[ Page 4511 ]

CONTENTS

Routine Proceedings

Law Reform Amendment Act, 1988 (Bill 27). Hon. B.R. Smith

Introduction and first reading –– 4511

Oral Questions

BCIT. Mr. Jones –– 4512

Sale of government vehicles. Mr. Clark –– 4512

ARDSA grant for Bevo Farms. Mr. Rose –– 4512

B.C. savings bond issue. Mr. Davidson –– 4513

Mr. Williams

Committee of Supply: Ministry of Economic Development estimates.

(Hon. Mrs. McCarthy)

On vote 19: minister's office –– 4514

Mr. Williams

Mr. S.D. Smith

Mr. Rose

Mr. Michael

Mr. Miller

Mr. Clark

Mrs. Boone

The House met at 2:07 p.m.

HON. MR. VEITCH: I want to inform the hon. leaders of the opposition that I'm prepared to answer all questions because I have with me my mentor, the Hon. James Chabot. I think there's already a division, Mr. Speaker.

HON. MR. SAVAGE: It gives me great pleasure to rise in this assembly today and introduce the president of the B.C. Fruit Growers Association, Mr. Gerald Green, from the great constituency of Okanagan South. Would this assembly please make him welcome.

MR. ROSE: On behalf of the New Democratic Party, I would like to welcome our constituency assistants who are here meeting in Victoria on their annual visit, probably trying to brief one another on ways to make us look as good as they can. I'd like the House to welcome them all.

MR. PELTON: On behalf of the second member for Dewdney (Mr. Jacobsen) and myself, I would like to take this opportunity to introduce to the House today 30 fine young students from Meadowridge independent school in Maple Ridge. They are here with their teacher, Mr. Hume, and they cover grades 7 through 10. I would ask the House to please make them very welcome.

MR. GUNO: First of all, I'd like to draw to the attention of the House that there is a desk without a blotter beside me. This has happened overnight.

At any rate, I'm pleased today to acknowledge the presence of four distinguished visitors from Atlin. We have Mr. Rod Robinson, who is the executive director of the Nishga Tribal Council. Along with him are Mr. Nelson Leason, who is chief of the Laklazap band, Harry Nyce, a staff member, and also a representative on the Kitimat Stikene district, Collier Azak. Would the House bid them welcome.

HON. MR. REID: Would the House make a special welcome today for Mrs. S. Martin, a teacher from Sunnyside Elementary School in sunny south Surrey. She has with her 45 grade 5 and grade 6 students here in the precincts today. Would the House make these people especially welcome.

While I have the floor, I would like to recognize the former Provincial Secretary, in relation to the Yellowhead Highway, and I wear this rose in recognition that here today is the member closest to the Yellowhead Highway connecting British Columbia and the Queen Charlotte Islands.

MR. BLENCOE: Our side of the House would also like to welcome Jim Chabot back to the Legislature. We all recall many verbal jousting battles we had with that former member, and we also recall the many times in question period when we tried to get the right answers. We still have questions, Mr. Former Minister. Perhaps you would take the front bench today. On behalf of our side of the House, it is really nice to see Jim Chabot here today.

MR. LOENEN: Two introductions. Accompanying my wife in the member's gallery are two members from my constituency and personal friends — people we have known since our teens and who have worked in our campaign. I would just like to ask the House to join me in welcoming Hans and Sylvia Verhoef.

Secondly, a group of students from Richmond: approximately 60 grade 7 students are visiting us today from the Walter Lee Elementary School, together with their teacher Mr. Welton. Please make them welcome.

MRS. GRAN: Visiting the House today and later appearing before the Select Standing Committee on Standing Orders, Private Bills and Members' Services are representatives of the Life Bible College of Canada from Burnaby. They are Robert Buzza, Morag MacLeod and Debra Pope. Would the House please welcome them.

MR. LONG: Today in the precincts we have a teacher, Mrs. Teresa Gomm and 14 grade 7 students from the Assumption elementary school in Powell River. I would like this House to make them welcome.

MR. BARNES: I'm sorry I wasn't in when former Provincial Secretary Mr. Jim Chabot was being introduced. I just can't miss the opportunity to welcome him back and to tell him that he would be very proud to know that the present Provincial Secretary (Hon. Mr. Veitch), the Minister of Tourism (Hon. Mr. Reid) and all the rest of those guys over there are carrying on in the same tradition that he did; that we still are waiting for a policy on multiculturalism, and I'm sure it will come sooner or later.

HON. B. R. SMITH: Before having the honour to present a message, I cannot resist welcoming the old master skater back to his ice. Boitano and Orser have no equal to this individual. No one could pilot a bill through this chamber, or introduce a bill, with more consummate skill than James Chabot.

Introduction of Bills

LAW REFORM AMENDMENT ACT, 1988

Hon. B.R. Smith presented a message from His Honour the Lieutenant-Governor: a bill intituled Law Reform Amendment Act, 1988.

HON. B.R. SMITH: Mr. Speaker, this is one of the Law Reform Commission recommendations that we are acting on. It contains provisions that will guide the courts when determining the domicile of dependency of a minor. It will repeal obsolete sections for remedies against the estate of a deceased debtor, obsolete rules of law that have been around since 1920, and will abolish the common law action dating from medieval England that a servant has against a master.

[2:15]

The major change in here is an amendment to the Law Property Act, which limits personal liability under a mortgage. This is an amendment that we have talked about in our caucus and in this chamber in the last parliament. This will clarify the law with respect to the extent of personal liability under a mortgage or an agreement for sale. Under these changes, where the original borrower has sold his home and the purchaser has assumed the mortgage, the original borrower's liability will be extinguished unless the lender demands payment in full within six months after the term of

[ Page 4512 ]

the mortgage has expired. So the original borrower will be able to extend his liability by having the lender approve the creditworthiness of a purchaser or proposed purchaser.

These amendments represent a significant improvement over existing laws, where we had situations where original homeowners, believing they'd sold their home, several owners intervening, and then there was a default and the lending company went back on the original borrower and tried to hit him on the covenant. So this amendment, I think, will be very well received.

Bill 27 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Oral Questions

BCIT

MR. JONES: Mr. Speaker, I have a question regarding BCIT for the Minister of Advanced Education and Job Training. Last month, without warning, the minister demanded a $4 million cutback, threatening over 60 positions at that institution. Now the minister has suddenly reversed himself on funding and has given BCIT a new mandate, which we on this side of the House applaud. However, I would like to ask the minister: can he explain what prompted his sudden reversal in policy?

HON. S. HAGEN: I do appreciate the question, because today I announced a new mandate for the B.C. Institute of Technology. Effective in 1989-90, the institute will become the centre for advanced training in the province. The cuts were really imposed as a reflection of four reports that had been done at BCIT which said that BCIT was becoming more and more like a community college. Therefore I had said to BCIT that they would be brought under the college funding formula, because so many of their programs were the same as ones offered in the colleges.

Upon reflection on that, however, and after more consideration of the reports — particularly the Park report, where they suggested that there should be the establishment of a centre for advanced technology training....  Even though they said they did not recommend that it should be at BCIT, I determined that BCIT was the proper place for that facility. Therefore I was able to announce today that not only was the funding that was cut from the budget to be reinstated, but an additional 2 percent in funding, less the $326,000 identified by their administration that could be cut from the administration of the institute, was to be added to that reinstatement.

MR. JONES: I think that response indicates the ad hoc nature of the minister's planning process. Can the minister assure this House that this plan is a concrete example of the government's commitment to a more comprehensive planning process, so that post-secondary institutions like BCIT can get off the emotional roller-coaster in terms of their future?

HON. S. HAGEN: I can assure the hon. member from the other side that not only is this a statement of confidence in the institute, but it's the desire of the government to build on what is at the institute. I had a meeting prior to the announcement this morning with the board chairman and also the chairman of the finance committee. I had a telephone conversation with the president of the institution as well as with the president of the faculty association. I can tell you that they were very pleased; they were very supportive. I've had numerous conversations with those gentlemen over the last three weeks. They were very appreciative of the announcement, and they are ready to get on with the job.

SALE OF GOVERNMENT VEHICLES

MR. CLARK: A question to the Provincial Secretary — a simple one. Is the government's vehicle fleet or part of the vehicle fleet up for sale?

HON. MR. VEITCH: Well, anything can happen in the fullness of time, hon. member. But right at the present time we have no intention to sell any of these vehicles, unless they become redundant to our needs, and then if you'd like to buy a used clunker, we might have one available for you.

MR. CLARK: Could the minister inform the House why your assistant deputy minister, Mr. Jerry Woytack, and Mr. Lorrie Adam, director of vehicle management, met with Mr. Weiler, the vehicle lease manager for Jim Pattison, on Monday last?

HON. MR. VEITCH: No, I don't know why my assistant deputy minister met with a lease manager, other than to tell you that we do lease vehicles, as well as purchase them. We lease many vehicles. I'll find out, and if it's significant I'll certainly report back to the House.

MR. CLARK: Supplementary. Mr. Speaker, on Tuesday last week Mr. Weiler appeared at the vehicle branch in Burnaby and told people he was putting forward a proposal to take over all of the vehicles in British Columbia. We've had no public announcement, no mention of privatization, no public tender; yet your ministry is meeting privately with Mr. Pattison's company. The whole thing reeks yet again of another preferential treatment for friends of the government. Will you undertake now to bring forward the evidence and information that you have no intention of privatizing this branch of government, so that the minds of the people who work there are put at ease?

HON. MR. VEITCH: We lease vehicles from a whole bunch of companies. We lease vehicles from Jim Pattison, from Carters, from people here in Victoria, and we buy vehicles all over the province. We buy hundreds and hundreds of vehicles all over the province. I see nothing improper in the assistant deputy minister who is responsible for these vehicles meeting with a car dealer. I think that would be the appropriate person for him to meet with. I'll have a look at the whole thing, and if it's significant, we'll get back. I think you're reading too much into this.

ARDSA GRANT FOR BEVO FARMS

MR. ROSE: I have given notice of a question to the Minister of Agriculture, and it arises out of some questions I put yesterday. The ARDSA grant to Bevo Farms is part of a $2.5 million package that includes $250,000 for land acquisition. Has the minister now reviewed this application as he promised to yesterday? Does the application make it plain

[ Page 4513 ]

that the $500,000 grant was part of a larger package, and that one of the spinoffs of this package was the transfer of land worth $60,000 or so from Western Lettuce to Bevo for about $250,000?

HON. MR. SAVAGE: I have checked the ARDSA application form and gone through it in detail. The accusation yesterday was that perhaps the $250,000 of that $500,000 grant was designated for land purchase. Let me assure the member opposite that is not the case, and that the application met the guidelines in the greenhouse construction machinery application for the one-third funding allowed under the ARDSA agreement.

As to whether the land issue was part of the grant consideration, no, it was not. Does that answer your question?

MR. ROSE: Would the minister care to admit that two companies with the same president and the same board of directors could — under the $2.5 million application — transfer on paper the sale of a piece of property at $250,000 between two existing companies that are identical except for their names — land that was worth about $60,000?

HON. MR. SAVAGE: To answer the question, I suppose they could. But in fact, by the numbers I have looked at, that is not the case.

MR. ROSE: Perhaps the minister is looking at the wrong numbers.

I would like to have a final supplementary. Bevo Farms president Jack Benne — no relation to the comedian — is also the president of Western Lettuce Now. The present payment appears to be the third one — the ARDSA grant of $500,000 — that this company, Western Lettuce Now, has got in a very short time. The public accounts show $4,900 and some odd in the fiscal year '86-87, another grant in March '87 for $40,000, and now comes the one for $500,000.

Given the Premier's well-known opposition to grants to business, I wonder if the minister is satisfied, after looking it over, that these applications are all for different things.

HON. MR. SAVAGE: Yes, I am satisfied. The grant application forms, as they come in under ARDSA, are scrutinized and gone over very thoroughly by engineering, by my staff and the advisory board. This particular grant was to set up our first real commercial seedling greenhouse in the province. This particular operation will provide somewhere between four and five million vegetable and flower seeds for our greenhouse operators within the province. It's an initial seedling greenhouse, one that I think we should be encouraging.

MR. ROSE: I wonder if the minister could tell the House whether or not he was aware of the two other grants and what they were for?

HON. MR. SAVAGE: I was told by my staff that there were other grants, but not given the details of them.

B.C. SAVINGS BOND ISSUE

MR. DAVIDSON: My question is to the Minister of Finance. In view of the rather negative report carried in one of the local papers about the B.C. bond issue, and in view of the rather glowing report carried in the national press, could the minister throw some light on the rather confused state of the poor British Columbian reader?

HON. MR. COUVELIER: I take it the hon. member didn't wish me to get into a discussion about the relative merits of the level of reporting from both national and local papers. I assume the issue we're discussing is the B.C. savings bond matter?

MR. DAVIDSON: That's the one.

HON. MR. COUVELIER: I'm delighted to advise the House that the B.C. savings bond issue is meeting our objectives. I would remind the House that when we decided to go to a retail offering, the effect of that decision was to target the issue to the small B.C. investor. The small B.C. investor is taking advantage of the good interest rate and the good investment possibilities inherent in the offering. As a consequence of that, based on very cursory reports after one day of sale, the issue looks like it is going very well. It might be admitted that some salesmen might be more accustomed to answering the phone rather than making calls. By virtue of the fact that we are spending taxpayers' money, I expect them to earn their commissions, and as a consequence, they are expected to make the calls.

When we set the rate, we canvassed the market and completed an examination of about 12 houses in terms of setting the interest rate. It was the consensus of those 12 houses that an 8.75 percent interest rate was competitive and was a good investment for the small investor, who was the investor we were targeting. I'm pleased to advise the member in the House that we have a very successful issue on our hands.

MR. DAVIDSON: Could the minister possibly answer how these similar facts could be reported so differently in two news media?

HON. MR. COUVELIER: That's a challenging question, Mr. Speaker. I'm not sure that I can do it justice in the time remaining, but I am willing to try.

Given the fact that there are obviously other important questions, I will attempt to have a private discussion with the hon. member on that very important question that deserves serious examination.

[2:30]

MR. WILLIAMS: With respect to the bond offering, would the Minister of Finance confirm that the offering was prepared through Guaranty Trust — the initial work there — and that Peter Hebb, a well-known right-wing supporter of your party, was the main person involved in this process that doesn't look like it is going to be as successful as the minister suggests?

HON. MR. COUVELIER: I don't quite know if there's a question there. But let me just tell the hon. member that it is, of course, true that people who have an understanding of the governmental process and the financial community coincidentally happen to be basically supporters of the Social Credit government, and I make no apology for that. If these people, in their wisdom and experience, decide that they choose to support one party over another, then of course that's their choice.

[ Page 4514 ]

Dealing with the particular question, in which I gather was the implication that this government is somehow rewarding its friends, let me just tell the hon. members that there are a variety of investment houses involved in this issue. Pemberton is the lead agency, and I'm not aware of any particular interest being expressed by myself or my staff in terms of political affiliation. Our interest and our sole purpose here is to serve the taxpayers of this province properly. By this issue and at 8 ¾ per cent, we are providing effective management of the public dollar.

Orders of the Day

HON. MR. STRACHAN: Before calling Committee of Supply, Mr. Speaker, I have a couple of requests. First of all, I would ask leave of the House to allow the Select Standing Committee on Standing Orders, Private Bills and Members' Services to meet today while the House is sitting, at 2:45 p. m. The matter is the business of the Life Bible College Act.

Leave granted.

HON. MR. STRACHAN: Also, I'd like to advise the House that pursuant to standing order 2(2), the Legislative Assembly will sit tomorrow.

Committee of Supply, Mr. Speaker.

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

ESTIMATES: MINISTRY OF
ECONOMIC DEVELOPMENT

(continued)

On vote 19: minister's office, $277,394.

HON. MRS. McCARTHY: Mr. Chairman, yesterday — and reference was made to it again this morning — the hon. member for Vancouver East asked some questions regarding Riverview Heights–Westwood Plateau sales under the B.C. Enterprise Corporation. In a further question, he asked about Molpar Construction Ltd. and the agreement with BCEC in that regard.

At this time I want to respond to that question by telling the hon. member through you, Mr. Chairman, that all existing sales at Riverview and Westwood were a result of proposal processes carried out by the Ministry of Forests and Lands. That was in 1985 and 1986. The B.C. Enterprise Corporation files, for which I have responsibility, start with the agreements with the successful proponents. In other words, we do not have the background information, because at that time we inherited the successful proponents.

So I cannot provide the information that was asked of me for two reasons. First, I do not have it. Second — and Mr. Chairman, you will be apprised of this — this kind of information which dates back to those dates has no reference to the estimates of this minister and, more importantly, has no reference to the time-frame in which these estimates are being debated.

In addition — because at the present moment the question vis-à-vis Molnar Construction has been given to me — I want to tell you that this agreement does date from 1985; however, it has been an active file and is ongoing, as you know. The total price of that agreement is $20,565,000 paid as the property is drawn down for development — that was the agreement. As you remember, in 1985 it was a very different marketplace from today's.

To date, $12,214,088 has been paid. The balance is to be paid no later than July 3, 1990 or sooner if the property is drawn down sooner, with that determination. You have to know, too, that in this agreement, just as the other one that I answered through a question period question from the same hon. member, the developer in this case is taking raw land, providing all expenses for development and bearing all the costs and risks related to developing and marketing the land.

MR. WILLIAMS: The minister is saying that there are absolutely no costs being borne by government or BCEC with respect to any expenditures whatsoever on servicing on all of the 140-acre site?

HON. MRS. McCARTHY: Mr. Chairman, I believe that to be true. In the next five minutes, I can get that answered, but I'm quite sure it is true. All development, servicing and marketing costs are borne by the development corporation.

MR. WILLIAMS: When you know, let us know, for sure. It's not....

Let's understand who was the player here initially. Who was the Deputy Minister of Lands when this deal was initiated? The minister knows. The deputy minister was Robert Flitton, replaced by the former Premier, Bill Bennett, after firing an outstanding professional who was the Deputy Minister of Lands, Mr. Johnson. Mr. Flitton has been an active, card-carrying member of the Social Credit Party through most of his career. Mr. Flitton was a vice-president of the Social Credit Party in Kamloops. Mr. Flitton was active on the executive of the Social Credit Party in Prince George. Mr. Flitton....

HON. MRS. McCARTHY: A point of order, Mr. Chairman. For a whole range of reasons, the member's statements are very much out of order. First of all, he is obviously beginning one of his personal attacks on a citizen of the province, in this chamber where he has immunity. Secondly, he is reflecting on a time in the ministry of Lands and Forests. . . . These estimates are for the Ministry of Economic Development. He is also reflecting on a time-frame which has nothing to do with either my ministry or the timeframe of which we are reflecting on the estimates of the Ministry of Economic Development. I would ask you to ask the hon. member to keep his remarks in order.

MR. CHAIRMAN: The minister makes some reasonably valid points, and I know the hon. first member for Vancouver East is well aware of the requirements for the debate on estimates. I would ask him to continue in that manner.

MR. WILLIAMS: We will make equally valid responses, Mr. Chairman.

[Mr. Rabbitt in the chair.]

That's interesting. This deal is still being delivered by this minister through this Crown corporation. Let's understand that. This deal, hatched by Mr. Flitton, who was a Socred hack and then made deputy minister, one of the first hacks to be made deputy minister. . . . That has not changed; there

[ Page 4515 ]

have been more since. But this was one of the most clear-cut cases of patronage and a Social Credit hack becoming the deputy. You are still administering what that hack delivered to Mr. Molnar.

The interesting question, Madam Minister, is this. Have you checked the file? Have you checked to see who the lawyer was for Mr. Molnar? Who was the lawyer that hatched this sweet deal? Who was the lawyer that bargained with Mr. Flitton?

HON. MRS. McCARTHY: Mr. Chairman, again may I just make the point. The hon. member is asking a question about a business deal and a government negotiation that took place before my time. I have no idea who the legal counsel would have been, and I have no idea who did the negotiation at the time that the minister of lands and forests had jurisdiction over this negotiation. I'm sorry.

Again I tell you this member is totally out of order. We are simply in the matter of the B.C. Enterprise Corporation, which in this past year took on the responsibilities of B.C. Place lands and the B.C. Development Corporation, and in those responsibilities it was in several agreements, and we have become the collecting agent under the agreement made prior to that time in which the B.C. Enterprise Corporation was formed. In order to assist the hon. member, I have brought to the House the original terms, i.e. the amount that the government was expected to get.

Again, in his questioning he is reflecting on another ministry, but also in a time-frame that is not conducive to the debate in this House today. I ask you, Mr. Chairman, to please ask the hon. member to remain in order so that we can have some constructive debate on the Ministry of Economic Development.

MR. WILLIAMS: I can understand why the minister is all of a sudden so fastidious and cautious, because I wouldn't want to be tied in with this particular deal either if I were you. Check the files, Madam Minister. Check the files and find out who the lawyer is that pulled this deal together. You know who you'll find. You'll find one Peter S. Hyndman as the lawyer that pulled this deal together. Most of us remember Mr. Hyndman — he too of the lavish tastes and spending. He's been able to carry on with those lavish tastes and spending as a result of being the solicitor for this deal. Your $20 million deal was pulled together by Mr. Hyndman. through your proposal call; and proposal calls — let's get it clear — can be much looser than clear bid arrangements.

HON. MRS. McCARTHY: On a point of order, Mr. Chairman, it's unfortunate that the hon. member cannot act within the rules of this House. Once again, to ask me about a negotiation and to try, through phrasing his question in such a way that he demeans the names of people in this province and reflects on their reputation...is totally out of order in this House. I would ask you to bring this member.... For the third time, I ask your cooperation.

[2:45]

It was before my time in this ministry. This ministry had no responsibility for that particular Forests and Lands transaction, and it is not up to this minister to be accountable in the estimates for 1988, because I have no memory of it. He had to tell me who the legal counsel was. I had a totally different portfolio at the time. The hon. member had to tell me who the deputy minister was at the time. I had no knowledge of that until you brought it to the floor of this House. For me to answer those questions in any way, to bring any light upon any of the questions you are asking, is impossible.

Mr. Chairman, once again I ask you to bring this hon. member to order.

MR. CHAIRMAN: Madam Minister, the point is well taken. The first member for Vancouver East is fully aware of the rules, and I would ask him to phrase his questions in such a way that they fall within those rules.

MR. WILLIAMS: They do indeed. It's an interesting piece of land we're talking about here, and the minister is responsible. The land is being sold through the Enterprise Corporation: the deals that Mr. Hyndman hatched with Mr. Flitton are continuing. That deal is ongoing, and you are currently responsible for it, Madam Minister. I don't blame you for trying to isolate yourself from it, but you're tied; you're part of the package over there. You might fight currently with Mr. Toigo and all the rest of it, but you're part of the package over there.

You look at the subdivision of those lands: beautiful slopes above Riverview, from the Lougheed Highway to the top of the hill, pulled out from the old Riverview Hospital lands; 25 different sales, many of which you have been participant to in the past year through your responsibility. But the players have done extremely well out of this exercise. It's kind of relevant, particularly when we reflect on the Expo deal as well, to see how well a person can do when he makes a deal for a big package of land: then he can break it up into the pieces. They do incredibly well.

The point is that it's the same kind of deal. You don't put up the $20 million up front; that's down the road. That's a pretty nice deal. Meanwhile, you don't have an interest clock ticking away, do you? Li Ka-shing doesn't have an interest clock clicking, and Andre Molnar doesn't have an interest clock clicking. Anybody in the private sector who goes out buying land has an interest clock to watch, and he must pay interest on the balance that has not been paid. Was any interest paid by Mr. Molnar on the balance? Is it being paid on the balance, or is it a deal like Li Ka-shing's?

HON. MRS. McCARTHY: As I mentioned earlier, in this particular transaction they cannot, until they add value to the land, realize any profit whatsoever, so there is an investment by the firm. The hon. member says, "Oh " and shrugs his shoulders in his typical way. It's so true, though. He wants to ignore that investment. It's as if we've given land over or we continue to give land over, as is the case he's trying to make, without any commitment at all from those who purchase it.

I have told you the figures. We already have in the Riverview Heights agreement, which dates back to 1985, the total price which was paid for the property of $20,565,000, but to date the $12,214,088 has been paid because of the drawdown of the lot.

So in 1985 — and we all have to acknowledge that 1985 and 1986 was the slow-moving time — that agreement was a substantial agreement to make, and a very good one to make at that time in our real estate marketplace. But there's a protection also that the balance must be paid by July 3, 1990, two years from now; and if it is drawn down sooner, it will all be paid up sooner. It's an agreement in which the developer only makes money if he develops the land and puts in the

[ Page 4516 ]

services. Under those terms of the agreement, the taxpayer who owned the land only wins.

To say it any other way is to say that the province, in this particular case, should have been in the development business — should have put in all the services and then put all the lots up for sale. Again, I ask you to reflect on the time that this transaction was taken, which was in a real estate marketplace where that would not have been the best solution at the time. Again, we're just reflecting on what would have been the state of the marketplace and the decision at that time.

We are the collector under the agreement. It is being drawn down and is being collected on behalf of the people of British Columbia in a very orderly and very good way, and I'm pleased that it is working well.

MR. S.D. SMITH: I have some questions that I would like to address to the minister in relation to some issues that were raised this morning, particularly in relation to the free trade agreement and some of the benefits that will be accruing from that agreement to the interior of British Columbia, particularly in the areas of value-added.

I was listening to the discussion this morning, Mr. Chairman, with a lot of interest. There were, quite properly, a number of requests for more information about, I suppose, a kind of cost-benefit analysis, if you like, sector by sector of the free trade agreement.

There was reference made to the area of graphic art and there was reference made to the publishing business, for instance, that I was sensitive to. This whole business, Madam Minister, is very important to the people in the interior. The free trade agreement, of course, is our great opportunity for diversification of the economy and the shoring up of some of the sectors that we're into in a kind of embryonic way because we get some markets. But I'm very much concerned about the way information is being disseminated on this very important matter, both from ourselves and from Canada.

Recently in our constituency we had a mailer, a householder, go out from a democratic socialist — or socialist anyway — a Member of Parliament, who said that there would be 600 jobs lost in the area as a result of the free trade agreement; and he went through those 600 jobs and listed them sector by sector. What twigged me to it was the first member for Vancouver East (Mr. Williams), who today was on to the same train of thought, presumably using the same erroneous research information.

When we analyzed the 600 jobs that were going to be lost, we found that 90 of them were alleged to be in something called "publishing only." Of course, we decided to go through the community to find out how many publishing only jobs there were in Kamloops, and it turned out that in fact there are none in Kamloops; no jobs "publishing only."

There was another sector of combined publishing and printing; likewise we found that there were very few of those. We found as well that in some of the areas, for instance on the petrochemical side where it was alleged that we were going to lose these jobs in the Kamloops area, there weren't any.

We too, like the first member for Vancouver East — who now has scampered out of the chamber — want that kind of information. These kinds of deceits that are being peddled by the democratic socialists in instruments like their mailers are very hurtful to the community, which ought to be getting honest information and honest presentations from their public officials, who will take this important issue, look at it sector by sector and see where the opportunities lie and where the problems will arise.

Madam Minister, in our area we have, fortunately, the Lottery Corporation headquarters and, associated with that....

Interjection.

MR. S.D. SMITH: There are some guffaws coming from the members of the official opposition, presumably laughing at the fact that the interior of the province is getting the opportunity from the technology transfer associated with the Lottery Corporation.

Associated with that, we have a high tech printing facility that has incorporated into North America Japanese technology that is being used here for the first time. As a result of the free trade agreement, the tariffs on that lottery technology and the associated printing technology will be coming down to zero in the first year of the agreement. That, of course, poses an enormous opportunity for us to pursue the sale of lottery materials into the United States, which is one of the big growth industries — some would say unfortunately — in the U.S., with tremendous billions of dollars involved. Of course, on the printing side the graphic arts are where the greatest amount of job intensity is in the whole industry.

I'm wondering, because the opposition was concerned about graphic arts this morning and because their socialist member of parliament has sent out this deceitful piece of information to the community . . . . He has not corrected it, even though he sent out another mailer and even though we had a free trade opportunities forum in Kamloops in March at which he was invited to participate and discuss these issues. I'm wondering if the minister can answer a couple of questions.

One, will she be able to provide for the community information to correct the erroneous information coming from the socialists in terms of the publishing and printing sector in British Columbia?

Secondly, is there anything on the agenda that she could share with us that may be undertaken in relation to pursuing the opportunity presented to us as a result of the tariffs on lottery and lottery-related technologies going down to zero in the first year of that agreement?

HON. MRS. McCARTHY: Mr. Chairman, I'd like to thank the hon. member for his question.

On the whole area of printing and publishing — printed paper and publishing material going into the U. S. — the U.S. tariffs on those goods will be eliminated within five years. Broadly, those people who really have got excellence in those trades in our province, let alone in our nation . . . . We probably have in our province the most creative people in the whole of this nation in the graphic arts area. They should be totally benefited.

In terms of the printing of lottery supplies etc. in British Columbia, it has been stated by the vice-president and general manager of Pollard Banknote (B.C.) Ltd. that if a free trade agreement is announced, it would give a tremendous and almost immediate boost to that company, to the extent of his identification of about 100 more jobs in British Columbia. They are now completely precluded from selling into the U.S. They will have the ability, and it would open another opportunity.

[3:00]

[ Page 4517 ]

It's unfortunate that the opposition members, in their off the-record remarks in the House when the mention of lotteries is concerned, and the plant for the printing of lottery tickets, supplies etc., which go all over British Columbia and Canada from British Columbia . . . . It's unfortunate that they haven't recognized that that is an excellent business for Kamloops and has indeed been a very good industry for the Kamloops area. There's no question that the region has benefited from the jobs created.

In my response to your remarks, I can say that it is one of the sectors that should. . .and because of the excellence in that industry, not just the banknote industry, which has started through the Lottery Corporation here, but because of the centres of excellence we have in the graphic arts and publishing fields in this province . . . .

MR. WILLIAMS: It is typical.

MR. S.D. SMITH: The first member for Vancouver East (Mr. Williams) is, as usual, moving himself towards unstuckness.

MR. WILLIAMS: I'll deal with you, Charlie, in a minute.

MR. S.D. SMITH: I'm sure you will. Maybe you and I can get into the area of child abuse one of these days, when you deal with me. I think that would be an appropriate discussion.

MR. CHAIRMAN: I would ask the member to direct his remarks to the Chair.

MR. S.D. SMITH: In any event, we in Kamloops are looking forward to the opportunity to pursue the printing side of the lottery business, and I know that there was some sneering and carrying on going on over here a moment ago on what the lottery business produces. Since that printing facility has come as a result of using our purchasing power, we are now printing those tickets in Kamloops and selling them to Spain and Malaysia. We have also had on probably a monthly basis now people from lottery corporations around the world seeking to benefit from the technology we have developed here in British Columbia. Of course, as you know, there was a tremendously successful convention of these people in Vancouver.

The concern I have is that we can be certain and confident in that area, that the Ministry of Economic Development will be able to pursue areas such as the ones involving the GTECH organization that is looking for the opportunity to build, assemble and manufacture and sell machinery, and looking at opportunities in relationship to the sale of technology — the technology of managing and operating a lottery corporation — as well as the benefits of straight printing of lottery materials into. the United States. It's one area where we have developed excellence in British Columbia by a decision taken to move that facility from Winnipeg to Kamloops to benefit the people here, where there is a growth potential of tremendous size in the U.S., as 24 states have now moved to lotteries individually, and I take it that most of them will be over the next number of months.

I am wondering if the minister could give us and the people of Kamloops some assurance that she will pursue this opportunity with some vigour, given that the Lottery Corporation is indeed mandated through the province itself.

MR. CHAIRMAN: Madam Minister, before I recognize you, I would like to remind all members that personal allusions in debate are contrary to the long-established traditions of this House and that tradition has been established in order to keep a smooth flow of debate and keep proper decorum within the House. Madam Minister, would you proceed.

HON. MRS. McCARTHY: I know that that was intended for all members of the House, opposition as well as government side.

The hon. member for Kamloops is. of course, interested in ensuring that the viability and long-term benefits that have accrued to the Kamloops region because of that plant will be not only retained but enhanced in the years to come. There is no question in the mind of the vice-president of that organization — who has made public comment on that — that it will, but through a free trade agreement, it definitely will.

I should remind the members in the House, because it's very important to this province, that the entry of all areas of business into the United States will be free and unhindered in regard to doing business, supplying services and so on. It's of particular interest in businesses such as the hon. member for Kamloops mentioned, but if you wish to relate to some of the businesses in the service sector — consulting engineering work and architectural work of which this province has probably . . . . There really isn't any equal to those in our province in those kinds of professional services. So it will be a big gain for us. I can certainly assure the member that to sell into the United States of America in that way will be a great enhancement to the economy of this province.

MR. WILLIAMS: I'd like to read into the record, Mr. Chairman, what the Americans are saying about the printing industry and what the Mulroney trade deal will do to benefit them. Instead of just all this nice positive stuff from the minister, let's hear how the Americans view this specific sector themselves. This is the vice-president of Printing Industries of America appearing before the United States House Ways and Means Committee, Mr. Benjamin Y. Cooper, who is the senior vice-president for government affairs of PIA. He said it "...provides an enormous opportunity for the U.S. printing industry. While no one can predict the eventual gains from removal of tariff barriers, it is our estimation" — of his industry, and that's after analysis — "that an additional $500 million of business could be realized by U.S. printers through the removal of Canadian tariffs." That is the American industry speaking before the Congress of the United States. This was presented February 29, 1988, and published in Print Lines, their journal, in April, 1988 — that is, just last month, He expects that they will probably realize $500 million annually as a result of the trade deal.

We, in turn, have a Canadian association. The Canadian association independently prepared an estimate, and their estimate of the losses for their industry in Canada was minus $500 million (Canadian). The Americans think theirs will be plus $500 million (U.S.).

The conclusion that the Canadian printing industry comes to in their submission to the federal government last year is as follows: "There is no doubt in the mind of the Canadian Printing Industries Association that the government of Canada will conclude a free trade agreement. . .with the United States. Equally, we have no doubt that the results of this pact will be primarily negative within

[ Page 4518 ]

the domestic printing and allied industries." Those are the people most affected on each side of the border coming independently to their own conclusions, and they both conclude that Canada will be the loser out of the trade agreement that Mr. Mulroney has signed and which you support. So that is abundantly clear.

If we really reflect on it, the fact is that in Canada most of our significant printing industries are trade union organized. That is not the case in the United States. We have an average of 40 percent trade unionization across the board, higher in the printing industry in this province. That's not at all the case in the United States.

In addition, if a printer in British Columbia were to go into the business and buy new machinery, he'd pay the 6 percent sales tax on machinery. With a new major multicolour printer, it would cost you $1 million right now in British Columbia, and you'd pay $60,000 in sales tax on that, which you wouldn't in Washington State, right across the border.

You can do all the Pollyanna stuff you like, but the people that know this particular industry best have the facts, and the facts belie what you and the member for Kamloops say.

Insofar as the Coquitlam lands are concerned, I can understand the minister not wanting to get into this discussion. However, she indicated she would carry out some checks and that within five minutes she'd know regarding the servicing questions. Maybe she could advise us.

HON. MRS. McCARTHY: Just to speak to the printing question which the hon. member brought up, the U.S.A. specialties have not traditionally been our specialties in printing. They are not equal. They are not the same. I think that we will find niches in their market just like they plan to and have already found niches in our marketplace. A lot of American goods do come over with the tariffs at the present time, but the printing industry will emerge, I think, more capable in the long run. The hon. member and I disagree on that.

You asked a question earlier regarding the property, and I believe the project is called River Heights, with Molnar Construction Ltd. There are no costs whatsoever to B.C. Enterprise Corporation. There are no costs to the government for servicing, marketing or anything else, absolutely, as I mentioned earlier and as I thought earlier. There are no costs borne by the government or the taxpayers on that property.

MR. WILLIAMS: Insofar as those costs are concerned, can the minister confirm that the Enterprise Corporation paid the development charges with respect to that subdivision? That's a charge to the municipality which is an overall charge per lot prior to development. In the case of these lands, I think it was about $1,000 a parcel.

HON. MRS. McCARTHY: There is no way I could know that. Again, I go back to my assessment that this is the kind of question that is out of order, because all of that was done prior to my responsibilities and is not involved in this year's estimates. If it were, it would be under a different minister entirely, as this came under Lands and Forests at the time.

MR. WILLIAMS: The minister has reported on the contract which she is responsible for carrying out. Can the minister advise what down payment was received by the Crown?

[3:15]

HON. MRS. McCARTHY: That goes back to another era; I cannot answer.

MR. CHAIRMAN: I'd like to point out at this time, Madam Minister, that I'm not that familiar with the dates of these things to know what is in order. I will call upon you for assistance — and also on you, hon. member.

MR. WILLIAMS: The minister has now established there is no interest being paid whatsoever by this developer. Is that correct?

HON. MRS. McCARTHY: Would you please repeat the question?

MR. WILLIAMS: I'm sorry. The minister confirms that there is no interest being paid by the developer with respect to the lands he is still to acquire here.

HON. MRS. McCARTHY: I think I can confirm that. I believe that's the way the structure of that transaction was formed. When the property is sold and drawn down, then the dollars accrue to the government.

MR. WILLIAMS: Exactly. Unlike most transactions, there is no interest being paid on the balance, and there's a commitment to deliver the land. But in every other case in the private sector, you would have to pay interest while you were preparing and anticipating with respect to the development of the rest of the lands you are going to get. In that sense, it's an extraordinary situation. This is a significant benefit that accrues to the developer and his partners that does not normally accrue to anybody else in normal market transactions in these areas.

HON. MRS. McCARTHY: The only response I have to that is to go back to the time that agreement was made. There wasn't a marketplace for that property at that time. It was a slow marketplace at the time, but I'm told that the principal figure — the $20 million figure that I mentioned earlier — was grossed up to compensate for interest, so it was a compensation for that. In the meantime, as the lots are being drawn down, there is a large investment again by the private sector — the Molnar construction company — on that property. In that respect, the principal figure included a projection for interest.

MR. WILLIAMS: If you look at the pattern of sales here as recently as November '87 — for example, plan 77299, some 30 lots — the cost per lot was $20,400. There have been some sales since then, and they are running at the $70,000 level. It's a very significant difference. If you check on the purchase made on October 26, 1987, the cost per lot was $30,600, and the sales in January were at the $66,650 level — a very significant difference. It far exceeds any cost of servicing.

If you check another sale purchased September 16, 1987, the cost per lot — that's plan 75755 — was $34,000. The sale — which is not an arm's length one to the Park Lane Ventures — was at $52,000 per lot. If you check the sales again on August 18, 1987, the sale was at $34,000 per lot, and the average price was something like $64,000 for ten of those

[ Page 4519 ]

parcels — an increase of some 88 percent. In each case, it's a very significant difference that far exceeds any likely cost of servicing. There was, in fact, not an interest clock ticking despite the minister saying that there were some negotiations there around the question of forgone interest in the overall price.

It's very clear that this has been an incredibly beneficial arrangement for Mr. Molnar, and there's no question that his solicitor, Mr. Hyndman, negotiated a very good deal. Can the minister comment on the margins of return on those various sales?

HON. MRS. McCARTHY: Mr. Chairman, again we're talking oranges and apples; the hon. member is very good at that. We went through this same debate in question period. He asked me to get the background for the same figures he's presenting today. I did, and I showed in my answer at that time that when the developer, no matter what his name is.... If there are any aspersions being cast on one of the very best developers and designers that this province has ever known.... Andre Molnar is definitely one of the best in this province and has developed some of the most attractive subdivisions, townhouses and condominiums in this province. So I'm hoping that the hon. member is not casting any aspersions on the honourable citizen who has created many jobs for this province. I think he can attest to that as well, because he knows a little bit about the marketplace in the lower mainland.

The comments you are making reflect on the price of raw land and then the selling price. You forget to tell the House, and are trying to create the impression, that along the way all one does is purchase the land from the government and then do a quick flip without any costs whatsoever — all profit to the developer, to the lucky person who is able to get that land. You know that's erroneous. We both know that is very definitely not what Molnar Construction and the developer of this property had to live through. In 1985, when there was a very different marketplace, they had to find money for the development, and development is a very costly investment.

Within the price of each lot that you quote today is a price paid out by Molnar Construction to bring that separate lot to the marketplace. They don't do it just lot by lot, as you know: they have to do it in a large strip. They may sell the first part, then they may have to hold on to the investment interest on that, and on it goes. You know that full well, but again, as I explained in question period.... I explained all of this to the hon. member, Mr. Chairman, because I really felt that he wanted to know the answer. You were given the answer at that time.

You know full well that the development business is such that if they gain, no matter what price they purchase the property at . . . . If you want you can argue with the past Minister of Lands and Forests, or the past Deputy Minister of Lands and Forests, or past governments, which is not part of this discussion today. But I've got to tell you, it doesn't matter what price was paid for the land. The investment over that time puts his net at a very different level than you're trying to place in the minds of the people and on the floor of the House today, and it's unfair.

There was an alderman in Coquitlam who said at the time you did it before that it was grossly unfair. Ald. White said: "These people" — meaning you and referring to your public comments in this House — "should know better. They're attacking people who are trying to create new development and new jobs in our area and in our community."  He finished by saying: "These are the kinds of people who should know better." Mr. Chairman, I can't say it better than he did. The hon. member for Vancouver East should know better, and it's unfair to leave that implication with this House and with the people of British Columbia.

[Mr. Pelton in the chair.]

MR. WILLIAMS: The minister also indicated that she was going to advise the House what the other bids were with respect to the Westwood lands, and we have not had that information today.

HON. MRS. McCARTHY: Mr. Chairman, I opened the debate today with a statement which was very clear. I shall, if you like, repeat it. I said that that information is not within my ability to give, because the information requested took place before my time, in a different era. When I responded to your question yesterday, I thought you were asking a question that was within my responsibility for B.C. Enterprise Corporation as well as responsibility for the estimates of this year. The question asked was on neither of the criteria. Frankly, I don't have the information. We've been through this debate several times this afternoon.

Going back to Molnar Construction, I would like to tell you that the municipal development costs were paid entirely by the developer. The proposal call was advertised at the time, and 17 proposals were received. The Molnar company was, I am told, the best of all those received. So it seems that 17 proposals had an interest; the Molnar group was of the most interest. Again, the development costs you asked about were very definitely paid by the developer.

MR. WILLIAMS: The minister, in various debates over the past several weeks, has advised the House that there was indeed a bidding process with respect to the Westwood lands; and she indicated yesterday that she would provide the House with the data on who those bidders were, by some designation , and what the amounts were that they offered. Now we're being advised that it's information she's not privy to. Is that so?

HON. MRS. McCARTHY: Mr. Chairman, I'm glad the hon. member sees the light. It's true: I don't have it. We took on the agreement in that particular area. We manage the agreement; we collect the funds. All past transactions were done in another ministry and are not within the estimates of this House at this time — nor this ministry even.

MR. WILLIAMS: But why, Mr. Chairman, would the minister tell us that there was indeed a bidding process, and that there were several bidders? Now she tells us she can't give us the information. It doesn't fit.

HON. MRS. McCARTHY: Mr. Chairman, there are people within the ministry who recall some of the past developments, and are giving me the information vis-à-vis municipal development costs. I have been told that a proposal call was advertised, and someone remembers that there were a total of 17 proposals in the particular area you're focusing on. I could not, however, have any opportunity of finding that out through my responsibilities at the present time, through BCEC — it's not there.

[ Page 4520 ]

MR. WILLIAMS: But we are dealing with what the minister has said, Mr. Chairman, and the minister confirmed in this House that there was indeed a bidding process with respect to the Westwood lands. She's been talking about the Riverview Heights lands, but there's been no evidence....

Interjection.

MR. WILLIAMS: Oh, you're withdrawing that, are you?

HON. MRS. McCARTHY: No, I'm saying....

MR. CHAIRMAN: Hon. member, just before we proceed, I might mention at this time that the Chair, of course, is not privy to what the minister might have said at any other time. But I would like to interject to remind hon. members that there are two things that I think are really important. First of all, we all know that there is no compulsion for the minister to answer any of the questions put to her; and secondly, there is certainly no requirement that any questions be answered which apply to a period during which the minister was not in control of the particular ministry. I believe I heard the minister saying that. However, it's up to you, Madam Minister, if you'd like to answer the last question.

[3:30]

HON. MRS. McCARTHY: Mr. Chairman, I'm grateful for your attempt to keep order. I just wish to explain to the hon. member who asked the last question that in the note that was sent to me — just to be assured and to give you the proper information vis-à-vis the development costs. . . . Whoever has written the note, and hasn't signed it, says that the proposal call vis-à-vis the Riverview Heights agreement apparently received some 17 proposals, and Molnar was the best in that particular proposal call. Other than that, I cannot give you any further information whatsoever, because it does not come under my ministry — never did. We are simply administering the transaction, which was started by a previous minister and ministry, and in a previous time outside the time-frame for our estimates.

MR. WILLIAMS: The problem I have, Mr. Chairman, is that the minister has said that there were these many players involved, and with respect to the other lands at Westwood....

Interjection.

MR. WILLIAMS: Yes, you got up in question period and said that; that was the way you dealt with it at the time: it was a full bidding process. In the last month you have said it was a full bidding process. Then yesterday you said you could provide bidders A, B, C and D. Today you're saying it's outside your purview; you have no understanding whatsoever. Why on earth did you say those things previously, Madam Minister?

HON. MRS. McCARTHY: I'll refer to this transaction for the last time, as I don't think it's within my purview. I think you're totally correct, and I have suggested that it is out of order. I did my best to get the information for you. In question period you asked specifically about Riverview and Westwood, I believe. In all of the government's transactions the bidding process has always been carried out under the Forests and Lands ministry in a very businesslike and tendering manner. There's no reason why I shouldn't share that information with you. When I have it — and today I have been given just a little information — I don't mind sharing it with you. But you really are burdening the time of this House with something that's absolutely outside my purview, and I do hope that you get back to questions on the Ministry of Economic Development.

MR. WILLIAMS: Let's at least make it clear then that the minister has said in the House, with respect to the Westwood lands — you are wont to confuse the two right now — that there was a full and complete multi-bidding process. You have provided no data whatsoever to the House. I've asked you to provide the data for the House. You have said you would provide examples of bidders A, B, C, D and E. You have not done so, and it appears that you in fact cannot. The burden of proof is with you in terms of that full bidding process. You have not provided us with any evidence of a full bidding process with respect to the Westwood lands.

Interjection.

MR. WILLIAMS: The minister is asking for help from the Chairman. So be it. I think the record is now clear that the minister is indeed not able to provide us with that data, and that's significant.

To go back to the trade deal, there will be a seven-year period of negotiations with respect to harmonizing questions between Canada and the United States. "Harmonizing" is defined as making equal in terms of what we do in Canada versus what they do in the United States. In the United States, 30 percent of their people have no medical coverage; 40 percent of our people in British Columbia are in trade unions versus 15 percent there; unemployment insurance is available for a longer period of time in Canada than it is in the United States. The agreement tends to move towards what is called a level playing-field between the two countries. That means there will be pressures in Canada to decrease trade union organization, reduce unemployment insurance benefits, and so on. Does your department anticipate being involved in these discussions with respect to "harmonizing" as defined in the agreement?

HON. MRS. McCARTHY: The hon. member should understand that we have agreed to the clause on national treatment. National treatment means that in Canada we will do those things which we want to, which we have done in the past and will continue to do. He mentioned health services. It's interesting that in the trade agreement of the European Economic Community the people of Britain haven't lost any of their health services. I think he made the point yesterday that health services would be lost, and tried to raise fears, and to scream the politics of fear over social services as well. He also said what tremendous social services the Europeans have. It's interesting that they are part of the European common marketplace and haven't lost services in their countries through the trade deals.

National treatment gives us what we want nationally, what we have decided upon nationally. We will treat Canada and Canadians and those living in Canada the same as we do at the present time, and in any enhanced social services which we may have in the future.

[ Page 4521 ]

The U.S.A. will do the same with their people. The same thing will happen on that side of the border. If you take the description of harmonizing, it's not that. It's not a harmonizing in North America; it is national treatment in the U.S.A., it's national treatment in Canada.

Again, I reiterate that the giving up of any of our cultural, social and health services was not part of the deal whatsoever. This is a trade deal between the United States and Canada.

MR. WILLIAMS: I just make the point that you can't really compare this deal between Canada and the United States with the European common market. The European common market is three major players — that is, Great Britain, France and Germany — and a whole group of smaller players, who together are very significant. The Canadian-American deal is just that: it's a 10 percent, 90 percent arrangement. So harmonizing in the European common market is a very different exercise from harmonizing between Canada and the United States. The social programs in Great Britain are significant and high, relatively, but the harmonizing in the European agreement is to move towards the Scandinavian states, i.e. the higher levels of northern Europe. That's a very different arrangement.

What we're talking about is harmonizing downward in Canadian terms; I think that's the reality. Americans will argue, for example, that our fishermen on unemployment insurance are an unfair subsidy. They will then argue for harmonizing downwards and not having unemployment insurance available to our fishermen, because they perceive it as a subsidy.

We will be going through a seven-year exercise in this harmonizing game between the feds and the Americans. The problem is, we threw the major cards on the table in achieving this deal in the first place, and we will have seven years of throwing more cards on the table as we deal with these harmonizing questions. It isn't like Europe at all, unfortunately. I wish it were so, because then it would mean Americans harmonizing up to Canadian levels.

I guess what I fear and what some Canadian economists fear is that Canada will end up being the Scotland of North America. Rather than the full, free, independent nation we are now with our own policies determined by ourselves at the provincial and federal levels, we will end up, more and more, like being an appendage to the more successful part of North America. The prospect may be Canada as Scotland in North America, rather than Canada, the true strong north and free. That's a very different Canada than we've known through this past century.

HON. MRS. McCARTHY: I really want to respond to the remarks of the hon. member from Vancouver East, because he's suggesting that there will be a harmonizing down vis-à-vis the health services for those in Canada, and that Canada will get to a lower level of health services by some magical move in a trade agreement.

First of all, you have to know that one of the things that the United States is constantly doing is looking to Canada as one of the models for a universal health care system. There have already been congressional hearings on the need for the U.S. to adopt a universal health care system. Our nation is one of the countries which they are looking to as a model. So if there's going to be any harmonizing, apart from the trade deal, vis-à-vis universal health care, you can believe that it's the people of the United States who will be looking to Canada as a model and will be harmonizing upwards in their health care system. Our health care system is not up for grabs in the U.S.-Canada trade agreement.

In addition, the hon. member made some reference to the fishermen and their concerns over the loss of unemployment insurance. That has already been decided. That was decided in the east coast fish dispute in 1985. In 1985, the whole unemployment insurance concept of our fishermen on the east coast was tested. The Americans did challenge it. They challenged it, not under a free trade agreement but under their own business being done with Canada at the time, and UIC was determined to be above the current trade law. It was established by a hearing and it was established in law at that time.

Again, it is not up for grabs in this trade agreement. It is one of those issues that are not on the table for any kind of change. All of those social programs that are intact, such as health, UIC and social services, as promised, are still intact within our country and will continue to be.

MR. ROSE: I wonder if the hon. minister would mind telling the House what clause in the agreement guarantees social services such as medicare, unemployment insurance and maternity benefits.

HON. MRS. McCARTHY: In establishing what was up for debate, the Prime Minister of the country has said: "Our political sovereignty, our system of social programs, our commitment to fight regional disparities, our unique cultural identity, our special linguistic character: these are the essence of Canada. They are not at issue in these negotiations." That's a statement made by the Prime Minister in September 1985. There is no need to quote that which is not up for debate. It suits the socialists in this country to bring them into the debate because it seems to be the only thing they can make an issue out of, but it does not appear that they can at any time point to any place in the negotiations that the federal administration has undertaken on behalf of Canada. Again, it is just not within the debate on this trade deal at all.

[3:45]

MR. ROSE: I was looking here for the exact quote from the Prime Minister during the most recent election, where he got such a tremendous majority. It appears to me you're quoting the same Prime Minister who said, in effect, that anybody who enters a free trade agreement with the United States has got to be crazy. Two or three years later, because he has no other industrial strategy, we're in it. You ask me to take the assurances of the Prime Minister who told us flatly he wouldn't even touch free trade with a ten-foot pole, and that's supposed to satisfy us that there's something in the agreement that's going to protect our social programs. It is absolute and utter nonsense. There is no part of the agreement at all.

Here's what he said as a hopeful at his leadership convention in 1983:

"Don't talk to me about free trade. We'd be swamped. We have in many ways a branch-plant economy in certain important sectors. All that would happen with that kind of concept would be the boys cranking up their plants through the United States in bad times and shutting their entire branch plants in Canada. It's bad enough as it is."

SOME HON. MEMBERS: Who said that?

[ Page 4522 ]

MR. ROSE: Who said this? Well, his first name is Brian. Sometimes he's given a prefix that rhymes with Brian, but I'm too honourable to mention that in the House right now.

Mr. Chairman, that is no assurance whatsoever. I think the hon. member for Vancouver East has gone through ad nauseam the pressures that are going to result from this agreement. Let's deal with the facts. Some of the facts really concern us. Talk about integration with the United States or more investment here. According to Joe Clark, 46 percent of all the profits last year went to the United States. You want more investment to go to the United States? This is lunacy. I thought our country was not for sale. It isn't: it's going to be given away. It's just nonsense.

Why are we involved in all this? It's simply ideological. They believe in the market economy. That's what it's all about: the good old market economy. It's really been wonderful, that market economy. It's really helped a lot of people. We've got so much faith in the market economy that we've got safety nets all over the place to prevent the brutality of the market economy. That's why we've got all these things we've built for ourselves in this country that other countries envy.

What's all this business about free trade and giving up such things as the generic drug stuff and the national energy program and FIRA? We've already given away our arguments. They're gone. What did we get out of it? I would challenge the minister to stand up in this House and tell us what British Columbia industries, in the short run, are going to benefit from free trade. Where are these other jobs coming from?

HON. MRS. McCARTHY: Let me respond to the hon. member, the House Leader for the opposition. I want to just give it as quickly as possible because there are several areas where there is a mixed impact, a negative impact, a positive impact and a minimal impact.

There is no impact at all on the cultural or social services of our country. Minimal impact would probably come in transportation, construction and advertising; and negative impact in alcoholic beverages — everybody is clear on that, and we have been working in this area in terms of some kind of adjustment. There are some down sides. We have had them identified today — we identified some of them, too — in publishing, cable TV and broadcasting. Some of the problems vis-à-vis cable TV. . . . It has a potentially negative impact in those areas. We also realize and have talked about some of the impacts in fisheries and agriculture.

However, there are positive impacts in very many more areas: forestry and mining; manufacturing; electronics; enhanced telecommunications; finance; real estate and insurance; the management consulting business; all services in regard to architecture and engineering; computer and data engineering; tourism. There are very many more areas where it will have a positive effect.

When I say negative, slightly negative or having a mixed impact, let me reiterate what I said earlier today. In areas where there is an adjustment to be made, there is a period of time. On the whole agreement there's ten years; in some specifics there's 20 years. So there are adjustments that can be made in that time-frame. I think that we in Canada are up to those negotiations.

You also referred in your remarks to the Prime Minister and his remarks. I'm not here to defend the Prime Minister of Canada. I'm here to serve the people of British Columbia. In the Prime Minister's remarks addressing this free trade agreement, he very clearly stated that social programs were not on the table. Something that happened along the way in terms of putting these negotiations together — and it was the first time the provincial governments across this nation were asked to do a watching brief on this particular agreement .... We have had consistent staff people — and I would like to pay tribute to those in my ministry who have been there as a watching brief on behalf of British Columbia, who have brought back the message and who have taken our message.

Of course, through the first ministers, the Premier of our province dealing with the Prime Minister of Canada, they have been heard and we have been heard. To state that people change their minds over the years.... When the agreement was introduced for the government of Canada at that time.... It has been consistent in those negotiations all along that social services were not part of the negotiations, and they never have been.

MR. ROSE: I think we all know that these things are often not made explicit. What we're talking about is the other pressures surrounding them. The other night we were at a dinner sponsored by Crown Forests, and we met a man who said. . . .

Interjection.

MR. ROSE: Yes, we were doing a freebie. We heard you were there the week before, but they enjoyed talking to us because it was so much more interesting.

MR. MICHAEL: Not so — not me.

MR. ROSE: You weren't there.

He said he could not very much longer compete in the plastic bag division of Crown, because his competition from Tacoma was paid about $5 an hour less than he paid.

Interjection.

MR. ROSE: What's that got to do with it? We've had people band together collectively over the years in this country to protect their wages from attack. We talk about all these wonderful benefits that are going to accrue to us because we can bang our way into the United States. We'll bang our way all right — they'll take what they want and that's all. If things are so wonderful down in the United States, how come Alabama, Louisiana, Kentucky and all those other places...? They've got complete access to the U.S. market. They've got all kinds of trees down there, acres and acres of trees planted by such names as Zellerbach, MacBlo and others. They've got lots of trees down there. How come they're only paying about $2 or $3 an hour? Those are called the right-to-work states — the right to work for less. That will affect us.

We'll be contracting out, as we are already in our hospitals and other institutions. One of the biggest growth industries in the United States now — or one of the biggest in the service industry — is cleaning. Those companies will come up here. They're already up here in the institutional catering business, and there'll be lots more of them.

If you're worried about what might happen in pulp.... Let me quote that well-known foaming-at-the-mouth radical head of Noranda, Adam Zimmerman. In a recent speech he had this to say about free trade: "With respect to trade in

[ Page 4523 ]

natural resources, U.S. trade policies in the current context of protectionism will no doubt be directed more and more towards offsetting the comparative advantage...." Talk about a level playing-field! When we've got a comparative advantage like we have in woods, there'll be offsetting and protection. I'll quote him some more: "I don't believe that there is anything in the deal that would prevent the U.S. pulp industry from mounting a similar attack to that of the lumber industry."

So we went all through this exercise. First of all, it’s supposed to bring us cheaper consumer products; I don't believe it. It's going to create jobs; I don't believe that either. We're also going to be protected, so we've got a deal so our stuff can get into the States. Adam Zimmerman says: "That's a laugh." The minister talks about how macho we are, how good we are and how we'll be able to punch — it sounds like R.B. Bennett — our way into the markets of the world, and blast our way.

Zimmerman says: "Clearly the deal facilitates north south trade." He doesn't argue about that. But Canada is built east and west, so we'll lose our east-west trade and we'll have more north-south trade. How does that build a better country? We don't even have free trade in agricultural products in Canada between provinces, let alone with the United States.

He goes on to say: "There seems to be a kind of mindless applause at the fact that such a deal may allow us to be in all respects like Americans." This is what Zimmerman said — a big corporation, one of the biggest in Canada. You'd think he'd be jumping up and down and clapping his hands and running around doing little dances, because the corporations are supposed to love this deal so much. More nonsense.

Who does he quote at the end here? Rudyard Kipling. "Lesser breeds without the Law" — wasn't that one of his unracist quotes? He says: "The marvel to which the Canadians seemed insensible. . .was that on one side of an imaginary line should be safety, law, honour and obedience, and on the other, frank, brutal decivilization; and that despite this, Canada should be impressed by any aspect whatever of the United States." He said that about 100 years ago. I would think he was pretty astute at that.

I would also like to turn to the little matter of who the winners are and who the losers are and who wants this stuff. I'm going to take a little quote here from another left-wing publication of the Canada West Foundation. It says on page 6: "Industry positions on free trade with the U.S. by share of western Canadian employment...." Fifteen percent were in favour and expected export to increase in cattle.... When I was down in Washington in the last while I went to the U.S. Department of Agriculture. They're going to take 20 million marginal wheat acres out of production. Guess what they're going to grow on those lands. Grass. Guess what they're going to shove the grass through? Animals.

[4:00]

AN HON. MEMBER: Horses.

MR. ROSE: Not horses. So those cattlemen who are dancing in the streets about this free trade deal better think a little bit about that as well, because they're going to have real competition for a change.

"Cattle, oil seeds" — it goes along further. "Four percent in favour, expect no export increase: fishing, uranium, lumber, wood industries, steel, agricultural...."

Moderately in favour, 6 percent: food processing, textiles, meat packing, distilling, air and rail transport, management consulting. It certainly wasn't truckers, I'll tell you that. They're not interested. As far a food processing is concerned, I think they should be rather cautiously optimistic. As a matter of fact, they should be scared, thoroughly frightened. That's not what you thought I was going to say, was it, Mr. Chairman?

I quote another one of these radical foamers on the left. Here's the guy from McCain Foods. That's one of the biggest and most flourishing food producers, totally Canadian-owned. This is what this man has to say. He's Archie McLean, a real left-winger. He says: "These pamphlets on free trade are a moral fraud." He told this to the Canadian chicken marketing delegates: 100,000 jobs would be lost in the agrifood sector in the next 15 years under the free trade agreement. He's the closest thing we have to a tycoon who's said anything like this, other than Adam Zimmerman.

I respect some of these men. They've done really well in business for themselves and their companies, and I respect their views on this matter. Zimmerman says it's questionable; McLean says its a rotten deal and that we'll lose what few processors we've got left. After all, Aylmer is gone. Jolly Green Giant, Stokely–Van Camp and Del Monte own virtually all our canning and food production industries in this country. But that's not enough: they're going to have more, because we chickened out. Anybody who thinks those marketing boards are going to last very long better have another thought. A marketing board works only if you draw a fence around something, and you fill it with your own produce, and you keep everybody else's out. That's how it works. The minute those dairy and chicken products and others come across the line, you don't have any marketing board. Just ask the grape growers; you don't have anything left.

So they'll go because the production in the United States is so vast that there's no way they can compete against those economies of scale. They're shooting cows down there by the thousands under some of their programs, and the next year they've got more cows. I know the member for Central Fraser Valley is an expert on cows....

Anyway, let's talk a little bit more. I've got a couple of questions to ask the minister. Those industries in western Canada indifferent to free trade: grains, oil, gas, coal, sulphur, newsprint, government, education, health, blah, blah, postal, insurance.... I thought insurance was one of the industries that was supposed to benefit, according to the minister. Legal and accounting services, construction, marine travel, public transit, chartered buses, taxis, wholesale and retail trade. They employ 68 per cent of the people employed in Canada; they are indifferent to it. Opposed to it is 7 per cent: dairy, poultry, eggs, fruit, vegetables, publishing, remanufactured wood products, plywood, furniture, breweries, fish products. shipbuilding, wineries, fine papers, cultures, trucking and investment dealers — they don't like it, sorry.

Out of the total employment in western Canada in the various industries employing our people, 68 per cent plus 7 per cent, or 75 per cent, are either indifferent or opposed. So where's this big groundswell for free trade? Where's it coming from? It's certainly not coming from some of the people that I mentioned. So I have a few questions.

By the way, for the member for Kamloops, who has gone.... He probably went to buy a few lottery tickets.

MR. CHAIRMAN: Sorry, hon. member, but your time has expired under standing orders.

[ Page 4524 ]

MR. ROSE: Maybe I could welcome an intervening speaker.

MR. BLENCOE: Mr. Speaker, we'll allow the member to continue. We're thoroughly enjoying his dissertation on free trade, and perhaps he would continue.

MR. CHAIRMAN: The first member for Langley has asked leave to make an introduction.

Leave granted.

MRS. GRAN: Visiting the House today we have Mayor John Beales of Langley district and the administrator, Jim Godfrey. Would the House please make them welcome.

MR. ROSE: I wanted to ask the minister whether, under free trade, it will be legal to give preferential treatment to Canadian companies as an industrial strategy — either nationally or provincially.

HON. MRS. McCARTHY: I'm pleased to be able to respond to the opposition House Leader. Let's take the last question first. If they're illegal now, and if they're not within Canada's trade relationships now, they will be non-legal afterwards. In other words, any enhancement of those that are established or accepted now, and that are grandfathered would not be available after the free trade agreement.

It's interesting that you should say that at the conclusion of your address, because you made reference to McCain. It was interesting that this morning the hon. member for Vancouver East took the part of the big five banks. Today the opposition House Leader takes the part of McCain. In terms of having any self-interest in not wanting free trade, that company certainly would be one of the most highly subsidized companies in this country, subsidized by the federal government and in competition with our food processors in this province. So it's interesting that you should take their part.

The excerpts that you gave in terms of the Canada West agreement.... That is an old study that predated the free trade agreement. It was a contributing document — as many documents were — leading up to the free trade agreement. The agreement was accepted by the Canadian government, and then there was another study that came out which you failed to mention — which was interesting. The document that you're quoting from predated the agreement itself by over a year. What you really should have quoted in terms of a study was their further document. After studying the agreement once it had been cast, the Canada West Foundation, which you have given many quotes from today, says this:

"The British Columbia economy will derive significant benefits from the Canada-U.S. free trade agreement, as over 185,000 jobs are in sectors which expect to benefit from the agreement in terms of provincial GDP. Sectors directly benefiting from the FTA account for 18 percent of output, compared to only 2.4 percent in industries adversely affected by the FTA.

"A major forestry sector in British Columbia is highly dependent on access for its softwood lumber, shakes and shingles, pulp and paper industries.... More secure access to the U.S. over the long term should facilitate investment, production and job growth of forestry-based products, natural gas, minerals and so on.... The performance of key sectors of the B.C. economy, primarily forestry-based but also emerging high tech industries, will lead to important spinoff benefits for service sectors.

"The new capital investment from Japan, Hong Kong and other Pacific Rim countries to gain tariff free access to the U.S. will have a major bearing on the magnitude of economic gains for B.C. under the FTA."

In a very graphic illustration in this report, dated April 1988 — far more current than the publication that the hon. House Leader is quoting from — it says that in British Columbia.... We talk a lot about Kelowna and other areas in this House in terms of the free trade agreement. In the Kelowna area, the no-effect-whatsoever is 76.8 percent; the positive effect is 18.2 percent. There is a negative effect of 4.9 percent, and the net effect in that area is 0.13. In British Columbia alone, in the total area, this same corporation or association that the hon. member is quoting says that there will be minimal effects in 83 percent of the total British Columbia economy. There will be very positive effects in 15 percent, and the negative effects total 2 percent according to their study.

But we don't have to look to just their study. The hon. member was quoting Mr. Zimmerman, who we all know is chairman of Noranda Forest Inc. He has recently made some statements in eastern Canada about the free trade agreement, and we all know, too, that in some parts of Ontario they have been very much against a free trade agreement. As I said yesterday, they really are sitting in a very good position, because they virtually have a free trade agreement in terms of the auto pact. We're simply saying that we just want equal treatment. They have special treatment, and we want equal treatment.

Mr. Zimmerman — you tell us — is opposed to free trade, but I'd like to quote Mr. T.M. Apsey, president and chief executive, officer of the Council of Forest Industries of B.C., representing all the forest industry of British Columbia. He says:

"Our lumber industry has been significantly more efficient than our competitors' in the United States. We are efficient in British Columbia. Their efforts to restrict our access have resulted in actions that effectively penalize us for being too efficient. Under a free trade agreement, both countries would be free to test the limits of their comparative advantages. This should work to our industry's and to this province's benefit."

If you want to make comments about another forestry firm, we take the comments of John Howard, senior vice-president of law and corporate affairs in MacMillan Bloedel in this province, who says: "The removal of tariffs is a tremendous incentive to us to produce value-added products." If you're going to quote people, make it even. I would prefer to quote in terms of the forestry industry; I would prefer to quote somebody who knows this industry on the ground in British Columbia.

There hasn't been a more efficient forest industry anywhere than in British Columbia. We are world-competitive right now. We've done that through a very difficult process: it was called a very deep recession. And they have increased their productivity in that industry and the mining industry in this province by 50 percent — something of which we should all be proud.

[ Page 4525 ]

The selective quoting goes back to the first member for Vancouver East (Mr. Williams), who quoted extensively yesterday and again this morning a Bank of Nova Scotia study regarding the Canada-U.S. free trade agreement. It's interesting that the hon. member for Vancouver East failed to say — and I quote this from the study: "From a Canadian perspective, the economic benefits of a successful deal are quite considerable."

I say again that the hon. member quoted some very negative quotes, and I think they were selectively quoted. He was saying yesterday that the Scotia bank risk evaluation index ranged from a maximum risk of minus 4 to a maximum benefit of plus 4. However, the bank's overall risk assessment of the agreement, including all sectors, was plus 1, a positive assessment. He didn't go on to tell us that end of it. The resource and manufacturing sectors, which are of particular importance to British Columbia's economy, were assessed at plus 3. The study lists three specific industries with a plus 4 rating: fertilizers and petrochemicals and segments of the paper and mining industries.

[4:15]

Let me quote again from that same bank study that the first member for Vancouver East quoted:

"Our analysis indicates that a comprehensive trade deal, including services and agriculture, will provide a modest benefit to the national economy from the outset. This overall judgment is supported both by an analysis of a broad range of industries and by macroeconomic situations.... The overall impact of the agreement still looks to be moderately positive and a marked improvement over the alternative of risking the firestorm that promises to follow in the wake of the omnibus U.S. trade bill."

We don't hear anything about the trade bill, which the hon. members from the opposite side choose to ignore.

If you want to start quoting free trade analyses from our country, you can look to those which have been provided to us by the Economic Council of Canada. They say in very clear terms that "over the past 40 years, Canada has seen its tariff levels drop substantially" — reading from their report — "and yet it has enjoyed the most rapid rate of employment growth of any OECD member country." It flies in the face of the argument that the members of the opposition have given us.

Since 1945, as I mentioned yesterday, our tariffs in this country have fallen from almost 50 percent to 9 percent, and since 1945 our standard of living has increased. Our employment has increased many fold, Mr. Chairman. Our economic prosperity has been enhanced, and it is ensured by liberalizing the tariffs and the trade laws. In other words, in the province and in the nation today, the average tariff on all dutiable goods and services and products coming into Canada has been reduced since 1945 from 50 percent to 9 percent. In that time there has been a great increase in our standard of living and our employment picture — our situation in Canada; and what we strive for in a free trade agreement is to reduce the 9 percent to zero percent. In the reduction of that last 9 percent, we will be able to see an enhanced and ensured liberalized trade in our nation and allow our people to respond to that situation and to those jobs and opportunities.

Let me say that the Canadian management consultants' organization, which also did an overview — if we want to quote those who have given very much time to assessing this — has estimated that for us there is a new $3 billion market in the U.S.A. through the FTA.

There are many people that we can quote. It was interesting that the Bank of Nova Scotia was taken so much out of context; I'm glad I have been able to put that record straight.

MR. ROSE: I would like the minister to note a few things that I have here. One of them is: what U.S. trade laws have been abolished since the original signing of the document in January? Is there not before the House now a monstrous, big — I was going to say omnibus but I will say ominous — trade bill that will pass the Senate; and when it passes the Senate, what good is this bill going to do for us? What kind of dispute-settling mechanisms do we have in place in the free trade agreement?

When we move to free trade, which is really economic integration with the United States, I want you to tell me whether you think our dollar will rise or fall.

MR. BLENCOE: One question at a time. Too many questions.

MR. ROSE: Too many questions? I was playing 20 questions.

Is the minister aware that exchange rates and the value of the dollar are probably more influential on trade than anything else, including free trade? She mentioned yesterday the C.D. Howe Institute. Studies there, empirical evidence of free trade, a 1 to 1½ percent difference in the GNP. One study — this probably was done by Canada West — said 9 percent. But the Economic Council of Canada at that time — and that was last summer in Milwaukee, in the middle of a tornado — said 1 percent. That's all the difference it made — 1 percent.

Of course we had 50 percent tariffs in the Bennett years — more Tory years — and in the Hoover years. Of course trade is enhanced by lowering tariffs — nobody argues that, not at all. But there are a few little things that have happened since those years too. You might remember World War II; that made a big difference to the kind of economy we had. We threw out all the Tories and the conservative approach, and we recovered, due to a combination of Franklin Delano Roosevelt and probably Mackenzie King and a few other interesting people who came along at that time.

Anyway, there are some questions. Remember the deep recession in the forest industry? I remember it, all right; I was here in 1983. I know you fired about 3,000 schoolteachers and a whole flock of civil servants. That ought to teach them to be more efficient. That's what you said about forestry: what this country needs is lots of unemployment, and then everybody will get efficient. That's what we want: more unemployment, and we'll become terrifically.... This whole thing leaves me absolutely wilted.

What's the relationship between Canada's agricultural trade and the United States in the last four years? Do you know? I can't play this game, because I don't have much time — I'd like to. One billion bucks. Every year they're selling us $1 billion more than we sell them. And I'm not just talking about oranges and bananas, either: things that we can produce, but we can't produce them because there is no level playing-field in agriculture — none whatsoever. We're seasonally disadvantaged. Their land prices and water prices and subsidies are all bottom-loaded. The land they have is far cheaper and far more massive. Some of it's marginal, but not as marginal as ours is.

[ Page 4526 ]

You keep up this free trade and kill the wine industry, and you'll blacktop the Okanagan. That's probably what you want to do anyway.

AN HON. MEMBER: Shame!

MR. ROSE: Oh, I don't think so. I think it was kind of a reasoned approach to the problem.

Well, there are a few questions, Mr. Chairman. I've got all kinds more. Are we going to have cheaper imports? Sure we are. Where are they going to be made, if we're importing? Not here. Is it going to enhance our exports? I've seen no proof of it. Most of the people don't even want it. What programs have you got for the losers? What programs have you got in place for the wine industry, the printers, the truckers? The council of boat manufacturers, the Brewers' Association — that's out of it now — the Auto Parts Manufacturers' Association, furniture manufacturers, generic drug manufacturers, the Canadian Conference of the Arts — all these people are opposed to it.

Those are a few questions. I'll have some more later.

HON. MRS. McCARTHY: First of all, let me correct a statement attributed to the Economic Council of Canada. I have the latest Economic Council of Canada bulletin, and I'll read it to you. May 1988: "Free trade should have a modest but positive impact on economic growth and job creation in Canada. By 1998 the trade agreement is projected to result in about 250,000 additional jobs. Real economic growth will have been boosted 2.5 percent above what it would have been without the agreement." The hon. member who has just taken his seat said, as if it were a fact of life, that the Economic Council of Canada had said 1 percent. He was only out by a quotient of three.

MR. ROSE: On a point of order, I made it perfectly clear.... I wouldn't want to mislead the hon. minister unless I thought I could get away with it. Nevertheless, what I did say was that I was down in Milwaukee last summer, and that's the report I had.

HON. MRS. McCARTHY: Also, I think in the beginning of his set of questions he mentioned the omnibus bill in the United States. I understand that it has passed the Senate, and there is anticipation and expectation that it will be vetoed by the President. That's an aside to where that is at this time. Of course, we won't know until that is done.

He talked about dispute settlement. The dispute settlement provisions of the FTA are superior to those of any other free trade agreement or GATT and constitute a significant improvement over the current domestic trade laws. One of British Columbia's key objectives in the trade negotiations was an effective trade dispute settlement process. This has already been achieved, in our opinion, and the FTA's dispute settlement provisions represent an important break with the increasing pattern of American unilateralism in determining recent trade disputes. We have in this the establishment of a formal and effective adjudicative mechanism for resolving trade disputes between Canada and the U.S. It's a major achievement in international trade law. The time-limits set out for every stage of consultation, conciliation, arbitration and dispute adjudication will ensure that matters are dealt with expeditiously. The ability of bi-national panels to make binding decisions on anti-dumping, countervailing duties and safeguard cases as well as certain other cases the permanent Canada-U.S. trade commission designates as emergency action will provide greater certainty and security of access to United States markets for Canadian exporters.

You made reference to the great growth of the economy since 1945, and you seemed to say that it was a comparison between the Depression and coming out of the Depression. But it has clearly been attributable, in terms of economists, to the fact that along with that we have been able to take away the 50 percent tariffs on goods, as I say. We are really just saying now that this is another step in the chain of removing those barriers. We've already done so, and there was no hue and cry; there was no loss of sovereignty. There was only an increase in employment, productivity and our standard of living. Getting away from that last 9 percent, which has to come through a trade agreement.... Otherwise it will not be achievable. There is no question that this is just a step along the way. It is said by the Consumers' Association, I believe, that each family in British Columbia will be better off in terms of consumer goods by about $800 per year.

[4:30]

MR. MICHAEL: It's very interesting to listen to the debate from the members opposite. Last year we heard much reference to the tremendous programs in the wonderful province of Manitoba — all kinds of references to the great things that were happening there in economic development, the great initiatives. This year, Mr. Chairman, all we hear the opposition referring to is Adam Zimmerman. We've come a long way. I can say I'm sincerely looking forward to next year's debate, to see where we will be getting our quotes from the members opposite.

We certainly haven't heard anything about the great province of Manitoba and their economic development initiatives in this debate, as a result of the tremendous election that has recently taken place, where the party that was in power last year has sunken not to the official opposition but indeed way down into third place, in that wonderful province where all those great initiatives were taking place.

If the members want to refer to competing south of the border, competing with our products in the eastern part of Canada, I would ask them to do one simple thing: go out to the exporters, the traders, and get a price on a carload of freight to be shipped from Victoria, Vancouver or any spot in the lower mainland. Get a price on exporting to either Toronto or Montreal, have a good look at the price of exporting that carload of freight, and then compare it with shipping it on the seaboard through the many ports we have in the province to such places as Los Angeles, San Francisco and San Diego. Then come back, have a look and compare those two figures, and you will see why we in British Columbia will be able to greatly expand our manufacturing and export facilities into the southern area, particularly California and Oregon, and make some great strides in creating economic development and jobs in the province.

I think back to the many times over the past years, going down to the States, looking at the cost of products down there — electrical products, refrigerators and microwaves — and listening to people say: "Why can't we get those prices up in British Columbia? Why can't we get the same prices in Canada that we see on the labels in the United States?" Here we have an opportunity, through the free trade agreement, within a ten-year period, to do just that: to get those prices landed here in British Columbia and Canada, and to save all

[ Page 4527 ]

that money through lower prices, putting additional dollars into the hands of consumers and housewives, so they can demand even more goods and services, thus creating more jobs in British Columbia. The average working stiff is going to be a lot better off because he is going to have more purchasing power in his hands than he had before. He can get those products he sees across the line and land them in British Columbia cheaper than what he had before.

We've heard other quotes. I would ask the members opposite, if they haven't read it to this point, to please get the document put out by Prudential-Bache in February 1988. If you can't get a copy from the library and you don't have a copy in your files, contact me and I'll send you over a copy and you can have a look at it. There are some very interesting tables in it. It's one of the best documents I've read regarding free trade and the tremendous strength that we in Canada have in our economic competitive position with the United States.

I'm going to take the liberty of reading into the record some of the quotes from this very interesting journal. Hopefully the members opposite will pick up a few of the points along the way. In the early pages it says:

"The United States and Canada trade more with each other than any other two countries, with the volume and value having grown remarkably in recent years. In 1970 bilateral trade totalled about $21 billion Canadian. A decade later it had quadrupled to $96.8 billion Canadian. In only six years more it soared to $173 billion Canadian. By comparison, in 1985 United States–Japan trade totalled about $91 billion U.S., and trade between the United States and West Germany, $29 billion. In the same year trade between the United States and all the nations of western Europe amounted to about $136 billion."

So you can see the tremendous growth in trade between these two countries — the largest trading partners in the entire world.

In 1960 Canadian exports to the United States were a paltry $3 billion. Conversely, United States exports to Canada were $3.7 billion. They were sending to us $700 million more than we were sending to them. Let's go to the most recent figures of 1986. Canadian exports to the United States, $95.7 billion; United States exports to Canada, $77.3 billion. That's a dramatic change.

Indeed, we in Canada are showing that we are competitive. We can meet the Americans head-on. It has long been thought that for some reason or other our Canadian businessmen aren't quite as sharp as the Americans, that we can't stand up to them, that we can't compete. Let me tell you, Mr. Chairman: that is not the fact. These figures that I'm about to read prove that more than anything that I've ever read having to do with free trade.

On average, the Canadian firms in the survey anticipate even fewer adjustment costs than the American firms and, again, report that they can handle them. More than half of the Canadian firms estimate that their exports to the United States would grow by between 10 percent and 20 percent after a free trade agreement. That's very indicative of the growth that can be expected once the free trade agreement comes into effect on January 1 next.

Canada is also the most important single export market for United States goods. Approximately one-fifth of all United States exports are sold to Canadians. This is very important, Mr. Chairman: Canada buys twice as many U.S. goods as Japan. We buy more from the United States than the total sales from Mexico, West Germany and Britain combined. Ontario alone purchases more goods from the United States than Japan does.

This. Mr. Chairman, is indicative, because I'm sure that a lot of people in the country think that Japan is the United States' greatest trading partner. This document and these figures prove that it is just not true.

Other interesting statistics are noted on page 20 of this report. It reads:

"Professor Alan Rugman, using Statistics Canada data, reports that in 1973 Canadian investment in the United States totalled about 10 percent of U.S. investment in Canada, in line with the familiar 'ten-to-one ratio.'" Now listen to this: "But by 1985 Canadian direct investment in the United States has reached nearly 60 percent of United States investment in Canada."

That's a very dramatic increase, a growth of six times in those few short years. That's a tremendous growth. It shows once again our ability in British Columbia and Canada to meet the Americans head-on. I for one am certainly not at all afraid of a free trade agreement and meeting the United States head-on.

Again reading from the document:

"The stream of new foreign investment into the United States became a flood in 1986, and Canada's investment position in the United States swelled as well. The U.S. Commerce Department reports that Canadian ownership in the United States in 1986 — including corporate acquisitions. joint ventures, new plants, plant expansions and real estate — rose by U.S. $6.7 billion, versus U.S. $2.6 billion of new investment in 1985. If this trend continues, in 1991 Canadian investment in the United States will equal United States investment in Canada."

The members opposite should listen to this. The population of the United States is approximately ten times that of the Dominion of Canada, yet our investments in the United States are nearing a match with United States investment in Canada.

"In terms of the number of acquisitions, Canadians rank even higher. Between 1984 and 1986, they were second only to Britain, totalling 137 transactions compared to Britain's 216."

In the table on page 22, table 7, this document gives an illustration of foreign investment in the United States and compares Japan with Canada. In the five years they illustrate, it is clearly shown that Canadians are investing more in the United States than the Japanese. To me that was remarkable. The figures show that in a five-year period Japan invested $69.7 billion in the United States. Canada's investment in the United States was $72.8 billion. It's more evidence of the tremendous strength of Canada, the confidence that we have in our entrepreneurs and our business and our corporations in meeting the Americans head-on.

"Canada's presence in the United States is substantial and growing. Canadian players are increasingly active in the U.S. economy. Canadian investment comes in all shapes and sizes. Canadian firms set up in the United States to protect established markets or to move into a bigger, more diverse economy.

"Canadians own almost 400 United States manufacturing enterprises, second only to West Germany.

[ Page 4528 ]

Canadian companies employ 527,000 Americans, almost 20 percent of all employment by foreign affiliates in the Untied States."

Very significant statistics, and I'm sure statistics that the members opposite don't like to hear.

Further to that, when you look back at transportation equipment, you see that Canadian exports into the United States marketplace increased 430 percent in the years from 1977 to 1986, nine short years. During those same nine years, the percentage from the United States to Canada increased 249 percent. We nearly doubled them in that area of competition on transportation equipment. Communications and electronic equipment: Canadian exports to United States went up 613 percent in those same years; United States to Canada, 502 percent. We beat them by 111 percent in that field. In industrial machinery, our increase was 289 percent; their increase to us was 209 percent. Again, we beat them by 80 percentage points. Other equipment and tools: Canadian exports increased 659 percent; United States to Canada 248 percent. We beat them by about 2.5 times as to their exports to us. Other consumer goods, Canadian exports 525 percent; United States exports to Canada 230 percent. In that case, we nearly doubled their performance.

It's indicative that the members opposite and the CLC are teaming up to try to defeat an initiative that, in my view, has nothing but positive results. The statistics show that we in Canada do not have to hang our head to our American neighbours. Our business people, our entrepreneurs, can meet them head-on. I believe that the free trade agreement, come January 1, 1989, will show more employment, better roads ahead and a more prosperous British Columbia.

[Mr. Rabbitt in the chair.]

HON. MRS. McCARTHY: The publication that the hon. member has just quoted from.... Bache and Co. is a very respected organization. Some of the figures that he has given us today have been useful in this debate.

One of the things that I think we have to remember, and one of the last points made in the report which was read to us and quoted from today, is to do with Canadian investment in our country leaving home. The reason that Canadian investment over the years has left home in very many examples is that they cannot jump or overcome that wall of tariffs. So they have left Canada to go and put installations in the United States. A U.S. trade agreement will allow them to come home or allow less of that flight of money to go south from our province and from our nation.

[4:45]

Something that hasn't been suggested: there's no question it also gives us an access. We had comments about the marketplace, but from Alaska to California we're talking about a marketplace of 40 million people. The hon. member who has just taken his place has pointed out to us that that's quite a remarkable marketplace to add to a province of less than three million people.

One of the things that hasn't been suggested and we must emphasize is that in a province that has $5.5 billion in procurement — that is, our Purchasing Commission and our government purchases $5.5 billion — we're talking of having access to federal and state procurement that is $140 billion. We're talking about $140 billion in federal and state procurement opportunities added. Through the free trade agreement, we will have access to federal and state procurement. In addition, the Canadian investment will not leave.

I think overall that what we can understand in our province today and have understood very clearly since the world recession we lived through.... One of the lessons we learned through that recession is that we have to have a very competitive edge in this province and that we are dealing with a world economy, and we have to have an attitudinal change as well. That attitudinal change will be of great advantage to us in our competition with the world.

The hon. opposition House Leader said that we won't be able to have access. He shakes his head when I say that the procurement is on the table for it. It is not yet negotiated, but it is on the table for negotiation and has that ability of $140 billion. We in this province already....

MR. ROSE: We've lost on it.

HON. MRS. McCARTHY: We haven't lost on it. It's under negotiation and will be negotiated, and is one of the opportunities to be negotiated under the FIFA.

In addition, this province will probably be far more able to take advantage of those kinds of opportunities, plus the business opportunities, because we have established in this province something no other province or state has. We do have an electronic system by which we can get those opportunities before every small hamlet, community, business and individual in this province.

I'd like to thank the hon. member for his remarks regarding the Bache and Co. report, because they are very positive, as have been most of the reports that have been done.

MR. ROSE: There are so many things flying around here, I hardly know where to start on this. First of all, I'd just like to give the member for Shuswap-Revelstoke (Mr. Michael) a little update on buying a microwave. I've got a report here dated March 12, 1988, in the Sun under free trade. It says that if the average cost of a microwave is $430, its duty is $27. That duty will be reduced by $2.70 per year over the next 10 years. So that poor working stiff who wants the microwave is going to have to wait 10 years for it.

MR. MICHAEL: That's going in the right direction.

MR. ROSE: Well, there are lots of things coming along we didn't even know.

You talked about all our exports. Guess what they are? They are largely Auto Pact and resources — lumber, gas and electricity, and about a million barrels of oil a day squirting down to the United States because it's largely owned by American companies and that's where their market is and that's what they want it for.

Sure, the average working stiff might benefit from cheaper prices. Everybody's interested in benefiting from cheaper prices. There are lots of cheap prices in Hong Kong. I just came back from Bangkok; there are lots of cheap prices there, but what kind of a standard of living have they got? They have no standard of living.

Here's a little quote from Eric Kierans, a nice fellow: "A glance at history shows that neither the United States nor Canada has ever believed in laissez-faire government or in free trade theory. If they had, all manufacturing would have taken place in Korea, Hong Kong, Japan, etc., long since. Consumers would have found prices cheaper, but since many would have lost their jobs, where would they find the incomes to purchase the cheaper goods?"

[ Page 4529 ]

Both the minister and the member talked about investment and how much Canadian investment has gone to the United States, and isn't it wonderful how it's growing. It's sure wonderful. I just wish more investors would invest in Canada. That would be kind of helpful, wouldn't it, if they invested in Canada? There are all kinds of investments that could be made in Canada without offending anybody's ideology.

Here's what some of the banks have done.

"Canadian banks are owed about $28 billion Canadian by debtor countries in Latin America and the Caribbean." They didn't invest in Canada. "Yet while these Canadian missions are urgently hunting for investors, the country's major commercial banks, aided and abetted by the federal government, are pouring billions out of the country. And much of the investment capital that has left our shores in the past 15 years will have to be written off .... By the standards of any normal individual citizen, that is a pattern of behaviour touched with lunacy. But it is condoned and encouraged by the bankers, politicians and bureaucrats."

Eric Downton, "Commentary," Vancouver Sun, June 15, 1987. Shameful!

I don't think this debate is about free trade at all. I think it is about integration of our country with the United States. Here are some differences. We have marketing boards in agriculture; they don't. We have higher safety in pesticides and grade standards than the United States. We have higher labour, fuel and equipment costs. We have medicare, unemployment insurance, workers' compensation.

If we harmonize Canada and the United States, guess who is harmonizing with whom? What will happen is that harmony with the United States will be achieved at our expense. I don't think there is any question about this. We become an integrated economy. Our dollar will be the same, so we won't be able to have the differences that we have had. Why can't we build a multilateral trade arrangement with some countries? Why do we have to be stuck with this, locked together with the United States? Because they want us to be the fifty-first state, that's why. There is no reason for it. There is no rush for it.

Here's what a guy by the name of Kindleberger said: "In a continental trade agreement with the United States, one nation ...would survive as an economic unit: the United States. The other nation...would be just about through as an economic unit. There would be one set of exchange rate, monetary, fiscal and commercial policies, and that would be that."

Kierans goes on to say:

"Since 'such lofty issues as sovereignty and independence, national and cultural integrity...do not lend themselves to the analysis of hard facts"' — the views of those raising such questions are dismissed —"as having no basis 'in theory, logic, analysis, history or precedent."'

Eric Kierans happens to be a Liberal, just as our Minister of Finance (Hon. Mr. Couvelier) once was rather loyal to that very old and hoary political party. He is certainly respectable and a respected economist. You can't dismiss Eric Kierans as some kind of ham-bone. He's concerned about the future of our country. He's not just some donkey that's out there. Dr. Eric Kierans, Canada medal or whatever they get for being distinguished — Order of Canada.

What concerns me is that we are getting hooked here on ideology. Canada has always been an offence to the market economists, because it has worked. We have developed our own style of safety nets and our own way of dealing with social and political problems, and it isn't the American way. If we are going to lose our country because we vertically or horizontally — I think it's more like horizontally — integrate with the United States, then it is a matter of great concern to all of us, because it's not just talking about us. The minister is right: it's not going to change us, or me, or my friend over here. He'll still be his old warm self, no matter whether we have a free trade arrangement or not. It won't make any difference as far as he's concerned. But it will to our kids.

I like the Canadian way, and I think we'll lose it. The minister will say we've had the European Economic Community for years, and it hasn't changed them. There's a little difference of languages and culture and their own traditions and past. There are no people in the world more alike than Canadians and Americans, but we are subtly different and we want to stay that way

Mulroney Conservatives are not Conservatives at all. They are U.S.-style Republicans. They weren't the kind of British Tory that would permit such things as the CPR and the CBC and other developments of that kind to be integrated. They were interventionists. These guys aren't. If it isn't the market economy, it doesn't wash. If we integrate our economy, as different as it is, with that of the United States, and we are going to harmonize ours with them, we lose our differences, and we become part of the market economy.

I'm known as a socialist — a pinko, some people would say. But I'll tell you one thing: there are some things we could do in this country that are an offence to the market economy, and if we integrate we can't do them, because it offends the market economists. We've always been offensive to the market economists.

What a bonanza for consumers. I'd love to have more time. I could read you some things. In a year, if we have this deal, cars.... We have this deal: a car that now sells for $15,000 in Vancouver, with taxes, will sell for $17,000 after the free trade deal if we buy it in Seattle. But we are not going to be able to go down to Seattle to buy it.

We've developed in our country a number of things to frustrate the market economy. An unfettered market economy was what brought this world to its knees in the thirties — along with protective tariffs; I'll grant you that — and the things we've done in this country over the years were to provide safety nets to frustrate the brutality of the market economy. You say: "Well, you know, I'm a free-enterpriser. It's my right to fail." Yeah? You just see it happen, Mr. Finance Minister, and they'll be around there for a grant as fast as you can say whatever you said.

What have we done? In agriculture we've got the landbanks, the land reserves. We had a debate here the other day about property rights. Do you think that the agricultural land reserve or any city zoning or any of that would survive under private property rights in the constitution? Nonsense! There would be litigation running out of our ears by every big real estate company in the country. But to get back to this: we developed wheat pools, co-ops and credit unions, we have special rates, we have the FCC that our friend Mr. Hewitt left to head, we've got export incentives, deficiency payments, two-price systems, wheat boards, subsidies, farm income assurance, marketing boards and perhaps others. They're all at risk under free trade. Those are the things that have kept

[ Page 4530 ]

our agriculture — and other industries — in this country alive, because they prevented them from being taken over. We're going to lose those things. Sure, they distort the market, but do we want to trade it for the U. S. agriculture, or any other thing where it's controlled by a few countries and that's all?

There are natural advantages in Canada over the United States. Alberta's red meat industry is an example of that. But it's not the same forever. It's our idea that we've got to penetrate the United States. The question is: who's penetrating whom? We'll soon find out that, and I think it will be extremely disappointing to us. They have given up not one bit of their laws in trade laws — not one. They've given us no indication that they're going to go for procurement; that was a big deal.

[5:00]

I'd like to close this part of it by saying that we're not opposed to trade. We can't survive without it. But we think the Mulroney-Reagan trade bill is too big a price to pay. Why didn't the Americans enter one with Mexico? Do you know why? Because all those U.S. plants just across the border from Tijuana would have to really compete then, wouldn't they? They couldn't escape and go to.... Why don't we have a free trade deal involving the Pacific Rim — Japan, Mexico, Central America, Australia and New Zealand? Then we could all pool and do what the European Economic Community does: it builds a fence around Europe and keeps everything else out. Is that what we're going to do? No, we're not. The first Toyota cars just the other day were shipped into Japan, so it's not going to go that way.

Many of us are very concerned about it, and I've just scratched the surface. The whole thing just bristles with questions. If I could see where it was going to help us, compared to what we've given up, then I could be more supportive. But I'm not more supportive, and I think it's going to bring vast changes we haven't even anticipated. And they're not all going to be good. Sure, there are going to be some winners. Of course there'll be winners. In any of these new deals there are winners and losers. But we want to know: who are the losers and who are the winners — we haven't heard that yet — and what are we going to do about the economic basket cases, like the wine people, when this is all finished?

HON. MRS. McCARTHY: The hon. opposition House Leader makes comments about the Pacific Rim. You know, we're just as supportive, on this side of the House and in this government, of the multilateral trade negotiations as we are of the FTA, and we have stated that and have been supportive of that with our federal administration. We are participating in the talks in the Uruguay round. We are participating in helping frame the Canadian position; we've been asked to do that and are supportive of that. So if you ask why we're concentrating on the U.S.-Canada free trade agreement, we are not ignoring the world. We are not ignoring the Canadian position for the world — the Uruguay round is a world position, with 90 countries participating. So I do want you to know that we haven't ignored that.

I think you made some comment about Canada being brought to its knees because of.... It wasn't brought to its knees because we had the opportunity for trade; it was brought it to its knees by the Smoot-Hawley agreement. It's taken 50 years for us to overcome what was imposed upon this nation and the world — the 50 per cent tariffs in all of their policies on the U.S. dealing with the rest of the world and Canada. That was a beggar-thy-neighbour policy that the world couldn't tolerate. We don't want to have that. It's taken the world 50 years to get out of that. So I really differ with you in why we have been in this position and why we've worked so hard for these past 50 years, particularly the past 30 years, in order to reduce the tariffs. We are at that point now, as I've made clear.

You said you know that we're very different from the United States, and yes, we are. We are proud of that difference. But it's interesting that the socialists, in saying that we want to stay different, and there's no one, particularly in this House.... These are the people who run for public office because they believe in the nation and the province and put their lives on the line for public service. There's no one you have to convince in this House about how strong we want to be as Canadians and British Columbians.

There isn't any example you can give in all the world's history that says that an economically weak country is a culturally strong country. You can look at the comparison between a small country like New Zealand and its trade deal with Australia. It's hard to imagine two countries more different than they in terms of small and large. It's interesting to note that they were not intimidated in any way. We could go to the survival of Britain with the European Economic Community. Fifty million people in the U.K., and they haven't been swallowed up by the 250 million in the European marketplace — the rest of Europe.

We can even come closer to home and see, if we look back at Newfoundland's history in our country, that if they had joined Confederation in 1800 they probably would have been a very strong economy within the Maritimes. But instead of joining in 1949, they virtually could have taken over the whole of the Maritimes if they had had a start. It shows that a weak economy does not allow strength in their community.

What we have seen in all the total arguments coming forth from the NDP opposition in this House is fearmongering of the worst kind. It shows a total lack of confidence, Mr. Chairman; it truly does. It shows a lack of confidence in our nation and in our ability to survive in a competing world. There's no question that a free trade agreement and a stronger economy in this province and in this nation are going to make us stronger culturally and strong within our nation. Anybody who is, as the members of the opposition are, creating fear of losing the Canadian identity.... The Canadian identity will be stronger with a strong economic base.

MR. MILLER: I want to talk specifically about the fish processing sector, but I wanted to comment on some of the issues developed so far in this debate. I must say that the debate is getting interesting. I can't recall that there have been many opportunities, either in this House or out in the province, to have this kind of back-and-forth debate over whether free trade — or the free trade agreement, or the Mulroney trade deal — is in fact a good deal for Canada. I would hope that we will have more opportunities than just the remaining 50 minutes to deal with this.

It seems that there are a lot of set-piece arguments by the supporters of the Mulroney trade deal to justify their position, and indeed, to sell it to the rest of Canadians who by and large, in my opinion, are still on the fence on whether the trade deal is a good one for Canada. Most people don't really understand what it's about. That's probably the question I get

[ Page 4531 ]

asked most frequently about the trade deal. What's it about? What are the pluses? What are the minuses? That information is not out there.

I happen to believe that the Canadian economy is a good one. I like the fact that it's a mixed economy, that it's based in large measure on the government playing a key role, whether it was in the early formation of the country in terms of transportation or in terms of specific subsidies to develop specific industries. I think we've made some serious mistakes along the way, but nonetheless, I think the underpinnings of the Canadian economy are good, and I think they can get stronger without the free trade agreement.

The minister quoted Mr. Apsey in terms of the forest industry in British Columbia. That is significant because the forest industry is a major part of the economy of this province. It's interesting that the single reason most people I've talked to in the forest industry have for supporting this trade deal is that they are hanging their hat on the dispute settlement mechanism and saying that with that in place we'll at least avoid that terrible time that happened as a result of the export tax placed on British Columbia's softwood lumber by the United States.

If you go back and track that dispute, if you look at the reasons why that dispute came to be, you'll find it was a failure of policy on this government's part that allowed that to happen. The underpricing of our timber resource by the stumpage system in British Columbia constituted a subsidy to the forest industry in British Columbia. They were taking advantage of it, and who can blame them? They dramatically increased their market share in the United States at the same time there was a fairly high level of unemployment in those producing states. The reaction from the United States was predictable, as would be the reaction from any sovereign nation. We're seeing all of these goods coming into our country. We look at the low prices they pay for the raw material, and we say, "Let's call a stop to it." That's what happened.

To suggest that now we need the free trade deal to shore up or support or make sure the forest industry continues to prosper I think is foolish. The forest industry will prosper if it's efficient, not because of the dispute settlement mechanism. Had the province been charging a decent rate for the raw resource in the first place, and had the current Premier and the past Minister of Forests not publicly come out and said, "Yes, we are subsidizing our raw resource," there might have been a different outcome to that dispute as well.

It's interesting. We have quoted Adam Zimmerman, and not because we're particularly big fans of Mr. Zimmerman. I've never met him, so I can't really comment personally. What was interesting about Mr. Zimmerman's speech on the free trade deal was that he was able to separate his corporate interest from his personal interest.

It seemed to me he suggested in the latter part of his speech: "As a Canadian, quite separate from my position as a captain of industry in the forest industry, I question the value. I question whether what we give up in terms of this deal is sufficient." I appreciated that gesture, and I think perhaps one of the reasons why he is being quoted is that it is all too infrequent that industrial leaders do separate their corporate interests from their interests as individual Canadians. Surely we have to deal with the interests of individual Canadians if you want to talk about Canadian identity. We have made a conscious decision to implement certain strategies to maintain a way of life.

I'll deal with the agricultural industry. My colleague has spoken about it. I heard the member for Shuswap-Revelstoke (Mr. Michael) talk about the deal for consumers as though it was the Holy Grail, as though the prime objective is to satisfy a demand that consumers have for lower prices. If we carried that the other way and reversed it and applied it to our agricultural industry, I presume that we would do away with marketing boards. You make a conscious decision that there is a price to be paid for everything.

[5:15]

In the case of the agricultural industry. it's preferable to have that kind of supply management even though the consumer prices might be higher. That's a conscious policy that you make. It's not a dictate solely of the marketplace. It takes into consideration other factors such as employment and the desire to maintain that kind of capability to produce agricultural commodities. There is a very real fear and a very genuine fear that those kinds of things will be sacrificed to the alter of the marketplace. The marketplace is not everything.

I question whether the capital investment figures cited by the member for Shuswap-Revelstoke are particularly relevant. I look at, for example, a major deal such as the Campeau deal, in terms of buying New York real estate, and I wonder what particular benefit that is to us in British Columbia in terms of trying to build our industrial capacity, modernize and do all those other things. It doesn't seem to me to be of any benefit whatsoever. It's the kind of phony statistic that those who are caught up in this rhetoric of free trade want to apply.

The proponents always talk as though it's a one-way door. All of a sudden we've opened up this tremendous market in the United States, and we'll be able to make all of these nice things and ship them down to the United States, and won't that be great? But, you know, the door has been taken off the hinges. It's a two-way street. I mean, they can come in here, they can compete, and they can beat us in some areas. I'm quite confident of some of our industrial capacity to be efficient, to be competitive and to rank with the best in the world; we have reached some of those levels — and only some — in the forest industry. We have a long way to go before we are really super-efficient and really good at what we are doing. We only have to look at some of the European communities to know that.

I want to turn to fish, because as the minister is aware and as others have been aware, there is an industry that is extremely competitive and efficient, yet it is being threatened. My contention is that it does tie into free trade, that it's not solely....

Interjection.

MR. MILLER: I won't talk about the threats from the Minister of Environment (Hon. Mr. Strachan), because I don't think they are really intelligent enough to comment on. A more serious threat, obviously, is to the processing industry, and we know that's a significant industry. We know the entire fishing industry, for example — $750 million and 24,000 jobs — is a significant industry in this province. Beyond that, I don't think many southern members realize the significance of that processing industry to some of the small communities.

The minister talked about statistics. the dry recitation of: "Oh, well, maybe 2 percent will be hurt." Two percent could be concentrated in a pretty small area, and there could be

[ Page 4532 ]

significant damage done. We have seen over the years the transference of ground-fish, where the ground-fish that used to be processed in this province are now, for the most part, being taken down to the northern states and processed there, and we can't compete. We cannot beat them, because they pay piecework and, in terms of that market, we just can't get into it at the rate that a U.S. company can.

I don't think free trade will change that. I don't think it's a matter of opening the border and having that access. We can't compete. When it comes to labour, it seems to me it is an essential argument that should be made. We in the fishing industry have very high wage rates. They are unionized jobs for the most part; they are good-paying; they are very seasonal. They are not long-term jobs at all, but they are regular jobs that take place every year. There are a lot of native Indians involved in that processing industry, and the wages are high. Despite that, in the salmon canning industry, I understand that we are very efficient, but not so efficient that that raw resource can't now be taken down to the United States.

We will see the demise or the erosion of that very valuable industry. I question the policy or the interpretation — and perhaps the minister could comment particularly on this — that says we are not allowed as a sovereign nation to take a raw resource, a Canadian resource, and put this kind of limitation on it, which says that resource must be processed in this country. It's a common thing, I would think, a situation that any sovereign nation would be prepared to have, yet we are denied the opportunity to say that Canadian resource cannot leave this country unless it's processed.

I wonder what the minister's views are on that. Does she feel that Canadian resources in their raw form should be subject to a pure marketplace environment; that anybody who has the wherewithal can come and buy them; that processing should not be a requirement that we impose on resources as a social policy, in terms of employment?

HON. MRS. McCARTHY: The hon. member has covered a number of resource areas, and I'd like to just comment on the last subject he brought up: fish processing. The fish processing rules were federal and were challenged by the United States under the GATT panel. It puts in train an implication for the federal administration to put alternate measures in place, and we have supported that. We agree that that must be done. It's a GATT ruling; it's not an FTA ruling.

The FIFA for the fisheries industry would have been positive. The GATT panel report ruled against the fish processing export controls. B.C. has a commitment to put some kind of replacement in place in cooperation, coordination and negotiation with the federal administration. It's a federal government administrative situation. But before the GATT panel kicked in or became a concern, and in looking at that sector, it was agreed by many people — certainly in our overview of it — that the impact on processed fish products in British Columbia would be to make our processed fish products far more competitive in the U.S. market under an FTA agreement. That has been put aside now as the GATT panel is in place.

You mentioned a bit about agriculture, and the supply management programs involved in agriculture are not affected by the agreement. These are specifically excluded in the negotiations.

You mentioned dispute settlements. I think we both agree that in the overall FTA, a dispute settlement is a very important part of the negotiations, and one which British Columbia fought for as well as the nation under the federal administration.

When you talk about the forestry industry, you should really look to those people in the industry in British Columbia. Again, I would like to say that we have become so efficient in that industry in this province that the potential for value-added wood and pulp products is tremendous under an FIA. That says everything to our people and to this province that we've been saying for years. As all political parties have said: "Let's get the diversification of this economy going."

There's a tremendous opportunity for that here. We all believe in it. We've all campaigned on diversification of our economy. We're seeing it happen in this province, and it will happen even more under the FTA — not according to my comments or the comments of my ministry, but the comments of the forest industry itself. I quoted them earlier today, and I can quote them again. COFI, who is the representative forest industry council of our province representing many forest industries in this province, has said that we wouldn't have had the last countervail if we had had the FIA in place. If put in place, it will prevent another shake and shingle incident. It couldn't happen under an FTA. It does not rule out what has happened in the past, but from now on under an FTA we would be protected against such measures.

I've touched on some of the things you've asked about; I hope I haven't left any out. I've been trying to keep notes for you.

MR. MILLER: Madam Minister, I suggest we might not have had the countervail if we had been charging a decent rate for our resource in the first place, and I think there's lots of evidence to bear that out.

Interjection.

MR. MILLER: Well, if I'm not sure of it, Madam Member, then I wonder why your Premier publicly stated that was the case. I wonder why he did that. He seemed to be sure of it at the time, and when he did it, the United States rubbed their hands in glee and said we have all the evidence we need — and bang, there was the countervail. If you don't believe me, believe the person who sits a couple of seats away from you.

We believe in diversification. In fact, for years this party has been arguing that we have to diversify, and that we have to get away from simply mining the ore or cutting the trees down and applying minimal processing. There's no question about that. As a principle, we agree. How we can possibly move into diversification in a big way, given the competition that's going to be in the United States and the obvious advantages they have? I don't think that's going to be possible in an extensive way.

When it comes to dealing with agriculture, fine. We don't have to give up our supply management, but presumably at some point the tariff barrier will be taken down. Presumably that will happen. Do we compete with U.S. imports at that stage, Madam Minister? Do we compete with the unregulated, with the labour that's cheaper? Do we then decide that we're still going to maintain our supply management? What do we do then? Do we say: "Well, we're good Canadians; let's pay more because they're Canadian goods"? It's all pie in the sky.

Going back to the fish, I really want to get the minister's view. I know it's a federal issue, Madam Minister. I know that

[ Page 4533 ]

you commented at the time, and I wasn't too pleased with your comments in terms of the GATT ruling. Is it the minister's view that raw resources in British Columbia should be subject to purchase by any country without processing? Is that the minister's view, that they should be subject to the marketplace?

Secondly, if it's not a free trade issue, I wonder why the question of west coast processing was discussed between the Premier and the Prime Minister, and why there was an attempt to get that encompassed under the free trade agreement. I assume that's what happened. I think that's been stated by the other side. Certainly the east coast processors were successful in that regard. They went to the Prime Minister, and I don't know what more clout they had that the Premier of British Columbia didn't have when it came to that issue. But it's a significant industry; I wonder why that failure took place. Surely the issue was discussed. I'd like the minister to confirm that that was part of the discussions on the free trade agreement and that there was a failure on the part of British Columbia to get what they wanted.

[5:30]

Finally with regard to the agreement, the Premier was, I suppose, one of the first and most ardent, if you like, proponents of the free trade agreement. I think he expressed himself quite early in the game and quite enthusiastically when it came to telling the Prime Minister: "I'm on board; I'm on side. You can count on British Columbia; we think it's a good deal." But since that time there appears to have been a number of setbacks. In the throne speech, the government was quite critical of the federal government in terms of B.C. not getting their fair share.

I note that in an interview with the Premier in an April 5 Vancouver Sun article, the Premier expressed himself in terms of that relationship with Ottawa and the free trade agreement. I'll quote from it because I think it's significant. The Premier — from one of the main provinces in Canada, one of the best supporters of the Prime Minister in the free trade agreement — had this to say about protective measures for those industries that would be negatively impacted by the free trade agreement:

"B.C. was shortchanged by Ottawa in preparations to deal with problems of free trade. We were a little disappointed when we were left off the federal commission that is supposed to look after the transition period and provide various other opportunities or recommend to government what it is government or governments might do to help in the adjustment process. We were left off. We were upset by that, in fact, so much so that the thrust of our throne speech became 'Ottawa, give us a fair share.' We're now going to have to establish our own commission."

I'm wondering if the minister wanted to comment on these quite strong statements by the Premier, who initially was one of the main guys: "I'm right there. I'm with you, Brian. You know, free trade. Let's go." Despite that, one would question why, having given that early support, he was treated so shabbily by the Prime Minister. I wonder if the minister would care to comment on that.

Finally, I have some questions about the landing requirements. I don't want to be particularly vocal about them at this stage, because we've seen the expressions from the United States about them. There certainly seems to be a real question as to whether they are consistent with GATT or whether GATT would eventually rule. I think a letter sent by the current Minister of Agriculture and Fisheries (Hon. Mr. Savage) certainly expressed his reservations about that. Without trying to prejudge what might happen at GATT, or whether the United States will indeed try to challenge the landing requirement provisions, let's just say, for example, that they do, and they're successful. There's no reason to think they won't be, because we don't seem to be very good when it comes to stating our position or defending Canada's interests in GATT — a fact that didn't go unnoticed by Premier Lougheed in his speech last month in Vancouver.

Is this commission that B.C. has now established to deal with those negatively impacted industries prepared to be an ongoing commission? It will be like a hospital for wounded industries in British Columbia: you can come in and get a transfusion. Despite what the minister says about the rosiness of the free trade deal, we're certainly not convinced, and there are a number of other British Columbians not convinced. The minister may find herself changing her position as time goes on. I'll leave it at that and ask the minister to comment.

HON. MRS. McCARTHY: The hon. member commented on some statements the Premier made in terms of the committee. I think all the statements concerning disappointment or concern, or words to that effect, regarding the free trade agreement and the negotiations were on the council that was appointed following the FTA. Following the acceptance of that and the negotiations ending, there was a committee established.

At first, we were under the impression that every single province in the nation would have a representative on it. The decision was made by Ottawa to have representation from the east and central and western Canada with one chairman. Really, there were only four members, as I understand it, and Dr. Wagner of Calgary heads up the committee as chairman. They will be in British Columbia on June 2 and 3, and we still have Mr. Horswill representing us. He has been an outstanding representative for us. I'm sorry that earlier today I did not make an introduction of Mr. Doug Horswill, who is beside me right now, my assistant deputy minister.

In response to those comments, the Premier has never been anything but positive about the free trade agreement and about the way the agreement has been handled. We've been very well informed through Mr. Horswill's connection over a long period of time — preceding this government, going back through two years of negotiations.

You made some mention of the export controls. The export controls on logs are protected under the FTA, and you did mention the east coast fishing. East coast fishing rules were not under attack through GATT: they were provincial not federal rules, and they were grandfathered. The rules for B.C. date back to 1910, when federal laws were passed at that time.

We believe that access to resources is an issue which will be dealt with by GATT. This is the first ever GATT case in the area of resource processing ever. May I say that our Minister of Agriculture and Fisheries (Hon. Mr. Savage) has been very close to this; it is something he has been working on with very great effort, and he is very much up to date on it. We are protecting our fish-processing resource in this province, through our Minister of Agriculture as the lead minister.

MR. CLARK: I don't plan to be making any great speeches on free trade, as my colleagues have covered it very

[ Page 4534 ]

well. But I have a specific question and concern about the free trade agreement which I'd like to canvass with the minister.

The minister will know that the federal government will be bringing in legislation probably this week or next week to implement the free trade agreement. There is a section in the agreement that says that the federal government will compel provinces to abide by the terms and conditions of the agreement.

[Mr. Pelton in the chair.]

For someone who is passionately concerned about provincial rights.... I know that in the past, provincial governments in British Columbia have certainly supported provincial rights. We haven't heard anything yet from this government. We know that Alberta, Saskatchewan and Quebec, three provinces which support the free trade agreement, have all categorically said to the federal government that if they bring in legislation which trammels or fetters in any way provincial rights in areas like liquor distribution, etc., they will challenge it in the Supreme Court, along with Ontario.

It's not a question of whether or not one supports the free trade agreement. It's a question of whether or not the federal government should impinge upon an area of exclusive provincial jurisdiction. I feel very strongly that the provincial government, regardless of their position on the question of free trade, should make clear to the federal government that they won't tolerate this kind of incursion on provincial responsibilities. That's been done to date by three provinces that support the agreement, and it has not been done yet by this administration.

I would hope the minister would make clear that she will not stand for any attempt by the federal government to legislate in an area of provincial jurisdiction simply to compel Ontario to comply with the agreement. It deals with the fundamental question of our constitution and our democracy in Canada: the division of powers between the province and the federal government. I hope she'll take the time now to side with Alberta, Saskatchewan and Quebec and make clear that the province will not tolerate any federal incursion on provincial jurisdiction.

HON. MRS. McCARTHY: The Minister for International Trade in the federal administration is meeting and has had negotiations with each of the premiers across the country. I doubt that any of those premiers have broken their confidentiality agreement, which is to find within those premiers and along with the federal trade minister an opportunity or mechanism to proceed with the trade agreement without impinging on the rights and also to proceed with some kind of implementation program. But those agreements are not within my jurisdiction or responsibility. They're in good hands with the Premier of our province, working with the federal trade minister. At the present moment that is being looked after under a very confidential negotiation or meeting. Therefore I can't give you any information whatsoever, except that we are upholding British Columbia's position in terms of our support for the free trade agreement and our assistance, if possible, in terms of the implementation of the FI'A. However, I'm sure that those discussions and the decisions arrived at between those premiers will become public in the not-too-distant future, because of the legislation going into the federal House.

MR. CLARK: I find it a little disconcerting that the minister wouldn't take the opportunity to say that she wouldn't tolerate the federal incursion into provincial jurisdiction, because whether or not those discussions are confidential, and they may well be, three provinces that support the free trade agreement have already publicly stated — some today — that they will not tolerate federal overriding legislation which forces the provinces to comply in areas of their jurisdiction. It would seem to me that a province that was on top of these negotiations and that knew what their position was with respect to provincial rights would send a clear message to the federal government that — in the government's case — while they support the free trade agreement, they will not tolerate legislation that impacts on our rights. By not doing that, you're telling people that you're so committed to free trade that you're blinded to the potential implications of federal legislation which impacts on our rights under the constitution.

That's been a long-held position in British Columbia by successive premiers regardless of their political persuasion, particularly starting from Mr. Pattullo, but going back even further than that to McBride. I'm sure the Attorney-General would recognize that. McBride and others have long felt that in British Columbia we've had a strong tradition of standing up for provincial rights. Yet it seems ironic that one of the only provinces — indeed, as the minister herself states, one of the provinces with the strongest support for free trade — has been silent on the question of this potential bombshell we're going to see from the federal government. I hope she would reconsider her remarks and state very clearly that while she supports free trade, she will not tolerate that kind of incursion in our jurisdiction in British Columbia.

HON. MRS. McCARTHY: Well, we're talking about a trade deal — not a constitutional deal. British Columbia does believe that we can avoid any incursion on our provincial government rights. We believe we can avoid that. But as I mentioned to you, that is in the discussions now taking place with the minister responsible for the federal administration — the Premier of our province.

MR. WILLIAMS: It seems clear the minister is not prepared to take a firm stand, unlike the Attorney-General of Ontario, Mr. Ian Scott, who has made it very clear for some time that this deal does represent significant incursions into provincial jurisdictions in terms of pricing policies, processing questions, energy and allocations around areas of energy. It even threatens the prospect of new Crown corporations in Canada, and constitutional experts — Mr. Scott included — see that as a potential. That's a serious matter, and for the minister to leave it to the Premier is not reassuring. You've had to deal with problems with the Premier in the past.

[5:45]

On some smaller items — not smaller but interesting ones. Maybe the minister could advise the House how the minister of state thing works with your department. You have the member for Burnaby-Willingdon (Hon. Mr. Veitch), who is the minister of state for the lower mainland. He's been looking around trying to find a project, and he mainly seems to have found himself a racetrack — that is, a motor one. You're also looking at a thoroughbred racing one, but a motor sport race-track seems to be his major project, which is surprising given all the opportunities we have in the lower mainland.

[ Page 4535 ]

Does he meet regularly with you to discuss these projects, and is the motor sport project one that your ministry reviews? In terms of any significant funding, is all of economic development initiated by these ministers of state reviewed by your ministry? Did you win those battles of the turf, Madam Minister? Are you in control of these ministers of state who are moving around our eight regions in British Columbia?

HON. MRS. McCARTHY: I'd be very pleased to share with you the system by which the Ministry of Economic Development is working with the ministers of state in the eight economic regions in the province.

It is interesting that you say: did I win the battle of the turf? What an interesting comment. A member who was on the government side and a minister at one time is the questioner, Mr. Chairman. You know, it's interesting that his view of the world is one of turf, one of fights between the members on this side of the House. It makes one wonder. I wish I had known what his personality, his problems with that...were prevalent during the time of his administration, because we could have had a lot more fun, couldn't we, in terms of questioning.

At any rate, you gave me two questions. One was the overall, and then you specifically added the motor sports. First of all, let me say that on the motor sport question, our ministry has had a lot of submissions over the years. It has been a longstanding problem in the communities, because there are some communities that have been suggested for the motor sport industry that do not want the industry. There are others who want the industry and are vying for it. The resolution for that came in discussions with the minister of state for the region and myself, in terms of putting the hon. member for Chilliwack (Mr. Jansen) in charge of a committee of one to look into that whole area. That's because he had had a very good track record in bringing to the House and the government some information on yet another problem which presented itself about a year ago, and therefore he was chosen to do that. We are awaiting his report on the motor sport action.

The ministers of state for the eight regions work very closely with my ministry. All of those programs that are economic and not in the social services field that come to us through the ministers of state come to us by assignment, with one member of my ministry being assigned to each of the eight regions, in terms of having information flow. We have one person in our ministry who is able to deal with that region and become very familiar with the region. That's really how it works.

When it comes to an economic initiative that requires an analysis of the business plan — which all of them almost always do — it is then brought to the lead ministry, the Ministry of Economic Development, for assessment. We assess it. We will give our recommendation. It then goes through the regular process of Treasury Board and is brought to the economic development committee, which I chair, and then it goes on to the government for approval. We try to fast track them as much as possible, but not to the extent that we lose sight of the proper evaluation of each and every proposal put before us.

MRS. BOONE: I was interested in this, because at every opportunity the government has said that this isn't an extra level of bureaucracy, that these ministers of state are there to give direct access to cabinet. Yet here we have another level of bureaucracy, because you are still going through your ministry — you are still doing exactly what we are saying. It is not a direct line to cabinet. That's been your sale line throughout everything: "We want a direct line to cabinet; we want to be able to bypass these ministers on that." You are denying exactly what your government has been indicating — that it isn't another level of bureaucracy. How can you defend this, Madam Minister?

HON. MRS. McCARTHY: You're asking two questions here. The hon. member for Vancouver East asked how we vetted those applications or those business proposals. We are a resource and we vet business proposals. We always have and we always will. I don't know if you want an answer that we allow a minister of state or their particular staff to do it, because I don't think that you would want that. The expertise is built into the Ministry of Economic Development.

You asked the question of the economic regions. I think the economic regions are important for access for the people, to take to the people of the north and central British Columbia the ability of access to the ministers of state. Yes, they can bring things directly to the cabinet table — and do. There are very many that have been brought to the cabinet table, and they have been dealt with expeditiously. They may not all be economic. But decision-making is being done. I have to tell you, they are working very hard at that job, and they're doing a darned good job. And I want to tell you that my colleague that sits behind me here goes into the Nechako region. I'll bet they haven't seen a member of government up there as often as they've seen the Minister of State of that area. I'm very pleased with what he's doing in that regard. They have a commitment of access for the people of all regions of the province. Those of us who are privileged to represent our constituencies know that those who come from the lower mainland. particularly those people who live on the Island here, and particularly southern Vancouver Island, have access to government far more readily than somebody living in Atlin, or even somebody living in the interior of the province.

The opposition wants to make a huge controversy over the minister of state situation. My ministry works very cooperatively with the ministers of state. They are coming up with good, creative ideas. And creativity is what British Columbia is all about. Good ideas is what British Columbia is all about, We're just pleased we've got multiples of people doing that. We're very happy.

MRS. BOONE: I find this really interesting. On the one hand, you're saying there isn't an extra level of bureaucracy; on the other, you say they're there, and they're working very hard. You seem to dismiss entirely the existence of local MLAs and the fact that people have access to their local MLAs. They can go to their local MLAs and they can take these things directly to the minister, which has taken place in the past. Perhaps they do not have access to a government member as you so aptly state, but they do have access to an elected person. That person is their MLA, and they are responsible for taking that information to the ministry. They are responsible for speaking up on behalf of their people.

What these ministers of state are doing is bypassing them, trying to work around the existing MLAs, to go in and create, as I said, this other level of bureaucracy. It's clear that there is another level of bureaucracy, because you do have people

[ Page 4536 ]

working and bringing information to these other committees. They take the committees back to the minister of state, whenever they have their meetings. Then the committees take this economic development plan to you, Madam Minister, or to your ministry, whereas all this could have been done between an MLA and the minister. Surely you can see that.

HON. MR. STRACHAN: Just let me respond as the Minister of State for Cariboo economic development region. The member has got it wrong. The member has been invited to share in all the discussions and meetings of the minister of state in the Cariboo economic development. We haven't bypassed the member; the member has bypassed us.

Vote 19 approved.

Vote 20: ministry operations, $51,593,099 — approved.

Vote 21: economic and regional development subsidiary agreements (ERDA), $14,848,500 — approved.

Vote 22: contribution to the British Columbia Pavilion Corporation, $6,102,000 — approved.

ESTIMATES: MINISTRY OF PROVINCIAL
SECRETARY AND GOVERNMENT SERVICES

On vote 56: minister's office, $236,125.

HON. MR. STRACHAN: I move the committee rise, report resolutions and ask leave to sit again.

The House resumed; Mr. Speaker in the chair.

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

Hon. Mr. Strachan moved adjournment of the House.

Motion approved.

The House adjourned at 5:57 p.m.