[ Page 9497 ]

CONTENTS

Routine Proceedings

Ministerial Statement

Western Premiers' conference. Hon. Mr. Vander Zalm –– 9497

Mr. Harcourt

Electoral Districts Act (Bill 3). Hon. Mr. Dirks

Introduction and first reading –– 9499

Park Amendment Act, 1990 (Bill 25). Hon. Mr. Messmer

Introduction and first reading –– 9499

Oral Questions

Premier's statement on Portage la Prairie conference. Mr. Williams –– 9499

Expo lands. Mr. Williams –– 9500

Earthquake preparedness. Mrs. McCarthy –– 9500

Privatization. Mr. Williams –– 9500

Mr. Sihota

Motions not on notice –– 9501

School Amendment Act, 1990 (Bill 11). Committee stage.

(Hon. Mr. Brummet) –– 9502

Ms. A. Hagen

Mr. Clark

Ms. Cull

Ms. Edwards

Mr. Blencoe

Third reading

Appendix –– 9526

The House met at 2:03 p.m.

Prayers.

HON. MR. RICHMOND: Mr. Speaker, visiting you in the precincts today are 32 members of the World Sugar Research Institute. On your behalf, I would like to welcome two of their representatives, Ann Cherniasky and Dora Tysoe, who are in the members' gallery this afternoon. Would the members please make them welcome.

HON. MR. BRUMMET: In the gallery today are Mr. Gordon Moffat, general secretary of the B.C. Principals' and Vice-Principals' Association, and Donna Palmer, director of professional development for the same organization. I would like the House to welcome these two fine examples of responsible educational leadership in this province.

HON. MR. STRACHAN: Mr. Speaker, I would like to have all members welcome Mr. Scott Bonner of Prince George, who is the executive director of Intersect, which is an organization dedicated to assisting youth who have a conflict with the law. Scott, over the years — and I have known him for some time now — has done a remarkable job in our community in terms of leading, directing and beginning social service agencies to the benefit of those less fortunate.

With Scott today are his parents, Charles and Sydnie Bonner, and they are from Victoria. Would the House please welcome them.

MRS. McCARTHY: I would like all members of the House to welcome a former member of the council of Saanich to our session today. She is a former alderman, an active former member of the Greater Victoria Chamber of Commerce, a very active booster for tourism for our capital city, an entrepreneur of great note in the city of Victoria — recently retired from her Island Florist business. She has been an entrepreneur who has been associated with almost every community effort to raise funds for good causes, such as the B.C. and Yukon Heart Foundation. Will the House please welcome Mrs. Norma Fitzsimmons.

Ministerial Statement

WESTERN PREMIERS' CONFERENCE

HON. MR. VANDER ZALM: Mr. Speaker, I would like to make a statement. I want to report to the House on the outcome of the Western Premiers' Conference, which took place on Monday and Tuesday in Portage la Prairie, Manitoba.

The conference dealt with a wide array of economic, environmental and social policy issues of importance to British Columbians and to other western Canadians. We agreed on a number of communiqués on these matters.

On Monday we discussed our grave concern about the federal government's fiscal and monetary policies, which we all see as posing the real danger of creating a made-in-Canada recession. The federal interest rate policy, which has resulted in nearly unprecedented spreads of almost 600 basis points compared to American rates, constitutes an overwhelming disadvantage to Canadian businesses and robs many Canadians of their dream of owning their own homes.

Higher interest rates also lead to a higher Canadian dollar. These together represent a double whammy for Canadians, threatening to wipe out the gains made after the recession of the early eighties and undermining the benefits of the free trade agreement.

We rejected the view that these policies can in any way be justified. We challenged Ottawa to demonstrate what possible benefits they represent for Canadians. We challenged Ottawa's fiscal policies in unilaterally offloading responsibilities for critical programs such as health, education, social assistance and regional development, while failing to get their own house in order.

We proposed that our ministers of finance work together with Ottawa and the other provinces to address the critical economic problems we face as a country.

We spent considerable time on Monday discussing the crisis in Canadian agriculture and farm finance caused by international subsidy wars and other factors beyond the control of farmers. Special reference was made to the situation faced by the British Columbia tree-fruit industry. Mr. Speaker, you can see that western Premiers pull no punches; we call it as we see it in standing up for the interests of western Canadians.

Our meetings also gave us the opportunity to review a number of areas where significant progress has been made through western cooperation. In such areas as economic diversification, environmental protection, science and technology, tourism promotion and development, trade policy, transportation, rural development and enhancing the family, western Premiers and western ministers have worked very effectively together over the past couple of years to promote the interests of the west.

Premier Filmon and I signed a letter of understanding regarding the TRIUMF kaon project at UBC. We already have an agreement with Saskatchewan and are continuing our efforts to bring this world-class project to fruition.

We spent considerable time yesterday continuing discussions begun in Vancouver on March 23 with respect to the current constitutional impasse. On the basis of those discussions, we will be pursuing further ideas with other Premiers over the next days in an effort to forge a national consensus which will not only resolve this impasse, but do so in a manner which significantly advances the goals and aspirations of all regions of this great country — most definitely including those of British Columbians and western Canadians.

[ Page 9498 ]

As I indicated in proposals made public in January, I concluded some months ago that we must move on together as Canadians to renew the spirit of constructive compromise and accommodation which built this country. This effort must entail creation of a consensus in the country on a broad basis and involve movement on issues of key importance to the west, most especially Senate reform.

This is no longer a question of saving Meech Lake. There is a much broader and more significant issue at stake today. We must now respond to the concerns and objectives in all regions of the country for renewing the national consensus and reforming our national will to build this country together.

Mr. Speaker, it is not clear whether the efforts that my fellow western Premiers and I are continuing to undertake will hold the key to unlocking this particular problem. I break no confidences in saying that we believe that the possibilities for reaching a renewed, more broadly based consensus are real enough that we should continue our work.

Certainly British Columbians will agree that no effort should be spared on an issue of such central importance to our future as Canadians. I and my fellow western Premiers are united in our dedication and determination to undertake those efforts on behalf of western Canadians and on behalf of Canada.

The Meech Lake accord, without additional accommodation of regional interest, will not likely proceed by June 23. It cannot succeed in its present form, but further initiatives can see us yet achieve meaningful constitutional reform. That reform must be directed to one basic goal we all share: to reaffirm and support our great nation and maintain Canada as a unified and truly great country.

The differences we have in this House are a reflection of the benefits and values of the constitutional democracy we enjoy and must maintain. We must all affirm a common commitment to our Canada and do all in our power and influence to keep this country together, to maintain a great, rich and complex country which stands in this world for the principles of democracy and individual rights and freedoms.

[2:15]

Mr. Speaker, my goal as Premier, and the goal of all members on this side of the House, is to play a positive role, be a positive force and, if necessary, assert a leadership role in securing the future of our province within a strong and unified Canada. We are trying to generate a set of new ideas and new options, such that our new generations of British Columbians can secure and celebrate their futures as Canadians.

British Columbians are strong and proud Canadians. Our people want us as legislators to ensure the fair and equal treatment of all individuals and all provinces. They also want us to maintain and improve our position in Confederation. But most of all they want us to preserve and protect the nation that we share. We will not swerve from that course.

I asked my fellow western Premiers to meet in Vancouver during Globe '90, on March 23. My purpose in calling that meeting was to try, through joint initiatives, to build a consensus on constitutional reform. It is not so much the specific details of Meech Lake or companion resolutions as the willingness to realize that nation-building is an ongoing process that demands a long view and an unwavering commitment to our country.

Mr. Speaker, this Premier and this government will maintain that course. The process is not yet complete. Further consultations are required, both with other first ministers and with the public.

MR. HARCOURT: Mr. Speaker, I'd like to thank the Premier for his report to the Legislature on the western Premiers' meetings. On this side of the House we welcome the Premier's efforts, along with the other western Premiers, to stop the high-interest-rate policy of the Mulroney government.

We thought we were getting rid of the Crow rates on freight, and we were cruelly misled. We now have the Crow rates of the central bank having a very serious impact on the western economy.

The Premier spoke about the freedom and democracy that we enjoy in this great Confederation of ours. He spoke of the discussions that took place on making sure that this country remains strong and united. I'd like the Premier to know that while he was away, his Finance minister was turning the future of this country into a dollars-and-cents issue. He didn't speak about a great Confederation. He didn't speak about freedom and democracy. He spoke about the costs to British Columbia being in the negative.

As you're aware, this Finance minister has been reeling for the last two weeks with the disclosures of a dishonest budget by Peat Marwick, the certified general accountants and the auditor-general. The BS fund was exposed as just that, and the auditor-general's report made it very clear....

MR. SPEAKER: Order, please. Would both members please take their seats.

Once again, I must remind the members that when a ministerial statement is made, the reply must be within the scope of the statement. The statement was pretty broad, and there were a number of things there. But there was nothing about the budget. Hard as I try, I can't find anything relevant in terms of the reply.

So I would ask the Leader of the Opposition to continue, but I remind him that the comments he makes now must be relevant — and there has been quite a broad degree of scope allowed alread y— to the statement originally made by the Premier.

MR. HARCOURT: With that guidance, Mr. Speaker....

I listened very carefully to the remarks of the Premier. He spoke about freedom, democracy and a strong Confederation. He spoke about the financial issues that are plaguing the western provinces. While he was away, I thought I would remind him when he

[ Page 9499 ]

returned about the financial problems that are plaguing this province of ours and this government.

I think it is a very relevant comment. As the Premier used his high-flown words about the freedom and democracy we have in this country of ours, and how important having a strong united Canada is, his Finance minister was undermining his efforts to have a united Canada. He was bashing Confederation. I would hope that when the Premier is a thousand miles away from British Columbia he would, before he left, remind his ministers to work on nation-building rather than mischievousness — and remind him that he once again was wrong, that the figures from Statistics Canada made it very clear that in 1988 we were not in a deficit situation in this Confederation of ours. I think people are entitled to know the facts.

In conclusion, I would hope that when the Premier goes to Manitoba, and his Finance minister is here being irresponsible at a very delicate time for this country and our constitutional dialogue, he would make sure his Finance minister is making sure that B.C. gets a fair share in Confederation, such as fighting for the Polar 8 at the right time instead of after the fact, fighting for FRDA II and making sure that they fight the GST not at the end of the process but at the beginning, as New Democrats have been doing.

HON. MR. RICHMOND: On a point of order, Mr. Speaker, surely even this Leader of the Opposition could take your warning to heart and stay relevant to the Premier's statement. He has wandered all over the map, and I suggest it's time he concludes his feeble response.

MR. SPEAKER: In the remarks of the Premier there were a number of issues that were brought up that we skated close to, but the Polar 8 was not among them. If you could continue....

MR. HARCOURT: I'll sail by the shipyards, and say that I would hope now that this Premier is back he would at least sit down with his beleaguered Finance minister and tell him to get his financial facts — for once in the last two weeks — right.

Introduction of Bills

ELECTORAL DISTRICTS ACT

Hon. Mr. Dirks presented a message from His Honour the Lieutenant-Governor: a bill intituled Electoral Districts Act.

HON. MR. DIRKS: Mr. Speaker, this bill will complete the process of electoral boundary reform which was commenced when the government asked the hon. Judge Fisher to make recommendations for reform of electoral boundaries and the elimination of two-member ridings.

Subsequent to Judge Fisher's report, the Select Standing Committee on Labour, Justice and Intergovernmental Relations made a unanimous report recommending the names and the boundary descriptions of the 75 new electoral districts. This was done on October 31, 1989. Subsequently, the Lieutenant-Governor-in-Council was pleased to enact a regulation establishing the 75 new ridings, together with their names and legal descriptions. This was done on January 24, 1990.

This bill honours a commitment of the government to incorporate these changes into legislation at the present session of the Legislature. This bill sets out the names of the new districts. It establishes the boundaries of the 75 electoral districts. It repeals the January 24, 1990, regulation. The act will come into force upon the dissolution of the thirty-fourth parliament.

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

Bill 3 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.

PARK AMENDMENT ACT, 1990

Hon. Mr. Messmer presented a message from His Honour the Lieutenant-Governor: a bill intituled Park Amendment Act, 1990.

HON. MR. MESSMER: Mr. Speaker, the purpose of this bill is to improve government protection of more provincial parks by legislating their boundaries. The bill adds a schedule with 23 parks to the existing schedule of parks, with legislated boundaries. Following proclamation, there will be 103 parks with boundaries entrenched in legislation.

This bill also undertakes minor housekeeping matters.

Bill 25 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Oral Questions

PREMIER'S STATEMENT ON
PORTAGE LA PRAIRIE CONFERENCE

MR. WILLIAMS: I have a question to the hon. Premier. I listened with interest to his statement since Portage la Prairie. Could the Premier advise us what a basis point is?

HON. MR. VANDER ZALM: Mr. Speaker, I would defer that question to the Minister of Finance.

HON. MR. COUVELIER: Mr. Speaker, I really find it astounding that the chairman of one of the credit unions in the province of B.C. should be so unaware of the answer that he has to ask the question in such a public forum.

[ Page 9500 ]

MR. WILLIAMS: Is there anybody in the cabinet ranks who could answer the question?

HON. MR. COUVELIER: First of all, I make no great pretence to being a financial expert. As I've said a number of times, on this side of the House there are probably at least 35 individuals who could do the job equally well or better. They've all got a vast amount of experience in the financial community. I just happen to be the MLA who holds the job at the moment. But I can guarantee you, Mr. Speaker, that any one of the people on this side of the House could do a better job than any one of those people on the other side of the House, particularly given the fact that the alleged financial expert on the other side doesn't know the answer to such a simplistic question. I find it astounding that this person could have won the position through some sort of electoral process when his ignorance of the process itself should be such an obvious matter of public knowledge now.

[2:30]

In any event, Mr. Speaker, just to put an end to this question, 1 percent equals 100 points.

MR. WILLIAMS: A little humble pie is good, Mr. Minister of Finance. Thank you.

EXPO LANDS

MR. WILLIAMS: A question to the Premier regarding Expo lands. Are there unresolved liabilities that the government still has with respect to non-performance on the Expo lands?

HON. MR. VANDER ZALM: Mr. Speaker, I didn't get the last part of the question. There was too much noise over there.

MR. WILLIAMS: Are there unresolved liabilities still remaining with respect to Expo lands?

HON. MR. VANDER ZALM: Mr. Speaker, first of all, if I might take this opportunity, I'm a little astounded that after a statement that I think is of considerable importance to the people of British Columbia and the country....

Interjections.

MR. SPEAKER: Order, please. Question period is 15 minutes long. If you have a remark that you wish to make about your earlier statement, the appropriate time to do that would be after question period. Please proceed.

HON. MR. VANDER ZALM: Mr. Speaker, my reference would have been with respect to the purpose of question period, which is for matters of importance and of immediate concern. But I will defer this question to the minister responsible.

HON. MR. PARKER: I'd be pleased to take the question on notice.

MR. WILLIAMS: Can the Premier assure us that the Minister of Crown Lands is the minister responsible for the Expo lands?

EARTHQUAKE PREPAREDNESS

MRS. McCARTHY: Mr. Speaker, my question is for the Solicitor-General. Vancouver residents are very concerned regarding reports that in the neighbourhood of $11 million may be required to make our city bridges in Vancouver earthquake-proof. Can the minister tell this House what the government is doing to ensure the safety of all bridges in this province, to make sure that we are ready and prepared for an earthquake?

HON. MR. FRASER: Mr. Speaker, the first point I would like to make regarding the question is that I, personally, never use the expression "earthquake-proof." You might want to use "earthquake-resistant," which I think is more reasonable.

Secondly, with respect to earthquake preparedness, as you know, the ministry spends a great deal of time and energy trying to raise the level of awareness about the possibility of earthquakes and what to do before, during and after. This, of course, has involved the city of Vancouver examining its bridges to make sure they are more earthquake-resistant than they are now.

This has also been a subject of discussion and effort and expenditure by Crown corporations like B.C. Hydro with its dams, the Ministry of Highways with highways and bridges, the Ministry of Health and all kinds of other ministries. So an expansion of your question is: yes, the government is making all kinds of efforts to ensure public safety in the event of an earthquake.

PRIVATIZATION

MR. WILLIAMS: To the minister responsible for privatization. We paid $240,000 more last year for privatized signs that we didn't receive in the Ministry of Highways, but the privatization task force showed earlier that the public company cost us only $25 a sign. Has the minister's staff reviewed those differences and added up how much more privatization is costing us now than previously?

HON. MRS. GRAN: Mr. Speaker, I'd be happy to bring the answer back to the House.

MR. SPEAKER: Question taken as notice, I presume.

MR. WILLIAMS: Last year, the Ministry of Environment paid $180,000 for privatized lab services that it never received. Has the privatization staff added up the added costs here and determined whether the Crown indeed benefited through privatization?

[ Page 9501 ]

HON. MRS. GRAN: Again — and I don't like to seem to be avoiding answering your questions — I'll take this on notice.

MR. WILLIAMS: Final question to the minister responsible for privatization. The Premier noted earlier that there would be phases 2, 3 and 4 of privatization. Has the minister's staff determined whether this rich province can afford any more privatization?

MR. SIHOTA: Question to the Premier. No one insisted more than the Premier that the government proceed with privatization. He wanted, of course, to impose his political belief in privatization on us all. Yet in the latest auditor-general's report, the evidence as to that lab that my colleague referred to — insofar as the auditor-general looked at it — "concluded that the direct costs of the services provided during the first year of the contract were more than they would have been had the ministry continued to operate the facility." That's for the time period the auditor-general looked at this report. Would the Premier not agree that in this instance privatization actually cost us money?

If the Premier didn't hear, I'll reword the question. Would you not agree that in this instance privatization has been a costly experiment?

MR. SPEAKER: It would assist the Chair and all members of the House if the preambles were made shorter so that those who are listening for the question would actually hear the question and all the preamble.

HON. MR. VANDER ZALM: The question is very timely, because I had an opportunity to speak with western colleagues in Portage la Prairie. There is great interest, obviously, not only in the tremendous fiscal accomplishments of this province.... There isn't another province in western Canada — in the whole of Canada, for that matter — which has gone so long without tax increases. As a matter of fact, this year we have a tax reduction.

This did not come about because of any assistance that might have been received from the NDP. Only this morning I was adding up some of their demands, and they are anywhere from $3 billion to $10 billion. I expect to have a more accurate figure fairly soon. All of it adds up to doubling either the sales tax or the corporate tax, or a bit of both; and it certainly includes, as Mr. Krog said, a considerable increase in personal income tax.

In conclusion, I guess the privatization process has been tremendously effective and successful. I'm proud of a government that has been able to accomplish that and not only save money, but in many instances improve services and reduce the number of public servants, which certainly gives us flexibility that no other jurisdiction enjoys.

In response to this question and the earlier question, if we can effectively see some services that are now carried out by government, carried out in the private sector, save money and thereby have the ability to reduce taxes, this Premier and this government are all for saving the taxpayers money.

MR. SIHOTA: The Premier would rather listen to his political rhetoric than to the quiet logic of the auditor-general's report. He can't admit that he's wrong.

In August 1987 the Premier, when he was talking about privatization, said that "there won't be any fire sales, specials or giveaways." Yet with respect to the sign shop, the auditor-general says in the course of his report that we are paying $240,000 for signs that we're not getting and that we didn't even order. How does he reconcile that fact with the statement he made earlier about no fire sales, specials or giveaways?

HON. MR. VANDER ZALM: Mr. Speaker, the member will have an opportunity to ask about those specifics when that specific budget comes up for discussion, but I can again assure members on the other side that, yes, we have a saving in signs by having them done by way of tender as opposed to being committed to a fixed cost — number one.

It certainly needs to be mentioned as well that the sign shop is a special example of how, through the privatization process, we can create initiative, entrepreneurism and, above all, more jobs for our people.

Motions

HON. MR. RICHMOND: Mr. Speaker, with leave, I would like to move authorization for the Select Standing Committee on Forests and Lands to continue their examination of and to make recommendations with respect to exemptions under part 12 of the Forest Act and, without limiting the generality of the foregoing, to consider the items that were on their agenda. Rather than read the whole motion, if I have leave to move it, I'll move it. [See appendix.]

Leave granted.

HON. MR. RICHMOND: Mr. Speaker, the purpose of the motion is for the Select Standing Committee on Forests and Lands to continue the work it began last session on the Vancouver log market under part 12 of the Forest Act. I understand that prior to prorogation on April 5 the committee was considering a draft report, which the House will be receiving shortly.

MR. SPEAKER: The Chair has a copy of the motion if anyone wishes to see it, but I'd like to put the question.

Motion approved.

Orders of the Day

HON. MR. RICHMOND: Mr. Speaker, I call committee on Bill 11.

[ Page 9502 ]

SCHOOL AMENDMENT ACT, 1990
(continued)

The House in committee on Bill 11; Mr. Pelton in the chair.

[2:45]

On section 5 as amended.

MS. A. HAGEN: Mr. Chairman, for those people who may actually be referring to the bill and because there are a number of clauses within the bill that are related to the finance section of the School Act, I'll reference them too. We're looking at section 124 and, I think by extrapolation, section 125.

To clarify this debate for me procedurally and because we're dealing with section 5 as amended, I gather that we're going to go through all of section 5. We could presumably discuss any aspect of this from section 124 through to — well, I'm not sure how far. Please give me some direction on how we might discuss this, because normally we go through clause by clause and you ask us when we've finished our debate on the clause. It would be helpful for me and members on this side of the House to be clear on how wide-ranging our discussion might be under this section that we're dealing with.

MR. CHAIRMAN: I understand very clearly what you're saying. The answer is that we will entertain questions on any particular portion of the various divisions under part 8, but we will only take one vote to deal with section 5 as amended.

MS. A. HAGEN: That's very helpful, Mr. Chairman, because I know that there are a couple of members from this side who are not presently able to be in the chamber and who may want to range widely. However, for the convenience of the minister and his officials, I intend to proceed in an orderly way, shall we say, at this stage. I'll be following through the various sections under part 8. We may come back to them then with other speakers in the course of our discussions this afternoon.

I want to zero in again on section 124 and ask the minister some questions about the procedure. This legislation tells boards dates and procedures that will be part of the timetable for the preparation of their budgets. I have heard a number of queries about the availability of or lack of information in this statute as boards prepare their budgets based on block funding

In subsection 124(3), it states: "The minister shall announce by February 1 of a fiscal year the average per-student amount that is anticipated to be used to determine the provincial block of funds for the next fiscal year." But as I see it in this legislation, there is nothing to commit the minister to any other provision of information to boards as they prepare their budgets.

We all know that the procedure over the past two or three years at least has been for the minister, sometime around mid-February — this year, toward the end of February — to provide boards with specific-to-each-board information about the amount of funding that will be coming. In this case now, it will be coming out of the block.

We also know that under the old system there was information about tax rates and those elements of the budgeting process that enabled boards to budget in the fullness of knowledge. We also know that there is provision for the minister to provide, at some unspecified time, information about special grants. The minister has noted that he has now, under his ministry, a number of specific, very important grants for boards in their planning: the Royal Commission on Education funds, for example, computer funds and other special funds.

I would like to ask the minister, Mr. Chairman, to provide us with information about what he is required by this statute to do. I read it that he is required to provide boards with only the provincial average per-student amount and the total block. I want to know if there is any other requirement in this legislation and if not, why not. Will there be regulations that inform boards of what this minister will provide in the way of information and a timetable for that information, or are we relying on goodwill policy or past practice for us to know how the minister is going to give boards the very essential, concrete, specific-to-each-board information that assists them in developing their budgets for the current year?

HON. MR. BRUMMET: I note that the member has picked up that this legislation provides the dates and the procedures. I'm pleased that I don't have to explain that.

The act also says that by February 1, the block for the next year will be announced. This year the block and the increase.... We had to set the block as a starting point based on the 1989-90 year, and then we said we would increase.... Therefore that is the provincial block for 1990-91, and that was announced on January 31.

The boards were also told that as soon as possible, the fiscal framework would be run to provide them with the district allocation, and that fiscal framework is based on the information we have on the projected enrolments. Much of that work is done. We usually look for confirmation of the projected enrolments. We look for the information about average teachers' salaries, because that's one of the factors that kicks in to running the fiscal framework. Then, depending on how soon all that information is assembled — and thank goodness for computers — it can be done within about three weeks.

We said on January 31 that we anticipate we can put in all this information and run the district blocks by February 23, or by the third week in February. Thanks to the diligent work of my ministry and the gift of computers, it was possible to provide that information to boards.

Now there was other funding over and above, but that's the block. We will need less information in the future, because the total provincial block will be determined based on this year's block and increased by the economic adjustment factor. So we won't need

[ Page 9503 ]

as much information in the future, and the act implies that we're going to take a lot less information — just what we need to run the district block. But we don't need that kind of information to run the provincial block; they will just distribute it.

Then we know — and we had committed — that there would be extra funding for computers. We didn't know the exact amount. There would be funding for the royal commission implementation. We wouldn't know the amount until the budget comes out, and that, I think, is reasonable and fair. As quickly as that can be broken down, that is going out to school boards. But it does not affect their operation. They can carry on with their operating budgets.

If, as it turned out, we got $15 million for computers, as we had expected I think, so far, three years out of five, and we said we were on a five-year plan of $15 million a year, we have been delivering on our promise, We said that we were going to put out a lot more money for the royal commission implementation, and we have been delivering on our promise. Now suppose we had got only $10 million for computers; that would not affect the school district's operating budget. All it would mean is that they would buy fewer computers. Or if we got $20 million, they would buy more computers.

So boards have chosen to factor in.... "Well, we've got to go for computers. We've got to go for royal commission implementation money in their operating budgets." That's absolutely unnecessary, because the money that is in addition for that and other programs will be added on, and we will do whatever we can.

As for the capital program, we will put as much money as we can to upgrade schools or to add new schools. That money is over and above; it has nothing to do with the determination of the operation block. All it determines, subsequently, is how much we can do.

I hope the member can understand what the block is now. It's a block of money that will be increased each year, according to the economic adjustment factor. That will be distributed to school districts by way of the fiscal framework, as quickly as it can be run and done.

MS. A. HAGEN: Mr. Chairman, I'd appreciate if we didn't lecture each other on this. I'm really trying to get some very specific answers to questions. I think I do understand what the block is, and I do understand what the special funds are. I do understand that there are problems with boards in knowing what information they're going to get and when they're going to get it. That's the simple information I'm trying to get at.

I would gather from the minister's response that it will be policy to continue to provide boards with their grant allocation sometime in February. There's nothing in the legislation to require it; there's nothing in regulations to require it. But I would gather that's a policy, if you like, of the minister.

I would gather, too, from what he says, that boards will in fact continue to have only that information as they prepare their budgets and prepare for the possibility of going to referendum. Contrary to what the minister says, I believe that the lack of information on the total budget that boards will have does complicate their budgeting. It does make it more difficult.

Let me just make some obvious points. Certainly they are very practical points from the perspective of boards. If there's going to be $15 million in the pot for computers and it's going to be divided among school districts, that's one thing; if there's going to be $10 million, that's another thing. Boards may want to add to the resources that are available from the provincial government out of their block or by going to referendum. Until they know what is coming to them from those special funds, it's impossible for them to make those decisions.

On royal commission funding, the minister keeps talking about this as if it's some extraneous activity to the board's work. From my perspective — and certainly from the perspective I'm hearing from boards — planning for the changes which are encompassed under "Year 2000" and implementation of the royal commission report is an integral part of a board's budgeting. The minister himself has noted that there are funds in the block that may be used for royal commission implementation, so it's not all an add-on.

I think it's fair to note that boards find it difficult to budget in a coherent way for the year ahead when, number one, they don't have all of the information about the funds they're going to have available and, two, they don't know when they are going to get that information. I would note, for example, that the Vancouver board — which the minister has accused of holding some funds for computer purposes in an account instead of spending it — has noted that it takes time to plan for those kinds of expenditures. That kind of planning is what most boards want.

The Victoria board puts it very neatly and succinctly: "I don't care for this foot-dragging and lack of information. My duty lies with the kids of the district." That's a quote from trustee Peter Yorke, who chairs the Victoria board's finance committee, in the May 8 edition of the Times-Colonist.

The minister seems to feel that everything has to work according to his agenda. We know from this legislation that he can regulate a change in that agenda under a later section — at his whim or, more presumably, the Premier's, or at the time the House is called and so on. It's not a very efficient, effective and informative way for boards to be able to budget. I want to make that point on behalf of boards who are finding it difficult to meld all of these initiatives and these dollars together into good, effective short-term planning for the next fiscal year, and longer-term planning as well.

[3:00]

I want to just note again that there is nothing in this legislation, other than February 1, to note a global figure that is required by law. We have to rely on the minister's commitment to providing information. Even that minister is obviously constrained by these funds to the extent of the information that he

[ Page 9504 ]

can provide. That's not good enough for the kind of good planning that boards would like to be able to engage in. It is further complicated, of course — as all of this is — by that referendum issue and the very difficult and not-easy-to-make decision to go to referendum. At the best of times that decision is being made without really knowing what all of the factors are.

The minister can explain to his heart's content that these are separate, that they're not a part of this, that they're not a part of the block and so on. But a school, its staff and its work are an organic whole; they are not made up of little pockets of this, that and the other. This legislation, and the policies and procedures of the minister around those special funds, is not facilitating boards in being able to do the best job in maintaining the system and renewing and transforming it. That is, I think, a very real challenge that they face. It's not assisted by this minister and this legislation.

I want to move on to a couple of points made in clause 125 on the allocation of provincial blocks. I want to ask the minister what procedures he plans to have in place to deal with variations in the cost of delivering educational programs in those districts and an updating and review of those variations Yesterday we had some considerable discussion about what I deem to be fundamental inequities and problems that are built into the initial block funding The minister was not prepared to make a commitment to any clear process for reviewing that block. He has just reiterated that next year's block will be based on this year's block. That means that next year's block will compound any of the problems and inequities that may exist in this year's block. Perhaps there is in this clause some means by which the minister is enabled and in fact prepared to commit himself to some kind of review.

Again I want to note, Mr. Chairman, that our concern is that this block funding be established in a fundamentally sound way that enjoys the trust and confidence of trustees, the staff of school districts and parents. We haven't accomplished that yet. It's all very well to have the legislation in place, but unless those elements are addressed, we will be building a new funding system based on mistrust and concern on the part of the public that it's not going to work fairly throughout the province.

Can the minister again discuss how he will deal with variations in the cost — presumably again through the fiscal framework — and what review process is implicit or planned that will enable that block to be established and maintained in a way that is seen to be fair and equitable to all people?

I want to acknowledge that it will never be perfect There are always going to be questions and challenges. But we've got to start with a better base than what we started with in this particular year. Perhaps in this clause there are some opportunities for the minister to assure us that in the first year of implementation there will be some good, solid processes that will enhance confidence and knowledge of how the block has developed and how it is going to be maintained fairly for all districts.

HON. MR. BRUMMET: I know the member would really like to know when all this information will be available to school districts. Well, I guess we can't even anticipate what the opposition is going to do in the House — such as interim supply — to delay debate on anything. So it is pretty hard to consider all those factors and still come up with a definite date.

However, if the member would read the total bill, she would find that we require boards to submit a budget by a certain date. It logically follows that we can't expect them to submit a budget by that date unless they have the block allocation before that — in time to do that. They cannot make the decision whether to go to referendum if they don't know how much information is there for their operating budget for these other items. So it naturally follows back.

It starts from the tax notices that must be out by the end of June, so by some time in May the tax rates have to be out there. And for the tax rates to be established, we have to know what the total educational expenditures will be; and to know that, we've got to know all the school district budgets. For them to prepare all their budgets, they need to know what they're going to get. So it's in there, implicitly, if you track it and if you understand the funding system.

In answer to the last part of the member's question: "What is the basis in section 125...?" In very simplified form, having determined the block of money and converted that to a per-pupil amount...then the amount for the district will be based on the enrolment. The fiscal framework picks up all the variations in costs between school districts — and we mentioned there are hundreds of those variations. That is the basis for the distribution. In other words, that describes the fiscal framework.

Then there is the last part which the member made a point of in that section 125: "The minister may adjust the allocation of the provincial block to a board...if the basis for the calculation under subsection 1 changes." So that means that if the enrolment changes or if one of the variables changes, then I can adjust the block. And that will be done on the basis of fiscal framework. I don't know what is plainer than that.

MR. CLARK: I don't know anything about the details of these questions. I have never been a school trustee, and I find this difficult. I would like to ask some questions from a layman's point of view just for my own clarification. So I ask the minister's indulgence, if he knows them. I don't know the details of this.

It does seem, however — just to follow up on the member for New Westminster — that there is a lot of discretion in the bill. It says, for example: "...as determined by the minister." I wonder if the minister is concerned that that leaves the minister open every year to the kind of lobbying by various school boards that I gather he had to deal with this year.

[ Page 9505 ]

It seems to me that because of the discretion in the bill, the minister has the power to change the variables — to change the allocation — for every individual school district. So each board can make the case that its district is unique. I'm sure they all make that case. Each board can make the case that it's somehow being abused by the fiscal framework. And each board can go to the minister with justification and ask for the minister to exercise his discretion in its interests. I wonder whether that's correct, first of all, and whether that's a sound basis for a bill — or whether it might be easier and fairer to spell out the formula in more detail in the bill, so that discretion is fettered by common knowledge by all districts and everybody is operating on the same basis.

HON. MR. BRUMMET: I suppose I could answer it this way. Yes, there is discretion on the part of the minister. But there is also the responsibility to carry out the commitment of this government and this ministry to increase the block on the basis of the economic adjustment factor. If we don't, we're held accountable for that.

Each year in the past the budget was determined by what the government decided to do. We've put it on a more rational, predictable basis. If you know the economy has gone up 4 percent, you can expect a 4 percent increase next year; if it goes up by 10 percent, you can expect a 10 percent increase. So the discretion is there.

I think the question was that if we could pin down these amounts, then maybe there wouldn't be any lobbying, If I said today: "I'm pretty clairvoyant. I know the economy is going to increase by 4 percent next year, and I say that your enrolment is going to stay stable. So next year I assure you that you will get a 4 percent increase, based on the same enrolment...." Because my learned friend objects to ministerial discretion, next year it's: "Tough luck if your enrolment goes up 10 percent. I can't vary it, because they want to hold me to some figures I've committed to this year." As facetious as that sounds, it still says that the amount will be based on the number of pupils.

I don't know what that amount will be, because I don't know what the economy is going to do next year. I don't know what the total block increase will be, so I can't specify it any more clearly than that. But the public, the school boards and the opposition can hold us accountable to the commitments we have made to providing a more stable, more predictable and more reliable system of educational funding, rather than just making a political decision in any year. I think it's a great stride forward, if people would only recognize it.

MR. CLARK: I wonder if the minister could deal with what appears to be a problem, again from a layman's point of view. It sort of reminds me of the Soviet system of quotas. The factory is given a quota of 100 things to make. If they make 110 things, then next year their quota is 110. So presumably there's no incentive.

I guess what I'm getting at in a roundabout way is that efficient school systems, which have kept down their costs.... Let's take Delta; it has one of the lowest per-pupil costs. This framework seems to lock them in and penalize them for being more efficient, perhaps, than other districts. In other words, there is no rewarding of those that have been cost-effective; in fact, it's the reverse. If you've kept your budget low and you don't have as many programs as other districts, for example, then you're locked into that in perpetuity, because the framework doesn't take that into account. At least that seems to be the argument I hear from people in certain districts like Delta or Langley, where they have kept their costs lower than Vancouver. Now they're locked into a framework that keeps them lower in perpetuity.

First of all, I wonder whether that is valid or whether the minister agrees with that — that the unevenness of services between regions is in some way more difficult to change now because of this formula. If he doesn't agree with it, how could school districts make a case for that?

Obviously Vancouver has a more expensive system, for lots of very good reasons. Certainly they make more, but they also have services that other districts don't have. If other districts want to implement services such as Vancouver's, and they perhaps have different demographics, with different changes taking place.... It doesn't seem to be possible. It seems to be based on their historic pattern rather than on what may be happening demographically in the region today.

HON. MR. BRUMMET: I tried to cover that yesterday, but it seems that I have to repeat it as different members from the opposition side come into the House at different times.

Yes, it was based on their costs last year. Every district that is below the provincial average, and even some that are above the provincial average — notably Vancouver, which is well above the provincial average — said: "We were so conservative and efficient last year. Why are we being punished for that?"

The costs in Langley were lower; the amount in the Langley block is lower because their costs were lower. I have to assume that not every district had the same expenditures last year. If the member is saying that boards are now saying what they have said to me every year: "When you go to a percentage increase, does that mean that if we had found a way to spend more last year, we would get more money this year because we were efficient...?" Do you want me to destroy that efficiency by saying to those that had lower costs, because their costs were lower, that it should increase?

With the supplementary amount available to boards last year, they were responsible, they were this deficient.... Presumably they met all of the needs they saw were necessary in their district last year. Now they're saying: "Gee, if we had thought ahead, we could have spent more next year." That's a rather ludicrous statement, in that they're saying that the whole system should be based on how much we

[ Page 9506 ]

could possibly spend rather than on how much we need to spend.

Some of the districts that had lower costs for education — their turnout of kids; their production on provincial exams by any standard that we measure with or that we can measure — did well. In Vancouver, for instance, yes. Last year they apparently had 26 percent of their school population in ESL programs. The ESL students are funded at a higher level. In Langley I think it was 1.6 percent of their student population, so should we fund all of those students at the higher level when they don't exist? Should we fund the teachers in Surrey at the same average salary level when it went down last year by 1.5 percent, and is lower than Vancouver? No. We fund costs, and so it goes on.

[3:15]

The reward in the future is going to be that the school districts can carry forward their surpluses, so if they are efficient this year — and that's a new development, where they can carry forward their surpluses — it rewards them. It also prevents that silly practice of: "If we have a surplus, they'll take it away from us, so we've got to spend everything by March 31." So it's sensible, rational and also rewards boards for efficiencies.

If a board with the block funding system next year, for instance, can cut costs in some area by some responsible measure they take, that will benefit them to provide the extras the following year. I think it's a very good system, and people understand it. I would rather hope that once the referendum thing is over and some of these things are in place, we can get back to education.

It's there to do a great education system, with what's in their blocks, what's within the provincial block and with what is available in the other expenditures that are being announced now as quickly as the ministry can run them to each board — what they are going to get.

MR. CLARK: The carrying over of the surplus is clearly.... For the first time the incentive is there to save money, although one would probably be a bit careful about that, because if boards were running large surpluses, I'm not sure I would trust the government to continue funding the block at a certain level. But I still think it's a good idea that they can carry forward a surplus in this way.

I guess the point still stands, however, that you may be rewarding efficiency in the future, but you haven't rewarded in the fiscal framework with this current block funding. You haven't rewarded efficiency in the past. So I recognize the balance the minister has to play in terms of not wanting to destroy efficiency and give more money than is required, but at the same time there is an imbalance there that I think many boards feel. I'm not talking in this case about Vancouver; I'm talking about other boards.

What has happened as a result of that.... The other point I want to make is that school boards change. A school board may have been very conservative — and I don't mean that in a political sense — and have very low costs, and a new school board may want to introduce a program that exists in most other jurisdictions, yet they will have to go to referendum for a new program.

In other words, you set up a system of inequalities in this respect. You have a new board that gets elected; they want to bring in a program that exists in almost every other school district, but doesn't exist in theirs; they have to go to referendum. So we have this absurd situation where school districts may have to go to referendum for a program that exists in other jurisdictions inside the fiscal framework.

That seems to have been the case in some of the referendums we've seen before. I wonder if the minister would care to comment on what appears to be varying quality of education, or varying programs of education — we assume that relates somehow to quality — between districts. How does the framework try to deal with that, given the situation we had where some districts were going to referendum for programs which already existed in other districts and were being funded under the framework?

HON. MR. BRUMMET: The fiscal framework in the past was not based on a board's attitude towards efficiency or nonefficiency. Surely not everybody, above the provincial average was inefficient. They had higher costs, because in some districts in a small secondary school the pupil-teacher ratio to give a quality education has to be considerably different than in a large school. That's all accounted. In some schools remote factors are calculated in, and so on.

It's hard for me to accept that those who were at the average were average, those who were above the average were inefficient and those who were below the average were efficient. That's the point that people are trying to make now. The fiscal framework from previous years was based on their costs, not on their attitudes.

Many of the boards are now claiming efficiency as the reason their costs were below the provincial average. I don't know; I guess it could be a factor, but by and large it was because of the variables between the districts — the difference in ESL between Langley and Vancouver. That cost differential was not based on the board's attitude. It was based on the fact that there were a whole bunch of other services: special services, more special needs kids in Vancouver than in Langley, native education programs, physically handicapped — all of those are funded at different levels. That's what made the difference.

Now boards are claiming: "We were below the provincial average." I've had this from some of the boards in the lower mainland: "Because you have come up with a new system.... Our costs might have been lower than the others last year, but now we think that you've changed the system. We should all be at the provincial average or above." You think that one through for a minute, and you'll find out that it doesn't make any sense to say they didn't have a program that another district has.

[ Page 9507 ]

Well, if they didn't have ESL students last year, they didn't need an ESL program. If they have ESL students this year, they get funded in the fiscal framework distribution of the block for those ESL students. All they have to do is show them, and we rerun it at the end of September based on actual enrolments.

If they had no handicapped students integrated into the system last year, and this year they show in their projections or in September the actual numbers for handicapped students, we rerun the fiscal framework and provide for those at the appropriate funding level. So those programs are built in.

I know that boards — politically or for some other reasons — have said.... Your leader, for heaven's sake, went out there and said that under this new system, disabled kids will be precluded from getting an education. Yet we have put in money this year to integrate disabled kids into the school system. We have a protocol agreement between the other ministries to enhance the services available to those students.

Your leader goes out there and plays politics with the kids and accuses me of doing it. I'm not playing politics with the kids — no way. We're funding where the needs are; the disabled students will get that. But he can get a good emotional reaction.

"This government is taking away the opportunities for disabled students in the system." That has to be nothing but crass political garbage, because it is not true. We are increasing the funding for those disabled students. But it's frightening to them, isn't it? That's why I call it crass politics. It's not correct; it's untrue. Yet that's the kind of game we play.

If there are less students in one program and more students in another program, without even consulting us the board can shift their priorities. They can move things around. They can put a librarian or one more teacher in a school. We don't question that. The amount of money is there based on the enrolment and all of the other variables. So to say that districts who don't have a program now can't put in a program unless they go to referendum is patently false. All they have to do is show us that the need is there, and the fiscal framework picks up that recalculation. They can set their own priorities, and they can do those sorts of things. So I cannot accept some of these invalid criticisms that are implicitly stated by members of the opposition who accuse us of playing politics with the system.

MS. CULL: I have a number of questions, and I'm just going to pick up on the minister's last comments. If there are two school districts, and prior to this year both of them had special-needs children requiring integration.... One district had an integration program — perhaps they had gone through their supplementary budget last year and increased the residential taxes to pay for such a program — and the other district had not.

My question is: does the new funding formula address the fact that the second district had the need but was not providing for it, for whatever reason that may be? Is that reflected in the uplift? Correct me if I'm wrong, but I thought I heard you say that if a district wasn't providing a program last year, there wasn't the need for that program to be provided.

Interjection.

MS. CULL: Well, okay, then answer that question for me, because the answer to that is important for my next set of questions.

In a district that was — for whatever reasons — unable to meet a need prior to the new funding formula, I want to know if that need is recognized in the new funding formula before they get the other uplift that the other school districts would have gotten in any case, because they were providing it out of supplemental funds.

HON. MR. BRUMMET: Perhaps I can respond this way. A handicapped student generates $6,000 in the block. If that handicapped student exists — this year or next year — it will generate $6,000 in the block as compared to the $3,000 that a regular student would generate in the elementary system. It varies between elementary and secondary. So the funding will be there if the students are there.

The policy of this ministry has been — by ministerial order and by implication in the new School Act — that the policy is integration. So if you have 20 handicapped students funded at double the level of regular students, the money is there, and we expect any district to integrate them to the extent possible.

MS. CULL: So last year, in the Greater Victoria School District, the supplemental budget included $600,000 to integrate special-needs students. That was a partial move towards integration, which, in the opinion of the board and the parents, took them about a third of the way down the line. Is that funding represented in the block this year? Is it correct that that $600,000 is included in the Greater Victoria School District block funding so that that level of funding, at least to the partial integration, is still reflected in their block funding?

HON. MR. BRUMMET: I would think yes, because I believe Victoria was about at the provincial average of supplementary spending over the fiscal framework, so there wouldn't have been much of a change there. The point remains that if the Victoria school district had X number of students that qualified for handicapped-level funding, they got that money. They may have put those particular dollars somewhere else and convinced their taxpayers that the only way they could teach those students was by raising an extra $600,000.

[3:30]

I say to you that the funding was there for those students for the Victoria school board last year. You chose, I guess, to go to your taxpayers and say: "We're going to have to get another $600,000." As I pointed out in the House yesterday, the Victoria school district had budgeted a 10.5 percent increase

[ Page 9508 ]

for taxpayers. When we changed the formula from a 55 percent base to a 57 percent base.... As a former school board chairman, you should recognize that you've got over $2 million more than you had expected from the provincial grants. You did not reduce your budget. You did not go to the taxpayers for $2 million less and say, "We had already determined our total budget." Oh no, you expanded your expenditures by the $2 million, and left the tax increase at 10.5 percent. So I don't know how you manipulated or handled the $600,000. I'm saying that If the kids were there, the funding was there. How you arranged the money and how you said to your taxpayers that you needed that money....

My education critic here said it was a matter of mistrust. I would say that it's that side of the House that is disregarding the figures and doing everything it can to generate mistrust; this side of the House is going by a formula that we try to fine-tune every year, on the advice of people from the field who are in the field. We fund objectively on the basis of that formula, disregarding the politics of the board.

MS. CULL: The minister is assuming, of course, that the funds that were provided by the fiscal framework were in fact adequate for integration. They certainly were not adequate for integration last year in the Greater Victoria School District.

The other example I might give to illustrate this is the funding that was available for gifted students. We know that that comes on a formula basis, that a certain percentage of students in a district are entitled to funding for gifted students. The Greater Victoria School District has in excess of the percentage that was allocated. So the money that was available from the ministry to provide programs for gifted students could either be spread more thinly or the board had the alternative of going to the taxpayers and asking for increased funding. I think that's at the root of the problem here.

I just want to return to the section we were discussing and talk about what disturbs me, which is the question that the second member for Vancouver East (Mr. Clark) asked. I don't believe the minister answered it. He asked about the variation as determined by the minister, and the minister replied about the total adjustment of the block, the economic indicators. I fully accept the fact that costs are different between districts, and that there are many reasons for them to be different, but how I read section 125 is that the minister can determine the variation in the cost of delivering education programs in that district. It reads: "The minister shall allocate the provincial block based on (b) variations in the cost of delivering educational programs in those districts as determined by the minister." That's the part that disturbs me.

I would like to know what the basis is for determining the variations in costs. What kind of process occurs? What options are there for boards to debate or appeal? Is there some kind of mediation process available to boards? Or after going through a dispute as to whether in fact a cost is X or X plus one in a particular district, does the minister then give his decree? Or what actually happens in negotiating this?

HON. MR. BRUMMET: Mr. Chairman, I had already answered the questions. The member mentions that the variation, as determined by the minister, is the authority for applying the fiscal framework. The fiscal framework picks up those variations if the variations change. Somehow or other the member is reading into it that I can just willy-nilly decide that. And I suppose, technically, I could say that I don't like the Greater Victoria School Board and that I'm going to cut their funding in half. Do you really think that is a realistic type of approach? We have an objective fiscal framework that is adjusted by responsible people according to a formula. To try and attribute that....

The school district and your school board chairman can determine some of the policy decisions with your board, so should you say that there is no room for any adjustments on the policy or the amount you spend per pupil, by any discretion of the board? The adjustment or change in the calculation can only be done, according to the act, if the factors or variables change or the enrolment changes. That's what it says right there. I don't know how many times I have to answer that.

MS. CULL: We appear to be asked to have trust and faith and not to worry about what the words in the act say. I think the act is very clear. There is immense discretion by the minister to determine the variation in the cost of educational programs, and I see no ability for boards to dispute that with the minister. If the answer is that it would be unreasonable for the minister to be arbitrary.... I agree that it would be unreasonable, but unfortunately the history of public education financing In this province doesn't mean that it's unlikely.

HON. MR. BRUMMET: I don't think I'm going to let that go. It's the usual slanging that they do: "Well, the history of the funding isn't that great and...."

MR. CLARK: The truth hurts.

HON. MR. BRUMMET: It does not, because it's not the truth. If it were the truth, I could deal with it; but it's not the truth that education funding has been based on those objective terms.

I guess that member is asking that once you apply the fiscal framework, then will you stop and negotiate with every board whether it is right for their district. We would never get the budgets completed if we opened that, because practically every board will say: "Well, we believe in a provincial average as long as we're at the average or above." That's the thing. Do we negotiate with every board, or do we use the fiscal framework?

If we use the fiscal framework, the boards, through their representation on the fiscal framework advisory committee that looks at it all year, have input to say that the fiscal framework is inadequate

[ Page 9509 ]

in this section, should be topped up here or shifted here. Those recommendations have been taken every year, and many of them have been incorporated in the fine-tuning of the fiscal framework. The boards have that input.

If the member is asking whether there is an avenue for every board to appeal the fiscal framework as soon as it's announced, I guess I have to answer no, because we can't negotiate. I have even had some board chairmen come to me with the board's position, and then another trustee come to me with another position, and both of them try to negotiate with me. Imagine a system based on that type of system. It has to be something rational, and it is.

MS. A. HAGEN: We have probably discussed this issue pretty thoroughly. We've made the point that the bill is pretty bare-bones. We know what the procedure is with the ministry. We know that there is a good deal of discretion there. I think there's still some considerable nervousness out there in that because there aren't some more concrete legislated stipulations, there is a lot of discretion at the hands of the minister. The minister has, without question, over the last number of years made information more available and worked diligently, I believe, on a number of these issues.

There is no question, however — and it's demonstrated by the fact that all these supplementary amounts are rolled into the block — that the fiscal framework was not adequate and that boards had to go to their own taxpayers to find the funds needed to run the system.

I want to come back for just a moment to the matter of grants. There is some reference to special purpose grants in section 131. The minister persists in saying that somehow the opposition is responsible for the fact that school boards don't know about their computer grants, royal commission education grants and so on. In the same breath, he keeps saying that we're trying to run them through the computer as fast as possible.

Let's just note that there are special-purpose grants. They are presumably not defined in their global amounts until the time of the budget, the date for its coming forward being determined entirely by this government. Once the budget is down, none of the allocation of those grants has one whit — if I could be so blunt — to do with what's happening in this House; it has to do with the ministry's timetable in getting that information out.

I just want to make the point again, Mr. Minister, that as far as boards are concerned, they deal with global budgets. As long as we're going to have special-purpose grants along with blocks, then if the ministry doesn't get that information to those boards in some reasonably expeditious way — and the end or middle of May is not a very expeditious time to be still waiting for critical information on quite significant dollar amounts that are needed, which the boards need to know in order to do their planning — then we are going to have a continued hue and cry about boards trying to make comprehensive decisions, unfortunately including, if this legislation goes through, a decision about whether to go to referendum based on incomplete information. I have not heard from the minister anything that really gives us an assurance that next year things might be expedited considerably.

Perhaps we could give some acknowledgement that with changes this year and a lot of work that's had to be done within the internal workings of the ministry, that has delayed the process. But the budget came down on April 19, and boards still don't know when they're going to get information on the Royal Commission on Education funds. The minister announced on April 28 the actual disposition of those around a whole range of elements. Boards still don't know.

Can the minister give us some indication on these special grants, which I'm not very happy about in terms of their being in some special area where it takes time for boards to get the information? Can the minister give us some indication of when, perhaps in another year, that information might be available to boards? Supposing we have a traditional year and supposing we get our budget around March 15 or 19, is it possible that the minister, being somewhat — what's the word? — prescient, might have some idea what might be in that budget, some knowledge that would allow him to do some work before the budget comes down on some hypothetical figures that could get fine-tuned, so that boards might have that information by the end of March instead of by the end of May, which is only a month before the end of school year, and only a couple of months before we've got to figure out how boards are going to make good, efficient, effective educational use of those very important dollars?

HON. MR. BRUMMET: With respect to the comments about the nervousness and mistrust out there, I guess when you have an opposition that devotes almost 100 percent of its time to fostering the nervousness and mistrust, and with their friends out there pursuing that, then it's not surprising that some of it exists.

In terms of trust, I believe that I and this ministry have delivered on every promise we have made for the last three years.

I agree with the member that the discussion in this House probably has not one whit to do with the reality of what's going on in the budgeting process, but I can't help that, because the members opposite are playing politics. That member, who has been in this House now for a little while, says to me: "Would you pre-empt the budget by announcing the amounts, because you might have some idea what's in the budget?" Yes, we make our submissions in the budget, but in all fairness — and that member should know — we hope that our submissions will be accepted as made. I did say that there would be more money, that I didn't see how we could carry on with the same amount of money for the royal commission implementation. I expected a considerably greater amount this year, because that was our commitment.

[ Page 9510 ]

As it turned out, the amount in the budget was even greater than I expected, and then the members opposite tell me that I lost the arguments in cabinet. I don't know; where do you go?

We announced when the budget came down.... Admittedly it was much later than usual this year, and it was complicated by a change in the system and other factors. We have done the best we can to get the information out as quickly as possible. We said at the end of January that we expect we will carry on the computer program we had last year, so any district could expect their proportionate share. They had received it for two years, and we couldn't guarantee it, because we didn't know the amount. We had said there would be more money in the royal commission implementation, and it would cover the extra expenses as required, so you don't need to calculate that into your block. You get more dual-entry students next January and the money will be there for the staffing, the facilities and the supplies. We said that, and they said: "We have to go to referendum for money for dual entry for next January." Why? Because the opposition said, "Don't trust them, " when we had made that commitment.

[3:45]

I'm supposed to put out some hypothetical figures about....

MR. CLARK: No, no.

HON. MR. BRUMMET: That's what that member was asking me: "Would the minister put out some hypothetical figures about what might be for the extra grants and the special grants?"

Mr. Chairman, when the budget came out this year, it was announced there would be X number of dollars for computer, X number of dollars for royal commission, and X number of dollars for these other funds. It was there. It was in our press releases on April 19 and 20, and we said the money was there. I think it's reasonable for school districts to expect that they would, as in the past, get their proportionate share, because I have made into a formula the amounts that people get for computers and many of these other programs. I have made that objective in all the time that I've been in here. Why would they expect anything different this year, except because the opposition says: "He's wrong. You can't trust the Minister of Education"? I don't accept that. I don't make promises lightly, and I don't make promises that I can't keep. So I'm not going to put out hypothetical figures.

MS. A. HAGEN: Mr. Chairman, I just want to clarify the question. Boards are looking for that information in concrete terms as soon as possible Although the budget has been out since April 19, perhaps the minister, who hasn't been able to provide that information yet, can give us some indication of when it's coming, especially if he has a formula and has it all worked out. Perhaps he can tell us whether, if we have a normal legislative session, with the budget coming down around the second or third week of March and with some improvements in how he manages the information, we can expect that information to be earlier next year.

Let's face it, boards are creatures that like to work with good solid figures; they want to know how much money is going to be there. They don't have any idea, and they're trying to plan for next year. I think it's fair for the minister to give us some information rather than to twist my question. My question was only about what the minister plans to do about getting the information to boards as quickly as possible. When might it come this year, and when might boards expect to have it in the years coming, since he has a ten-year program for the royal commission?

HON. MR. BRUMMET: I think I've answered that question several times. We try to get the specific information out as quickly as possible. I've been in this Legislature 11 years, and I don't recall a normal legislative session. So I don't know what the norm is, quite frankly. I guess the one thing I can recall is that whatever we do, and no matter how much we've increased it, it's not enough; we don't do it right. The opposition keeps sowing mistrust if they possibly can, because it's to their political advantage to do so. I have had some members on the opposite side say: "I'm happy with what you're doing, but please don't expect me to say that publicly, because politics interfere with that." But there's certainly no hesitation on the criticism.

I can't give you a date as to when the budget will come down next year; therefore I can't tell you on what date I'll make the information available next year. I have said clearly that we like to get it out as early and as quickly as possible. This year we had a slowdown in getting out the block allocation to districts because some districts dragged their feet on getting the information to us; that happens periodically. We have to have tax rates set by next week. I don't know the deadline. School boards were supposed to finalize their budgets on May 8, but we haven't developed the capacity to go and grab them by the throat and drag it in if they don't deliver it here by the morning of May 9. We can't even rely on Canada Post, but we do have fax systems and that sort of thing. So we get the information as quickly as we can, and the ministry puts it together.

The short answer is that we will get the information out to them as quickly as we can, if for no other reason than to get the opposition off my back.

MR. CLARK: That seemed to be a rather aggressive response for a fairly gentle question. The minister said that there are members on this side of the House who secretly agree with him on some aspects of the bill but won't say so. I'll bet you, Mr. Chairman, that there are sections of this bill — like the referendum section — that the minister doesn't agree with, but he doesn't say that publicly.

I'll just ask one question, and then I want to move to a different topic within this section. I was a bit confused by some of the answers. I want to take the

[ Page 9511 ]

example of the school lunch program — the very modest program that exists in Vancouver. That, I gather, is included in the block funding by the government, and I applaud them for that. I think that's good news and a positive step. What I'm asking is: say another school board thought that there was a need for a lunch program — say Prince George or somewhere. How can they make the case to get core funding for that program? Or do they have to go to a referendum? I guess that's the essence of the earlier questions I was asking.

The minister said that with respect to ESL, they make the case by saying that there are ESL students, and they get funding for it. I accept the minister's remarks in that regard. The minister said that Vancouver has more disabled students, and they get more money; if other districts get more disabled students, they will get more money. But what about programs like the lunch program, which is now funded by the provincial government in their block formula? The minister is making faces, so maybe I'm wrong. But as I understand it, the Vancouver School Board is funding the school lunch program on the basis of the block funding provided by the ministry; I assume that's the case. Why might other boards have to go to referendums for something like that which is funded by the block funding formula in Vancouver?

HON. MR. BRUMMET: I think the member still has great difficulty understanding the block funding system and the fiscal framework as a means of distributing. It's based on the enrolment plus a whole bunch of variables. Any district can decide whether it puts the money into this thing or into another. In the case of Vancouver, we're talking about a $290 million budget, in which they find $400,000 for lunch programs. In the case of Surrey, they went to referendum for $150,000 for a lunch program. I have to consider that more politics than fact, because with a $187 million budget, all that you have to do is decide that lunches are important. Last year, they said: "This year we've got to go to referendum for a lunch program, and we just don't have a nickel in that $187 million. It's not a priority unless you, the province, give us another $150,000, or unless the taxpayers approve it." Last year they ended up the year with about a $3 million surplus. But it wasn't a priority; $150,000 wasn't a priority last year. But this year, as an emotional referendum item, it becomes a priority. I guess, emotionally, these things work.

Since some referendums have been defeated, people have now said: "We have got to cut staff." In their referendum they were not talking about reducing class size nor about adding staff; they were talking about these wonderful programs that they were going to do — they were going to no longer spray the grounds in Vancouver. Now, all of a sudden.... Well, they passed their referendum. But in a couple of the districts I guess it's natural, when people are out to fight a battle on emotional tearjerker grounds, that out of $187 million — Surrey says: "We lost the referendum" — you can't find $150,000 to feed the kids. One-twelfth of 1 percent of salary increase in that district would be twice as much as they need for that program. The teachers and the trustees — sometimes they're the same — tell me that it's a priority, but only if we give them $3,150,000 surplus, instead of just $3 million.

[Mr. De Jong in the chair.]

Now you stop and think about that one, and wonder why.... Any school district in this province, for the cost of a lunch program, can do it within the block funding, within the multitudes of millions of dollars, the $3 billion that we put out there. They can do it. But they're saying the only way to have a lunch program is to increase this $3 billion. It went up 15 percent this year. They say: "The only way we can do lunch programs is if you make the increase 16 percent, and then we'll tell the taxpayers that it's your fault."

MR. CLARK: Would the minister agree with me...?

HON. MR. BRUMMET: Seldom.

MR. CLARK: Seldom, I know.

I understand the minister's point. There's a certain validity to it, except that I.... Would he agree with me that because the school lunch program was funded in Vancouver last year, and because those costs form part of the new block funding, it was easier for Vancouver to continue funding the lunch program than it would be in Surrey, that didn't have a school lunch program and therefore faced a new spending initiative not covered by the block funding formula?

HON. MR. BRUMMET: No, Mr. Chairman, I can't agree with him on that. There were different items funded in different districts. If Vancouver, for instance, chooses this year to change their pupil-teacher ratio, then they wouldn't have any money left for a school lunch program. So whether it's easier or not is a decision out of their approximately $290 million budget.

MS. EDWARDS: I'd like to talk about School District 1. As you may recall, they had some difficulty trying to put their budget together, trying to decide whether they'd go to a referendum, based on the fact that they don't know what their target grants are going to be. They don't know what it's going to be. And they made a very clear statement to you, as minister, by sending you their budget with a supplementary amendment saying that if their target grants are not adequate, they will have to send you a supplementary budget. You obviously have all the right on your side on this, and you could do what you like if they chose to do that — which is perhaps not the accepted way to do things. But what School District 1 has done, Mr. Minister, is make a very clear statement that they need to know what their funding is, or they can hardly be expected, in a short amount

[ Page 9512 ]

of time, to make decisions about whether they're to go to referendum. That was a very clear statement. It said exactly what they wanted to say to you.

So my question to you is.... And I push again, because I haven't heard the answer yet that I think is a reasonable answer. The ministry lays out dates by which it needs certain information from school boards, but school boards don't have any knowledge of when they are going to get information back from the minister so that they can make informed decisions. Will the minister consider that they could know what their grants are before such time as they have to go back to make you a budget?

HON. MR. BRUMMET: By the third week in February, as promised — thanks to the efficiency of our ministry — they were told what their operating block would be, so they knew how much money was available. They had already been told: "We don't know the exact amount, but you will get computer funding. We don't know the amount, but you will get the necessary funds for all of the requirements of the royal commission implementation."

[4:00]

They knew how much money was there, and for any board to say to me: "We'll send in the budget, and if it turns out that what you give us is adequate, then we promise we won't go to a referendum...." How do I define adequate? Is it a matter of attitude, numbers, costs? We talked a lot about the fiscal framework being based on costs. A lot of people have told me: "That's not adequate. It should be based on whatever expenditures we feel like generating." You can't operate a system on that type of agreement.

In School District 1 they were told that on the basis of the fiscal framework, they got a 5.8 percent increase in the block. We allowed 2.4 percent for enrolment increases; that's broken down. They were given that information in February — what their block would be and what they needed to operate They were told that the capital and all of the other amounts would be determined — that we would do the best we could with the capital, depending on the amount; and that we would not ask them to implement dual entry if we weren't prepared to fund it from royal commission funding.

They had the information early.

MS. EDWARDS: As I understand it, they didn't know what their block funding was. But that was not the point. The point was that above and beyond their block funding, they didn't know what they were going to get out of the commission funds, as they call them. They labelled them "target grants"; in the bill they are called "special grants."

This board is made up of responsible individuals, not all of whom agree very well all of the time on their moves. But they agreed quite well on this move, which was a very clear statement to you as minister to please let them know before they have to send you a budget what information they have to work with.

I find myself being amazed that you say: "Well, we told them they'll get enough for...." "Enough for" does not have definition, Mr. Minister. What they think "enough for' is, as you've said a number of times, is not exactly the same as what you think enough for" is. I think that some promise would be in order if you expect boards to meet certain deadlines, and that you would agree in return to respond by certain dates on the amount of funding a board has to work with to do its budget.

HON. MR. BRUMMET: I don't know how often I can repeat this. The information necessary for the board to move to the next step in its budget is all provided in adequate time, albeit in somewhat of a tighter time-frame this year than in other years. It is specified when the information has to be in and when the information has to be out.

I suppose they said: "Well, we don't know how much we're getting for computers." We have told them that we expect that it will be the same amount, so they could guesstimate. But If they got $20,000 for computers at $2,000 each, then my arithmetic tells me that they know they could buy ten computers above the budget. If they only got $12,000, then they would buy six computers. Less computers, more computers; it has nothing to do with their operating budget.

Some boards even said: "Before we can make a decision on whether or not to go to a referendum, we've got to know what the tax is going to be." In other words, translated: "What is the tax room?" We had announced at the end of January that there would be tax relief, so they asked: "How much?" I came back with the only answer I could give them: "Your budget should be based on your needs and your costs, not on the amount of tax room we create." They didn't need to know, because we had said: "From now on, we'll take over the responsibility to see.... You will get the money that's necessary for your block; it will be provided to you."

MS. EDWARDS: I'm sure the Fernie School District didn't know that your homespun advice was so readily available: "If you don't get it, you won't have it." I don't think that was the kind of advice they wanted to have. They wanted to know what they were going to get, not simply: "If we don't get ten extras, we don't get ten extras. So what?" That's not the kind of budgeting they want to do.

However, Mr. Minister, your comments make me even more nervous about section 133 — "Conditions of grant payment" — in which the minister has extremely broad powers to make decisions that were previously made by boards. I would like the minister to elaborate a bit on the circumstances in which he sees that he might make a decision which would be counter to a decision by a board about whether or not the duties of secretary-treasurer are being discharged satisfactorily. If the board hasn't conducted its affairs in accordance with the act, if the school buildings haven't been established or maintained to your satisfaction, and if the board perhaps hasn't sent all its paperwork in on time.... You as minister will get there as quickly as possible, but there is a very clear

[ Page 9513 ]

requirement in this section that boards have to send their information in or they will lose their grants.

Of course the final one in subsection (1) says, "the operating expenses of the board, if they've been reduced during a strike or lockout," and it's the minister who benefits from that particular circumstance.

First of all, I wonder if the minister could elaborate on what he would foresee happening. What are the circumstances that you foresee where you're going to go and tell the board that their secretary-treasurer is not behaving adequately or that a school building has not been maintained adequately?

HON. MR. BRUMMET: Mr. Chairman, how desperately they grope to criticize, and what little understanding they have of the system.

The duties of a secretary-treasurer are spelled out in the School Act. The duties of the board are to see that the secretary-treasurer carries out the duties as spelled out in the School Act. It's very clear. I think the act and the regulations are quite specific. If a board defies or ignores the act, or shuts down schools for a week contrary to the act or regulations, the minister can withhold a grant. In the past we had the right to withhold a grant, and that was about it. This is better: we can withhold or reduce a grant now, under the same section.

We have the last section, which the member sees as particularly threatening. Maybe it's not understanding it. If the teachers don't show up for work because they're on strike for two weeks, they don't get paid. Therefore the board does not have that expenditure. Though some boards have said: "You should leave us the money anyway, and we'll find some other way to spend it." We say: "No. If you are saving $200,000 or $2 million that you are not spending on teachers' wages because the teachers aren't getting paid, then we'll reduce your grant by that much." I think it's fairly clear.

MS. EDWARDS: Thank you, Mr. Minister. On the final point, of course, it's one that's not new; the minister has on other occasions been criticized for deciding that it's the minister who should take advantage of any local bargaining or activities that take place. That has been resisted strongly right down the line, and the minister is at it again.

The minister has for some reason failed to answer why he thinks he would be in a better position to decide whether a building has been maintained satisfactorily than would the local board. Perhaps the minister could answer that.

HON. MR. BRUMMET: You see again how desperately that member is searching for problems. We are not interested in shutting down a school or withholding grants from school boards; we would like them to keep the school running. But if all the windows are broken in the school and they don't repair them, we have to say: "Look, that's not correct." Before we withhold the grant, our facilities manager would go to the board and say: "Look, this school is not being kept up to standard. This school is not built, hasn't been established."

If they say to us that they have a one-room school out in the country and have moved a portable in, and we go out and find that they didn't move a portable in, would you say we should give them the money anyway? Let's be reasonable. There is a degree of reasonableness and common practice that comes in here.

To the opposition, if it doesn't spell out in 17 pages what we are going to base inadequate maintenance of a school on, that leaves the discretion to the minister. Do you think I go and check all these schools? If the parents complain, we might send somebody to check. If we find out, we always try to rectify the problem before we ever move to withholding grants. But if boards refuse to do anything about a school — not place the school where they say they're going to place it - and we've provided the funds, should we not be able to withhold those funds? In other words, let's use a little bit of common sense — even in your efforts to criticize every possible section of this legislation.

MS. EDWARDS: Speaking of being desperate and searching for desperate answers, I think the minister has resorted to desperation. What do you mean, a school with all the windows broken and the school board sitting around twiddling their thumbs saying: "Oh, oh"? The minister has said it's all laid out in the legislation, and now it's the board's job is to see that the secretary-treasurer does it. It's the minister's job then, I guess, to see that the board sees that the secretary-treasurer does it — da da da. So who is laying all the things out in detail and using what is not common sense — which is not even sense at all? Why is this laid out?

If the school board was taking care of it, it would be their responsibility, and that would be the way it is. Instead, the minister has to lay it out, and the ministerial responsibility is now there. Do we think that you go and look at every school in the province? No, we do not, Mr. Minister; we think that the school boards do, and that's why the responsibility should be left with the school boards.

It's the most insidious section. The attitude that underlies this whole section is the most amazing kind of centralization of power. It's unnecessary; it lacks common sense.

It's somewhat desperate for the minister to suggest that he's going to have to run around and deal with school boards that leave schools with all their windows out — or maybe the floors aren't waxed, or who knows what. If that's the level of poor maintenance that has to occur before the minister comes in, then the minister should apologize for this kind of proposed legislation.

HON. MR. BRUMMET: Mr. Chairman, I did try to point out that these clauses about the duties of the secretary-treasurer, which the member, in her eagerness and desperation to criticize, jumped on, are all spelled out in the School Act, not in here. These are

[ Page 9514 ]

not new clauses. The only real change from what was in the act is that this one combines: it says we may withhold or reduce a grant. The rest of it is carried forward from the act. And that member, because I tried to point out a ridiculous example in answer to her question about how a minister will determine whether there's proper maintenance in a school building.... I was trying to be as facetious as that member was being ridiculous in her desperation to criticize. Then she says: "That's the minister's standard for schools." I guess I'm not going to give you any more examples, because obviously you don't understand facetiousness.

[4:15]

MS. A. HAGEN: I have just one specific question that I'd like to ask the minister before we begin some discussion of the referendum process. Boards are budgeting now in a different way. I think the new budget process is probably one that will be welcomed, In that there is only one budget.

In the preparation of that annual budget, boards are going to be essentially making a decision about the referendum procedure. I would presume, Mr. Minister, that boards can continue to do provisional budgets, and work on those budgets until the time comes for them to make a decision about referenda.

In other words, the minister has to have some information, but boards will have a process that they decide is going to serve their needs. They might want to do a provisional budget like the one a municipal council does: go out and take that budget around to the school district; have people examine what their priorities and goals are for the year, what resources they have; find out what the community is interested in seeing develop, what innovative programs the board might be considering, what changes there are to expand and enhance the services available to kids.

I would presume that there is nothing at all in this preparation proposal that has anything to do with whatever process of consultation a board wants to follow, as long as they get to a point where they make some decision about whether they're going to go to referendum or not.

I'd ask the minister to comment about that in a moment because I think we sometimes get locked into a procedure, especially when we've been so used to having a provisional budget which we couldn't increase at the board level, but which we might decrease when we made some final determinations after those consultations. That's the first question.

The second one is a specific one, and I'm looking here at section 127(2). I've been asked what local revenues are, whether there are any changes in local revenues. For the minister, section 127 is on the preparation of the budget, and there's a reference to local revenues. I'm not quite sure that it's clear, because there is no definition of "local revenues." For example, I think local revenues have in the past included taxes in lieu of regular taxes. Taxes may be paid by the federal government, or even by the provincial government. Local revenues may be funds that come from other sources — perhaps from the federal government for French programs, for example. Since there is no definition and since local revenues become a part of what the board has to work with, along with the block funding that comes through the decisions of the ministry, could you define "local revenues" and what might be included in that term?

Could you also comment about board budgeting processes, and a kind of provisional discussion budget that boards may work with, that may be different from what they send over to the ministry for the ministry's information?

HON. MR. BRUMMET: Mr. Chairman, quite definitely — and it's what Bill 11 tries to explain — there is not much sense in having the old procedure of a provisional budget which you can only reduce but you can't increase, because now the block funding eliminates all of that process.

The ministry does need a bit of information in order to calculate the district allocation of the block. The provincial block, as we say, will be determined by those objective criteria of the economic indicators, but then in the distribution the debt services between districts will vary, and so the ministry needs that information to do that. There would be a minimum amount of information required on or before March 15 of each year.

It does not prevent the board from doing their budgeting all the time from September. In other words, they can be working at it by, we expect.... We have to announce the provincial block by February 1, and I would think that within two or three weeks the districts will know what their block allocation is, and that's when they have to start pulling together what's available in order to bring a budget together.

In the definition section of the bill there was a definition of local revenue, probably fairly vague, which said it does not include money from the block or the referendum. There are a variety of local revenues under the fiscal framework which boards are familiar with — the sections under the fiscal framework: federal French grants, other Ministry of Education grants, revenue from provincial ministries, summer school fees, continuing education fees, instructional cafeteria revenue, sale of supplies, miscellaneous fees and revenues including offshore student fees, community use of facilities, investment income, rentals of space equipment including short-term leases, and so on. In other words, by simple definition, it's what money they raise locally that isn't provided.

Remember, all of the money that the block generates will be provided to them from the provincial government in their monthly payments. Their referendum money will come from the municipalities to them. So those two amounts are not in, but many of the other amounts are classed as local revenue. By definition, you can't possibly define anything else. I don't know — if a school board got a benefactor that gave them $100,000 for something, I think we would classify that under local revenue; that's the sort of thing. You can't name every possible source, but it's

[ Page 9515 ]

that money that doesn't come from the block and that doesn't come from the referendum that the school district takes in as revenue.

MS. A. HAGEN: Boards are indeed at various times becoming more entrepreneurial simply because this provides some additional sources of revenue, and it will be interesting to see how that develops over some period of time.

I want to turn to the issue of referendum, which I think without question has been the most contentious and — if I could use this word in its true meaning — disreputable aspect of this bill. It certainly is a clause that is held in very poor repute by many, and perhaps including people on the other side of this chamber as well. I certainly have not heard ringing defences of referendum except from the Premier, who has at various times called it a triumph of democracy.

However, it is important for us to look at this aspect of the legislation for what it is. To repeat some comments we have made before, it is a very ill-considered, ill-thought-through method of trying to deal with what the minister believes to be a very necessary task: that is, the task of containing the cost of education.

I think that the introduction of this section is based on a myth that is wrong: that the cost of providing education services is out of control in the province. I think it is based on a second myth: that boards have been and will continue to be irresponsible in respect to their budgeting. Having been premised on two myths.... They are not myths in the sense that we sometimes use those terms, that they provide us with succour and nurture and ideas and idealism; rather they are indeed false and ill-defined and ill-conceived. What the government has done is to seek the wrong solution.

We have had, in a very unique way, a pilot project while were still debating this bill in principle. Last Saturday, nine of the 75 school districts in the province piloted the referendum. It was born in controversy and confusion. Everybody involved with that referendum dealt with it in a manner that extrapolated and exacerbated that confusion. Both in districts where the board was successful in winning support for the referendum and where it was unsuccessful, it has been roundly and thoroughly condemned as a method that no one wants to see perpetuated. No one wants to live through it again, whether they were actively involved with it during this particular referendum round or whether they might consider it in a future year.

It's really interesting, Mr. Chairman, that the response has been such a tempered one. It has been more in the nature of a plea than an explosion. I think it was best put by the chairperson of the Vancouver board — a board that is politically conservative as well as conservative, I believe, in how it has carried out its role — who said: "Look, this is not a system that we want to work under. Let's sit down and look at what the minister's and the government's concerns are about the responsibility and role of boards in financing education. There are other solutions available that will be good for boards, will answer the concerns of government and, most fundamentally, will be better for kids.

I could go through the list of reasons why this particular clause and all the ramifications that run throughout this section and this bill are not good for education. We could talk about the fundamental problems it has created between the minister and boards. We could talk about the fact that it is premised on out-of-control spending. We could talk about the fact that it asks that boards spend money year after year to confirm the same decision of a district — because only annual decisions can be taken by a referendum.

We could note that this legislation will discourage boards from being innovative and from consulting with their communities. It will discourage those lighthouse boards that in the past have helped provide us with some direction for the framework for "Year 2000" initiatives, because the task of getting extra dollars and resources to carry out innovative projects will be daunting, and boards will be discouraged from undertaking those tasks.

We could talk about the fundamental flaw — I think the minister has referred to this as well — in saying that we are going to stipulate what must go to referenda and that boards have to find ways to take those programs that they think are most salient and saleable in order to get that support. It goes against everything that I think the royal commission and the royal commissioner, Mr. Sullivan, were talking about concerning co-management, joint responsibility, working together and finding consensus. Those are the ways in which boards make decisions on the funding of education.

There are no objective facts that bear out that spending is out of control, that boards are not responsible in their budgeting, that this draconian measure — which fails far more times than it works, produces far more problems than it was ever intended to solve and saps energy, time, resources and the impetus for long-term planning — will be met with the continuation of this referendum process.

The minister has been asked personally and editorially, through the comments of leaders in education — parents, trustees and people who work in the system — to take a sober second look, to sit down and talk about the issues and the methods of their resolution and, for heaven's sake, to put this particular bad, ill-conceived and destructive element of this bill to bed and make a commitment that we won't be facing it in another year.

[4:30]

Mr. Chairman, there has been no way that we could bring in an amendment that could deal with referenda, because although there is one specific clause that defines how referenda will be run if boards decide they are forced into this measure, all through the bill, the implications of referendum are a fundamental element. It's not an aspect of the bill that can be amended by a simple clause or two that we might ask to have struck from the bill. We could do a symbolic gesture of moving to amend this clause, but

[ Page 9516 ]

because of the way in which referenda are referred to throughout the bill, it really would not serve the purpose. Moreover, if the referendum is not a part of this bill, there are other elements of the legislation that would have to be encompassed.

There are ways, I think, in which we can see the initiatives that government has taken on improved funding for education and improved management of the system and effective and important changes in curriculum. There are ways in which we can follow through with the mandate that we had with the Sullivan commission: that it be a task that we undertake cooperatively and through consensus.

I would note that not once has this Legislative Assembly been asked to deal with any of these issues. I could go back.... In committee, not once have a group of legislators been given any opportunity to discuss this issue. It's part and parcel, again, of a point I make whenever I get the opportunity: that although there is a Select Standing Committee on Health, Education and Social Services in this Legislature, not once in four years has any matter been referred to a joint group of legislators from the government and the opposition side of the House to look at an important public policy issue. This might be, in fact, a matter that this minister could refer to such a committee for review and work and a recommendation, so that we could see a change in this initiative and never again face it in the finance section of the School Act. That would be, I believe, based on the pilot project, based on the experience, based on the public consensus, based on the ill-conceived, ill-thought-out and ill-planned decision to bring in a referendum process. That procedure would be welcomed and would be consistent, I think, with an approach that this minister has taken, over a number of years, with the challenges in education that he has sought to face.

I said earlier that this decision alone is going to mark what is otherwise a record that this minister is himself proud to speak about and that I think many people have commended. I would urge the minister to again make some commitment that this particular clause, this method and approach, is one that he is prepared, as various people have said, to address with a sober second look. Nothing that the minister could do at this time would be more beneficial to the long-term agenda of a healthy, well-financed, responsive and responsible education system.

The challenge lies with this minister and with this government. I would hope that he might give us some signal or some indication that he would be prepared to rise to the challenge and to respond to public opinion, public concern and public desire with those kinds of changes.

HON. MR. REYNOLDS: I seek leave to make an introduction.

Leave granted.

HON. MR. REYNOLDS: I would like the House to welcome 50 students from Hillside Middle School in West Vancouver, who are here today with their teacher, Mr. B. Herrin. Would you please make them all welcome.

HON. MR. BRUMMET: I know the member has called it disreputable, and that it's unacceptable to everyone. I don't know how she forms that conclusion, because I certainly get the impression from the public that there's a lot of support for some way of, not cost control in education, but cost control about increases.

The member says there's absolutely no factual justification for taking this position. Well, in an economy running at between 4 and 5 percent, and because we consider education a priority, and because there were some places where we were behind, in the last two years alone we increased education grants from the provincial government by 20 percent. School boards, with the supplementary option, increased that to 25 percent — a 25 percent increase in two years after about a 20 percent increase in the two previous years, in an economy running anywhere from 3 to 5 to 6 percent, looking to the future.

Government has also undertaken a major revision of the education system based on the Sullivan commission report. Whether those members over there will ever acknowledge it or not, the cost control measure that we have taken may well assure the continuation of those changes in education.

Even with the referendum option this year, we have increased operating budgets in this province by 9.9 percent, when the average across Canada is probably around 4 percent. It ranges from 3 percent to 5 percent in the other provinces. That's the increase, including enrolment increases. Ours is 9.9 percent this year, including enrolment increases, and we have picked up in the block funding the whole 25 percent increase, because all the costs in education before that....

A lot of distortion goes on. Many of the members on that side keep coming up with the statement — I guess they think if they say it often enough, perhaps it will develop some degree of truth — that obviously this Minister of Education does not support referendums. They use that, because two years ago the question was asked: "Do you think that education funding should depend on referendum?" and I said: "Absolutely not; it would create inequities, and it would create problems." I still to this day don't think that the funding of an education system in this province should depend on referendums.

But they forget....

Interjection.

HON. MR. BRUMMET: Oh, quiet down and listen; you might learn something. I wonder if there is any way we could send him to a conference, because the House is always a lot better without him here. Despite the fact that I was so rudely interrupted, I would like to conclude my statement about referendum.

[ Page 9517 ]

I am also satisfied that with the block funding approach and with tying it to the increase, it will be in line with the economy. It was recommended by the royal commission that the funding should be a block system with autonomy for boards to move the money around in that block. We have accomplished that.

We have said that it should not be on a roller-coaster ride by willy-nilly decisions each year. Boards should be able to know what to expect, and we have said the increase will be based on the economic indicators. That means that the taxpayers know, and I think they are not averse to increasing the funding on education by what the inflation index increase is.

Another figure I can give the member.... I have studied this a great deal, and I think I've managed.... Our government has accepted the valid arguments that are made. If the increase in education spending had been in line with inflation since 1981, the average cost per pupil in the 1989-90 year would have been $4,118 per pupil provincially. When we added up where it was, it was at $4,954 per pupil. So I think that we can honestly say that the spending on education has considerably exceeded the economic indicators and inflation.

I am satisfied that now the government will take full responsibility for all the actual costs that were expended on public education this year — the actual expenditures — and that this year we had, as the economic indicator suggested, added another 6.17 percent. The government is taking full responsibility for 100 percent of this year's expenditures plus the economic increase. That means that the continuation of the quality education system we have in this province is assured and guaranteed.

Implicit in the block funding in the Sullivan report was that we shouldn't wonder how much it's going to be. Implicit in that was if the block includes all of the money necessary to run that educational program, and it is linked rationally and reasonably with the economy, that is the amount of money that should be available for public education each year. And having satisfied myself that all that was in place, then there should have been a cap; that should have been it. That's the other option.

When you're funding everything, and funding the increase and guaranteeing all of that, that should be the end of it; that's all you need. We have gone well beyond that with the royal commission. For any mandate changes, we have assured that. For any enrolment increases, we have assured additional funding. We have moved up from $250 million for major and minor capital to $350 million. It will never be enough because every time we get more money to build the schools we need, that of course gets newer schools out there and everybody wants to fix up the schools that already exist. So there is absolutely no way that we can keep up. But we're doing, I think, a pretty good job of keeping up.

[4:45]

We said that the royal commission implementation is going to cost extra money. Two years ago we committed to $1.4 billion for operating costs over and above whatever the operating budget would run. That is additional funds. We committed to computer funds because we think computer technology is important.

So when you add all that up, it goes over $3 billion this year — a 15.2 percent increase — and it goes up to about $5,980 per pupil that we're spending on public school education in this province. That compares favourably with any other jurisdiction in Canada. Our quality of education already compared favourably, but we weren't satisfied; we wanted to do better.

Let me go back then. I said that I didn't think that education funding should depend on referendum. And with all I have told you, education funding does not depend on referendum. I fully supported and recommended that if school boards want to spend beyond that amount, they should get the approval of their taxpayers. Because through the fiscal framework we have looked after equitable funding for any student and any district in this province, regardless of where they are, regardless of how remote.

We have done a lot in distance education by improving technology, by moving the regional correspondence schools out there. That's extra. We've done everything to make the situation equitable. The opposition and some of the school boards — particularly those of the same political stripe as the opposition — have repeatedly said....

Interjection.

HON. MR. BRUMMET: Well, they've made no bones about it. Your party runs them as NDP candidates for school board — openly, up front — and then you wonder why I wonder if they are partisan.

However, the whole point is that these people have said that referendum will create inequities between rich and poor districts. It is not true, because the fiscal framework picks up the variables between districts.

I had to consider two options with the block funding and the economic adjustment factor in there. There shouldn't be need for any additional spending beyond that or to open the door for where school boards and their taxpayers felt that additional expense was warranted. And we have referendum because I chose option B to open that door for boards anywhere in this province, with the approval of their taxpayers, to spend more than the block funding and the economic adjustment factor warranted.

People have seen that as an erosion of autonomy. With the block funding there is more autonomy for school boards to set their priorities with all the money they had last year and another 6.17 percent. School boards may recall periodically — and it may even dawn on the opposition members once in a while— that under the new School Act, school boards have been given the responsibility to determine the educational program for each and every student in the system. They have a lot of autonomy.

Teachers, under the "Year 2000" program, are being given the professional autonomy in the classroom to decide how that education is to be delivered

[ Page 9518 ]

and achieved. There is more autonomy based on more consultation than we have ever had in the history of this province.

That education critic said that we might have done some good things in education and this one clause in the referendum defeats all of that. Some people have even said that my popularity has now waned. If my popularity as Minister of Education was based and predicated on keeping up 25 percent increases in spending every two years.... And that wasn't enough, because I remember that last year and the year before that, the opposition said it wasn't enough.

When we decided to go with the royal commission, they were against it. When the royal commission report came in, they said: "It's a ruse. They're going to put it on the shelf." When we decided to implement the policies of the royal commission, they said: "Oh, we expected them to put it on the shelf. They're going ahead with it. You're rushing it. You shouldn't be going ahead with it." Even now, the opposition and some other people are saying: "Put it on hold. Put the changes on hold. Delay them." For how long? There isn't one thing that is happening for the good of education that that group has supported anywhere along the line in the last three years. So am I to be surprised that they don't support this?

Now they say that the referendum is going to destroy all of that. Mr. Chairman, as far as I'm concerned, I wanted to see that all of the good things that have happened in education.... I wanted to be assured that they would be continued, and the taxpayers' support is necessary for that. We must maintain that taxpayer support.

By saying "reasonable increases in line with the economy" and "some cost controls for additional expenditures above that," I think we have gone a long way towards assuring the continuation of a quality education system in British Columbia. It's a guarantee that it will continue and a guarantee that it will allow us to make the changes that are necessary.

MR. BLENCOE: Mr. Chairman, I think the minister doth protest too much. He seems to be extremely thin-skinned. This side of the House and the people of the province know why the referendum was introduced for school purposes. It is a cynical political move by this administration to try and find, in its desperation, an election issue. It is an election issue: raising flags, trying to find something to grab on to — another tactic by a government that has run out of time. The people of the province know that the time has come for change. This is another cynical ploy by a government that was prepared to use the classroom and children in an attempt to get re-elected. That's what it's all about.

Why did the Premier...? Let's make no bones about it. It wasn't necessarily this minister, because we know his position on referendums. It's been quite clear, despite what he's been trying to say today. He's on the record as to what he feels about referendums for school purposes. This came right out of the bubble machine that creates information on the part of the Socred administration. It said: "We need to find some issues, some way to try to get ourselves re-elected."

Why pick children as a pilot project? Why pick the classroom as a pilot project? When we've just started to get the classrooms in the province back to normal after all of the problems we've had because of this administration taking on teachers and therefore taking on children in the classroom, why pick children to test the referendum?

It has nothing to do with democracy. It has nothing to do with this government's.... They're saying that it extends democracy to the citizens of the province. Heavens above! If we ever wanted a referendum, it was on the overruns on the Coquihalla Highway. If we ever needed a referendum, that's where: on the expenditure on the Coquihalla Highway.

Why pick children? Maybe we should have had a referendum on whether the Premier should have bought a new jet for $7 million or $8 million. That's what we should have had a referendum on; not on schoolchildren.

The minister took 15 minutes again to try to defend his position, which we know. He has been on the record for some time as being opposed to referendums for school purposes, Today he tried to defend his position, because he knows that the government is in a desperate situation with the citizens of this province. They're tired of the same administration, which has created havoc in so many key areas of this province.

I think it's a sad day, Mr. Chairman, but once again we see a government that is going to turn the classroom and our schools into areas for fighting and confrontation, when we're trying to bring peace and stability back to them. If there was one thing the Sullivan commission said we needed to do, it was to bring a stable, predictable system of funding back to education in the province. We're going in the opposite direction.

My school board decided not to go for the referendum — School District 61, the Greater Victoria School Board. The board is very progressive. It's been tightly managed and properly organized. They have traditionally been very well organized and have managed the books and the affairs of the school district extremely well. But I'm concerned, as are they — and I've talked to trustees, parents and others who are involved in the education system in this area. If they want to do something innovative, beyond the scope of what the minister perceives to be important in the education system — for instance, earthquake preparedness to strengthen our schools in preparation for earthquakes — they have to go to referendum. They cannot make that decision without going to referendum, Mr. Chairman. That is of great concern. Boards need the flexibility. They are elected to make those decisions and to assess the priorities of their districts.

Speaking for the Victoria school district, I think this concept of a referendum is an insult, in a way, to that school board and to other school boards....

[ Page 9519 ]

MR. CHAIRMAN: I'm not sure, hon. member, whether you're still on section 5. It appears that you're speaking on the section that follows section 5; it deals specifically with referendums. So I would suggest you gear your comments in relation to section 5, which we're dealing with.

MR. BLENCOE: Mr. Chairman, we are speaking on the issue of referendums, it is my understanding. That is what I am trying to speak on, because I believe the referendum concept will create inequalities in the system. I happen to believe that we've had a system for school funding that has served us well for a long time in this province. I think this concept of referendum will create further inequalities and will create have and have-not districts and schools, and that is something we want to get away from. That is something the royal commission said we had to avoid. We wanted a stable source of funding for our schools,

We have all the evidence from other jurisdictions, other countries, that had decided to use this concept for school funding. In the United States schools closed and we saw have and have-not districts and schools created. We don't want to see that in British Columbia. I certainly don't want to see that in my district, because I happen to think that we have a good school district in Victoria. They have been responsible with taxpayers' money, and they have tried to be responsible in utilizing school funding and dollars that are provided for school purposes.

[5:00]

I have to go on record that I think this is clearly a move in the wrong direction. As the people in British Columbia have seen through other schemes — like a balanced budget and a BS fund, which they now know are non-existent — I think those involved in the education system have seen through what the referendum is supposed to do. It's supposed to create confrontation, and it's supposed to create have and have-not districts. It goes in the opposite direction of what we want to do for the children in our classrooms in British Columbia.

HON. MR. BRUMMET: I recall the expression: there are none so deaf as those who don't want to hear. It certainly applies to that member. I had just finished explaining that this assures the continuation of the system for the children in this province. It may not provide 10 percent wage increases in a 6 percent economy, but it certainly will see that the children get a good education and that the education system will improve, as recommended by the Sullivan report. From everything that has happened out there — despite some of the protests from the opposition and others — there are good things happening in the school system, and teachers are seeing a lot of things happening.

They accuse us of being political. If you are so politically motivated, Mr. Member, and if the referendum is so bad for us on this side of the House, you would think that you would rush to support it so that it would hurt us. I think you're frightened by the fact that the taxpayers in this province, the people in this province, are very supportive of this measure. I don't really expect NDP support no matter what I do, but you would think that in their own political interests they would support this and let us get on with it quickly.

Similarly, maybe we could get on and get away from seeing education as strictly a funding issue which has boards not looking at the only option being if you want more eggs, you add more egg crates; and if you want to do something different, you add more money. With the money available, I think there's going to be far more innovation and creativity, because that happened many times in the education system when I was there, and it's happening out there every day. When people consider education first — when they consider that the kids come first — the teachers out there do a great job. I know the opposition has tried to attribute to me — because I don't come up with a 20 percent funding increase instead of 15 percent — that I am teacher-bashing. I have not bashed the teachers in the classrooms of this province at any time. I am well cognizant of the work that they do.

If it all depends on 15, 20, 30 percent increases and disregards the wishes of the public of this province, then I am afraid that could damage the education system for the kids. I have never made any apologies. As minister, as a teacher, as a principal, my first priority has always been the best interests of the kids in this province.

MS. A. HAGEN: It's clear that the government is committed to a referendum process in spite of objective information and perspectives that would suggest how ill-conceived that decision is. We're not going to get any further in that debate here. I think it will be debated out in the public.

Funding issues are resolved by referendums rather than by decisions based on the kind of information that boards and communities need and can develop together. The very nature of this referendum process — with a two-week notification and all of the paraphernalia that has to be in place — bears that out.

I said at the end of my second reading speech: "I rest my case." There has been a lot written on referendums. I like a statement that was made by the very temperate and thoughtful past-president of the B.C. School Trustees' Association, and I just want to read from that statement as — not the final word on the subject — my final word on it in this committee debate: "There has been much referenda rhetoric in the last while," says Mr. Hingston. "Most of you," and he is speaking to his fellow trustees, "are well aware that the BCSTA opposition to this surprise announcement was based on what we believe are sound, principled positions."

I think that is perhaps the way in which we want to try to look at this particular approach to education, which will take us off the track, which will create conflict and which will be a troublesome element in education finance over the next little while. Those are

[ Page 9520 ]

my words. Back to Mr. Hingston's words. The BCSTA positions are:

"(1) The already-mentioned betrayal of the EAC process" — that's the Education Advisory Committee, which had worked diligently on a finance formula and process and policy and procedural recommendations — "(2) an objectively based rebuttal to cabinet's descriptions of board spending being out of control; (3) the all-or-nothing, win-lose nature of referenda giving no room for compromise; (4) the certainty of inequalities, especially over time; and (5) an examination of the referenda experience in other educational jurisdictions."

In spite of what the minister has to say — in spite of his defence that there is enough in the system so that no board ever needs to go to referenda — there is fundamentally a flaw in using this method that we believe should be accepted and reviewed. A sober second look is not going to occur. Therefore this is an issue that we will be continuing to discuss in the public. I am sure that we will find — as we have up until now — that most people do not, on experience and reflection, believe that referenda should apply in the public school system.

Again, we offer opportunities for discussion around some of the concerns that the minister has addressed. Trustees and many people who are concerned about education have said the same thing: the minister's mind is made up; his government's mind is made up. I rest my case. Others may want to speak on this aspect of the bill, which is one of two that we think are not in the interests of education and that will take us away from attention to education and what's happening in our classrooms. It's implicit in referendums that that will be the result.

I want to turn now to the third issue, which is a fundamental principle issue in respect to this legislation: the government's claim that it is now funding 100 percent of its block, and the government's initiative to set, and then take into consolidated revenue, residential taxes which have traditionally been set and collected by school boards.

There are two aspects of this that I think we want to address. One is the symbolic aspect that for the first time in the long history of school boards and Ministry of Education efforts in respect to the funding of the school system, we are looking at the autonomy of boards to set taxes, collect taxes and use them within their own districts being literally abolished.

We are looking — for the very first time in the history of this province, to my knowledge — at taxation from residential resources becorriting a part of consolidated revenue. We are looking at the minister having the absolute authority to set those taxes with nothing in this legislation to indicate whether those taxes will represent 1 percent, 5 percent, 10 percent, or — to be quite facetious — 100 percent of the block. There is absolutely nothing in this legislation to indicate to what level the local taxpayers are going to be paying residential taxes for school purposes.

The autonomy of boards to make decisions around taxation has been taken away in two ways. First of all, that block is now being funded by taxation decisions made by the provincial government, and of course the referendum is now the only means by which boards can make decisions about local taxes which they might wish to employ for school district activities that are the product of local decision-making.

There's a fundamental uneasiness on the part of boards and districts with this initiative on the part of government, partly because of the long tradition of how schools have been funded, and partly because in setting this precedent, municipalities are wondering when the next shoe may drop. There's a kind of anticipation that there might be other initiatives on the part of this government to look to local taxation as a means of funding provincial programs.

Once again this has been done without discussion and without any due process in terms of those decisions being made. The autonomy of boards is undermined by this process. Again it's a methodology that suggests that the decisions will be made by the provincial government, only by the provincial government and without any framework. Are we going to be looking at the current framework which says that 90 percent of the block funding will be coming from the provincial government and 10 percent will be coming from residential taxes that eventually come into consolidated revenue and are paid back to school boards? Or are we going to be looking at some other kind of percentage? None of this is enshrined in this legislation.

The stability that Sullivan talked about with a program or a system that would be in place for a number of years is in no way guaranteed. This government, when we speak of trust, could decide next year that it will establish a very different basis than the basis it has decided upon this year, when it has in fact moved to improve the balance between what comes from its provincial revenues and what comes from the residential base.

There are some speakers on this side of the House, Mr. Chairman, who want to speak to this issue. We feel that it is a move that sends out signals to school districts that has them questioning whether their role and their responsibility are secure, and whether this is just a first step toward eradicating school boards except to do the minister's bidding and to do what the minister says is appropriate, since he is working to "pay the piper" — if you like — to pay the cost of education. That's not a co-managed system; it's not a co-shared system; it's not a system that acknowledges the responsibility of both parties. In that regard, school boards are rightfully questioning what this government has in store for education in terms of the autonomy of boards.

Mr. Chairman, I think the second member for Vancouver East (Mr. Clark) wants to comment, but the minister may want to respond first.

HON. MR. BRUMMET: Just very briefly. Yes, the province has now assured 100 percent of the funding for the block and, of course, all of the other money which we assured anyway. But 100 percent of the funding for the block is assured by the province,

[ Page 9521 ]

therefore the province needs to come up with that money. We've made it fairly clear that with the tax relief that has been built into the extra homeowner grant, it now works out that about 90 percent of it will come from general revenue, which includes a lot of things, and about 10 percent will come from residential taxation.

I can assure the member, however, that 100 percent of all the money we spend as a government comes from the taxpayers.

[5:15]

[Mr. Pelton in the chair.]

MR. CLARK: The minister has been fond of accusing members on this side of the House of playing politics with the education system. But clearly this is a case, in the particular area the member for New Westminster (Ms. A. Hagen) talked about.... The minister might even agree that there's a lot of politics involved here.

I want to make a couple of points. First, the government now completely controls residential taxes. It's now centralized on provincial control to levy the rates. This bill gives them the power to levy residential tax rates around the province. So the government could have reduced the tax rate on residential consumers by whatever they liked and increased the provincial component, but they chose not to do that. They chose to keep the tax rates the same and bring in another bill to bring in a supplemental tax break for property taxpayers, a supplemental homeowner grant, so that they could be the good guys to ride to the rescue of the residential taxpayer. They now control the levy that's being placed on residential consumers.

They could have reduced the tax rate on school taxes paid. They're the ones in control of it. They've taken complete control of the residential tax base away from school boards, kept the tax rates at what they would consider to be too high a level, brought in another bill to provide a complicated formula to give some tax relief for some homeowners and not for others, when clearly they could simply have done the rational thing, instead of playing politics, and reduced the tax rate. They now control it.

Having said that, Mr. Chairman, I want to talk a little bit about that. A few years ago, the government removed the industrial and commercial tax base from school districts. This may not be popular to say, as a Vancouver member, but I happen to think there's some merit in that idea. Certain school districts benefited disproportionately from that ability to tax, Vancouver being one of them. I don't have any problem philosophically with the government taking control of the industrial and commercial tax base and dividing it up more equitably among the school districts. My fight with the government over that act was not the taking away of that tax base from school districts but rather the fact that they did not increase the rates at all for several years and even now have not increased the rates proportionate with the residential taxpayers. That is the problem. The industrial share has declined because of provincial government action. But the concept behind removing the industrial and commercial tax base and sharing among all of the school districts is one which I personally don't have a problem with.

Now the provincial government has taken away the residential tax base from school districts. I wonder if the minister could comment with respect to the same principle. The government has taken away the industrial and commercial tax base, which really only impacted negatively on half a dozen school districts, and they have shared it with the rest of the districts. Presumably they've benefited by this provincial government initiative. Now that they've taken away the residential tax base, is it the government's intention, with respect to this bill, to bring about some kind of equity of school taxes paid throughout the province, given the principle that they've expressed with respect to the industrial tax base.

For example, if we assume — and these numbers are far from accurate, of course — for the sake of illustration that Surrey taxpayers are paying $100 in school taxes and Delta is paying $80 in school taxes, now that the provincial government has complete control, is it their intention to, say, move to $90 in school taxes for those two school districts, to bring about some equity with respect to all taxpayers in British Columbia? Under this bill they will now control all school taxes in the province. Is it the goal of the government to ensure that all property taxpayers in British Columbia pay more or less the same school taxes? Is that going to be a goal of this administration?

HON. MR. BRUMMET: If it were but as simple as the opposition critic decides it could be, then it would be easy.

Is it the intention of government that everybody pays the same tax? What do you mean by "the same tax"? Do you mean that everybody pays $100, or do you mean that everybody who has a $100,000 home, no matter where it's situated, pays that? And what do you mean by "tax rates"? Do you mean that the 18 mills generated in one district times whatever the property values are, compared to the 3 mills or 5 mills...? Do you mean that as the tax rate? Or by the tax rate do you mean the amount that the person pays, and those sorts of things? Yes, there could be a change in the tax rate. We looked at various options and felt that the fairest one was to use the homeowner grant. Everybody gets $430. If you change the tax rate, the person who already has some money to carry over to their municipal taxes gets a decrease and is paying a fraction of the amount that somebody in a 14-mill district is paying on a $200,000 house.

The Finance minister has said 25 percent of the difference over and above the $430 this year and another 25 percent next year, which will level it off. It will never make it equal for each person, but I think it will make it a lot more equitable.

When we talk about the industrial tax and the commercial tax, that was brought in.... The government chose to decrease that as an economic incentive.

[ Page 9522 ]

If you notice what's happened in the province, it didn't work that badly. As a matter of fact, it worked quite well. However, the total gone into education kept going up. Some of that, about 15 percent, was from residential taxation, but the rest of it was from general revenue — the increase was far more than the decrease in the industrial and other revenue.

I don't know if the member is aware that if you total up all of the residential tax collected for school purposes in this province and add that to all the tax collected from commercial and industrial, it makes up less than half the total that we're spending on the public education system. So guess what? The other 55 percent is coming from other sources. Every dollar that comes to us in residential tax and commercial and industrial tax for school purposes goes back out there and has to be more than doubled from some other source.

MR. CLARK: I wonder if the minister, seeing as he has all the staff here, could tell me exactly how much is generated by the industrial and commercial tax base and how much by the residential tax base.

HON. MR. BRUMMET: I don't have the exact figures. The non-residential tax base in '89-90 was $535,000. The total that we took in from residential tax was about $750 million. That's the total before the homeowner grant. If you take the homeowner grant and reduce it, then you're down to $400 million or whatever. Last year it was $350 million. With the changes it looks like it will be $400 million or something. Of course, it will vary this year depending on assessment values. We've had quite a bit of construction in the province, so it keeps changing every year. That was last year's.

MR. CLARK: I appreciate those numbers. It would be useful if they were in the budget or readily available. I could be wrong, but I don't believe they are.

I wonder if the minister could give me some guidance, then, on his philosophy in this regard. The government has taken away the residential tax base from school districts. I want to get a sense of how rationally this will work over an extended period of time. I'd like to know how the government sees this working over a decade or so.

This year the government has said: let's look at last year's taxes, which were based on an independent or semi-autonomous school board which levied those taxes. It froze them at that level. So last year the taxes were frozen; this year the taxes are frozen at last year's level, presumably. In other words, it's easy this year for this system to work, from the government's perspective, because last year's school taxes paid were based on an autonomous school board levying those taxes to meet certain programs. The government has now accepted all those programs in their block funding, presumably, and can set the new tax rate for school property taxes on the basis of last year's and can then play around with the homeowner grant to accomplish the political ends required.

1 wonder how rationally this will work over time. Ten years from now, presumably, the ministry will have to go in and set tax rates for each individual school district. In the past, they were based on a school board which was close to the situation, dealing with priorities and all of that stuff and levying taxes up and up every year, or whatever. I wonder how the minister sees this functioning over the long haul in terms of a rational plan for funding education — how the property tax payer will pay.

In addition, I wonder if it is the government's intention over time — he doesn't have to make a commitment that it will be next year or in the next five years — to bring about some equity within the system of property taxes paid, given that they've now centralized control and it no longer has anything to do with the local school board in terms of setting how much money is collected by school taxes.

Thirdly, the other option the minister might comment on is whether in fact 90:10 is the magic number, so that we keep the ratio of residential taxes to general taxes at 90:10; therefore the budget is increased appropriately and all property taxes are increased above their current rate to keep in line with the 10 percent target. That's the third option I present to the minister for comment.

HON. MR. BRUMMET: Not having the financial wizardry at my fingertips that the member has, Mr. Chairman, I can't predict the amounts. I do know that when costs go up, taxes go up somewhere.

I know that this year the effect of the tax relief is to bring down the tax share by increasing the homeowner grant, bringing it down from about 17 percent last year to about 10 percent this year, and the provincial portion up to 90 percent from 83 percent. I know that, and I assume that the total may move so that all taxes.... But they're certainly not going to be moving up as high as they would if we had unrestrained spending; and certainly many people will benefit from the tax relief.

There is also a discussion on tax reform and whether it will stay at the 90:10 or be some other system. This year, of course, the amount of the local taxes.... The residential taxes are still in place this year, so it carries on, and the calculations will be in the districts.

Whether the government will eventually move to a provincial flat rate tax and see that as equitable.... I would make it equitable tomorrow if I could get anybody to agree with me as to what is equitable. Does the person who can afford a $300,000 home have the same capability to pay as the person who bought a $50,000 home which went up to $300,000? Those are the kinds of things. So we don't know what equity is. And there is a lot of argument about what determines ability to pay and what the measures of wealth are. All of those come in.

But the government is committed to looking at tax reform to make it as equitable as possible. I guess there will be a lot of discussion on what exact form that will take, and it will probably move in stages. But that's only my guess.

[ Page 9523 ]

MR. CLARK: The interesting problem is that the rationale.... There is always a problem between accountability and spending, and the government struggled with this. I think they have made the wrong decision in several cases. But I understand the rationale, and the rationale Is that school boards want to spend more money.

[5:30]

You have to make them accountable. You want to make sure they have to raise taxes, because you can't have a system.... I agree with the minister in this, and I am sure the minister would agree with this: you can't say the province is going to pay 100 percent of the funding and school boards get to determine what they want to spend. I think all members would agree with that. You have to say to school boards: "If you want the power to determine how much to spend, then you have to be accountable to taxpayers." That's the rationale for school taxes in the first place. You say to the school boards: "You've got a certain amount of autonomy because we believe in decentralized decision-making above a core curriculum" — or something — "but you have to raise school taxes to make up the difference." And that keeps school boards in line.

Now you've taken away the residential tax base from the school boards because you think they've abused that, presumably. Okay. There's no rationale left that I can see for school boards, and that's the point the member for New Westminster (Ms. A Hagen) made.

If you believe you should have local school boards and local control of a certain amount of the discretionary spending in education, they have to have a tax base. If you've taken away the tax base, there's no logic to having school boards. That's the point. That's maybe a philosophical point. Members of the government might say — I'm not saying they are, but I suspect there are members of the government who do: "You're right. Abolish school boards; they're an unnecessary level of government."

But what's happened now is that the government's trying to have it both ways. The issue becomes — and this is where it gets difficult, philosophically — that you've taken way the ability of school boards to tax residential property, and you're now taxing them and paying 100 percent of the costs. There is no longer a rational basis for the school property tax rate, because now you are determining how much they'll go up. You are determining how much school property taxes will be.

That element of accountability which existed before with school boards no longer exists to the same extent with the provincial government. It seems to me you've lost, in terms of local autonomy and accountability that we had before under the school tax system. In other words, you've moved partway in a coherent, philosophical direction, but you haven't moved all the way. Government, from your answers, has not thought through the implications of taking the control of the residential tax base away from school boards but still having school boards somehow there, although they're no longer accountable because they no longer have taxing authority or any authority to spend money either. You've taken it away. There's no rational basis for inequities between school districts anymore. There's no real accountability anymore, because you can raise the taxes to whatever level you want. It seems to me that you've lost the benefits of having the school boards accountable by having to raise local taxes.

I wonder if the minister could comment on the direction he sees it taking, if he follows my logic.

HON. MR. BRUMMET: I guess that's why we're sometimes known as "big wheels": we go around in the same circles. What the member was just advocating is what we have just come from: that the school districts could tax.

For three and a half years I said: "Do you want to tax above what the fiscal framework provides? Take responsibility for it. Take accountability for it." They said: "Thank you, we will do that." Then they taxed, and the taxes went up by 30 percent and by 20 percent on the residential taxation. They said that if the province would put up enough money, there would be no need for the taxes to be increased.

So in the second year I said: "If you want to have this power to set taxes, then take responsibility for it." Again they said, "We'll do that," and they increased it by another 15 percent. So we got to the point where they were increasing it.

I'm not saying that the school boards are responsible, but the pressures are always there for more spending. If the opportunity is there to sign the credit card, then we get into these binds. There were no checks and balances and cost control. There is full, complete and total accountability and autonomy with any money that the taxpayers approve through a referendum. We're staying right out of that.

As for the need for school boards.... I don't think that member was in here, Mr. Chairman, when I explained earlier. School boards, under the new School Act, have been given the autonomy to set the educational program for students — 20 percent local programming. If we start looking at the school board as more than a funding lobby group and see them with the responsibility to account for the educational program in the district as well as funding the local programs and all of that, there is far more for school districts or school boards to do.

I didn't get a chance to respond to the member earlier when he said it's too bad that this amount from residential or taxation is.... I refer him to the revenue sources section of the estimates book. There's quite a bit of information in that.

MS. A. HAGEN: That was an interesting discussion. Really, we have been dealing with an important issue. It brings me back to the suggestion I made earlier, that I think some of these matters are good to have discussed somewhere besides just in the precincts of the Ministry of Finance — where I think a lot of this has gone on — and the Ministry of Education.

I am looking at the time, and because of the way in which we have been debating this bill — we've

[ Page 9524 ]

looked at a number of issues — I want to do a quick review at this point.

We have discussed the three issues that are very important to us: block funding, the referendum and the loss of local autonomy, with the taking over of the residential tax base into the provincial government's funding for education. There is a range of matters that I want to look at fairly briefly, and I'm going to try to do that. But before I do, I know that the member for Esquimalt–Port Renfrew wanted to raise a couple of issues, so I am going to ask if he might do so now.

Mr. Chairman, I know you're quite interested in whether we're going to complete the debate this afternoon. We may have to carry over briefly tomorrow, but I'm going to see if we can move along fairly quickly on part 8.

MR. SIHOTA: Yesterday, when I was discussing the Sooke School District with the Minister of Education, I was giving him some of the facts that relate to that situation. To refresh his memory, I said that what seems to be happening here is that boards are being penalized for decisions they made before, and hence they have a smaller cost baseline compared to others and never seem to be able to catch up. I gave him the example that Sooke had a cutback of $800,000.

I was talking to the people in the Sooke School District today, and they were telling me that the other reason they find themselves so far behind a district such as Saanich is that last year when it came to supplemental funding, Saanich went to their voters and asked for a greater level of supplemental funding than....

HON. MR. BRUMMET: On a point of order, I am just enthralled with the tack the member is taking, but I would say that I would be most anxious to get into the details of his district and other districts in estimates. This bill spells out the general process and procedure.

MR. CHAIRMAN: The minister makes a point. Perhaps the hon. member for Esquimalt–Port Renfrew could continue on a basis relating specifically to section 5 as amended.

MR. SIHOTA: That's fair enough. It was okay to discuss yesterday, but that's fine, and I did say yesterday to the minister....

Interjection.

MR. SIHOTA: No, I wasn't going to repeat it all. I wouldn't do that do you. I had no intention of doing that. I was just trying to refresh, or bring the discussion up to par. But that's fine. I have no problem in picking up the discussion after this has passed, during estimates.

I had another general question to the minister, and I am sure there's an answer to this. It's a thought I've had percolating in my mind about this bill. Referendums have been held and have been passed in Vancouver and Richmond, and I know there are retroactive provisions in here that will, once the legislation is passed, bring all that into law, I guess. Those referendums were held on the basis of a law that doesn't exist, but a law that is proposed.

I'm just wondering how this bill would prevent the following scenario. What prevents a disaffected voter from Vancouver or Richmond who voted no from going to court and saying, "Look, this referendum you just had is based upon a law that doesn't exist," and seeking an injunction against the board in Vancouver, let's say, to prevent their proceeding with the raising of that $7.7 million, or with calculating it into their budget? I stand to be corrected, but is that kind of situation addressed in the section on page 17 — the transitional section? How do you intend to deal with it if someone who is upset with the results of the referendum goes to court in Vancouver tomorrow and seeks an injunction against the implementation of the results?

HON. MR. BRUMMET: It might be an interesting discussion over coffee, but I have some difficulty trying to decide what a person would do if they voted that way and didn't like the results. I don't really know how to answer the member's question.

If people feel that they have some sort of legal position, I am sure they would go to see a lawyer and get the lawyer's advice. If they went to see another lawyer, they would get another set of advice. That's why we have lawyers always arguing with each other.

MS. A. HAGEN: Mr. Chairman, I want to conclude our discussion of section 5. I'd like to ask the minister if, under the referendum clause, where it says "subject to...the regulations," there will indeed be regulations regarding the referendum.

There's also a reference to that in section 151, where it says: "The Lieutenant-Governor-in-Council may make regulations...." I understand that there's a difference between "subject to regulations" and regulations being absolutely required. I want to know whether there will be regulations in respect to referendums.

HON. MR. BRUMMET: It's customary in an act that the Lieutenant-Governor-in-Council may make regulations and vary the dates or times in the schedule that is attached, so that we're not precluded from carrying on with a process because, say, the Easter weekend happens to fall on the date that is set in the legislation. So in that year it could well be changed.

MS. A. HAGEN: However, I think it is true that in this bill the government maintains the right to set the date for a referendum any time it chooses. There is a date, but it's subject to variance at any time, according to the terms of this particular bill. So what we had this year, we could have another year. This is not necessarily an unusual circumstance.

[5:45]

We have a degree of uncertainty built into when referenda are going to be held — depending on when the House is called, and all of those kinds of things.

[ Page 9525 ]

Those are just intrinsic to this bill. It's another aspect of the referendum issue which I think leaves people unsettled, because we just don't know when those referenda are going to take place. It will depend on what happens each year as to when those referenda take place.

Mr. Chairman, there are a number of other questions that we could continue to ask on section 5, but unless there are other members on this side of the House who have questions to ask on it, I'm prepared to have you call the question on section 5 as amended.

Section 5 as amended approved on the following division:

YEAS — 30

NAYS — 19

Sections 6 to 11 inclusive approved.

On section 12.

MS. A. HAGEN: This section is a schedule which prescribes the ballots that will be used for referendum. When we saw the legislation and the ballot, we were quite startled. It's a complex ballot.

Mr. Chairman, perhaps we could have a bit of order.

MR. CHAIRMAN: Hon. members, could we have some quiet, please. The member for New Westminster is trying to make a point here.

MS. A. HAGEN: When we saw the ballot, I think most of us agreed that it was one of the most complex ballots any of us have had to deal with. And because it also contains the items or elements on which a board can go to referendum, it becomes a very significant part of this bill.

Boards have a lot of difficulty dealing with their financial needs under this new legislation. I want to ask the minister just two questions.

First, does the minister intend, or have authority, to say anything about the referendum ballot that a board actually produces? Is there anything in this act that gives the minister authority to comment on what it is a board goes to referendum on — to intrude on their interpretation of this schedule and the material and information that they present to their electorate? Or is that decision entirely within the hands of the board, to interpret this schedule and put together the package that will eventually go to the electorate?

HON. MR. BRUMMET: No, we don't and didn't ever intend to tell boards exactly how to spell this out. The ballot was in three parts for a good reason. We felt the block covered things.

New and enhanced programs. We leave it to the board to describe those and to determine staffing and additional costs and to come up with a cost to the taxpayer. We didn't want to put in just one lump sum, because we wanted to give people the opportunity. They might vote, for instance, for a capital program; they might not vote for more staffing; they might not vote for increases here or there. This gives people the option of giving not a total rejection or a total approval.

Additional activities for students. Probably the best example is that in the north there might be a school district and the parents and everybody agree that they'd all like to spend $300,000 in the year to make sure that their kids have a lot of travel opportunities. That could come under that section. It could pass and the other two could not.

So that's the reason for the three parts. We did not try to say: "And this is what it includes." But I think the boards should be responsible and accountable for what they go to their taxpayers for. This year was rushed. Next year they will have more time.

MS. A. HAGEN: I will just ask one more specific question, Mr. Chairman. If the board said that under new and enhanced programs one of the purposes of this referendum was to reduce class size, does that fall within the prescription of the referendum, as the minister understands it?

HON. MR. BRUMMET: Yes, I would imagine it would. But it puts them in the position that if they reduce class size, there is a staffing problem. The referendum, they were clearly told, was a one-year approval. So that would force them to maintain that, to keep going to referendum — either that or increase class size according to referendum. So boards were told. "Be careful. If you build it into the block, we don't increase your block next year. We increase the block next year."

MS. A. HAGEN: I'm going to rest my case on the minister's words. In fact, if boards want to — with local autonomy — make some decisions to improve the quality of education for kids, they've got to go back annually to do it, if they can't do it within the block.

Section 12 approved.

Sections 13 to 34 inclusive approved.

[ Page 9526 ]

Title approved.

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

Motion approved.

The House resumed; Mr. Speaker in the chair.

Bill 11, School Amendment Act, 1990, reported complete with amendment.

MR. SPEAKER: When shall the bill be considered as reported?

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

Leave granted.

Bill 11, School Amendment Act, 1990, read a third time and passed.

Hon. Mr. Richmond moved adjournment of the House.

Motion approved.

The House adjourned at 5:58 p.m.

Appendix

MOTIONS

By leave, the Hon. C. H. Richmond (Minister of Forests) moved —

That this House authorize the Select Standing Committee on Forests and Lands to examine, inquire into and make recommendations with respect to exemptions under Part 12 of the Forest Act and in particular, without limiting the generality of the foregoing, to consider:

1. the criteria and procedures for determining the availability of the exemptions pursuant to section 136 of the Forest Act; and

2. the conditions, fees and permits imposed pursuant to section 137 of the Forest Act;

and furthermore, that this House authorize the Select Standing Committee on Forests and Lands to examine, inquire into and make recommendations with respect to the prices of timber bought, sold or traded on the Vancouver log market and in particular, without limiting the generality of the foregoing, to consider:

1. whether such prices represent or reflect the true market value of species for export or domestic use; and

2. the suitability of such prices for determining the relative values of different species for the purpose of calculating stumpage payable under the Forest Act;

and to report to the House as soon as possible, or following any adjournment, or at the next following Session as the case may be; 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.

In addition to the powers previously conferred upon the said Committee by the House the 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 retain personnel as required to assist the Committee.