[ Page 6247 ]

CONTENTS

Routine Proceedings

Oral Questions

Gas pipeline to Vancouver Island. Mr. Harcourt –– 6247

Labour and justice committee meeting on electoral boundaries.

Mr. Sihota –– 6248

Appointment of president of B.C. Institute of Technology. Mr. Jones –– 6248

Low-level military flights. Mr. Perry 6249

Federal support of kaon factory. Mr. Loenen –– 6249

Ministerial Statements

Gas pipeline to Vancouver Island. Hon. Mr. Davis –– 6250

Ms. Edwards

Pharmacy dispensing errors. Hon. Mr. Dueck –– 6251

Mr. Perry

Residential Property Tax Increase Limitation Act, 1989 (Bill 17). Committee stage.

(Hon. Mrs. Johnston) –– 6251

Mr. Blencoe

Mr. Mowat

Mr. Barnes

Mr. Williams

Mr. De Jong

Third reading

Provincial Symbols and Honours Act (Bill 4). Committee stage.

(Hon. Mr. Reid) –– 6257

Third reading

University Endowment Land Park Act (Bill 16).

Committee stage. (Hon. Mr. Dirks) –– 6257

Mr. Harcourt

Mr. Guno

Mr. G. Hanson

Hon. Mr. Weisgerber

Third reading

Committee of Supply: Ministry of Government Management Services estimates. (Hon. Mr. Michael)

On vote 31: minister's office –– 6262

Mr. Williams

Mr. Barlee

Mr. Lovick

Mr. Clark

Appendix –– 6275

The House met at 2:05 p.m.

HON. MR. SAVAGE: It's indeed a pleasure for me to rise in this assembly today to welcome the board of directors of the B.C. Federation of Agriculture, who are circulating through the precincts to meet with several MLAs to make them better aware of the Ministry of Agriculture and Fisheries, as well as the industry they're directly involved in. I'd really appreciate it if this Legislative Assembly would make them welcome.

Also in the gallery today is school trustee Dale Saip from the Delta School Board. I would also like to have him recognized, as well as to say that Dale has worked very hard for our party, and we really appreciate that. Would the members make him welcome.

MS. PULLINGER: Mr. Speaker, it gives me a great deal of pleasure to introduce my aunt and uncle, who are in your gallery today. Probably many people here will know them: Percy Pullinger and his wife Margaret. Percy was a school superintendent in Kootenay school districts and latterly in Sooke School District. Would the House please make them welcome.

MR. LOENEN: It's always a delight to welcome constituents, and I'd like to welcome two people who, in their respective professions, make a wonderful contribution to our community. Mr. Glen Laubenstein is the administrator at the municipal hall, and Harvey Gibault is the municipal engineer. Would the House please welcome them.

MR. BARLEE: I would also like to take this opportunity to extend our welcome to the various directors of the British Columbia Federation of Agriculture. We wish them a warm welcome in the precincts of the House.

I'd also like to extend a welcome to an old friend of mine, Mr. Bud Wilson, who played hockey, tennis and lacrosse with me many years ago. He is a resident of the city of Kelowna and is now living in Victoria.

MR. ROGERS: The first member for Vancouver South (Mr. R. Fraser) and I would like to welcome three constituents here today: Penny Hazle, Sachi Yamakami and Mona Blusson.

MS. EDWARDS: I would like to welcome Bob Webster, who is executive director of the Federation of British Columbia Writers. In that position he represents some of the most creative people in the world — the writers of British Columbia.

HON. MRS. JOHNSTON: In the gallery this afternoon we have, for a repeat visit, former Vancouver alderman Helen Boyce, who is also here as a member of the board of Theatre Terrific in Vancouver. With her is Sue Lister, artistic director of Theatre Terrific, and the founding director, Connie Hargrave. I would ask the House to please make them all welcome.

MR. SIHOTA: I thought my good friend the member for Kootenay (Ms. Edwards) was going to join my good friend the second member for Nanaimo (Ms. Pullinger) to make this a hat trick for Percy Pullinger. Percy is a constituent of mine, and I've served on the board of directors of the Pacific Centre for Human Development with him. I too would like to extend my warm wishes to Mr. and Mrs. Pullinger. Welcome.

MRS. GRAN: Mr. Speaker, seated in your gallery today are two very dear friends of mine from Langley, Jim and Rita Cunningham. Jim is the director of development and public relations for Trinity Western University, and Rita is a nurse at Langley Memorial Hospital. Would the House please make them welcome.

MR. PERRY: I'd like to draw the attention of the House today to the fact that this is the first day of Passover. It's a very solemn and joyous celebration in the Jewish religion, in Jewish secular tradition, and in the history of the world. It's a date that celebrates one of the first great achievements for human freedom and dignity in recorded history: the liberation of the Jewish people from slavery and bondage in Egypt. I'd like the House to commemorate that today.

MR. ROSE: Mr. Speaker, I've just been advised that 50 grade 9 and 10 students from Hastings Junior Secondary School in Port Coquitlam are in the gallery, along with their guests from Quebec. I believe they're from Maria Chapdeleine School in the community of Jonquiére. They're here on an exchange visit. I would like the House to welcome them.

MR. GABELMANN: I've just been advised that we have in the gallery this afternoon visitors from the communities of Tahsis and Zeballos on the west coast of Vancouver Island: Mayor Tom McCrae of Tahsis, Mayor John Crowhurst of Zeballos, Sandy Naylor and Bob Atwal. I'd ask the House to make them all welcome.

Oral Questions

GAS PIPELINE TO VANCOUVER ISLAND

MR. HARCOURT: I have a question to the Minister of Environment. On Monday the minister said that a natural gas pipeline through the Coquitlam watershed would not damage the lower mainland's water supply. I want to remind the minister that his own staff report concludes: "There is insufficient evidence to rule out environmental damage." As well, the Utilities Commission report states: "The commission is concerned that all details of the environmental protection plan are not in place, yet Pacific Coast Energy Corp. proposes to award construction contracts by May 4, 1989." Given these documents — your own reports — will the minister now agree that there is insufficient information to support his claim of no environmental threat?

[ Page 6248 ]

HON. MR. STRACHAN: I don't know how many times we have to say this. I said it twice on Monday, and it's now Thursday. I thought maybe the Leader of the Opposition would have sorted it out by now.

AN HON. MEMBER: It's the first time he's been here for a while.

HON. MR. STRACHAN: I see.

We have said repeatedly that the project will not proceed if we suspect there is going to be any environmental damage. What else do you want to know?

MR. HARCOURT: On Monday the minister failed to make a commitment that cabinet would put a Ministry of Environment representative on the pipeline monitoring committee. The minister has now had a chance to be briefed by his staff or perhaps even to read the Utilities Commission report himself. He knows that it's his responsibility, not the GVRD's, to protect the environment along the entire pipeline route. Yes or no, Mr. Minister: will you advise your cabinet colleagues that there must be a Ministry of Environment representative on the pipeline watchdog group?

HON. MR. STRACHAN: I don't know if there was a question there. I don't discuss cabinet discussions. Furthermore, I'm advised that my colleague the Minister of Energy, Mines and Petroleum Resources (Hon. Mr. Davis) is going to be making a statement soon on this very subject. So I'll just leave it at that.

[2:15]

MR. HARCOURT: Once again the minister is trying to dump his responsibilities on others. When oil threatened the west coast of the United States and Vancouver Island, he said it was a federal responsibility — he's ready to follow. If lower mainland mayors are concerned about their drinking water, he calls them political and says it's up to them to make their case. Would the minister agree to stop lecturing the mayors of the lower mainland and instead get his cabinet off the political fast track and guarantee the protection of the drinking water for the lower mainland?

HON. MR. STRACHAN: In the first place, the rhetorical question –– 99 percent of it — was nonsense, and the member knows that. Secondly, I have indicated — this would be about the fifth time now — that if there are any environmental concerns, the project will not proceed until those concerns are addressed. We'll write it out for you; we'll have someone read it to you; you can take it from there.

MR. HARCOURT: The tenders are going out May 4. Tender documents have to be drawn. They have to know what the environmental safeguards are. Is the minister saying that all that work can be done in two weeks?

HON. MR. STRACHAN: Yes.

LABOUR AND JUSTICE COMMITTEE
MEETING ON ELECTORAL BOUNDARIES

MR. SIHOTA: I am sure all members of the House are aware of the Dixon decision rendering our electoral boundaries unconstitutional, and all members are aware that the Fisher recommendations are before the Committee on Labour, Justice and Intergovernmental Relations. My question to the chairman of that committee is: when will that committee meet?

MR. CHALMERS: Arrangements are being made for that committee to meet, hopefully at 11 o'clock on Tuesday morning, and you will be advised accordingly.

APPOINTMENT OF PRESIDENT OF
B.C. INSTITUTE OF TECHNOLOGY

MR. JONES: A question for the Minister of Advanced Education. I would like the minister to explain to this House his role in influencing the BCIT board of governors in the recent appointment of a president at that institution.

HON. S. HAGEN: Perhaps I could ask to have the question repeated.

MR. JONES: I asked the minister to explain his role in influencing the BCIT board of governors in their recent decision to hire a president of that institution.

HON. S. HAGEN: Very simply, I had no role in that decision.

MR. JONES: The minister says he has no role. I wonder if the minister can explain why his handpicked board of governors ignored the unanimous advice of the selection committee composed of representatives of the staff society, the student society, the union there, the management there and the education council at that institution in favour of a candidate that the selection committee had rejected but who is close to the Minister of Advanced Education?

HON. S. HAGEN: I'm not sure what he means by "close" to the Minister of Advanced Education. The fact of the matter is that the responsibility for the choosing of a president of that institution lies with the board of governors. The board of governors made the decision, and I happen to concur with the decision. I think it was a good decision.

MR. JONES: I'm sure the minister concurs with that decision. I want the minister to know that the people at that institution are very upset by the decision of the board of governors, and they want to know when this government is going to stop interfering in the operations of that institution.

Interjections.

[ Page 6249 ]

MR. JONES: When are you going to butt out, Mr. Minister?

MR. SPEAKER: Order, please. The question is out of order.

LOW-LEVEL MILITARY FLIGHTS

MR. PERRY: I have a question for the Premier, Mr. Speaker. On Tuesday this week, Innu aboriginal people who protested treetop-level military flights practising first-strike nuclear warfare tactics in Labrador were acquitted by a judge of the Provincial Court of Newfoundland. We are now facing similar low-level flights by the U.S. Air Force in a corridor from Fort Nelson to CFB Comox, a move that will surely bring protests from many British Columbians. Has the Premier protested to the government of Canada against these low-level military flights in British Columbia?

HON. MR. VANDER ZALM: We've not been advised of this happening at Comox. Although I appreciate the question, I know that many of the things that we hear around the corridors are rumours that are somehow emanating from the NDP. I don't know where this came from, or why it has come forth. If you have further information regarding this proposal, I would be very pleased to receive it. However, as you stated too, a decision was made in one particular instance by a court. I would imagine we could see similar action taken, and a judge would again have to decide.

MR. PERRY: A supplementary to the Premier. It's an open secret — it's not even a secret; it's an open fact — that these low-level flights are planned for the corridor from Fort Nelson to Comox. The United States Air Force has made these plans clear to members of the Denman Island Peace Group. My question to the Premier remains: has he protested this to the Prime Minister? I don't think we've received an answer to that question.

HON. MR. VANDER ZALM: First of all, as I have said, I have not received the information as yet. I certainly don't intend to act based on rumours. I think we should get the details of any such proposal to see why it's being proposed, how it's being proposed and what the effect of it is. I am sure that this will all be made available to the government of British Columbia, should that be the case.

MR. PERRY: Just one further supplementary. Many of the tests of this nature are concluded under an overall umbrella agreement signed in 1981 between the government of Canada and the United States government. Can the Premier tell us if he has established any task force in the provincial government to study these issues and to make itself aware, before the flights begin, whether or not the flights are going on? What is their real purpose? Are they in fact first-strike nuclear weapon practice? Are they in fact preparation for fighting a nuclear war?

HON. MR. VANDER ZALM: I appreciate that this is a result of an agreement between the United States and Canada. Most British Columbians — and most Canadians, hopefully — are aware that there is such an agreement. In fact, we share the defence of the continent. With this agreement and the commitment on the part of both nations, there are certain obligations. I appreciate that the member and others might be opposed to the contents of the agreement, or to the fact that there should be some sharing of defence of the North American continent between the United States and Canada.

A lot of Canadians are very grateful that we have a fine neighbour with whom we can enter into agreements and whom we can trust — not only to trade with and to have the benefits of their purchases of Canadian-made goods or Canadian resource materials, but similarly, to participate with us in a matter of defence. I think that Canadians by and large — I appreciate that the people opposite in the socialist NDP don't feel this way — are very appreciative of our good neighbours to the south.

FEDERAL SUPPORT OF KAON FACTORY

MR. LOENEN: My question is to the Minister of Advanced Education and Job Training, concerning the kaon factory and its importance to all British Columbians. Because of the deficit-cutting that the federal government is involved in, I wonder if the minister can assure this House and the people of B.C. that he will make every representation possible to ensure that the project will go through and that the government of Canada will hold to its promises and continue to support that very important project.

HON. S. HAGEN: Yes, there has been some concern on behalf of the Friends of Kaon and the committee that I chair to make sure that this project goes ahead. As the House well knows, this is a very important project for the future of British Columbia. It started out as a project of three universities and has grown to involve eight universities right across Canada, including the University of Toronto, University of Montreal, University of Manitoba and University of Regina, which just joined recently.

Economically, this is very important for the province. The construction alone of a $570 million project will generate 19,000 person-years of employment. It will generate $1.2 billion worth of economic activity, half of which will stay in the province. The other half will be spread across the rest of Canada.

It's important to know that this government is in strong support of this project. I'm not exactly sure where the party across from us sits. I understand that the new critic of research and development, the Leader of the Opposition, may not be in favour of this project, but he should be aware that the city of Vancouver backs it, the GVRD backs it and the people of British Columbia back it.

The kaon factory is precisely the type of clean, high-tech industry that we need in this province. I can tell you that this government will continue to

[ Page 6250 ]

work hard to put pressure on the federal government. We're aware of their desire to balance the budget, and we support that, but at the same time we're structuring the cash requirements for this project to meet their objectives.

Ministerial Statements

GAS PIPELINE TO VANCOUVER ISLAND

HON. MR. DAVIS: I want to state as emphatically as I can that there is no way in which the Vancouver Island gas pipeline will be built through the Coquitlam watershed unless the company, Pacific Coast Energy, agrees to meet all the conditions laid down by the federal government, the province of British Columbia and the Greater Vancouver Water District. These conditions are demanding indeed.

Several members of the official opposition have asked Ottawa to stop the project. The hon. member for Coquitlam-Moody (Mr. Rose) wants it put off for at least six years. The hon. member for Kootenay (Ms. Edwards) has asked the federal Minister of Energy to intervene. She asks that the federal environmental assessment review process proceed; she doesn't seem to know that this review process has been proceeding in parallel with our own — those of the province and locally — for nearly 12 months. We've worked cooperatively since last summer with three federal departments: Energy, Environment and Fisheries and Oceans. I have no doubt that the three federal ministers will sign this project off favourably by mid-May at the latest.

Not only has the B.C. Utilities Commission held hearings over several months and in numerous municipalities, but our Ministries of Environment and Health have had considerable input. They, like the federal departments, have added terms and conditions, all of which are included in the draft energy project certificate that the company, Pacific Coast Energy, must adhere to strictly during the preconstruction, construction and operating phases.

Regional concerns have also been addressed in detail. The project certificate says not only that the standards imposed by the Greater Vancouver Water District on B.C. Hydro, logging companies and other operators in the Coquitlam watershed will be observed, but also that the GVWD is being asked to nominate a person or persons to serve on the pipeline monitoring committee from the planning stage through construction to operations.

[2:30]

Most members know that Greater Vancouver Water District staff have already identified the conditions which it believes must be met if water quality is to be maintained and disruption kept to a minimum. These standards relate to construction techniques and timing, health certification of workers, control of workers on site, waste collection and handling, fuel and lubricant handling, construction supervision, monitoring of water quality and so on. All of these conditions will be met; all costs will be met by the company.

The B.C. Utilities Commission, after issuing its several reports, concluded that risks from pipeline construction in the Coquitlam watershed are "acceptable and manageable." This will undoubtedly be true if the four pages of conditions which are part of the draft Pacific Coast Energy project certificate are met.

They will be met or, as I said earlier, the project will not proceed. Perception is also important. We're not talking about a large-diameter oil line on a 200 foot right-of-way; we're talking about a small, one-foot diameter natural gas line with a right-of-way of 20 feet to 30 feet. When built, it will run along the high side of an existing, relatively wide, well-traveled logging road.

Also, construction will be limited to times when there is little traffic, precipitation is at a minimum and runoffs can be contained. Why deny several hundred thousand residents of Vancouver Island and the Sunshine Coast the human health and environmental advantages of a clean, colourless, odourless fuel like natural gas?

Acid rain emissions by industry alone can be cut by up to 10,000 tonnes a year. The line can also eliminate 300 oil barge movements a year up and down Georgia strait. Fuel bills — residential, commercial and industrial — will fall, and there is, of course, security of supply. This is a B.C. resource, a B.C. source of energy which now will be made available to the majority of people in the province.

The overall benefits — social, environmental and economic — of the Vancouver Island pipeline are too great for those of us in this House to ignore. True, the project must be clean, clean, clean, especially in the Coquitlam watershed, but our three levels of government, together with their various agencies, have looked hard at this project and found it acceptable.

They will also insist that during its construction and operating stages it be a model for others to follow.

MS. EDWARDS: As an example of Mr. Clean, Clean, Clean, this is an amazing decision of what needs to be clean, because the Coquitlam watershed has not been included in what needs to be so clean. What we have here is a classification of several things that need to be addressed that have not been addressed yet. They have identified certain things that need to be addressed. The Utilities Commission report says very clearly that they have not yet been addressed. They outline some of the difficulties of addressing them; for example, if the particular timeframe the minister has laid out is followed, the time windows for doing it in a clean way will be extremely difficult if not impossible to meet.

The pipeline, if it goes ahead, goes through watersheds; it goes through parks. The minister suggests that the Ministry of Environment has been involved in the....

Interjection.

MS. EDWARDS: Up to now. Certainly, Mr. Minister, there was no testimony given by Ministry of En-

[ Page 6251 ]

vironment employees at the Utilities Commission hearings. That's very interesting.

It seems that this is again the whole business of whether we're going to go ahead with a huge project that involves millions of dollars of public money, and whether we're going to go ahead with it in an extremely short and rushed time-frame regardless of whether or not it's going to be proven to be safe and clean. That's the line: it has not yet proven that it can be, and we're going to go ahead anyway. So I accept the minister's statement with a considerable degree of disappointment.

PHARMACY DISPENSING ERRORS

HON. MR. DUECK: I wish to inform this House of a concern I have respecting a number of incidents which have recently been reported in the media and from my staff, involving alleged dispensing errors in pharmacies in British Columbia. There is also a concern that these errors may be related to the apparent dispensing-fee price war among such pharmacies.

The clinical advice of our professional pharmacists is a very important part of the British Columbia health care system. I would be very concerned if long lineups or other factors are pressuring pharmacists to the point where they have difficulty maintaining the standards of their community pharmacy practice. Public safety remains our first and most important consideration.

I want to assure this House that my staff are working closely with the College of Pharmacists and that the college is actively investigating these matters to ensure that standards are maintained and that there is no breakdown in direct communications between pharmacists and prescribing physicians or between pharmacists and the public.

It is, however, important to keep this matter in perspective. Pharmacists dispense in excess of 14 million prescriptions per year, and I am advised by the College of Pharmacists, the professional body responsible for these standards, that dispensing errors have been extremely rare. Should changes be required, I expect to have recommendations from the college in the very near future.

MR. PERRY: I don't think there's anything very controversial here. I've worked often with many different pharmacists, and I have confidence in the ability of the College of Pharmacists of British Columbia to investigate problems and deal with them appropriately.

Orders of the Day

HON. MR. RICHMOND: I call committee on Bill 17.

RESIDENTIAL PROPERTY TAX INCREASE
LIMITATION ACT, 1989

The House in committee on Bill 17; Mr. Pelton in the chair.

Section 1 approved.

On section 2.

HON. MRS. JOHNSTON: I move the amendment standing under my name on the order paper. [See appendix.]

Amendment approved.

On section as amended.

MR. BLENCOE: This is the meat and bones of this particular piece of legislation. In her introductory remarks about this bill, the minister said she had deep reservations about this legislation. I'm wondering if the minister could — for the edification of all members of the Legislature — indicate to us what her concerns are with this legislation. Because you said those....

HON. MRS. JOHNSTON: Mr. Chairman, I believe the bill is self-explanatory, and my personal reservations are really not important at this point in time. We have a bill before us that we are dealing with, and I feel we should be dealing with that and not my personal reservations.

MR. BLENCOE: With respect to the minister, we are not dealing with personal concerns. We are dealing with the Minister of Municipal Affairs — an important ministry — and an important piece of legislation that is going to have a dramatic impact upon assessments and the Assessment Authority in the province by intervening very seriously in the marketplace analysis for tax purposes, and we have depicted the implications of that. The minister has said publicly to the people of British Columbia and to municipalities that she has concerns. As minister, I don't think she can get away trying to say — which she said publicly here as the minister — that these are her personal concerns. I think the municipalities and the public are entitled to know what the minister's concerns are with this bill.

HON. MRS. JOHNSTON: I believe that those reservations have been adequately expressed. We're really talking about a second reading issue, which is the principle of the bill.

It's my understanding, Mr. Chairman, that we are now down to the specifics of the bill as printed before us, and I believe we should deal with those issues.

MR. BLENCOE: The minister said the concerns have been canvassed. Were they canvassed by our side or by your side? We certainly canvassed our concerns in second reading. Are you saying then that the concerns we raised are legitimate and are basically your concerns?

HON. MRS. JOHNSTON: No, that's not what I said.

[ Page 6252 ]

MR. BLENCOE: I think it's most unfortunate that the minister in charge of a very important ministry governing municipalities, regional districts, local councils and this issue — it's bread and butter in terms of taxes and assessments — is not prepared to say, in bringing this bill to the floor of the Legislature, that she had deep reservations. I think that shows that this minister has some problems in terms of this ministry and how she deals with it.

So I'll leave it there, but needless to say, we're going to have some concerns expressed by local government that we now have a minister who has introduced legislation that she's not happy with. She knows there are problems. She's referred to the issues we have canvassed, and I suspect she knows the issues we've canvassed are quite legitimate — the impact on her ministry, the local councils and the Assessment Authority, and the minister cannot deny that. She knows what she has done, and it's damaging to local government.

HON. MRS. JOHNSTON: Mr. Chairman, I would have to ask for your direction on the area of discussion that we should be entering into here. It may be appropriate and necessary at this time for me to repeat some of the comments that were made earlier.

This bill has been brought forward as a result of a request from the city of Vancouver. The request was made by a unanimous vote of that council — representation from the largest local government in the province of British Columbia by unanimous request of their council — for assistance in addressing a very serious concern they had in their community.

As a result of that request, we felt we had an obligation as a ministry and as a government to respond, because we truly believe in local autonomy. We truly believe that members of council were elected to make localized decisions. But having said that, it was important to us in the ministry that the opportunity for addressing the concern be made available not only to the city of Vancouver, but to all of the communities in our province.

We subsequently had discussions with the Union of B.C. Municipalities and several of the mayors on the lower mainland, and the result of those discussions is Bill 17. That is what you have before you.

[2:45]

MR. BLENCOE: What discussions did you have with the B.C. Assessment Authority, and what is their opinion on this legislation?

HON. MRS. JOHNSTON: I didn't personally have discussions with the B.C. Assessment Authority, but there were internal staff discussions with the Assessment Authority.

MR. BLENCOE: Mr. Chairman, I'm sorry. Were you trying to indicate something to me? You have an introduction to make?

MR. MOWAT: I want to speak to this.

MR. BLENCOE: You want to speak to this? Good, I'm glad.

MR. CHAIRMAN: Please proceed.

MR. BLENCOE: Can the minister indicate to us whether the B.C. Assessment Authority supported this legislation?

HON. MRS. JOHNSTON: I'm not sure it would have been appropriate for me or my staff to have asked them whether they supported this legislation. This government is giving direction, not the B.C. Assessment Authority. I can tell you that the Assessment Authority has agreed the proposal is workable, and they are providing the technical help to any municipality that intends to utilize the legislation.

MR. BLENCOE: Does the minister realize the full implications of tinkering with an assessment system like this? Assessments in this province are now carried out every two years, yet this legislation is only for one year. Is the minister aware — or does she recognize — that next year you're going to have the same pressure? You're going to have the same rise in assessments, and therefore there's going to be pressure to do the same thing again; yet we've only got this bill for one year.

HON. MRS. JOHNSTON: I go on facts. I don't have a crystal ball. I would like to reiterate that this legislation is for 1989 only.

MR. BLENCOE: I'm sure the minister is aware, though, that assessments in this province are carried out every two years. Therefore people who had a sudden increase in assessment in 1988 will not see any change in that value until 1990. Is the minister aware of the pressure she will have for 1990 now that the precedent has been set for 1989? Is she fully aware of the precedent-setting tone of this legislation?

HON. MRS. JOHNSTON: No one on either side of the House has any way of knowing what the market is going to do. Indications are that it has already levelled off. Having said that, I would suggest we deal with the bill, which truly spells out that it is for 1989. What it does, in effect, is cushion the substantial increase that some local taxpayers would be faced with. Rather than having it hit them very hard in one year, it is cushioning it and spreading that increase out over two years. But to suggest that we may have — or will have — the same type of pressure next year.... I'm not privy to what may happen a year from now. I'm dealing with what we have before us, which is a bill to address the 1989 taxation problems.

MR. BLENCOE: I assume she'll probably deny this, but if the minister looks at the legislation, at what's going to happen in, for instance, those areas of Vancouver that have experienced assessment increases and high property values.... In your bill I know it's land; I recognize that. Is the minister aware

[ Page 6253 ]

that by capping in those high-increase areas, it's going to transfer the load to those in, for instance.... I'm not that familiar with Vancouver, but evidence has been shown that property holders in the east side of Vancouver will bear the results of capping increases in the west side, the Kerrisdale area.

Does it not concern the minister that you are benefiting those who are seeing the values of their property rise dramatically, and who indeed could benefit by that, at the expense of moderate property owners? That's basically very unfair at a time when everybody in this country and this province is talking about tax reform and spreading the load as fairly as possible. This bill is not very fair in that capacity, because it transfers the responsibility from those who probably can afford it better to those who can least afford it.

HON. MRS. JOHNSTON: The suggestion is that the minister is doing this and the minister is doing that. What the minister is doing is putting forward legislation that allows local government to do something they have asked us to give them permission to do. We are not going into any of the local communities and insisting that they use this legislation. It is being made available to them as a result of a request from the largest community in this province by unanimous vote. I seem to be having a problem getting that message across. In a good many cases, if we are going to be talking specifically about the city of Vancouver, it has been suggested to us, and the figures I produced yesterday would go further to verify, that a good number of the uncapped properties will be looking at tax reductions this year as a result, among other things, of the increase in the homeowner grant that the provincial government has provided and the increase in the provincial funding for schools.

MR. BLENCOE: I appreciate the minister's response to local government, and I know she has on occasion taken some friendly criticism from me that this government at times does not respond that well to local government initiatives and ideas.

MR. WILLIAMS: St. Ann's Academy.

MR. BLENCOE: St. Ann's Academy and the Provincial Capital Commission in the city of Victoria is a classic example. A minister refuses in that situation the people of this area, Victoria, an option to see what the Provincial Capital Commission.... She over and over denies that community input and that request.

Yet there are times when a minister has to take a look at the full implications of legislation. When you are looking at a system that has impact on all British Columbians who own property or their own homes, you are just not making legislation for one community or one neighbourhood. You are preparing legislation that impacts on every area of this province, particularly when you introduce legislation that is precedent-setting and takes us back 20 years in terms of political manipulation of a system that, boy, if you manipulate it, creates all sorts of problems for you.

I think the minister knows the slippery road she has gone down. I think now this government — and I know there are many on that side of the House who've had municipal experience — know what this legislation is going to do. They know how precedent-setting it is.

My question is: is the minister fully aware of the global or the provincial implications of this legislation, despite the request from Vancouver city council?

HON. MRS. JOHNSTON: Yes, I am.

MR. BLENCOE: Well, the minister is aware of the implications, and I don't think I have to address those anymore. We've canvassed them. She'll be hearing from many mayors and aldermen about the slippery road she has taken local government down.

I have one question before.... I understand my colleague from Vancouver Centre has a question. I am wondering if the minister....

MR. WILLIAMS: Little Mountain.

MR. BLENCOE: Oh, right. It's easy to forget about the member for Vancouver–Little Mountain, I must admit.

Question to the minister: will homes that have changed ownership in the last year be eligible for relief under this option?

HON. MRS. JOHNSTON: The answer is yes.

MR. BLENCOE: If I get that correct then, this bill allows those who are speculating in residential property to not only make huge capital gains but also to get a tax break on their assessment. Have I got that correct?

HON. MRS. JOHNSTON: Property ownership has no bearing on whether or not you qualify for benefit or otherwise under this bill.

MR. BLENCOE: The case I am trying to make is that, in terms of fairness for the tax system, those who are participating in flipping and are not living in those properties and are part of the escalating assessments are, in our estimation, a major cause of why you have had to bring in this very questionable legislation. Now it seems that those people not only make huge capital gains and create the high cost of property many British Columbians can't buy, but through your legislation they are going to get a tax break. You are rewarding those flippers and those speculators. Am I right?

HON. MRS. JOHNSTON: It appears that the second member for Victoria sees a bogeyman under every bed and around every corner. Really, we have legislation here. Those of us on this side of the House don't feel that legislation should apply to somebody that the members opposite don't believe should own a piece of property. The legislation applies to the property — regardless of the ownership. That is the way the legislation has been brought forward. The

[ Page 6254 ]

suggestion of flipping and land speculation is not a part of this bill.

MR. BLENCOE: I'm going to leave it there. I think the minister knows the point I'm making, that we have indicated that this bill is very unfair to moderate-income homeowners, and that those who have seen dramatic increases in the values of their property are going to benefit by this. Yet now we also see that those who are speculating in the market and not living in those properties are not only making huge capital gains by flipping properties but are also going to get a tax break from this government. That really shows where this government's interests are in terms of fairness in the tax system. We object to that kind of procedure.

We found out this afternoon that not only is this bill very dangerous in terms of what it actually says in legislation, but it's also going to give a tax break to those speculators who are buying and selling properties without living in them, creating the inflated land prices and housing costs, particularly in Vancouver.

HON. MRS. JOHNSTON: I guess I should go over this again. This bill is a result of a request from the largest community in the province of British Columbia — the city of Vancouver — by a unanimous vote of the city council, the locally elected people, the people elected to make local decisions. They requested this legislation. It's not something that the provincial government has initiated. It's not something that we're doing to give somebody a break over somebody else. It's in response to local government.

[3:00]

We not only say that we believe in local autonomy; we show it by responding to requests that we receive from local government. It's very strange, in my mind, that the second member for Victoria is continually talking about giving local government, locally elected people, more say in what happens in their community, about giving them more authority, about recognizing them to a far greater degree than they are by this government, and then when they have come to us.... They have met with all the local MLAs in the city of Vancouver, and it's my understanding that they received their concurrence and support for this type or similar-type legislation. Now that the city of Vancouver, the largest body of local government in this province, has come to the government and asked for assistance in addressing a problem in their community, the NDP members — particularly led by the second member for Victoria — are turning their backs on local government and saying: "We always say that we believe in local autonomy, but we're really not going to respond when you come to us and ask for some help." I think that that attitude is certainly becoming very prevalent on that side of the House.

I want to tell you, Mr. Member, that the local government, the locally elected people in this province, are watching what's happening on this bill. Whether or not they intend to use the legislation, they are looking to see who supports the position and addresses the concerns of local government, and they're not liking what they see on your side of the House.

I don't know whether the member is just here to attempt to drum up some strange stories about what members on this side of the House are doing, but this legislation is very plain, simple and clear. We are addressing a concern that was brought to us from the city of Vancouver by unanimous vote. The mayor and council have asked for our help, and we're responding. It was unanimous. The letter sent to me, Hon. Leader of the Opposition, the letter I received on my desk.... I don't have it with me, but I can table it for you. It was a unanimous request to my office to deal with this subject, signed by the mayor of the city of Vancouver.

Interjection.

HON. MRS. JOHNSTON: I'm sorry, but the letter, to the member of the opposition, was to the effect that it was a unanimous request to my office.

MR. MOWAT: Mr. Chairman, I hope you'll give me the latitude that you gave the last member in this debate. We're in third reading....

MR. BLENCOE: Committee, committee, committee.

MR. MOWAT: In the committee. But I must say that I'm a bit concerned, and I wasn't able to speak the last time around. In the city of Vancouver we have what we call city caucus meetings. In these city caucus meetings, the provincial members representing Vancouver are asked to attend these meeting with the city council.

On March 10 we had a city caucus meeting when the city of Vancouver brought to us this problem. At that meeting were: the Leader of the Opposition, the former mayor; the first member for Vancouver–Point Grey (Ms. Marzari) and former alderman; the first member for Vancouver East (Mr. Williams) and former city planner; the second member for Vancouver East (Mr. Clark); the second member for Vancouver Centre (Mr. Barnes) came, but I think he was too late for the debate; the first member for Vancouver South (Mr. R. Fraser); the first member for Vancouver–Little Mountain (Mrs. McCarthy); and I was also present. After a lengthy debate, it was unanimously agreed that we would go for this.

MR. G. HANSON: Let's see the Hansard.

MR. MOWAT: We're talking about a city caucus meeting.

MR. G. HANSON: I understand that. Have you got the minutes?

MR. MOWAT: Yes, I do. They're from Mayor Gordon Campbell.

We all agreed. We had a thorough discussion about this. We were talking with.... Now the second member for Vancouver Centre (Mr. Barnes) is shaking

[ Page 6255 ]

his head. You were late; you didn't get to the meeting on time.

But I've got to tell you the former mayor and the first member were there. We discussed a 20 percent capping. After the former finance director, Mr. Leckie, gave a presentation to us, we all agreed. We had a debate, and it was unanimous.

Now the former mayor is shaking his head. It was unanimous. We even debated whether the first member for Vancouver East's new house was going to cost a lot of money because the assessment was going to go up. We said: "Well, he is going to benefit from this."

AN HON. MEMBER: Which one of his houses?

MR. MOWAT: Which one of his properties?

I'm shocked to think that we left that meeting unanimously agreeing with the city council. There were some aldermen there. Alderman Rankin was there; he agreed with it. I just can't believe that after we went through all that that we're going to see that there are some problems with it.

The flip-floppers are back. They sat in the Hyatt and discussed it; they were all for it. Then they get out here and they start to show their true colours. We have reacted to an issue that was brought to our attention, and we gave it to the local representatives elected for the city of Vancouver to look at, and they came up with a program and a solution.

We agreed to it, and it went back to the council of the city of Vancouver, who unanimously agreed to this. I have some real concerns when it was unanimously agreed to by the city of Vancouver, and now we're getting into flip-flopping. They came to us, we sat down and agreed, and then once they come back and see that there may be some political fallout from this, they don't agree with it.

AN HON. MEMBER: On one hand they want a park; on the other hand they don't.

MR. MOWAT: Yes. Just like yesterday: on one hand they wanted a park and now they don't and now they do.

MR. BLENCOE: You're sore about that because we voted for it.

MR. MOWAT: I'm not sore about that. You wasted about three hours of the taxpayers' money. It cost us about....

MR. CHAIRMAN: Hon. members, we are speaking to Bill 17.

MR. MOWAT: It cost about $70,000 to sit here yesterday afternoon and go through something. It's ridiculous.

MR. HARCOURT: Are you saying the Legislature is a waste of time?

MR. MOWAT: No. The way you guys handle it, it is.

MR. BARNES: I just have a couple of questions. First I want to respond to the second member for Vancouver–Little Mountain. I think the remarks made by the second member for Vancouver–Little Mountain just expired those caucus meetings that we've been holding in Vancouver, which have been held at the request of the mayor and are supposed to be in confidence.

Caucuses are for the purpose of sharing in a collegial way. Now it seems as though the member is suggesting that we can go out and talk about everything. I am sure the mayor of the city of Vancouver will be surprised to hear that because we have been talking to him quite candidly in the past.

MR. MOWAT: How can you be two-faced all the time?

MR. BARNES: That's all I'm going to say to that. You can consider yourself as having opened the door on those caucus meetings.

One other thing the minister has suggested was that the vote was unanimous in support of the request by the mayor and council of the city of Vancouver to have this mechanism in order to assist those people whose properties unfortunately have increased so much they can't afford to pay the taxes. In order to assist them, the minister felt it incumbent upon her to make this extraordinary move, something that she deeply regrets but out of respect and a sense of compassion and concern for those people whose property has increased to the extent that they can't afford to pay their taxes.... That's free enterprise going too far.

I want to ask the minister whether a survey was taken among these people who unfortunately couldn't afford to pay their taxes. And were they asked: "Do you wish us to cap your taxes?" Was an effort made to find out just who those people were who couldn't afford to pay their taxes? There's no question about it, Mr. Chairman, there will be people who will have been living in a home, let's say moderately priced at $100,000, which all of a sudden is worth $200,000 or $300,000. Those people may be on fixed incomes, can't afford to pay their taxes and will need some help. I can understand the problem. They are property-rich and dollar-poor, or cash flow-poor.

In some cases, for instance, when a person reaches a certain age and is no longer earning an income — say, a senior citizen — there is a mechanism whereby that person may defer their taxes. In other words, there's a chargeback against the property. When that person eventually moves out or something happens that they no longer will be in that home and when the property transaction takes place, then the property is taxed.

But here is a situation where people are making huge profits and are being forgiven their taxes, and the taxes are being redistributed among the population in the Vancouver area with no charge. I'm asking

[ Page 6256 ]

the minister if any effort was made to find out who could afford to pay their taxes and who could not and if anybody requested this help? In other words, who asked for the help other than the mayor himself?

HON. MRS. JOHNSTON: The answer to the last question is that the Vancouver city council asked for this, Mr. Chairman.

And my goodness, I would hope that we would not attempt to institute a form of referendum from the provincial government in order to ensure that requests that come in to us from local government for legislative assistance would require us to take a referendum of the residents in the area to ensure that what the people they elected — their mayor and council — were asking us to do was really what the people wanted us to do. The mayors and councils in the districts across this province were elected to represent the people of their communities, and surely those are the people we're supposed to be dealing with and responding to.

This legislation is in reply to a request from the city of Vancouver asking us to come to their assistance because they felt they had a serious problem. I would hate to think that we would go in there and ask the mayor and council to start doing a means test on everybody living in Point Grey or Kerrisdale, or on some of the longtime residents who are sitting in those areas who have seen these very dramatic property increases, and ask them how much money they have in the bank, how much they have coming in and if they can really afford to pay their taxes. The mayor and council surely have a feel for the conditions in their community, and I would hope that we wouldn't be out there doing a referendum to question something they've asked us to do for them.

MR. BARNES: I think the minister's response contains all I need in order to deduce her position. It's quite obvious that she has expanded it into something far different from what I'm saying. I'm simply saying that if people need help with their taxes in a fair and equitable situation, then they will certainly ask for it. Here is a case where it's a gift, forgiving a large amount of money — $500 in some cases. Do you mean to tell me that a person who has realized a profit of 200 percent or 300 percent is not willing to pay his fair share of taxes, even if there was a transaction to sell it the next day and he wouldn't owe anything? You don't care about trying to recover that, and yet you won't even protect people on fixed incomes.

As you know, there are many people being kicked out of their homes. There's no rentalsman. You didn't bother to intervene on behalf of people whose rents are going up. You don't want to intervene, because that's the free marketplace. We don't want to get into that debate, because we know the minister's position on that. It's a little biased there.

[3:15]

What I want to ask the minister is: are you prepared to admit that you were incorrect when you said that the request was unanimous? Because it was not. Ald. Gordon Price told me last night at a public meeting where we were discussing this issue: "Look, wait a minute; you're wrong. I did not support it; in fact, I'm opposed to it." I want you to admit for the record that there was at least one alderman not in favour of this.

Interjection.

HON. MRS. JOHNSTON: The second member for Victoria (Mr. Blencoe) has suggested that I have misled the House, Mr. Chairman. That is absolutely incorrect. The letter I received, signed by the mayor of the city of Vancouver, suggested to me that the request was by way of a unanimous vote of the Vancouver city council, and that is what I dealt with.

MR. WILLIAMS: I am just reading subsection (2), and it says:

"The adjusted value of land on the 1989 property tax roll of any parcel of land that is classified as class 1 — residential in B.C. Reg. 438-81 and is included in that roll is the lesser of (a) the 1989 assessed value of the land, or (b) the 1988 assessed value of the land plus 'X%' of the 1988 assessed value of the land where 'X%' is the sum obtained by adding the average percentage increase determined under subsection (3) to 15%."

Could the minister explain to me in English what that says?

HON. MRS. JOHNSTON: I would be pleased to give you an example, although I am absolutely certain that the question is in jest. But I will give you an example.

MR. WILLIAMS: I'm interested in the "X" factor.

HON. MRS. JOHNSTON: Okay. The value in 1988, assuming it to be $100,000.... You're asking where the cap is coming in?

MR. WILLIAMS: I am just asking what it means.

HON. MRS. JOHNSTON: Okay. Assuming that the 1988 assessment was $100,000, and assuming that the average increase in the community was 10 percent, from 1988 to 1989, we would add the 10 percent and then we would allow for the 15 percent cap. So anyone who went over a 25 percent assessment increase would have their taxation number adjusted. We refer to it as an adjusted value.

Interjection.

HON. MRS. JOHNSTON: Mr. Chairman, the second member for Victoria (Mr. Blencoe) has asked the question again. The Assessment Authority will assist any community that wishes to participate in this, and I think we should make it clear that there are only, to the best of my knowledge, with the exception of Vancouver, three communities even entertaining the utilization of this legislation: the two North Vancouvers and West Vancouver. I really haven't heard whether any of those three are going ahead.

[ Page 6257 ]

MR. De JONG: I am not sure whether I am speaking at the right time during this bill, but I do have some reservations about it, although I can understand the reasons why the bill is brought forward. Certainly there is a unique situation in the city of Vancouver and the surrounding municipalities; however, as I said, I have some concern.

Really, by the minister having indicated it — and this bill only applies for this year — I see it as a temporary measure. I would like to ask the minister whether in fact this is a temporary measure and, furthermore, whether the minister is entertaining the idea of communicating with the Minister of Finance (Hon. Mr. Couvelier) to have the Assessment Act changed so that these rapid changes in assessment values can be accommodated in the Assessment Act rather than by these types of measures.

HON. MRS. JOHNSTON: There is no question about this being a one-year piece of legislation. It would be my hope that before too long we would look at ways and means of properly — not on an emergency-type basis — addressing any future possible major fluctuations and heated property sales in the province. Certainly I will be conferring with my colleague the Minister of Finance in an attempt to determine whether there might not be a better way of being prepared for these types of situations.

Section 2 as amended approved.

Sections 3 to 6 inclusive approved.

HON. MRS. JOHNSTON: I move the amendment standing in my name on the order paper, to add section 6.1. [See appendix.]

Sections 6.1 and 7 approved.

Title approved.

HON. MRS. JOHNSTON: I move that the committee rise and report the bill complete with amendments.

Motion approved.

The House resumed; Mr. Speaker in the chair.

Bill 17, Residential Property Tax Increase Limitation Act, 1989, reported complete with amendments.

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

HON. MR. RICHMOND: By leave now, Mr. Speaker.

Leave granted.

Bill 17, Residential Property Tax Increase Limitation Act, 1989, read a third time and passed.

HON. MR. RICHMOND: I call committee on Bill 4.

PROVINCIAL SYMBOLS AND HONOURS ACT

The House in committee on Bill 4; Mr. Pelton in the chair.

Sections 1 to 21 inclusive approved.

Title approved.

HON. MR. REID: Mr. Chairman, I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Speaker in the chair.

Bill 4, Provincial Symbols and Honours Act, reported complete without amendment, read a third time and passed.

HON. MR. RICHMOND: Mr. Speaker, I call committee on Bill 16.

UNIVERSITY ENDOWMENT LAND PARK ACT

The House in committee on Bill 16; Mr. Pelton in the chair.

Sections 1 and 2 approved.

On section 3.

MR. HARCOURT: Mr. Chairman, I would like to put forward an amendment to section 3, which will now be section 3(c). It reads: "nothing in this act shall be construed as to prejudice the claim of aboriginal title of the Musqueam Indian band to the University Endowment Lands."

HON. MR. RICHMOND: First of all, Mr. Chairman, I thank the hon. member for providing us with a copy of the amendment which he has tabled.

After careful consideration, it is my contention that the amendment is not in order, for the reason that it alters the very intent of the bill. It might appear on the surface to be a very short and simple amendment, but I contend that it alters the principle of the bill as agreed to in second reading. I cite Parliamentary Practice in British Columbia, second edition, page 132, where it says "Inadmissible amendments, " if people want a reference point.

In my opinion, this does alter the principle of the bill as agreed too in second reading in that it goes to the very heart of the bill and could at some future date prevent this land from being a park in perpetuity. Mr. Chairman, with the greatest respect I submit to you that it undermines the very intent of the bill, which was to provide a park for all the people of British Columbia for all time. This amendment has the possibility of destroying that intent.

MR. CHAIRMAN: The first member for Victoria speaks to the point of order.

[ Page 6258 ]

MR. G. HANSON: Mr. Chairman, as you make your deliberations with respect to whether or not our amendment is in order, I would like to contend that it is in order. Section 3(b) of the bill states clearly: "the Greater Vancouver Regional District shall not transfer the land and improvements transferred by the grant unless it has first obtained the approval of the Lieutenant-Governor-in-Council." What that essentially addresses in principle is the idea of third party alienation. The debate we've had in this chamber is really about the third-party alienation of the land and the effect that may have on some future case of the Supreme Court of Canada or some other high court of this land with respect to third-party alienation or the patenting of a transfer of land to a third party, which could preclude the validity of a claim.

That matter was addressed by the justices of this province earlier in the year. I don't know whether I need to quote for you, but perhaps I could. In the restraining order application of February 9, 1989, justice Craig states on page 3:

"I turn then to the application to restrain the implementation of the conveyance of the property. The legal problem that lurks behind the conveyance" — this is the germane point — "is that once the conveyance is granted, section 23 of the Land Title Act may preclude any remedy of the plaintiffs" — the plaintiffs are the Musqueam people — "to obtain their claim to aboriginal title. That possibility, in my mind, approaches irreparable harm, and for that reason I think the appropriate order is to direct that there be an order restraining the implementation of the conveyance as proposed."

[3:30]

Subsequent to this judgment, the restraining order was lifted because the GVRD agreed that third-party alienation would not take place from their side. The concern is that the province has not similarly agreed to do that. That is what our amendment is about.

HON. MR. RICHMOND: Speaking against the amendment and for its inadmissibility, I would just like to point out one thing. The member quotes section 3(b) — "the Greater Vancouver Regional District shall not transfer" — as being binding on the use of the land. But the amendment starts out: "nothing in this act shall be construed as to prejudice the claim of aboriginal title...." The amendment clearly negates any section that may come before or after it, just by its mere words: "nothing in this act shall be construed as to prejudice the claim of aboriginal title of the Musqueam Indian band to the University Endowment Lands." I submit that it changes the entire intent of the bill and is therefore out of order.

MR. GUNO: Speaking on the point of order, I briefly want to support my learned colleague from Victoria in his contention that this amendment does not go to the heart of the bill, and that it is really merely a "without prejudice" clause that would preserve the right of the Musqueam people to pursue their claim. I don't think the contention of the member opposite that it goes to the very heart of the bill is valid.

MR. GABELMANN: On the point of order, if you'll take another point, Mr. Chairman....

MR. CHAIRMAN: No objection. I would like to hear what everyone has to say on this particular point of order.

MR. GABELMANN: The government House Leader is assuming that the result of a claim that might be negotiated would be a particular result, which he claims would negate the bill. That may or may not be the result or something that would flow from the discussions. It seems to me that people who have a legitimate claim should not have their right to pursue that claim extinguished by an act of the Legislature, which is designed to do something else altogether. That's the effect of this legislation and why this particular amendment is necessary.

The amendment does not, by passing, mean that there will not be a park and an opening ceremony this weekend. If the government House Leader's point were valid, what we would have is no park, no ceremony and no nothing on the weekend. The fact is that that will happen. If the Lieutenant-Governor arrives tomorrow, as we expect him to, and we go through all of the procedures, even with this amendment passed, we will have a park. Therefore the debate on this amendment is quite in order, and I don't think the government House Leader has a point at all.

MR. CHAIRMAN: Hon. members, this particular amendment has in some ways provided a bit of a unique opportunity for the Chair, because the hon. Leader of the Opposition did mention yesterday that the amendment was coming forward. It did give me an opportunity to review it and to give it some thought. Also, of course, I've now had the benefit of the hon. members' thoughts on this amendment.

I would suggest that the question of whether an amendment is out of order because of its being contrary to the principle of a bill which was considered and passed by the House in second reading sometimes involves a very fine distinction. I've examined the bill and the amendment that has been put forward — notice of which, as I said a moment ago, was really given yesterday by the Hon. Leader of the Opposition — and I have also listened to the arguments as they were presented to this time.

It is my view that the principle of the bill involves the transfer of the land as a park, free of any encumbrance except those stipulated in the bill.

Also I would suggest that the amendment would leave a cloud on the title of the subsequent acquirer of the land, which is inconsistent with park status. Accordingly, I am going to rule that this amendment is out of order as negating the principle of the bill.

MR. HARCOURT: Continuing on section 3, Mr. Chairman, your ruling and the argument put forward by the government House Leader proves our point exactly: that this bill is intended to prejudice the rights of the Musqueam people. That's exactly what we have been saying all the way along.

[ Page 6259 ]

I am indeed saddened that this government has rejected this amendment. Everyone, including the Musqueam people, agree that the University Endowment Lands should become a park. Everyone, except the members opposite, understands that that is not the issue before this House. The issue is not about a park, for the park is not threatened; it's about this government denying the Musqueam the right to seek justice. This government is unwilling to recognize aboriginal rights — in this case the right to negotiate a land claim. Worst of all, this is a government that attempts to exploit, and even provoke, confrontation between B.C.'s native and non-native peoples for its own political gain.

We will have a park in Point Grey. The Musqueam want it; the people of Point Grey want it; we want it. The shame is that this government has intentionally decided to deny the Musqueam the right to negotiate their aboriginal claim, even though it poses no threat to the park.

No doubt this government will attempt to distort the events of the past two days, distort our struggle to right their wrong, distort our attempt to amend the legislation to protect the Musqueam's right without jeopardizing the park. This Socred government has sent a very clear signal to the people of British Columbia. The future holds more of the same with the Socreds: unnecessary confrontation over aboriginal rights and land claims. More confrontation will prevent all British Columbians — native and non-native — from moving ahead with the sustainable development of many of our lands and resources. British Columbians are way ahead of this government. We want aboriginal rights to be recognized so that we can finally negotiate claims and put an end to confrontation and get on with building a better B.C.

This government's political agenda has no room for a responsible approach to building B.C.'s future. British Columbians know that the UEL park is not threatened by protecting the Musqueam's rights. This Socred government wants to bury its head in the sand and not deal with the reality of aboriginal rights — or worse, exploit any unfounded fear of these rights....

HON. MR. DIRKS: On a point of order, Mr. Chairman, I would wonder which section of this we are now debating. It sounds like we are back into second reading, rather than going through this bill clause by clause.

MR. CHAIRMAN: Thank you hon. member. We are in committee stage. I am sure the Leader of the Opposition is aware of that. Please proceed.

MR. HARCOURT: I am indeed, Mr. Chairman. That is exactly what section 3 does: extinguish the right of the aboriginal people. The House Leader in his challenge made that very clear and your ruling cements to beyond 100 percent that that is what this act does. That's exactly what I am saying. That is the result of the act. It is now so crystal-clear to British Columbians what is behind this act. It's not a park.We all want the park. It's to do an injustice to the Musqueam people.

New Democrats are determined to bring British Columbians together, not to tear them apart. To that end I want to read into the record today the following letter that I've sent to Prime Minister Mulroney:

"I am writing to you regarding the University Endowment Land Park Act proposed by the government of British Columbia, which is now before the Legislative Assembly. This act transfers a parcel of land which is currently the subject of a aboriginal land claim by the Musqueam band to the Greater Vancouver Regional District for park purposes. Justice Anderson of the British Columbia Court of Appeal earlier this month granted the Greater Vancouver Regional District the right to proceed with this transfer, provided they do not argue 'third-party alienation' of the Musqueam's aboriginal claim. Justice Anderson also said it would be dishonourable for the government of British Columbia or the Greater Vancouver Regional District to use the transfer to deny the Musqueam people their rights.

"While I and members of my caucus have struggled for years to have this park established, we have also moved an amendment which would create this park without jeopardizing the rights of the Musqueam to pursue negotiations of their aboriginal claim. By refusing the amendment, the Attorney-General and the government of British Columbia are committed to a course of action intended to jeopardize the rights of the Musqueam people.

"The purpose of this letter is to advise you that should the members of my party form a government in British Columbia, we will work to ensure that the Musqueam people have the right to pursue a negotiated settlement. Whether the Musqueam are successful in settling this claim or not, it is our belief that it is essential that their right to pursue a negotiated settlement not be frustrated. In the spirit of the judgments made in the highest courts of Canada, I ask you to recognize the Musqueam people's right to pursue a negotiated settlement of their aboriginal claims.

Sincerely,
Michael Harcourt,
Leader of the Official Opposition"

MR. CHAIRMAN: Hon. member, I'm sorry, your time has expired.

HON. MR. DIRKS: In reply to the hon. member opposite, it has been consistently the position of all British Columbia administrations, including that in place from 1972 to '75, that there are no subsisting aboriginal titles in British Columbia. Bearing this in mind, the government cannot now accept any kind of amendment which might implicitly recognize such claims.

[3:45]

MR. CHAIRMAN: We're on section 3.

MR. GUNO: Yes, I know we're on section 3. I decided to take part in this political process because I thought that I would be part of the solution and I thought that this forum would be an honourable place in which to do that. Today I'm

[ Page 6260 ]

ashamed to be part of this process. I'm ashamed of this government's blatant attempt to thwart the legitimate claims of the Musqueam people.

The member for Texas or whatever — South Peace — talks about there being no claim, no aboriginal right. Well, that's absolutely blatantly untrue. The member for South Peace, this government's version of an Indian agent, says that the position of the province of British Columbia is that if aboriginal title did exist, it has long since been extinguished. The courts have not denied that; in any application to the courts, it has never been overturned. Indeed, it is also the position of the province of British Columbia that should the courts decide at some time in the future that aboriginal title does exist, then by the terms of the union it is quite clearly the responsibility of the government of Canada.

I think that the member has acknowledged the possibility that in the future the existence of aboriginal title does exist. And yet this government has taken steps to thwart the right of the Musqueam people to pursue their legitimate claim. If there are any doubts whatsoever that the intent of this bill is for that purpose, I think that the House Leader today pretty well eliminated those doubts.

MR. G. HANSON: Before I begin my remarks, I would like to introduce Musqueam councillors who are presently in the gallery. I would like the House to make them welcome.

Mr. Chairman, I'm sorry that our guests are having to witness this sad event. We have attempted over the last few days, through force of argument, through reference to legal documents and precedents in this country.... Doesn't this government read the newspapers? Almost every single day in this nation there is a Supreme Court or a County Court case upholding native rights. In the one the other day of the Innu in Labrador, the justice remarks in his judgment: "Did Canada think that it magically took these lands from people? There are no treaties. There is no compensation. There is no extinguishment of their rights." He likened that to seventeenth-century thinking. He said: "When are governments going to get out of seventeenth-century thinking?" If anything applies to the cabinet of this province, it's seventeenth-century thinking.

I think all members know that the Musqueam case is in many respects special, because their misfortune — if you can call it a misfortune — was to live in a place that was enveloped in an urban setting, and have third-party alienation of their traditional territories engulf almost everything but the UEL. After the Calder case Pierre Trudeau said: "Maybe you have more rights than I thought." With a divided Supreme Court of Canada decision, they established the comprehensive claims office and invited claims from all of Canada. Guess what? The Musqueam claim was the only one advanced in British Columbia that was turned down. Why was it turned down? Hugh Faulkner, the minister at the time, said it was third-party alienation of their traditional territories; therefore their claim was extinguished. Shame!

How can you take away a person's right? It's like me going camping, finding a nice field, putting my tent up and saying, "I live here now; this is mine," without any respect for the people who are there already. The Musqueam people were asking not for this chamber to adjudicate their claim, but for simple, natural justice. They were asking that this Legislature not take action to extinguish their claim by transferring to a third party land which they traditionally hold claim to. Shame on this House!

In the Guerin decision — the same Delbert Guerin who appears in many court cases as a champion of rights for the Musqueam people — the justice said that the aboriginal rights were sui generis, or a special genre of rights only extinguishable to the Crown.

The Crown has a special obligation to these people because their rights have not been honoured. Their aboriginal title and their rights are in an overflow of litigation. This decision today was to force the Musqueam people back into the courts again. The thing that heartens me is that I know they will ultimately succeed and have their rights.

HON. MR. WEISGERBER: I feel an obligation, I guess, to stand and speak, having listened to the last two members, who at least had the courage to vote against the bill yesterday, which is more than I can say for the rest of the members across the way who have felt moved to speak today.

There are some points that are worthwhile considering. I was glad that the member for Atlin (Mr. Guno) read my comments with regard to aboriginal title, because they serve to put into perspective where we are coming from. Having taken the position of accepting on behalf of the Musqueam, the only band in British Columbia whose aboriginal claim has been refused by the federal government.... If we were in fact to attach to the title of a piece of land a rider, a disclaimer, a cloud, a caveat because of the interest by a band whose claim is the only one in British Columbia that has been turned down....

If we were to follow this logic through, any other property — certainly any other Crown property in British Columbia located where an existing and accepted claim is — would obviously have to have a caveat on the title. If the Crown were to sell a piece of land to an individual in an area covered by a land claim, it would logically follow that there would be a caveat on the title suggesting that the title is in question because of an existing land claim.

You are then only a very short step away from privately owned fee-simple property transferring from one party to another, in an area that's covered by an aboriginal claim, also including a caveat. I suspect the members will say that land claims don't involve fee-simple lands, but I would direct them to an ongoing claim in Kamloops on a golf course that is a privately owned, fee-simple piece of property. The band has challenged the right of the owner to transfer it to another party because of an aboriginal claim against the property.

What we are looking at, if we were to accept the amendment that was turned down, is that quite

[ Page 6261 ]

possibly any property transfer in any area in British Columbia covered by an aboriginal claim would have a caveat suggesting that there was some question about the title of that property. That is the reason this government has rejected the call for that kind of caveat on the property.

If we're led to believe — and I believe that members across the way are sincere — that what you're talking about is the Musqueams' ability to claim compensation as opposed to obtaining title to the lands known as the UEL, then I don't believe we're doing anything that would stop a compensation claim being made to the federal government. If the federal government wishes to acknowledge their claim and if they wish to enter into a settlement with them, so be it.

Yesterday the first member for Victoria (Mr. G. Hanson) read a statement which indicated the Musqueams had no interest or did not wish to have the park used for any other purpose. As I understood the statement that was read in the House yesterday, Mr. Member — and he frowns — it was an indication that the Musqueam did not oppose the preservation of a park. Therefore the only logic could then be to look for compensation. I suggest they're still quite able to do that.

MR. GUNO: I want first to apologize for some of the heat I threw earlier.

I want to respond to the last speaker, whose contention that the Musqueam people's application for comprehensive claim status has been refused is not true. The crux of the matter we're discussing today is their ability to somehow come under the umbrella of the federal government's claims policy, which states that their claim or application can be thwarted if the area they're claiming is superseded by law. The passing of this bill does exactly that. So it's not that their claim has been refused; it's still under consideration. I would suggest very strongly that this bill, in effect, does prejudice that application.

As for your explanation about a caveat, that these spring up almost automatically when you're talking about land claims, I suggest that you do a little more analysis of the whole claims process.

There are really two ways to deal with land claims. The first one is through litigation; unfortunately, that's the route this government chooses to follow. The second one is negotiation. I think that if the government are serious in entering this new era of consultation with the native people, they will find that once they understand the basis of much of the aboriginal people's claims, it's not the 125 percent the Premier talked about yesterday; it's not the huge land transfer that your government continually throws up as a way to scare away any opportunity for really dealing with this in a realistic and rational way.

That's why I'm really disappointed to see that this government did not at least consider an opportunity to preserve the right of the Musqueam people to pursue their claim. It's a simple question of justice. I would think the member, if he's going to be credible as the Minister Responsible for Native Affairs, had better do a fairly comprehensive study of the whole matter. It's complex; it's not as simple as you have portrayed it.

[4:00]

MR. CHAIRMAN: Just before we proceed, hon. members, and with all due deference to the sincere feelings that I know prevail in those who stand to speak, I would just like to remind everybody that we cannot re-enter second reading debate and that we are, in effect, dealing with a section of this act which deals with conditions of transfer.

Having said that, is there anyone else who would like to speak?

Section 3 approved on the following division:

YEAS — 29

NAYS — 19

Sections 4 and 5 approved.

Title approved.

HON. MR. DIRKS: I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Speaker in the chair.

Bill 16, University Endowment Land Park Act, reported complete without amendment, read a third time and passed on the following division:

[ Page 6262 ]

YEAS — 46

NAYS — 2

HON. MR. STRACHAN: I call Committee of Supply.

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

ESTIMATES: MINISTRY OF
GOVERNMENT MANAGEMENT SERVICES

On vote 31: minister's office, $259,265 (continued).

MR. WILLIAMS: I quickly scanned the list the minister gave us today where he indicated by code how many were full competitive sales. We're talking about 72 land sales by the Enterprise Corporation. There was one call for competitive proposals out of 72. That was for the Expo lands, which we're all familiar with. Four of the 72 were tender calls; 60 were listed as advertised sales and negotiated, whatever that means. It's not a good batting average: 83 percent of the sales for all these different lands were not full tender calls. Maybe the minister can give us explanations for some of these which I find difficult.

In Whistler there is reference to a previous ski area agreement commitment. I don't know whether that's with the mountain development group and the lift group or not. Maybe the minister could advise us. There's a series of sales at Whistler in the town centre to Bosa Bros., CP Hotels and a range of other companies — at relatively modest prices, at very low prices.

There's the reference to the previous ski area agreement, which I gather was a commitment that required a fixed price, in effect, or a fixed price per acre. I simply don't know. Maybe the minister could advise the House what those arrangements were in Whistler. You state in here: "All sales were pursuant to standing option under ski area agreement initiated by Lands, Parks and Housing;" and: "Sales prices reflect base acreage values plus a share of revenues under the ski area agreement." It's that agreement that may enlighten us.

[Mr. Rogers in the chair.]

HON. MR. MICHAEL: I'm not familiar with that particular sale. I would think, from listening to what you've said, the question would probably be better asked under the estimates of the Minister of Crown Lands (Hon. Mr. Dirks) rather than my own. It was clearly done before my time, and, from what I can understand from listening to the point that you've made, it was made by that ministry.

[4:15]

MR. WILLIAMS: That's all very well. I can understand the point the minister makes, but, for example, there was a sale to CP Hotels of lots 7 and 12 at Whistler. I've seen some general plans of the town centre, and I think the site is immediately behind the Delta Mountain Inn. It's ten acres. These are fabulous values in the Whistler town centre. The Japanese bought out Al and Nancy Raine, for example, at a very high price, and other offshore people have bought in downtown Whistler. Ten acres at $275,000....

AN HON. MEMBER: How much?

MR. WILLIAMS: To be precise, $275,791 — for ten acres in downtown Whistler. There's some arrangement in terms of revenues under the ski area agreement, and that might be some other revenue for the Crown. The pattern is consistent: two acres to Bosa Bros. for $82,000; another 7.7 acres to Bosa Bros. for $209,000; United Properties, 3.8 acres, $85,000; Craftsman Ventures, 2.82 acres, $47,000; Crestview Realty, 1.5 acres, $34,000; Craftsman Ventures again, 4.1 acres, $119,000; and Bosa again, 1.7 acres, $175,000.

All of those really deserve some analysis and supporting information, because those are incredibly low prices in downtown Whistler. If you try to buy a condo in Whistler now, you pay a very high amount. There are others here too: Brandywine Properties....

AN HON. MEMBER: How much an acre?

MR. WILLIAMS: In the case of CP Hotels, we're talking about $27,000 an acre. We all know how expensive property is in downtown Whistler.

It's kind of interesting to reflect on that, because I was minister at the time we made the decision to establish the town centre and the new lifts on the mountain. It was a garbage dump owned by the Crown, and we had to establish a berm next to the creek to protect it from flooding in the future. We were able to design the lifts so that the focus of value was all in the town centre site: two lifts, one toward Whistler and one up.... What's the other mountain called? No skiers here?

MR. CHAIRMAN: Blackcomb.

MR. WILLIAMS: Thank you. What would I do without the Chairman?

It was an interesting exercise. We had snow engineering from Colorado come in and look at the

[ Page 6263 ]

snow situation. There was this wonderful opportunity to focus all the lifts on the old garbage dump and also tie in with the old Whistler complex itself. It's a marvellous design solution in terms of establishing the town centre, but again at this point, it's the time of payoff in terms of all these investments. So the question is the background in that.

I find myself looking at the sales in Songhees, for example. I said last week that it was interesting to compare Songhees with New Westminster, because the differences were so significant. But I think if you look at Songhees carefully, that deserves some real analysis too.

I don't know if you've checked the local newspapers, Mr. Minister, but the standard price now in Songhees — the member for Victoria would know, I'm sure — is running about $235,000 a suite. If you put a basic square-foot cost to a suite, it isn't uncommon to think in terms of $65 to $70 a square foot for a fairly good frame condo, and that's essentially what they are. The land sale price, though, would have run at about $18,000 a suite when the deal was made, plus the amount to construct. You, Mr. Minister, said that in this case all the servicing was in for sure, so that wasn't a cost for the poor fellow — or now a rich fellow — who bought the site. If we're even conservative, what are we talking about there in terms of some new residual land value? Is it $75,000 a suite probably? Is that reasonable?

Interjection.

MR. WILLIAMS: No, it's not reasonable; that's the trouble. Nothing you guys do is reasonable.

I wonder if the minister might be willing to work this one through with me. When I was looking at a pad just a few minutes ago, I thought: let's try and come up with a residual land value on the Cavell property site right here in Songhees that's for sale right now. Any thoughts on that, Mr. Minister?

HON. MR. MICHAEL: I wonder — just deviating somewhat for a minute — if the member could indicate to me whether he has obtained a copy of the statement of claim regarding the property in New Westminster we were discussing before lunch? Has he obtained a copy of the statement of claim? We referred to a court case, and I was wondering if your research people had found a statement of claim.

MR. WILLIAMS: No.

HON. MR. MICHAEL: I appreciate the response though, Mr. Member. It's just a matter of attempting to work together to clear up questions and points that have been raised by the member opposite. Without getting into a debate or being prepared to answer detailed questions regarding the debate we had earlier that the member was quite hot on, I would be prepared to send to the member a copy of the statement of claim.

Regarding the property in Songhees. Once again, Mr. Chairman, I don't want to sound like a broken record, but properties.... Again, I could check as I have in other instances and provided information to the member on the extent of the advertising that took place and the precise method of selling. But if he wishes me to do that, I could repeat that.

But suffice it to say, the market is the market is the market. As long as we have a sufficient number of participants in the marketplace that are interested, the staff do an adjudication of valuation of what they feel the market will bear. If the results come in in that range, they obviously were satisfied. Recommendations then go to the board of directors for authorization for final approval. That obviously was done in the instance to which the member refers.

I want to say for the record that I obviously was having a discussion with my staff prior to lunch, when the member for New Westminster (Ms. A. Hagen) was speaking. A statement that she made was drawn to my attention during the lunch period. Whether she's listening now or not, I would ask that member to perhaps go to the trouble of reading the statement of claim that I have sent over to the first member for Vancouver East and return to the Legislature and give considerations about the statements that she made which are contained on page 14 of the Blues. That statement is: "I've listened with great interest to the skilled presentation of my colleague for Vancouver East about the facts of a corrupt land sale in New Westminster, where the public was defrauded of money that it should have had."

I would ask that member, Mr. Chairman, if she would be kind enough to review the statement of claim, to read it thoroughly and give consideration to returning to the Legislative Assembly and offering apology to this government and to the staff involved in that transaction.

MR. CHAIRMAN: Order, please. I think the opportunity to ask for this type of a statement was at the time that the event took place. I have given the minister some liberty, but I would ask you now to return to the estimates. This is not the proper procedure for doing this. Members of the executive council are not at liberty to ask questions of the members of the opposition.

MR. WILLIAMS: Back to the Songhees area. The sale was for $2 million. It was in fact then a $20,000 land cost per suite in terms of the Cavell sale. The current prices over there are around $235,000 a suite. The suites are running about 1,000 square feet. Even if we said $100 a square foot for construction costs, that would then be $100,000. Put down $20,000 as land cost originally — there might well be some other site costs beyond utilities, since you've said utilities and infrastructure were essentially paid for by the Enterprise Corporation in this case. Even being very conservative and allowing another $20,000 or $30,000 per suite for sales cost and the like, that gets us up to $150,000. They're selling at $235,000, and I think I am being generous. Does that mean we are talking about $80,000 a suite in terms of profit, which in this case would be $8 million again?

[ Page 6264 ]

Interjection.

MR. WILLIAMS: I think I am being conservative, Mr. Minister. I think this is a rational process to go through. My figure of $100 a square foot is not what you would pay in a frame building at all; the numbers are more about $65.

AN HON. MEMBER: $80.

MR. WILLIAMS: Okay, $80. I'm willing to concede to an expert. I've even given it $100 — to throw $20,000 around just to let it slide here or there, one way or the other.

Interjection.

MR. WILLIAMS: Yes, it looks like a number perilously close to and pushing towards $100,000 a unit.

I've seen a lot in the politics of this province in my time and I have seen some pretty dumb things done by government. I've seen scandalous things done by government. As I begin to go through this list of Enterprise Corporation sales, I'm beginning to think I have never seen the likes of it before.

What kind of justification can there be for this kind of fire sale game? The Songhees was the most beautiful undeveloped residential land in Victoria, our capital city. It is water frontage that looks out on the Empress Hotel and the parliament buildings and is within walking distance to downtown, and a waterfront walkway in front of it. It's absolutely splendid.

[4:30]

On a per-unit basis it's better than the New Westminster deal. It just shakes you. You just wonder when amateur night will ever end. I just had another look at LRO documents. This one was so sweet they didn't want to flip it. I don't blame them. There was so much money to be made here they didn't even try to flip this one.

I see that they got $15,206,441 from the Standard Trust Co. on this one. That probably takes care of an inflated land value for the principals in Cavell Developments — of what dimension, I couldn't say, but I think it would be substantial. Part of that mortgage agreement with Standard Trust lets them all share the profits. That's sweeter than paying an interest rate. Standard Trust, again, like the Bank of America and the Canadian Imperial Bank of Commerce, knew what it was doing.

AN HON. MEMBER: An American company?

MR. WILLIAMS: It's Standard Trust Co., at 69 Yonge Street in Toronto, Ontario.

If we accept those numbers and it's 100 units, that puts us at around $152,000 per unit, which probably includes an inflated land price for the principals in the Cavell company, which will no doubt be significant. Even after going through that exercise, we're still talking about the difference between $152,000 and $235,000, which again gets us up around $80,000 per unit, from which you have to deduct sales costs and maybe a little bit. But what we're talking about is something up there around $7 million or $8 million in a very short period of time.

On this one I'm just going from LRO data available to everybody. We've been generous in terms of what we think unit costs are per square foot of building in this town. You, Mr. Minister, have the privatization staff and part of your ministry with you. They're so busy off-loading these great Crown assets that they haven't stopped to look backward to see what kind of mess they've created or what kind of mistakes they've made along the way, and it seems clear that they're abundant.

You said this morning that they will be making announcements about privatization of more Crown assets in the next week or two — within two weeks. I don't think we can afford it. Don't sell anything, and our credit rating will go up. Don't sell a thing. Hold on to it, because it's probably worth ten times what you're selling it for. Don't do it. It's now clear that we can't afford this anymore. I just wonder if your staff has done any backward looking, any reflection. Have none of them stopped and looked to see if there was a flip along the way? Has none of that work been done? Maybe you could bring us up to date.

HON. MR. MICHAEL: I did indeed send a copy of the statement of claim over to the member, and I have to assume that he has not had time to read it, review it or glance at it. Perhaps if he wishes to send a copy down to his research staff, they could quickly give him a summary of the contents. It might ease his great concern regarding "Flipco." There are a lot of answers in that document, Mr. Member.

I see that the second member for Boundary-Similkameen (Mr. Barlee) is present in the assembly today. I will see that he also receives a personal copy, because I know he has sat in this chamber for many hours and shown a great deal of interest in the statements made by the first member for Vancouver East.

I have to say that I have a great deal of sympathy for the box that the member for Vancouver East is in. He's got a lot of problems, and his party's got a lot of problems. I will say at the outset that I sincerely congratulate that member for what he did back in the early seventies regarding Whistler. It was good, sound judgment and one of the things — and I emphasize the word one — during those glorious years that he can look back on and hold his head high about. He must feel pretty good about that. I'm sure you think about that a lot and talk to your colleagues about that tremendous decision you made regarding Whistler in those years, because it was a good decision, and I compliment the member. If we chose to, there are a lot of other things we could reflect on that weren't all that glorious, but I don't know whether we want to get into all those areas here today, because the clock is ticking and time is going by. Suffice it to say: a great decision.

Even though members of his party were under full throttle attack on our government back in 1982-83 when we had to step into the Whistler situation, make some very tough decisions and back them up with a substantive guarantee to pull them out of the

[ Page 6265 ]

mess that developed during those years, I am sure the member would agree that this government, in retrospect, did the right thing back in 1982. I certainly remember it being a very high issue in the '83 campaign: the dumb decisions of this government in bailing out the Whistler corporation. I know the frustration that the member must be going through when he examines the record. He looks at the performance of this government and of the Whistler corporation in 1987, and he sees $150 million of economic activity in that small community in one single year. It must be disheartening for him not to be receiving the credit, knowing full well that it's the government that deserves the credit for that tremendous construction boom in 1987. He must also be somewhat saddened by the fact that a repeat performance took place in that community in 1988 — another $150 million of capital spent in the province of British Columbia with tremendous spinoff effects, providing facilities for thousands of tourists worldwide to visit that great community. I give that member credit in some small measure, or perhaps significant measure, for the decisions that were made back in the early seventies.

I am sure that in looking at the current year the member is distraught. There is no question that he is in pain because he knows full well that in the year 1989 the projections are that there will be somewhere in the neighbourhood of $300 million, equal to the previous two years of capital, spent in the Whistler community. That doesn't sit well. The NDP members aren't happy when things are going well in the province. They are not happy when there are all kinds of new buildings going up, people working, taxes being paid, capital being circulated, revenue coming into the provincial government, new programs being announced, bridges, highways, education grants and university grants and positive things happening in the area of health with new hospital construction, and increases given to workers above the cost of living. They're not happy with that. It breaks their hearts to see those good things happening in our province.

So I have some empathy and some feeling for the member. He's got to grab onto something. He goes back in the records and starts looking through, picking out individual things and trying to relate the facts of what they were sold for a few years ago. In some instances he goes back as early as the seventies to some of the things we've gathered that now affect the corporations which I am in charge of, which indeed originated back in the seventies, and decisions made then — right decisions. This province needed economic generators. We needed development. We needed to put people to work. We needed economic activity.

I repeat that I do not wish to sound like a broken record, but we have professional staff, a corporation made up of top people analyzing and evaluating pieces of property. We have a committee that reports to the Minister Responsible for Crown Lands (Hon. Mr. Dirks). The committee is made up of, again, high profile, top-notch people who review the process. They review each and every sale. They thoroughly analyze the proposals from the proponents. They make recommendations after a thorough analysis. I stand here quite satisfied and convinced that, taking all factors and all matters into consideration, the staff recommendations and the board decisions have been correct at the time the decisions were made.

I repeat that I trust the member will see fit to have a review of the statement of claim that we've referred to. Read it over, and be sure to give a copy to the member for New Westminster (Ms. A. Hagen), because I am sure that once the member has had an opportunity to read the statement of claim she will see fit to return to the assembly.

MR. WILLIAMS: It was nice to hear the stump speech from Anglemont, Celista or Sorrento, but I don't know....

Interjection.

MR. WILLIAMS: I'm not insulting them; I think they are marvellous. They may occasionally vote a way that I don't admire too much, but beyond that they are good people.

I am intrigued. I listened fairly carefully, although when the bull gets so deep, you kind of withdraw. Cavell Developments was what I asked you about, Mr. Minister. I don't remember your responding on that one.

AN HON. MEMBER: Were you listening?

MR. WILLIAMS: Oh, I was listening.

I went through trying to come up with residual land value numbers and.... Maybe we could deal with these code numbers that you've used on the various land sales. It's clear that the majority of them are what your staff call "listed advertised sales" where lands are listed or advertised for sale, and the final terms are negotiated. It's not clear to me what that means. Does that mean that in some cases you would simply advertise that lot x is for sale, and you wouldn't put a price on it?

HON. MR. MICHAEL: I think it's reasonable to say — and I repeat — that we have a competent staff of professional people in the field. They know what the parameters are to which they can work on individual parcels that are put on the marketplace. Suffice it to say, some offers come in with all kinds of subject-to clauses in them that may mean that the transaction would not complete for many months or years in the future. That particular situation may not fit the parameters to which the lands committee is working toward.

[4:45]

We attempt to lay out as much information as we can when proposals are put to the marketplace. I know that the member opposite is very much aware of what these proposals look like. I know he is aware of that, because we are aware that the NDP caucus has seen fit to spend $500. We thank you for that investment, on behalf of the B.C. Enterprise Corporation, and for picking up a parcel for the Westwood

[ Page 6266 ]

properties. You know how thorough and detailed the packages are that you pick up.

We understand you've also picked one up just recently for the parcel up in Whistler. Thank you very much again, on behalf of the government and the Crown corporation. We are sort of recycling the money here. I'm sure that you're familiar with that as well, and you know the detail and the trouble we go to. I have no doubt that you are going to witness some announcements from my ministry or from the Minister Responsible for Crown Lands in the next two, three, four, five or six weeks on the Whistler lot in which you've expressed interest.

You're going to see an announcement made — hopefully before the next few weeks, but certainly within the next few weeks — on the Westwood Plateau. No doubt we'll hear the drums, the shouts and the hails as to the extremely good price that we got for these properties in April and May of 1989 — extremely high prices.

I would suggest to you, Mr. Member, that if it hadn't been for the foresight of previous ministries and previous officials of government to put some property in the marketplace at very reasonably priced levels to attract investors in order to get facilities such as Whistler underway, we would not have the great infrastructure, the great investment or the great tourism in that community that we have now.

Someone had vision. Someone could see the great opportunities of the future. They knew what Whistler meant to the international skiers. I'm not sure if the member is aware that Whistler has grown so dramatically in the last couple of years that it has jumped from the seventh largest ski resort on the North American continent in early 1988 to today when they are in third place in North America. I expect that in the early part of the 1990s, we will see Whistler grow even further into the second position.

I congratulate once again — and I'm serious when I say this — the first member for Vancouver East for being part of the process of making the Whistler corporation happen. He deserves compliments for that, and I'm sure he's proud of that.

We don't want to talk about some of the other things that happened in British Columbia in 1972 to 1975, nor do we want to waste the time of the ministry's estimates in talking about the variety of failures and doomsday events that have taken place in Saskatchewan and Manitoba and other jurisdictions. We don't want to take up the time of the House reviewing some of those dismal failures. We don't want to talk about the Mineral Royalties Act of 1974. We don't want to talk about Norman Levi's overrun. We don't want to talk about Jim Lorimer's comments on public transit, or about the agricultural blunders and Panco Poultry and all those types of things. We don't want to take up the time of the House on those areas.

I know the frustration. I know how sad that member must be, and indeed all members opposite, in looking over what's happening in the great province of British Columbia in every corner — on the Island, in the north, in the south and in the interior — the progress, the spirit of confidence.

The member must have picked up a bit of those vibes when he visited the great community of Sicamous last weekend. I'm sure he had a feel of the confidence being expressed by that great community. That community, by the way, is giving serious consideration to incorporation. We're working with the Minister of Highways (Hon. Mr. Vant), and I think we may have some positive announcements for that community in the next little while.

I know how sad he must be. It must really give a great deal of pain to be able to go across the province and through the lower mainland, to see announcements being made, to see positive developments, to see British Columbia leading all of Canada, to see that this province has attracted four times as many people in 1988 from the province of Ontario — that province we hear so much about — as compared to British Columbians moving to Ontario.

He must be saddened indeed in looking at the statistics from the Minister of Tourism (Hon. Mr. Reid), statistics that clearly show a 13 percent growth over last year. The tourism of 1988 has exceeded the tourist figures in that great year of 1986 when this province hosted the world exposition. I wonder where this province would be today had the government of the day listened to that former mayor of the city of Vancouver who sent telegrams all over the world advising against Expo coming to the great city of Vancouver.

I don't want to take time up with those types of things, but I'll be interested in hearing other areas that the member may wish to cover in this very exciting ministry covering lots of Crown corporations. There seems to be one particular one that the member is more interested in than the others, but that's all right. We're here to answer the questions, Mr. Member.

MR. BARLEE: I would like to ask the minister why in the Songhees development the average profit.... About the average profit, I think the first member for Vancouver East (Mr. Williams) was extremely generous. You can probably assume that it's going to cost $80 a square foot, not $100 a square foot, and that average unit price would realize $105,000 per unit. Now there are 100 units being developed in that area. This would mean that the entrepreneurs make a net profit of $10.5 million. As a relatively new member to the House, I would wonder why this would not accrue to the province rather than a handful of so-called entrepreneurs?

HON. MR. MICHAEL: I sincerely appreciate the member's involving himself in the debate today. It's good to see a member from the interior, the south Okanagan, taking an interest in things that are happening in the lower mainland and on Vancouver Island.

However, for the record, I cannot accept the figures that the member has stated. They may or may not be right. I have no way of instantly validating those figures. But suffice it to say that we are interested in fair-market value at the time of sale. We hear

[ Page 6267 ]

a lot of debate and a lot of comments made in the House about the tremendous amount of money that developers make. It's strange, Mr. Chairman, that we never hear any comments or suggestions or speeches on the great deal of money that developers lose. I can tell you, there are a lot of losers out there in the marketplace.

MR. BARLEE: I've lost some.

HON. MR. MICHAEL: Yes, the member says he's lost some. I can reciprocate by saying that I too have been in that game and lost some. So you win some, you lose some.

The facts are that property is advertised; trained professional staff analyze, adjudicate, recommend; and markets change. Who would have ever predicted that the average selling price in the city of Vancouver in just 12 short months...?

MR. WILLIAMS: Who indeed?

HON. MR. MICHAEL: Who indeed would have ever predicted? I'm sure the member for Vancouver East would still be the proud owner of all those Hemlock Street properties if he could have had the vision as to where they might be in 1989. I also often wonder, in reflecting on Hemlock Street, how poor old Malcolm MacLean ever made out, where he ever landed. But suffice it to say that life goes on. Values go up and values go down and the world continues.

MR. WILLIAMS: That's right. For you they go down, for me they go up.

HON. MR. MICHAEL: Well, there you go. That's the breaks. I'm saddened by that too. The mistake a lot of people made is perhaps not investing more money in the lower mainland, because the market's hot down there. Even pubs are selling for a pretty good price right now.

You have to make decisions. But all in all I'm confident and indeed proud of the staff of the B.C. Enterprise Corporation. They put in a lot of hours on behalf of the citizens of the province; and, yes, they get paid good money for it as well.

There can be criticism indeed of the sales prices, when reflecting and looking at 1987 prices and seeing where we are in 1989. But I ask the member and the members opposite: who would have believed that the average selling price of houses would have grown by some 60, 70, 80, in some instances 90 percent in just 12 short months? That's the marketplace.

MR. WILLIAMS: The minister refers to the land committee that adjudicates these things. Maybe he could give us some more details about who's on the committee and what their expertise is.

HON. MR. MICHAEL: Mr. Chairman, we have three cabinet ministers on the board of directors of the B.C. Enterprise Corporation. I as the member responsible for the Crown corporation am the chairman and president. We have structured the corporation in such a way.... It's unfortunate that the member did not take the liberty, as did his predecessor, of doing a tour and having a personal meeting with the staff, to have a better understanding of how the system works within the corporation.

I act as the chairman and oversee personnel matters, administration and the comptrolling division. The direct line and responsibility of the Minister of Finance (Hon. Mr. Couvelier), subject always to the approval of the board, is the disposition and sale of the loans portfolios. Any questions dealing with the sale of loans portfolios should, of course, be directed to the Minister of Finance, as I said earlier. The Minister Responsible for Crown Lands (Hon. Mr. Dirks) has a direct responsibility for land disposition. I as the chairman and president of the corporation oversee to a degree the framework, the structuring, the policy and, of course, personnel matters. But on specific matters dealing with the Minister Responsible for Crown Lands, I would ask the member to perhaps save those questions, and he'll have an opportunity to ask questions during that minister's estimates.

MR. WILLIAMS: I think I asked who was on the lands committee and how disposition was handled, and we got a dissertation on the Ministry of Finance and disposition of loans. Then we got something about how the minister operates as the chairman of the Enterprise Corporation. Is the lands committee not a part of the activities within your ministry? Is that what you were saying?

HON. MR. MICHAEL: Mr. Chairman, the lands committee reports to the Minister Responsible for Crown Lands.

MR. BARLEE: Mr. Minister, I'm rather curious about the amount of money that CP Hotels paid for the ten acres in Whistler. It works out to $270,000-odd dollars for ten acres, so approximately $27,000 per acre. I just purchased a lot in Penticton, which is certainly not as high-profile as Whistler. I paid $35,000 for a fifth of an acre, and that works out to $175,000 an acre. Here's CP Hotels — who probably have much deeper pockets than I have — and they've only paid $27,000 an acre in an area that's extremely desirable. The same type of land in Penticton is $175,000 an acre, and certainly can't be as valuable. Why the huge discrepancy?

[5:00]

HON. MR. MICHAEL: Mr. Chairman, I would have to bow and ask the member for Boundary-Similkameen if he would be good enough to keep that question and put it to the Minister Responsible for Crown Lands. It's clearly under his jurisdiction, and it suggested that in the document that has been circulated. I am sure the member has shared it with you.

MR. CHAIRMAN: Before we proceed, in order to assist the committee, the Chair has examined Parliamentary Practice in British Columbia. I am not familiar with who the minister was at the time these various

[ Page 6268 ]

transactions took place. Therefore it is left to the Chair to receive instructions from others.

Questions of a new minister relating to the actions of a former minister occupying the same portfolio are out of order. If these various operations took place when this minister was responsible, then they are in order. I take advice from the minister on the reorganization of the government and on which ministries have responsibility for which departments. It's quite confusing.

MR. WILLIAMS: The difficulty I have in terms of the Whistler arrangement — presumably it is still operative; not everything is complete there — is understanding the nature of it. I would think that your ministry would at least have an understanding of the nature of your inherited agreements there. Clearly those transactions involve the B.C. Enterprise Corporation. I would presume you are constrained by previous contractual arrangements. Understanding that constraint is the concern over here. It's hard to fathom why there wouldn't be an understanding within your ministry of what that constraint was. While they may well have been inherited from the Ministry of Lands, the transactions nevertheless took place at the B.C. Enterprise Corporation.

I chair the board of a major financial institution, when I'm doing more productive work. Any transactions such as this certainly would get my review, I assure you. If there were such an agreement with some subsidiary, or some previous contractual arrangement, and we were selling those assets, I can assure you that I would want to understand them thoroughly before I allowed the transactions to take place. I find it hard to believe that there isn't an understanding of those agreements and arrangements. Maybe you could get briefed by your staff so we could understand them, and so that in the future, when you are dealing with any further dispositions at Whistler during the term of your administration, we would understand thoroughly what the process is and how you are sticking to the rules of the contracts.

HON. MR. MICHAEL: I'm sure the member will engage in a deep analysis and discussion with the minister when his estimates are before the House. The thing I have to pass on to the member is that when the decision was made to unwind the B.C. Enterprise Corporation, there was a very onerous workload laid on the three cabinet ministers who were appointed to the board of directors — a tremendously onerous responsibility and a great deal of work.

As in all management decisions, Mr. Member, there is the question of organization and areas of responsibility. Rather than putting the entire burden on a single minister, who already has under his jurisdiction such things as the government personnel services division, which is very heavily engaged in the negotiation of several union contracts, and all of the benefit packages, and the Superannuation Commission.... He is also responsible for the Purchasing Commission and all of the exciting things going on there, and the great amount of work that has to be done. Lots of it has been done and more is being done. Very exciting announcements are about to be made as a result of the Purchasing Commission, Mr. Member. We are going to have some very exciting, environmentally sound recommendations going to cabinet next Wednesday which will be announced shortly thereafter. I am sure the member will be pleased with the work brought about by the employees of the Purchasing Commission.

Other areas of responsibility are the B.C. Systems Corporation — several hundred employees and a great deal of exciting things happening; the B.C. Buildings Corporation; government vehicles and airplanes, the Challenger....

Rather than putting all of the responsibilities of the BCEC on one single ministry, it was a wise decision that the three cabinet ministers on the board would share the responsibilities. The decision was made. Finance — and this sort of makes sense if you think about it in hindsight — looked after finance. He looked after the loans portfolio.

Then think about it. The other person was on the Crown lands — and I emphasize the word "lands." It was decided that that minister would be responsible for land disposition, the idea being that he would set up a land committee made up of "experts" who would determine and make recommendations to him onward to the board on future and current sales. At the same time, it would be very convenient and logical that being the minister of lands in charge of land disposition, it would also follow through that any unsold properties during the wind-down of the B.C. Enterprise Corporation would be transferred to Crown Lands, as is being done now.

I've perhaps overstepped my area of responsibility in getting as deeply as I have in previous land sales. I've tried to be cooperative. I've tried to deliver as much information as I possibly could to the member. I have also delivered to the member and to the member for Boundary-Similkameen the statement of claim. I am extremely surprised, after having read that document, that the first member for Vancouver East states that he had not received it or read it before. It would almost indicate to me from some of the questioning that if he hadn't read it, it certainly appeared that he had previous knowledge. He says no, and I believe him. It's interesting, I'm sure. The member would agree it's interesting. If he hasn't read it yet, I'm looking forward to him analyzing and scrutinizing.

I should have perhaps highlighted a few of the items there for the member, because there are certain areas there, if he wishes to flip through very quickly to page 6 and 7 and have a quick glance, that might satisfy him. It might be very interesting for him to just take a bit of time — have a rest — perhaps turn over the questions to some of the other members and take a five-minute break. It's a very easy to read document. It may ease his concerns somewhat.

MR. WILLIAMS: Since he doesn't want to discuss BCEC for a little while — he really wants a breather, I

[ Page 6269 ]

think he's saying, and I don't blame him — let's talk about the airplane for a minute. The Challenger. How much was it: $9 million, $7 million, $8 million?

HON. MR. MICHAEL: $7.5 million.

MR. WILLIAMS: A mere pittance — $7.5 million. Something you could have made in a flip overnight. I'm just reflecting.... I was in this chamber in earlier days when there was a man by the name of Gaglardi who for some reason has come back in his second life as mayor of Kamloops. At any rate, he had quite a reputation for using these aircraft frequently and for a range of uses. I think it was reasonable to say there was a certain amount of abuse in the use of those aircraft for personal purposes.

As a result, subsequent ministers always deposited the logs of the aircraft with the House when they got up for their estimates — that is, annually, Mr. Chairman. I'm sure you would recall that, Mr. Chairman, because you have a very good memory about these things. You're just about the same age as me.

When Mr. Gaglardi was the minister, there was a certain amount of abuse of the aircraft. I'm not one to suggest that that would ever happen nowadays. The point is that subsequent ministers always deposited the logs in the House so that we saw just who flew where.

MR. LOVICK: Something like a log squad.

[Mr. Barlee in the chair.]

MR. WILLIAMS: Yes, kind of a log squad, as a matter of fact. That's an interesting phrase. I just wonder if the minister might do the same as other ministers have done probably for about a decade. The logs of the aircraft were filed with the House. We could just see who's there every night on the evening flight to Richmond, and that sort of thing. It's a reasonable idea tabling the logs in the House, particularly this new Challenger jet that cost us only a mere $7.5 million. It would be interesting to see how well that's being used and by whom it's being used.

Will the minister entertain that proposal and carry on the tradition of the more thoughtful ministers with that responsibility by providing the House with that kind of information?

HON. MR. MICHAEL: I will give that matter serious consideration, and I want the member to know.... I don't think the first member for Vancouver East was in the House the other day when we were on this subject, and I don't think he's aware of the great deal the government got in negotiating for that airplane.

MR. WILLIAMS: Such a bargain.

HON. MR. MICHAEL: According to the advice of the Chairman, Mr. Member, I shouldn't even be debating this or answering questions on this subject, because it was the action of a previous minister.

But suffice it to say, the negotiated purchase price — if I'm fairly accurate in my memory here — was $7.2 million. I am advised by good advisers that we could sell that plane today for in excess of $10 million — not too bad. Along with that . . . . I have to repeat this. It was said the other day, but I want to repeat it, because I don't think the member was present when these words were said, and he may have missed it in reading the Blues. I know he would have gone over them thoroughly; he reads the Blues every night, but he may have missed this part of it.

[5:15]

The province has received in excess of $14 million in purchases as part of the offset agreement negotiated by the previous minister. I believe the precise figure is $14.5 million in offset purchases being made by Canadair in British Columbia as a result of the offset agreements negotiated by the previous minister. I'm sure the member would be even more pleased to know that as a result of that agreement, there was a commitment in the vicinity of $14 million; but, in fact, if you look at the projections and current sales, that figure is going to significantly exceed $20 million in the next few years — not too bad a deal for that particular airplane.

MR. WILLIAMS: The minister was on a school board back there in old Salmon Arm, and I can just see what a tremendous job he must have done when he was in that there school board. I mean, a $7.5 million deal for a plane, and they've spent $14 million in British Columbia. That number work is impressive indeed. It may win a vote or two in Anglemont, you never know. I'd try it there for size before I tried to fly it around here. Gee whiz!

Fourteen million dollars in expenditures. What kind of expenditures? Maybe you could elaborate. Maybe your staff have.... I think in that bundle we haven't got answers to some other things, but maybe we have this one. It would be absolutely fascinating to get that background and the justification for this executive jet. I don't know that you even have an airport in Salmon Arm where that jet could land.

HON. MR. MICHAEL: Yes, they have.

MR. WILLIAMS: When did they build it? It would go smack into Mount Ida or Fly Hill over on the other side. Haven't you been in Salmon Arm? Fly Hill is right nearby, Mount Ida is right there and that old burn is there by the Salmon River. I've been there many times. I find it hard to believe the Challenger could land there. If it did, I think there would be gravel all over the whole darned town, to tell the truth. It would just splatter rocks all over that Pronto, or whatever that fancy car is the minister has sitting there idle and waiting for him.

If the list is there, we're certainly interested.

HON. MR. MICHAEL: I somewhat resent the inferences. Maybe it has to do with the pronunciation of good old Salmon Arm. It's a bit downgrading, and I hope the member doesn't mean it in that light. The same goes for the reference to Anglemont. Angle-

[ Page 6270 ]

mont, if you've ever been there, is one of the greatest retirement communities in the province. I might add that the community of Anglemont, through its own efforts and with a little assistance from the MLA, has built one of the greatest seniors' facilities — a seniors' hall — anywhere in the province. Great facilities and a great bunch of people.

Interjections.

HON. MR. MICHAEL: Yes, they do have a very small airport, and the member has seen it. It's one of the most interesting airports in British Columbia. Yes, we have an airport in Salmon Arm, and yes, we have an industrial park too. I don't want to get into the location: up on the top of a hill several miles from a railway siding or any access to rail. We know who planned that, whose great contribution to the community that was and how that came about.

The B.C. offsets. We have a list of purchases made. Two main companies in British Columbia have benefited from this agreement: Canadian Aircraft Products and Ebco Industries. These two firms have received several contracts from Canadair, and the precise value of the current purchases and future commitments, up to and including 1998, is $22,384,115. The items purchased were forward fuel tanks for CL-600 Challenger aircraft. That purchase was made in May 1988, and its value was $1,237,500.

As I said earlier, a lot of these purchases are already complete. We will complete another purchase in May '88, a third one in May '88, and a fourth one in January '89. All four are with Canadian Aircraft Products. The last one — the one that concluded in January '89 — is the nest buy for the above three items; that was $7,140,500 in total. The other items on the page are all with Ebco Industries — indeed, deals, purchases already completed. There were two in February 1989 totalling in excess of a million dollars. Then there is a ten-year supply of machine parts for an airbus program. In January 1989, another $764,000. The figure grows from $801,000 in 1990 to $1,012,764 in 1995, and it finishes in 1998 at $1,165,714.

All in all, I'm pleased we were able to respond so quickly to the member's question to show him the great economic spinoffs, the offsets, as a result of this agreement.

MR. LOVICK: Just to pursue that matter, of that total spending on what are called offsets, would the minister clarify how much is specifically related to that particular aircraft and no other kind of aircraft?

HON. MR. MICHAEL: As far as I know, Mr. Member, the answer — if I understand the question correctly — is either zero or close to zero. There was nothing to say that the products being purchased in British Columbia had to be put on the plane in B.C. It was an offset agreement. Some of the items, or part of the supplies, could well be utilized on that airplane; but that's much in the future, and it would be conjecture to suggest that some parts being manufactured here would be put on that airplane.

To my knowledge, there is no suggestion whatsoever in the offset agreement at this time that they would be placed on that airplane. It was a decision and a negotiated agreement with Canadair that they would purchase the items manufactured in British Columbia, adding to the economic benefit of the province.

MR. LOVICK: Did you not make reference to a particular kind of tank? You gave it a number and another configuration to describe it. Is that not a tank that is, in fact, custom-made for that particular aircraft?

HON. MR. MICHAEL: Yes. The member is obviously referring to the forward fuel tanks for CL-600 Challenger aircraft. That purchase was made in May 1988. The question the member is perhaps leading up to is whether or not that particular tank was placed on that particular airplane that is owned by the B.C. government. The answer is: I don't know; I doubt it.

MR. LOVICK: Forgive me for this. I'm struggling because I'm trying to get hold of this economic argument that is apparently being induced here. We are being told that the Challenger deal was a good deal because of the initial price, and because of what you refer to as spinoff benefits or offset agreements.

Yet it seems that at least some of those offset agreements are contractual obligations that we would have only if we bought that aircraft. In other words, we don't get the savings unless we enter the deal in the first place. The question then becomes whether the saving is a real saving, or whether it's an artificial one. Is that too subtle? Do I make my meaning clear? Would the minister like to respond?

HON. MR. MICHAEL: We certainly aren't guaranteed of the offsets in the purchases in British Columbia without the agreement being negotiated. The question of offset agreements, I'm sure, is probably strange to the socialists. The socialists continually get into trouble, because they don't see all the opportunities out there for causing economic activity in a province, creating jobs, creating sales taxes and revenue for the province.

We on this side of the House are continually examining opportunities for offset agreements. Every time major purchases are negotiated or entered into, we always wish to examine and explore those opportunities. There is no question that the good management decisions that have been made in the past — and will continue to be made in the future — assist the economy of the province into the great state it's in right now.

Initiatives such as offsets and Market Discovery '88, where the Purchasing Commission set about hosting and organizing a showcase of all the items being manufactured outside the province, show the entrepreneurs of the province the opportunities that exist in spending money, creating jobs and creating economic activity. Indeed, the success stories are numerous.

[ Page 6271 ]

It's one thing I have never done an analysis of, and perhaps the member has given me an idea. I should perhaps now go to the library and explore and find out whether Manitoba, in its negotiations and purchases, ever really looked at offset agreements. If they didn't, it could be the signal — and maybe one of the real cornerstones for their disastrous failure. I will have to embark on a bit of research in that area to find out whether or not that's one of the things that pulled that province down, and indeed, as we all know, caused the government to be ousted from office. They didn't only finish as the official opposition but finished in third place — not the most disastrous but one of the most disastrous defeats ever witnessed in Canada.

With that, I trust that we've given the member a bit of an explanation of the good business practices of government and of the great benefits that offset agreements can provide to an economy. It's jobs, and I know the member is interested in jobs.

MR. LOVICK: Well, indeed we got a bit of an explanation. Unfortunately, I'm afraid the explanation isn't satisfactory. Instead, the minister has now forced me to take the bit in my teeth and pursue this matter and see if we can get some answers.

[5:30]

What I seem to be hearing from the minister is a kind of convoluted defence of public initiatives. This self-same person who wants to talk about the glories of the marketplace, of privatization, of the entrepreneurial spirit, is the guy defending a whole economic program based on direct government intervention in owning this particular aircraft. The question we've been posing is simply the advisability of the government tying up money in that thing when in fact it could perhaps get a better deal by going directly to the private sector; and whether the use that is made of that particular aircraft is justified by this government and its activities. We've been trying to get answers to those questions and haven't. Instead, what we get is a rather arcane and difficult-to-comprehend argument about offset, and it doesn't sound as if offset is really offset; it sounds, rather, as if offset equals added expense.

From a description of the wing tanks and saying: "If you buy this particular aircraft, what we are going to do is give you a deal on buying the necessary maintenance and replacement equipment that you're going to have to get...." That sounds to me almost like a loss leader or something. I'm wondering how we can stand here and straightfacedly say that this is all part of the good deal.

That explanation effectively ignores the two basic questions, the first of which is: how much did we spend originally and did we need to spend that much? Could we provide that service more cheaply? Second, is that entire so-called offset expenditure really more liability than asset to us? I have not heard the minister give a clear answer to either of those questions. I would invite him once more to explain to me where the economic benefit is in that offset agreement. Don't tell me about spending a whole bunch of money being bound to create some spinoffs, and all that. We all know that.

Let me remind you that this is the government that said we had to talk about restraint of government expenditures because that money wasn't performing any economic miracles. Now you're trying to use the same kind of arguments in terms of government spending to say it generates all these kinds of things. Pray, spare us that kind of platitudinous stuff. It doesn't really answer the question and in fact contradicts most of your other explanations. If you will, answer those two very specific questions about just what the economic benefit of this particular deal is.

HON. MR. MICHAEL: I certainly welcome the opportunity to talk about the good business practices of this government and about the word "leverage": how, by good business practices, you can make things happen over here; there's an area of opportunity; it opens up another window; you could multiply that and deliver more benefits to the province.

We're proud of the record of this government. We're proud of the efforts of the B.C. Purchasing Commission. We're proud of the initiatives that are coming from employees within all ministries — the cost-saving ideas and privatization suggestions. There are a lot of exciting things happening in the province.

Regarding the government involving itself in such things as offset agreements, well, yes, if there's an opportunity there, certainly we would use government funds on purchase agreements to attempt to get spinoff benefits. We will take advantage of that. We will lever the spending of government funds to create more activity within the province.

We do not follow any narrow-minded economic theories like the socialists do. They just get on one path and on they go down that narrow road of socialism. The government owns everything — nationalize industries; disasters result all over the world. There are examples beyond belief, and contradictory things beyond belief, too.

I was very interested in an article I read in one of the international journals the other day about the socialists in Australia embarking on the manufacture of war weapons, getting into the armament field and bragging about the number of jobs and the cash flow into that great country. It's shameful when the socialists can stand up in the province of British Columbia and talk about the kind of things they talk about, and their counterparts in Australia are spending hundreds of millions of dollars getting into the armament industry. We find these contradictions all the time.

We find the members opposite talking about the disasters of privatization. We look at the country of New Zealand: a Labour government, and what's the great plank and platform and success that they are delivering to the people in New Zealand today? I will tell you what it is, Mr. Member. If you want to read about it, I will send you some clippings. The word is privatization. That's what they're doing in New Zealand. They should be proud of it, and you should be

[ Page 6272 ]

proud of it. But you should also be proud of the things that are happening in British Columbia as a result of this government's initiatives. But no, you don't want to do that. You get up and criticize, complain and condemn, and are always tearing down. Surely there must be some things that have happened in this ministry and in this government that you feel good about, that you could talk about for just a few minutes, rather than continually getting up in the House and tearing down, criticizing and condemning.

MR. CLARK: I know we have a new Chairman, and it's nice to see different people have experience in the chair.

Just before I move on to some different topics, I wonder about the Challenger. I haven't been following all of the debate. Is it used for ambulatory work, like the previous government airplanes?

MR. LOVICK: Ambulance work.

MR. CLARK: Isn't it ambulatory?

MR. LOVICK: You fly so you don't have to ambulate.

HON. MR. MICHAEL: I see the members opposite ridiculing, making fun and laughing about the ambulance facilities we have in government air services. I think that they had better check the record, do some homework and find out just what a great job this government is doing in air ambulance. Thanks to the Minister of Transportation and Highways' (Hon. Mr. Vant's) great airport assistance fund, we have airports all over the province. It's a great program, spending millions of dollars blacktopping and building airports in all of the smaller communities. What do we receive from opposite, Mr. Chairman? Laughter and ridicule. We're proud of the fact that we have some of our Citations equipped with ambulance facilities. Thanks to the combined efforts of the Minister of Health (Hon. Mr. Dueck), the Minister of Highways and the Minister of Government Management Services, there's no question that scores of lives can be credited to the rapid delivery the province gives those patients.

MR. WILLIAMS: On the Challenger?

HON. MR. MICHAEL: I'm glad the first member for Vancouver East reminded me. Yes, the Challenger is equipped. We can use it on demand for air ambulance service.

MR. LOVICK: How often?

HON. MR. MICHAEL: I can tell the member, Mr. Chairman, that it's like an insurance policy; it's something you never really want to have to use for that purpose. I have insurance on my house, and hopefully I'll never have to draw on that policy. I have insurance on my life; hopefully no one will have to draw on that policy for some time.

Certainly we have the Challenger equipped. It can go in emergencies, if needed. It cannot land, as the member is fully aware.... He knows the requirements for distance for landing. I believe it can land at close to 50 percent of British Columbia airports. We are continuing to upgrade and improve the airports throughout the province.

Interjection.

HON. MR. MICHAEL: No, it can't land in Salmon Arm. He knows that; that's why he posed the question. That was a leading question. The Citations can. The Challenger can land at about 50 percent of the airports in the province. Indeed, it's there if needed. If there's a disaster the Challenger is ready; the crew is ready. We will be on site and look after the disaster. We hope it never comes.

In response to an earlier question, I want to emphasize that the Challenger parts manufactured in the province clearly go back to the factory, where planes are assembled and sold elsewhere. I don't want anybody to have the impression that the manufactured parts are all being put on that plane, because that is clearly not the case.

MR. CLARK: How many times has the Challenger been used to transport individuals in care?

HON. MR. MICHAEL: I'm not sure whether the member opposite was listening very closely about the insurance policy.

MR. WILLIAMS: It's never been used.

HON. MR. MICHAEL: As of today, it has only been used once.

MR. CLARK: I'm not aware of the details, but how many planes did we have before we bought the Challenger, and did we mothball some of them when we bought the Challenger?

HON. MR. MICHAEL: That's a very good question, as are the questions that the member asked yesterday. By the way, have you received the responses to the questions? If my staff would just pass them forward, we'll see that they're delivered to the member. I trust that next time you won't wait so long. If you've got questions, mail them to the office. We'll get the responses prepared for you.

[Mr. Pelton in the chair.]

On the question about numbers of planes, we used to have five Citations and two Beechcraft 200 turboprops, for a total of seven. The recommendations and decision of the previous minister were to get rid of the Beechcraft 200 turboprops and to downsize and upgrade the fleet. We now have a fleet that's in very good condition: five Citations and one Challenger. So we've reduced the fleet from seven to six and upgraded it somewhat. Two older Citations were replaced in December 1988, and one of the Citations

[ Page 6273 ]

that was sold had more hours than any other plane of its calibre in the world fleet. It is certainly utilized extensively. Many hundreds of hours are logged on those planes every year for ambulance care. Of course, as we're all aware, a tremendous amount of hours are logged for executive travel as well.

On normal occasions — there are exceptions — we have what we call a "sched flight" leaving Victoria on a regular basis. There are cancellations and the odd interruption, but by and large we have sched flights that the staff have at their disposal.

MR. CLARK: Were the seven previous.... It seems to me we got rid of two Beechcraft aircraft. Were those two used for air ambulance service?

[5:45]

HON. MR. MICHAEL: I believe the Citations were used for ambulance. I think it's safe to say that we currently have two Citations fully equipped and utilized and on standby for ambulance service. Of course, as I said earlier, we also have the Challenger as a backup.

MR. CLARK: I'll change the subject quite dramatically, actually. I want to deal with a couple of questions about the superannuation commissioner and the pension options for employees. This is a rather specific question, and I ask for your staff's attention to this question, because it is rather curious.

I want to read for the record a recent letter to the superannuation commissioner from an individual regarding a question.... It says:

"My concern arises from the fact that you stipulate that upon retirement, the funds must be converted to a life annuity of our choice. My choice would be not to invest in any type of life annuity but rather a registered retirement income fund or RRIF. The differences are great, both in terms of flexibility in administering my retirement income needs and the options available for investment."

Also, Mr. Chairman, a life annuity is not covered by the Canada Deposit Insurance Corporation, and a registered retirement income fund is. It seems to me rather a strange interpretation that if you cash out as a privatized employee you have to roll it into an RRSP and then you have to roll it into an annuity rather than a RRIF. The superannuation commissioner has responded to that letter by saying you must convert your RRSP to a life annuity purchased from a life insurance company — a very tight directive from the superannuation commissioner.

The ombudsman looked at this question, as I understand it, and a woman in his office has responded by saying.... I will quote you selectively from a letter:

"We compared the form" — the form they are required to fill in — "to the relevant legislation, and we agree with you that the form is more restrictive than the legislation. The legislation gives privatized employees a unique option of withdrawing from the superannuation fund not only the contributions they themselves made plus accrued interest but also the contributions made on their behalf by the employer. This option is conditional on the funds being transferred to either 'a registered pension plan established by the new employer' or 'a registered retirement savings plan containing terms satisfactory to the commissioner that the sole purpose of the plan is to provide a pension or to purchase a pension from a life insurance company.'"

That's in the act.

Maybe the staff can help you with this. It seems a little strange — maybe it's just an oversight — that there would be a specific reference that an annuity must be purchased from a life insurance company, as opposed to other options which this person is arguing are more valid — at least equally valid.

The ombudsman's letter goes on:

"The superannuation commissioner says that the government's intentions provide privatized public servants with a setting that is equal to the one applicable to those public servants who did not become privatized and ultimately will receive a pension from a superannuation fund. This latter group of future pensioners will definitely benefit from the contributions made by the employer.

"The superannuation commissioner has advised us of the possibility of seeking a retroactive amendment to the applicable Section in the Pension (Public Service) Act to ensure that the act is consistent with the government's intention."

Did you catch that, Mr. Minister? I know it's rather a specific question, but it does seem entirely valid. I wonder if the minister could comment.

HON. MR. MICHAEL: May I first compliment the member on his area of interest. It's good to see members in the chamber taking an interest in the benefits of employees. Having worked in the area of benefits for many years, I welcome knowing that we have people who have taken the time to do a little bit of reading and studying on the great benefits package that this government has had in place, and the great benefits package that was offered to a wide number of employees during the early stages of privatization. I have been well briefed in this area; indeed, we have had extensive discussions on the advisability and the logic and the rationale and the reasons. There are a lot of armchair experts in the world — rightfully or wrongfully — regarding what to do with money at a particular time. On occasions, when I was in the field of industrial relations, we witnessed employees who would want to come in and opt out of the pension plan. They used to come in and say: "Don't deduct 6 percent from my wages. I'll gladly take it and go out and invest it and buy some houses and rent them out, or buy pubs" — or whatever people do with their money — "and make more money than superannuation will provide me."

Interjection.

HON. MR. MICHAEL: Yes, there are all kinds of opportunities.

But it doesn't always work out that way. People take the money, get the cash and maybe make some investments that weren't that wise. Then what happens to them when they are 60, or in those twilight

[ Page 6274 ]

years, 60-65, and they want to retire? They find that their savings are gone.

In this instance, the government was extremely generous. We are extremely proud of the offers and the programs that were made available to employees as a result of the RRIF.

The question of whether or not they should be able to take their own funds.... Even though they only had perhaps five or six years of employment, they would be able to draw out all their funds — and all of the government matching contributions — and go out and buy an RRSP and perhaps avoid any tax for a period of time, and then decide to cash that in prior to their retirement years. It's not good business from a benefits administration point of view. The prudent thing, in my view — and I've stuck with my staff on their recommendations — is to carry on. That money has got to be locked in; it's got to be tied right down. It was paid in and matched for the purposes of pension, and it should stay there. If they wish to take it out of the government plan and put it in an RRSP with VanCity Credit Union, or whoever else, then there must be a caveat placed on that RRSP that if it is cashed in, it must be put into an annuity payable for life.

We make no apologies for that. We think it was a good decision on behalf of the employees. I know there's the odd ripple along the way. The odd person complains. Yes, we've received the odd letter. But on reflection, and if you look to the future, the decisions — perhaps somewhat paternalistic — made by government, I'm convinced, will be the best in the interests of the employee when that employee enters the retirement years.

HON. MR. VEITCH: I just want to assure the hon. Minister of Government Management Services — and I'm sure the Hon. Chairman will take umbrage at this — that 60 is not necessarily the twilight years.

MR. CHAIRMAN: I won't comment on that.

MR. CLARK: I won't comment on that either, Mr. Chairman.

The minister gave an interesting answer, and I'm still trying to understand how it related to my question. I must say, if I can, that it was a bit offensive and a bit paternal, with respect to employees who have chosen to move with their private employer as a result of privatization. But leaving that aside, I would like to get back to my specific question. I see there are some staff here who might be able to help.

First of all, everybody agrees to lock in the RRSP. The question is why upon retirement one couldn't flip it into a RRIF, a registered retirement income fund, rather than an annuity with a specific life insurance company. It seems to me that some more flexibility upon retirement is reasonable. It seems to me that the RRIFs are guaranteed by the Canada Deposit Insurance Corporation whereas life insurance companies are not, and it seems to me entirely appropriate.

I gather from information from the ombudsman that the superannuation commissioner has, if not recommended, at least indicated that a possibility would be to seek a retroactive amendment to the applicable section of the pension act. Could the minister respond to the specific question of a RRIF versus an annuity?

HON. MR. MICHAEL: I think some of the criticism we've received is based on the misunderstanding of individuals who commonly believe that life insurance companies always win and the annuitants always lose when a life annuity is purchased.

If the member wanted to debate or discuss the overall advisability of buying a private life insurance policy — a fixed-term policy, a money purchase policy, so to speak — from a life insurance company, or the suggestion that the government might force someone to buy an individual policy from a company, I would have to agree that there are questions of whether or not that's a good investment. I happen to believe it's not. I would much rather look at the term insurance or group insurance concept.

What we're doing here, Mr. Member, is setting the wheels in motion so that a person can either leave his money in the superannuation society or put it into an RRSP. When he wishes to transfer that to an annuity, he must buy it from a bona fide, licensed, registered life insurance company — whatever life insurance companies do.

In my experience — and to my knowledge — I can't think of a single society that collects money from employers, employees or a combination of both where, if they don't take the position of insisting that the pension be converted within their own society, they don't insist that it go to a bona fide life insurance company. I believe that's the way it is. Indeed, it's part of the legislation that we have in B.C. As far as I know, it's the same all over. I think it's prudent; it's good business. I don't think there's any problem with the government taking that position. I think life insurance companies are good administrators of money in this respect, offering annuities on a long-term basis.

With that, Mr. Chairman, I move the committee rise, report progress and ask leave to sit again.

The House resumed; Mr. Speaker in the chair.

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

Hon. Mr. Strachan moved adjournment of the House.

Motion approved.

The House adjourned at 5:59 p.m.

[ Page 6275 ]

Appendix

AMENDMENTS TO BILLS

17 The Hon. R. M. Johnston to move, in Committee of the Whole on Bill (No. 17) intituled Residential Property Tax Increase Limitation Act, 1989 to amend as follows:

SECTION 2,

(a) in the proposed subsection (3) by deleting "parcels" and substituting "land", and

(b) by adding the following subsection:

(6) Where a rate relating to the calculation of property taxes is set under an enactment by a body other than the council of the municipality, the council shall, by resolution, substitute a different rate with respect to the 1989 taxation year so that the calculation under subsection (5) will result in the same amount of revenue being produced as would otherwise be produced for the rate setting body.

SECTION 6.1, by adding the following section:

Commencement

6.1 (1) This Act shall be deemed to have come into force on April 11, 1989 and is retroactive to the extent necessary to give it effect on and after that date.

(2) A calculation made in accordance with section 2 (5) or a resolution made in accordance with section 2 (6) or 3 shall be deemed to be valid if it is made on or after April 11, 1989.