[ Page 10023 ]

CONTENTS

Routine Proceedings

Ministerial Statement

Tiananmen Square anniversary. Hon. Mr. Dirks –– 10023

Mr. Harcourt

An Act to Provide for Rent Stabilization (Bill M213). Mr. Blencoe

Introduction and first reading –– 10024

Renters (Security of Tenure) Act, 1990 (Bill M214). Mr. Blencoe

Introduction and first reading –– 10024

An Act to Provide for a Rentals Mediator (Bill M215). Mr. Blencoe

Introduction and first reading –– 10024

Oral Questions

Travel expenses. Mr. Clark –– 10025

Shortage of perfusionists. Mr. Perry –– 10026

Motor vehicle inspection. Mr. Lovick –– 10026

Quintette coal-mine. Ms. Edwards –– 10026

Business development centres. Ms. Cull –– 10026

Helpline for children. Mrs. McCarthy –– 10026

Committee of Supply: Ministry of Social Services and Housing estimates.

(Hon. Mr. Jacobsen)

On vote 59: minister's office –– 10027

Mrs. Boone

Ms. Edwards

Mr. Perry

Home Owner Grant Amendment Act, 1990 (Bill 14). Second reading.

(Hon. Mr. Couvelier)

Hon. Mr. Couvelier –– 10034

Ms. A. Hagen –– 10035

Hon. Mr. Brummet –– 10037

Mr. Barnes –– 10039

Mr. Reid –– 10040

Mr. Clark –– 10041

Mr. Loenen –– 10042

Mr. Zirnhelt –– 10043

Hon. Mr. Couvelier –– 10043

Income Tax Amendment Act, 1990 (Bill 15). Second reading.

(Hon. Mr. Couvelier)

Hon. Mr. Couvelier –– 10043

Mr. Blencoe –– 10044

Mr. Clark –– 10044

Hon.Mr. Couvelier –– 10045

Personal Property Security Amendment Act, 1990 (Bill 26). Second reading.

(Hon. Mr. Couvelier)

Hon. Mr. Couvelier –– 10045

Mr. Clark –– 10045

Hon. Mr. Couvelier –– 10046

Fuel Tax Validation Act, 1990 (Bill 30). Second reading. (Hon. Mr. Couvelier)

Hon. Mr. Couvelier –– 10046

Mr. Clark –– 10046

Hon. Mr. Couvelier –– 10046

Financial Institutions Statutes Amendment Act, 1990 (Bill 32). Second reading.

(Hon. Mr. Couvelier)

Hon. Mr. Couvelier –– 10046

Mr. Clark –– 10047

Hon. Mr. Couvelier –– 10048

Taxation Statutes Amendment Act, 1990 (Bill 39). Second reading.

(Hon. Mr. Couvelier)

Hon. Mr. Couvelier –– 10048

Mr. Clark –– 10049

Hon. Mr. Couvelier –– 10050

Budget Measures Implementation Act, 1990 (Bill 19). Second reading.

(Hon. Mr. Couvelier)

Hon. Mr. Couvelier –– 10050

Mr. Miller –– 10051

Ministerial Statement

Environment Week. Hon. Mr. Strachan –– 10052

Mr. Zirnhelt

The House met at 2:03 p.m.

Prayers.

HON. MR. DIRKS: Mr. Speaker, it's my pleasure this afternoon to introduce to the House His Excellency Franqois Bujon de l'Estang, Ambassador of France to Canada, who is visiting from Ottawa. He's accompanied by his wife and by Mr. Bernard Ledun, consul-general of France in Vancouver. Would the House please make them welcome.

MR. SIHOTA: Mr. Speaker, I see in the gallery today an alderman from Lillooet, Mr. Balwant Sanghera. Would all members please join me in giving Mr. Sanghera a warm welcome.

HON. MR. COUVELIER: Mr. Speaker, on behalf of my colleague the member for North Vancouver-Seymour, the Minister of Energy (Hon. Mr. Davis), I'm delighted to ask the House to recognize the presence in our midst this afternoon of a number of business people from the Vancouver area: Mr. Chris Carl, Mr. Mike Roche, Mr. Sheldon Eggen, Mr. Peter Jesson, Mr. John Parks — who, by the way, served in this Legislature, as many of you will remember — and Mr. Per Brunes. Please give them a hearty welcome.

MR. VANT: Mr. Speaker, in the precincts today is the Committee to Save jobs from Williams Lake: the chairman, Terry Tate, Mitch Van Dale, Wade Fisher and Ellis O'Toole. They are here in the capital because of their concern about the recent blockade of the logging road in the Chilcotin. They are here to see me, various members of government and the opposition. I would expect the House to give them a very warm welcome.

MS. PULLINGER: Mr. Speaker, I see in the members' gallery today a friend and the vice-president of the Cowicham-Ladysmith New Democrats' constituency association, Mr. Tom Harkins. I'd like the House to join me in making him very welcome.

HON. MR. BRUMMET: Visiting us today from Kyoto, Japan, from Ritsumeikan University — and they also operate a secondary school — are the president, Dr. Takeo Tanioka; Dr. Otohiko Okugawa, who is a professor in the office of development; and Mr. Kiyo Kawaguchi, who is professor of economics at Ritsumeikan University. They have 30 students now in the Saanich district who are visiting Stelly's and Parkland secondary schools this afternoon to arrange for 30 students from British Columbia to visit in Japan as part of our Pacific Rim initiative exchange program. I wish the House would make them very welcome.

MS. MARZARI: In the gallery today, bringing the intelligence of the value-for-money audit to British Columbia from Ottawa, are Mr. Jean-Pierre Boisclair, from the Canadian Comprehensive Auditing Foundation, and his director of research, Mr. David Moynagh. I ask the House to welcome them.

HON. MR. RICHMOND: In the gallery today are 42 women from the Italian Cultural Centre ladies' club. These women are very active in many events around the community, but their major effort is in organizing blood-donor clinics. They have done so for the past 11 years. In fact, they have collected something like 10,000 pints of blood for the Red Cross. On behalf of the Premier especially and myself, I would ask the House to make them very welcome.

HON. MR. PARKER: Mr. Speaker, I would like to introduce to you and through you to the House today, and ask the House to make welcome, a retired logging foreman from Terrace. He has been there since 1948 and is a strong leader in the seniors' community there. He is here to join the Seniors' Advisory Council tomorrow in their deliberations in advising the Minister of Health — Mr. Lou Gair. Would the House please make Lou welcome.

MR. RABBITT: A few minutes ago the member for Esquimalt-Port Renfrew (Mr. Sihota) introduced a constituent of mine who is attending the buildings today. He is on the advisory committee to the provincial ESL advisory body. Balwant Sanghera is a schoolteacher as well as an alderman from Lillooet. He will be moving to that great constituency of Richmond in the near future. So I'd ask the House to give him a really warm welcome.

MR. CLARK: Mr. Speaker, on behalf of the first member for Vancouver East (Mr. Williams) and myself, I'd like to join with the government side of the House to welcome visitors from the Italian Cultural Centre in our constituency of Vancouver East. They do excellent work and service in the community. The blood bank is only part of that, but it's an excellent service for people in Vancouver East. I'd like to welcome them on behalf of Her Majesty's loyal opposition.

Ministerial Statement

TIANANMEN SQUARE ANNIVERSARY

HON. MR. DIRKS: Mr. Speaker, I rise to make a ministerial statement. Today marks the first anniversary of the incident at Tiananmen Square in Beijing. Today in this Legislature we should remember the students who sacrificed so much for their cause. We're privileged in our country to enjoy unfettered freedom of choice, freedom of movement, freedom of speech and freedom of religion. These freedoms belong to us not simply as Canadians but as human beings. Though each country and each culture differ, these same freedoms are sought by all. Today we mark the anniversary of an event which reminds us of how long the journey may be.

[ Page 10024 ]

MR. HARCOURT: Mr. Speaker, I think the events in Tiananmen Square were a reminder to us all of how fragile and precious human freedom is. I may say that the Chinese-Canadian community in British Columbia and in Vancouver have a long history of striving for freedom. In China, you recall, it was the Chinese-Canadians who financed Dr. Sun Yat-sen at the start of the revolution to bring about a democracy in China. It was the Chinese-Canadian community who helped put together the Chinese Cultural Centre so that we could all enjoy the Chinese culture. In that centre is the Dr. Sun Yat-sen garden to remind us of the value that all Canadians place on the human freedoms that the students were striving for — modest from our perspective in our great democracy — such as freedom of speech and the right to have access to education based on merit, not on who your parents are or what their wealth is. So it is indeed an appropriate time for this Legislature and this great democracy of ours to mark this — I wouldn't say anniversary — one-year point from the sad events of a year ago.

Introduction of Bills

AN ACT TO PROVIDE FOR
RENT STABILIZATION

Mr. Blencoe presented a bill intituled An Act to Provide for Rent Stabilization.

MR. BLENCOE: Mr. Speaker, this bill establishes a flexible system of rent stabilization which operates when the local rental vacancy rate falls below 1.5 percent. When the vacancy rate is between 1.6 percent and 3 percent, municipalities may opt for rent stabilization. Rent stabilization ceases when the vacancy rate rises above 3 percent.

The effect of this bill, at the start of this parliament, would have been to apply rent stabilization to greater Vancouver only. It would have been a municipal option in Kelowna and Victoria, and all other urban centres would not have been affected by it.

There has been a sharp change in the rental market since 1986. At present, vacancy rates would not apply in Dawson Creek, Kitimat and Prince Rupert. It would be a municipal option in Cranbrook, Fort St. John and Kamloops, and it would apply in all other centres. New rental construction coming on stream after June 4, 1990, is exempt for a ten-year period. Small rental complexes with three or fewer rental units are also exempt if the landlord lives on the premises. The bill sets out rights for landlords and tenants. Among rights established for tenants are protection against arbitrary eviction; the right to receive compensation and relocation assistance for no-fault evictions; and the right to receive rent increases limited to changes in operating costs, as measured by the consumer price index, currently running at 6 to 7 percent.

The following are among rights established for landlords: the right to raise the rent once every 12 months; the right to raise the rent by 10 percent for additional tenants; the right to apply for special rent increases, based on....

[2:15]

Interjections.

MR. SPEAKER: Order, please. Time under the standing orders for the introduction has passed. I must therefore ask you to commit the bill to committee.

Bill M213 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.

RENTERS (SECURITY OF
TENURE) ACT, 1990

Mr. Blencoe presented a bill intituled Renters (Security of Tenure) Act, 1990.

MR. BLENCOE: Mr. Speaker, Canada Mortgage and Housing Corporation advises that in Vancouver over 6,200 rental homes were lost to conversion, demolition and changes in use in the three years ending October 1989.

This bill does three things: first, it protects renters from unnecessary eviction when their homes are proposed for renovation, demolition or conversion to condominiums, by requiring that notice shall not be served before all municipal or regional district requirements are met; second, it provides for reasonable notice for residents forced to relocate following the municipal permit process; third, it provides for actual reasonable removal expenses to be paid by the developer, together with compensation for the inconvenience and stress caused by the relocation. We propose $100 a month compensation, up to a maximum of $1,200.

Bill M214 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

AN ACT TO PROVIDE FOR
A RENTALS MEDIATOR

Mr. Blencoe presented a bill intituled An Act to Provide for a Rentals Mediator.

MR. BLENCOE: Mr. Speaker, this bill establishes the rentals mediator to administer the Residential Tenancy Act and resolve disputes between tenants and landlords. The bill is another important component of our legislative package to bring fairness back into landlord and tenant issues in British Columbia.

The bill provides for the rentals mediator to be established in the same way the former rentalsman was established by the New Democrat government of the day. The rentals mediator will have exclusive jurisdiction to mediate matters relating to repair and service orders, locks and access, landlord right of entry, security deposits, termination of the tenancy

[ Page 10025 ]

agreement on orders of possession, and service of notice.

The rentals mediator and the office would also administer the flexible rent stabilization system proposed by a companion bill and just introduced a minute or two ago. Together with the others presented today on landlord and tenant matters, this bill will help ensure fairness and equity between landlords and tenants in the province.

Bill M215 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

TRAVEL EXPENSES

MR. CLARK: A question to the Minister of Finance. Upon receipt of the comptroller-general's report into certain expense irregularities in the Ministry of Health, the minister immediately took steps to see that the deputy minister, Stan Dubas, was fired. Can the minister explain to the House why the former minister was not apprised of those sections of the report that discussed his expenses at the same time Mr. Dubas was fired?

HON. MR. COUVELIER: The hon. member makes a false assumption. He builds his house of cards on an incorrect assumption, and therefore the following question doesn't flow. It's incorrect for him to suggest that I somehow had a direct involvement in the decision dealing with the departure of a deputy minister.

As is the member's bent, he frequently on weekends makes an outrageous claim during what is normally a quiet news period for the purpose of attracting some attention. He did that again this weekend. He refers to it with the second part of his question.

In my opinion, the integrity of the system involving matters of public conduct and the damage that might be done to innocents by public discussion of these matters until investigations have been completed is a heavy matter and one that every member of this House must appreciate and recognize.

It developed over last week that apparently the RCMP themselves admitted that the issue surrounding the report had been under their examination since.... If I understand properly, the press report was March 27.

It is grossly improper, in my view, for the hon. member to suggest, given that a police investigation was underway, that I or any cabinet minister should have shared with others who were named in the report, even though there was no reason to suspect wrongdoing.... Nevertheless, it would have been grossly improper, in my judgment, knowing that such an event was unfolding — that is to say, a police investigation of the matter — to have discussed the issue with any individual named in the report.

1 believe that all of us, particularly those with a governmental responsibility, have to weigh very seriously and cautiously how we handle matters of this import. We have two obligations, in my view: to protect the reputation of innocents who might be involved or named in a report; and secondly, of course, the obligation of protecting the freedoms and options available to the statutorily appointed individuals, in this case the police themselves, I had studiously avoided making mention of the police investigation because I realized the sensitivities. There are two different groups whose options have to be protected here. With the police themselves announcing that this had unfolded, it seemed to me quite appropriate that I repeat it here in the House.

In summary, Mr. Speaker, we had a police investigation that was unfolding which did potentially involve the reputations of others, which did result in the decision by the senior public servant in the province to terminate another public servant, and which unfortunately resulted in a minister of the Crown resigning on a matter of honour — not any suggestion of guilt, not any suggestion of responsibility, but purely honour.

Now in this case....

MR. SPEAKER: Order, please. Answers to questions that are put in question period must be brief and to the point. While this particular answer seems to have captivated everyone's attention, we're still violating the rules of question period. If the minister wishes to make a ministerial statement about it, perhaps another time would be more appropriate. But I would ask the next member standing to have a brief question, and perhaps a brief answer, because question period is not that long.

MR. CLARK: Can the minister inform the House when he became aware of the comptroller-general's report and when he became aware of the RCMP investigation?

HON. MR. COUVELIER: I didn't come with any diary, so I'll take that question on notice.

MR. SPEAKER: The question is taken on notice. Do you have a new question?

MR. CLARK: A new question, Mr. Speaker, The minister had the comptroller-general's report for one week before the former Minister of Health saw the relevant parts of it, It certainly appears that the Minister of Finance was part of a cover-up. Can the minister explain why it was appropriate to show the former Minister of Health sections of the report on May 30 but not appropriate on May 23?

HON. MR. COUVELIER: The events of last week are all on the record. The member doesn't ask the question because he needs to know the answer; he already knows the answer. The ex-Minister of Health himself requested such a meeting so that he might determine exactly what was being said in the report.

[ Page 10026 ]

It was his decision at that time to request such a meeting, and it was his decision, purely on a point of honour — not because there was any suggestion of guilt or responsibility  — to do the honourable thing and resign last week.

SHORTAGE OF PERFUSIONISTS

MR. PERRY: A question for the Minister of Finance, who many feel has become the real Minister of Health. British Columbia hospitals are currently experiencing shortages of perfusionists, health professionals whose services are critical to open-heart surgery. The government has failed to respond to recommendations made by the Hospital Employees' Union two months ago, which were advanced in an effort to resolve those shortages. Officials at Vancouver General Hospital are now considering privatizing that service to an American private medical company, Psycor. Can the minister explain why he has failed to respond to the submissions from the Hospital Employees' Union; what steps the Ministry of Health has taken to communicate its concerns to him as the minister responsible for hospital finance; and why he is so complacent and smug — I see him smiling now — at a time when patients are dying after...?

MR. SPEAKER: Order! Hon. members, we're starting off a bad week with question period going this way. The questions have to actually be questions, not long statements. That long a statement is going to draw an answer that will certainly see the clock out and may well run into the afternoon's proceedings. I would ask members to consider the question.

HON. MR. COUVELIER: First of all, I have to tell the hon. member that I am not the Minister of Health and have no desire to be. It would take a far wiser person than myself to handle that awesome task, and we have one who does it very well. I am merely a bean-counter who attempts to satisfy the taxpayers' craving for some sense of fiscal responsibility, together with the insatiable spending requests of the socialists opposite. I have no specific knowledge of any initiative by the Hospital Employees' Union, nor should I have. It seems to me that if there is such a proposal in the wings, it would be in the office of the Minister of Health (Hon. J. Jansen), who is fully capable of handling issues of that dimension. So I think the question is misdirected, Mr. Speaker.

MOTOR VEHICLE INSPECTION

MR. LOVICK: Mr. Speaker, my question is directed to the Solicitor-General. I have to pause there to see if he will turn. Yes, he is awake.

In the Kamloops inquest your director of inspection and carrier safety testified that a Kamloops spot safety inspection rejected half of the trucks stopped Further, one in five trucks was ruled unfit to operate and was pulled off the road. The question is this: has the minister now decided to get tough — as he claims to be a tough guy — with the 365,000 trucks passing through Kamloops annually and establish a permanent inspection facility in or near the city?

HON. MR. FRASER: Mr. Speaker, that's a question of future policy.

QUINTETTE COAL-MINE

MS. EDWARDS: My question is to the Minister of Labour. The Quintette coal-mine in northeastern B.C., through a recent arbitration panel decision, remains in a state of fragile stability. The decision only covers the next ten months, and world coal prices are well below the level needed to sustain Quintette. In the case of possible significant layoffs at Quintette, what steps has the minister decided to take to ensure that Quintette workers, unlike the Sullivan mine workers before them, are given more than two weeks' notice of imminent layoff?

[2:30]

HON. MR. JACOBSEN: I just informed the member that where there are large numbers of employees, the question of adequate notice for employees affected by layoffs is a concern of my ministry. We are looking at that issue. I can't comment further on it, but we are reviewing it and may be dealing with it in the future.

MS. EDWARDS: The federal and provincial governments put $1.5 billion of taxpayers' money into this development, and 1,500 jobs are at stake. What specific contingency plans does the government have in place to cope with the impact on the community of a possible bankruptcy or closure?

HON. MR. JACOBSEN: Mr. Speaker, that question is not one that I think should be directed to my ministry. I think you would have to direct it to someone else.

BUSINESS DEVELOPMENT CENTRES

MS. CULL: My question is to the Minister of Advanced Education. On Saturday, the Times-Colonist reported that the business development centre at Camosun College is to be closed. Can the minister tell us how many of these business development centres he has decided to close, and what the reason is for closing them?

HON. MR. STRACHAN: It's a good question. Actually, the matter is now under advisement within the ministry. We've been reviewing it for some time, wondering if we are getting maximum utilization for the dollars spent. I can't give the member an exact answer in terms of how many at this point, but I can tell you that it's under review. As we decide to proceed, the notices of closure will be forthcoming.

[ Page 10027 ]

HELPLINE FOR CHILDREN

MRS. McCARTHY: Mr. Speaker, this question is to the Minister of Social Services. It has been proven by experience that the best way to fight child abuse and child violence is through greater public awareness. For some time now we have stopped the television ads that promote the Helpline for Children, which has been such a successful line and the first in Canada. Early recognition and quick action against the perpetrators, and counsel to the victims, are really the answers to child sexual abuse and child violence. I would like to ask the minister if he would consider renewed and aggressive advertising to promote the use of the Helpline for Children so that more of our citizens will be made aware of its availability in dealing with these various serious incidents.

MR. SPEAKER: This question is also out of order, but the Minister of Labour may wish to respond.

HON. MR. JACOBSEN: Mr. Speaker, as the member said, British Columbia has led the way on the Helpline for Children. It's a very important service to society, and one that I feel very strongly about. Yes, I will review the matter with the ministry to see that we do all we possibly can to make the service available, and to make it known to the community at large that that service exists.

Orders of the Day

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

ESTIMATES: MINISTRY OF
SOCIAL SERVICES AND HOUSING

On vote 59: minister's office, $331,553 (continued)

MRS. BOONE: I want to talk a little bit today and question the minister on something that we touched on Friday a little bit — some heated remarks about staff and what have you. It was intimated by the members opposite that we were attacking the staff of Social Services, and we said that was certainly not what we were doing. There are some very major concerns.

I am sort of drawing things out a little bit so the minister can get his assistants in line there and my colleagues can leave.

I have before me some information written by a former employee of Social Services. He points to a lot of concerns that he has about social services in the region. I am convinced that some of the problems that I've had.... Over the years we've seen a tremendous turnover of staff — as the minister quoted last week, 25 percent in our region, which is region H. It has been a constant problem, with us being unable to maintain our staff and keep them around. Consequently we always have a problem with new people coming on line and those people not necessarily being up to snuff with the policies and being able to handle things. A lot of problems happen as a result of that.

I know, for example, that my office is constantly dealing with Social Services. My assistant, who was previously employed by Social Services and Housing, can usually solve a lot of these problems just by quoting from various policies and stating what is available. But it appears that a lot of times — and I'm not saying that it's because the people are being nasty or mean — the employees are just not aware of the policies and the assistance available, because they are brand-new employees who have been on the job only six months or so. This is creating a lot of problems for us.

The letter that I've got from this previous employee — and I'm not going to mention this person's name, because he or she has asked me not to — voices the complaint that people who come into Social Services are often not told of many resources available to them. It states that this a documented fact. An example is upgrading in trade schools or college; no one these days has to remain with a low-grade education.

Also, as you may be aware, recipients are paid once a month. So when money and groceries run out, no one tells them that they can come in for a food voucher to supplement their income. They are not aware that rent, hydro and telephone can be paid direct to the landlord or business, ensuring that they won't dip into that money, therefore avoiding being evicted or having power shut off. They're often not told that there are allowances for winter clothing and boots, and the letter said that in the Prince George region they were frequently sent out to second-hand stores and told to find clothing and boots elsewhere.

We've found that people are not told that they can appeal; they don't know what appeals are. When they approach our office, we have to tell them that they have the right to appeal and show them how to do that. As I said, I honestly don't believe that it has anything to do with employees doing these things deliberately; often they are brand-new to the jobs and are not aware themselves of a lot of these things. And they find themselves so overworked in many cases that they're making some of these decisions.... However, that doesn't help the recipients. The fact of the matter is that the recipients are not being given the information they require to make their lives better; they are unable to assist themselves in many cases and think that's all that's available to them.

I mentioned to the Minister of Health (Hon. Jansen), for example, that recipients are not made aware that they can apply for subsidies for health premiums. I know this personally from one case I got involved in. A young girl, a single mother on social assistance, had been paying her full premium for well over a year before she realized, when I was talking to her, that she could apply for premium assistance.

I just want to ask the minister what he is doing to alleviate this problem to make sure that new employees.... First of all, we have to make sure that staffing levels out there are increased so employees can assist

[ Page 10028 ]

people properly, that new employees are made available and given time to spend with clients, and that they know the appropriate policies and do everything that they can to prevent the types of problems I have mentioned here.

I think it's a severe problem when an employee takes the time to write me a four- or five-page letter basically saying that as a social worker he was unable to do the job he wanted to do and that he felt troubled that social services recipients were not receiving the type of assistance they should have. What is the minister doing to make sure that this type of problem doesn't continue, to make sure that people are made aware of all the assistance that is available to them?

MR. CHAIRMAN: The second member for Langley seeks leave to make an introduction. Shall leave be granted?

Leave granted.

MR. PETERSON: I appreciate the House giving me this opportunity. In the gallery are 32 grade 6 students from Willoughby Elementary School in Langley, and with them is their teacher, Mrs. K. Ulmer. Will the House please join me in giving them a very warm welcome.

HON. MR. JACOBSEN: Yes, I can appreciate that there can be difficulties at times with new people who perhaps don't have as much experience as we would like to see. We did discuss the fact that for whatever reason, in your area particularly, there has been a high turnover. That's something that perhaps makes it a little more difficult at times. However, the ministry is doing all that it can to try and deal with that problem. We have a recruitment and retention policy with the ministry which shows the activities that the ministry is carrying out in order to increase and enhance its staff.

There are a number of things. I won't go through all of them — there are 80 things listed here — but I would point out the last two. "The ministry has increased its staff training budgets" — which would be important. The final one I think you might find particularly interesting is that the northern university in Prince George will have a social work program starting in September '91 that will hopefully deal with the issue of training people right in that particular area.

In the Prince George area we have a pool of workers which we draw from to try to fill the vacancies as they appear, so that we will have people who have some experience. We have lowered our ratio of supervisors to staff to the point where we now have one supervisor for six members of staff in that particular area. The final thing is that since 1988 in that particular region we have increased our staff by 6.5 percent for social workers, 8.5 percent for financial assistance workers and 10.5 percent for clerical workers.

Oh, bodies — that's 6.5 bodies.

In addition to that we have these brochures — which I'm sure you are familiar with — that we try to make available to the people so that they will know all of the programs and services that are provided. Nevertheless, I accept that there are times when people do not quite understand it, for whatever reason. But it's something we try our best to prevent happening.

MS. EDWARDS: I would let the minister know that I am going to want some answers to the questions I was asking him on Friday about day care and assessment of unlicensed care. In the interests of efficiency, I thought I would stand up now and let the minister know I will want to ask those questions, and then go back to the member for Prince George North who has some other issues she wants to pursue.

MRS. BOONE: The latest information we have shows the university will not be opening in 1991. We obviously won't be having our program in that university at that time.

Is there anything in the ministry programs? Forgive me for not knowing this, but is there any assistance? There are some professional services in health — physiotherapists, for example — where a $5,000 grant is given to people who will move to some of the northern or outlying areas for a two-year period. Is there any such assistance to try and make sure we get qualified social workers up there?

HON. MR. JACOBSEN: No, there isn't anything quite like that at this time. The ministry has chaired an interministry committee to identify and make recommendations to GPSD to address all ministries' northern staffing concerns, but there isn't anything specific at this point in time.

MRS. BOONE: I would like to suggest, since we are not going to have our university open for at least another two years, that the ministry seriously look at this. I would suggest we have such a massive turnover because conditions are so horrible for people to work in a situation where they are with people who often have no more seniority than they do and are not much more aware of the situation. Therefore the personal gain and sense of doing your job well really doesn't exist when you are constantly in a situation and unable to perform because you don't know what you are doing well.

I would suggest that's part of the problem we have up there; that we do have a real problem in the whole of the northern region, but particularly in region H. There's a constant turnover of staff there, which leads to a real problem with morale. We have to address that, or we're not going to keep people there anyway.

I would suggest that you should be looking seriously at some means to give a primer to people to get them up there. My sense is that when people come up north, if we keep them three years we've got them forever. I think they may freeze in there or something — I don't know. If you can keep somebody in our area for three years, I think they finally begin

[ Page 10029 ]

to understand that there is hope beyond Hope, that lifestyles do change and that we do have a lifestyle that has a lot to offer people. We have to get them up there and into the region first. That seems to be a problem. People seem to want to finish their degrees in the coastal areas here and never want to leave the soggy wetlands of Vancouver and Victoria. Lord knows why  — I wouldn't want to stay here. We have to make sure we can get them up there. Could the minister give me some assurance that he will seriously look at this type of thing and consider trying to do something as a means of encouraging people to go up there until such time as we do have a baccalaureate program?

HON. MR. JACOBSEN: I really think things are better than what the member says. They might be like that at times up there. I do think it's an attractive place, but it may be different, of course, from the lower mainland. But still it has its own charm. Yes, we will look at that and consider the recommendations you make.

[2:45]

MS. EDWARDS: I hate to let that go past without saying that I, with the member for Prince George North, can't understand why people don't like to come into the interior in greater numbers than they already do. They just don't know what they're missing half the time.

Interjection.

MS. EDWARDS: However, to the Solicitor-General (Hon. Mr. Fraser), there's a glitch somewhere.

Anyway, Mr. Chairman, I still want to pursue the questions I was trying to get answers to on Friday, which involve a program that the ministry announced back in December of '89 to encourage non-profit agencies to recruit, train and support family day care providers in British Columbia. But when the contracts get down to recruiting, training and supporting, it seems the contracts involve a considerable amount of assessment. In what is required under the contract that I have with the Women's Centre in Cranbrook, there is an indication that the person who will be hired by a non-profit agency will not only assess each caregiver, but will also assess each unlicensed day care facility.

I assume, Mr. Minister, that you are not going to be able to answer these questions until you have another resource person with you, as was the case on Friday, which is why I didn't get these questions answered on Friday. I am pretty well repeating the question I was asking you on Friday.

I'm hoping that this is the pacing mechanism that allows this person to come and tell me why you would have somebody hired on an ad hoc, year-to-year contract to assess unlicensed day care facilities to ensure — and I'll quote — "that the environment in the facility is conducive to quality care." The contractor — that is, the non-profit society — will, together with the Social Services and Housing staff, develop a tool to accomplish whatever is required by the contractor's assessment to ensure that the environment is conducive to quality care.

There are a great many assumptions in there, Mr. Minister. There are a whole lot of things there about unlicensed day care; it is generally unlicensed, I guess. The reason people get licences is partly that people who can get licences are able to meet assessment requirements. There are assessment requirements for unlicensed care, and I am curious to know what level of assessment is going to be done and what kinds of standards and criteria are going to be set up. How uniform is this going to be across the province? How stringent is it going to be? I have various questions of that nature.

HON. MR. JACOBSEN: Mr. Chairman, we made a note of the questions the member asked last Friday. We have the answers here, and I'll go through them. Perhaps it will answer all of the questions you have. If it doesn't, you could ask the additional ones.

The member for Kootenay referred to the terms of the agreement in Cranbrook and asked about the difference between a registry and a directory. The term most frequently used by the ministry is "registry," but sometimes, as in the Cranbrook agreement, "directory" is used. In the context of the day care support program, the two terms mean the same thing. I think that was one of the questions you had.

Registries of available day care services are designed to help parents locate day care which best meets their needs and the needs of their children. The information contained in the registries is readily available.

Guidelines for assessment have been developed, which include a range of suggested activities such as personal interviews, references and home visits. Assessments of both day care facilities and service providers vary from area to area, depending upon the many different characteristics of each community.

The most important and primary assessors of service must always be the parents themselves. The ministry, throughout its day care support agreements with non-profit agencies, augments parent assessment with assessment done by the agencies. Agencies are expected to exercise professional judgment in determining how and what to assess.

With respect to training, there is no requirement that care providers in the informal sectors — family day care — have training. However, training packages have been developed which are offered at community colleges. This training is not to be confused with the early childhood education course offered by the community colleges. Staff in licensed group day care centres are required to take this training, which is an entirely separate curriculum from the family care course which has been developed.

MS. EDWARDS: Mr. Chairman, I'm still puzzled. If it's unlicensed, it indicates that there is obviously going to be quite a range of care available as well as criteria. That certainly seems to be the case.

[ Page 10030 ]

From what the minister has said, the criteria will vary from area to area, so obviously it depends largely on the professionalism of the contractor. It depends on the area, the parents, etc. I'm just not sure in the end what the assessment is for.

HON. MR. JACOBSEN: The assessment is there to help parents choose the kind of day care they require or wish to have. I guess that's really the purpose. It also covers establishing the training needs within the community.

MS. EDWARDS: What I see, Mr. Minister, is obviously a single person with a budget of $45,000. You're not talking about more than one person, I have to guess. This person is supposed to carry out a function that for a licensed day care is carried out by people with specific professional expertise. Besides doing the assessment, this person also assesses what the training needs are going to be for, these people and the design of the training.

What I am really trying to get at is that if this one person is supposed to do this whole range of extremely professional things, why is the ministry putting it out to contract to non-profit groups which are then given a wide degree of latitude to meet whatever criteria they have?

I don't for a minute want to say to the minister that community groups don't have a right to say what goes on in their community — I want to start from that point. But I find a real difficulty with why the ministry now wants to do some kind of registration of people and assessment of them and then make an attempt to give them training, all in the person of a single expert, if you like, who can be hired by a community organization. Then you say that the assessment will depend on the professional judgment of that group. Who decides? Is there any question by the ministry about the professional competence of a group to make a professional judgment in this area?

HON. MR. JACOBSEN: The registry is there, firstly, to determine who would like to perform that service within the community and, secondly, for parents who may want the service. As far as control is concerned, yes, we will monitor to make sure it's adequate service. The registry is really there to bring the parties together, to find out who wants to provide service and who requires the service.

MS. EDWARDS: Is the minister hoping for unlicensed day care to get closer to the requirements and criteria of licensed day care?

HON. MR. JACOBSEN: No, we're not. Informal day care is out there, and it's a choice for parents. We are not directing that they must go a certain way.

MS. EDWARDS: Has the ministry discussed with the Ministry of Advanced Education and Job Training the difficulties you've had in seeing that training is provided, and have you suggested that some more diversified training might be provided through community colleges?

HON. MR. JACOBSEN: Yes, we have had those discussions, but they apply more to the licensed day care than to the unlicensed.

[3:00]

MS. EDWARDS: Some people see the whole business of training — as defined here — as very basic level training. In other words, It's almost consciousness-raising in the development of self-esteem and basic life skills training and so on. These courses are provided on a regular basis by such voluntary agencies as women's resource centres. If they are providing the type and level of training that the ministry sees being involved in these contracts, it takes a degree of trust and a willingness to depend on the other group to take your interests into consideration.

If a person is trying to develop that trust and is also attempting to assess that person's ability to make a livelihood — because it may be a livelihood for that person — and if they have to do the assessing, which is the decision of whether they are able to make their livelihood, and they have to make that decision before they even do the directory.... As you can see, these things are all tied in. I am curious to know how the ministry sees those functions all being performed in the same place. Or are we simply working at a level of  "let's pat you on the back and make you feel good"?

HON. MR. JACOBSEN: No, we're not working on the pat-you-on-the-back thing, although I would like to commend some of the people who provide the service and, in fact, do pat them on the back. I think they provide a very good service.

But you know, when we talk about unlicensed day care, we're talking about two children or less, and I think there are a lot of people who are qualified to do a good job of providing that service. You talk about trust. I would assume that trust is a very big part of it. Certainly I would feel that way, and I think most parents would feel that way.

As far as training people in order for them to care for two children, I think there are a lot of people who know how to do that as well as anybody we might send there to train. So I really think that training for that type of day care.... Apparently, I'm told, it's a very appealing kind of day care. Many parents like unlicensed day care with the small number of children and the very personal attention.

MS. EDWARDS: Mr. Minister, I'm a veteran of the child care wars. I have had occasion to employ day care people in licensed facilities and in group places — everyone from high-school teenagers to grandmothers from down the road. I agree with you that some of the best day care we have is given by friendly people who share some of your values. However, to me, that's not what we're talking.... I'm not sure that the minister isn't trying to turn this into something else. Because of the way things are in this

[ Page 10031 ]

day and age, we have women who choose to stay home with their own children — they sometimes have to — and to be able to do so, they care for a number of children. You suggest that there are less than two all the time, and maybe that's so, according to the rules. Is it the case that if you get more than two children, you have to be licensed? Let me clarify that first.

HON. MR. JACOBSEN: Yes, to be an unlicensed day care, it's two or less children. I hope, as a result of me saying that, that somebody who, out of the goodness of their heart, is providing care for an extra child — or maybe two — on a temporary basis will not face some difficulty. But the rule is that it's for two or less.

MS. EDWARDS: I see a whole lot of activity going on here around an unlicensed situation, and I'm not sure what the goal of the ministry is. I know that there are people in our community who need the kind of day care that is not currently available. They need day care for people who work shifts; that's the major need. And they need some other things. But the directory may or may not deal with that.

I think you're setting up a situation where one person may be required to do for unlicensed day care what is done by very well qualified experts who presumably.... I believe that's what the ministry believes for licensed day care. We're expecting them to do this. Perhaps you can find very qualified experts. But if they're experts in assessment, are they also experts in setting up training programs? Are they experts in doing everything that's required in this program? That's my question, Mr. Minister. I still feel somewhat uneasy about what exactly the goals are with this program.

HON. MR. JACOBSEN: Well, the goals are to provide or make possible the best service that we can make available to the public. One of the advantages of the unlicensed day care that you are obviously concerned about is that it tends to be flexible and sometimes convenient for people requiring the service. We're looking to improve the quality, the availability and the support for this kind of system. We certainly are not intending to rule out or impede in any way the opportunity for people who want to provide this unlicensed day care with a small number of children.

I think we can all appreciate that if you're operating a licensed day care with a large number of children, that's a different kind of undertaking than having a couple of children to look after. Therefore the training requirements must also be different. What we're trying to do here is a practical approach to a problem and to make it as good, as convenient and as satisfactory as possible for the public.

MR. PERRY: I'd like to come back to some issues of housing that I didn't have the opportunity to raise one or two weeks ago when the former minister was here. I realize that the new minister can hardly be expected to be intimately familiar with all the details of provincewide housing needs. But I recognize that he's a sincere and thoughtful man, and I'd like to explore some of his philosophical perceptions of the issues.

I want to begin by citing from questions I raised in the waning hours of the Legislature last year on July 19 when I asked the then Minister of Housing, Mr. Richmond, how he felt about the demolition of apartment buildings which were in good physical condition and whose inhabitants regarded those buildings as their homes.

I would like to read, for the minister's interest, briefly from a letter I read at that time. I won't read the whole letter but simply quote from it. I entered it in the record on July 19, 1989, at page 8780 of Hansard. This is a letter from a woman who lives in Kerrisdale, Mrs. June Black:

"Legalized vandalism best describes what is happening to well-built rental apartments in Kerrisdale these days. Most of the buildings slated for demolition are in beautiful shape and well maintained. They are about half the age of most of the houses in the area. They provide accommodation for many more people than will the replacement condominiums which are only for the very wealthy. Luxury condos generally take up a whole floor. The result is a net loss in available suites.

"Landlords will be tempted to raise rents as the housing supply shrinks. Demolition refugees will search, mostly in vain, to find affordable living spaces. Their homes, reduced to rubble, are being trucked off to landfills — the dollar value, in their building materials and labour, written off. And with no apparent concern that these huge heaps of trash increase our garbage problems.

"Three buildings have been levelled and 12 more are scheduled for destruction. This rape of our resources has got to stop. Our laws don't permit people to deface and vandalize property; those caught are punished. We should not turn a blind eye to the current building demolition binge just because the perpetrators own these premises."

I read again from the record. I'll quote from my remarks: "I'd like to ask the Minister of Social Services and Housing, who really represents the government on this issue, what he feels. This is a government that often talks of Christian morality. Does he think it's morally appropriate to destroy perfectly good rental accommodation?"

Now the record will show, Mr. Speaker, that the minister at the time replied that he found it very difficult to connect — I had gone on to make a further point — starvation in Third World countries and Christian morality to the demolishing of buildings in Vancouver. The point I was trying to make at the time was that I found it immoral and unethical to demolish a perfectly good building in which people have lived for as long as 25 years at a time when there are literally over a billion people in the world who are homeless and there are hundreds of millions who are starving to death. Obviously I was on a different philosophical wavelength from the former minister.

I'm really asking this minister to declare — since he's assumed this new portfolio — where he sees us moving.

[ Page 10032 ]

Having described the situation as it was last year, I want to amplify the comments made by Mrs. Black. The situation has actually worsened, in my view, since that time. Not long ago — in fact, only a few days after that exchange in the Legislature — the first member for Vancouver-Point Grey (Ms. Marzari) and myself were summoned by local residents in the area of Kerrisdale in our riding to attend a protest against a building demolition on West 40th Avenue. When we arrived at that building, we found that inside the building there were refrigerators with their coils intact, with the chlorinated fluorocarbons, or CFCs, inside the coils and that a wrecking ball was about to demolish the entire building.

You, Mr. Speaker, as a former Minister of Environment, will know that this could not have been a good thing to demolish the building intact with the refrigerators in it. Yet when we called this to the attention of the crane operator, he pointed to a pile of a previously demolished building adjacent and to the remains of a crumpled refrigerator and told me that the coil was intact and the CFCs were still inside it and elaborated that in fact one could smell them if they'd come out, so he was sure they were still in there.

I see, Mr. Speaker, that your reaction is similar to mine at the time. We attempted, while still in the building, to call the Ministry of Environment, both provincial and federal, and request that an inspector be sent. All of us were aware that this was a bad thing to do. We found that there was no provision to prevent this happening, and we simply refused to leave the building until something was done. In the end, the supervisor gracefully backed down and arranged for those refrigerators to be carted out of the building by hand.

I should point out that the first member for Vancouver-Point Grey risked her personal safety when the crane operator attacked the building with his wrecking ball while we were in it and ran his machine across her path as she tried to enter the building. I think it's difficult for members from more rural ridings than Vancouver to understand the gravity of what has actually been happening in that neighbourhood.

[3:15]

Let me give you another example of how this affects people. In a building called Quilchena Lodge on West 38th Avenue in Vancouver are a couple of elderly sisters, aged 93 and 95, if I recall correctly, the 95-year-old was widowed at the Battle of Ypres in World War I. The 93-year-old never married, and both of them have lived in that building since January 1963, in an apartment that is an aesthetic delight. It has beautiful paintings on the walls and is a comfortable home for these two very elderly women.

That building is now scheduled for demolition. There's no question in my mind, as a physician, nor in the minds of gerontologists I have spoken to, that the forced expulsion of women of that age and of some in their late eighties who also inhabit the building will have detrimental consequences on their health. These women are not invalids. They walk three blocks to West 41st Avenue to do their shopping. They take a taxicab to visit their doctor nearby. This is their home, and yet they are going to be driven out purely so that a building in good physical condition can be demolished.

I think that the residents of Vancouver, from whatever political persuasion — including long-time supporters of my party, the Liberal Party, the Social Credit Party and undoubtedly other parties, including the Conservatives — are revolted by this situation. They find it morally repugnant. Senior members of the churches, such as the former moderator of the United Church, the Very Reverend Robert Smith, visited that building and the apartments of those elderly women and shared the ethical revulsion that I feel at a disgrace like this.

The city has found itself unable or unwilling to deal with this. In the waning hours of this debate, I would simply like to ask the minister where he stands. Does he think this is a good thing to happen in our society or not?

HON. MR. JACOBSEN: The member asked for my own philosophical views on the matter, and I guess that's fair enough. To start with, I think that we should not lay the responsibility of the demolition of those buildings at the feet of the provincial government. It is the prerogative of the city and the municipality to control that sort of thing if they wish to do so.

The city of Vancouver has taken some action but not as much as some other communities have. The argument has been made that in order to continue the redevelopment of the city, they have to remove older buildings to make room for new ones. I suppose there's some validity in that argument.

If you want my philosophical concern about it, the problem as I see it, at this particular time when there is a very severe shortage of rental accommodation.... We've heard a lot today about what we might do to alleviate the problem of rental supply or to deal with the problem that people face with renting. We had some solutions proposed here earlier this day. But those solutions did not deal with the essential problem of supply. The question you brought up does deal with that. I've heard the argument that the buildings taken down are replaced by larger ones that in fact accommodate more people. There is one problem, however: the buildings that come down are affordable; the ones that go up are not affordable to a fairly significant sector of society. The concern is: how are those people housed?

I want to tell you that my philosophical view is that I have a great deal of concern about that happening at a time like this. But the control lies within the hands of the city or municipality; they are the ones that should exercise it. After all, they are responsible for the development of their communities.

On the issue you mentioned about the building being knocked down with the refrigerators inside, I think it would be the responsibility of the inspectors

[ Page 10033 ]

who gave the permit to demolish the building to see that it was carried out properly. I don't think it's really a problem. Although it's a concern of this ministry and the province, it is not within the control of the province.

MR. PERRY: In comparison to the answer I received last year, we've made some progress. At least I see some sensitivity to the issue. Not to be argumentative, but for the new minister assuming these responsibilities, I will point out that in the case of the demolitions in my riding — particularly in Kerrisdale but also elsewhere — I believe it is universally true that buildings demolished have been replaced by larger buildings that accommodate fewer people.

In the case of the Quilchena apartment that I described, although the developer has been relatively innovative in attempting to accommodate the elderly tenants, the net effect will be to replace 65 rental units with 25 to 30 rental units if that demolition proceeds.

In the seven minutes remaining to me, let me raise a few issues very briefly. Could I ask the minister whether he is prepared to give an indication whether the government will bring forward the amendments to the Vancouver charter, requested by the city, in this session so that the city will have increased authority to deal with the adverse social consequences of demolitions?

Two of the important amendments requested would give the city the power to regulate the destruction of trees larger than eight inches in diameter on private property and to levy development fees which can be applied against the substantial proceeds of redevelopment towards provision of social services and facilities in the community that make up for some of the negative impacts of demolition.

Can the minister assure us that those amendments will be brought forward this session for approval?

HON. MR. JACOBSEN: I'm not prepared to assure the member of that, because to do that would be the same as to announce the legislation. As I'm sure the member realizes, future legislation is not something that we would discuss in detail during the estimates.

But I would say that through my other ministry I've been part of discussions with the city. We know some of the concerns they have, and we listened very closely to them. We'll just have to wait and see what kind of responses we have to the requests of the city.

MR. PERRY: Mr. Chairman, another brief question. Will the minister give us any assessment of the current status of the Jericho lands in Vancouver? As he knows, there is intense community speculation over the future of those lands.

With the knowledge that the Jericho Hill School will be moving, there's great concern in the community as to whether the land will be sold to a private developer, as was the case in the Expo lands or the Westwood plateau, or whether the land will be retained in public hands for potential long-term leasehold development, as was the case in the south shore of False Creek.

There's also great concern about what form any future development might take. I would seek some reassurance that the government will undergo a public process. This is a question we've asked many times in this House. We have yet to receive a reassuring answer.

HON. MR. JACOBSEN: I have to, first of all, say that the use of those lands are within another ministry. So I can't really speak for that ministry.

But I would point out that we, in this ministry, have made sure that all ministries — that includes the ministry responsible here — are aware of our concerns about the need for housing accommodations, particularly affordable housing or rental accommodations, within the city of Vancouver. They certainly know our concerns on that.

MR. PERRY: Mr. Chairman, one other quick question. The Department of National Defence, in concert with the federal Department of Housing, has recently announced plans for the redevelopment of veterans' projects along Fourth Avenue and along Broadway in my constituency.

As the Chairman may be aware, these are projects occupied largely by World War II veterans, who occupied the buildings on the legitimate understanding that as veterans — usually of combat in World War II — they were entitled to certain considerations from the public for their sacrifice in the national interest. They have enjoyed apartments at reasonable rents, which have afforded them a good standard of living in that area.

Many of the tenants are concerned now that the redevelopment may proceed and quite radically reduce the amount of living space available to them, even if it increases the number of people who may live on that site — a very worthwhile idea, in my view.

What I'm seeking from the minister is some indication of what the role of the provincial government is in that project, and whether he will insist that the public consultation process genuinely take account of the veterans' legitimate concerns, particularly considering that many people of my generation are not fully aware of the sacrifice these people made, both men and women, during the war and that they are a rather vulnerable minority now, as war veterans who can't count on the automatic understanding of the public that they would have had closer to the time of their military service.

HON. MR. JACOBSEN: Mr. Chairman, we have had meetings with the federal minister on that. There's been talk, I understand, about doing a display project, if you like, to try and do something innovative. There has been no response on that officially; no agreement has been made. They are aware of our concern about the possibility of some social housing, and the federal government now has a project man-

[ Page 10034 ]

ager dealing with that project. We are in consultation with them on this.

MR. PERRY: I wonder if I could ask the minister whether he would be willing to commit himself to meeting with a committee of the veterans living in those projects if they wish to meet with him.

HON. MR. JACOBSEN: I am a little bit reluctant to say yes to that. The reason for that is that the federal government is involved, and it may or may not be appropriate. Just to say yes or no here to that question is something that I wouldn't like to do. However, I can assure the member that it might happen. Failing that, I would assure him that people from the ministry will certainly be keeping in touch with those people and making sure that all of the concerns they have are considered when the decision is made.

MR. PERRY: The clock gives me time for one final brief question. This morning I was made aware of difficulties experienced by the so-called triage facility on Main Street in Vancouver. It is a facility run by the St. James Church community services for indigent people and the chronic mentally ill as one of the places of last resort for street people, who mostly have chronic mental illness. The development pressures in that neighbourhood from the Concord Pacific and Bosa redevelopments adjacent are putting tremendous pressure on that facility, which serves about 50 to 100 people and actually provides their housing needs. It is now operating on a month-to-month lease.

[3:30]

I would simply like to ask whether the minister is aware of this situation. If he's not, I'd be delighted to pass on to him some documents I received this morning, because this is becoming an increasingly critical housing problem for the chronically mentally ill in the city of Vancouver.

HON. MR. JACOBSEN: We certainly are aware of the project you are talking about. We are not aware of all of the details, and we welcome your passing on anything that you have. If you offered to pass something on to us, we would certainly be prepared to receive it.

Vote 59: minister's office, $331,553 — approved.

Vote 60: ministry operations, $1,673,675,447 — approved.

HON. MR. BRUMMET: Mr. Chairman, I believe it's time to move that the committee rise, report resolutions and ask leave to sit again.

The House resumed; Mr. Speaker in the chair.

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

HON. MR. BRUMMET: Second reading of Bill 14, Mr. Speaker.

HOME OWNER GRANT
AMENDMENT ACT, 1990

HON. MR. COUVELIER: Mr. Speaker, this bill will achieve three objectives: it continues into 1990 and subsequent years the basic homeowner grant at assistance levels that were increased in 1989; it will introduce a supplementary grant for homeowners who have school taxes in excess of the basic grant; and it will create a statutory appropriation to cover some homeowner grant program costs. These changes are part of the government's response to the concerns raised by homeowners about high and rising residential tax rates.

In addition to the homeowner grant enhancements, the government has responded in three related ways. Firstly, it has made residential school property taxes a provincial revenue, so that the province now directly controls school tax rates. Secondly, it has significantly increased funding to public schools from other revenue sources. Thirdly, it has required school boards to hold referenda to approve spending in excess of their allocation of the provincial education spending block.

As a result, residential school property tax rates will increase by only 4 percent on average across school districts. Without these changes, 1990 gross residential school property taxes would, on average, have risen in the order of 20 percent. Revenue from net residential school taxes will equal only 10 percent of public school costs in 1990-91. Instead, as a result of increased funding for education from sources other than residential property taxes and a higher level of homeowner grant relief in 1990, the majority of homeowners will see their net school taxes fall from the 1989 levels, and many of the remainder will experience only marginal net school tax increases.

MR. SPEAKER: Order, please. Perhaps I could ask those members who wish to participate in the debate to wait until they're recognized before beginning to speak, or if they wish to speak on something other than the debate, to do so elsewhere.

HON. MR. COUVELIER: For 1990, the supplemental homeowner grant provided in this bill will equal 25 percent of residential school taxes in excess of the maximum basic grant. For 1991 and subsequent years, this supplement will equal 50 percent of this excess amount. In the interest of fairness, neither the basic homeowner grant nor the supplement will be applicable to referendum taxes. Homeowners should not be sheltered from the impact of their decisions on referendum taxes by being provided an additional homeowner grant, leaving owners of residential property not eligible for the homeowner grant to pay the full referendum tax.

The supplement is being introduced to ease the burden of taxes on homeowners and to address a residential school property tax distribution problem.

[ Page 10035 ]

Under the current system, for example, a homeowner who receives a tax notice for $500 of gross school taxes would likely pay $70, while a homeowner who receives a tax notice for $1,000 of gross school taxes would pay $570, more than eight times as much.

The beneficiaries of the supplement represent a broad range of lifestyles and income levels. I was reminded during the property tax forums held throughout the province last year that high property tax bills are not necessarily an indicator of high-valued homes or ability to pay. I found, for example, that many homeowners in the interior who have been paying high school taxes have modestly-priced homes by lower mainland standards and that many lower mainland homeowners are house-rich but income-poor.

Over half a million households will receive the supplement. The supplement will result in reduced net school taxes from 1989 levels for over 400,000 of them.

The maximum available benefit from the supplement will be capped at $1,000. This will affect fewer than 1,000 households.

The 1990 cost to the province of the supplement will be almost $50 million. In 1991 this cost will rise to slightly more than $100 million. After this homeowner grant increase, net revenues from residential school property taxes will be close to $300 million in fiscal '90-91, down sharply from fiscal '89-90.

Following the property tax forums of last year, the government examined the option of entirely removing residential school property taxes. However, this approach was rejected for several reasons. Not only would it have been too expensive; it would also have put B.C.'s tax system significantly out of step with other jurisdictions. All other provinces either levy a residential property tax themselves or give this authority to school boards. In addition, it would have required the replacement of residential school taxes by other taxes. This would likely have had the effect of shifting some of the burden of taxes from non-resident property owners to B.C. residents.

This bill also creates a statutory appropriation for the payment of homeowner grants to municipalities and individual homeowners. Although most of the cost to the province of the homeowner grant program will take the form of deductions by municipalities from their remittance of school taxes to the province, there will still be cases where the province will need to reimburse individuals or municipalities directly; for these cases the statutory appropriation is required.

In conclusion, we are proposing to continue the 1989 homeowner grant benefits in 1990 and subsequent years, and to introduce a homeowner grant supplement, thus creating a more balanced distribution of the tax burden. These and other measures that I have mentioned affirm the government's commitment to supporting and encouraging home ownership and should alleviate the concerns of homeowners about high and rising school tax rates. I move the bill now be read a second time.

MS. A. HAGEN: As the Minister of Finance notes, this bill is part of a number of initiatives of his government around education taxes and funding. In my comments this afternoon, I want to range fairly broadly over those issues, as the minister has done in his.

First of all, I'd like to note that we are, of course, supportive of initiatives that produce fairer taxes for people, and particularly of changes in taxes that may be regressive, as we have known the homeowner tax for school purposes has been for quite a number of years. I think it should be stated at the outset that the reason for that unfairness rests very clearly on the shoulders of this government, which has pretended for many years that it has indeed been dealing on a fair basis with the homeowners of the province in respect to school taxes, while it has consistently pushed more and more of the costs of operating our schools onto the homeowner. Fortunately this year there are some changes that shift some of that balance. Insofar as that shift occurs, we welcome the change.

But I would note right off the bat that as is so often the case, the government tends to exaggerate the extent of the relief that is available. If we go back to budget day — the minister's day in this House, when he has the opportunity to present to the people of the province his plans for the budget for the next year and the effects it is going to have on people's pocketbooks and services — in the text of his speech the example the minister used was that there would be a $250 tax reduction for people who are not seniors as a result of the bill that we are now debating; and that there would be a $182 tax deduction for seniors. I want to note that that example applies to very few citizens of British Columbia. It may involve those people whose homes are in the 80 or 90 percent group as far as the cost of their homes and the assessment is concerned.

[3:45]

If we go back to some of the tables at the back of the book — not something that was ever said in this House; not something ever recorded in Hansard — a truer story emerges. On page 61 of the 1990 budget book, the average tax benefit is noted for 1990 and 1991. In this case we're looking at an average tax benefit of $40 — a far cry from the $250 that the minister touted on budget day, April 19, in his budget speech

Furthermore, the minister noted that a very significant number of households would benefit. We certainly have indications that the minister's claims are considerably exaggerated in that regard. One-third of the districts of B.C. — 23 — will receive no benefits at all; none of the residents of those school districts will see any improvements as a result of this legislation, which brings me to the point where I think it's fair to say, Mr. Speaker, that this legislation is structured to provide tax relief to those who live in large houses and who pay high taxes. Those who pay the most taxes are favoured most. And it's true that among some of those people are those who are, to use the minister's words, house-rich and cash-poor. But by

[ Page 10036 ]

and large, all who have looked at this legislation and all who have examined who it will benefit note that it does benefit those people who are more likely to be the friends of Social Credit, those people whose incomes enable them to pay a better share of the cost of education. Where it benefits those who are houserich and cash-poor, we are thankful and grateful, but there are many people who are neither house-rich nor cash-rich who will not be receiving benefits from this particular legislation.

This bill is a part, as the minister has noted, of a broad range of changes that have occurred in education finance. I've had a number of discussions with citizens around the province who have been paying very close attention to the changes that the government has brought forward; they are not only not seeing any significant changes in their taxes but they are recognizing that the government has done a good deal to disarm them from information that enables them to make good local decisions about education.

For example, the minister notes a referendum system that was introduced this year. It requires that for any local school board decision on operating costs that exceed what the government states is the amount of money that will be available for school districts to run their school programs and their school system, the school district must go to referendum, but it must go to referendum with only a part of the information that citizens need to have in order to make informed decisions. It must go to referendum without having information about the amount of tax that will be charged by provincial government decision against homeowners for that district's share of local taxes. That means that residents in school districts are being asked to make decisions without knowing the implications for their taxes.

The reason for that is twofold. The principal reason is that the government is not making available to school districts the proportion of the costs of the block funding for that district that will come from local taxes. I know the Minister of Education (Hon. Mr. Brummet) has made a great thing about the fact that people should be making these decisions on educational grounds alone, but that is a very specious argument, Mr. Speaker. We know that school boards make decisions about what the programs are going to be in their district on the basis of the educational needs of the district, on their priorities, and on the cost of those programs to their local taxpayers. All of those factors are taken into account for responsible decision-making. We are asking homeowners to make decisions on referenda with only a part of the information available. They do not know when they make a decision on a referendum what the tax implication will be, nor does their school board know what the tax implication will be.

Let's look at a very germane example of that situation, one I've heard a good deal about from citizens who are very angry because the government did not provide their school boards with the information to enable them to make an informed decision.

The Coquitlam School District recently held a referendum. I believe the amount was for something in the order of $4 million for that referendum. And with the information that they had available at that time, they calculated that the cost on an average household for that referendum would be around $150. However, when that board learned the amount of money that would be available to it under its share of the block to its district, money that would be coming from its local taxpayers and money that would be coming from the province, there was an entirely different picture. The cost to the average taxpayer in Coquitlam was calculated, and after that district had all the information about the tax implications of these changes, the tax implication of the referendum would have been $9. You can imagine the difference that that makes in terms of people making decisions.

Decisions are made on the basis of the educational program being offered, and they certainly are made on the basis of the taxes that will be charged. I would expect, Mr. Speaker, that that kind of situation will occur over and over again with this government's system of trying to hobble taxpayers into making good decisions about education.

We could come back to the whole issue of referendum, and note again that that decision, that bill we dealt with, Bill 11, earlier in this session to require referendum is a decision that is going to haunt us in terms of good educational decision-making at the local level for all of the time that it exists. Coquitlam is an example of the hobbling that occurs because this government does not want citizens to be armed with all the information they need in order to make careful decisions in respect to the educational priorities of their district.

Let me come back again to the question of this bill, how it has been promoted and what it actually does for citizens. I would like to use the example of my own district, which is in the lower mainland. It is a district that has seen very significant increases in the value of homes in my city of New Westminster, which has a very large number of older people, many of whom still live in their own homes. We got our tax notices this morning, I would note that in my home in New Westminster this legislation gives me what I would call a very modest tax saving of $35.27. The $250 benefit that was promoted by the minister on budget day, translated for a modest lower mainland home — my home is fairly average in the community — produces that kind of saving.

People in my riding who have not benefited even by that modest saving are the seniors in my community. I have looked again at homes that fit into the modest to slightly more expensive, and I find that older citizens are not seeing any savings at all out of this much-touted legislation. They are seeing tax increases of up to about 5 percent of their bill last year. It all goes to point out that, although this bill does provide some relief for some citizens, those who are going to benefit now and even more so with the benefits proposed for next year are the more affluent people in our society — those who have benefited from an education, who will benefit from the education our children receive and who have the means to

[ Page 10037 ]

provide for a more significant share of the cost of educating our children.

[Mr. De Jong in the chair.]

Throughout this whole change process, we have a government that is desperately trying to make some recompense for its folly and its failures over the past ten years in the funding of education — a government which, as I noted at the start of my remarks, has consistently shifted the cost onto local taxpayers instead of paying its fair share and is now trying to make some adjustments to improve that cost-sharing. It has finally got to the point where it is accepting the McMath formula of sharing: 90 percent of the dollars for education coming from the province and 10 percent from homeowners. It has been seven years coming to that more fair perspective, and I would note that it only came to that perspective after we proposed it as policy and passed it as policy in our March convention of the New Democratic Party held in Vancouver. In fact, as I've noted earlier in this House, the Premier was ranting about the earlier sharing ratio as the most wonderful thing in the world at 83 percent of the funding coming from the province, just the day before the budget was tabled.

Finally, I would like to note that one thing that is a subtle part of this reform — these changes which we have not had an opportunity to debate as a package, which we're debating piecemeal through the budget debate and through debate on the school finance arrangements and now through this homeowner grant — is that this government has indeed taken over the financial decision-making for school districts. I would suggest that there is a very fundamental shift here in something that we hold as very valuable: the way we look at how our education system will be funded. We know that the province has a significant responsibility — constitutionally, historically and practically — for how our schools are run, what programs there are and what funds are available. But implicit in all the historical working relationships between government and local school boards is the right of each of those bodies to make decisions around financial matters and to be accountable and responsible for those decisions.

This legislation today is the final piece of legislation in the package that takes away from boards the right to make financial decisions on behalf of their school districts. Mr. Speaker, I predict that the change will not be good for the long-term health of education.

Education is still a bargain in British Columbia in terms of what we as taxpayers pay. It's a bargain for most of us as homeowners. It's a bargain for us, in terms of the proportion of our provincial budget that goes into education. It's a bargain in terms of this activity being one of the most important tasks that we undertake as government on behalf of our children, the future of our economy and the social well-being of our body politic.

By shifting, as this government has done, the responsibility for that decision-making onto the provincial government by removing from local decision-making bodies — namely, the school boards — the right to be involved and accountable for some of the financial decisions, I think this government is taking us on a path which most citizens believe is not in the best interests of education.

Although changes that provide modest improvements in the cost of education to local taxpayers are a part of that package, in the long run they are really minuscule, in terms of any genuine financial benefits for most of the taxpayers of the province. There are many who will see no benefit — in fact, some increase — and in the long run, the overall package will be a disservice to how we manage, fund and make decisions both provincially and locally.

Mr. Speaker, we will be supporting this bill, but we will be supporting it with the knowledge that it is a part of a package that has aspects that we believe are bad and wrong for British Columbia. We will be looking very closely over the next year at some of the outcomes of these decisions in respect to boards' ability to manage their systems in ways that are consistent with the responsibilities they should have in our longstanding practice in the province.

Mr. Speaker, the legislation is very straightforward and requires very little discussion when we get into committee. Other colleagues of mine will be speaking to some of these issues as they affect the taxpayers in their communities and to the broader issues of the changes that this government has brought forward and the effects of those changes.

MS. CULL: Mr. Speaker, I ask leave to make an introduction.

Leave granted.

MS. CULL: Mr. Speaker, in the gallery today we have some Scouts from the 5th Garry Oak Scout Troop in Oak Bay, along with their teacher Mr. Williams. I ask the members in the House to make them welcome.

[4:00]

HON. MR. BRUMMET: Mr. Speaker, I want to make a few comments on this bill, because I think it does provide significant tax relief to the taxpayers of this province. I can't quite accept the arguments made by the member for New Westminster — the education critic — who makes a great deal of the fact that the government has shifted the cost onto the taxpayers.

It doesn't matter which pocket it comes out of. The taxpayers pay the total bill for education and for government spending. So to focus on that is somewhat surprising.

I know the member now suggests that, contrary to what has actually happened, it was their idea to provide this tax relief. When we made available the information that we were now funding 83 percent of the total education budget from provincial coffers, and that there would be significant tax relief in this coming year, I noticed that the opposition leader then

[ Page 10038 ]

went public with the remarkable and astounding conclusion that if you move from 83 percent to more relief.... So he jumped on the 90 and 10 figure and said, "That is what we would do, " and of course, when it came to the 90 and 10, he said: "See, we did this all together." It doesn't take a great deal of intelligence or imagination to say that we'll go for 90 percent if 83 percent is going to be changed and improved. I guess it's the old story: when something good happens, they say it was their idea.

I notice that the member points out that education is a bargain. When I talked in the past as Education minister about education as a bargain in this province, we had the opposition saying: "The taxes are too high. The taxes are too high." Now, when we have reduced the taxes, the critic says education is a bargain at that price, so I'm not quite sure at what level they want to get involved.

The member criticizes the amount of tax relief based on last year's and this year's taxes. What the member neglects to factor in is what the taxes would have been this year had we done nothing. I asked my ministry to run through the scenario of what would result if we had stayed with last year's system and increased the block by only 6.17 percent and if the supplementary amounts had not been increased — and remember, the initial preliminary budgets were coming in quite a bit higher. If the province stayed at the 75 to 25 sharing ratio and the increase at the district level had been in every district no more than 6.17 percent, then the average increase would have been over 15 percent,

Any other additions in supplementary would have brought that up, and some of our early calculations showed that with no moves, the increase would have been up to almost 30 percent and about 25 percent on average in the province. I can tell you that the scenario goes all the way up to increases well over 30 percent and 36 percent if we had not taken the steps we did.

I want to give the Minister of Finance (Hon. Mr. Couvelier) a great deal of credit for recognizing that because of assessed values, the discrepancies between lower-priced homes and higher-priced homes had grown dramatically and that much of the money from the homeowner grant, which was intended for education funding in the first place, was in some districts not being fully provided to education because of the way the homeowner grant worked. In other districts it fell far short of the total tax.

The member mentioned the Coquitlam example, and maybe the taxpayers in Coquitlam should know that I have asked the ministry to run it at the median, at the 70th percentile, because at the median it incorporates the number of vacant properties and what have you. Over time we found that if you move up to where 70 percent of the assessed values are below the particular figure.... Of course, in Coquitlam the taxes at the 70th percentile went down by $45 with the tax relief measures that this bill incorporates. The member mentioned that in her case it went down about $35, 1 think she said.

What the member neglects to mention is that with no increases in expenditures other than 6.17 percent and no supplementary increases, if we had left the system in place, the taxpayers in the New Westminster example — it was New Westminster she was using as well as Coquitlam — the taxes would have gone up $133; and they have gone down $45 as a result of these measures.

Isn't it interesting that all they use is the $45 figure, not what might have been. All the measures, coupled with this, certainly have provided a great deal of tax relief to the people who were paying the most for school taxes. It moves a bit more equity into the system, and next year, as this bill indicates, when we move to the 50-percent supplemental homeowner grant, it will bring in more equity into the system and will in most cases still leave money left over to pay for municipal taxes for people at the lower assessed levels or lower tax brackets.

I thought it only fair to know — and I might as well use the Coquitlam example — that in Coquitlam, with no increase in expenditures, the taxes would have gone up under the old system something like $53 at the 70th percentile. At the 70th percentile they went down as a result of these measures by $126, so that's roughly $180 more that the people of Coquitlam at that level would have been paying. You can take any level and come up with slightly different figures, but at the 70th percentile the taxpayers saved about $180 this year because of these measures. The example used in the Minister of Finance's budget statement was a correct one at that taxation level, and there are people at that taxation level whose saving would have been $250. So it was not misleading; it was giving that particular example.

I want to make very clear the point that we could make the comparisons of last year's taxes and this year's taxes and come up with perhaps a relatively small savings figure. But if we compare that to what would have been without any changes, I think we'd get a much more dramatic figure. Next year, of course, it will be even more than that.

The member made quite a point that the taxpayers don't know what the referendum tax implications might be, and I have to correct that for the record. It was clear on the ballot form that each of the measures had to be translated into cost per $10,000. Anyone could translate that to what it would mean for a $50,000 home, a $100,000 home or a $150,000 home — or whatever value. That information was to be made absolutely clear on the ballot — and was done. So the members knew what the tax implication would have been for passing a referendum.

As I've said many times, the referendum should be based on needs for extra expenditures and not on the amount of tax room that we create by other measures. I think the people were quite clear in what they were voting for. Next year, with more time available, I think they'll have a great deal more information, where boards will also provide some of the information that they did not provide this year in order to allow those people to make a correct decision.

[ Page 10039 ]

I would like to commend the minister for not just a one-year package but for saying that the homeowner grant, at the level that it was raised to last year, will stay in place, plus a supplementary homeowner grant to make the taxes actually paid for education far more equitable.

With the $700 homeowner grant available to seniors, any of them living in modest homes are certainly not paying any school taxes now. If they are living in more than modest homes, they still get the $700 homeowner grant plus 25 percent of any difference.

[4:15]

1 think this measure is in the best interests of education. The other measures with it are in the best interests of education, because a good education system depends on continuity and predictability. That is what the system now builds in. I want to commend the Minister of Finance for not doing it as only a one-shot measure this year, but for committing this government to a continuation of the homeowner grant, for increasing the supplemental for next year and for continuing to look at the tax measures to try to accomplish what is necessary for education — that is, a willingness of the taxpayers to support it at the same rate as the economy.

I've asked many taxpayers: "Would you be willing to have increases of 6 percent if the economy is running at 6 percent?" They say: "We have no difficulty with that." What they have had a lot of difficulty with is a 25 percent tax increase when the economic indicators were at 5 or 6 percent. That is what is happening.

To conclude, the member feels that the school boards should have full autonomy to set the budget at whatever level they want and then send $90 out of every $100 of that to the provincial government, which should pay it without question or without any input. If we're moving to the provincial government now guaranteeing 100 percent of the funding for education, based on all of the expenditures of last year plus an increase in line with the economy.... That is what the royal commission report suggested — in other words, block funding based on actual expenditures plus an increase in line with the economy.

I think the Finance ministry is to be commended for accepting that, because it meant a lot of extra funding and taking on a lot of extra responsibility. But you could not have a system  — nor did Sullivan recommend a system — where the government picks up all the tab for education and somebody else sets the total amount. You could not have a system like that and make it work.

With all of my compliments to the Minister of Finance I would hope that next year, as we ask for our share of the money, he would be more than happy to oblige to keep a wonderful education system going. This will help a lot of taxpayers, and it will not hurt those at the lower level. I certainly support this bill. I think it's a good measure, and I support the commitment for the future that is necessary in the best interests of education.

MR. BARNES: I just want to say a few things on this bill. I'm not going to speak with the detailed analysis of the critic or the Minister of Education. But the minister referred to school districts wanting to set their programs and have the government pay the tab. I think that's a fair exchange when you consider that taxpayers are taxed and the government spends the money. Very few taxpayers really have that much to say about what the government is going to do — what priorities they're going to set. I suppose that once you're elected to government, that's as it should be. But surely we realize that education ultimately has to be recognized as a public responsibility, not just homeowners' responsibility.

We've come along way as far as our educational aspirations are concerned.

Interjection.

MR. BARNES: I realize they're part of the public. I'm talking about the general public. The minister is trying to throw me off course. He knows what I'm driving at. Education benefits the public generally. It benefits every sector of society. We have to recognize that responsibility and stop trying to find ways of shifting the burden on certain classes of people.

As far as this bill is concerned, it's quite evident that the larger your premises the better a tax break you receive. It's been quite clear that people with modestly priced homes, who may be really up against it as far as their disposable incomes are concerned, are not going to benefit that much from this legislation.

I'm disappointed that the minister didn't make an announcement that was a little more profound and far-reaching, recognizing that many school districts are going to be doing without because of the government's policy of referenda asking taxpayers who are already heavily burdened to assume extra taxes in order to provide what this government may consider as programs outside the block-funding formula.

Clearly there should be a different philosophical approach to education and education funding. This is really the direction that we're going to have to go. This is a step that appears to be maintaining somewhat of the status quo to protect against annually increased costs, trying to stabilize what we already have, but it's far from adequate and far from what the situation should be. I'm hoping that after the next election we're going to be looking at ideas that are far more comprehensive in terms of education funding so that we can raise the level of flexibility and respect the diversities that exist in the different school districts, doing this in such a way that the dollar does not determine whether or not an effective and comprehensive education program is available.

Mr. Speaker, I just wanted to say for the record that this will be helpful to some taxpayers — no question about it — but not to those, for instance, in the city core where they're not in those huge, expensive homes, and perhaps not the high-wage earners. But it's a step, I suppose, in the direction of maintaining something of the status quo.

[ Page 10040 ]

MR. REID: I take pleasure in standing in my place today to speak on Bill 14, because in my constituency, in Surrey, it was more than evident in the recent referendum that the taxpayers of my riding are adamant that tax relief and the possibility of increased taxes for school costs.... It was a total refusal. We had more than a 65 percent opposition across the municipality of Surrey-White Rock in the referendum.

I attended a meeting — which the minister so graciously attended — in my constituency just before the referendum was voted on. A large segment of the community showed up, and they heard the minister make his case for block funding. They also allowed the opportunity for the Minister of Transportation and Highways (Hon. Mrs. Johnston), who also happens to represent one of the Surrey ridings.

I can tell you that $209,824,205 was the budget approved by our school board last Monday, an increase of $3.5 million in less than a month. Even though the referendum passed, they raised their budget by over $3.5 million.

What troubles me — as the member from Vancouver Centre said — is that the mean area of taxpayer costs in Surrey is $116,000 as it relates to the chart which was presented to us by the minister last week. This indicates a reduction in our riding of $97 on the average taxpayer as a result of this amendment. I can tell you that it couldn't come to a more welcome community than mine. The reason I say that is because I have the results of the referendum poll that was conducted to....

MR. CLARK: What was the turnout?

MR. REID: Okay, I'll give you that, Mr. Member.

In 30 polls in my constituency were the following results: James Ardiel Elementary School — 161 in favour of the increased taxes, and 353 opposed; West Whalley Junior Secondary — 150 approved the additional expenditures, and 399 were opposed; Prince Charles Elementary — 109 approved, and 315 were opposed; William Beagle Junior Secondary — 158 would approve it, and 259 would have been opposed; Senator Reid — strangely enough, 214 approved it and 183 were against. The reason for that one, I might point out, is that the area surrounding Senator Reid happens to be the headquarters of the B.C. Teachers' Federation for Surrey. So it probably was indicated that it was the only school and the only area that voted in favour of increased taxation.

Let me give you the other ones.

MR. CLARK: Is that in your riding?

MR. REID: No, not in my riding.

Erma Stephenson Elementary — 105 approved of the increased taxation, and 231 were opposed — over 60 percent; Riverdale Elementary — 177 approved, and 341 opposed; Hjorth Road Elementary — 212 approved, and 310 opposed; Johnston Heights Senior Secondary — 253 approved, and 454 opposed; Green Timbers Elementary — 187 approved, and 264 opposed; Fleetwood Elementary — 214 approved, and 537 opposed; William Watson Elementary — 64 approved, and 148 opposed; David Brankin — 136 approved, and 192 opposed; Frank Hurt Secondary — 245 approved, and 318 opposed; Dr. F.D. Sinclair Elementary — 154 approved, and 290 opposed; T.E. Scott Elementary — 148 approved, and 235 opposed; Newton Junior Secondary — 555 approved, and 605 opposed; municipal hall — 101 approved, and 228 opposed.

Interjection.

MR. REID: For the record, right.

This is for the record because I want it to go down in perpetuity that the constituents in my riding were opposed almost unanimously to the increase in taxation. It's so those people from the opposition who won't be around next time can keep a copy of this Hansard under their pillow, and the next time they're talking about taxation to the people who voted them out of office, they will know why.

In those dynamic ridings such as Surrey, this was the result: Anniedale Elementary — 45 approved, and 85 opposed; Port Kells Elementary — 40 approved, and 146 opposed; Cloverdale Elementary, my riding — 249 approved, and 581 opposed. That's where the rodeo Is. Latimer Road — 181 approved and 317 opposed.

Interjection.

MR. REID: No. Only one, I told you. I'll give you the one back. I'll read it back in the record.

Grandview Heights Elementary — 98 approved and 205 opposed. Now down in that dynamic South Surrey-White Rock-Cloverdale area: Crescent Park Elementary — 539 approved, and 792 opposed; Sunnyside Elementary — 171 approved, and 326 opposed.

In your language, that's close. Okay? That's what you're going to have in the next election. You're going to be that far off.

[4:30]

Earl Marriott Secondary — 283 approved, and 789 opposed — talk about a pretty strong message; Ray Shepherd Elementary — listen and pay attention — 260 approved, and 576 opposed. That's more than what you'd call a fair margin. H.T. Thrift Elementary — 173 approved, and 549 opposed. That's a pretty strong message. Peace Arch Elementary — down in that sunny White Rock-South Surrey area where all the dynamic leadership is: 117 approved and 226 opposed. The next one should really put you on your ear, Mr. Member. White Rock Elementary, where the seniors are worried about taxes: 327 approved and 813 opposed.

You asked me earlier about the record of the vote. It's very troubling, because there were 18,160 votes cast out of a total possibility of 120,363 — 15 percent got out to vote. But that 15 percent gave us a very strong message. If you multiply those who didn't come out to vote by the same percentage of rejection,

[ Page 10041 ]

it would have been a significant message to the NDP and those people who propose that people are satisfied with more taxation.

In my riding, with 40,766 students, our costs today in running the school district in 1990 is $209,824,205. You can divide it by any number you want, but it's a lot of money.

Our taxpayers have said once and for all: "We want to give a message to this government. We want to talk about the homeowner grant amendment and how much we support that amendment. We want to talk about leadership and good government and about a government that wants to keep the taxes for the average taxpayer of a constituency which is the fastest-growing in British Columbia...." The answer was a resounding no.

I commend the Minister of Finance for Bill 14. 1 stand in my place and offer support for Bill 14 and support from a resounding electorate who said: "No more taxation in Surrey-White Rock in 1990."

[Mr. Speaker in the chair.]

MR. CLARK: Thank you, Mr. Speaker. Now that you're in the chair, you'll probably be interested to note that the last speaker's detailed, poll-by-poll analysis of the referendum results in his constituency has nothing to do with this bill. I'm sure you'll show the same latitude to members of this side of the House, Mr. Speaker.

I just have a few comments about the bill. This was meant to be one of those platform items for the governing party going into a fall election. I know that because there is a direct correlation between the number of times an announcement is made — and the number of press releases issued — and the saliency of the issue in any platform document going into an election. If there's only one press release issued by the government, then, essentially, it's not that significant. It's just another announcement.

If there are two or three press releases, then it might be one of those second-tier election platforms. When an announcement is made five or six times, press conferences are held and different ministers are involved — and we end up with four to six press releases on a subject — then we know the government really wants to highlight this issue. They, of course, have done that.

The problem was that the announcements were for significant tax relief for homeowners. And then the bill came in. They were confounded, because they built up all these expectations about how great this legislation was, and it didn't quite meet the billing. That's the danger in these multiple announcements: you get people excited.

British Columbians welcome a tax break. We on this side of the House will be supporting this bill, because any tax break is welcome news to citizens of British Columbia, who have been overtaxed by this administration. But even when this government gives a tax break, its ideology intervenes — as is always the case with this administration.

The tax break in this bill varies according to your wealth. In other words, the wealthier you are and the bigger your home, the bigger your tax break. Let's look at the facts. Approximately 300,000 households in 22 school districts get no benefit at all. The government had press releases and announcements saying that everyone was going to get a tax break and everyone was going to have school tax relief, but 300,000 households in 22 school districts got no benefit at all. In another ten districts taxpayers receive assistance of less than $10 a year.

After the tax increases imposed by this administration, I don't think giving back ten bucks annually was enough to influence their vote, and I don't think it would be enough even if they gave them more. Certainly if they thought it would have some influence on them, I don't think $10 would do it.

We're up to 32 school districts that either got no money — no tax break — as a result of this bill or got ten bucks a year. Maybe in Surrey they got more. I'm sure they did, so Surrey got more. I know that Shaughnessy got more. West Vancouver got big tax breaks.

But, you know, in some districts they didn't get that much. Let's look at a few things. I have here, from Kamloops, a quote: "A provincial grant that gives owners of higher-priced houses a tax break means Kamloops taxpayers with the fanciest homes pay the least overall tax increase." Now listen to this, Mr. Member for Surrey-White Rock-Cloverdale: "For those with houses assessed at $40,000, the overall tax increase for this year will be 15.55 percent. People with houses assessed at $100,000 will pay a 2.2 percent tax increase." Someone with a $100,000 residential assessment gets $430 back on school taxes, plus — now — $129 for the supplemental grants. Meanwhile, someone with a $40, 000 assessment gets the $430 basic grant, the same as last year, but doesn't pay enough school taxes to get the additional grant. So if you have a $40,000 home — a modest home in Kamloops — you get no tax break. If you have a home in Kamloops assessed at $100,000, then you get a $129 break.

It's very clear, from the philosophy of this administration, that they're biased. The fancier your home, the bigger the tax break; the more modest your home, the less your tax break.

Interjection.

MR. CLARK: Well, average people have seen personal income tax increases, medical service premium increases and fee and licence increases, and soon they'll see the GST.

The government gives no tax relief across the board. The government thought they were going into an election. They made five or six announcements. Why wouldn't the government provide at least some tax relief for every homeowner in British Columbia? Because it doesn't fit the sort of narrow ideological agenda on the other side. If you live in White Rock and you have a fancy home, you get more money than if you live in White Rock and have a modest

[ Page 10042 ]

home. That's the reality. A mansion in Shaughnessy....

Interjection.

MR. CLARK: It is capped at $1,000 — that's true. A mansion in Shaughnessy gets $1,000, and a modest home owner in Kamloops gets nothing. When you combine that with the other initiatives in tax policy of this administration, when you look at the debate on the sort of flat-tax option for homeowners and for municipalities — all of which brings in an element of regressivity to the tax system — this is another example....

Before I conclude, let me talk about another thing that the member for New Westminster (Ms. A. Hagen) said. That's the difference between the rhetoric and the reality. We have lots of rhetoric from the other side. The reality is a little different.

Look at the numbers. The budget says this is a $50 million promise; but the press release says only an $18 million saving to provincial homeowners. The Minister of Education (Hon. Mr. Brummet) said: "Well, it's $50 million if you look at what it would have been had it not been for this grant." The reality is, however, that it's an $18 million tax break for homeowners. That means that 400,000 homeowners get the break. That's an average of 45 bucks annually for homeowners in British Columbia. But on budget day the minister released a number that said a $250 break for a homeowner in North Vancouver. That was, I think, the only number used. Yet the average is $45, and 300,000 get nothing. The number used in all the TV ads, all the commercials, all the "B.C. Reports" and all the propaganda from the government generally refers to $250 for this homeowner in North Vancouver.

Yes, some homeowners in North Vancouver do get $250. Yes, that's a good thing because tax relief is always a good thing, anytime, especially when they've had so many tax increases from this administration. But surely it would be fairer to have any tax cut across the board. Surely it would be fairer to have, if not a tax break that was bigger for poor people than for rich people, then at least the same dollar tax break for all homeowners in British Columbia. That would surely be fairer, given the kind of tax burden they've had with the Tories in Ottawa and this particular administration here in Victoria.

So even a tax break hasn't really flown that well for this government. Even when they thought this would be a big election winner for them, it hasn't been the case. That's because they don't seem to understand the simple question of fairness, the simple reality that if the government were honest and fair and provided tax relief across the board, it would give them much more kudos — instead of skewing the tax break for the wealthier homeowners, skewing the tax break in favour of those who least need a tax break in British Columbia.

MR. LOENEN: Mr. Speaker, I'm delighted to stand in my place and support this legislation. In fact, what it does is address an injustice that has festered for a long time, and grown in the last few years, when we've seen rapidly rising assessments in certain parts of the province, particularly the lower mainland and lower Vancouver Island. This legislation recognizes the representations that have been made not only by individuals and municipal councils, but also by the GVRD.

I think the mayor of Vancouver and a delegation from the GVRD came to Victoria two years ago with a brief, well-researched document that showed that because of rising assessments in the lower mainland, the burden for education funding had shifted from the rest of the province to the lower mainland. They made the case that the lower mainland paid a disproportionate share of education funding, to the tune of $150 million. That was two years, and ever since then we have seen nothing but rising assessments in the lower mainland, to the extreme where some families who live on fixed incomes and some elderly people who have lived in their homes for perhaps ten, 20 or 50 years have been forced out because they were carrying a disproportionate share of the education burden.

The member opposite ought to recognize that on this side of the House we have always been proud of the homeowner grant initiative, because it is meant to help provide housing for people. This bill, which carries that principle a bit further through the supplementary homeowner grant, is also directed to do that — to provide housing and to make it possible for people to continue to live where they have perhaps lived for many years, not to be forced out because of rising taxes.

The member opposite scorns this initiative and says that somehow it is designed to favour the rich, the wealthy and the well-to-do. How wrong of him, because in many instances there is no relationship between rising property values and the actual cash flow of those people; that is particularly true for the elderly and for people on a fixed income. They may live in their family home, but now suddenly in the last years of their life, when at last they are looking forward to retirement in their own home, they are faced with a situation where they are forced out of that home in order to pay the taxes, which have increased so dramatically because of the rising values.

[4:45]

It's very easy to say that somehow more benefits are going to the lower mainland than to people in Kamloops. This legislation is designed to even out some of the inequities that exist. Ever since I was elected in '86, the school board and individuals have come to me and said: "Look, there is a great inequity." Whereas in our community the average homeowner might pay $400 in property taxes to be directed towards education, Prince George, Kamloops and many other places around the province either pay very little — maybe less than $50 — or nothing towards the education portion.

That kind of inequity certainly needs to be addressed, and I am happy to see that this legislation

[ Page 10043 ]

addresses it. We have listened to the concerns that have been expressed; we have listened to the representations that have been made. This is a direct response to those concerns.

Mr. Speaker, as I have indicated, it is a great relief to the people in my community. As I said, they are immensely grateful that at last this government has recognized the imbalances that have been generated in the last few years because of the rising assessment.

In my community the average homeowner will benefit to the tune of $93 this year because of this legislation. In addition to that, that $93 will double next year. It is for that reason that I am pleased to stand here and commend the minister and the people who have worked on this and who have listened to the concerns that have been expressed. I see this as a great initiative that brings about greater equity, more justice and more fairness for all citizens in the province, allows people to live in their homes and makes home ownership more affordable.

I support this legislation.

MR. ZIRNHELT: I rise to join in the debate and to make the simple point that the people in the Cariboo were expecting significant relief from school taxes. That didn't happen.

MR. LOENEN: They've never paid enough as it is.

MR. ZIRNHELT: Convince them. Join me on the campaign trail and convince them.

MR. LOENEN: Are they paying $400...?

MR. SPEAKER: Order, please. The member interjecting across the floor has just had an opportunity to speak. Perhaps if the member speaking could address the Chair, we could proceed without interjections.

MR. ZIRNHELT: Mr. Speaker, with the introduction of block funding, I think it was abundantly clear to people, when they heard the budget as well, that there would be significant relief; that hasn't happened. People have come to me and said that they feel that there should be some significant relief to those who pay the average; that hasn't happened. In fact, we expect the average taxes to go up at least 8 to 10 percent, depending on the final figures. I think we have to recognize that the benefits are skewed towards people with larger homes and that there will be some small benefit to people in our riding and the three school districts involved; in fact, they may pay $70 less. But there is still a significant increase because most of the homeowners in our area are below the provincial average.

MR. SPEAKER: Pursuant to standing orders, the House is advised that the Minister of Finance closes the debate.

HON. MR. COUVELIER: Mr. Speaker, I've listened closely to the comments from the members on the opposite side of the House. I haven't detected that they've given one new piece of information, other than that they're evidently going to support the bill. What they seem to be basically saying is: "We support the bill. It's a good idea, but we want more money." I'm constantly amazed at the fiscal ineptitude of the members opposite. In particular, when I look at their proposed expenditure profile, were they ever to inflict themselves on the B.C. electorate by winning an election.... God forbid!

With the expenditure ambitions they have, it's abundantly clear to all of us who are intimately associated with the problem that B.C. would immediately lose the balanced budget that we've worked so hard to arrive at and that we've become so proud of. The people across the floor have talked about expenditures which, by my calculator, add up to over $3 billion extra per year. Inevitably, such an outcome would be vehemently opposed by the citizens of this province, who appreciate the fact that under this administration they have one of the lowest taxing regimes in Canada. Furthermore, with the proposal brought forward under this bill, 500,000 British Columbians who didn't receive a benefit last year under this program now receive a benefit.

I call for second reading, Mr. Speaker.

Motion approved.

Bill 14, Home Owner Grant Amendment Act, 1990, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. STRACHAN: Mr. Speaker, I call second reading of Bill 15.

INCOME TAX AMENDMENT ACT, 1990

HON. MR. COUVELIER: This bill amends the Income Tax Act to enhance the renter's tax reduction. This program reduces provincial income tax for lower-income families and individuals who rent their accommodation. The program is being enhanced because of the continuing shortage of affordable accommodation in many areas.

The legislation increases the maximum tax reduction for 1990 from $200 to $225 per family member, subject to a limit of 10 percent of the rent paid. The legislation also amends the formula which reduces benefits as income rises, so that families will be eligible for larger tax reductions over wider income ranges. For 1990, benefits will be reduced by 3 percent of net family income in excess of $10,000, plus $4,000 for the first family member, $3,000 for the second, $2,000 for the third, and $1,000 for the fourth and each subsequent family member.

The increased level of benefits and the new eligibility formula will ensure that more renters — particularly families — are able to qualify for greater levels of assistance. For example, a family of four with a net income of $30,000, who would have received a tax reduction of $200 for 1989, will qualify for a tax reduction of $570 for 1990. With these changes, the

[ Page 10044 ]

number of households able to benefit from the renter's tax reduction will be increased by 40,000 to 120,000, and the amount of tax relief provided will be increased by $12 million to $24 million for 1990.

The renter's tax reduction was designed as a transitional program to assist renters during the current period of low vacancy rates. Benefits are accordingly scheduled to phase out gradually. For the years 1991 to 1994, the tax reduction will respectively equal 80 percent, 60 percent, 40 percent and 20 percent of the amount obtained during the 1990 formula. This timetable reflects a one-year delay in the originally proposed phase-out schedule. However, the renter's tax reduction remains a transitional program. It is expected that the supply of rental accommodation will increase significantly in the near future, in part because of generous rental supply programs provided by the province raising vacancy rates above the very low levels currently being experienced. I move the bill now be read a second time.

MR. BLENCOE: Mr. Speaker, we intend to support this piece of legislation, but we want to make a few comments. This legislation is clearly intended by the government to give the impression that they are trying to tackle the housing problem and particularly the financial predicaments that tenants face.

There are approximately one million tenants in the province. In its advertising and other methods of information dissemination, the government has clearly attempted to give the impression that this is a universal tax credit. But when we analyze this legislation, as we did last year, we clearly find that 270,000 families in the province will not get a dime from the program; 70 percent of renters will not benefit at all. The average benefit for the rest will be approximately $200 a year. That is equal to about one month's rent hike, for instance, in the infamous rental dispute currently in my community at View Towers.

Much of the rationale by the government in introducing this bill is to avoid the issue of introducing legislation that deals with rent stabilization in British Columbia. The critical issue facing tenants today is that any rent increase is legal. Currently this administration refuses to deal with the issue of rent increases and refuses to introduce a dialogue for review of rent increases. We have documented many that have been clearly taking advantage of the market and have been very unfair and unjustified.

With such a measure, if you don't have rent stabilization or any review procedure, the government is basically passing on an increase into the landlords' pockets. It becomes a deep pocket for the taxpayer because, again, there's no mechanism for review. Those who benefit by this, in nine cases out of ten, will see a rent increase to take up the amendment that is before us today.

Although we support the legislation, we feel it's more style than substance. It's to give the impression that the government is working in the interests of tenants. But without a measure that allows tenants to have their increases reviewed, it is basically only window-dressing. As I have said, the majority of tenants — 270,000 families in the province — will not benefit and will not gain a dime from this piece of legislation.

We believe there has to be a comprehensive way of dealing with landlord and tenant issues in British Columbia. Once again, this is an insensitive way, because it gives the false sense that all tenants will benefit by this legislation. Of course, by analysis, most tenants will not benefit at all.

As we support it, we once again call on the government of the day to ensure that there is a mechanism to review increases that are clearly unfair. Although this piece of legislation will benefit — as the minister said — 120,000 renters, most tenants will see no benefit at all. Rather than continue to put forward measures that appear to deal with the issue, we would rather have substantive ways of dealing with the crisis facing tenants in the province of British Columbia.

The private member's bills that I tabled today have to do with much of that. I will continue to put forward alternatives to dealing with these important issues facing tenants in the province of British Columbia.

[5:00]

MR. CLARK: Mr. Speaker, I will comment very briefly on this bill, as my colleague from Victoria has canvassed it in some detail and has covered most of the points.

The main point I would like to make is that the renter's tax credit can sometimes be labelled the landlord's tax credit, in the absence of any check or review on landlords. The reality is that the money can very quickly flow through to the landlord in terms of any rent increase as a result of any tax credit given by the provincial government. It doesn't have to be rent control; it doesn't have to be even tough guidelines, which I would like to see; it could be a simple review process by the provincial government. But in this case, while simply giving a modest tax credit to a few more people is good news, it could be illusory. It could be a precarious benefit without any clear check on landlords. The money could simply flow through the hands of the tenant into the pockets of the landlord. There needs to be a mechanism for reviewing unscrupulous landlords. Not all landlords, of course, would do that.

[Mr. Pelton in the chair.]

We need some review process, some appeal process, for tenants to ensure that the benefit which the provincial government is offering them in this tax credit goes to the renter and not to the landlord. While a tax credit of any kind is certainly welcome — and we plan to support it — in the absence of any review on the landlord, it seems likely to me that this tax benefit, it if is that, will be eroded, and in many cases eroded completely.

[ Page 10045 ]

DEPUTY SPEAKER: Hon. members are advised that in accordance with the standing orders the minister closes debate.

HON. MR. COUVELIER: I move second reading of Bill 15.

Motion approved.

Bill 15, Income Tax Amendment Act, 1990, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. STRACHAN: I call second reading of Bill 26.

PERSONAL PROPERTY SECURITY
AMENDMENT ACT, 1990

HON. MR. COUVELIER: The Personal Property Security Act is a thorough reform of personal property security law in our province. This statute provides a completely new code of law for secured transactions and introduces many innovative features unique to British Columbia.

This statute is a result of many years of consultation and discussion with many different segments of the financing community. We have sought the comments of consumers and industry, and where a valid suggestion was received, an improvement was made.

Bill 26 reflects the continuation of this process. It amends the Personal Property Security Act to take advantage of various innovations that have recently become possible.

The most important is the registration of security interest by electronic transmissions. Currently, all personal property registers in Canada and the world require a lender to fill out a form and deliver it to a registry. The registry will then transcribe the information from the form onto its data bank. Electronic registration will allow a lender, if he so chooses, to send the information directly to the registry's data bank. The lender can do this from his own office using his own computer and a telephone line. This option would allow registrations to be done faster, with less labour and fewer chances of error. Of course, it will still be possible to register in the conventional way with paper forms as well.

Other amendments outlined in Bill 26 implement several improvements and refinements suggested by the public since the PPSA was enacted. These suggestions improve the act in certain specific areas. For example, the original act prevented all wages, fees or dues from being assigned. This provision was changed by Bill 26 to allow professionals such as lawyers and dentists to assign their accounts receivable in order to secure loans.

Other changes are made to accommodate the growing securities lending market in Vancouver.

Other changes are necessary to ensure that the PPSA does not diminish the effectiveness of Crown tax liens for taxes collected by sellers on behalf of the government. An unintentional by-product of the PPSA is that Crown tax liens would no longer enjoy priority over the assets of a delinquent taxpayer.

This bill introduces amendments to the Hotel Room Tax Act and the Social Service Tax Act to ensure that the Crown may still collect taxes which a debtor holds in trust for the government.

The amendments give Crown tax liens reasonable but limited priority over encumbrances granted by the taxpayer to a secured creditor. This limited priority replaces the priority Crown tax liens currently enjoy.

Finally, proclamation of the PPSA was planned for the fall of 1990 to allow inevitable oversights and hidden faults to be identified. For example, as a result of a drafting oversight, the rule specifying when an organization has knowledge of an event is different for associations than for other corporations or partnerships. Similarly, the type of goods that have to be identified by serial number is unclear in the original statute. None of these errors are fundamental or have a widespread impact. Nonetheless, resolving these drafting difficulties now, before the legislation comes into force, will prevent uncertainty and help reduce litigation.

The innovations, refinements and corrections contained in these amendments reflect the continued commitment of this government to provide British Columbians with a modern and progressive regulatory framework for its financing industry. This bill will increase the ability of the Personal Property Security Act to reduce borrowing costs and to make secured financing easier to obtain. These benefits will further enhance the business and investment climate of B.C.

I move second reading.

MR. CLARK: This is a complex amendment bill amending a complex bill. I remember last year — in July, I think, late at night — we were debating the original bill. I remember sometimes when the minister and I were the only people in the House. I supported the bill at that time. I thought there were some areas that could have been improved; they haven't been improved by this amendment act in the areas I raised last year, but I am generally satisfied that the PPSA brought in by British Columbia will be the best personal property security legislation in the country. That is the pattern in terms of being slightly behind other provinces. Each province that has brought in such legislation has improved upon it; I think this is another case where that has happened.

There will be some discussion about some of the details in this bill which I think are properly left with the committee stage on the use of electronics and a range of other things. I might say that this bill and one other to follow — which was meant to be somewhat of an exposure bill at the time; it hasn't been proclaimed yet.... It seems to me clearly appropriate that any changes be made now before the bill is proclaimed, and in that respect I don't think I'll have any problems, but we may uncover some in committee stage debate.

[ Page 10046 ]

DEPUTY SPEAKER: Hon. members are advised that pursuant to standing order 42, the minister closes the debate.

HON. MR. COUVELIER: I move second reading.

Motion approved.

Bill 26, Personal Property Security Amendment Act, 1990, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. STRACHAN: I call second reading of Bill 30.

FUEL TAX VALIDATION ACT, 1990

HON. MR. COUVELIER: The purpose of Bill 30 is to amend two of the three predecessor statutes to the Motor Fuel Tax Act to protect fuel tax revenue collected between 1974 and 1976. Prior to 1985, provincial motor-fuel taxes were collected under three separate statues: the Gasoline Tax Act, the Gasoline (Coloured) Tax Act and the Motive Fuel Use Tax Act.

By way of background, the province became aware in the mid-1970s that these three taxation statutes imposed an indirect tax rather that a direct tax and were therefore unconstitutional. As a result, the acts were amended in 1976 to rectify this problem, ensuring that the tax imposed was a direct tax. Approximately five years later, in 1981, a court challenge was launched by the airline industry to recover taxes it had paid under the Gasoline Tax Act for the 1974-76 period, or for the two-year period prior to the amendments to correct the constitutional problem.

When the industry paid these taxes it did so on the understanding that the statutes were constitutionally valid. Indeed, both the government and the industry believed that the taxes were constitutionally valid at that time. Thus the industry conducted its affairs on the assumption that the tax was payable and set its prices accordingly. In other words, the industry included the cost of the tax in the price it charged its customers. To have returned this tax to the industry in 1981 would have presented it with a windfall gain at the expense of government revenues which had already been spent on essential government programming. For this reason, an amendment to the Gasoline Tax Act was introduced in 1981 to retroactively validate the tax as a direct tax so that the province could retain the tax collected. Retroactive amendments were not made to the Gasoline (Coloured) Tax Act or the Motive Fuel Use Tax Act at that time, because they were not subject to court challenge. Now, however, the Gasoline (Coloured) Tax Act and the Motive Fuel Use Tax Act have also been challenged to recover taxes paid between 1974 and 1976.

It is important to understand that now, as in the earlier case, the taxes were paid by the businesses currently challenging the legislation on the understanding that the acts were constitutionally valid, and they conducted their affairs accordingly. The recovery of these taxes would therefore represent a windfall gain to the businesses concerned. For this reason and because the retention of these revenues by the province is consistent with the province's previous response to the challenge by the airline industry, this bill amends the two statutes retroactively to retain the taxes collected during the 1974-76 period. This bill ensures that the statutes are applied consistently to all businesses, including those which paid the tax during this period but did not challenge the legislation, and it retains government revenues which would otherwise have to be raised from other taxpayers.

MR. CLARK: As the minister has canvassed the area well, I don't have any problem with it. In fact, while one doesn't like to see taxes applied retroactively, in light of the court challenge — which was an interesting one; I followed it for some time — it's certainly appropriate. The airlines clearly did collect the tax from their consumers by way of airline tickets. Any attempt to overturn that now seems to me to be slightly overreaching on the part of the airlines. I don't know how many thousands of dollars they spend on litigation with respect to this, but clearly the intent of the bill is there. The fact that it was slightly ultra vires of provincial jurisdiction should not have been an excuse for litigation. I don't have any problem supporting this retroactive bill at this time.

HON. MR. COUVELIER: I move second reading, Mr. Speaker.

Motion approved.

Bill 30, Fuel Tax Validation Act, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. RICHMOND: Mr. Speaker, I call second reading of Bill 32.

FINANCIAL INSTITUTIONS
STATUTES AMENDMENT ACT, 1990

HON. MR. COUVELIER: The Financial Institutions Act and the Credit Union Incorporation Act reform and modernize the regulatory regime for financial institutions in the province. These statutes provide an updated, effective and balanced regulatory framework for B.C. credit unions, trust companies and insurance companies, and for extraprovincial financial institutions operating in the province.

The Financial Institutions Act and the Credit Union Incorporation Act provide enhanced public protection while at the same time allowing provincial financial institutions to be more competitive. These statutes are the result of several years of consultation

[ Page 10047 ]

with the representatives of the credit union, trust company and insurance sectors, the public and other provinces. Because of the complexity of the legislation, it was recognized when the acts were passed that errors, omissions and points of clarification would be identified. Proclamation has been delayed, partly to allow appropriate changes to be made before the legislation becomes effective. This is simply an essential last step in the extensive consultation process which has helped to make this legislation universally accepted and respected.

[5:15]

One of the most important amendments contained in Bill 32 is the introduction of an indemnification provision for directors and officers of financial institutions. For consistency, a policy decision was made to adopt, where appropriate, the corporate law provisions of the Company Act for financial institutions.

It has been pointed out by the credit union system and the B.C. bar association that there are legal interpretation problems with the operation of section 152 of the Company Act, which provides for the indemnification of directors and which has been adopted by reference for financial institutions. The directors' and officers' indemnification provision in the existing Credit Union Act is superior to the Company Act provision. A new section, modelled on the existing Credit Union Act provision, is being added to the Financial Institutions Act.

This provision will permit a financial institution to indemnify its directors and officers for legal costs incurred as a result of an action or proceeding brought against them, provided that the directors or officers acted honestly, in good faith and in the best interests of the financial institution. In other words, directors and officers should not have to bear the burden of legal expenses if they have properly done their job and discharged their duties.

Other amendments contained in Bill 32 implement several improvements and corrections, and provide sufficient authority for regulations which have been circulated in draft form for comment. For example the provisions establishing adequate capital requirements have been clarified to ensure that there is specific and clear authority for the establishment of a capital adequacy test which requires riskier financial institutions to have more capital. This approach is similar to the one recently established for banks.

It is anticipated that the Financial Institutions Act and the Credit Union Incorporation Act will be proclaimed in the summer of 1990. The one-year period between passage and proclamation of the legislation has provided the industry with time to become completely familiar with the enhanced regulatory requirements. It has also allowed oversights and errors to be identified and rectified prior to the acts coming into force.

The clarifications, corrections and refinements contained in these amendments are a reflection of the commitment of the government to establishing a modern, efficient and effective regulatory regime for financial institutions in B.C.

MR. REID: Mr. Speaker, with the courtesy of the House, I ask leave to make an introduction.

Leave granted.

MR. REID: Mr. Speaker, on behalf of the first and second members for Vancouver-Little Mountain (Mrs. McCarthy and Mr. Mowat), I take pleasure in introducing to the House Ashok Khanna and Jubilee Khanna. Would the House make them especially welcome.

MR. CLARK: Mr. Speaker, this is a very complex piece of legislation which we debated late at night in July of last year. There were lots of people in the gallery listening intently to the scintillating debate, but I won't belabour that point.

When second reading of the bill came In, I had three criticisms. None of those is addressed by these amendments.

The one area which I still think I would have preferred to have addressed has to do with the regulation of extraprovincial financial institutions in British Columbia. In other words, I think one of the problems in the Principal Trust affair was that British Columbia relied on the home jurisdiction — Alberta — to do the regulating.

In Ontario, in similar financial institutions legislation, any institution doing business in Ontario must subscribe to Ontario's rules. Unfortunately, with this legislation, which enhances financial institutions legislation in British Columbia — and I think it does a good job of that — if you're not headquartered in British Columbia, even though you're doing business here, you don't have to be governed by these rules. If you're an Alberta trust company doing business in British Columbia, you're regulated in Alberta.

It's my view that we should have gone along the same route as Ontario, if we could have, meaning that any financial institution, regardless of where headquartered, would have to abide by the rules and regulations in British Columbia. That, unfortunately, is not the case in this legislation. It is the major flaw that I detected in the original legislation. It's not dealt with in these amendments, although other aspects of my criticism are dealt with in a way. I find it very unfortunate that the government didn't choose to amend the bill this year in the way I suggested.

Nevertheless, clearly these are significant improvements to financial institutions legislation in British Columbia. It was a very complex bill. It's not surprising there would be amendments this session — appropriately, I think, before the bill is clearly proclaimed and up and running. I hope that all of the drafting errors were caught this time. I'm sure there will be other changes down the road. I hope this is essentially legislation that can be proclaimed and implemented.

Again, I would like the minister to comment on the possibility.... He could do this in committee stage if he wants. The problem I pick up is that financial institutions headquartered in other provinces doing business in British Columbia essentially

[ Page 10048 ]

do not have to follow the guidelines laid out in this very complex bill. Rather, they are subject to regulation primarily of their home jurisdiction. I think that's an error.

DEPUTY SPEAKER: Hon. members are advised that pursuant to standing order 42, the minister closes debate.

HON. MR. COUVELIER: I am disappointed that the hon. member didn't seem to be listening last year when we told him we were leading the country in chairing a committee to look at harmonization of legislation and closer cooperation between our regulators. It was as a direct consequence of our leadership on that issue — started long before the member received his graduate degree, I suspect — that we undertook this initiative. We have signed a memorandum of agreement among the western provinces.

Indeed, our success in that respect prompted national attention. We were requested by central Canadian jurisdictions and the Maritime jurisdictions to undertake the same difficult task for the country at large. We did that. The leadership we've exhibited and the success we've reached in that respect are now a matter of great renown and appreciation among the investment community and other governments across the country. So we take a back seat to no one, Mr. Speaker. We're in the leadership role, and we continue to provide consistency, stability, farsightedness and wisdom in the application of this great challenge

In any event, I move second reading.

Motion approved.

Bill 32, Financial Institutions Statutes Amendment Act, 1990, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. RICHMOND: I call second reading of Bill 39.

TAXATION STATUTES
AMENDMENT ACT, 1990

HON. MR. COUVELIER: This bill proposes a number of amendments to the Mining Tax Act, Motor Fuel Tax Act, Property Purchase Tax Act, Social Service Tax Act and Tobacco Tax Act. For the most part, these amendments are administrative or housekeeping in nature. However, a few of the amendments are somewhat more substantive, and I will discuss these in greater detail.

Amendments to the Mining Tax Act are proposed simply as housekeeping measures to repeal provisions relating to a tax base change in 1979 which is no longer required to administer the statute.

Proposed amendments to the Motor Fuel Tax Act and the Tobacco Tax Act are somewhat more substantive but are identical to a similar amendment to the Social Service Tax Act introduced last year. These acts are amended to require the person who applies for a refund of tax paid in error to sign the application for the refund. These amendments are required to ensure that taxpayers in B.C. are aware of all refund claims made on their behalf by third parties. The problem that these amendments are intended to address is that in some cases third parties have submitted claims on behalf of businesses without the specific knowledge, consent or approval of the businesses. These amendments will resolve this problem by ensuring that taxpayers on whose behalf refund claims are made are aware of those claims.

Six amendments are also proposed to the Social Service Tax Act. Two are housekeeping measures: the first is consequential to the reduction in the sales tax rate from 7 percent to 6 percent in the 1987 provincial budget, and the second corrects a reference error in the statute.

Two slightly more substantive amendments are proposed as a result of legislative amendments introduced last year to codify in the legislation the proportional application of the sales tax to goods used interprovincially and internationally. Railway rolling-stock, commercial trucks, aircraft and buses used interprovincially and internationally are taxed on the proportion of use in B.C. to total use. The proportional taxation formula is used in these situations to ensure that purchasers of these goods are not subject to double taxation. All provinces apply their provincial sales taxes in a similar manner.

However, in drafting the provisions relating to the application of the proportional tax to railway rolling stock, the provision failed to include railway work trains, which are also used interprovincially. Therefore, to ensure that railway work trains are also eligible to pay social service tax on the basis of the amount of use in B.C. compared to total use, the act is amended to include all railway rolling-stock used interprovincially or internationally under the proportional taxation formula.

Similarly, an amendment is introduced to apply the proportional taxation formula to private dedicated telephone services, where the service is used partly in B.C. and partly outside the province. This amendment is to ensure that purchasers of these services are not subject to double taxation, where the service is also subject to tax in another taxing jurisdiction. In those cases, where the purchase price of private dedicated telephone services also includes payments for other goods or services, the commissioner is authorized under this bill to determine the portion of the purchase price which is attributable to the private dedicated telephone service. Taxpayers are, of course, provided with an opportunity to appeal that determination.

The final amendment to the Social Service Tax Act addresses a problem relating to the overpayment of social service tax by taxpayers on lump-sum, real property contracts. Currently, under the Social Service Tax Act, tax is payable by the contractor on the purchase price of materials used to complete a real property contract. For example, if a taxpayer employs a contractor to build an addition on a home, the contractor is required to pay the tax on the cost of the

[ Page 10049 ]

materials required to complete the contract but is not required to collect tax from the purchaser.

Occasionally, however, contractors incorrectly charge tax to the purchaser on the full purchase price of the contract, including labour costs, which are not taxable under the act. When this occurs, it is generally because the contractor is unfamiliar with the legislation and has also failed to pay the required tax on the purchase price of the materials; that is, the contractor has generally purchased some materials exempt from the tax, on the incorrect assumption that the goods were purchased for resale. Thus the contractor's error results in the purchaser of the contract paying more tax than should have been paid by the contractor on the purchase price of the materials.

Purchasers in these situations currently have to seek a refund of any overpaid tax through negotiations with the contractor. Most contractors, of course, will do whatever they can to resolve the problem when they are made aware of it. However, in some situations, the contractor cannot be located, and the taxpayer is unable to claim a refund of the overpaid tax. For this reason, an amendment is proposed to allow the commissioner to refund directly to the purchaser the difference between the amount of tax paid and the amount of tax which should have been paid by the contractor on the purchase price of the materials. This amendment will provide taxpayers who cannot locate a contractor with the opportunity to apply directly for a refund of the overpaid tax.

This bill also contains a number of amendments to the Property Purchase Tax Act. Three of the amendments are simply to update references to federal statutes in the act. Of the more significant amendments, the first expands the definition of "related individual" to include fathers- and mothers-in-law, grandparents-in-law and great-grandparents-in-law. This definition is applicable to tax-free transfers of principal residences, family farms and recreational residences. The definition is expanded to correct an anomaly in the definition whereby, for example, tax-free transfers could be made to a person's son-in-law or daughter-in-law but not to a person's mother-in-law or father-in-law.

Bill 39 also corrects an inequity in the existing exemption for transfers pertaining to the creation or dissolution of a family farm corporation. Currently the exemption allows tax-free transfers of land from an individual to a family farm corporation, provided the individual and all of the shareholders of the family farm corporation are related. For example, a farmer can currently transfer his or her family farm to his children's family farm corporation tax-free However, the existing exemption does not allow the tax-free transfer of a family farm from the individual farmer to a family farm corporation where all of the shares are held by that farmer. The intent of this exemption was to allow the tax-free transfer of family farms where the land is held and farmed within a family. This amendment ensures that the intent of the exemption is reflected in all transfers of farmland within the family group.

[5:30]

The bill also clarifies the intent of the current exemption for transfers of land under an agreement for sale. The wording under the current exemption could be incorrectly interpreted by taxpayers as meaning that an assignee of an agreement for sale can take title to the property tax-free, provided the original purchaser paid the tax on the registration of the initial agreement. This does not reflect the Intent of the act and could result in a significant erosion of the tax base at the expense of essential government revenues. Therefore the exemption is clarified to ensure that an assignee of an agreement for sale is entitled to the exemption only if the assignee paid the tax on the assignment.

The final Property Purchase Tax Act amendment expands the exemption for transfers of land from the director of the veterans' land act to a veteran. Great care was taken when this act was introduced to ensure that veterans received generous treatment under the act in recognition of their contribution to this country and this province. An exemption was provided for the transfer of land from the director of the veterans' land act to a veteran regardless of the type of land transferred. However, in drafting the exemption, the definition of "veteran" under the federal legislation was used in an attempt to ensure that all veterans could receive the exemption. Unfortunately, administrative policy changes within the federal Veterans' Land Administration resulted in property tax liabilities being incurred on some transfers because the VLA began transferring titles directly into the names of both the veteran and the veteran's spouse. This administration clearly did not intend to impose any kind of a penalty on veterans, who have served their country so well.

Having spoken at some length to all of these amendments so that the members opposite might more intelligently criticize them, I suppose we are now ready to deal with second reading.

MR. CLARK: This Taxation Statutes Amendment Act is a variety of statutes and is properly easier to debate in committee stage. However, let me just very briefly mention a couple of things.

It's interesting that there's a Property Purchase Tax Amendment Act — I can't remember the bill; it will be debated shortly — and yet a large part of this bill deals with amendments to the Property Purchase Tax Act. Perhaps that's just an oversight. However, I suspect it's to do with the fact that the Property Purchase Tax Amendment Act is an attempt by the government to be good-news and give some expanded relief; whereas this is really housekeeping amendments, and it kind of clutters up the good news if you have this big bill with all these amendments. I don't know what other reason there would be to have all these amendments in this bill when we have a property purchase tax amendment bill before the House.

With that said, there is one amendment to the property purchase tax which should be there and that is an amendment that stops corporations from taking advantage of the loophole to avoid the tax. I might

[ Page 10050 ]

note for the House that the Ontario Legislature just brought in legislation to tighten up their property purchase tax act so that transfers and shares of a company where land and buildings are basically the sole assets of the company will have to pay property purchase tax in that province. I think it's an amendment in Ontario which could properly have been dealt with in British Columbia. In fact, I may make the same amendment myself down the road. Unfortunately, the government has not done that.

These appear to be housekeeping amendments, and I don't think we have too many problems with them. We will canvass them in detail in committee stage.

HON. MR. COUVELIER: I move second reading of Bill 39.

Motion approved.

Bill 39, Taxation Statutes Amendment Act, 1990, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. RICHMOND: I call second reading of Bill 19.

BUDGET MEASURES
IMPLEMENTATION ACT, 1990

HON. MR. COUVELIER: This bill is an omnibus bill containing legislative amendments required to implement budget initiatives.

The budget stabilization fund was created as part of the 1988 budget to enable the province to stabilize its revenues. The fund receives money during years of unanticipated or unusually high revenue. This money, together with interest income earned on the fund balance, is available for transfer to the operating revenue of the province in times of revenue shortfall. At March 31, 1990, the balance in the fund was estimated at $1,603,000,000. A further $160 million of interest is expected to be earned in the fiscal year '90-91.

In section 1 of the Budget Measures Implementation Act, the government proposes to transfer $684 million from the budget stabilization fund to the general fund during fiscal 1991. This will leave a fund balance of approximately $1 billion. This should be sufficient to maintain services if the provincial economy experiences a slowdown.

Sections 2 to 7 of this bill amend legislation affecting various special accounts. Special accounts provide continuing statutory spending authority for certain programs that are best planned on a multi-year basis. The amount available to be spent in any given fiscal year depends on the initial balance for the year plus any subsequent revenues to be added to the account.

Section 2 terminates the farm products industry improvement fund special account. The government has decided that no further transactions will be undertaken through this special account, and the legislation is therefore no longer required. Any further transactions under the Farm Product Industry Act will be funded through a voted appropriation.

Section 3 amends the Financial Administration Act to allow the provincial treasury division of the Ministry of Finance and Corporate Relations to recover its costs from certain clients not previously charged and for certain services not previously billed. This will eliminate the previously existing cross-subsidization whereby some clients receive some services without being charged, while others were charged more than the cost of the services received.

Section 4 amends the Financial Administration Act to create two new special accounts in support of the operations of the provincial treasury division of my ministry. The first account — the provincial treasury operations special account — will allow the matching of revenues with associated expenditures even though they do not occur in the same fiscal year. This was not possible under the existing $10 subvote structure, and office costs often cause problems in determining funding requirements during the budget process.

The second account — the provincial treasury revenue special account — will allow for the accumulation of surpluses earned on the provincial treasury revenue program, which is funded by a subvote within vote 69: management of public funds and debt. This accumulation of surpluses over a period of years will then be available to fund any unforeseen loss by the revenue program. This subvote method of funding will provide for the matching of net revenues from the revenue program with any losses over several fiscal years.

Section 5 amends the Revenue Sharing Act to allow for interest to be calculated on the municipal grant stabilization account of the revenue-sharing fund's special account. This satisfies a longstanding request of the Union of B.C. Municipalities that such interest be provided.

Section 6 amends the Revenue Sharing Act to create a new local government emergency account within the revenue-sharing fund's special account. The new account will allow the government to financially assist local governments in the event that their revenues are reduced as a result of an environmental or economic emergency. This will prevent any additional burden being imposed on the existing local taxpayers as a result of the emergency. At present there is no legislation available by which the provincial government can offer such aid.

Section 7 amends the Securities Act to create a new special account in support of the activities of the Securities Commission. This will ensure that substantially all revenue raised from the regulated financial community in the province is used for servicing and regulating that community. The legislation will also permit the matching of revenues and expenditures even though they do not occur in the same fiscal year.

I move second reading.

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MR. MILLER: The bill, of course, covers a fairly wide variety of topics, and as such it may be difficult to pinpoint the overall principle of the bill. I'll attempt to deal with several of the amendments contained within the bill.

First of all, dealing with the emergency assistance section, it's certainly timely, given that the area north of my constituency and my colleague's constituency of Atlin is experiencing a great deal of difficulty at the present time, with two communities effectively cut off, in terms of automobile transportation, from the outside world. In fact, I hope to be able to get up there to assess the situation. But if funds are available on a secure basis for those kinds of issues, where people are cut off because of flooding and other disasters, then certainly that's welcome.

[Mr. Speaker in the chair.]

The central issue that I wanted to comment on was section 1. I would note just in passing that the concept of special accounts is used in a number of areas. It's used municipally, and it has been used in the past by provincial governments. I was dismayed in the early eighties when those special accounts were raided by a previous Social Credit government, raided and depleted, particularly in reforestation and silviculture. A considerable amount of money was simply scooped out of a fund that had been set aside to maintain silvicultural work in this province. We're now bearing the brunt of that lack of spending. I suppose it points out that even though special accounts are set up, there's absolutely no guarantee that they will be maintained.

The minister's comments on the bill were interesting when contrasted with statements from other sources, and indeed statements made by the minister himself. I recall having been in the House on the morning of May 29. A quick perusal of Hansard will bear this out. I recall the Minister of Finance's statement at that time: "Of course, there's no cash in the account." He was referring to the budget stabilization fund. That raises the question, Mr. Speaker....

MR. CLARK: What's in it?

MR. MILLER: I don't know what's in it. There's air in it, I suppose. Some of that hot air — some of that wind — has been used in an advertising campaign, some may have seen these advertisements on television claiming that this is a balanced budget. The people of British Columbia, watching the clever little advertisements from the Social Credit government carefully inserted between news items, may indeed have come away with the impression that this is a balanced budget, despite the fact that on May 29 the minister said: "Of course, there's no cash in the account." Why the government didn't choose to have a clip of the minister saying to the people of British Columbia, "Of course, there's no cash in the account, " is beyond me.

Interjection.

MR. MILLER: On the commercial. I think it would have been the only honest thing to do.

The basic fact is, the minister says there's no cash in the account. I don't know how they reconcile that with the television ad — that shadowy figure with the typewriter in the background, saying we have a balanced budget. It's either one or the other: there's cash in the account or we don't have a balanced budget,

Mr. Speaker, far be it from me to quote the Minister of Finance in terms of this bill and this item. He may be biased. He's also hard to figure out. He says on the one hand it's balanced, and on the other hand he says there's no cash. But when you look at some of the other impartial, objective analyses of the budget and the BS fund, you really do come up with a picture portrayed by these impartial, objective companies and spokespeople that really bears out what the minister himself had to say. For example, the auditor-general said on May 1 that there were no bank or investment accounts that could be specifically identified with the budget stabilization fund. I suppose, when we translate that from the jargon of accountants, it really means the same as what the minister said on May 29: "Of course, there's no cash in the account."

[5:45]

Interjections.

MR. MILLER: I hate to repeat myself, but my colleagues are asking me to....

MR. DAVIDSON: Point of order. I appreciate the remarks of the member; however, it's my understanding that we're on second reading of a bill which has several distinct sections. It has been traditional, and I have no advice to the contrary, that if we're going to debate matters like this we do so in committee. Otherwise, as Mr. Speaker is very well aware, we run into the same debate over and over again, both in second reading and in committee. Therefore I seek the Chair's advice as to whether or not we are going to, in essence, debate this section by section in second reading and then whip right through committee, or whether we are going to go right into committee, where this debate might be more appropriate.

MR. SPEAKER: It's an interesting point of order. The second reading is the principle of the bill. One might want to ask what that specifically might be. I was expecting the member for Prince Rupert to get to the principle of the bill, having brought up a number of issues which are completely irrelevant and never mentioned in the bill. I am sure he was using them as part of a cogent argument he was going to begin to make. However, let's ask the member to continue, perhaps on the principle of the bill.

MR. MILLER: Thank you, Mr. Speaker, and I'd also like to thank the former Speaker. The advice is most useful in terms of trying to get some debate going on the bill.

[ Page 10052 ]

I think that at the outset I did explain that the bill covers a pretty wide range of topics. I started out dealing with one of them, and I had hardly started to deal with the other one when I was interrupted on this point of order.

The bill does say that the minister shall pay money out of a fund. The minister has said that there is no cash in the account. I've pointed out already that the auditor-general has said there's no cash in the account; there's no money in the fund. I wanted to simply reinforce that by noting that Peat Marwick Thorne has also basically said the same thing. The certified general accountants have also said the same thing; in fact, they've talked about smoke and mirrors.

I think it's important, when we're dealing with these bills having to do with the finances of the province, or the lack thereof, that we have the scope to have good debates and to quote these impartial, objective sources which seem to belie the statement that the government is promulgating on the people of the province: that we have a balanced budget. So I think that's entirely in keeping with the principle of the bill.

It may be that the government wanted to bring in all of these other amendments as part of Bill 19, in order to try to deflect some reasonable debate at second reading stage.

After all, although the Finance minister may now in hindsight regret ever labelling it as such, the BS fund has certainly been a cornerstone of this government's attempt to advise or — dare I say — mislead the people into believing there's a balanced budget. In fact, there's not.

It's striking that this is the only government that for two years in a row claimed there was a deficit when there was a surplus. And for the last two years it has claimed there was a surplus when there was a deficit. I fail to see how the government can pay money out of a fund that doesn't have any money in it, unless they have to borrow the money, in which case, clearly they're in a deficit position. I'll conclude my remarks on that note.

SOME HON. MEMBERS: More, more.

MR. MILLER: I understand that there was some....

MR. SPEAKER: Hon. member, even though the government House Leader may wish you to continue, I've had a good look at this bill. On the matter of the principle of the bill, I can never recall a bill drafted in this manner being actually debated in second reading to this length, because it is essentially a bill better in hands of the committee and others. I'm absolutely hamstrung in terms of how I can bring you to order on a bill that doesn't appear to offer you the scope to discuss principles. As someone might say, it has no principle. However, all of these matters might be much better addressed in committee stage.

MR. MILLER: Mr. Speaker, if I've established a small precedent in this second reading debate, I'm most pleased. I take your words to heart — the bill has no principle, as the BS fund has no money.

At this point, I will conclude my remarks, as I understand the minister opposite.... I move adjournment of this debate until the next sitting of the House.

Motion approved.

Ministerial Statement

ENVIRONMENT WEEK

HON. MR. STRACHAN: Mr. Speaker, I rise to make a ministerial statement on behalf of my colleague the hon. Minister of Environment (Hon. Mr. Reynolds), who regrettably is in Alberta today visiting, among other places, Egremont and Swan Hills.

Briefly, this ministerial statement deals with the proclamation of Environment Week. I know we're all aware that environmental awareness has been a feature of western society for some years. For a variety of reasons, we obviously now care significantly about our planet — its air, water and soil — and recognize its fragility. Therefore I am pleased to announce that the government of British Columbia has proclaimed the week of June 3 to June 9 inclusive as Environment Week in British Columbia.

MR. ZIRNHELT: I am pleased to respond and to say that this side of the House is glad that the government recognizes that Environment Week is coming up. I'd like to just point out that what we really have to achieve is environment week every week. The great dilemma is whether or not the environment is stable or fragile, which is what we've been debating about the economy. We draw attention every day of the week to the environment, and we encourage members on the other side of the House to do the same.

Hon. Mr. Richmond moved adjournment of the House.

Motion approved.

The House adjourned at 5:53 p.m.