victoria. Mayor Gretchen Brewin received and met them because there was no other event in the community. In Saanich and in other communities the mayor of Richmond and the mayor of Saanich met the royal couple and welcomed them. However, where there was an event — and there were many in the city of Vancouver — the mayor was not on the welcoming party in that regard because he had his opportunity on many an occasion. That's number one.

We did not have any control as the province of British Columbia over the events and invitations except those related directly to the government of Canada. That is, the welcome and goodbye to Canada ceremonies, the arrival ceremony at Canada Place, the government of Canada dinner and luncheon and the opening of the Canada Pavilion were all federal government events. I was not consulted about the invitation list for any of the dinners and luncheons that were under the jurisdiction of the federal government, and we did not host any luncheons or dinners. Neither I nor any of the provincial staff were part of the decision of the government of Canada as to who should be at the arrival at Canada Place. As far as state dinners are concerned, I did not attend the state dinner, nor would I have expected to. If I had had an invitation, it would have been very nice. As I didn't, I'm not crying crocodile tears because I wasn't invited. There are many members of the cabinet who were invited to some things and not invited to others.

We don't have mayors of other communities coming to us and crying because they were not invited and are very hurt. I find this is an absolutely astounding comment from the member for Vancouver East. The mayor's office didn't in any way reach my office in advance — if he was hurt. If his hurt was that long-standing and that deep, it's interesting that he didn't reach our office. He could have reached our staff any time, and he would be able to be informed that it was the federal government's organization that did the invitation list — if he wished to be invited.

The only discordant note — and the member for Vancouver East says it's a discordant note — is that the socialists and the leftists view this as an opportunity for a headline. The mayor of Vancouver is exploiting discord. The member for Vancouver East and other members of the NDP are exploiting discord.

[ Page 8138 ]

[Mr. Speaker in the chair.]

In view of the long-standing support that the mayor of Vancouver has had for Expo, that he should even expect an invitation to Expo is really in itself a remarkable statement. We know that he received an invitation to Expo. We also know that he received an invitation to the royal box and did not use his tickets at the Orpheum Theatre last Friday night. When two people could have used those tickets, they did not.

Mr. Speaker, the imagined slights and feigned hurt because of the lack of invitations is quite frankly, I think, the attitude of a snivelling party and mayor who are crying crocodile tears to exploit something that was very positive and very good.

MR. MACDONALD: Mr. Speaker, I have a brief reply. I wasn't invited to the state dinner, but I'm not snivelling about it. I was a little worried whether if I dined with a prince, I could keep my common touch — I wasn't sure of that at all. So I'm not snivelling about it.

But you know, Mr. Speaker, the political bias of the Provincial Secretary shone through that speech when she finally began to say, "Oh, it was just the mayor," and so forth. It was all the feds' fault; there was no consultation about the lists with the federal government, with our Progressive Conservative.... Nobody believes that any more than they believe that Sinclair Stevens got a $2.6 million loan for his company and didn't know anything about it. You don't believe that. We don't believe that. There are politics involved in the royal tour that shouldn't have been. We're talking about the future, and we're just simply saying that this kind of injection of partisan politics into the royal tour should not continue, because it is a slight to the royal visitors and it is a slight to the people of the province and of Canada.

MR. LAUK: You know, people in the city of Vancouver of all political stripes....

HON. MR. NIELSEN: On a point of order, Mr. Speaker, only the person who raised the statement has the opportunity of replying....

Interjections.

MR. SPEAKER: Order, please. Hon. members, standing order 25 indicates that the proponent has a maximum of seven minutes; any other member or members, a maximum of five minutes; and the proponent in reply, a maximum of three minutes; for a total of 15 — which is all that's allowed. Now this point has not arisen before, but it would seem only reasonable to assume that when the proponent has had an opportunity to conclude, that would be akin to the mover of a motion concluding debate. Otherwise, hon. member, the proponent does not have the last word, and this is really what, basically, it's all about. Therefore, hon. member, with the greatest respect to the learned member for Vancouver Centre, the Chair will decline to hear the member and will allow the member for Vancouver East to have the final word, as is his right under this particular section.

HON. MR. NIELSEN: Committee on Bill 20, Mr. Speaker.

INTERNATIONAL COMMERCIAL ARBITRATION
ACT

The House in committee on Bill 20; Mr. Ree in the chair.

MR. CHAIRMAN: Shall section 1 pass?

Interjections.

MR. CHAIRMAN: So ordered.

Shall section 2 pass?

Interjections.

MR. CHAIRMAN: So ordered.

The Attorney-General — on section 2?

HON. MR. SMITH: Mr. Chairman, I move the amendment standing under my name on the order paper. [_{See appendix.}]

Amendment approved.

MR. CHAIRMAN: Shall section 2 as amended pass?

SOME HON. MEMBERS: Section 1 as amended.

MR. NICHOLSON: We've already passed section 1, so I don't want a precedent set. I'd like to have the Chair or the minister ask leave to....

HON. MR. SMITH: I ask leave, I guess, to rescind the vote on section 1 and then have a vote on section 1 as amended.

Leave granted.

Amendment approved.

Section 1 as amended approved.

Sections 2 to 6 inclusive approved.

On section 7.

MR. LAUK: Mr. Chairman, are there any other amendments on the order paper with respect to this bill?

MR. CHAIRMAN: No, there are not, hon. member.

MR. LAUK: May I suggest we take them in bulk form.

Sections 7 to 42 inclusive approved.

Preamble approved.

Title approved.

HON. MR. SMITH: Mr. Chairman, I move that the committee rise and report the bill complete with amendment.

Motion approved.

The House resumed; Mr. Speaker in the chair.

[ Page 8139 ]

Bill 20, International Commercial Arbitration Act, reported complete with amendment.

MR. SPEAKER: When shall the bill be read a third time?

HON. MR. SMITH: With leave of the House now, Mr. Speaker.

Leave granted.

Bill 20, International Commercial Arbitration Act, read a third time and passed.

HON. MR. McCLELLAND: Committee on Bill 22, Mr. Speaker.

[11:30]

COMMERCIAL ARBITRATION ACT

The House in committee on Bill 22, Mr. Ree in the chair. Sections 1 to 26 inclusive approved.

On section 27.

HON. MR. SMITH: Mr. Chairman, I move the amendment standing in my name on the order paper. [ See appendix. ] Amendment approved.

Section 27 as amended approved. Sections 28 to 51 inclusive approved. On new section 51.1.

HON. MR. SMITH: I move the amendment standing in my name on the order paper adding section 51.1.

On the amendment.

MR. LAUK: Just a brief question. It strikes me that the Arbitration Act is mentioned in a number of other statutes that may not be referenced here, including.... If I can just refer back for the answer to this question, could the minister report what is going to happen in substitution for section 99(4) of the Labour Code, for example, which it seems to me may have been a useful section?

HON. MR. SMITH: Mr. Chairman, all the affected acts are referenced in the schedule to the bill, and there is absolutely no alteration in any way to any proceeding under the Labour Code. There may be a change in the reference from old Arbitration Act to new one, but I can assure the member that labour arbitration proceedings will be governed by the Labour Code.

Amendment approved. Section 51.1 approved. Sections 52 to 54 inclusive approved. On the schedule.

HON. MR. SMITH: I move the amendment standing in my name on the order paper. [See appendix.]

Amendment approved. Schedule as amended approved. Preamble approved.

Title approved.

HON. MR. SMITH: I move the committee rise and report the bill complete with amendments.

Motion approved.

The House resumed, Mr. Speaker in the chair.

Bill 22, Commercial Arbitration Act, reported complete with amendments.

MR. SPEAKER: When shall the bill be read a third time?

HON. MR. SMITH: With leave now, Mr. Speaker.

Leave granted.

Bill 22, Commercial Arbitration Act, read a third time and passed.

HON. MR. NIELSEN: I call Committee of Supply, Mr. Speaker.

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

ESTIMATES: MINISTRY OF ENERGY, MINES AND
PETROLEUM RESOURCES

(continued)

On vote 20: minister's office, $197,228.

MR. LOCKSTEAD: Yesterday I discussed with the minister the problems and the high unemployment rate in the mining industry, and the number of mines that have shut down — some new ones opening, I hope, eventually. But today I want to follow up that part of the debate with some possible solutions and comments from the minister on solutions to some of these problems.

I don't really know how deeply the provincial government has been involved. There have been, in my view, several passed-up federal initiatives in regard to this province's relationship with the federal government. I will very briefly go through a few of these. Presumably the minister will respond if some of these matters I'm mentioning are incorrect. But our research, I think, was quite thorough in this matter.

There have been federal initiatives to help deal with these kinds of problems, which B.C. has refused to participate in. Returning to the problems of the single-industry mining communities, and the need to plan ahead, in 1982 there was a meeting of provincial mines ministers. At that meeting the Manitoba minister, Mr. Parasiuk, called for the establishment of a national mining community reserve fund to assist mining communities facing layoffs and shutdowns. His suggestion

[ Page 8140 ]

was based on the successful Manitoba model of a mining reserve fund in operation since 1970. In Manitoba some 3 percent of provincial mining taxes go into the fund, and the money is used to assist when mining downturns occur: for example, through job creation projects, developing alternative economic activities, or relocating people if there's a total closure in a single-industry community.

[Mrs. Johnston in the chair.]

At the 1982 meeting Mr. Parasiuk called on the federal government and the provinces to set up a national version of this policy. I was astounded to find out, Madam Chairman, that B.C. was not interested. I'm not blaming this minister specifically. I'm just getting off the topic here, because the minister has only been in office two or three months in his present capacity. However, there is some reflection on this statement about the present government of British Columbia.

At the 1984 meeting of federal and provincial mines ministers, the Manitoba minister successfully convinced the federal government to do a study of single-industry towns. At the May 1985 meeting the federal government and the Manitoba ministry of mines agreed to do a joint study of financing mechanisms to deal with mining community problems. That report is now available and worth reading for all concerned, with ways to promote stability in mining communities. One of the options this report suggested was to design a mining community reserve fund where the province would set aside a specific portion of their mineral-tax revenues with matching federal funds and contributions from the municipalities as well. This money could then be used to pay for temporary or permanent mine closures. There is currently a study underway to investigate this policy. The following groups are participating in this study: the federal government, the Mining Association of Canada, the Association of Threatened Single-Industry Towns, the provincial governments of Newfoundland, New Brunswick, Saskatchewan, Ontario, Manitoba, Northwest Territories and Yukon, and the United Steelworkers, but not British Columbia. Perhaps the minister, when he responds, could tell us why British Columbia is not taking part in this extremely important study.

B.C. under this government is one of the few Canadian provinces that refuse to participate in this effort to help deal with problems of single-industry towns. We run the risk of not receiving federal money which could be part of this initiative. Why is B.C. not participating? We can only conclude that the government is not interested in planning ahead to avoid and alleviate disruption, unemployment, income loss and personal suffering associated with mine closures.

Examination of B.C. communities dependent on mining shows places where companies are predicting the final year of production based on 1984 reserves. We need to plan now to avoid problems when the inevitable happens in these places. Cassiar: their last year of production is scheduled to be 1989, not too many years away — three years away. Houston: 1991 is projected to be the last year of production. Kimberley: their population of 7,300 will be affected in 2003, when the ore is due to run out. Logan Lake, Merritt and Kamloops: they're already suffering from closures of the Highmont Mine in the fall of '85. Lornex Mine, nearby, sees 1997 as the last year of production. Port Hardy: it has a population in excess of 5,000, and 1991 is the last year of production for Island Copper. We can't afford to let these towns become ghost towns. We need action by the B.C. government to participate in federal-provincial initiatives and establish financial mechanisms to prepare now for future dislocations.

One other quick item. I may not be here for the minister's response, but I will read the minister's response in Hansard on Monday. On an entirely separate question, and very briefly, last year the B.C. government signed the ERD agreement with the federal government, which included a mineral subagreement for $10 million shared fifty-fifty with the federal government. You're familiar with the $10 million federal-provincial agreement signed last year under ERDA. This was the lowest sum received by any province in Canada. Manitoba received $25 million. Saskatchewan, $12 million; New Brunswick, $22 million — little New Brunswick, $22 million! — Nova Scotia, $27 million; Newfoundland, $22 million; Ontario, $30 million; and Quebec, $100 million. According to the federal Minister of State for Mines, Robert Layton, there was additional money available for mining under the science and technology portion of the ERD agreement which the B.C. government did not even apply for. I would like to know, and I'm sure the mining industry of British Columbia would like to know, why B.C. received only $l0 million under that agreement, when most of the other provinces received far in excess of that amount of money, particularly when mining is such a major industry here in British Columbia and is in a fairly sad position.

Mr. Minister, I will look forward to reading your responses, because I really have to hit the road, or I'm going to miss my....

HON. MR. BRUMMET: I thank the member for his questions, Madam Chairman. He mentions the national fund. I'm delighted that he said that what it involved was a 3 percent additional tax to the mining industry in order to make it happen — and municipal taxes and other taxes that needed to be added. In trying to keep the mining industry alive, I guess, in these times when world metal prices are down and they're struggling to survive for cashflow, I guess we've taken the opposite approach. We have tried to reduce their taxes, as was done in the provincial budget. We've tried to allow them to stay alive, rather than get 3 percent of their money to study something that may not be prevented. When the ore runs out, you cannot keep the mine open, no matter how many studies you have.

Yes, I'm not that familiar with what went on prior to my getting into the ministry, but I can say that I would support that: we don't need additional taxation to the mining industry. What we need is to allow them lower taxes, to try to find some way to allow them to work in those conditions to keep the mines open. We are very interested in keeping these towns going, and I think we're taking the proper approach to it. We've just put up $5 million to try to add to ore bodies, to try to encourage exploration, encourage prospecting, and to encourage the expansion of existing ore bodies. That is what will keep towns open, not studies. We like to get the best value for money, and the best value in the long run is to get more mines operating, to get mines expanding their operations.

Therein lies the answer. We're very concerned about the jobs that that creates, and I think that is the way that it will create jobs, as has been done in the various operations in the province so far. There are thousands of jobs that have been created because of these policies.

As far as the member saying that we can't afford ghost towns, that's perfectly correct, but the way to avoid ghost

[ Page 8141 ]

towns is to encourage exploration, to encourage mine development, to encourage other mines or other ore bodies to be found, even if one is running out, or certainly to encourage expansion of the existing ones. So that is, I guess, the general approach. We can't afford ghost towns, and the way not to have ghost towns is to encourage the mining industry to operate, not discourage them with further taxation and studies. When you're done with them you often have a very definitive description of why the town is going down, why the ore body ran out and that sort of thing, but that does not keep the town alive.

[11:45]

So we'd rather encourage the mining industry. We've taken various steps. There was the northwest development plan. There are a number of things that have happened here, in encouragement with the government helping to provide the infrastructure, to try to assist those industries — not take them over but to assist them.

As far as the ERD agreement was concerned, we did get the $10 million which was earmarked for the mining area. I don't know where the member does his research, but certainly there was no indication that there was more money available that we did not tap into. I know that our Minister of Industry and Small Business Development (Hon. Mr. McClelland), did a yeoman job of negotiating as much as we did get in that five-year agreement. That money that we've got the $10 million — is going into exactly what I've been talking about, and that is it's going into geological surveys which will give the people a better idea of where to get the best value by looking for new mining ore bodies. It is helping to study roads and various infrastructure along with the company. It's a sharing arrangement with those various companies to make it much more possible for them to get to the development stage as quickly as possible, with proper environmental concerns looked after. So I don't know that studying it to death and charging the industry another 3 or 5 percent and charging every taxpayer in they province more money is the answer. I think the answer is to stimulate the mining industry, and that's exactly what our approach is.

MS. SANFORD: Madam Chairman, I raised the other day with the Minister of Environment (Hon. Mr. Pelton) an issue which is of great concern in my constituency related to the old Mount Washington mine that has closed down and is causing horrendous problems as far as the fisheries are concerned in the Tsolum River. A river that once had over 3,000 pink salmon now has no fish whatsoever. There is a study that has been underway between the Ministry of Mines, the Ministry of Energy and some federal people as well — the federal Fisheries — and that study is about completed now, but it's obvious that a massive amount of work has to be done if we're going to restore the fishery in the Tsolum at all. The longer it's delayed, the more difficult it is going to be to restore that fishery.

Recently in an article in the Comox District Free Press, the reporters for the area contacted a senior official for the Energy, Mines and Petroleum Resources ministry and was informed: "Yes, it's a major problem, but we're sorry, we have no money to deal with it." Now it seems to me, Madam Chairman, to the minister, that it's essential that the government come up with some money to begin to correct the problems that exist with this Mount Washington mess, as the Minister of Environment called it the other day. l don't know if this minister is aware of the problem, but I'm appealing to him today, even though the senior mines official says they have no money to carry out work in this year's budget, that either some special warrants be issued or some action be taken through the Ministry of Energy, Mines and Petroleum Resources to see that the reclamation work is begun and begun immediately. I wonder if the minister has any comments on this. My guess is that he's not familiar with the situation.

HON. MR. BRUMMET: The member is quite right. I'm not familiar with that particular situation, but I will look into it. It's hard to comment when you don't know the specifics of it, and if the member would like to provide me with more particulars or write me a letter on it, I'd certainly investigate it further and do what I can.

MRS. WALLACE: Madam Chairman, I want to deal with one of the other responsibilities of this ministry, and that is energy. I noted that he said in replying to my colleague from Mackenzie that he believed in getting the most for his money when he was spending it on mining, and I am wondering whether that same policy applies to energy. I would like to refer him to something that he has inherited in the form of the Columbia River Treaty.

This was signed in 1961, and under that treaty three dams were built in B.C. and one in the U.S. The former Bennett government sold B.C.'s right to the increased electricity generated from those dams for the first 30 years. Now that treaty is up for renegotiation; it actually expires in 1991. That 30 years is up. The province of B.C. received only $479 million for that energy, and the actual cost to British Columbia was almost $1.3 billion — $1.273 billion — to build those dams.

Certainly we didn't get the best for our money on that Columbia treaty deal. You know, it cost us almost $800 million, plus a lot of land — 185,000 acres of flooded land and a thousand jobs lost in the forest industry as a result of that; many, many losses. Now I'm wondering where the Columbia River power fits in this ministry's future energy plans. In 1991 we're going to have some options. We're going to have an option to use that power in British Columbia, or we're going to have an option to resell it.

I'm wondering whether the minister can tell the House whether he has in his long-term energy plan, if he has one, how he is planning on utilizing that power output from the Columbia River subsequent to 1991 — where that fits in his overall energy plan.

HON. MR. BRUMMET: Well, I don't know. This issue of the Columbia River Treaty keeps coming back repeatedly. You know, the amount of money in today's terms may not be that much. In those days, it was a substantial amount of money, and it allowed the development of an electricity generating program in the province. It has assisted that, but in all the debate I've heard the province came out of that very nicely. If the criticism is that you could have done better if you had waited for six more years, or until today, to negotiate it, we would not have had much of the development in the province that we have had.

We're aware that the treaty is going to be renegotiated in 1991, and the Columbia River power is included in the power plans for the province. Now just how it will be dealt with, I can't say at this time, because I don't want to make a firm decision now about how it might be used, so that we don't

[ Page 8142 ]

make a decision too early, until we can see what the power needs are going to be down the line. I can assure you that it is part of our power plans, whether the power is coming back or whether there is some other way that it's going to be utilized, but at this point in time to say exactly what the plans are, I couldn't say.

MRS. WALLACE: The minister doesn't know how he is going to use the Columbia River power. It's been estimated that if he goes ahead with the Site C installation, that would be coming on stream about the same time. I wonder whether or not he's looking at the fact that he has the option of using Columbia River power rather than Site C power. I am wondering just where he stands on Site C construction. Certainly there is a long history of Site C as well, and this government up until very recently has had a policy, with which I agree, that you do not build power dams specifically for firm longterm exports. That policy seems to have changed since the Premier's announcement at the opening of Revelstoke Dam.

Back in 1980 B.C. Hydro applied to the provincial government to build Site C, and that proposed dam would be built on the Peace near Fort St. John. It would have a capacity of 900 megawatts and would cost about $3.2 billion. At the peak there would be 2,000 construction jobs; permanent jobs, approximately 25. The Utilities Commission held one whole year of public hearings, and I and many of my colleagues participated in those public hearings. They decided against the proposal. They noted that there was no B.C. demand at this time for the energy, and that B.C. Hydro's energy demand forecasts have been extremely high. They have been unrealistically high and unreliable. They also concluded that Site C would lead to an increase in hydro rates — if it was built too soon and if those costs rose. They said the construction of Site C — and we all know this — would destroy 7,150 acres of land. That is an area 18 times the size of Stanley Park. There would be flooding of highways. Transmission facilities would use up that land, 3,000 hectares of which are class 1 and 2 agricultural land – irreplaceable land. You know that, Mr. Minister.

I know that you were there in a different capacity, as the local MLA, at some of those hearings. I remember seeing you there when I was up there. The BCUC found that the construction of Site C would do over $1 million worth of damage to forest land, a fast-disappearing commodity in this province. We've seen a lot of forest land disappear under reservoirs. There would be $11 million worth of damage to forest lands, recreational and heritage resources, wildlife and fisheries. The material that was presented to those hearings showed very clearly that the costs of Site C would exceed the benefits, and were likely to exceed it by something like $500 million. The public utilities commission concluded that the provincial government apparently does not have an economic strategy to guide energy developments in British Columbia.

So I am wondering, Madam Chairman, where this minister stands. He says that they don't know how they are going to use the Columbia, but they know it is there. What is his position on Site C? Is he going to go ahead and build it now, even though it is going to create a horrendous debt load on Hydro? Is he prepared to build it for long-term exports? Can he give a commitment to this House that he will not proceed with that dam unless it can be proved irrevocably that it is an economically viable operation – which no one to this point has been able to prove?

[12:00]

HON. MR. BRUMMET: It would appear from that member's interpretation of the Site C hearing report that there is nothing that will ever prove to her that it would be viable. I guess it's a matter of what you're looking for in it. The Site C hearing report pointed out that there are losses. Anytime land is flooded, there are losses. These can be compensated for. Her land figures are stretched very much. Much of it happens to be in my back yard. I happen to know that river. Much of the class 1 land that you talk about being flooded is now on islands. Islands have been silted in and, yes, it has provided good soil. But under present conditions, with no bridges, with nothing there, the land is not being used. So the member stretches those 7,000 hectares or acres or whatever numbers she is using to try to make her point. In other words, I take it that your mind is made up regardless of what the commission found.

The jobs. Yes, it is possible to look at the high level of jobs during construction. But if we were to accept your attitude in British Columbia, back before any of these dams were built, and take your rationale that because of the flooded land, because of some of the costs associated with it, there should be no hydro dams built in British Columbia, then there would have been many jobs that wouldn't exist in British Columbia that have been created because of the availability of the electricity that is there.

As for my position on Site C, I think I made it clear at that time that yes, I thought that with the Williston reservoir already established, a huge reservoir, and the re-use of that water, the trade-offs were minimal. For a minimal loss of farmland, of forests.... A lot of that has already been logged over. You can always put numbers to it. In relative terms, with a major reservoir already established and the ability to re-use that water for maximum benefit and the compensation that could be given to the region for any of the losses, certainly the dam made much better sense. Mitigation measures could be taken to make it a tourist attraction. There are tourists now visiting the Bennett Dam. All these things have added greatly.

As the member probably is aware, the people in the area, despite your great efforts to talk them out of it, are supportive of these projects. They would just like to see the proper mitigation.

The member keeps referring to my comment that we don't know exactly how we're going to use the Columbia River power. I did say, however, that it is included in our planning for the future electricity needs in British Columbia. All I said is that we don't know exactly how we're going to use it. The member tries to translate that: "And we have no idea what we're going to do with that power." No, it's included in the total plans, as is Site C.

Yes, the intent has been to create jobs in this province, to try to make an available supply of electricity, to proceed with Site C. Many of the construction workers would probably be very happy with that.

The statement has also been made by both the Premier and the chairman of B.C. Hydro, and is supported by me, that Site C will not be built unless it is to the benefit of the citizens of British Columbia — economically and viably, whatever terms you want to put on it. Any projection you make, low, high, medium — even the lowest projection indicates that we are, in time, going to need much more power in British Columbia. We do not share your doom and gloom that British Columbia is not going to grow. It is going to grow. We know it's going to grow. Any of the lowest projections....We

[ Page 8143 ]

talked about mining here a minute ago. That requires electricity. If we can make our mining industry successful, we'll need a lot more electricity. We could need it quickly, and it takes eight to ten years to get there.

We can build Site C now, and with the proper negotiations we can get the foreign buyers, the California market, to help us pay for Site C. It's a costly dam, as any of these are, but in relative terms.... All you have to do is look at some of the other environmental concerns of nuclear and oil and that sort of thing for generating, and you can recognize, as is recognized worldwide, and envied worldwide.... If they had the hydro ability that we have here in British Columbia, instead of having to go the other more expensive routes, they would be delighted. Compare power rates in other countries and other provinces and you'll find that very few of them are lower than in British Columbia.

Yes, our hydro is a potential, a fantastic resource, and we will build Site C Dam. I would like to see those jobs started tomorrow if possible, but not at a cost to British Columbia. We think that we can negotiate a deal that will provide benefits to the province. That has been clearly stated, and if we can get them to pay for half or more or all of the costs of building that Site C Dam, which we're going to need eventually, that will benefit British Columbia rates.

MADAM CHAIRMAN: Shall the member for North Vancouver-Capilano have leave to make an introduction?

Leave granted.

MR. REE: Madam Chairman, I'd like to introduce two young ladies from the Republic of China in the gallery today. I'd ask the House to welcome Luo Qi and Zhong Gang to Victoria. They're on a technical interpretive course at Malaspina College. This is a one-year course. I think their visit today is appropriate, since we considered the Commercial Arbitration Act earlier. This is the sort of thing that the course is directed toward and may assist in China or British Columbia in the future with respect to that act.

With them, their guides for the day are Stephanie Law and Maurice Gallant, also from Malaspina College in Nanaimo. Would the House please welcome the four of them.

MRS. WALLACE: The minister has tried to indicate that his way is the way to go. He has a megaproject mentality, and he thinks that if we're opposed to a megaproject, we're opposed to construction, to progress; that we have a negative attitude. That's just not true. The power produced by Site C Dam construction will range anywhere from 11 to 13 cents per kilowatt in cost. That's minimum cost. Are you going to be able to sell it to California for that price? Not likely. California is already almost saturated with electricity. The only reason we've had good sales this year is the fact that those Washington reservoirs were dry. We still don't have any means of getting it down there.

[Mr. Ree in the chair.]

There are many questions, but apart from all that, it's a different concept. I'm not sure, but I think you said that you would build it for the benefit of British Columbians. There's a difference between firm, long-term power exports and interruptible surplus power; different concepts entirely. We certainly found that out with the Columbia River. That's the part that's worrying us.

You talk about jobs. There are nearly 60 small hydro sites in this province that could be constructed at a lower cost per kilowatt than the cost of Site C. They would produce more construction jobs and be scattered around the province, rather than centred in one location. They would have minimal environmental damage, and in at least three instances would replace existing diesel plants, which are very costly. That's the kind of a construction program that would really benefit British Columbians, but to go ahead with a megaproject when every one in the past has proven to be extremely costly?

We've seen the kind of increase in indebtedness that Hydro has accumulated over the last few years. A tremendous proportion of our provincial indebtedness is Hydro; 46 percent of our total indebtedness can be put right down as Hydro's responsibility. We've seen tremendous increases in the charge for hydro to ordinary British Columbians — a 150 percent increase since this government took office. In the past two years alone Hydro has been charging an interim rate increase of 10.25 percent to help make up for spending on the Revelstoke Dam and the Cheekye-Dunsmuir transmission line, both things that were not required, not operative — using Revelstoke to sell interruptible power, and some of it is firm for a certain period of time. That's okay seeing we've got it, but it's not even making the interest on the cost of that dam. That's not good economic sense.

No discounts for residential customers. You've introduced discounts for industry, but residential customers are bearing the brunt of those excessive hydro rates. It's on the backs of the ordinary people of B.C., who are paying off those unnecessary debts. This government is afraid to look at alternatives. It's afraid to look at anything except a megaproject. It sees that as some kind of monument, a headline venture which is somehow going to bring them kudos. What it brings us is debt, and that's been proven with B.C. Hydro — horrendous debt.

We need to have some better planning, some more realistic planning. We need to be a little more consistent in relating our actual needs. I don't really blame Hydro, because their mandate, at the courtesy of the cabinet benches, was to make sure that there was ample power in this province, and they did. Ample supply — they didn't say there was anything wrong with oversupply, so they certainly ensured that, and they built a bit of an empire there. I know that from firsthand experience, as the minister knows.

There we are with that situation, and now we hear that this minister somehow thinks that he's going to go ahead with that dam, that somehow he can prove that it is the viable thing to do. It's most unfortunate, because if that thing is started, then it is very hard to turn back. It is such a poor alternative to the other things that could be done.

Retrofitting. You know, we are the most wasteful people in the world with our energy. Yet there are no real programs to ensure that we tighten up our usage of electricity or energy generally. It's obvious that the minister is not prepared to take a good long look at a change of direction for B.C. Hydro, and that is most unfortunate.

We had the Cheekye-Dunsmuir construction and Revelstoke. If he took a hard look at the costs of that, the operating costs in 1984-85 were $1.942 million, and this was an increase of $366 million, or 23 percent, over the previous year.

[ Page 8144 ]

Now the main reason for that increase was Revelstoke and the Cheekye-Dunsmuir, both of which are now.... You know, the Cheekeye-Dunsmuir is sitting there doing practically nothing. There are many alternatives for Vancouver Island, and that capacity that is already installed at Cheekye-Dunsmuir is ample with those alternatives to see us through for a good long time. We certainly don't need to be looking at any further power supply to Vancouver Island.

[12:15]

I have a couple of incidental questions that I'd like to ask about B.C. Hydro. I don't expect the minister to have the answers today, but perhaps he can get them over the weekend and bring them back to me. One of them relates to the former member of the management staff, Norm Olsen, who has retired. I'm not sure of the date of his retirement. What I would like to know is what his salary was at the time of his retirement, whether or not he is on pension and what the size of his pension is. I would also like to know whether Mr. Olsen is still working for Hydro or whether he did work for Hydro on contract after his retirement, what the amount of his contract was, whether he had a vehicle provided in that contract and whether or not his pension continued during the time of his contract.

I know those are rather detailed questions, and as I say I don't expect an answer from the minister today. But before his estimates are over. I would like to know just what the situation is with Mr. Olsen — whether he is still under contract, and if not, how long he was under contract, and the questions relative to his previous salary and his pension. There was a time when Hydro used to make those figures public, and I used to get a statement which had all those figures in it. For some reason, that particular document has now been given a very restricted circulation. It is very difficult to get that information anymore, and that is why I am asking this of the minister on the floor of the House.

Another question I would like to ask him is whether or not he is in negotiations with NKK of Japan relative to the building of a polycrystalline plant, which is a high user of power. Apparently 30 percent of the cost of silicon chips is its energy usage. If so, what sort of incentives are being offered to that company to come here, what sort of environmental protection is being written into any contract, what kind of price would they be getting energy for and how many jobs would they be creating? My information is that it would be a cost of something like $100 million to employ 100 people. I don't know if the minister can tell me whether or not he is going ahead with that or whether that is a dead issue now.

I would also like to ask a specific question about the current chairman of Hydro, Mr. Johnson. I understand that Mr. Johnson is connected with a company called West Fraser Building Supplies, which is a manufacturer of machinery that is used in the production of forest products. I am wondering whether or not any of the companies which have been given special rates under the Critical Industries Act purchase equipment from West Fraser Building Supplies.

Now I know those are somewhat detailed and specific questions, and I don't really expect an answer from the minister on those specific items at this point in time.

I think perhaps I will take my place at this time in case the minister has any answers he does want to give me. Then we can go on with a different subject.

HON. MR. BRUMMET: I would like to thank the member for her questions towards the end. Certainly I have some difficulty with her observations in the first part of her presentation, in that she somehow or other is predicting a price per kilowatt from the Site C Dam. I don't know where you get those figures, but we are told from the people who are negotiating that they think they can provide hydro power at a saleable price.

As we indicated, the dam is not going to be built if we can't sell the power, if' we can't negotiate an agreement. Obviously if the price is too high, there are going to be no buyers. So if your figures are right, then obviously you have no problem. The other thing that member informs me, or has put on the record, is that California is now saturated with electricity. I wonder if she might do a little research on the latest California power plan; in there it is fairly clear that California is going to need power.

The only power that they now have is very high-cost power, high-cost alternatives, and probably environmentally much more sensitive alternatives. So I am sure that California would hardly be spending this time negotiating and asking us to supply power if their utilities had no need for it. They seem to think they have a need for it, so again I am not quite sure where your research goes.

You seem to be quite adamant about the export of power, and yet the Manitoba rates, I think, are slightly lower than the British Columbia rates. The way they are doing that is by major firm export contracts. That's exactly what we're trying to accomplish here, so I don't know whether socialism changes between British Columbia and Manitoba. Manitoba is now talking about their limestone project. It's a massive project that they're building for what? Strictly for export sales. They seem to create jobs there with it. Perhaps you could check into that.

As far as the member's accusation that we are locked into megaprojects. it seems that there's something derogatory about anything big, so by putting the megaproject title to it there's something wrong with it. The planners, the people who are building plants, seem to come up with the figures that indicate that if you build a bigger generator, your cost per kilowatt hour goes down. We have no hangup about small hydro projects. But every stream that you put a small dam on.... You can put 10 or 50 small dams on small streams, and then you've got to deal with fisheries on every one of those streams; you've got to deal with the environmental concerns there. To say that there's absolutely no environmental effects from small hydro.... I wish that were true. I happen to be looking at a lot of information on small hydro. If the numbers are there, believe me, B.C. Hydro, ourselves, whatever, would go for those. I hope that they can come up. I can accept the member's idea that they would be spread out in different parts of the province; I would like to see it happen. All of the investigation in the past....

I've had a problem up the Alaska Highway, where people are paying very high rates to generate their electricity with diesel. I've taken quite a hashing from my own constituents in that area. The only thing that l haven't come up with is the answer. In other words, we've looked at small hydro. The only thing that seems to be a viable answer is to subsidize a service station by $3,600 or $4,000 per month to keep it open. If we open that, it goes everywhere. I'm trying to supply them with information. Believe me, I would like to have solved that problem that's in my own constituency. I'd like to have come up with a small hydro project. I know there's water there. I know the area reasonably well. We have not come up with a cost-effective situation yet that will do

[ Page 8145 ]

anything. I'm back at it. We're still studying it, and I hope we come up with the answer. I would plead with that member that if she has an answer of where we can put in a little project in a small stream, I can use it in my constituency right now. I'll do everything I possibly can to use it. If you've got those numbers, for heaven's sake give them to me. I've tried almost everything so far, except — and I'm getting somewhere on that — for individual households, or a service station, or something. I'm hoping to make sonic progress, but anywhere it spreads out beyond that, the numbers are not there. It's very expensive power. So if you've got it, please let me know about it.

The member mentioned the Cheekye-Dunsmuir. As the economy has turned out, I guess the capacity was overestimated. But I think your concluding statement was well worthwhile — that we now have the capacity on that line to bring power to Vancouver Island. All we need is the development here, and that's what we're working on. It's part of our economic strategy to try to get that going.

We talked about mining earlier. If we could get more mines going, we'd get more power use. The facilities are in place. I can't be completely negative about that, as some other people can: if you build a railway, to use an analogy, you should build only for what it needs to carry today, don't look to ten years in the future. In other words, if you're going to build the line anyway, you might as well plan it. So I think that in the long run.... For instance, had we not built the Bennett Dam in this province until today, imagine what the cost would have been. At that time it was only about $600 million. So I'm glad that somebody at that time built ahead. And with hydro you have to plan eight to 12 years ahead from the time that you anticipate it. I would rather have a little power to spare — because we can leave it in the reservoirs or we can try to market it elsewhere — than all of a sudden have a situation where in two years we have great economic growth and no power to feed it. So I'd rather be a little on the side of surplus than under.

As the member knows, we're also talking about demand. You can take a number of figures as to average demand, peak demand and that sort of thing, and I think the member knows enough about hydro generation that.... When you need six billion kilowatts on December 24, you haven't got it stored anywhere but in the capacity that you have, and if that can't meet your peak demand, then you have brownouts. There have been a lot of inter ties and suchlike done throughout this northwest to try to make sure that if one has got a high peak — and they often tie together.... Anyway, we can level out those power.... Without that levelling-out process there could be times when there could be difficulties. We have to have much more capacity in a capacity-driven system such as hydro than in a demand-driven system such as coal.

I'm trying to answer these questions as they came up. As far as Mr. Olsen is concerned, I'll have to get a few more particulars. I'm aware of the situation there. but I don't have the exact numbers. I'll try to get back with those.

The document that you mentioned which is in circulation: could you be a bit more specific? We're not trying to hide any information. In the annual report all of that comes out. Whether you somehow got dropped off the distribution list or whether they've changed the document, I don't know, but certainly any information is public because it goes to the B.C. Utilities Commission. They make sure it's public. So we have these checks and balances, and anything that is available is certainly available to you.

The NKK polycrystalline plant is really being looked at and discussed by my ministry, by Industry and Small Business Development. and others. So I'm sure there will be a thorough review made of that, and not looking at damages.

As far as Mr. Johnson's relationship with West Fraser, I know he was on the board of directors there. He was looking after that, got into Hydro part time, and then my understanding is that as that job grew.... I'll double-check, but it's my understanding that he has severed his relationship from the board of West Fraser. Your question was, I think, was any machinery of any kind anywhere in this province bought from firms he was associated with. That's a pretty complex question. If I know Mr. Johnson, I can assure you that he would lean the other direction to make sure there were no opportunities for him to be accused of favouring a vested interest.

[12:30]

MRS. WALLACE: My understanding is that it was Sauder Industries of which Mr. Johnson divested himself, and that he still was the head of West Fraser Building Supplies. It was only in connection with critical industries, where special advantages were given. I was wondering whether there was any tie-in there.

I'll certainly get the information relative to the document that I'm no longer able to get.

I'm wondering, Mr. Minister, whether you ever read your own reports. It's right in that report — the Site C report and recommendations to the Lieutenant-Governor-in-Council on the disposition of British Columbia Hydro and power plant application for an energy project certificate for the Peace River Site C — that I'm getting my figures of the cost per kilowatt as projected for Site C. The one on small hydro plants is also a provincial report which was done some time ago on proposed or possible small hydro plants. They're both provincial documents, Mr. Minister. That's where I'm getting my information.

Perhaps we should move on to another area. I wanted to discuss with the minister the off-shore-oil report that was filed recently, which recommends some very extensive environmental work before any actual drilling takes place. There's a real concern that there is not enough knowledge there. They've also indicated that they have some concerns. Even though they were explicitly told not to talk about the Indian thing, they have done that and said: "Look, we cannot proceed without some solution relative to the native Indian land claims." They recommend that at this stage the only action to take is a two-year seismic survey program with ongoing monitoring of the effect on the fish population. That is where they conduct surveys to map the sea bed and find the best sites for future exploratory drilling. Even that action has a number of terms and conditions.

Regarding the actual drilling, the report is not recommending that approval be given until a long list of studies and programs, mechanisms and background material has been completed. It seems to make good sense. When we now have far more oil than we know what to do with, why would we go ahead and start drilling here? Oversupply seems to be on the minds of so many people that they want to get more and more than we really need.

I would like to know whether or not the minister is prepared to accept this report and these recommendations,

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and whether or not he can assure the House that there will be no permission given to go ahead with the actual drilling; that only the exploratory work will be done, and that will be done along with all the environmental information that is suggested.

I think that the panel has come in with a very good report done under some duress. I think that your predecessor had different ideas. The little pamphlet that surfaced when the panel was sitting here in Victoria.... On the very day that the hearings began, the former Minister of Energy here in B.C. was circulating a pamphlet at a trade show saying: "Come on, folks, we're going to open up the shores here for exploration with easy-to-live-with regulations." That was a bit of a blow to that panel. It certainly indicated to me that the government had made its decision before the report was even in. There was also the concern and seeming difference of opinion between the federal and provincial authorities whether the panel had the right to say "no exploration." The provincial authorities apparently took the position that they did not have that right; they only have the right to come up with some recommendations as to how this should go. The federal minister said: "Yes, you do have that right if you decide that we shouldn't go ahead at all."

Now that is after the fact, because we now have the panel's report that says yes, exploration with all these provisions, but no actual drilling. So I would like the minister's comments on just where he stands on that issue.

HON. MR. BRUMMET: The offshore panel report recently submitted is being reviewed by the ministry and by industry. Chevron is looking at it; I guess everyone is looking at it. As I understand it in a nutshell, the panel said that there is no reason why, since it is going on elsewhere in the world, there can't be offshore oil exploration eventually. But they have put a lot of terms and conditions on it. So they have said it can go ahead, but subject to terms...very environmentally concerned, as all of us are.

I suppose again it is what you are looking for. I guess you see those terms and conditions as being able to prevent it. You may have your wish. It may be that Chevron will take a look at it and say that the terms and conditions make it impossible. As you know, you can make any terms and conditions so that nothing happens. So far you seem to be against hydro dams, you seem to be against oil drilling. You seem to be against a lot of things, and yet you constantly are talking about job creation and economic development in British Columbia. l don't know how you do those things when you're constantly against every possible project that is happening in other places — and safely.

There's always a risk. Generally you say: "Can you give assurance that nothing will ever go wrong"" No. But in the rest of the world things are happening, because people don't wait until they can decide that nothing will ever go wrong or that there's no loss associated with some benefit. There's always a trade-off in any situation. I guess that's what we have to decide.

As far as the right of the panel: again you say to appoint an advisory panel, and then immediately you want to give the advisory panel the final decision-making. I can see what my predecessor said. No, the final decision-making rests with government, responsible to the people. So there's no question about where the final decision power is. You can't have an advisory panel. You can't have every study that then comes up with a recommendation to say they are the final decision and no one else does it. If it's a good study and a good recommendation, any government goes against it at its peril. We're all well aware of that. But surely we can't delegate decision-making to every study group.

I did want to get back, since I've got some better information, to the Columbia diversion. I guess I got misled by your '91 statement; it actually comes up in 1998 for renegotiation — between 1998 and 2003. One of the terms, besides the money that we got for originally building the dam.... Part of the agreement was that after the 30 years, Canada gets one half of the U.S. capacity for generating electricity, due to the storage in British Columbia. If you forecast that from 1988 to 1999, where it starts out at, say, 420 gigawatt-hours of power, that gradually builds up to over 4,000 by the year 2006 — 4,000 gigawatt-hours of power available back to British Columbia. For comparison, the Site C Dam would generate about 4,600 gigawatt-hours of power. In other words, yes, that is part of our plan, the return power that we are going to get. So that gives you some indication of numbers.

Again, a poor water year could make a liar out of me immediately, if it doesn't quite materialize. You just cannot predict the water supply and the demand and the use in any year ten years ahead and guarantee that figure. With that proviso, these are the best estimates that we have. Most developments are built on best estimates. No development in this province happens unless somebody estimates what the costs are going to be, what the benefits are going to be and what the profits are going to be. The only people who can ignore that are socialist governments. You know, it doesn't matter, they just pass it on to the taxpayers.

MRS. WALLACE: Very briefly, the minister is trying to say that I'm against exploration. I didn't say I was against exploration. What I'm suggesting is that that advisory committee has done a lengthy and detailed study and come up with the recommendation and with some suggested environmental protection measures. What I was asking the minister was whether or not he was prepared to commit his government to accepting that report and going that way. He obviously isn't. They're looking at it and thinking about maybe not accepting it — from what it seems he's saying.

I talked about the power grid and the fact that we have to have this peaking power. Sure, we have to have peaking power. Unfortunately our grid can't run east to west rather than north to south. The time differential would certainly make a great difference, but geographically that's almost impossible. You know, there are other ways of coming up with peaking power than building hydro dams that are there all around the clock. New York state has come up with a system whereby they pump water up during the off-hours, midnight until 5 or something, and into a high-head plant. They can then release it during the peak period to make up for that. Now that's a much cheaper way than building a whole new operation. That's just one example of the things that can be done.

I have another issue I wish to raise with the minister, but I think that my colleague is anxious to get a few questions in, so I will sit down at this point.

HON. MR. BRUMMET: Very briefly, I'll respond to the member that with the hydro grid we have — the grid developing east-west with the southern B.C.-Alberta intertie, and we have the north-south one — there is power moving back and

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forth as needed, for the best use that can be made of it. I think that that's about all the....

As far as the review panel is concerned, I don't want to leave on record what seemed to be an innocent enough distortion that because we're reviewing it and haven't made a decision about.... I said that the government holds decision-making power. I think that somehow or other the member worked in there that the government has obviously decided not to follow the recommendations of the report. I want to clear that up. It was this government that set up that offshore panel. I was involved as Minister of Environment when my predecessor was involved in it. We set that up. We wanted to say: can we go ahead with oil exploration in British Columbia, as they do in the rest of the world, without damaging the environment? We're looking at that report very carefully, and we are very interested to make sure that we do protect the environment. I don't want to be put in the position that we're going to ignore the report. I don't want that left on the record. Thank you.

The House resumed, Mr. Speaker 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 12:44 p.m.

Appendix

AMENDMENTS TO BILLS

20 The Hon. B. R. D. Smith to move, in Committee of the Whole on Bill (No. 20) intituled International Commercial Arbitration Act to amend as follows:

SECTION l, in subsection (7) by deleting "Unless otherwise agreed by the parties, where arbitration agreement" and substituting "Where an arbitration agreement".

22 The Hon. B. R. D. Smith to move, in Committee of the Whole on Bill (No. 22) intituled Commercial Arbitration Act to amend as follows:

SECTION 27 (3), in the proposed section 27 (3) by deleting 'An order" and substituting "An amendment or variation".

SECTION 51.1, by adding the following section:

Supreme Court Act

51.1 Section 11 (2) (c) (i) of the Supreme Court Act, R. S.B.C. 1979, c. 397, is amended by striking out "Arbitration Act".

SCHEDULE, in Column 1 and Column 2 of the Schedule by deleting "Supreme Court Act" and "11 (2)" opposite it respectively.