[ Page 8559 ]

CONTENTS

Routine Proceedings

Presenting Reports –– 8559

Milk Industry Amendment Act, 1989 (Bill 45). Hon. Mr. Savage

Introduction and first reading –– 8559

An Act to Restore the Integrity of the Agricultural Land Commission

(Bill M224). Mr. Barlee

Introduction and first reading –– 8560

Securities Amendment Act, 1989 (Bill 83). Hon. Mr. Couvelier

Introduction and first reading –– 8560

Private Members' Statements

Real estate speculation tax. Mr. Clark –– 8560

Hon. Mr. Couvelier

Controlling tobacco addiction: a provincial strategy. Mr. Perry –– 8563

Hon. Mr. Dueck

Committee of Supply: Ministry of Forests estimates. (Hon. Mr. Parker)

On vote 27: minister's office –– 8565

Mr. Miller

Hon. Mr. Brummet

Mr. Kempf

Municipal Affairs, Recreation and Culture Statutes Amendment Act (No. 3),

1989 (Bill 75). Hon. Mrs. Johnston

Introduction and first reading –– 8579

Social Service Tax Amendment Act (No. 2), 1989 (Bill 81). Hon. Mr. Couvelier

Introduction and first reading –– 8579

Temporary Use Tax Validation Act (Bill 82). Hon. Mr. Couvelier

Introduction and first reading –– 8579

Food Choice and Disclosure Act (Bill 85). Hon. Mr. Savage

Introduction and first reading –– 8579

Electoral Boundaries Commission Act (Bill 87). Hon. Mr. Reid

Introduction and first reading –– 8580

The House met at 10:04 a.m.

Prayers.

HON. MR. RICHMOND: On behalf of the Attorney-General (Hon. S.D. Smith) and myself it's my pleasure to introduce Brenda Jones, a longtime friend and supporter from the law firm of Mair Janowsky Blair in Kamloops. Would you please make Brenda welcome.

MR. KEMPF: I have a question of privilege, and I wish to reserve my motion so as not to lose earliest convenience, as I'm perfecting that motion at this time.

MR. SPEAKER: That's fine.

HON. MR. RICHMOND: With leave, I would like to move a motion on behalf of the Select Standing Committee on Labour, Justice and Intergovernmental Relations.

Leave granted.

HON. MR. RICHMOND: I move that in addition to the powers previously conferred upon the Select Standing Committee on Labour, Justice and Intergovernmental Relations in respect of the report of the Royal Commission on Electoral Boundaries for British Columbia, December 1988, the said committee shall have the following additional powers, namely: (a) to appoint of their number one or more subcommittees and to refer to such subcommittees any of the matters referred to the committee; (b) to sit during any period in which the House is adjourned, during the recess after prorogation until the next following session, and during any sitting of the House; (c) to adjourn from place to place as may be convenient; and (d) to deposit the original of its reports with the Clerk of the Legislative Assembly during a period of adjournment, and upon the resumption of the sittings of the House, the Chairman shall present all reports to the Legislative Assembly. I so move.

Motion approved.

Presenting Reports

MR. CHALMERS: Mr. Speaker, I have the honour to present the first report of the Select Standing Committee on Labour, Justice and Intergovernmental Relations respecting the report of the Royal Commission on Electoral Boundaries for British Columbia, December 1988.

Mr. Speaker, I move that the report be taken as read and received.

Motion approved.

MR. CHALMERS: Mr. Speaker, by leave, I move that the rules be suspended to permit the moving of a motion to adopt the report.

Motion approved.

MR. CHALMERS: Mr. Speaker, I move that the report be adopted, and in doing so I would like to express my appreciation as Chairman of the committee. Although our task is not yet totally completed, much of what we have been assigned to do has indeed been finished with the tabling of this report today.

Because this is probably my last opportunity before the House rises to express in this assembly my appreciation to the members of the committee, I'd like to do that today. In particular, I'd like to express my appreciation to the member for Burnaby-Edmonds (Mr. Mercier) and the member for Cowichan-Malahat (Mr. Bruce), who have spent many hours with me attempting to work our way through the Fisher report and all there was to do with that. Also, I'd like to express my appreciation to the member for Esquimalt–Port Renfrew (Mr. Sihota). He's not here today, but I can assure all members of the House that he has been most cooperative in trying to complete our task; and to the member for North Island (Mr. Gabelmann) as well, for his assistance and cooperation.

I'd also like, on behalf of the members of the committee, to express our appreciation to Judge Fisher, who had an impossible task to perform but has done it very well.

Motion approved.

Introduction of Bills

MILK INDUSTRY
AMENDMENT ACT, 1989

On behalf of the Minister of Agriculture, Hon. Mr. Richmond presented a message from His Honour the Administrator: a bill intituled Milk Industry Amendment Act, 1989.

HON. MR. RICHMOND: Mr. Speaker, the purpose of the legislation is fourfold: (1) to provide for mandatory certification of all commercial dairy farms to ensure high sanitation standards on dairy farms and provide high-quality milk to the public;

(2) To enforce an orderly marketing system and ensure equitable treatment of all producers. This will be accomplished by repealing sections in the Milk Industry Act which established the Milk Board and its authority, recreating the Milk Board as the B.C. Milk Marketing Board under the Natural Products Marketing (BC) Act, with parallel powers plus specific provisions to regulate producer-vendors who custom-process milk into milk products;

(3) To restructure the Milk Board to allow greater industry direction and improve accountability of the board to the industry;

[ Page 8560 ]

(4) To make provision for B.C. Marketing Board to be the supervisory and appeal body for the B.C. Milk Board decisions in order to provide for improved and less costly appeals and to ensure consistency in treatment of commodities under marketing legislation.

Bill 45 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

AN ACT TO RESTORE THE INTEGRITY
OF THE AGRICULTURAL LAND COMMISSION

Mr. Barlee presented a bill intituled An Act to Restore the Integrity of the Agricultural Land Commission.

MR. BARLEE: This bill does three things, essentially. It avoids issues like the Spetifore lands case. It does abolish cabinet, regional district and municipal council involvement in the appeal of an Agricultural Land Commission decision to include or exclude land in the reserve. Since these powers were established, there has been a net loss of over 60,000 acres of farmland from the agricultural land reserve, and of this approximately 21,600 acres were prime farmland.

It provides for independent consideration of appeals of commission decisions by the Supreme Court of British Columbia. It is the intent of this bill that any person aggrieved may have their day in court and be heard.

Finally, it expands the mandate of the commission to be a steward of the agricultural land, greenbelt land and parkland. The commission may also hold land suitable for urban or industrial redevelopment in a land bank. With funding voted separately by the Legislature, the commission could play a strategic role in making available sites for affordable housing.

I move that the bill be placed on orders of the day for second reading at the next sitting of the house after today.

Bill M224 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

SECURITIES AMENDMENT ACT, 1989

Hon. Mr. Couvelier presented a message from His Honour the Administrator: a bill intituled Securities Amendment Act, 1989.

HON. MR. COUVELIER: Bill 83, the Securities Amendment Act, 1989, continues the process we have been pursuing over the past two and a half years of strengthening the securities regulatory system of this province.

As I announced last year during debate on the Securities Amendment Act, the bill I am presenting to the House this year includes amendments to the Securities Act dealing with enforcement powers, insider trading, and takeover and issuer bid rules. The bill also contains a series of miscellaneous amendments to clarify and improve a variety of sections of the act. Collectively these amendments represent a significant package of measures that will assist the Securities Commission in administering the act, improve the protection of investors and contribute to the interjurisdictional uniformity necessary for the efficiency of Canada's national securities market.

With the presentation of this bill, the government has largely completed one of the most significant major rewrites of legislation as it affects the financial community of any jurisdiction across Canada. It's our view that with the pounds — literally pounds — of legislation which have been introduced during this administration's tenure, we have significantly altered and improved the operating style of B.C.'s financial communities. We take great pride in the fact that we believe this represents a culmination and a new era in terms of how B.C.'s financial community operates and how it may effectively compete with the international community. I look forward to debate on this bill.

Bill 83 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

[10:15]

MR. SPEAKER: The second member for Vancouver–Point Grey seeks leave to make an introduction.

Leave granted.

MR. PERRY: I would like to introduce my wife, Beth Chambers, who is sitting in the members' gallery, and ask the House to make her welcome, please.

I would also like the privilege of welcoming to British Columbia Mr. Pete Seeger, who is not in the precincts but will be well known to many members. Yesterday was declared Pete Seeger Day in Vancouver by the city of Vancouver. He gave a marvellous concert, and I would like the House to make him welcome in B.C., please.

Orders of the Day

Private Members' Statements

REAL ESTATE SPECULATION TAX

MR. CLARK: I rise today to speak on the need for a real estate speculation tax in British Columbia. Mark Twain once advised a young friend as follows: "Invest in land; they don't make it anymore." It was good advice then, and it's good advice now. It is good advice certainly in British Columbia, because more money has been made in land than in any other commodity. We certainly know that with this administration: millions of dollars in profits have been made on land.

The problem is that land is not just any other commodity. It's not like automobiles, television sets,

[ Page 8561 ]

yachts or any other item, items that certainly can and should be left to the free market. Land is too important, too fundamental, to be left solely to the vagaries of the market, because the real estate market in British Columbia, and certainly in the lower mainland, is not servicing the needs of the vast majority of the population. It's simply not working. It's not good enough for this government and this minister to wring their hands and say: "There's nothing that can be done; there is simply nothing government can do."

The problem, in my view, is that the government is so ideological and narrow that it refuses to intervene in the land market to influence the shape, pace and pattern of development, and too rigid to try and intervene to help British Columbians in the land market. Land is simply too important to be left solely to the marketplace, because it's vital to economic development, vital to the quality of life and, most importantly in this context, vital to the housing needs of British Columbians. The government's wilful blindness to the pressures building in Vancouver and the lower mainland and the housing crisis that exists are a recipe for disaster.

Well, what could be done, Mr. Speaker, if we had a government committed to finding solutions? On our side, we've called for a land speculation tax. What we need is a tough, substantial tax to discourage, to try to eliminate, real estate speculation. Too much of our market in the lower mainland is taken up by individuals and companies making quick profits by flipping property, buying land and houses not to live in but to hold for a short time and then sell for a quick profit.

Land speculation and speculators add nothing to our community and nothing to our economy. The profit is simply unearned. No one begrudges an individual who by their own sweat builds or creates something of value and, by so doing, creates a profit. But unearned windfall profits that accrue to speculators are in fact detrimental to the community. Their actions drive a portion of the housing market and keep prices moving up.

How would such a tax work, Mr. Speaker? Well, the concept is certainly very simple. A homeowner buys a second house for $200,000 and then sells it within one year for $300,000. Of that $100,000 profit, 80 percent would be taxed away. This percentage would decline over time, so that the longer one held the property, the less one would pay.

The idea is not for government to make money on such a tax, but rather to stop the harmful speculation in real estate that's taking place in the lower mainland. Such a tax was in place in Ontario between 1974 and 1978, and the principle of that tax is the same principle that I put forward today and is as follows from that act: anyone who invested in land that was not his principal residence, summer cottage or land that was not improved, renovated or was not needed for productive business was subject to the tax.

The government of Ontario then and the New Democratic Party of British Columbia now are stating very simply that by the imposition of this tax the housing needs of the population are more important than to leave land to the vagaries of free markets — or vagaries to a market that in many cases is not free.

Did it work in Ontario? Well, the answer is yes. From 1972 to 1974 Toronto housing prices rose 62 percent. After the tax, from 1974 to 1976, prices rose only 16 percent.

Would it work in British Columbia? Clearly the speculation taking place in British Columbia is at least equal to that which took place in Ontario from 1972 to 1974. Clearly a similar tax in British Columbia would work here and now.

The minister may take some comfort in a recent study in Ontario which suggested that a speculation tax in Ontario isn't appropriate now. The problem with the study, however, was that it defined speculation far too narrowly. It identified only those sales that were flipped in six months. Even then, Mr. Speaker, it identified 7 percent of all land sales as being flipped within six months, which is not insignificant. But over a three-year period, it is estimated that in an Ontario market, 20 percent of purchasers flipped their property in a three-year period, and that's only those that qualify under what would be called speculation tax, as I have described it.

It's true, Mr. Speaker, that the land speculators only occupy a percentage of the market, but it's a group of people that have an influence over price. Taxing them would dampen the rise in housing prices in the lower mainland and further have the effect of eliminating — or at lease reducing — this method of making quick money, which creates no value and adds nothing to the community.

In recent months we have had Pat Carney, a former federal Conservative minister, suggest a need to look at such a tax in Vancouver. You've seen the federal minister, again a Conservative Minister of Housing, suggest the idea in Vancouver. You've seen the municipal property tax review committee of Vancouver recommend the province seriously consider such a tax, and we've seen hundreds of people in Point Grey vote in a recent by-election, at least in part, because the New Democratic Party was taking a position on a land speculation tax and the housing crisis that exists in Vancouver. The only people who refuse to consider this idea seriously is this ideologically rigid government, this government that has those ideological blinkers on and that won't consider a tax which has worked in Ontario and would work in British Columbia.

HON. MR. COUVELIER: As usual, we on this side of the House aren't surprised to hear that once again the centralist, socialist, pointy-headed thinkers seem to believe that intervention is the remedy for all of life's ills.

The fact is that government intervention in any economic enterprise, particularly the marketplace, is traditionally shown to be a non-productive intervention and without the effect that the intenders desire.

The first comment I would make on the words I heard this morning is that somebody on this side of the House suggested that it wasn't Mark Twain who made the statement that land is a finite resource, but

[ Page 8562 ]

rather Will Rogers. I don't know who is the true author, but I wouldn't be surprised to learn that once again the very basis in the opening remarks of the opposition on any issue proved to be inaccurate.

The other comment made was that land is too important to leave to the vagaries of the free market, which, of course, is true. Land is an important issue. It is a finite resource, and we all should express some concern about attempting to minimize profit-taking and unproductive windfall gains. On the other hand, as it was stated here that it's a very simple issue, we have to point out quite clearly that the reverse is true: it's a very complex issue. It's very difficult to define when speculation occurs, and certainly our experience and the tradition and experience in other jurisdictions show that it is in the minds of the legislator as to what is speculation.

For example, how would you treat the situation where the farmer happens to be adjacent to a well-developed urban area and by virtue of pressures of urbanization is having more and more restrictions forced on him regarding the operation of his farm? How would you deny him the right to sell for a profit? For most farmers operating on a narrow profit basis, that is their only hope for any sort of retirement income. How would you deal with that very important issue? Would you deny the farmer the opportunity to reap some small benefit from his lifetime of sweat and labour, his 12-hour days, his seven-day weeks, his month after month of working on the farm? Would you deny him that opportunity? How would you deal with the instance of the owner of a small, detached, single-family dwelling surrounded by apartment buildings who is being forced by virtue of this urbanization and changing lifestyle around him to alter his own lifestyle? Would you deny him the right to sell at a profit so that he can once again afford to move to a more rural establishment? How would these pointy-headed centralists, who intend to impose their will on the vast majority of people because they have the arrogance to think they are the only ones with the wisdom to manage these affairs, propose to deal with those subtle little relevancies as related to our population?

We on this side, of course, do agree that the issue is serious, and we do agree that it is appropriate for us to express concern. But we do not agree that the solution is for the heavy hand of government once again to intrude with a solution which elsewhere has proven to be ineffective.

The member made the point that Ontario had such an act and it worked. The fact of the matter is that it did not work. Let me just quote the Ontario Treasurer when asked, as a result of the escalating property prices in Ontario, whether he would re-impose this speculation tax, which didn't work when they had it in the past. He said he was "not enthusiastic about applying a speculation tax on real estate." It does not work, my friends. Intervention in such a delicate matter as this never works.

You cannot remove the element of profit on a rising housing market. The value of land or a dwelling is dependent entirely on the willingness of someone to pay that value. If there is a middleman who happens to make a profit, who sees that opportunity, while it may be deplorable in a social sense, nevertheless it does not violate the basic principle that someone who is prepared to pay more for a property should be allowed to pay what he wishes to pay, and the person who sells the property should be allowed to reap the benefits of that sale.

The fact of the matter is, we would not have speculators anywhere in the market system if there wasn't the demand side which created rising prices. To suggest that you, of all people, are going to somehow license those who might be useful intermediaries astounds me. What would you do with the vast real estate industry created all over the world to act as legitimate marriage-brokers between buyers and sellers? Would you somehow think that you have all the wisdom necessary to adjudicate and impose settlements on innocent people?

MR. SPEAKER: I regret to inform the minister his time is up under the standing orders.

MR. CLARK: It's interesting that the minister says government intervention doesn't work, and yet they are intervening all the time, trying to help property owners and tenants who are seeing their property values rise dramatically. It's also interesting that he says this is a socialist idea, even though it was brought in in Conservative Ontario.

I have here an article written by the Premier when he was mayor of Surrey. Listen to this. Skyrocketing land values can be resolved

"...by government through taxation, the best tool there is for stabilizing the price of land. The price of land could be controlled to a large degree by application of the capital gains tax at different levels: one for vacant land held purely for speculation; another for a farm that is being transferred from one farmer to another; still another level for a home that is being sold because the owner is moving to a smaller house. If a commercial enterprise or industrial complex were being sold but the physical plant would not change under the new owner, yet another level of gains tax could be applied.

"The tax structure for capital gains at present is a very simple form. It could be amended. It could encourage people to sell lands that are of no utility value to themselves and thus cut out much of the speculation factor. This would certainly diminish the horrendous profits that have been manipulated through pure speculation.

"We should not allow land to be used for speculative purposes," the Premier said in 1975. "In a country like Canada, with its abundance of opportunities, there should be incentives for citizens who are prepared to work hard so we can retain this human resource, the backbone of the country. There should not be the present system in which people can get rich time and time again simply because they have money to invest in land and are able to turn it over and over, compounding profit without doing a thing for it. They have not added anything to the economy nor to the culture of the country; they have not done any work or built anything; They have not written a book or painted a picture. That is wrong."

[10:30]

[ Page 8563 ]

The Premier was right in 1975. Why aren't they doing it today? It's absolutely clear that speculation harms the community. Governments intervene all the time. The Premier, when he was the mayor of Surrey and saw rising land values, called for a form of speculation tax exactly like what we are calling for today. Yet when he is faced with the most serious housing crisis ever in the lower mainland, when he is faced with skyrocketing values and people losing their homes and being evicted in Kerrisdale, he sits and says: "We can't do anything. We can't intervene." The ideological blinkers of the Social Credit Party are on, and they can't intervene in the market. They can't do anything: "Oh, it's too bad. Oh, It's terrible. We can't do anything. Maybe it's offshore buyers. We can't do anything." He knew the answer in '75. The Ontario government knew the answer in '74. We know the answer in 1989, and we will deal with it when we are on that side.

CONTROLLING TOBACCO ADDICTION:
A PROVINCIAL STRATEGY

MR. PERRY: Mr. Speaker, it's a hard act to follow.

As a parent, as a physician and as a member of this Legislative Assembly, I would like to address today a matter of fundamental importance to a healthy British Columbia. Tobacco addiction — known euphemistically as smoking — is the greatest preventable cause of disease, disability and death in Canada. Each year 35,000 Canadians die prematurely because of tobacco, more than the combined total from drunk drivers, all other accidents, alcohol abuse, violent crime, drug abuse, airplane crashes, suicide and AIDS. Smoking kills more than those combined.

Smoking causes more than 30 percent of all cancers, including 80 percent of lung cancers. It causes 30 percent of heart disease and more than 80 percent of chronic obstructive lung disease. For no other toxic substance do we show such inexplicable tolerance, such mercy and such cowardice as for tobacco; yet no other toxic substance takes such a toll in human life.

Smoking can hardly be considered a victimless activity. Not only is the individual smoker the victim of a calculated addiction perpetrated coldly, callously and deliberately by the tobacco industry, but environmental tobacco smoke is also a proven cause of disease, including lung cancer, in non-smokers. Fetuses of mothers who smoke are much more likely to be born with birth defects or with low birth weights or to be victims of a spontaneous abortion. Our provincial health system, straining under increasing costs and demands, is victimized. Reducing tobacco consumption would free much-needed financial and human resources to deal with pressing health problems in other areas that cannot presently be addressed because of the need to stretch resources and because of the prior claims of the tobacco addicts now ravaged by the consequences of their addiction.

Taxpayers, too, are victimized. We all, smokers or non-smokers, pay for the cost of smoking through our health insurance premiums and taxes. Smoking is also a net cost to the economy. The most recent figures show that the total cost to the economy — including fires, lost productivity at work, health care costs, forgone income due to mortality — far exceeds total expenditures on tobacco products, whether to tobacco farmers, manufacturers, retailers or to the government through taxes.

For British Columbia, which has no tobacco growers nor manufacturers, the net economic loss to our provincial economy is far greater. British Columbians pay for the cost of profits earned by the wealthy tobacco industry located in eastern Canada and controlled, without exception, by foreign multinationals.

In B.C., legislative measures are needed to control tobacco use. We need action in this province on this pressing health issue, and we need action now, Mr. Speaker. That is why I am proposing an eight-point plan to control tobacco use. Today I will outline this plan, and over the coming months I shall describe it in further detail.

First, we need better controls on smoking in enclosed places. Many municipalities have implemented local controls in some enclosed buildings and in workplaces, but in many cases these bylaws are insufficient to protect employees and the public. Some 30 percent of our citizens live in municipalities that have no bylaw, even a weak one. This Legislature should show leadership, Mr. Speaker, by enacting minimum standards effective throughout our province both in the workplace and in other public places. All employees should be guaranteed a smoke-free environment.

The United States Environmental Protection Agency reports that secondhand smoke is one of the largest sources of indoor air pollution. The only practical way to eliminate exposure is to remove the source, namely lit cigarettes. Tobacco smoke contains 43 known carcinogens, says the EPA. There is no justification for employees to remain unprotected from carcinogens pumped into their air space by tobacco smokers. Smoking should be restricted to separately enclosed, separately ventilated areas that are not normally occupied by non-smokers. As a model employer, the provincial government and the Legislative Assembly should go a step further and make our workplace completely smoke free. This is a step some other provinces have already taken.

Second, taxation policy for tobacco should reflect the hazards and the cost that tobacco imposes on the health care system and on society. Studies show that for every 10 percent increase in real price, there is a corresponding 4 percent decline in consumption. Given the greater price sensitivity shown by adolescents, the incipient addicts, a real 10 percent price increase would result in a consumption decrease of 14 percent. But we should be aiming for much more than a 4 percent or 14 percent decline, and if it requires a major tax increase to achieve this, then we in this assembly should have the political courage to do what is necessary. Others, like the physicians of British Columbia, already have called for the tax on tobacco to be tripled.

[ Page 8564 ]

Third, we need meaningful and enforced laws in British Columbia to prevent the sale of cigarettes to minors. It is illegal — I repeat: it is illegal — to sell tobacco to persons under 16, by virtue of the federal Tobacco Restraint Act, a law passed and not updated since 1908. The maximum fine on a first offence for selling cigarettes to children is $10.

Other provinces have provincial laws, and it is time that British Columbia did likewise. Because the overwhelming majority of smokers succumb to addiction as teens or even preteens, the key to a smoke free society is preventing young people from ever beginning. One of the major reasons young people begin to smoke is their unlimited easy access to tobacco products. Current laws are not enforced. Surveys in this and other provinces show just how readily 12-year-olds can purchase cigarettes from retail outlets.

Tobacco retailers need an economic incentive to obey the law, not the present incentive to disobey it. A proper deterrent, including maximum fines of, say, $100,000 for corporations and the revocation of a retailer's tobacco licence, would discourage tobacco pushers from continuing to flout the law.

Hong Kong, Cyprus, Iceland and some Australian states have banned vending machines completely from their jurisdictions. If British Columbia is not prepared to take this step, vending machines should at least be prohibited in areas accessible to minors. I leave to the minister's imagination, Mr. Speaker, what more healthful products might be substituted for cigarettes in those vending machines — perhaps fresh Okanagan apples.

Fourth, Mr. Speaker, we need a dual-pronged health promotion campaign to discourage tobacco use. To begin, we must ensure that our schools deliver effective educational programs to discourage young people from starting to smoke.

MR. SPEAKER: I regret to inform the member that his time is up under the standing orders.

HON. MR. DUECK: Is it because the House is ready to rise that we finally come to an issue where we agree? I feel practically uncomfortable. I'm not quite sure whether I'm on the right track or whether we both are on the right track, but I have to agree with just about everything the member has said this morning. Of course, he's well aware of that.

The member's got all these good ideas that what government should do is to pass legislation on this and that and the other thing, but perhaps he should go to his own profession first and say to his colleagues: "You are the people in this profession. Why do you continue to smoke?" Even the specialists doing open-heart surgery, who are saying that one of the most important areas of prevention of a heart condition is not to smoke, continue to do this again and again. They are chain smokers. I would remind the member that his first homework should be with his own colleagues.

MR. PERRY: Already done.

HON. MR. DUECK: Good stuff.

I truly believe we should be treating tobacco like an epidemic; no question about it. Tobacco use continues to be one of the most significant preventable causes of death and disability in B.C. Smoking accounts for almost 3,500 deaths in British Columbia alone; in Canada, we estimate between 35,000 and 50,000. 1 have to agree with the statistics. I have to agree with the thrust of what the member says. However, while B.C. has the lowest rate of smokers in Canada, less than 18 percent, the number of teenagers who smoke is increasing, and increasing by a great percentage — a 37 percent increase. Although it is illegal, as was pointed out, to sell tobacco products to those 16 years of age and under, obviously the law is not being enforced, and obviously it's ineffective.

I would like to applaud the former federal Minister of Health and Welfare, Jake Epp, for his persistence in getting the Tobacco Products Control Act through Parliament, and also the Non-Smokers Health Act. So the federal government has done some things in the area of trying to control this.

I have made all Ministry of Health buildings smoke-free. At this time there is no area in Ministry of Health buildings where smoking is allowed.

Probably the most impressive performance of all has come from the municipalities of the province. About 40 municipalities representing roughly 2.1 million people, or 72 percent of the population, have bylaws making public buildings smoke-free. Also, many workplaces in British Columbia are the same — about 1.6 million of the population. As long as an increasing number of municipalities take this initiative, a provincial law to restrict smoking is really unnecessary inasmuch as it is very difficult to pass that kind of a law. But we are making headway. I remember not too many years ago my wife and I went to a PTA meeting. It's now redundant; they don't have them anymore. The subject that was discussed at that particular PTA meeting was whether there should be an area where pre-teenagers — this was junior high — could smoke. We don't consider that today, so we are moving ahead.

However, in advertising we're still showing beautiful pictures of the macho guy and the beautiful woman, the fast car and the motorcycle. The tobacco product is shown. Then we say: "Little Johnny, you shouldn't smoke, because it's harmful to your health." There are many things we are a bit schizophrenic on, because we say one thing but we mean another.

I agree that we have to take steps to do some of the things the member has mentioned. I've written letters to Jake Epp and Perrin Beatty, applauding them where they have taken steps to control the sale of tobacco or its advertising. Perhaps we should take a bold lead and have our own labels on tobacco products, to stop importing products from other provinces. There would be greater control in that area.

[ Page 8565 ]

MR. SPEAKER: Order, please. I regret to inform the minister that his time is up under standing orders.

HON. MR. DUECK: Mr. Speaker, you do this to me all the time.

MR. PERRY: I would love to have heard more. It's the first time I've been able to applaud the minister this session, and I delighted in it.

AN HON. MEMBER: Be nice.

MR. PERRY: I'll resume and continue to make the points he and I agree on.

Studies show that young people are not well informed on how dangerous smoking is. My own conversations with teenagers and pre-teens indicate that young people simply are not receiving the effective educational programs they should. In Ontario, beginning this September, tobacco education will be mandatory for all school board curricula, beginning in grade 4.

Another aspect of a comprehensive anti-smoking campaign that should be directed towards the population of B.C., is substituting effective anti-smoking advertising for some of the banal government propaganda with which we are currently bombarded. We should extend this campaign to the pushers and require point-of-purchase signs and display material at places that sell tobacco. This targets the message directly at the intended recipients, the tobacco addicts themselves. Every purchase of cigarettes is coupled automatically to encouragement to quit the habit. Such a health promotion campaign would be unprecedented in Canada and perhaps in the world. Its cost? Merely that of printing the signs and posters. With implementation of a licensing scheme for pushers, the cost could be recovered completely through the licensing fee.

[10:45]

We need more controls on the packaging of tobacco products. This can be done in a number of ways. One is, paradoxically, to require a minimum number of cigarettes in a package. This would rid British Columbia of kiddy packs, those cheaper packages of 15 cigarettes that are targeted deliberately to seduce children and others with relatively low incomes.

The tobacco industry spends millions of dollars designing packages that are alluring to potential customers, implying subliminally a connection between smoking and health, sexiness or prosperity. Generic packaging would eliminate that. All packages should be colourless and the same size, with trademarks restricted to one small side. The health messages prescribed by the federal Tobacco Products Control Act should be writ bold beneath a skull and crossbones. The more prominent, the more effective.

Provincial health warnings required in British Columbia by regulations under the Tobacco Product Act should be strengthened and enlarged. The current mewling warning of Health and Welfare Canada advising, "Danger to health increases with amount smoked; avoid inhaling," is woefully understated and inadequate.

Because B.C. is the only province that requires health warnings on tobacco products, we also have some ability to control the increasing problem of tobacco smuggling. Smuggling deprives governments of revenue and reduces the price of cigarettes, resulting in increased consumption. But with tobacco products marked uniquely in B.C. — or, shall I say, branded — it would be easy to identify products from outside of the province on which the B.C. tobacco tax is unpaid. These should be confiscated ruthlessly.

We need restrictions on the types of tobacco products allowed for sale. There should be maximum tar and nicotine levels which may not be exceeded. As well, we should call for federal action towards a complete prohibition on smokeless tobacco, something achieved in many other jurisdictions.

Perhaps most effective of all, the province should consider restricting all tobacco sales to provincial stores via provincial tobacco....

MR. SPEAKER: Order, please. Under standing orders, the member's time is up.

HON. MR. BRUMMET: Committee of Supply, Mr. Speaker.

The House in Committee of Supply; Mrs. Gran in the chair.

ESTIMATES: MINISTRY OF FORESTS

On vote 27: minister's office, $327,244 (continued).

MR. MILLER: I was dealing yesterday with the issue of the export permit granted to Tsolum Timber. I wonder if the minister has brought his logs, as he called them, and is prepared to discuss them in any more detail.

HON. MR. PARKER: Madam Chairman, I do not have the logs with me at this time; they'll be in a little later this morning.

MR. MILLER: I would turn, then, to the issue of logging on private lands. There are several scenarios that I want to outline on the issue. First is the issue that has arisen in several locations around British Columbia, where relatively small parcels of privately held land — some within municipalities, some in regional districts — have been logged, or where there is a proposal by their owners to log them, and municipalities and regional districts can't really enact any regulation, or very little regulation, regarding those logging plans.

I recall the Metchosin example, where Canadian Forest Products was proposing to log an area — and in fact did log it — much to the consternation of the municipality and people who lived in the area. In this case the company apparently went in with very little

[ Page 8566 ]

notice given to the local residents. People in the area were shocked at what had taken place. Even a resident who was a forester expressed in the Times Colonist his extreme reservation about what had taken place.

Another area was Shannon Falls in the Howe Sound–West Vancouver area: a similar situation where there was a last-minute attempt to try to come to some agreement in terms of land-swapping, to avoid logging an area of privately held land which adjoined a park.

Recently my colleague from the Kootenays asked a question about logging in watersheds up there. Again we have a situation of private land. All these logging plans impact on people in adjoining areas, yet they are relatively powerless to deal with them or try to regulate what takes place. The only regulation that I believe is available to local governments is in terms of erosion — in other words, if the logging would have a detrimental effect from erosion and those kinds of factors on adjoining property owners.

My colleague from Nanaimo may wish to discuss the issue of the Ladysmith watershed that has recently come up.

I wonder if the minister has given any consideration to these situations, in terms of regulation or empowering municipalities to have much stricter controls, or the ability to have more control, over logging that takes place on private land in these circumstances.

HON. MR. PARKER: The issue of any activities on private land is not within the mandate of this ministry, by legislation. The issue of activities on private land is best handled by those agencies that are mandated to do so.

MR. MILLER: Well, the ministry has certainly been called in. These situations certainly add to the general concern that exists in the province about logging and the way it's carried out and the effects of it. Has the minister not done anything, not considered anything, not discussed it with any of his colleagues, or has he simply said: "It's not my problem and I don't intend to do anything about it"?

HON. MR. PARKER: What we discuss in caucus and cabinet is confidential, but the mandate is quite clear. If he'd care to read it, the member for Prince Rupert can refer to the Ministry of Forests Act. We are responsible for Crown lands within provincial forests.

MR. MILLER: Madam Chairman, that kind of response and refusal to deal is simply another example of the government's low standing in the polls and in the eyes of a lot of British Columbians. Here we have an issue of concern to people in this province. I'm not asking the minister to betray confidences of issues discussed in cabinet. I'm asking him to discuss whether or not the government has considered or has any idea of some solutions to this problem. Or is the government simply saying to people: "Quite frankly, we don't care about it; it's not our business"?

HON. MR. PARKER: The issue has been discussed from time to time, and the Ministry of Forests is responsible for Crown provincial lands within provincial forests. We are not involved in private lands. I for one, respect private property, and I believe in private property. I don't believe in the socialist philosophy of continual interference in private personal property.

Where there are municipal laws, regional district laws and/or zoning provisions, that's a different matter, and if people live within those, they decide democratically whether or not those are going to come to pass. When people have decided democratically what they'd like to do when it comes to restricting activities on private land, then whichever ministry is responsible for enforcing that legislation will take it well in hand.

In the meantime, the Ministry of Forests is responsible for Crown provincial lands in provincial forests.

MR. MILLER: Well, it's that kind of response that we've come to expect — this fatuous nonsense about private property. As my colleague pointed out earlier in statements, we intervene constantly in issues of private property to enforce regulations — whether it's zoning regulations or whatever. It's a constant process that takes place with all governments, and the minister has really betrayed a kind of simplemindedness when he gives that answer.

The question has also arisen in the context of logging in watersheds. Many municipalities are in the situation where Crown provincial land in watersheds is being logged. Again there seems to be a level of frustration in terms of how municipalities and regional districts can exercise some measure of control over that kind of activity. Again it's seen by many British Columbians as simply the interests of the logging companies or perhaps the ministry taking precedence over other interests. Does the minister take a similar view in that kind of situation? Do they attempt to do anything in terms of that whole issue of logging in watersheds? Because it's growing. As we run out of the more easily accessible timber, we are starting to access timber that has been considered more environmentally sensitive. What specific steps are being taken by the ministry with regard to that question?

In connection with the private land discussion, I would also ask if the ministry offers any assistance to either individuals who are going to be impacted by private land logging or municipalities who are trying to come to grips with how they can regulate within the narrow confines that are available to them?

HON. MR. PARKER: The member, if he's resident in British Columbia, should recognize the fact that every piece of land in British Columbia is part of a watershed, and when it comes to timber-harvesting operations within a designated water supply, the planning process is long and involved.

[ Page 8567 ]

For example, the misrepresented case by BCTV the other day about Stocking Lake was a very poor piece of journalism. That planning process occurred over several years with the town of Ladysmith, the Saltair waterworks committee, the Cowichan Valley Regional District and our ministry. In our ministry we maintain experts on staff, including hydrologists.

[11:00]

In the case of Stocking Lake, which was substantially misrepresented to the public, the operation there is an 18-hectare opening. It does not affect any streams going into Stocking Lake, and the streams going into Stocking Lake in the vicinity of logging are dry. So where that activity was purported to have impacted on the water quality for that particular water supply — that is absolutely incorrect.

Throughout the province there are operations in all kinds of watersheds, not just potable watersheds but irrigation districts as well, and every one of those is subjected to a substantial planning process, and the activities in these watersheds are such that water quality is maintained and other interests are protected. As often as not, though, we find in the irrigation districts particularly that it's not harvesting operations so much as cattle-grazing. We also are responsible, under our mandate, for Crown range, but the animals in the irrigation watersheds often will concentrate around water-holes and coliform counts will come up. There is no grazing in the Stocking Lake area, so whatever is causing coliform problems in the Ladysmith or Saltair water supply is coming from another source, and it generally comes from some type of manure.

The planning process for watersheds is one of the most thorough that we have, mainly because of the other user of the resources that are delivered from a timbered area. Probably some of the best examples of such operations in British Columbia are in the Greater Vancouver Water District. Those activities have been going on for... It's in its third decade now.

As I say, they are carefully done and carefully thought out with a great deal of consultation, and the operations can be done in such a manner as to have little or no impact on water quality.

MR. MILLER: It's typical of the minister to attack the press. The minister always attacks the press. There's always someone else who makes a mistake, but never the minister — constantly.

The fact is that in many parts of the province where it's an issue people do not feel that the planning process has been adequate or that the necessary steps have been taken in protecting watersheds.

Moving to the larger issue of private land, I want to deal specifically with TFL 46. As you are aware, there was a serious cutback in the amount of timber being logged in tree-farm licence 46 earlier this year — a shocking announcement, the layoff of a significant number of people on Vancouver Island because of that cutback. It certainly illustrated the lack of planning on the part of the ministry with respect to the whole issue of the annual cut and sustainability. In fact, it is a glaring example of the mismanagement of this administration and its predecessors on that particular question.

It should be significant and should be something that the ministry is concerned about when we talk about the private land within that tree-farm licence, managed forest unit No. 68. Over the years that piece of land has simply been creamed by the company. They have moved from an annual cut of about 3.75 million cubic metres a year in 1974 down to about 400,000 cubic metres in 1989.

Here we have a company that has been given access to Crown resources. If we go back to the original principles of the tree-farm licence system, it was that we would impose management on those private lands. There was a trade-off in terms of private lands being tied to tree-farm licences. That didn't happen. There was no checking; there was no control. We've had a company that's been allowed to cream off the best, not to manage for sustained yield, and the end result is that we've lost significant jobs and industry in the lower Island.

By the company's own admission, they overcut — they creamed. Mr. Neighbour of Fletcher Challenge Canada, in their company newspaper, said: "First, there's managed forest unit 68, which is privately owned by Fletcher Challenge Canada and not subject to any government regulation regarding sustained yield."

There are others, and I don't have a complete inventory of all of these situations in British Columbia. But certainly in my discussions with the people who are the most concerned about it, the people who earn their living from the forest industry, they think it's wrong that a private company should abuse the land in this manner. They think there should be sustained yield practised on active forest land, whether it's held by the Crown or held privately. The ministry's refusal to deal with that has resulted in this overcutting, in this laying off of employees on Vancouver Island.

Perhaps the minister could explain why there has been no attempt to deal with this kind of situation. If he refuses to deal with the smaller situations which really involve more of an aesthetic consideration, why has he refused to deal with the situation that is of significant importance to employment in British Columbia?

HON. MR. PARKER: The Ministry of Forests' mandate covers Crown provincial lands and provincial forests, not private lands. So for the third time, perhaps the member opposite can make a note of that and lock it up. It's right in the statutes of the province.

As far as TFL 46 is concerned, indications over the years have been that the forest management on 46 has been within the terms of the management and working plan and development plans and, subsequently, the PHSPs, the preharvest silvicultural plans. The licensee, staff tell me, is up to date for forest renewal,

[ Page 8568 ]

and all the terms and conditions of the contract have been met.

At the moment there is an audit taking place, as we said we would do. It is both a field audit and a paper audit taking place on TFL 46, and we expect that report about the end of July. We will be making that report public at that time.

MR. MILLER: Madam Chairperson, the minister has a larger responsibility. We're talking about a major company that has abused the resource in British Columbia, and the end result of that is that people have lost their jobs. The minister can stand here and say: "I have no responsibility in that regard; tough." The fact that a company can take those private lands and do that to them, at the same time as overcutting on Crown lands, which has led to the loss of employment in this area.... It's shocking that the minister would say: "It's none of my business." How they, or how the minister, can characterize that as management is beyond me.

The fact is that there are other jurisdictions which do regulate activity on private land. They do it because they think it's important for the industry as a whole, for the people who are employed in the industry. So the refusal of the minister is really beyond belief.

Why was the company allowed to conduct their affairs in such a manner? Was there no checking, no auditing? Where were the Ministry of Forests personnel on this issue? Why did they allow this situation to develop where all of a sudden we have to reduce the annual harvest to such a significant degree to become, in the company's words, sustainable?

HON. MR. PARKER: Madam Chair, the member for Prince Rupert is way off base as usual. TFL 46 has been properly managed. The TFL 46 licensee in the past and the licensee now have met their contractual obligations. Under TFL 46, the issue of harvesting on private lands is not an issue for this ministry; that's by law.

The closure of the sawmill here in Victoria, the loss of jobs, is the result of rationalization of two companies coming together and keeping the most viable operations going. The mill here was designed for a much larger size than the company can realize for log supply to that plant. Part of their losses for the sizeable wood was a result of the Pacific Rim park. The timber that they depended upon to supply this plant here in Victoria was put into preservation It's there, so we can all see what used to go through that type of mill. We can also see what used to be a mill.

A lot of things have to be taken into account when you're considering forest management. Yes, indeed, the manufacturing end of things has to be considered, as well as the regrowth and the tending of new forests. The licensee has met and is meeting those obligations on the tree-farm licence, which is Crown provincial land, for which we are responsible.

The manner in which they deal with their private lands is one that remains within their domain. It is not under the purview of this ministry. I would expect that their private land would be subject to forest renewal as well as the tree-farm land, because the company is in the timber business and they certainly would want to have their land growing trees and not sitting barren.

The issue of loss of jobs in the Victoria sawmill that the member for Prince Rupert talks about is one that basically comes out of the evolution of an industry that is, like everywhere else in the world, as the forest industry matures, getting into a stronger reconstituted-wood industry and away from a solid wood industry. We are fortunate in British Columbia. We will continue to have a solid-wood industry, but the growth and employment opportunities of the future are in greater value-added, through reconstituted wood, which means that we must use a lot of the material that we have not been able to use economically in the past on the basis of a sawmill economy. We are getting into a much more vertically integrated economy, and that's a matter of evolution. That's growth, and it began with the Industrial Revolution some centuries ago.

MR. MILLER: That's kind of a simple answer — a simple-minded answer, if you ask me. "It's just a result of rationalization, " says the minister. He has the power in the Forest Act, which he has never, ever exercised....

[11:15]

Here we have a company, moving from offshore to purchase two existing forest companies in British Columbia, which made a commitment to this government that there would be no job loss. That was a commitment. It wasn't a commitment? If it wasn't a commitment, why wasn't it? Why didn't the government demand that? Why didn't the minister act in the interests of the people who work in the industry in British Columbia? He won't do anything when it comes to major forest companies. They pull your chain, Mr. Minister, and it's pretty clear. This is a clear example.

Here we allow a major forest company to come into British Columbia, make a commitment — we thought it was a commitment — that there would be no job loss, and now the minister calmly stands up and says: "Oh, it's just rationalization. This is evolution." This is the evolution of the forest industry under this government. The evolution of the forest industry is to see jobs lost and the resources of the province put under the control of major companies.

Why didn't the minister exercise some authority under his act in this issue? Why is the ministry now requiring an audit to be done? He tells this House: "We're in charge. Careful planning. Don't worry, we're minding the store. We're taking care of business." Now he says: "I can't really talk about it because we're doing an audit." Have you no confidence in the work you were doing before, Mr. Minister?

Interjection.

[ Page 8569 ]

MR. MILLER: Lots of confidence.

MADAM CHAIRMAN: Would the member please address his comments to the Chair.

MR. MILLER: Thank you, Madam Chair. No confidence in the work your ministry was carrying out? I'm speaking through the Chair; I can look at the minister, I presume, without breaking any rules.

Why, Mr. Minister, did you not exercise some authority? Why did you not, for example, seek from that company, prior to approving the licence transfers, some commitment for British Columbians, for people who work in this province in this industry? What did you do — just say that whatever they wanted they could have? Do you not think you could have demanded some things that would have been beneficial to this province, rather than allow a company to come in and say: "Well, we're just going to rationalize. After all, it's evolution"? If the big timber is running out.... We'll come to that too, in terms of what's available in this province. What about reinvestment? What about new mills? What about mills that are capable of handling a different profile of timber, making value-added products? I note your comment yesterday. For a piece of wood that goes into a pulp mill, you get the same jobs per cubic metre in a pulp mill as you do...

AN HON. MEMBER: Paper.

MR. MILLER: ...paper mill as you do in a lumber mill. I don't know what lumber mill he was comparing. Certainly not a value-added plant. Why didn't you, as the minister responsible, sit down with Fletcher Challenge and examine what they proposed to do? Look at it from the point of view of the people of this province. Say, "We're not prepared to transfer these licences which represent an incredible value, incredible wealth," and say: "We think it makes sense. You've got an outdated mill here. It needs to be upgraded. Maybe we need a new mill here." Why didn't you go through that exercise? Perhaps you can explain that, Mr. Minister.

HON. MR. BRUMMET: I too have a few questions of the Minister of Forests. I have to ask him first of all if he supports the NDP position that there should be no logging on private land and that there should be no logging on watersheds, and that there should be....

MR. MILLER: On a point of order, that is not the position. It was never stated in this House. We have never said we were opposed to logging. We were talking about control.

MADAM CHAIRMAN: Hon. member, that is not a point of order. Would the Minister of Education please continue.

MR. BLENCOE: Tell the truth.

MADAM CHAIRMAN: Would the member for Victoria like to withdraw the comment he just made.

MR. BLENCOE: Madam Chairperson, if the minister was accurate, I wouldn't have to make such remarks.

MADAM CHAIRMAN: Would the member please withdraw the comment.

MR. BLENCOE: I withdraw the remark.

MADAM CHAIRMAN: Thank you. Would the minister continue.

HON. MR. BRUMMET: There seems to be a great view on the other side that they can use whatever interpretations suit them, but should anyone on this side interpret their interpretations as we see them, then apparently there's something wrong with that. I heard that member this morning say: "Why don't you control logging on private lands? Why don't you take away the rights that people have acquired in property ownership? Why don't you stop it, because it doesn't suit our purposes." I guess it goes clearly along with the philosophy of the NDP that private land ownership should not exist. It should be complete government control. Maybe the next thing is whether they should be allowed to build a house on it, and they object to that in other cases....

Anyway, I'd like to get back to my questions to the minister: what if you in fact would stop or, to concede a point, do a major reduction on logging on private land, as the NDP would have it; that you would eliminate logging in watersheds; that you would eliminate clear cutting. They have made it fairly clear that the people are against clear cutting. I would say in my liberal interpretation that they also seem to take the position that you shouldn't cut any trees that won't grow back to full size in five years, because that creates a scar. If you did all that, what effect would that have on the number of jobs in the forest industry? What effect would that have on the revenue that is needed to support the health, education and social services in this province if, as I would see it, many of the jobs would disappear in the forest industry?

Isn't it interesting that the member in his latter part was asking you why you don't tell them to upgrade a mill. Why don't you tell them to build new mills? Why don't you make them do this? But don't give them any assurance that there will be any logs to service that mill. I find it most interesting. I guess it's socialist philosophy. Make them cut lumber that isn't selling, but don't let them put it into pulp which is selling. I guess that's the socialist philosophy.

I can well remember during the 1983 election campaign when mills were shutting down because lumber wasn't selling and the NDP platform was that they would spend $500 million to keep the mills operating. What for? To stockpile lumber that nobody was buying? We have this view with the logging industry — I guess, the socialist view — that when

[ Page 8570 ]

they're talking to the loggers they say they will preserve logging jobs. When they're talking at other positions, they say they will have no more desecration by logging in this province. So loggers are going to keep their jobs by not cutting down trees, as near as I can understand It.

The big issue about private lands. I would like to ask the minister: what effect would all this NDP philosophy have on jobs for the IWA members? What effect would it have on revenue for the government? They put one out at a time but they never connect them together. I guess you don't have the luxury, Mr. Minister, of taking each one of these in isolation and making your own case about it. You seem to have to connect it into one comprehensive plan.

MR. BLENCOE: Through the Chair.

HON. MR. BRUMMET: Oh yes, of course, through the Chair.

So much issue is made about the private lands. I would like to ask the minister if he could tell me how many sales have been made privately in recent years to the forest companies, in order to give them the right to log? How many private sales have been made? At least in my experience, it seems that most of the private holdings were made some years ago.

Interjection.

HON. MR. BRUMMET: He says: "Why don't you do anything about the private lands?" Well, how many private lands have you sold in recent years? Perhaps with that, maybe the minister can give us some indication of how we can have a shutdown in all of the areas in logging that the member has put out, one after another. How could we have that shutdown in logging and maintain the forest industry and the jobs there?

I suppose the other question is: should you not, Mr. Minister, force those people to produce products that are not selling, just because it's good for NDP policy?

HON. MR. PARKER: Madam Chairman, one of the questions the Minister of Education asked was: how many private sales of public lands and public forests to industry have taken place? I can tell you that none have taken place. The disposal of public timber into forest licences, tree-farm licences and timber sale majors: these are all replaceable licences done by bid proposal and by public tender; so are pulpwood agreements done by bid proposal and public tender. There is substantial advertising process, substantial public input process, and a public hearing process. And before anything happens after that, there's a series of public processes. Nothing is done in private.

The Minister of Education's concerns are my concerns as well. The members opposite try to be all things to all people. They tell the preservationists: "Yes, we endorse your preservation tactics." Then they tell the unions — at least the IWA: "We're going to protect your logging jobs, and we're right onside with you." They're so busy straddling everything that I think they're going to high-centre themselves and may do themselves some physical damage. I'm sure that damage will be evident in the next election.

The issue of Fletcher Challenge and the Victoria sawmill is one where when the consolidation was put forward to us about Fletcher Challenge acquiring BCFP and Crown Forests and putting them together, they told us at the time that as a result of consolidation, and solely consolidation — and this is what was in their press releases and in the message to the employees at the employee meetings — no job loss is due to consolidation, but there would be subsequent review of how the two companies blended together, and there would probably be some rationalization.

Interjection.

HON. MR. PARKER: The member opposite does not care to share all of the facts; it seems to be his hallmark — partial truths.

The employees displaced from the Victoria sawmill.... The last discussion I had several weeks ago with Fletcher Challenge reps was that some 80 percent had been placed. Similarly, Fletcher Challenge closed the mill in Lumby in the interior. There also they went to great lengths to place everybody who wished to be placed. Some wished to take early retirement, and the employer provided the necessary bridging to make it possible in their pension plan arrangements for these folks to take their early retirement.

[11:30]

Those are the concerns that we have in the Ministry of Forests and in this government. We understand, from time to time, that a business decision can be one where you establish; other business decisions are that you have to close a mill. In each and every case, we are concerned about people: the jobs , what becomes of the people and how they're looked after. The efforts by Fletcher Challenge have been substantial in placing over 80 percent of those who wished to be placed and were prepared to perhaps move to nearby communities with other conversion plants or maybe undertake a new career. But their employer worked with them diligently and continues to work with those who are yet to be placed.

The issue really covers the whole spectrum of the forest industry. It's not just the majors. Small operators, from time to time.... There are fewer and fewer, because that's the way things have evolved in the last 40 years. There are fewer and fewer small operators with what they call a quota or a replaceable licence. Several of those, in the last couple of months, have asked for the opportunity to sell their mill, close their mill, and we've reviewed those situations in the same manner in which we reviewed the request from Fletcher Challenge.

If there is employee displacement, we are in discussions with the licensees in those cases. It doesn't mean that because somebody is no longer working in a sawmill that they are unemployed. The

[ Page 8571 ]

employer may make it possible for the employee to transfer to another division, if it's a major firm, or the employer may have a means of placing that employee in a new job opportunity. Those are concerns we have; we share them. Fletcher Challenge has gone to great lengths to place all displaced employees from the Victoria operation and they continue to manage TFL 46 in a proper manner.

The TFL 46 management and working plan conditions and development plan conditions have been met, the audits done by our staff have been ongoing, the reviews by the chief forester and his staff of their performance have indicated to us and continue to indicate to us that the licensee is meeting the terms and conditions of the contractual obligations they have. And the reason for the audit is to appease the council of Victoria and the IWA-Canada local here in Victoria. They had asked for an audit and we said: "By all means. The Ministry of Forests would be quite prepared to fund an audit." The person chosen for the audit was one who was acceptable to all parties, and he's had a free hand unimpeded by this ministry to conduct that audit — both a paper audit and a field audit. We will have the results about the end of the month, and following that we'll make them public.

[Mr. Pelton in the chair.]

There's no problem talking about the audit or the circumstances on TFL 46. In my opinion TFL 46 has been managed in a proper state, and the staff in the Forest Service tell me that the obligations have been met. As far as the audit is concerned, I'll be very surprised if we find anything different than what our staff have determined in their ongoing management duties.

MR. MILLER: I can understand why the Minister of Education (Hon. Mr. Brummet) feels he has to come in here and play defence for the Minister of Forests; the Minister of Forests certainly needs it. But the Minister of Education is out a mile. We've seen the results in British Columbia of no management, and that is jobs down the drain under this administration. The minister keeps talking — and maybe this is the direction — of reconstituted wood. It's clear that's where they're heading — paper, paper, paper, reconstituted wood. Never mind this incredibly valuable natural resource we have in this province.

Stick around, Mr. Minister of Education. I want to talk to you about countries that take a much more intelligent approach to resource management; about the Scandinavians who in fact did stockpile pulp during the term of the recession and did quite nicely, thank you, far better than British Columbia in terms of how they managed their pulp industry; about the Japanese who can buy wood from British Columbia at double the price, ship it all the way across the Pacific, turn it into finished products and make a profit. And the best we get from this minister is reconstituted wood. It's like regurgitated Socred policies.

MR. ROSE: That's a little harsh.

MR. MILLER: My colleague for Coquitlam-Moody says I'm a little harsh.

I'll go back to the minister's policy of appeasement. We'll have to appease the Victoria city council; we'll do an audit. We're not serious about it, we know we're right all along, but we'll do an audit.

The fundamental point is that the ministry was in charge. Let's go back before Fletcher Challenge. Those companies have to file management and working plans and the ministry is supposed to approve them. The ministry presumably was aware of the level of cut and of the changing profile. We give our resources to private companies and we demand certain things in return. Where was the ministry in terms of the management and working plans in saying: "Look, this log profile is changing. Where are your plans for a new mill? Where are your plans for value-added?" Where was the ministry in terms of those vital questions, instead of this sop, this doubletalk from the Minister of Forests.

AN HON. MEMBER: Come on!

MR. MILLER: Yes, double-talk at the time of the takeover. He attempts to rationalize and explain away Fletcher Challenge's position. Oh no, he said, there would be no job loss as a result of consolidation, which presumably meant that this company would come in, take over two existing companies and consolidate and there would be no job loss, but there might be job loss as a result of rationalization. What kind of explanation is that? Was that satisfactory to the minister at the time? Is the minister saying Fletcher Challenge informed him there would be job loss as a result of the takeover? Is that what the minister is advising this House?

HON. MR. PARKER: I pointed out earlier that the communications package Fletcher Challenge provided to the public, the press and their employees said there would be no job loss as a result of consolidation. Subsequently there would be a review of the two companies coming together and probably some rationalization. At the time they had no idea where that would take place, how it would impact, whether there would be closures or whether there would be additions. They were upfront about it, they shared that information, and today we are seeing the results of their rationalization.

The timber profile of the province is changing, and it is one that has prompted the development of a substantial business in engineering, engineering consulting and the manufacture of sawmill components, particularly programmable machine centres and controls. Evolution is a result of man's intelligence, and it usually comes from those who have some sort of initiative and personal drive. It is sadly lacking with the socialists opposite, because they try to think collectively and get off on tangents. The progress in the world today comes from individual initiative, from free thought.

[ Page 8572 ]

This government has instituted a timber-pricing system that fairly reflects the values of stands of timber as they exist in the province today. The pricing is such that licensees and operators have to make the best dollar they can from this expensive wood, and to do that they have to look at all the alternatives. Each enterprise has its own business plan and marketing strategy, and they have determined what market niches they wish to serve. It is up to the private sector, having determined from the general public what sort of products they are seeking, to determine what will be manufactured and how it will be manufactured. It's not up to the Ministry of Forests to tell anybody that they shall have a certain type of machine that was manufactured in a certain place, pay a certain dollar for it, and do certain things with it. It's entirely individual initiative, individual being a person or a corporation.

Individual initiative is what has formed the foundation of this country and the foundation of the free world, and now it's repairing the foundations of the socialist world. They see that to succeed they have to get into the same sort of thinking, the same opportunity for individual initiative and effort.

MR. MILLER: I didn't realize the minister was a scholar, Mr. Chairman. Perhaps he would write a book on the sayings of the Minister of Forests.

I'm intrigued by the response of the minister that it's not up to the government or the Minister of Forests basically to do anything. It surprises me. We had a major royal commission in this province in the forties — the minister rejects it at this point, but nonetheless it was a major commission — which recommended that we follow a certain path to gain certain benefits. We don't, or we shouldn't — maybe the minister does — take the simplistic view that we simply give our timber to a private company, and it's really up to them to determine what they're going to do with it. We have a Forest Act that requires doing some pretty careful things in terms of the company submitting management and working plans. Surely, Mr. Minister, employment is one of the things we seek from the exploitation of our resources. Surely employment is a paramount consideration.

[11:45]

I repeat: your ministry approves the plans of the company with respect to harvesting. We granted tree-farm licences on the basis that we would get processing. Why did the ministry not, in terms of TFL 46, recognize what was happening and say: "Look, we want value for our resources. We want jobs for our resources. Why are you running that outdated plant? What plans do you have to reinvest the profits you're making from exploiting our resources in plant that produces a higher-value product?" I don't accept for a moment the ridiculous notion that high-value wood products manufactured from the fine timber we have in this province aren't commodities that are desired on world markets. They are, so much so that Asian countries are buying our logs. Why did you not, in the course of your responsibilities as minister, demand those kinds of things from this company?

HON. MR. PARKER: Mr. Chairman, the Ministry of Forests is responsible for the management of forests on Crown provincial lands in provincial forests. That's our mandate, and we do it very well. There are some 3,400 people working in our ministry doing their jobs abundantly well.

Management and working plans of forest licences and tree-farm licences are reviewed on a five-year basis and include a very significant public review process. Then we have the development plans that evolve from the management and working plans, which are a five-year plan as well; but they are reviewed every year. They include a provision for public input. So there is a substantial amount of public input opportunity and a substantial review process involving both the licensee and the licenser — the Forest Service being the licenser.

We are very much concerned about employment levels, economic development opportunities and diversity in the forest industry in the province, because they help to shield us from the cycles of the various segments of the forest industry.

We have instituted a small business forest enterprise program under section 16(1) of the Forest Act that espouses and encourages value-added opportunities in the province. The pricing of the timber resource of British Columbia is such that licensees must now take a very close look at what they're doing with the raw material and extract the best possible return from it. We see a trend away from commodity items, not just lumber and studs, and more interest in highly value-added products, not only in the solid wood industry but in the reconstituted-wood industry.

The leadership offered by this government is substantiated by growth in the number of jobs in the forest industry. We have statistics for the years '87 and '88. There was a decline in '86, a decline in '85 and a decline in '84; there was an increase from 1987 to 1988. That increase is partly because of markets but also because of opportunities. The pulpwood agreement opportunities that have been put forth in the province and the continued vigilance on the part of the Forest Service in the utilization of the resource have resulted in a growth in employees.

There is a gradual swing away from commodity items to value-added items and reconstituted-wood items. We see a substantial amount of interest in medium-density fibreboard, which is a product which is relatively new to this part of the world but common in Europe. We have a good, growing opportunity in the Pacific Rim markets for medium-density fibreboard.

There is an enterprise that's looking very seriously at establishing an MDF plant in the Cariboo, using waste wood and also generating electricity in the power boilers and the steam boilers for processing the medium-density fibreboard. There is another outfit that's interested in a medium-density fibreboard plant in the Hazelton area, which would be

[ Page 8573 ]

significant for that area because of the high amount of decadence and the difficulty in creating any sort of solid-wood products from the type of timber available in the area. It certainly is good fibre for reconstituted-wood products such as medium-density fibreboard, particleboard or any type of waferboard, as well as pulp and paper.

The thrust of this ministry has been to present those opportunities to the private sector. They've seized upon them. We've seen very substantial investment levels — several billions of dollars — and we have some $4 billion of further investment indicated ahead for the forests of British Columbia. That will provide substantial levels of employment throughout the province and help to stabilize various regions of the province, because it's very much a regional perspective that we are taking.

MR. MILLER: The minister continues not to answer the question I posed, which is pretty basic. We have a government that views things this way. Along comes a major forest company from outside of Canada or British Columbia which says: "We are going to acquire some existing companies in this province. These companies have enormous holdings in Crown land in the form of perpetual licences. We are going to come in here and acquire these." And this minister and this government do absolutely nothing in terms of laying down some requirements that would be good for the people of this province — absolutely nothing.

The minister perhaps needs to be reminded about what is in the Forest Act under the heading of tree-farm licences, the power that the minister has and refuses to exercise: a company shall, if requested by the minister, provide "for the continuance, establishment or expansion of a timber processing facility in the Province." Where were you when it came to that? There is roughly the same requirement in the following section, talking about a tree-farm licence: "...require its holder... to undertake or continue the operation, construction or expansion of a timber processing facility...." You have the power, the right and the responsibility under the Forest Act. Instead you keep saying: "Oh, don't worry. We are in control; we know what's going on." But it certainly came as a surprise to the employees who were laid off. They obviously didn't know you were in control and knew what was happening. If you knew those layoffs were coming, I guess you were just keeping it a secret. It was just between you and the company, was it?

[Mrs. Gran in the chair.]

I repeat: why did the minister, who has the power, fail to demand from the company that acquired these licences protection — and, in fact, beyond protection, greatly increased employment opportunities, and not the general statement about so many billion dollars going into investment? We are talking about a particular location in this province where an overwhelming number of jobs have been lost.

Where was the minister? Why did you fail to deal with this issue? You clearly have the power to do it.

HON. MR. PARKER: In the discussions prior to agreeing to the acquisition of B.C. Forest and Crown Forest, discussions were held by previous ministers with Fletcher Challenge. The concerns, of course, were employment and investment and what sort of conversion plants would be put in place. Subsequently, when I came on the scene, they were already in place, and the consideration brought to me was one of amalgamation of Crown and B.C. Forest.

I shared the same concerns as my predecessors: what sort of things would be taking place? You see, I am Minister of Forests for British Columbia, not Minister of Forests for downtown Victoria, and Fletcher Challenge is a corporation that has operations all over British Columbia. The discussions we had were that as a result of bringing the two companies together initially — the consolidation — there would be no displacement and no jobs lost, but once the two companies were together, there would be a determination or rationalization of how the resources would best be used, because there would be conversion plants from one corporate entity and conversion plants from another corporate entity, which were quite a bit different, coming together — and how would they rationalize the wood supply to those conversion plants?

The determination subsequently was that the plant in Victoria and another one in Vancouver would be closed and the wood supply redirected — because they were all net purchasers, and they still are — to those plants which handle the wood most effectively, and there would be further investment in their plywood plant and their pulp mills and by addition of a newsprint plant in Mackenzie. Where people are being displaced, the corporation would place them within their corporation, somewhere in the province, and they would continue to have employment with Fletcher Challenge if they so wished. If they opted not to, if they wished to stay put and maybe work somewhere else, Fletcher Challenge would assist to place them. And where those who wished to take an early retirement, providing the employer bridged their pension plan, they'd do that. That's been done. Those are our concerns. The relationship between the employee and the employer is handled under their contracts and in their relationship. We do not get involved in between the employee and the employer; it's not in our mandate and not our place. It's an agreement between the two.

We continue to make job opportunities available throughout this province by meaningful policy changes and diligent management of the forest resources of the province. It's done by 3,400 very capable and loyal employees in the Ministry of Forests and the people of British Columbia.

The review of the performance of each and every licensee in the province continues on an ongoing basis by the ministry. Any substantial policy changes necessary are reviewed by the executive and myself, together with my colleagues in cabinet, and the

[ Page 8574 ]

results have been a very stable and growing industry and a substantial growth in employment in the industry.

[12:00]

MR. KEMPF: It's really interesting and slightly amusing to sit here and listen to the minister's lament about the multinational corporations in the forest industry, almost singing the song, "How Great Thou Art." How great thou art indeed.

It was interesting to listen to the Minister of Education (Hon. Mr. Brummet) get up and feebly try to support this minister. We've seen other cabinet members do the same thing, not standing on their feet but sitting on their seat. It's also interesting to see how many of the flock are here this morning to support that minister and what he's doing in the forest industry. They know what's happening, because they get it from their constituents, too.

It was interesting to hear the government House Leader say that the truth hasn't been heard yet. Well, let the first member for Kamloops (Hon. Mr. Richmond) get up and tell us the truth. What is the truth, Mr. Government Leader?

HON. MR. RICHMOND: Pay attention to what he's saying.

MR. KEMPF: Well, get up and support him if he's so right. We haven't heard the truth yet — you don't want to hear the truth. That minister sure doesn't want to hear the truth; there's no doubt about that whatsoever.

I was absolutely astounded when the minister got up this morning and publicly suggested what the audit on TFL 46 will say. That's an indication of what's going on and has gone on, as I said yesterday, for five decades in British Columbia with respect to our primary resource. That's the kind of political interference that has gone on in this province, except for a bit of a blip — and it was a very short blip indeed.

It's interesting, as well. to see how mild and collected the minister is, hoping to get through these estimates as unscathed as possible. How many lessons were you given in caucus, Mr. Minister? How many hours did they spend on you? It is so apparent it's sickening. No foot-in-mouth disease epidemic in these estimates, please.

MR. LOENEN: Do I have to listen to this?

MR. KEMPF: No, you can leave. Or you can get up and say something yourself, Mr. Member for Richmond.

Madam Chairman, a lot has been said about TFL 46 and the audit this morning, and we've seen audits before. We saw an audit on the Queen Charlotte Islands that showed quite conclusively that that company, MacMillan Bloedel, was in fact making a horrendous mess of the resources that belong to the people of British Columbia.

And what was done? A token fine, if you want to call it that — for a multinational corporation. It's not only on that tree-farm licence, but havoc was created out there for decades — for as long as can be remembered. You know, H.R. MacMillan said to the 1956 Sloan commission that that's what would happen if the timber were not in public hands, and at some point I'll quote those words.

What about the Gaines report on TFL 1? The minister has talked a lot this morning about management and working plans, and I quote Harry Gaines:

"Because of a weak Forest Act, the obligations of the licensee are restricted to those contained in the management and working plan. In the absence of regulations, the act assumes the conditions written into the management and working plan will ensure good forestry. Yet even if some commitments are written into the plan, even these may not be enforced due to political intervention by the Forests minister on behalf of the company."

And that's exactly what happens, Madam Chairman, all over this province.

The minister talked about a good staff — and yes, they are; they're probably the best, if they were only allowed to do their job, if there was only a discontinuance of the political intervention from Victoria into what happens out there in the field in the forest industry of British Columbia. Mr. Minister, talk as you like and hope to get through these estimates as quickly as you can, you know that that is the case — smoke and mirrors.

If you were so concerned about employment — and we'll talk again about TFL 46 — why did it take you six months between the time Fletcher Challenge told you that there would be shutdowns and loss of employment and when you came clean with the public? You didn't come clean with the public until such time as the story broke in the news media. Why didn't you come clean? And how many other situations sit on your desk now that you're not coming clean on with the people of British Columbia?

MADAM CHAIRMAN: Hon. member, I don't think that's a parliamentary remark. Would you like to withdraw "coming clean"?

MR. KEMPF: Call it what you like. If that offends the House, Madam Chairman, certainly I'll withdraw it. You can call it what you like; it still adds up to the same thing, Madam Chairman — six months between the time that the minister was in touch with the bosses at Fletcher Challenge and when he told the people of British Columbia what was going to happen there. Why? Then the minister comes in here this morning and talks about the management and working plans, and says he has no power to change them. The member for Prince Rupert (Mr. Miller) is absolutely correct. I wouldn't think it to be the case, but it would appear that the minister hasn't even read the act he operates under. He has the power to change management and working plans at any time. All it takes is some political will to change those plans; just a little bit of intestinal fortitude. You'd certainly do it if it was a small operator. You're doing it every day.

[ Page 8575 ]

I go back to the throne speech, which speaks highly of the small business enterprise program: "...additional opportunities to establish new businesses...." All that has happened to small business in the forest industry since this speech was read on the floor of this House is that they've gone broke. They're dropping like flies, as I said yesterday.

It's not just me or what the minister likes to call "the socialists, " because I think even the minister knows, as do all of the people of British Columbia, that they can hardly call me a socialist. They can call me a lot of other things, but surely not a socialist. I'm not spouting socialist ideals or philosophies. You can fool some of the people some of the time, but you're not going to fool all of the people next time around at the polls. Of that there's absolutely no doubt.

MR. MOWAT: Can I quote you on that one?

MR. KEMPF: Yes, you certainly can, Mr. Member for Vancouver–Little Mountain.

I'd like to just quote from "News and Views" of the Canadian Federation of Independent Business — hardly a socialist organization — from just three months ago. They suggest recommendations to the government of the province of British Columbia with respect to the forest industry. There are three short recommendations:

"(1) Control of the forest resources be kept in the hands of elected accountable representatives, and not be entrenched in the hands of major forest companies; (2) the government allocate at least" — get this, Mr. Minister; listen to this very closely — "50 percent of the annual harvest to a competitive bidding process, moving eventually to 100 percent..."

Where have you heard that before? Your staff has heard it before. They heard it around a big wooden table one Monday morning about three years ago.

"...(3) The government move immediately to deregulate the forest industry, in order to break up an excessive concentration of power."

I agree with them. That's my philosophy. It's not socialist. It's logical, fair and equitable for the people of British Columbia, not the multinational offshore corporations that operate here.

You don't have to go that far. All you have to do is go into your back bench and see what they're saying. Why aren't they here today? Oh, a few popped up all of a sudden. The flock came out awful quick; somebody opened the gate.

[12:15]

But where's the member for Cowichan-Malahat (Mr. Bruce), who on February 28, 1989, speaking to the Duncan Rotary Club, said: "I suppose the other thing that we as a society in British Columbia should start looking at is what level of corporate concentration — specifically when it deals with a public resource — is a good thing. I believe in private enterprise. I believe in the opportunity for the small guy to do what he can..."

MADAM CHAIRMAN: Hon. member, your time....

MR. KEMPF: "...and what he will. I wonder sometimes if the policies we are announcing and the policies we are following are in fact encouraging private enterprise." No, they're not, Madam Chairman, and I'll have far more to say.

HON. MR. PARKER: Early in his remarks the member for Omineca suggested there was a predetermination in the audit taking place. It's an independent audit taking place on TFL 46. There's no predetermination.

MR. KEMPF: Then why did you make the remark?

HON. MR. PARKER: I can restate it, and if the member can find somebody who can read to him, he can see in the Blues that I have confidence in the staff of the Forest Service that the reports, the investigations and the reviews that they've done on TFL 46 over the years have given us an indication that the licensing of TFL 46 met all of its obligations. I'm sure that will be borne out by the audit. That's confidence in the people who are doing their job for the people of British Columbia.

He goes on to talk about an audit on the Queen Charlotte Islands. That was a waste audit. The audit that's taking place on TFL 46 is a paper audit, in that it goes through all of the records on what was planned to be done and what was done and on reconciliation, as well as a field audit to determine exactly what has taken place on the land.

The audit in the Queen Charlotte Islands was a waste audit. It was waste that was accumulated prior to my time; some of it was accumulated in his time. The outcome was more than just a token fine. Licensees had to return to pick up usable fibre, wherever it was possible.

At no time in this House have I said that the Minister of Forests cannot change the management and working plan. He's wrong there again. The management and working plan is a document that's dealt with by senior staff and the minister. The management and working plan can be called for partial or entire review at any time by the licenser. We certainly did that in the issue that includes Carmanah.

He tells the house that small business in the forest industry has done nothing but go broke under our policies and under our government, and that's far from the truth. We see the member for Prince Rupert all upset about the Wedeene River sawmill at Prince Rupert and the way it's getting ahead and becoming established; that's a small business. In Port Alberni we see a family enterprise that's eventually going to be employing over 100 people; that's a small business. We see an enterprise going into the Port Hardy area for processing cedar that nobody else would touch; that's a small business. We see an enterprise going into the Richmond area that will utilize and remanufacture and value-add to alder products, employing physically disabled people in the process; that's a small business and it's very innovative, and it's an incredible initiative that we have a lot to thank

[ Page 8576 ]

the second member for Vancouver-Little Mountain (Mr. Mowat) for.

There are small business opportunities in Princeton, in Merritt, in Penticton, in the southeastern interior, throughout the Cariboo and where I live up in the northwest. The amount of activity in small business in the Peace River district is incredible. With the increase in woodlot opportunities in the province, there is going to be substantial growth from that standpoint. The opportunities in the real growth industry — pardon the pun — in the province is in the silviculture industry and the stand-tending forest renewal industry. That has seen substantial growth in the last couple of years.

So we see not only responsible stewardship but a good application of existing policies, an evolution of meaningful policies, to meet the terms and conditions of the times. We see opportunities presented for a very substantial future for people in British Columbia through the efforts of the Ministry of Forests.

MR. MILLER: The minister did say, in response to the questions on the audit, that it was quite clear that he felt the audit was simply an appeasement; that's the term the minister used. The audit was simply a way to appease the Victoria city council. It's surely a disappointment to Victoria city council that the minister has that view. If the minister, still without the benefit of that audit, strongly holds to the view that the company managed the lands well, that they did everything they were required to do, I guess we come to the next conclusion — if it's borne out by the audit that this is the case — which is that the requirements themselves were faulty, that there was some deficiency in terms of what the Forest Service required.

I want to go back to the decision taken by the government with respect to Fletcher Challenge's entry into British Columbia. I pointed out that under at least two sections — there is a third — the government has tremendous powers of suasion, of saying to companies wanting to come in and harvest our resources, wanting the opportunity to make a profit doing so, that there is an opportunity for us to in turn ask for certain requirements.

The minister talked about a newsprint mill. To the best of my knowledge, that decision was taken by B.C. Forest Products before Fletcher Challenge took them over. It wasn't made by Fletcher Challenge; it was in the works already. In fact, when I discussed it with the head of Fletcher Challenge, he expressed some concern about the decision. Had he been on the scene, he said, he wasn't sure he would have made it. So clearly that wasn't a requirement of the province.

The province didn't say to Fletcher Challenge: "We've got these tremendous resources. Obviously you think they are valuable; you want to come into British Columbia. What are you going to do for us? Let's sit down and discuss the needs of British Columbia in terms of jobs and employment and more value-added." It seems you didn't go through that process. Perhaps the minister wasn't involved. Did the government sit down prior to the takeover and discuss and put in place a request for specific levels of investment? Did the government sit down prior to the takeover and discuss specific upgrading requirements for operating plants which would be controlled by the company? Did the government sit down prior to the takeover to discuss and put in place requests in terms of specific levels of employment and alternatives or re-investment in plants where it could be foreseen that unemployment was going to result — specifically in Victoria?

Did the government do an internal analysis of the value of the Crown assets that would be transferred to Fletcher Challenge? Did we know specifically the value of the assets that we were transferring to this company?

HON. MR. PARKER: My predecessors and I all reviewed the business plans of the Fletcher Challenge corporation and determined what sort of conversion plants and where they would be investing in. Those are new plants. As to what was taking place with their existing plants, that was in their business plan.

When it came to an amalgamation of Crown Forest and B.C. Forest Products, they had to wait for a review of the consolidated company to learn what opportunities were ahead of the new amalgamated enterprise, what that offered and how that used the resources of British Columbia which were licensed to the two corporations in the past and were transferred in the amalgamation. The process was a long one of review and discussion.

Again, it's the private sector that has to determine where the market opportunities are, what they are, what sort of products they are, how they are to be manufactured, what sort of equipment is to be used, where is the best location to manufacture them and what species and grades of wood would best serve those markets and those processes. All that analysis winds up with the rationalization of where the extraction and the conversion of the raw material takes place.

We have reviewed those in depth with Fletcher Challenge. I disagree with the member opposite. The final decision on whether or not there would be a newsprint plant in Mackenzie was indeed that of Fletcher Challenge, the new owner of BCFP, and they decided to proceed with that plant. They've actually finished the first plant, and there's consideration for a second plant.

MR. MILLER: What specific level of investment was required by the British Columbia government before approving the takeover?

HON. MR. PARKER: We had numerous discussions on the business plans of Fletcher Challenge, and the revision of those business plans indicated very substantial levels of investment and substantial increases in job opportunities in the province. Those plans and goals were of a nature that we could agree to, and we did agree to them.

MR. MILLER: In other words, the company simply came and said, "Here's our plan," and you approved

[ Page 8577 ]

it. The government didn't undertake any separate analysis.

While I'm on my feet, it becomes very clear, each time the minister answers questions on this, that he was aware that the Victoria plant was destined to be shut down. Would the minister confirm that? Would he confirm that British Columbia did not make any specific requests to this company before allowing it to acquire these very valuable Crown assets?

[12:30]

HON. MR PARKER: At the time of consolidation I had no idea whether Victoria Plywood or the Victoria sawmill, or indeed any of the plants, would be closed. The Fletcher Challenge corporation advised me, as they did others, that they had to do a complete review of the amalgamation of the two firms, and then they would determine their plan of action from there. When they decided on what that rationalization would be, they provided their employees with six months' notice. The contract requires 30 days' notice, I think, but they offered six months' notice, and then they offered to assist to place those employees and to assist those who wished to take earlier retirement.

The last information I had was that some 80 percent of those employees were placed and the Fletcher Challenge corporation was assisting the balance in finding employment. The communication of their plan to their employees has to be done by the employer. They did it in a responsible, public and full-disclosure manner once all their rationalization studies were complete.

MR. MILLER: In other words, the minister was made aware by the company that there would be a rationalization and layoffs would result, and the company informed the minister that they would give six months' notice to their employees when it came time to advise them. They didn't tell you where the layoffs were going to be, but they told you there were going to be layoffs, they would give six months' notice and they would provide other assistance plans to those employees. Is that correct?

HON. MR PARKER: I was made aware of these plans about the same time that the employees were made aware of them — just in advance.

MR. MILLER: Did it ever enter the minister's mind that he should perhaps do a bit more? He didn't answer the second part of my question on the six months' notice. Was that something discussed while you were discussing with Fletcher Challenge their application? Is that one of the things they said to you, that they would give six months' notice?

Did the ministry make any demands in terms of protection for British Columbia workers, without knowing how many workers might be laid off, where, or what their circumstances might be? Did the ministry simply say: "Oh, yeah. Let us know. Or don't let us know." The minister just said: "I didn't know. I found out when the employees knew."

Is that the attitude you had in dealing with this company that obviously found British Columbia a very attractive place to invest? They obviously thought that there was incredible value in our forest resource. They came all the way over from New Zealand to buy out existing British Columbia companies. Clearly the books show now that their investment decision was a wise one; they're making millions.

Did you not try to be more specific with them? Did you not try and lay down conditions that should be met in terms of these employees? Did you not say: "That's unacceptable to us. If you discover in your rationalization that there are outdated plants, that's not good enough for us. We want you to reinvest, to build modern plants. We want you to put some capital in this province for the right to come in here and make a profit off our resources"? Why did you fail to do any of that kind of thing? Is it this simple-minded ideological position you have that whatever business wants to do is somehow correct, that you have no responsibility for protecting the interests of the people you are elected to protect?

It comes as a real shock to me that we have this kind of incompetence when it comes to dealing with major players. They somehow seem to be able to come in here and just walk all over successive administrations of this government and this party.

I think we have to pursue this and pursue the failure of the minister to deal in any kind of adequate way with the interests of British Columbians. They are not your resources, Mr. Minister, and they don't belong to your party, either. They belong to all British Columbians, and you somehow approach them without that sense of responsibility.

Why didn't you do the things that I have talked about? Why didn't you act in the interests of British Columbians?

HON. MR. PARKER: On several occasions this morning we have reiterated what has taken place in discussions with Fletcher Challenge on the matter of B.C. Forest Products and Crown Forest. The discussions were long and involved with my predecessors and subsequently with myself, and what we were concerned about was the utilization of the resources of the province, the levels of employment and the levels of investment. But we didn't dictate to them what that would be. We asked them what their business case was; we reviewed it and discussed it. They revised it; we discussed it. They revised it, and when we were both satisfied with the business plan, we agreed. As a result, we see substantially investment throughout the province by Fletcher Challenge, and we see substantial increased levels of utilization and value-added by that corporation and other major corporations, as well as small corporations in the province.

The realities of life are that we have diversity in this forest industry. There are large corporations and there are small corporations. Fletcher Challenge is out of New Zealand. They saw fit to invest in British Columbia, and invest they did. They can't take the

[ Page 8578 ]

trees away, and they can't take the plants away. They're here, and everything they've earned they have plugged back in. That's a matter of record; that's auditable; that's real; that's fact. I know the people opposite don't deal in facts; they deal in partial facts and convenient facts, but not real facts.

The investment and commitment to the province by Fletcher Challenge and, indeed, by all licensees in the province is extremely significant. When you get into the small industry, often as not it's a total commitment of just about everything — house, home, all savings and probably the wife's earnings too There's total commitment, and that commitment really is reflected in all levels of the forest industry throughout the province.

As I said before, we have a very diverse industry. It includes major international firms and small individual firms, and we will continue to foster that kind of diversity and those kinds of opportunities in this province.

Madam Chairman, I move that 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.

MR. KEMPF: Mr. Speaker, as I indicated earlier, I stand on a question of privilege.

Following remarks made in this House yesterday afternoon by the Minister of Forests in which he alleged that my comments regarding the Prince George timber supply area were based on information received from my son, who is employed in that region, I wish to have it on the record that his remarks were unbefitting the stature of this chamber. They were totally out of place and unfounded. Let the record show that I have been careful, in the extreme, to avoid involving my family in any of the work that I do as the member for Omineca.

His remarks, Mr. Speaker, have wider ramifications. All members of this House should be able to carry out their duties without fear of causing hardship to members of their families as a result of the work they do.

HON. MR. PARKER: On a point of order, Mr. Speaker, I'll quote from the Blues yesterday.

MR. SPEAKER: Order, please. There will be no point of order until the member finishes his question of privilege.

MR. KEMPF: I have discovered since last evening that my son has been harassed for the past while in everything he has done, and everything he has done has been called into question. This information has been substantiated by his colleagues. Is the minister going to vent his wrath on the entire staff of the Prince George region? My son has been an exemplary employee for the past 15 years. He is — or I should say he was — doing work which he enjoyed and which he has wanted to do from the time he was a young boy.

I ask you, Mr. Speaker: where does the potential for abuse of this system end? Are Members of the Legislative Assembly to be muzzled for fear of causing grief to members of their family, or could it extend to friends and associates also?

It seems fitting that on this day, July 14, the anniversary of Bastille Day, I am taking a stand for democracy. You can groan if you like, Mr. House Leader of the government, but I'm taking a stand for democracy and freedom of speech, possibly also for freedom of association.

The implications are horrendous. Do we go on to consider freedom of association? Do we go on to consider family? Will family and friends and associates of Members of the Legislative Assembly begin to wonder if they can be seen talking to them? Is that the case? Is there freedom of speech and association under this administration? I doubt it, after the remarks yesterday, Mr. Speaker.

Mr. Speaker, I rest my case. Let it be noted that this member believes that no one should be harassed on the speculation that they might be providing information to any member of the Legislative Assembly; and that all members should have the peace of mind to voice their opinions, and the opinions of their constituents, with impunity to themselves and those connected with them.

Mr. Speaker, I will table my motion, which I will move if you should so positively find.

HON. MR. PARKER: First off, I'd like the House to know that I have never had the privilege of meeting young Mr. Kempf; I have never harassed young Mr. Kempf; I wouldn't know the fellow to see him. The allusion that that member has made that I have harassed his son I find offensive, and I ask him to withdraw that, Mr. Speaker.

Furthermore, he was alluding to remarks in the House yesterday which I withdrew, and the House record shows that those remarks were withdrawn. They were in response to catcalls from the member for Omineca while he was seated, saying what he knew about the way the personnel of the Forest Service felt about the Minister of Forests; therefore I made the comment, which I withdrew. I wish the House to know that I withdrew that comment in good faith and out of respect for this House and out of respect for the member's son — and I did that without hesitation.

I really take offence at the suggestion that I was harassing his son, now or at any time in the past. I ask the member to withdraw that statement.

Interjections.

MR. SPEAKER: Order, please. I've listened to both the members on this question of privilege. I will review the matter over the weekend, look at the Blues and make a ruling on Monday.

[ Page 8579 ]

Introduction of Bills

MUNICIPAL AFFAIRS, RECREATION
AND CULTURE STATUTES AMENDMENT
ACT (No. 3), 1989

Hon. Mrs. Johnston presented a message from His Honour the Administrator: a bill intituled Municipal Affairs, Recreation and Culture Statutes Amendment Act (No. 3), 1989.

HON. MRS. JOHNSTON: Bill 75 contains amendments to the Municipalities Enabling and Validating Act and the Municipal Act. It contains measures designed to assist our municipalities in combatting insect pests.

This bill validates a city of Vancouver bylaw under which property tax penalties and collection dates have been deferred for businesses experiencing particularly severe 1989 tax increases.

The bill also makes provision for the transfer of the Whistler Conference Centre and golf course from the Crown provincial to the municipality. Under these special arrangements, the property in question will remain in the public sector and consequently will enjoy property tax exemptions. Operating costs will be covered in part by a negotiated allocation of hotel tax revenue and in part by contributions from the Whistler Resort Association.

This bill also contains a measure designed to help municipalities control the proliferation of graffiti.

Bill 75 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

SOCIAL SERVICE TAX
AMENDMENT ACT (No. 2), 1989

Hon. Mr. Couvelier presented a message from His Honour the Administrator: a bill intituled Social Service Tax Amendment Act (No. 2), 1989.

HON. MR. COUVELIER: Bill 81 amends the Social Service Tax Act to address the implications of the recent Supreme Court of Canada decision concerning the application of provincial sales tax to interprovincial and international aircraft operated in British Columbia. The bill confirms that from May 5, 1983, social service tax is payable by all interprovincial or international carriers, including airlines, in respect of conveyances and other property used by those carriers in the province, based on the proportion of their use in British Columbia to their total use.

It also places into the statute the formulas for determining the amount of tax payable by such carriers. It retains money paid as social service tax for the period 1983 to 1989 by those carriers, and it modifies — effective with the passage of this act — the social service tax payable for contractors and others bringing equipment into the province for temporary use, and lastly, it retains money paid as social service tax by those contractors and others in respect of equipment brought into the province for temporary use for the period 1983 to 1989.

Bill 81 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

TEMPORARY USE TAX
VALIDATION ACT

Hon. Mr. Couvelier presented a message from His Honour the Administrator: a bill intituled Temporary Use Tax Validation Tax.

HON. MR. COUVELIER: Bill 82 also addresses the implications of the recent Supreme Court of Canada decision concerning the application of provincial sales tax to interprovincial and international aircraft operated in British Columbia. This bill confirms that from 1960 to 1983, social service tax is payable by all interprovincial or international carriers in respect of conveyances and other property used in the province, based on the proportion of their use in B.C. to their total use. It establishes the formulas for calculating the tax payable by those carriers. It retains money paid as social service tax for the period 1960 to 1983 by those carriers, and it retains money paid as social service tax for the period 1960 to 1983 by contractors and others in respect of equipment brought into the province for temporary use.

Bill 82 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

FOOD CHOICE AND DISCLOSURE ACT

On behalf of the Minister of Agriculture (Hon. Mr. Savage), Hon. Mr. Richmond presented a message from His Honour the Administrator: a bill intituled Food Choice and Disclosure Act.

HON. MR. RICHMOND: The purpose of this legislation is as follows. It is a throne speech initiative to address consumer concerns regarding the use of synthetic materials in food production. While available food products meet high health standards, some consumers have expressed the desire for alternative standards. This legislation will provide a framework for the Minister of Agriculture and Fisheries to certify persons involved in food production and marketing who voluntarily wish to provide consumers food products with special characteristics or information about food products. The legislation will ensure that products offered to consumers by certified persons meet certain standards.

Bill 85 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

[ Page 8580 ]

ELECTORAL BOUNDARIES COMMISSION ACT

Hon. Mr. Reid presented a message from His Honour the Administrator: a bill intituled Electoral Boundaries Commission Act.

HON. MR. REID: This bill implements the recommendations of the Royal Commission on Electoral Boundaries of British Columbia. It is based upon the unanimous recommendations of the Standing Committee on Labour, Justice and Intergovernmental Relations that were adopted by this Legislative Assembly on July 14, 1989.

The bill provides a means whereby the precise boundaries that were recommended by the royal commission can be adopted at a time when the Legislative Assembly is not in session.

A regulation is established that the new ridings and their boundaries can only be made on the unanimous recommendation of the Select Standing Committee on Labour, Justice and Intergovernmental Relations under the bill. This must be done by January 31, 1990.

The bill also establishes an independent, non-partisan Electoral Boundaries Commission to regularly review electoral boundaries so that they will continue to reflect the basic principles of fair and balanced representation for all British Columbians. The new Electoral Boundaries Commission will carry out its mandate in accordance with the principles specified in the bill. These regular reviews will occur after every two general elections and will ensure that the boundaries of the electoral districts reflect the changes in population that have occurred in the interim and that the adjustments are made on a purely non-partisan basis. [Applause.] I am enthused by the reception for this motion. I move that the bill be introduced and read a first time now.

Motion approved.

Interjection.

HON. MR. REID: Do you want three readings now? With leave, Mr. Speaker.... Are you backing down?

MR. ROSE: We haven't seen it.

HON. MR. REID: This one you'll love. Mr. Speaker, I was going to set a precedent here and show leadership.

Bill 87 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Hon. Mr. Richmond moved adjournment of the House.

Motion approved.

The House adjourned at 12:55 p.m.