[ Page 8319 ]

CONTENTS

Oral Questions

JobTrac. Mr. Gabelmann — 8319

Social housing. Mr. Barnes — 8320

Louisiana-Pacific. Mr. Williams — 8320

Irradiated food. Ms. Sanford — 8320

U.S. shake and shingle tariffs. Mr. Williams — 8320

Mr. Skelly

Presenting Petitions — 8321

Private Members' Statements

Indian fish claims. Mr. Davis — 8321

Hon. Mr. Gardom

Opportunities for young women. Ms. Brown — 8322

Hon. Mr. Nielsen

Telephone solicitations for funeral services. Mr. MacWilliam — 8324

Hon. Mr. Veitch

Job creation in B.C. Mr. Reid — 8325

Mr. Lauk

Forest Stand Management Fund Act (Bill 6). Second reading. (Hon. Mr. Heinrich)

Mr. Mitchell — 8327

Mr. Lauk — 8328

Mr. Macdonald — 8329

Hon. Mr. Heinrich — 8330

Assessment Amendment Act, 1986 (Bill 7). Second reading. (Hon. Mr. Curtis)

Hon. Mr. Curtis — 8330

Mr. Williams — 8331

Mr. Davis — 8331

Mr. D'Arcy — 8332

Hon. Mr. Curtis — 8333

Income Tax Amendment Act, 1986 (Bill 8). Second reading. (Hon. Mr. Curtis)

Hon. Mr. Curtis — 8334

Mr. Cocke — 8334

FRIDAY, MAY 23, 1986

The House met at 10:06 a.m.

Prayers.

HON. MR. BRUMMET: Mr. Speaker, I know that members on both sides of the House will join in mourning the death this week of a great British Columbian, the father of the oil and gas industry, Frank McMahon.

Born at Moyie in the east Kootenay in 1902, Frank struck it rich in the Alberta oil boom of the 1930s. He turned his attention to this province at that time. For years he enthusiastically promoted the petroleum potential of north-eastern British Columbia, and was the driving force behind the construction of the Westcoast Transmission plant and pipeline system which carries natural gas from the northeast to the lower mainland and the U.S. border.

In my own constituency he is honoured and revered as the father of the gas industry, and the plant at Taylor is often still referred to as the McMahon plant. As a supporter of sports, he's also known for having constructed the McMahon Stadium in Calgary. The 650-mile pipeline, together with its gathering system, processing plants and compressor stations, stand as a monument to the vision, enthusiasm and hard work of Frank McMahon.

Frank went on to other triumphs in other places, but it is as the founder and first chairman of Westcoast Transmission and the man who opened up the gates for B.C. gas export to the United States that he is best remembered in his home province of British Columbia. His passing, even at the age of 83 after a full and constructive life, is greatly regretted.

I'm sure all members of the House will join with me in expressing condolences to his family. I will be sending a letter to Mrs. McMahon. and if it's the wish of the House I could include an expression of recognition and condolences on behalf of all members of the House.

MR. SKELLY: Mr. Speaker, I can say, on behalf of the official opposition in the Legislature, that we join in the tribute made by the minister to Frank McMahon and to the achievements of that individual in the energy industry in British Columbia. We also hope that he will join our names in the official opposition to his expression of condolences to the family.

HON. MR. VEITCH: Mr. Speaker, seated in the members' gallery today are some very wonderful people: first, my wife Sheila; from Ontario, my nephew David Boyce and his friend Mark Chandler; and the director of the Burnaby-Willingdon constituency association, Mr. Narinder Dhir and his son Robin, and his uncle and aunt from London, England, Mr. and Mrs. M. L. Dhir. I would ask the House to please bid them welcome.

MR. BARNES: Mr. Speaker, I am very pleased to introduce the manager of a very successful people's cooperative restaurant, Isadora's, on Granville Island, Mr. John McBride. I would like the House to make him welcome.

Oral Questions

JOBTRAC

MR. GABELMANN: Mr. Speaker, there is a report called "TRAC Evaluation Phase 3 Report," issued in March 1986, which among other things recommends that the fractured conglomeration of programs, jurisdictions and initiatives that TRAC currently competes with, cooperative education programs, Canadian job strategies programs, apprenticeship and journeymen and on and on.... It suggests that a provincial plan for manpower production in the vocations is necessary to reconcile and integrate the welter of programs currently available.

I wanted to ask a question about that to the Minister of Labour (Hon. Mr. Segarty) but I see he is out trying to get some votes for his leadership campaign. So I redirect the question to the Minister of Post-Secondary Education. Yesterday the Minister of Labour, the Minister of Finance (Hon. Mr. Curtis), the Minister of Post-Secondary Education (Hon. R. Fraser) and the Minister of Human Resources (Hon. Mr. Nielsen) were going to have a press conference to announce a new program called JobTrac. Other events yesterday I think forestalled that press conference.

I wanted to ask why in this announcement that was going to be made yesterday the government rejected one of the major reports in this TRAC report which recommends the consolidation of programs in favor of a paper-thin program which provides no new money, despite what it says, and only centralizes information rather than centralizing programs.

[10:15]

HON. R. FRASER: Mr. Speaker, everything done by this government, whether it's by one minister alone or by a combination of ministers, is done in the best interests of everybody in the province.

MR. GABELMANN: I didn't understand the answer, Mr. Speaker. The recommendation to the government says a provincial plan for manpower production in the vocations is necessary to reconcile and integrate the welter of programs currently available. Why, instead of following that recommendation, was this paper-thin program to be announced instead?

MR. SPEAKER: A similar question, hon. member. Further questions?

MR. WILLIAMS: Could the Minister of Finance (Hon. Mr. Curtis) advise the House whether his staff review and approve expenditures of the nature of $7,300 for hotels, $1,460 for luncheons...

MR. SPEAKER: Order, please.

MR. WILLIAMS: ...$1,475 for luncheons, and $911 in the liquor stores for the same Speakers' conference?

MR. SPEAKER: Order, please, hon. member. The last time the member got up the Chair advised him that the question very properly could be placed on the order paper. It is unreasonable to expect that information to be available to the minister.

[ Page 8320 ]

SOCIAL HOUSING

MR. BARNES: A question to the Minister of Housing.

AN HON. MEMBER: Lands, Parks and Housing.

MR. BARNES: I'm only dealing with the Housing aspect. When he wakes up, Mr. Speaker.

In the policies set out for the B.C. Housing Management Commission, employees are required to respect the privacy of clients. Yet a Vancouver Sun report indicates the Minister of Lands, Parks and Housing released the names of some of those applicants to reporters. Why did the minister release those names to the media for publication?

HON. MR. KEMPF: I'll take that question as notice.

MR. BARNES: While the minister is taking the question as notice, would he also bring back to the House the process by which this happened? When I talked to the minister two days ago, he was unable to confirm that the documents had even been issued. I'm wondering if he is aware of what's going on in his ministry. This is a very serious question I'm asking the minister, Mr. Speaker. We're talking about the compromising of the credibility of a commission.

Interjections.

MR. SPEAKER: Order, please. Hon. member, with the greatest respect, first, a question taken on notice must at least prompt a different question by the member, and second, questions must be stated with some brevity.

LOUISIANA-PACIFIC

MR. WILLIAMS: Can the Minister of Forests confirm that at the same time the cabinet approved the zero percent loan to Louisiana-Pacific, they had an outstanding, unpaid stumpage bill from the southern interior of British Columbia, since 1984, that they had ignored and not paid, totalling $71,419?

HON. MR. HEINRICH: Mr. Speaker, the information which the member for Vancouver East has is correct. As a matter of fact, it's something in the order of $70,000. That bill has been forwarded, and payment has been requested by me.

MR. WILLIAMS: Has it been paid?

HON. MR. HEINRICH: Mr. Speaker, I do not know whether the bill has been paid, but I know that the bill is outstanding and payment has been requested.

Interjection.

HON. MR. HEINRICH: Mr. Speaker, how would I possibly know whether or not the bill has been paid, whether the funds have been submitted to consolidated revenue through accounts payable? I think it's important that I know it is outstanding and has been rendered.

MR. WILLIAMS: To the Minister of Industry, then, Mr. Speaker. Does the minister think it's reasonable that the province should loan $25 million at zero percent interest to a company that for two years didn't pay its outstanding $71,000 bill to the Crown?

Interjection.

MR. WILLIAMS: Thank you, Pierre Trudeau.

IRRADIATED FOOD

MS. SANFORD: Mr. Speaker, I have a question for the Minister of Consumer and Corporate Affairs. There is some public concern about the facility that's going to be completed very quickly now in Richmond regarding irradiated food. I'm wondering if the minister has decided to ensure that those people who do not wish to purchase and consume irradiated food will at least have that choice. In other words, has the minister decided that irradiated food will be clearly marked as irradiated food so that consumers can have the choice?

HON. MR. VEITCH: That covers everything from federal government responsibilities to the responsibilities possibly of the Minister of Health, or someone else in government somewhere in this country. However, inasmuch as it does or may possibly cover the Ministry of Consumer and Corporate Affairs, I'll take it on notice and investigate it.

MS. SANFORD: The minister refers to federal jurisdiction on this. I'm making the request specifically to food that has been irradiated here in British Columbia and will be sold here in British Columbia, so I wonder if the minister would take that into consideration as well.

U.S. SHAKE AND SHINGLE TARIFFS

MR. WILLIAMS: To the Minister of Forests. Could the minister advise the House, in view of the disastrous decision of the Americans to put a 35 percent tariff on shakes and shingles and destroy our industry, worth $250 million in the lower mainland region, has the government reconsidered its whole strategy with regard to U.S. protectionism in view of this double-cross by Reagan and the United States?

HON. MR. HEINRICH: The matters of trade between countries are handled by the federal government, the Department of External Affairs and the Prime Minister. If a particular country is desirous of imposing a tariff, it's extraordinarily unfortunate for our industry, particularly when you look at the background of the supply of western red cedar in the United States, and particularly in the state of California.

What I find difficult to understand is that the President, in his letter of May 24, encouraged free trade. His statement on behalf of the U.S. administration with respect to the omnibus bill recently passed by the Congress — the House of Representatives — and the statement that he has issued say that he is opposed to that. What I have difficulty in reconciling are those particular statements with respect to free trade and a decision to impose tariffs on shakes and shingles, which was the President's alone. That decision was put to him; the International Trade Commission was split three-three.

AN HON. MEMBER: What are you going to do about it?

[ Page 8321 ]

HON. MR. HEINRICH: Overtures have been made to the federal government on a number of occasions, asking the Prime Minister to intervene.

Interjections.

HON. MR. HEINRICH: Mr. Speaker, what we have done, even as all provinces across the country have attempted to do, is to ensure that the provinces have some say with respect to the free-trade discussion. Right now the federal government has not yet given any decision, nor given us an opportunity to participate. It's absolutely critical.

MR. SKELLY: A supplementary, Mr. Speaker. Can the minister tell us what representations he has made to the federal government, since Mr. Reagan's decision comes down directly against the shake and shingle industry in one single province, the province of British Columbia? What action has this minister taken, in the absence of the Premier, to make representations to the federal government against this recent action which discriminates specifically against this province?

HON. MR. HEINRICH: Mr. Speaker, the decision was announced by the U.S. government yesterday. The members opposite know full well that the government has been making overtures on a consistent basis with the Prime Minister. The Premier has talked to the Prime Minister....

Interjections.

HON. MR. HEINRICH: Mr. Speaker, I'm not too sure if the members really want an answer to the particular question.

Interjections.

HON. MR. HEINRICH: I'll repeat. The Premier has been in contact with the Prime Minister by telephone....

Interjections.

MR. SPEAKER: Order, please, hon. members.

HON. MR. HEINRICH: I wish to assure the House, Mr. Speaker, that the government of British Columbia is doing everything possible to ensure that the Prime Minister represents the interests of British Columbia in his discussions with respect to free trade. That has been carried on on a consistent basis, and the members opposite are fully aware of it.

HON. Mr. McGEER: The second member for Vancouver East (Mr. Williams) requested to have certain correspondence with the Louisiana-Pacific Corporation tabled. This is the earliest opportunity I have had to provide that correspondence.

AN HON. MEMBER: Does this prove he is wrong again?

Presenting Petitions

MR. MacWILLIAM: I seek the floor to submit a petition.

The petition is presented on behalf of local Kelowna residents who have organized a provincewide protest against recent government actions involving education funding. It reads as follows:

"To the hon. Legislative Assembly of the province of British Columbia in Legislature assembled,

"The petition of the undersigned citizens, most of whom reside in the school districts of Vancouver, North Vancouver, Victoria, Sooke and North Vancouver Island of the province of British Columbia, states that: We are requesting the government review funding for public education in British Columbia. We feel our school board should not be forced to levy local tax increases to compensate for the shortfall in provincial funding. We request an independent assessment of required levels of education service in British Columbia's public schools and the funding necessary to maintain them.

"Your petitioners respectfully request that the honourable House convey this petition to the Premier and the Minister of Education."

Dated May 23, 1986.

[10:30]

Private Members' Statements

INDIAN FISH CLAIMS

MR. DAVIS: Mr. Speaker, wild fish are a common resource. They belong to everyone. They don't belong to any particular individual or company or group or even Indian band. No Indian band council, in my view, in other words, should be able to intercept arbitrarily to take any amount of fish passing through or by its reserve.

Add to this another commonly accepted concept. Fishermen typically are takers, not givers. They reap, but they don't sow. They don't contribute to the enhancement of fish stocks; they don't invest in fish hatcheries or spawning channels; they don't invest appreciably in fisheries research; they don't pay for fisheries protection. Indeed, the pay-out in unemployment to fisheries alone is considerably more than the total tax paid by all commercial and sports fishermen in this province. So obviously fishing is a net losing industry as far as the whole society is concerned.

Harvesting of fish has become a snap. With modern technological developments whole stocks can be wiped out in a matter of days. With sonar, with fast boats and with nylon nets, it's possible to catch entire salmon runs in a matter of weeks. Therefore it has been necessary to enforce closures for much of what used to be the fishing seasons, and the fishery is in fact carried out in a relatively short span of time or a series of short spans of time during the year.

Constitutionally, fisheries is federal. Inland fisheries regulations are also approved, if not written, in Ottawa. It's a federal matter which in part only has been delegated to the province, and that delegation is only to certain inland fisheries.

Suddenly, however, we're faced with a new situation. Fish can be intercepted legally on Indian reserves — certainly on four Indian reserves in north-western British Columbia — as a result of a report and actions taken by the Indian Affairs minister in Ottawa. This has brought federal Indian Affairs head on into conflict with federal Fisheries, and the

[ Page 8322 ]

two ministers, David Crombie for Indian Affairs and Tom Siddon for Fisheries, have met. They've agreed to study the question to develop, hopefully, a coordinated plan. Their action is limited so far to studies only.

They must go much further than that. To me, not only drastic action is needed, but definite action. The federal government should set up a single federal authority to organize it on a businesslike basis, locate a Crown corporation on the west coast with its headquarters in Vancouver, have provincial directors on the board of that corporation, give it the power not only to protect the fisheries stock, police it and allocate catch but also to raise taxes, raise income on a royalty basis, with the determination over the long term to make the fishery substantially pay for itself. This would be in the long term, again, a self-financing operation. But it would eventually dignify the fishery. It would ensure that the different groups which have historic and other claims on the fishery would get a fair and reasonable share, and they would get this because they're participating financially in the entire enterprise. And this I think can apply just as well to our native people. They would be making a contribution. They would be getting a share of the catch.

I think this would be an approach which would resolve what otherwise looks like a very difficult problem to resolve, one which raises many charges, native and non-native antagonisms and much uncertainty, I think it can be resolved by definite action, and I think the province should be urging the federal government to take an initiative of this kind and participate wholeheartedly in it.

[Mr. Strachan in the chair.]

HON. MR. GARDOM: Mr. Speaker, I would like very much to thank the hon. member for his cogent and very well reasoned observations this morning. The government of Canada is very aware of the concerns of British Columbia, and indeed the concerns of all of those people who are involved in the fishing industry. I have to say very frankly, and I regret this, that the government of Canada is all over the lot in this issue at the present time. It's really like trying to stick a bowl of jelly onto the wall to find out precisely what they're doing and why they're doing it. They saw fit to approve these fishing bylaws in the Gitskan area, notwithstanding the fact they had before them the Gitskan claim.

Even in the bylaw is a preamble.... I'll just read it; it's very interesting: "Whereas the Gitskan council and its members presented a claim to ownership of 30,000 square miles, including the Skeena River upstream from Legate Creek and Bulkley River, to the Minister of Indian and Northern Affairs in November 1977...." Since then, this particular band now has before the courts — and I'm not going to offend the rule of sub judice — a claim for complete sovereignty for that area. It's not just the land; it's the waters as well, and everything above and below.

Yet in face of all of that, the two hon. ministers saw fit to approve these bylaws, and at the present time it is my understanding that they're having meetings between the fisheries interests and the band to see if some of these matters can be resolved. Failing that, I would tend to think it's incumbent upon the federal cabinet, which I understand they have the power to do under the Indian Act, to see fit that those bylaws not proceed at the present time.

I would reiterate that it's very refreshing to have a solution volunteered. We will give very careful consideration to the solution that was suggested by the hon. member, and I again thank him for his remarks.

DEPUTY SPEAKER: Before recognizing the member for North Vancouver-Seymour, I'll advise the House that there are a few moments left during this portion of members' statements.

The proponent in reply.

MR. DAVIS: First, there are clearly two federal areas of responsibility: one in respect to native peoples, Indian Affairs, and the other in respect to fisheries. Both go back to 1867, to the origins of the British North America Act and so on. The powers are clearly there. In this case, however, they are coming into conflict; they're being allowed to come into conflict. In the United States, by contrast, fisheries powers are substantially at the state level.

Just south of us in Washington state we have an historic ruling now going back a decade or so which really gave native people substantial control over the fishery. This set up all kinds of stresses and strains in the commercial fishing industry, because the native people were able to take fish in large and substantially growing numbers, and the commercial fishery had to back off correspondingly, in the interests of conservation. We needn't allow this situation to develop in Canada.

I think the federal government must resolve the conflict, but must resolve it in an aggressive and expansionist way, by investing in a corporation which will expand the fish stocks; which will give each claimant — including our native fishermen — their proper place in the queue and will allow an expanding resource to be harvested in an efficient way.

OPPORTUNITIES FOR YOUNG WOMEN

MS. BROWN: This morning, Mr. Speaker, I had indicated that I wanted to talk about one of British Columbia's richest resources: namely, its young women, who with their enthusiasm, their ability, their creativity and their capability, contribute and could contribute so much to enriching the quality of life in this province. I want to start out by saying, however, how sorry I am that none of the ministers responsible for human services on the government side — that is, the Minister of Education (Hon. Mr. Hewitt), the Attorney-General (Hon. Mr. Smith), the minister responsible for women's programs, the Minister of Human Resources and Health (Hon. Mr. Nielsen), or the Minister of Post-Secondary Education (Hon. R. Fraser) — who would be the ministers really responsible for tapping this very valuable resource and helping these women to make the kind of contribution that they can make to the province, are in the House this morning.

They were here for prayers and for question period, a number of them, but they have seen fit to disappear now. It seems that my statements on behalf of these women are going to run into a wall of silence, the typical wall of silence which they have met in all of their contacts and their endeavours with this government. I think the real tragedy of the situation is what's actually happening to the talent and to the ability of these women. When we look at the statistics, we find that unemployment among this particular segment of our society is at an astronomical level, and growing.

We also find that when we couple that unemployment with the disappearance of the resources, the source of the educational programs and vocational programs which these

[ Page 8323 ]

women would need, in the absence of those things, what we I find is that rather than having a rich resource which contributes to the quality of our lives, we are finding that we have a real crisis on our hands as far as these young women are concerned. We are finding that unemployment is increasing, that a large number of them are dropping out of school; 25 percent of the unemployed young women on our statistics we find have not completed high school or are attending school part time. We have something in the neighbourhood of 62,000 young people in this province today who are unemployed, and a large percentage of that, or the greater percentage of that, are young women.

Mr. Speaker, when we look at certain regions of our province such as in the East Kootenays or in Powell River, we find that the participation of these young women in the labour force is as low as their absence from the labour force; as low as 56 percent in the East Kootenays and 53 percent in Powell River. Yet when we look at the information coming out of the Minister of Labour, who is responsible for women's programs in this province, we find that despite the International Youth Year and despite the glossy brochures telling us that the government has a commitment to women, there is absolutely nothing that has been spelled out in terms of how these young women are going to be helped to get out of the unemployment which they seem to be stuck in.

As a matter of fact, their situation has been made worse by the Ministry of Education through its cuts in student loans and through the decrease in the kinds of summer employment programs and other programs which these women need if they are to save the money to meet their fees in the fall either at the community college level or at some other post-secondary institution.

Young women are doubly hit because in fact we know that they do not have the kind of jobs that pay the kind of salaries that make it easier for them to save their fees. Again, when we look at the Ministry of Labour statistics, we find that these women are still concentrated in the job ghettos which pay the lowest salaries, in the clerical job ghettos and in the service job ghettos. So when you couple that, Mr. Speaker, with the cuts in student loans, you find that in fact what we are doing is condemning these young people and in particular these young women to continued poverty through their lives and to a lack of any kind of skill training and education to help them to really make the kind of contribution to our society which they can make.

One of the places, unfortunately, where some of these young women end up is on our street corners plying the trade of prostitution. We hear over and over again from the federal level as well as the municipal level, and even the provincial level through the Attorney-General, that what we need are more stringent laws to curb prostitution, but very little about some of the kinds of causes and some of the reasons why young women find themselves in a position where they have to ply this trade as a means of earning a living.

[10:45]

I think that is really crucial, and I think it really is a kind of neglect which we cannot afford to entertain, this neglect of the young women in our community. The whole question of building into the community resources so that they can get the education that they need and the job training and acquire the skills in order to be contributing members of our society is something that we have to address ourselves to right now.

In 1981, for example, there was something in the neighbourhood of 10,438 of these women who were in receipt of income assistance in this province. In March of 1986, that number had doubled: it is now 20,832. I cannot imagine how a part of the world which is one of the richest countries in the world, and one of the richest provinces in such a country, could tolerate having something in the neighbourhood of close to 21,000 of its young women living on income assistance.

I am sorry that my time is up.

HON. MR. NIELSEN: Mr. Speaker, much of what the member was referring to is very much identified with labour and job opportunities and job creation or training. Some of he comments certainly respond to the role of education.

The member produced statistics and opinions with respect to the difficulty young women have in finding suitable employment and career opportunities, and that is a matter of numbers and opinion which I don't think is argumentative. Perhaps, though, the member's comments reflect to a very large degree the traditional attitude that society as a whole held for a long period of time with respect to the role in society of young women. I believe that over the past we have seen how education — primary, secondary and post-graduate — also assumed a certain attitude and role toward the education of women.

The member mentioned the "job ghettos," as she referred to them, with respect to secretarial work or service industry work, which has long been identified as a woman's role. That's an attitude that society has embraced or developed over many years. Certainly that has been changing and would appear to be continuing to change. There are far greater opportunities for women, young or otherwise, with respect to education, vocations and job opportunities. If one were to review the accomplishment of students at high-school and post-graduate levels, you would certainly find many of the top students in almost all areas of endeavour are young females. It is not uncommon to see the top students of graduating classes being represented by young females.

I think a historical review would also indicate that the statistics the member was referring to have not occurred over the last couple of years, or the last decade, but it has a definite history to that type of job allocation and post-graduate education for females, which is changing very rapidly, and correctly so.

If the member's statement was to bring to the attention of the House the plight of an identifiable group within society, then I think the numbers speak for themselves. But I would suggest that a great deal has been done and is underway now to try to modify that historical situation with respect to the opportunities of young women in our society. I certainly wouldn't disagree with the member if the goal of society is to provide equity for opportunity of men and women.

MS. BROWN: I would like to use the three minutes remaining to me to make a couple of suggestions, because what we need at this point, if we are not to continue to misuse and under-utilize this very valuable resource, are some concrete programs and some action to be put into place immediately, not just through the Minister of Labour and his women's programs, but also through the Ministry of Education, the Ministry of Human Resources, the Attorney-General and certainly the Minister of Post-Secondary Education.

We've got to do something about ensuring that these young women can complete their education, whether it is in the area of increased counselling, more realistic student loans

[ Page 8324 ]

— reinstating a serious student loan program — or even providing child-care facilities for those young women who find themselves single parents. There are quite a large number between the ages of 15 and 24 years in this area. Those programs should be put into place immediately.

These women are threatened by the technological revolution, which we have been told is going to have a serious impact on the clerical sector and render a number of the skills they are still being taught in the school system out of date, redundant and even irrelevant in the very near future. So the whole reorganization of their education has to take place, and skill-development programs in what have been known as non-traditional jobs and in other areas of work have to be put into place for them.

Mr. Speaker, the Minister of Human Resources (Hon. Mr. Nielsen) has left, but certainly one thing that could be done right now is to ensure that the funding for that very important program run out of Gordon Neighbourhood House be reinstated and that program which was so admired by the Prince when he was here, and which brought so many accolades to the program and to the government, be protected, because in fact that program does address itself to those very young women to whom I've referred who see prostitution as the only option because of their lack of education and their lack of job opportunities.

So there are some things that can be done right now by the government. From the minister responsible for women's programs, rather than so many glossy brochures, certainly some actual money could be put into funding some of these vocational and some of these skill programs for these young women to ensure that they do have options and that they do have alternatives to unemployment, income assistance or unemployment insurance.

TELEPHONE SOLICITATIONS
FOR FUNERAL SERVICES

MR. MacWILLIAM: I want to present some information on behalf of concerned citizens in the Kelowna area as well as in communities throughout the north Okanagan; also on behalf of credible funeral directors in Kelowna and Vernon, who are tired of being painted with the same brush of suspicion as a result of activities in Kelowna and surrounding regions involving telephone solicitations for cemetery services.

Doris Hoy of Kelowna has seen the telephone solicitation at its worst. Her husband had been a frequent patient at Kelowna General Hospital, fighting a three-year battle with cancer. Early one morning in November 1983 he lost the struggle, and Doris returned home that morning, consoled by her daughter during her period of grief. Less than two hours after her husband died, the phone rang; it was somebody wanting to sell her funeral arrangements. Quite naturally, she was devastated. She had been called several times before, but this time it was different: this time the caller knew her name and her husband's name. The time lapse between the incident of death and the call was simply too short for coincidence. Somebody knew they had a customer.

Rosemary Lindsay had difficulty with the birth of her third child in February 1986. Shortly after birth the child was pronounced dead at Kelowna General Hospital. Shortly after returning home to deal with their grief, Rosemary and her husband Ted received a phone call from Lakeview Memorial Gardens regarding cemetery services. No public notice of death had been given. Extremely distraught, the Lindsays wrote to the Minister of Consumer and Corporate Affairs. The reply from the ministry suggested the matter was best left to be handled by the industry itself.

In 1980 Mrs. Paulie Ross was diagnosed as having terminal cancer. The diagnosis was done at Kelowna General. Less than one week later, Paulie was phoned by Lakeview Memorial Gardens regarding the purchase of a funeral plot. Her shock and devastation turned to anger after she began to work for a local support program for cancer patients in the Kelowna area called Can-Surmount. She soon found that all terminally ill patients were being called by Lakeview Memorial Gardens soon after diagnosis of their disease. In a letter written to Kelowna city council in February 1985, Mrs. Ross confirms that in the three years prior to her incident, more than 30 terminally ill cancer patients had been phoned within days or weeks following diagnosis of the illness. These patients had not been called before.

Mrs. Anne Higgs of First Memorial Services Ltd. In the Okanagan confirms that the society in Kelowna has fielded a myriad of complaints from relatives who received calls soon after the death of a loved one. First Memorial, by the way, is the contractor for B.C. Memorial Society, which is a non-profit firm. In many cases calls have been received within a half hour of the pronouncement of death, before the corpse has even had a chance to be taken to the morgue.

B.C. Memorial Society representatives insist that their membership list has been confiscated and used by Valleyview Funeral Home and Lakeview Crematorium after Valleyview in fact lost its service contract with the society. A former employee of Valleyview stated — and this is out of a newspaper article in Kelowna — that when Valleyview lost the contract, the employee spent about a week and a half doing nothing but photocopying Memorial Society of B.C. designation forms.

Society members have received numerous mail-outs as well as telephone calls, giving the misleading impression that these organizations represent the B.C. Memorial Society. They do not. The question arises as to whether such action in fact constitutes fraud. Lakeview Crematorium has mailed out brochures soliciting funeral services to members of the B.C. Memorial Society — I've got a copy right here — headlined: "To All Society Members." No mention is made of the actual society name. If you go through it, the information leaves the mistaken impression that Lakeview Crematorium represents the B.C. Memorial Society. It does not. Mr. Ron Smith of Lakeview Crematorium defends his actions by stating he has a contract with Interior Memorial Services Society. According to the provincial registry, which was checked just this morning, the society was dissolved in June 1982 for failure to file an annual report. The question arises as to whether this constitutes fraud.

[11:00]

In theory, the consumer benefits from vigorous competition in the marketplace. In the Kelowna funeral industry, which affects much of the Okanagan Valley — certainly my constituency — there is a wide gap between theory and practice. We find that memorial societies with confusingly similar names are listed; we find pamphlets and cards designed to mimic competitors. We find telephone directory lists of funeral homes which don't even hold a valid business licence. We find unscrupulous business practices designed to confuse rather than to enlighten the consumer. We find invasive and distressing telephone solicitations of those in their

[ Page 8325 ]

period of bereavement. We find a Memorial Society membership list that has been copied and used by a new society representative no longer listed in the society's charter.

Mr. Speaker, I think the facts speak for themselves, and I think action needs to be taken. That action has to be taken through the appropriate legislation, which is in the power of the Minister of Consumer and Corporate Affairs. At this time I will sit down, and perhaps he wishes to respond.

HON. MR. VEITCH: Mr. Speaker, I share the concern and also share compassion with those individuals who in time of bereavement are harassed by some unthinking individual who has only his own personal profit in mind.

There are flakes in any industry. It doesn't matter which industry it happens to be, whether it is the funeral industry or other types of industry. They are not exclusive to that industry or to any other, or to any profession for that matter. But I want to tell you that there are about 400 people in the province of British Columbia who are actively, legally and gainfully employed in the business of trying to sell funerals over the telephone. In no case do I want to impinge upon the ability of those individuals who are carrying on a perfectly good practice — carrying on a practice that is obviously acceptable to the consumer on the other side, to the customer, or they wouldn't be selling the product.

On the other hand, if you have a situation. such as the hon. member pointed out, where a membership list has been confiscated — I think that was the term you used — you may very well have a case of fraud being used. If there are cases of misrepresentation, then you may very well have a very valid point indeed; or if you have a situation where someone is harassing someone over the telephone and causing them problems in their hour of grief, then if that industry can't clean up their act, I'll clean it up for them. But having said that, hon. member, I still believe that these problems are best handled by the industry. If they believe that telephone solicitation is a very good way of handling their business and it is not offensive to people and not harming large groups of people, then I think they should be allowed to carry on with that type of activity. But as I pointed out before, if they are harming people, if they are doing anything that is wrong, if you have any information or if you know anyone who has, pass it along to me or have your constituents pass it on to me, and we'll look after it. I will tell you right now that redress for the consumers will be forthcoming if it is considered appropriate after we make the investigation.

[Mr. Ree in the chair.]

I appreciate the hon. member's statement today. It is not something that I am unaware of. I also wish to tell you, though, that given the preponderance of calls and solicitations made, there are very few complaints made to our office. However, I do appreciate the statement and as I have pointed out, if it becomes a problem, if it requires cleaning up, and the industry is ineffective in doing it, then I guess government will have to do it for them.

MR. MacWILLIAM: Well, I want to add that it is unfair to condemn the entire funeral industry for what I consider to be the selfish actions of a few unscrupulous operators. I also want to add that the industry has many very hard-working people of high integrity who are doing their best to serve those in a time of need.

But it is important that those reputations not be tarnished by the actions of a few irresponsible members. In fact, it is representatives of the industry itself who sought to meet with me on the weekend and highlight these views. Many members of that industry in the Okanagan have stated to me that they would like to see a stop to telephone solicitation because of the potential for abuse. Those are members of the industry itself, and I can give you specific names if you so wish. That is why I think it is time the government stepped in and cleaned up what is becoming a messier and messier situation.

HON. MR. VEITCH: Do you want us to stop solicitation?

MR. MacWILLIAM: I'll get to that in a minute.

It is a situation that is not restricted to the Kelowna area; it has implications throughout British Columbia. The Ministry of Consumer and Corporate Affairs has been aware of these incidents that I highlighted earlier. They are not new news, but no action has been taken. The minister has admitted that the response has been to let the industry police itself. The evidence I have given you. Mr. Minister, is that the industry is not policing itself. The minister should immediately investigate these abuses that have occurred through telephone solicitation that is presently allowed under the Cemetery Act.

For the minister's information, the minister has correspondence on file from the mayor of the city of Kelowna advising that council has gone on record opposing telephone solicitation for cemetery services. Kelowna council has recently passed a similar resolution which has been endorsed by the Okanagan Mainline Municipal Association. The resolution will be brought forward to this year's Union of B.C. Municipalities convention.

Mr. Speaker, the resolution requests that regulations pertaining to solicitation under the Funeral Plan Act be enacted for the Cemetery Act. The members of the industry itself support the spirit and the purpose of this resolution — I don't say they all do, but the ones that I've talked with certainly do — and I would propose that your ministry consider the implementation of such restrictive measures against present telephone solicitation under the Cemetery Act.

MR. REID: Mr. Speaker, I take pleasure in taking my place this morning in the House, and I ask leave to make an introduction.

Leave granted.

MR. REID: In the galleries today, Mr. Speaker, I'd like the House to welcome a businessman from Langley, Mr. Percy Lotzer. Would the House make him welcome, please.

JOB CREATION IN B.C.

Mr. Speaker, job creation in the province of British Columbia has been a very successful program of this government, especially in the last three or four years and as evidenced yesterday. For the first time in the history of the province of British Columbia we have more people employed now than ever before.

During the last year, Mr. Speaker, we created 50,000 more jobs.

AN HON. MEMBER: How many?

[ Page 8326 ]

MR. REID: Fifty-thousand more people are working within the province of British Columbia, which equates, Mr. Speaker, to over 4,000 more people working by the week, per week. Those jobs came about as a result of many things, but one of the job creations was the SkyTrain project. Phase one created 7,500 direct jobs and 15,000 indirect jobs, total job creation.

Mr. Speaker, I'm pleased to indicate that phase two, which brings the SkyTrain, the most fantastic transportation project in the world, instituted in our province in the lower mainland, totally subscribed by every rider of transit within the lower mainland, currently carrying over 100,000 riders per day....

AN HON. MEMBER: The rest of the world?

MR. REID: Better than any other project in the rest of the world, yes, yes, yes. That's why the rest of the world is coming to Vancouver during the transportation fair to look at that project and look at others which are being displayed there, which are going to be trying to compete with a very successful transportation mode.

Mr. Speaker, it's interesting in talking about SkyTrain and with the amount of times it has been raised in this House to note that this government was criticized for job creation within the areas of MLAs representing certain ridings of the government members. But very little credit has been given to this government by the members who most benefited by the construction of SkyTrain.

AN HON. MEMBER: Vancouver Centre.

MR. REID: Vancouver Centre, two of the Burnabys and the New Westminster member made very little mention of a billion dollars worth of expenditure to service their constituents.

AN HON. MEMBER: I ride it all the time. You don't ride it. I never see you.

MR. REID: I ride it every time I get a chance because it's the only way to traverse the lower mainland. Mr. Speaker, I am so proud that this government had the foresight to build that people-mover, that project, one that services over 100,000 people per day and currently the 900 park-and-ride site. That was another vision, another successful project, built on the south side of the Fraser River, and currently is loaded to capacity already. The people in Surrey, Langley, White Rock and North Delta are using the park-and-ride so that they can commute by virtue of a connector bus to the SkyTrain. Another successful project.

It's going to create another 3,000 person years in construction on phase two, on which the tenders were opened two days ago, and surprise, surprise, a non-union contractor was the low bidder. That is an interesting development, because it'll be the first project in the whole SkyTrain construction that will be built non-union.

MR. WILLIAMS: You're proud of that.

MR. REID: I'm proud of the fact that there is an opportunity for every business person in the province of British Columbia, whether union or non-union.

Mr. Speaker, about a year ago we were being criticized by the bus operators because of the advent of automated service, and the SkyTrain was going to destroy the employment opportunities for bus drivers. Well, surprise, surprise: we're currently hiring 125 more drivers to service the increased ridership of people who want to commute from their community to the SkyTrain facilities by bus. So we've got another 125 drivers being hired in order to increase the ridership in the lower mainland, keep the people off the roads as much as possible, and eliminate any further dissection and construction of roads within the lower mainland. So there you go, Mr. Speaker; that's a success story. I think it can be credited to the chairman of the board, who served there for four years very successfully, got the project well underway, and then ran for office and now serves in Victoria.

But the other project which we should talk about for a moment under job creation is the Coquihalla Highway. The Coquihalla Highway, which just opened a week ago today.... Mr. Speaker, I was proud to represent this government as one of the members who happened to be there when that road was officially opened, and saw the smiles on the faces of those people from Hope, Merritt, Kamloops — anybody serviced by highway connections to the interior.

MR. LAUK: All 30.

MR. REID: All 30, eh? I'll tell you how many were there. There were about 3,000 in Hope, and there were about 3,500 or more in Merritt. That's a lot more than 30 people. That's almost the total population that was out to compliment this government, the Highways minister (Hon. A. Fraser) and the Premier of this province, who had the vision to create 26,000 jobs in the interim to deal with the problem of employment within this country. But we got the job done: the best highway in the sky; the best highway construction job, I'm told, in the world, and I believe that.

AN HON. MEMBER: Which Premier — the one who's leaving?

MR. REID: No, no, the Premier's not leaving. Hey, the Premier's not leaving.

Anyway, Mr. Speaker, 26,000 direct jobs; that's phase one. Now we're on to phase two and then on to phase three and then wherever, but this government is committed to creating jobs, and that's the role we intend to continue to do.

The other one — and it's still under construction; it's going to be announced and unveiled very shortly — is the Annacis crossing: 18,000 jobs, 2,700 indirect jobs. Mr. Speaker, talk about job creation; that's all this government has on its mind, creating jobs. Talk about a successful government....

DEPUTY SPEAKER: Time.

Does the member wish to reply? No member wishing to reply....

MR. REID: I'll take the rest of the time, Mr. Speaker.

[11:15]

DEPUTY SPEAKER: The second member for Vancouver Centre.

[ Page 8327 ]

MR. LAUK: Mr. Speaker, in response to the important and urgent business raised by the second member for Surrey, I think it's appropriate to congratulate the government on its planning ability in putting together the transit system, and I felt challenged. The great benefit, of course, is not to Vancouver Centre, although this little member uses that SkyTrain all the time. I can leave my office, and from the point of leaving the front door of my law office downtown I can be at the courthouse in New Westminster in 35 to 40 minutes. It used to take me that length of time to get my car out of the Pacific Centre parking lot.

But the great benefit, of course, comes to the people of New Westminster, Burnaby and Surrey. The Vancouver Centre people have always relied on the buses. There's still a problem with bus service on the east side, where people tend not to have the automobile transportation that people in the other parts of the city have, and it would be nice if the government took a particular view of the needs of the people who need to transport themselves by bus in the east side. Additionally, there should be a program of further subsidization for people who are the working poor and who have to ride buses. We've got seniors' passes, we've got student passes, handicapped passes and a variety of other things. It seems to me that there should be a subsidized system for the working poor who are coming off the welfare rolls and who haven't got automobiles, but who have to pay full fare on the bus and SkyTrain transportation systems.

As far as job creation goes, Mr. Speaker, I'm not going to vigorously attack the member. I think that the record speaks for itself that the province is in a very sad condition as far as employment is concerned. Young people do not have the opportunities that they should have in this great province. I think that the government's planning has been amiss. I think in some areas job creation has been negligent. I think it's clear that the government and its current Premier have not turned their minds to the plight of young people in this province. As many as 30 percent of them are unemployed and have little or no hope. They're losing hope. That's a sad situation. It's not a question of partisan politics; it's a question of reality.

The hon. member for Vancouver–Little Mountain says 33,000 jobs have been created. You know, that member should stop quoting figures and look at the reality of the unemployed people. The figures of job creation are minuscule compared to the problem, and the government has not turned its mind to it. It's been distracted by glitter, by ribbon cutting and by throwing each other bouquets.

Interjection.

MR. LAUK: The hon. second member for Vancouver-Little Mountain is an eloquent defender of his government's position, but the position on job creation is indefensible. No matter how eloquent the hon. member is, the facts speak for themselves. The food banks are there, the unemployment lines are there, the desperation is there. It's a challenge for a government with a vision that this government hasn't got. The government has a vision of the 1950s and 1960s; they're not looking to the 1990s and to the turn of the century. We have a heavy responsibility to provide a future for our young people, and this government has failed to do so.

MR. REID: I want to thank the hon. member for raising the question of the eastside bus ridership and the subsidy.

This government currently is subsidizing the transit system in the province of British Columbia from last year's $74 million to this year's $162 million. I don't know how much the average taxpayer is supposed to burden himself with the providing of transit when, for every dollar that a rider puts in the farebox at the moment, the taxpayer in general puts in three dollars on top of that. That's with the current ridership.

Anyway, to deal with the question of the people in the Vancouver east side and the outlying areas that are currently demanding further and higher bus service, I'm sure as a result of the SkyTrain's traversing of New Westminster to downtown Vancouver, the provision for collector routes now being utilized, rather than the long commuter runs where we waste the time and fuel and the tires of a bus with no riders in it, can now be better utilized in the lower mainland, getting more people paying fares on the system and getting to a regular four-minute service, which is SkyTrain. That's the goal, and that's the role of the transit service, and I think it's an improvement we're going to anticipate and encourage. That's why we had to hire 125 more drivers, because the increase in demand for people wanting to use the transit system has been phenomenal. So the successes of it are, I guess, forcing us as a government and as a transit system to provide even a higher and better service to the areas that are currently underserviced.

I wanted to read a final statement into the record, and it came out of the Greater Vancouver Development Services Bulletin just received yesterday. It says that unlike metropolitan Calgary, our region is not likely to lose population, given the lifestyle commitment of the region. In fact, its population will grow. With its lower unemployment rates, it will attract people from the rest of the province, and people from other provinces and other countries will continue to come to the region for the same reasons that its residents will stay. A recent study indicates that one out of five Alberta residents would rather live in British Columbia. With this continuing population growth, the only cure for unemployment in greater Vancouver will be continued growth in employment.

It is interesting enough, also, that of the Manitoba people polled, one in two would rather live in the province of British Columbia. In spite of the Manitoba government — they all want to leave, I'm sure — they all know what future there is, what job creation opportunities there are in this province, and the kind of dynamic leadership that this province has had and will continue to have under the Social Credit government.

HON. MR. GARDOM: By agreement and leave, Mr. Speaker, we proceed to public bills and orders. I call adjourned debate on second reading of Bill 6.

FOREST STAND MANAGEMENT FUND ACT

(continued)

MR. MITCHELL: It's not my intention to review the statements I made when this bill was up before the Legislature before. I think what I said at that point can be covered in the parable that was part of our growing-up days, where it was said it's like locking the door after the horse has left. Basically what this bill does, or attempts to indicate they are going to do, is that we are going to have a Forest Stand Management Fund Act.

[ Page 8328 ]

I think you as the Speaker and all the members of this Legislature know, over the many years that the New Democrats have been in this House, and social democrats before, we have indicated that if we are going to preserve our forests properly, we must do a full forest stand management. It's not something that can be brought in on a one-page bill that is just a glossy overrun of something that should be built into the Forest Act itself. If we are going to properly manage forests, we must do the replanting, we must do the silviculture, we must do the maintenance of the fire roads, and all these costs have to be built into the true cost of producing lumber. The unfortunate position that this province is in today is because we are open to the suspicion that we haven't been doing it for the last 30 years under Social Credit, and the Americans are using this lack of overall policy with their countervailing duties.

It hits my riding particularly hard, because we have recently restructured Sooke Forest Products, now known as Lamford Forest Products. It employs 200 people in Sooke after they had been unemployed for over a year. That mill is the lifeblood of that community, and now the new countervailing duties put on shakes and cedar hit that particular mill very hard, because that mill is one of the most modern mills with the new technology that must come into the lumber industry if we are going to be competitive on the world market. It is back into operation, but because over the last 30 years when profits were high we weren't looking at forests as a long-term industry of this province....

To bring in a bill now that — I know I can't read sections out of a bill — says that the fund shall consist of money from the government, money appropriated by the Legislature, revenue imposed under section 4 of this Act and contributions from the government of Canada, the municipalities, the forest industry, the forest sector unions and others.... The bill says that that "shall" come from those funds. But we all know that there is no agreement made between the municipalities, no agreements made by the forest industries that they are going to put extra money over and above their stumpage, and no negotiations with the trade union movement that they are going to be putting money into something that is part of the true cost.

I say replanting and forest management is part of the true cost of forests. It should be part of the true cost of lumber. We must build that into our industry. We must look at it seriously. We must see that this is part of a long-range program. It is not something that it appears to be: that we are locking the door after the horses got out. Because if this Legislature, the highest body in this province, doesn't look at it, we are going to be facing more countervailing duties. We can't afford it.

It is my intention to support the bill, not because I really believe it is going to do what we should be doing, but I hope it is a kind of a hesitant step in the right direction. I hope that we are going to look at it, and not put the burden on municipalities which are already under a heavy burden to keep their taxes low enough for the people to continue to maintain their homes.

I don't know what reasoning the government has used to say that the unions are going to participate, and the municipalities, unless there has been some real negotiations. Up until now, from all the groups that I have talked to, we haven't had any indication that this government has any real negotiations in place on this particular matter. But still, they have brought in a bill that indicates that — because they don't state that they may come from these funds; it says that they shall come from these funds. You as a member of the legal fraternity know that if you use the word "shall," that is indication that that is what will happen.

I am worried that we are not looking at a very serious program that must come into this province, complete forest stand management. We must look at it at all levels, and I say through you, Mr. Speaker, to the Minister of Forests that we will be supporting it, but I want him, for the protection of the forest industry, for the men and women who have invested in the mill in Sooke, to indicate that we are going to build this in, that we are not going to be subject to these countervailing duties that may be another detriment to that community. It is important that the government indicate a long-term program that is going to look at forests as an industry that will be here long after we have gone.

[11:30]

MR. LAUK: Well, I can't say that I've been waiting anxiously in the wings to speak on this bill all this session. However, there are a couple of points about it in principle that bother me. As long as it has been in place in this chamber, Hansard has been replete with warnings from the opposition with respect to the management of the forests of this province. They've largely gone unheeded by this government. The government has not taken seriously the management of forests since it came to power in 1975. It has steadfastly ignored some of the more critical problems that have arisen in the last decade. There has been speech after speech by hon. members in this House reciting chapter and verse the problems as they emerged, and as we thought they would develop so they have come to pass. And still the government ignores the problem.

The best example of this government's way of dealing with forest management is the recent complete inability of the government to properly react, and with force, to what has been happening to our relations with our customers in the United States. They have not had an intelligent and perceptive view of those problems. They have steadfastly, as I say, ignored them, to the extent that, I suppose, they hoped the problems would go away on their own.

Other people have been thinking about our forest stand. Most of those people are in the United States. Other people have been addressing themselves intelligently to the problem. We — that is to say, the province of British Columbia — have not. That's why the Minister of Forests can only stand, throw his hands up in the air plaintively and say, "Well, it's a federal problem," or "I did send them a letter," and nothing seems to be done, except that the forest industry is in serious danger. It's under full-scale attack.

This bill really provides another slush fund, if you like, to a cabinet minister. This government has been afraid of the Legislature, in which they have had a majority for the past ten years. I wonder what that tells you about a government. They've had a comfortable majority, and yet they constantly bring bills before this Legislature which take what is traditionally the authority of this Legislature into the hands of an individual cabinet minister. This, to me, is reprehensible. It's inexcusable. And it's a sign of grave weakness on the part of the government — government by Star Chamber, government in secrecy, power in the hands of the Crown. It's our view, Mr. Speaker, that this is another encroachment upon the traditional powers of the Legislature. For the last 400 years it has been said that the power of the purse — the treasury — must be approved and guidelines set by the Legislature or

[ Page 8329 ]

House of Commons. Slush funds or perpetual funds are to be discouraged.

This is one more nail in the coffin for that government, Mr. Speaker. Although the average person in British Columbia does not articulate my concerns in the same way I do, he knows that this government has been a government in secrecy, that they have mismanaged the forest industry to a critical point where we're about to take heavy losses.

As well, the amounts involved under Bill 6 are discouraging in relation to the problem we're facing as far as management is concerned. I will reluctantly support the bill for fear that this may be all that will be contributed toward this important need.

Interjection.

MR. LAUK: That's it.

MR. MACDONALD: Mr. Speaker, I support what my colleague has just said. What kind of a bill has to be drafted like this, in which you say, for example: "We may have some additional levy upon stumpage"? Does the government not know whether or not those additional funds are required? They may say: "Oh well, we may get a big contribution from the IWA or somebody else." But surely at this point the government should not simply say: "We may, by regulation, at any time add an additional levy to the stumpage." That's creating uncertainty in the industry, and they don't know where they're going. If additional moneys come in, good. Then, maybe, you will reduce stumpage 1n some later year if the funds are sufficient.

We're giving blank cheques in this Legislature. Then, the money that is raised with the use of regulations.... And we don't know how much it's to be, or what the effect will be. That money is to be spent just by the minister; the minister — "shall" spend it. Why not go back to the traditional function of a Legislature, which is to have votes and the details of those votes sufficiently spelled out, so that the Legislature is authorizing expenditures as it should be doing? We're drifting a long way off from that course. We're drifting back to legislation by ministerial discretion, the expenditure of funds by ministerial discretion, blank-cheque government.

[Mr. Strachan in the chair.]

I think the Minister of Finance (Hon. Mr. Curtis) should participate in the discussion of this bill. He has seen his own estimates book, which he presents after the budget, being usurped time after time by bills that say: "We may levy money; we can do it by this, by regulation, and a minister will spend it as he sees fit." That's not good enough. That's a departure from the traditional custom of government: the authorization of expenditures by the Legislature. It's a very dangerous course, and it's an arrogant course. There's an increasing arrogance creeping into this government, as it becomes senescent and ready to fall. The arrogance creeps out in this bill and in just about all the other bills, where ministerial discretion is substituted for funds voted, debated and discussed by the Legislature.

DEPUTY SPEAKER: Pursuant to standing orders, the House is advised that the minister closes debate on Bill 6.

HON. MR. HEINRICH: There were a number of statements made, not so much today but last week, when the majority of the debate on second reading took place. The figures which were used often by the opposition seemed to vary anywhere from $300 million to $600 million annually for reforestation. They quoted, as I recall, a number of professionals in the field, who have been offering really constructive suggestions to government for a number of years; one of those happened to be Mr. F.L.C. Reed. I want members to know that I have discussed the issue of reforestation with him. I had a meeting of about an hour and a half, perhaps two hours, at the faculty of forestry on the campus at UBC, and there were two others as well. His suggestion all along was that if you can reach the sum of about S300 million annually for reforestation.... He felt that that would be certainly adequate. We haven't reached that yet, and that's not a surprise to any members in the House. But I'd like to point out that government, I think, has come a considerable distance.

Under the forest stand management fund, to which the members opposite referred during debate, a statement was made that, well, the federal government has pushed in $300 million. But I think that was a bit of baiting. I think it's known to everyone that it's divided equally between the province and the federal government. It's interesting to note that it was the province that put the $300 million on the table to start with, for the purposes of having the federal government participate. As we all know, the most senior level of government in Canada has not in the past really made any significant contribution to reforestation. There has been some money passed over to the government. but it was not really that significant. It seems to me that this was a very good step.

The amount of money which is going into reforestation now is well over $200 million. According to the figures which I have, it's something in the order of $219 million; that does not include the proposal for the forest stand management fund. If that fund, as set out, is fully funded, then we will be certainly approaching the $300 million level, and, of course, that is our objective.

The first member for Vancouver East (Mr. Macdonald) made some reference — and so did the other members opposite — to: "Well, how are you really going to fund it? Shouldn't that all be in place to start with?" I have to advise you, Mr. Speaker, that there was not any question about the interest of the industry, and there certainly wasn't any doubt about the interest of the leader of the IWA, with respect to this fund. But the caution that everybody advanced was: "Make sure your bill is in place and discuss with us how the funding is going to be secured." They wanted to know in advance. I think that's good counsel, before any form of assessment is made, and as you know the assessment by the provincial government can easily be done by looking to stumpage. On the 60 million cubic metre annual cut it's very easy to calculate how you would generate $20 million. But what I think they're concerned about is: "If we are going to pay that assessment, what we really want to know is where that money is going to be applied or used."

One of the obvious objectives in the fund was to look at the intensive reforestation area for tending, thinning and weeding, clearing of brush, etc. This is really something that most people have been interested in.

Mr. Chairman, I would conclude my comments.

MS. SANFORD: You didn't answer my questions.

[ Page 8330 ]

HON. MR. HEINRICH: On spray? I recognize that.

I would move second reading.

[11:45]

Motion approved unanimously on a division.

Bill 6, Forest Stand Management Fund Act, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 7, Mr. Speaker.

ASSESSMENT AMENDMENT ACT, 1986

HON. MR. CURTIS: Mr. Speaker, I move second reading of Bill 7, Assessment Amendment Act, 1986. Members have had some time to review this — it was one of the budget day bills. I would like, however, to just briefly sketch out the main thrusts of the bill, without interfering with committee stage debate.

The bill is designed to further simplify the question of property taxation, in this context by providing for special rules to determine the value of industrial property, restructuring the taxation of private forest land in a way which encourages reforestation on that land, simplifying the assessment of pipeline, railroad and transmission rights-of-way, and clarifying the definition of the property tax base.

Mr. Speaker, I would like to assure the House that it does not change the government's basic property tax policy, that of assessment of property at its market value. The use of market value assessment provides an equitable basis for the assessment of over 97 percent of the properties in the province of British Columbia, including residences and commercial holdings. In these cases, both the owners and the assessors, we believe, share a good understanding of property value as a result of regular sales of such property.

However, there are clearly some types of property that do not trade regularly in the marketplace. These, as members know, include large industrial complexes, private forest land and some types of utility property, particularly property associated with pipelines, electrical transmission lines, telecommunications cables and railroads. These properties pose very special assessment problems.

The most significant problems have occurred in respect to industrial complexes, and these problems, which are both difficult and very detailed, have resulted in a large number of assessment appeals over the past several years. These appeals have in some instances created uncertainty with respect to municipal budgeting, and have also in several instances meant that municipalities have had to refund substantial amounts of previously paid property tax to the property owner or owners. This degree of uncertainty regarding the municipal tax base is not acceptable to the government of British Columbia. Bill 7 therefore provides a framework for resolution. In regulations pursuant to the bill, when it is given royal assent, specific methods of valuing industrial property will be outlined.

In order to facilitate the development of these methods, I intend shortly to appoint an expert committee to advise on the best procedures to use when valuing such properties. I invite members to offer names of individuals they believe might be suitable to serve on such an expert committee or committees.

These new procedures should improve the equity of assessment across the industrial sector and make the municipal tax base more stable.

The second type of property which obviously does not regularly trade in the marketplace is private forest land. Once again, the valuation of this property can present very unique problems. The primary component of the value of private forest land is the value of the trees on it. As these trees mature, their value and the associated tax burden increases each year, and eventually the taxes exceed, even at relatively low annual rates, the value of the timber harvested. This, we have noted, discourages the reforestation and proper management of that private forest property. In British Columbia the problem has been dealt with previously by permitting property which is properly managed to be classified as a private tree-farm and assessed on the basis of the present value of the future anticipated harvest. However, these arrangements have proven complex to administer, have not always been entirely fair to both parties concerned and have often failed to provide sufficient incentive for reforestation. So this bill proposes new property tax arrangements which are simpler and provide a greater incentive to reforest than do the existing policies or arrangements. Private forest land, upon royal assent to this bill, will be assessed on the basis of the value of the land without trees, plus the value of the trees cut in a given year. Property so assessed will then be classified according to whether it is managed or unmanaged. Managed forest property will be taxed at low rates approximating those applied to farms in the traditional sense, while unmanaged property will be taxed at higher rates.

I believe that these new arrangements simplify the existing tax and offer a greater incentive to practise reforestation on that privately held forest land.

I indicated at the outset that Bill 7 also contains measures to simplify the assessment of some types of utility property: property such as pipelines, transmission wires and railroads extending over long distances within a narrow corridor. These properties that consist of both a continuous structure and related rights-of-way again do not often trade in the open market, and the land in question often has no alternative use. Consequently, for many years railroad tracks, pipelines, transmission cables and associated poles and towers of a telegraph company have been assessed at their average value per unit of distance, rather than at the market value contained on each legal parcel through which they pass. However, the rights-of-way for these structures have continued to be taxed on the basis of an estimate of the actual value of individual parcels. Now this is cumbersome and unnecessarily complex, and I don't think any of us really want to see a utility company receive scores or, indeed, hundreds of individual folio notices dealing with assessment, as has been the case. The bill intends to replace that system by a rate per unit of distance to be used for both the continuous structure and the rights-of-way of pipeline, telephone, telegraph, electrical transmission, trolley coach and railroad corporations.

In addition to these changes to valuation methods, the bill also clarifies the property tax base by amending the definitions of both land and improvements. The changes made to these definitions make it clear that both mineral deposits and process machinery and equipment are not subject to local and provincial property taxation. Although these are well understood provincial policies — they've been in place for a good while — the lack of clarity in the existing legislation has led

[ Page 8331 ]

to some uncertainty regarding future judicial interpretation of the existing definitions.

In conclusion, Bill 7 first provides for the simplification of the most complex areas of property assessment, thereby reducing administrative costs both for the taxpayer and for government and its emanations. It encourages reforestation on private forest land, and it provides a more stable tax base for local governments — more stable and more predictable.

As I said at the outset, I move second reading of Bill 7.

[12:00]

MR. WILLIAMS: I suppose in a general sense one would have to argue that most of the changes are long overdue and that, when you took particularly at privately held fee-simple forest lands, we have not really moved into the modern era in either assessing them in a satisfactory manner or encouraging reforestation and silvicultural activities. If you look at legislation down the west coast, as I've done in the past, in terms of taxation law and requirements with respect to management of private forest lands, they've really been ahead of us for about 25 years. This is a long lag, and it's long overdue.

It's very clear that the privately held forest lands, by and large, are the most productive in terms of their potential for timber management. We're generally talking about valley bottoms and lower parts of hillsides and the best soils in the province. So these are areas where we should be encouraging good forest management. They are also the areas that are closest to plant, so they're the most valuable in terms of their productivity in an overall economic sense because of the short distance to market as well.

But as I say, the Americans in Washington, Oregon and California have been ahead of us for about 25 years in this area, so it's very belated in catching up to a tradition that's existed on this west coast for a long time. When one says that, then it poses the question about how you really do that properly, and I suggest to the minister and the Minister of Forests (Hon. Mr. Heinrich), who might be responsible for some of the related activities, that there is a desperate need for a system of available expertise to private landholders in this province. We should almost have the equivalent in every regional college of British Columbia of an extension service available to private forest land holders so they could be advised what the best management plan would be for their lands. We would all benefit as a result of that modest level of service. It's a crying need in British Columbia to have fundamental, simple training of private landholders in forest management. There will be a genuine wealth-creation out of that kind of modest technical training available to landowners, farmers and untrained forest people in the province.

We're encouraged that this is finally coming about, but clearly the second step is advising the private sector, small citizens, on how they might best manage their lands. That would be a most worthwhile ancillary step.

I must say, and generally I think the opposition would agree, with respect to the simplification and modifications of most of the other sectors, that they're basically productive and generally move in a progressive sense in terms of the property tax. An exception, however, would be the business of allowing people that are on extremely valuable land to have it appraised at residential levels. Now I know the 10-year reach-back provision would mean you would avoid the worst abuses in terms of some new speculator jumping in, picking up a piece of property near downtown Vancouver and saying: "Well. there's a house on it, and here I am sitting." At the same time, there may be cases of extremely valuable sites that should have some levy on them because of their incredibly high value. It is true that if it's an elderly person and it's an onerous burden in terms of their immediate cash flow problems or immediate real dollar incomes, then the legislation is understandable. At the same time, if it were an extremely valuable site, it would seem only reasonable that this could become a potential clouding of title to be collected only at a later stage when the property was transferred, or when there was a death or something like that. It needn't be onerous in the short term with respect to the occupant and in terms of their traditional lifestyle.

At some point it means that the Crown or the province has forgone a lot of income that might really legitimately be called public income from the property tax through those intervening years. In the case of extremely valuable sites, it would seem to me that the reasonable thing would be to cloud title to some extent in terms of a payback arrangement at the time of sale or at the time of a death or that sort of thing.

It needn't interfere with the lifestyle of the elderly person. I would assume the intent was mainly dealing with elderly people that have been on a site for a long time and don't want to change their location. So I think that there's a potential for some abuse in that section — that the Crown might reasonably have got those revenues.

By and large, Mr. Speaker, the opposition is encouraged by the basic thrust of the bill. It finally moves us into the potential of forest management of privately held lands, which we essentially haven't had in the modern era in British Columbia.

MR. DAVIS: Mr. Speaker, I agree with much of the bill. I certainly agree with a number of its objectives — clarification, streamlining, bringing our tax law more in line with tax law in other provinces other jurisdictions. There are one or two areas where I have some concern. I simply raise my concern in order to hopefully elicit some comment from the minister.

I'm glad to see that machinery and equipment, progressively, is being relieved of property taxation, because it doesn't attract property tax in most other provinces. There's the nature of the tax, however, as it will be applied to industry. The minister said that 97 percent, at least a very high proportion of all properties in the province, henceforth will be taxed on a current assessment value, current market value. He is, of course, including all residential properties and, I believe, many commercial properties.

This bill does not provide for taxation of, I'll loosely call it, industrial properties on a market value basis, on a current assessment basis. Instead, it takes the original cost of the acquisition of the property, be it land or a combination of land and buildings and machinery and equipment, as the base and applies formulas; there'll be a handbook for the tax authorities to use. They will go to the more certain number — that is, original cost — and then apply a rate of depreciation which they find in the handbook, and this is the assessed value for purposes of taxation of the industrial property.

Industry — I'm speaking very generally — will be dealt with in a very different way from residential and most other properties; it will be essentially on an original cost basis. What I would like to know from the minister is whether the

[ Page 8332 ]

intention is to use original cost and depreciate it, or replacement cost, which, of course, is a figure that would vary over time with inflation and so on.

The first point I want to make is that industry is being treated differently. It's obvious that a municipality with a large pulp mill in its area would much prefer some definite formula, like original cost plus a book rate of depreciation, to apply. That would give the municipality a predictable tax base as far as that industry is concerned — Powell River, the pulp mill there, for example.

Industry, on the other hand, would much prefer a tax regime which is related much more to profitability — current profitability, current market value. The government, the municipalities, as I've said, prefer predictability. Industries in difficult times certainly would prefer a market evaluation of the property. What's the current value of a pulp mill today, as opposed to the current value of a pulp mill four or five years ago, when the industry was much more profitable? Obviously the market value is less today than it was then. The tax yield, following the market approach, would be much less, obviously embarrassing some municipalities, the tax base of which is largely that of industry, or indeed a single industry.

Industry today at least, in a depression or a period of recession, would prefer a market test of assessment. I suppose that in a boom when they're making a lot of money, they would be faced with much higher taxation, and perhaps would have a different point of view. But if we're to proceed along these lines, I think industry would be happier with original cost depreciated than with replacement value, which would give it the worst of all worlds, because replacement of a plant today, certainly in the case of a pulp mill losing money, is far in excess of any capital investment the firm would be prepared to make today. So my question essentially is: is it original cost depreciated or not?

I can certainly agree that regulated utilities, or even monopolies — certainly those whose income is related to their investment in a formula way — should be taxed in this fashion. There's no doubt that pipelines and powerlines — that kind of thing — should be taxed on the original investment depreciated. It's a regulated rate of return that they get on their investment; their taxes should be determined in a similar fashion.

If I can identify a case which has been brought to my attention, however, of industry's investment, the coal off-loading facilities near Prince Rupert are virtually identical to the new coal off-loading facilities at Roberts Bank, down near Vancouver. One handles a fraction of the volume of coal that the other does. The one in Prince Rupert is, by current volumes, uneconomic; the one near Vancouver, handling at least two and a half times the volume of coal — it has a better system of charges and so on — by contrast is quite profitable. Yet the basis of assessment, as I understand it, under this new bill would see the two facilities being assessed at the same value. So despite their different economics, their different profitability, they will pay a comparable rate of tax.

That's industry's case, really: give some relief to industries in difficulties. I don't know how that could be administered, especially in the case of numerous smaller firms, some whose fortunes are being improved and others whose are in decline. I suppose it would present an incredible challenge to the assessors to assess the current business prospects — an assumed market value which varied from time to time, in the case of those properties.

I'm really raising a question, the kind of question which has been addressed to me by different people in industry. I suppose my own question boils down to: is it replacement cost or is it original cost depreciated in the case of industry? Certainly predictability indicates that industry, with varying prospects over time, be treated differently from residential properties, which have greater continuity in value, and some commercial properties. There is a concern there, in the industry community, about this new way of taxing. I'm sure they would be much happier to be taxed on original cost than replacement cost.

[Mr. Ree in the chair.]

MR. D'ARCY: In general, I think this is a good act. There are two points that I want to make to the minister. He has heard me make them before, but I'm going to make them again. One is the question of a relatively small exemption on the value of improvements to property, to recreational land. I'd leave the question of recreational land open to the minister and the government, through regulation, and the question of an individual decision out there to the assessors and the courts of revision.

[12:15]

There are a number of my constituents who have improvements on recreational land that are very simplistic, very rustic: in some cases, only a pup trailer up on blocks; in some cases, a very crude cabin. When I raised this point with the minister and his commission, when they were travelling the province in the fall of 1984, he agreed — or I thought he agreed — that this was in the area of a nuisance tax, and the kind of tax he wished to get rid of.

I'm not suggesting any relief, Mr. Speaker, on the land taxation for recreational property; nor am I suggesting any reduction in frontage taxes. I would submit that for the individual who has a $100,000 retirement home which he wants to describe as recreational, an exemption of $10,000 on that $100,00 is not going to do him much good. He would still pay 100 percent taxes on the land and 90 percent on the improvements. But once again, recreational improvements, particularly in the interior, are often usable for only five or six months of the year in any event. Many people, especially senior citizens or those on low incomes, find this a nuisance tax. Taxes on minor improvements, particularly if they're on leased or rented land, are very annoying and, I would suggest to the House, cost the government every bit as much to assess, appraise and collect as they're worth to general revenue. I would like the minister to consider this change through regulation or some other amendment.

My second point, and I suppose far more important to my constituents, again is an issue which I've been raising in this chamber for years: that is, the question of fair property taxation for generating facilities owned by British Columbia Hydro. We note that even in the act there is a definition of improvements, including aqueducts, dams and reservoirs. I want to remind the House that unlike B.C. Rail and B.C. Ferries, whose property tax exemptions are at least equal when they have them, B.C. Hydro in fact has a three-stage system of taxation on its property. It pays full taxation on some generating facilities, mostly those near the coast and the major population centres; essentially those which B.C. Hydro inherited from the B.C. Electric Company. Other facilities built by B.C. Hydro but not part of the two-river policy of the 1960s pay part taxes.

[ Page 8333 ]

Projects which are directly part of that two-river policy from the 1960s have complete exemptions by order-in-council. I state very strongly to the House that this is totally unfair, particularly since most of those two-river generating facilities are in the south-eastern part of the province or in the Peace River. In fact this is a subsidy that the people of the southeast, the west Kootenay, the Columbia area and the Peace River pay to the rest of the province. I really feel that if Hydro facilities in all of the generating stations in the Fraser Valley, or in tributaries of the Fraser River, the generating stations in the Bridge River-Lillooet area, the Squamish-Cheakamus area...that were those all exempt, I believe a change would have been made years ago; but because these facilities are in the Peace or in the west Kootenay, this inequity goes on. All I ask is that there be an equal taxation policy for installations of B.C. Hydro, where an assessed dollar is an assessed dollar, whether it's on the Columbia River or the Alouette.

Those are the two points I would like the minister to consider. One is the nuisance tax on minor improvements on recreational land; the other, a fair taxation policy on improvements owned by B.C. Hydro and Power Authority.

HON. MR. CURTIS: I heard the second member for Vancouver East (Mr. Williams) point out that some of the U.S. west coast states have been ahead of us in terms of the way in which tax is levied on privately owned forest land. Without being flippant, I would simply say, better late than not to do it at all. That was the essence of his summation with regard to that portion of the amending act. In that we're dealing with a specific bill amending the Assessment Act, I will undertake to consult with the Minister of Forests on ways in which we can further assist. It moves out of my area of jurisdiction and into the Ministry of Forests with respect to the assisting of owners of fee-simple forest land.

The member for North Vancouver–Seymour (Mr. Davis) has assisted me greatly over time in terms of this very complex question of assessments. I can tell the House that on more than one occasion at the start of a calendar year, or a budget year, I have said to officials in my ministry: "Look, this year I don't want to amend the Assessment Act. I'll do anything, but I don't want to amend the Assessment Act." Yet there is one every year. I think that alone speaks for the fact that it is a complex act. We cannot satisfy every point of view — not that I have been asked to — but indeed it is a constantly changing, evolving area and one becoming more complex, with more individuals and more firms and more of those trained in the law attacking individual parts of the Assessment Act for a variety of reasons. That is fair enough. That is the way things operate in a democratic state. But we see parts of the Assessment Act constantly under attack.

That leads then to the response the member for North Vancouver-Seymour (Hon. Mr. Davis) spoke of regarding the industrial complexes. Mr. Speaker, we have had in this province, without any exaggeration, careful, well-considered, detailed valuations of industrial properties with a variation of $300 million. You can argue on both sides of the question. It's worth X or it's worth X plus $300 million or X minus $300 million; the variation is incredible. We know of specific instances. I am sorry the hon. member for Mackenzie (Mr. Lockstead) is not here today or at least is not in the House, because we have just undertaken an assistance package for the district of Powell River. With, first, an appeal to the Assessment Appeal Board on the industrial complex — I am speaking to the bill — and then an appeal to the court and after a considerable time lag, there was a surprise for the district of Powell River, a very nasty surprise in terms of money which it has to refund to the owner-firm of that particular industrial property. The government could not turn its back on that particular circumstance and has undertaken assistance through the mechanism of a loan to the municipality which is to be repaid over a given number of years.

I did indicate on the question of industrial properties that I invite members who are interested and who care to do so to offer — because following royal assent we will develop regulations — their thoughts specifically in terms of further aspects of attempting to reach fairness and equity in the assessment of those very complex properties. I think that as many members as there are in this chamber would have views to the same quantity as to what is fair and what is not fair.

The member for North Vancouver–Seymour also spoke about introducing the question of profitability into the assessing for property tax purposes of those large complexes. Well, Mr. Speaker, I am not sure that I could agree to that. Some years ago, this government or a previous government — it matters not; the fact is that it is in place — responded to another sector of commerce in British Columbia asking that the profitability be built into the computation of their assessed values, leading then through the property tax equation to the amount they have to pay. That was a response to representations made, and it was done. It was done quite some time ago. Individuals in the same commercial activity, and it is a large one, are now saying: "Look, that isn't fair. That is prying. That is asking for information which is not properly yours in the property-tax context." We have had to politely remind them that they asked for it. They asked for it on more than one occasion, and they were given that right. Now they don't like it, and that's fair enough. But government earlier responded to that specific request.

We need the kind of special expert group to attempt and to achieve the very best evaluation on property tax, the assessment portion of industrial property. Mr. Speaker, many courts of revision — and this is not a criticism of them at all — when faced with the first appeal regarding a large industrial complex say, "We pass," in effect. "We pass over to the Assessment Appeal Board." Assessment appeal boards, in spite of the fact that we have members of the boards who are trained in the law and in real estate valuation, real estate appraisal and so on, also have difficulty. Understandably they have difficulty with the value of this complex at a particular point in 1986 or 1987. So we are attempting through this not to concur with those who propose the profitability factor or the balance sheet factor, but rather to have the ability to really focus on the current value of that particular industrial complex — that pulp mill or whatever it might be. The Assessment Authority continues to work with representatives of industry — I'm speaking here of very large industry — to improve ways in which fairness and equity can be achieved. They do not always agree, and therefore they do not always succeed; but that process will continue. I think it will continue in better fashion with the passage and royal assent of Bill 7.

The member for Rossland-Trail (Mr. D'Arcy) never misses an opportunity to speak about a tax on B.C. Hydro properties. I hear him, and I'm sure he will speak on that in the context of my estimates when they're presented to the Committee of Supply. That is not in the bill, therefore I cannot respond to it. But I know he will speak about that with conviction on another day.

[ Page 8334 ]

With respect to the exemption of the so-called nuisance tax on a portion of improvements of residential/recreational land, I would refer him to section 9 — perhaps in committee. The bill does not do that which he has advocated and that which he spoke about in 1984 at the hearings. The member will know that I accepted many recommendations, but could not accept all of them. I agree there is an element of nuisance. However, section 9 at least recognizes another problem, which I don't think has been identified in the House, and that is that we are specifying that the addition of newly leased Crown land to the assessment roll after its completion need not occur in rural areas. This is being done because there is no mechanism to levy taxes for a partial year in rural areas, and consequently the addition of property partway though a year results in a full year's taxes being charged. This is clearly and eminently unfair. So we have that amendment in section 9, and I would think that that will provide assistance to some of the owners of recreational/residential property about which he has spoken. It doesn't go all the way, but that is one step that we have taken.

I'm sure that members will want to deal with this section by section and point by point in committee, and I therefore move second reading of Bill 7.

Motion approved.

Bill 7, Assessment Amendment Act, 1986, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. VEITCH: Second reading of Bill 8, Mr. Speaker.

[12:30]

INCOME TAX AMENDMENT ACT, 1986

HON. MR. CURTIS: I move second reading of Bill 8, the Income Tax Amendment Act, 1986. This is another bill which flows from the 1986-87 budget. It is designed to implement a measure which completes the major reform of provincial taxation of business in the province that began with the 1985 budget and followed the 1984 taxation tour and study.

Last year, as the House will recall, property tax, corporation capital tax, fuel tax and social service tax issues were addressed. In the same spirit, this bill reduces the provincial income tax rate for larger corporations from 16 percent to 15 percent effective January 1, 1987, and to 14 percent effective January 1, 1988.

Now the measure primarily affects those corporations with more than $200,000 annual taxable income. It's important to note that smaller businesses continue to be taxed at a very significantly reduced rate of 8 percent. Only two other provinces have lower rates for small business income. However, at 16 percent the British Columbia corporate income tax rate for larger corporations is equal to the highest in Canada. By 1988, the rate in B.C. will be lower than the current rate prevailing in seven other provinces.

British Columbia's high rate has been criticized for two key reasons. It first of all is clearly an impediment to attracting investment to British Columbia, since the same investments in some other provinces would result in lower tax liabilities when the investments become profitable.

Secondly, it's considered to be a penalty on those companies successful enough to earn substantial profits, especially small or medium-sized businesses which grow into what would be categorized as a large corporation. The reduction of the rate to 14 percent will address both of these justifiable criticisms. The timing of the reduction is expected to fit well with the return to taxable status of those British Columbia companies which are now benefiting from the economic renewal program, the measures of 1985, the 1985 budget. In 1988-89 it's estimated that about $64 million in relief will be provided to business in British Columbia through the passage of this bill. This will clearly apply added stimulus to the economy and will generate new investment and increased economic activity.

I indicated that it is yet another step in terms of bringing our tax regime in B.C., to the extent that we are able, to the extent that we have the authority regarding the tax structure in this province, into a more equitable position. It was put together and is clearly presented to this House in order to make British Columbia more competitive in a very competitive world.

As I did earlier, I again move second reading of Bill 8.

MR. COCKE: I see what the minister is doing. My problem is, of course, that I wish that the whole question of taxation was done in an even-handed manner. I put this in juxtaposition with the "medical tax bill" that we had two or three years ago, which was an 8 percent surcharge. It really had nothing to do with medicare. As a matter of fact, in that bill the government in an unprecedented manner allowed themselves by order-in-council to increase taxation on ordinary people. Fortuitously, in this bill there is no allowance for order-in-council reduction or increase or whatever.

The minister says that he listened during his tour and during the study of taxation. I recognize that he did. I have been a bit resentful about the fact that cabinet ministers in this government, as opposed to moving a resolution in the House empowering a committee of both sides to listen to presentations — utilizing in the best possible way, as they do in virtually every other jurisdiction in the British Commonwealth, the standing committees of the House — ignore that system. Nobody knows better than the minister himself, who was on a standing committee of this House between 1972 and 1975 — and if he could speak without bias, I'm sure he would indicate that much of the work that that committee did was certainly in the best interests of the province.... I wish that this government and these ministers would have.... I guess I may as well say it in the past tense now, because they're not too long for this world as far as this government is concerned. It's not too likely that they're going to bring in very many more budgets or much more legislation. They're going to be long gone as a government.

Mr. Speaker, the minister talks about us now being, at 16 percent, equal to the highest in Canada; and then we go down to one of the lowest, at 14 percent. That, of course, is over a two-year period. I wish that I had the confidence that he has in this whole question of renewal. His timing says that it goes along with renewal, but I have seen very little evidence of significant renewal. We have some artificial stimulation going on at the present time, but I wonder about renewal. I worry about what happens in the north when new negotiations occur over coal.

I worry about what happens to our major industry when we have a Prime Minister who is not protecting our interests

[ Page 8335 ]

out here. And if that goes for cedar, I don't see why it won't go for other areas in that industry. When I see that situation looming over the head of renewal, it worries me.

MS. SANFORD: I worry about agriculture. Do you worry about it?

MR. COCKE: The member for Comox worries about agriculture. I'll tell you right now that in the face of "free" trade I worry about agriculture too. You know, Reagan has stuff that he wants to put on the table, and I want us to remember in this House today that he who has proclaimed long and loud that he was all for a clean slate going into those talks was the deciding vote on that tariff on cedar.

AN HON. MEMBER: Clean launch, single table.

MR. COCKE: Clean launch. Everything was lovely until Reagan either spit in the eye of Mulroney or Mulroney is a willing accessory to this situation. Either way, it is very difficult.

MS. SANFORD: Prime Minister Mulreagan.

DEPUTY SPEAKER: Order, please. We are on Bill 8. The Chair is having some difficulty....

MR. COCKE: Yes, Mr. Speaker, we're talking about Bill 8 in view of the minister's discussion of Bill 8. Bill 8, I understand, comes into effect in time to come into effect with renewal. I say that because of the fact that the minister forecasts a 28.5 percent increase in corporate income tax revenue despite his rate cut. So if we are going to have a cut in tax and at the same time secure an increase in the amount of tax, then it strikes me that something out there must be happening.

When the minister gets up and talks about renewal in the House, I wish he would be more definitive. It may be that in his statement to close debate he can be a bit more definitive as to where we can anticipate renewal, where we can anticipate an improvement in our economy; so far, Mr. Speaker, it hasn't been too rosy a picture that I've seen painted. I wish this province good luck, but I guess the best luck that could occur would be a change of government, because we've got a failure government to date.

Interjection.

MR. COCKE: The member for Omineca (Hon. Mr. Kempf) indicates that I'm jumping ship. I'm doing, after some 17 years, what the Premier (Hon. Mr. Bennett) is doing after some 13 years. I for one wasn't on the Titanic; I believe that he believed he was.

Anyway, Mr. Speaker, I hope the minister will get up and tell us all about how he sees this renewal. I recognize that he says this will attract business. The decrease in tax will get the old motor going — free enterprise, the motor of the economy. To date I haven't seen private enterprise carrying their end of the load. The government has carried the load. Out of one side of their mouth this government says that private enterprise is the engine of the economy, but the only way they can get the economy going is with government megaprojects.

[12:45]

Interjection.

MR. COCKE: Certainly. That was just a majestic experiment. We hope it works.

There has not been a great migration of entrepreneurs into British Columbia with bucks to provide us with any kind of hope. The Louisiana-Pacific. of course, was attracted here, and so would anybody else be attracted here with $20 million of government money.

Interjection.

MR. COCKE: Twenty-five million. It gets better every day.

Mr. Speaker, one of the things I want to do, though, is just place this bill in juxtaposition with the ordinary people in this province who have packed the load. The ordinary people in this province are taxed and taxed again. The minister talks about how we are low in terms of our taxation, always conveniently forgetting about our surtax, which is a permanent surtax unless it's legislated out of existence. But that 8 percent surtax is permanent, and it does give us a significant jump in terms of tax.

Many people found that out this year for the first time when they did their B.C. tax, over and above their federal tax. Yet at the same time as or just after we raise tax on ordinary people, we reduce taxes to corporations. We're not reducing taxes to the smaller corporations as much as we are to those that are earning significant profits. So, Mr. Speaker, I feel that it's an unfortunate situation that we're placed in this position.

Mr Speaker, I was interested today that the tax bills were called. The tax bills were called on a day when the Whip of the government side had been notified that our finance critic would not be here, was unable to be here. Therefore, Mr. Speaker, I move adjournment of this debate until the next sitting of the House.

Motion approved.

Hon. Mr. Nielsen moved adjournment of the House.

Motion approved.

The House adjourned at 12:48 p.m.