[ Page 12927 ]

CONTENTS

Routine Proceedings

Presenting Petitions –– 12927

Oral Questions

Public Accounts Committee meeting. Mr. Jones –– 12927

Disposition of Peden letter. Mr. Sihota –– 12927

Labour and justice Committee meeting. Mr. Ree –– 12928

Disposition of Peden letter. Mr. Sihota –– 12928

Mr. Clark

Closure of Royal Oak Inn. Mr. Huberts –– 12929

Dismissal of Attorney-General's executive assistant. Mr. Clark –– 12929

Mr. Sihota

Enrolment cuts at Vancouver Community College. Hon. Mr. Dueck –– 12929

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

(Hon. Mr. Jacobsen)

On vote 52: minister's office –– 12930

Hon. Mr. Jacobsen

Ms. Smallwood

Mr. Reid

Mr. Jones

Mr. Lovick

Mr. Rose

Mr. Vander Zalm

Range Amendment Act, 1991 (Bill 5). Committee stage.

(Hon. Mr. Richmond) –– 12955

Mr. Barlee

Mr. Miller

Mr. Zirnhelt

Mr. Vander Zalm

Third reading

Pension Benefits Standards Act (Bill 6). Committee stage.

(Hon. Mr. Rabbitt) –– 12958

Mr. Rose

Ms. Marzari

Mr. Clark

Mr. Vander Zalm

Hon. Mrs. Gran

Mr. Miller

Mr. Smith

Mr. Kempf

Third reading

THURSDAY, JUNE 20, 1991

The House met at 2:05 p.m.

[Mr. Pelton in the chair.]

HON. MR. RICHMOND: In the gallery today we have 53 grades 4 to 6 students from Bert Edwards Elementary School in the great constituency of Kamloops. They are accompanied by their vice-principal, Mr. Bruce Mitchell, and teachers Mr. George Smith and Mrs. Margaret Gallagher. I would like the House to make them most welcome.

MR. REID: In the precincts today we have 56 grade 6 students and teachers and family representatives from Laronde Elementary School in south Surrey. I would hope that the House will make their teacher Mr. John Rogers, all these students and their parents welcome.

MR. HUBERTS: Mr. Speaker, in the gallery today are: a great constituent from Saanich and the Islands, Nancy Klovance; her sister Sheila Jones from Pennsylvania, and Nancy's cousin, Marion Grove, from Burnaby. Would the House please welcome them.

MR. SIHOTA: In the gallery today are two constituents of mine from the riding of Esquimalt–Port Renfrew: Mr. Pritchard from Esquimalt and Mr. Morrow from Langford. Would all members please join me in giving them a warm welcome.

MR. LOENEN: There are a number of guests accompanying our constituent from Richmond, former chair of School District 38, Sylvia Gwozd, together with her daughter Tracy. They have some very special visitors from West Germany: Mr. and Mrs. Gerhard Falk and their son Christian. They are visiting from Braunschweig, West Germany. Would the House please give them a warm welcome.

MS. PULLINGER: Visiting the Legislature today is a constituent and friend of mine, Mr. John Little, with his 90-year-old grandfather from England, Mr. Harry Clark. Would the House help make them welcome.

HON. MR. SAVAGE: On behalf of the second member for Delta and myself, it's a pleasure today to ask the House to welcome a constituent, Inger Kam. Would the House give her a warm welcome.

HON. MR. RABBITT: Mr. Speaker, today a former constituent and a very good friend of mine, Ida Makaro, is visiting our beautiful city of Victoria. I'd like the House to give her a very warm welcome.

HON. S. HAGEN: Mr. Speaker, it's my pleasure today to introduce to the House a former board chairperson of Okanagan College and a present member of the board at the British Columbia Institute of Technology — that world-class organization operating out of Burnaby. Please welcome Mrs. Oona McKinstry to the House this afternoon.

Presenting Petitions

HON. MR. SAVAGE: It's an honour today to rise in this assembly to present a petition relative to Burns Bog. Through a number of presentations that have been made to my office from people involved with the concern for the conservation of Burns Bog and also the concern over the Vancouver landfill site, a lot of people in Delta — I think a lot of people in this House may well have read about this — are concerned about the garbage, etc., being trucked into the Burns Bog location. I think it's important to recognize that the process can easily be changed by processing the garbage along with recycling. This petition relates to a number of concerns about the bog, and I would like to table it.

Oral Questions

PUBLIC ACCOUNTS COMMITTEE MEETING

MR. JONES: Last Monday the Premier gave an undertaking that she would ask members under her leadership to assist in convening the Public Accounts Committee. This morning, after ample notice was given, seven of the 11 members of the committee were absent, and the meeting was unable to proceed. All of those members were from the government side. I ask the Premier why she broke her commitment and allowed members of her side to obstruct the important work of the Public Accounts Committee.

HON. MRS. JOHNSTON: Mr. Speaker, I was not aware until earlier today that there had been a meeting called. Otherwise I would have had an opportunity to talk to my colleagues. But if you would like to give me notice of the next meeting, I will undertake to speak to the members of our caucus serving on the committee.

DISPOSITION OF PEDEN LETTER

MR. SIHOTA: Yesterday the Attorney-General admitted that when first confronted with a letter alleging links between a cabinet colleague and organized crime he dismissed it out of hand as being "without substance." The Attorney-General has also conceded that he had no knowledge of any previous police investigation of this matter at the time he was shown the letter. Can the Attorney-General explain on what basis he concluded that these serious allegations should not be given to the police for their consideration?

HON. MR. FRASER: It is well known now that the letter had quite wide circulation. It is well known now that it was investigated by the police in 1988. It is well known now that it was investigated recently. The member opposite seems to think only lawyers have common sense, and I am here to say that lots of other people have common sense as well. This is one of the few times in memory that a cabinet minister has got in trouble for making the right decision.

MR. SIHOTA: Mr. Walsh has a lot of common sense; he turned it over to the police. The first member for

[ Page 12928 ]

Vancouver–Little Mountain has a lot of common sense; she turned it over to the police. When Brian Smith was Attorney-General, he had a lot of common sense; he turned it over to the police. The current Solicitor-General has a lot of common sense; he turned it over to the police. They had no prior knowledge of any investigation; neither did you, Mr. Minister.

Can you explain why, when no fewer than four cabinet colleagues had previously done their duty by alerting the police, you failed in your duty? Why did you fail in your duty to turn it over to the police, Mr. Minister?

HON. MR. FRASER: I'm well aware that during the last year that member has brought lots of discredit to himself, much to the leader of his party and even more to his whole party.

I'm here to tell you that the decision I made was right, and it has been confirmed by everybody.

MR. SIHOTA: The central issue in this case is the absence of judgment on the part of the Attorney-General.

Let me put it this way to the Attorney-General. Does the Attorney-General not agree that the judgment in question here is not the judgment of Mr. Walsh, but your judgment in a matter pertaining to your colleague? Are you, Mr. Attorney-General, of the view that Mr. Walsh was wrong to go to the police and that you were right not to go to the police?

HON. MR. FRASER: I said yesterday that I had no difficulty with Mr. Walsh taking the document to CLEU. I've said that, and I have no problem with it. That's normal procedure for an executive assistant, anyway. Had something turned up, he would have undoubtedly advised me. Notwithstanding that, the discredit you tried to bring to this system is disgraceful. It's you who should resign.

[2:15]

LABOUR AND JUSTICE
COMMITTEE MEETING

MR. REE: The Premier has said she will assist on having members of the government side attend committee meetings in the future. Will she also assist members of the opposition? We had a Labour and Justice Committee meeting here this morning, and only the member for Esquimalt–Port Renfrew showed up — just for a few moments, and he did not stay for the business part of the meeting. Will the Premier please assist us to have members of the opposition attend committee meetings in the future?

DEPUTY SPEAKER: Order, please. I would like to advise all hon. members for future reference that matters involving committee work should not be brought into this chamber.

DISPOSITION OF PEDEN LETTER

MR. SIHOTA: Again to the Attorney-General of British Columbia. Two days ago the Attorney-General indicated publicly that he never made a move in his office without discussing it with his officials. In this case he never discussed the letter, its contents or the appropriate procedure with those officials. The Premier herself has expressed surprise that you failed to research this matter before you simply dismissed the alleged link between organized crime and one of your cabinet colleagues. She says that's a good question. Would the Attorney-General care to tell this House why, in this of all instances, he felt no research and no referral to his officials were necessary?

HON. MR. MESSMER: I think that I should answer to the member opposite. He said that I had sent the letter over to CLEU to have it investigated. That is not correct. When the question was asked in the House of the Attorney-General, he was asked if there was a compromise of the integrity of the CLEU investigation into organized crime. Because that comes under my ministry, I went back to my office and asked if they would check with CLEU to find out what happened. The answer I got was that the police had investigated this thoroughly, and they found there was nothing of substance.

HON. MR. FRASER: May I add to that, Mr. Speaker? There's no question about the judgment I made: it was judged to be correct by everybody. It's me that understands justice in this House much better than you, Mr. Member for Esquimalt–Port Renfrew.

MR. CLARK: Another question to the Attorney-General. It has been confirmed that the person to whom the letter was disclosed was Mr. Kelly Reichert, the assistant to the second member for Kamloops. Did Mr. Reichert discuss the contents of this letter with anyone other than Mr. Bob Edwards?

HON. MR. FRASER: That is impossible for me to answer. How could I possibly know?

MR. CLARK: Is the Attorney-General saying that there was no investigation as to where Mr. Reichert got his information?

HON. MR. FRASER: The member asked me a minute ago if I knew who Mr. Reichert or anybody else had spoken to. There's no possible way I could know. What you do know is that the information was taken to the deputy minister; it was examined; and that's how it all came to me. That's when I took the action of firing my executive assistant. That's what I should have done.

MR. CLARK: Is the Attorney-General confident that Mr. Reichert did not tip off any Socred MLAs named in the letter alleging Socred-Mafia links?

HON. MR. FRASER: The Ministry of Attorney-General and the justice system of British Columbia have

[ Page 12929 ]

been through a number of reviews in the last year. All reviews — by Mr. Hughes, by Mr. Owen — have shown the system to be operating as it should: professionally, efficiently and with justice for all. That's the way it's going to stay, as long as I'm the Attorney-General of this province.

CLOSURE OF ROYAL OAK INN

MR. HUBERTS: A question to the Minister of Labour regarding the Royal Oak Inn. In 1988 the Royal Oak Inn changed ownership when an international group purchased it. At that time the employees were assured their jobs were secure. As late as three weeks ago there was a meeting, and they were told that their jobs would be secure. Last Wednesday they arrived at the Royal Oak Inn and suddenly their jobs had been terminated. Will the minister please investigate what wage protection is available to the former employees of the Royal Oak Inn?

HON. MR. RABBITT: The Royal Oak Inn, as I understand it, is represented by a trade union, the BCGEU, and in our province the first obligation to recover lost wages is that of the union. In the event that the union cannot recover those lost wages, then the government, through my ministry, through the employment standards branch, will do whatever is necessary to recover those wages.

DISMISSAL OF ATTORNEY-GENERAL'S
EXECUTIVE ASSISTANT

MR. CLARK: To the Attorney-General. If Mr. Walsh's actions were grounds for dismissal, does the Attorney-General think it proper for Mr. Reichert, the longtime assistant to the former Attorney-General, to have approached Mr. Walsh to inquire into the contents of the letter alleging Socred-Mafia links?

HON. MR. FRASER: Mr. Speaker, there's no possible way that anybody could answer a question as wide-open as that. I have no idea who Mr. Reichert or Mr. Walsh talk with. How could I? I don't know who you talk with, either. Try to ask a question that makes some sense here.

MR. CLARK: Mr. Attorney-General, you have an obligation to get to the bottom of this. You're the chief law enforcement officer. You're in charge of the justice system in this province. You have fired someone on the basis of confidentiality breaches.

Mr. Reichert appears to have information on which he based his allegations. Inasmuch as it appears Mr. Reichert had knowledge of the allegations regarding Socred-Mafia links when he approached Mr. Walsh, has the Attorney-General determined how Mr. Reichert learned of the allegations?

HON. MR. FRASER: Mr. Speaker and members of the House and all you watching on television, what is done has been done right. The information was found to be groundless; it's been found to be groundless by the RCMP, by the ministry, been investigated by everyone. The decision I made was right, and I stay with it.

MR. SIHOTA: If that is the case, Mr. Attorney-General, and if you are unsure of what Mr. Reichert did with that information, and if you deny that Mr. Edwards did not look into this matter.... And I will suggest to you that Mr. Edwards did, and put forward evidence saying what Mr. Reichert did with the information. If you disagree with the positions that I've just outlined, then do the honourable thing and table before this House the Edwards investigation into this internal matter.

HON. MR. FRASER: Mr. Speaker, as usual the member opposite tries to twist the story. What I said yesterday was that it had gone to Mr. Edwards. He had investigated it; he brought it to me. That's how the whole thing came about. It has been done right, expeditiously and well.

MR. SIHOTA: You didn't take it to Mr. Edwards. Let me ask you one simple question, Mr. Minister: do you know what Mr. Reichert did with the information once he received it?

HON. MR. FRASER: Mr. Speaker, how could anybody know the answer to that question? It's a ridiculous question meant to distort the story. Now the story is wrong, now the information is found to be groundless, so we're trying to go around some other way. What was done was done right, well and expeditiously.

MR. SIHOTA: I'll tell the Attorney-General what he tried to do: he tried to protect the backside of one of his Social Credit colleagues, and he's trying to do that right now. You know, and I know, Mr. Attorney, that Mr. Edwards inquired into this matter.

I have a question for the Premier. Can the Premier assure the House that she did not put any pressure on the Attorney-General to fire Bob Walsh because of concerns she had about leaks regarding the legal opinion she obtained with respect to the former Minister of Finance?

HON. MRS. JOHNSTON: Mr. Speaker, no.

MR. DAVIDSON: Mr. Speaker, in accordance with the provisions of notice on matters of privilege, I rise to give such notice on matters involving myself, the internal audit department of the Ministry of Finance and the B.C. Hazardous Waste Management Corporation.

ENROLMENT CUTS AT
VANCOUVER COMMUNITY COLLEGE

HON. MR. DUECK: Mr. Speaker, on Monday the hon. member for Burnaby North asked a question concerning the status of the budget of Vancouver Community College, and he suggested that significant cutbacks in both programs and staff at VCC were

[ Page 12930 ]

contemplated. I advised the hon. member that discussions were taking place concurrently with his question and that I would bring back an answer at a later date.

I am very pleased to advise that Vancouver Community College will provide the level of programs that it had requested in its budget submission to my ministry. Some details are still being worked out by VCC officials and will be considered at VCC's board-of-directors meeting this evening. The satisfactory solution to VCC's challenge of delivering its programs was possible only with the creativity and goodwill of the college board, administration and faculty unions at VCC, and officials of my ministry.

Orders of the Day

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

ESTIMATES: MINISTRY OF
SOCIAL SERVICES AND HOUSING

On vote 52: minister's office, $337,553.

HON. MR. JACOBSEN: Mr. Chairman, it's my pleasure to present to you today the expenditure plan for the Ministry of Social Services and Housing for the fiscal year 1991-92. My ministry is perhaps unique among ministries, in that when the economy is active and robust, the ministry's need for financial resources decreases. But when the economy is sluggish, its requirement for funds increases.

North America has experienced a period of reduced economic activity. British Columbians have not been as seriously affected as other provinces. However, we have not entirely escaped the downturn, and it is precisely during such times as these that the social safety net must be maintained. My ministry's program and services are essential elements of that safety net.

Mr. Chairman, the mission of my ministry is to help people in times of need. We do this with careful financial management, efficient administration and quality service delivery. My ministry's total budget allocation of $1.98 billion is almost 16 percent larger than it was in 1990-91. Much of this increased funding is required to provide income assistance to increasing numbers of individuals and families who need our help to see them through tough financial times and to assist them to gain financial independence through employment.

Income assistance caseloads grow during dips in the business cycle. This is nothing new. However, this time the federal government's recent changes to the unemployment insurance regulations have forced onto income assistance many people who formerly would have been eligible for unemployment insurance benefits.

[2:30]

Income support is only part of our work. The ministry is responsible for protecting children from abuse and neglect. It supports and strengthens families. It provides housing for families, seniors and people with disabilities, and it assists people with mental handicaps to participate as fully as possible in their communities.

In response to rapidly increasing income assistance caseloads, my ministry has recently introduced a range of new initiatives to assist recipients in getting back to the workforce as quickly as possible.

We do not wish to create welfare dependency; we want to help people who are able to work to work. I recently wrote to 60,300 singles, couples and two-parent families who are employable to tell them that there are additional services available to them. I want to make it clear that the letter about the new services was sent only to single people, couples and two-parent families classified as employable. These are the groups who are most able to find work at this time of the year. It was not sent to single-parent families, as we recognize that their needs may be different. It was not sent to seniors. It was not sent to people with disabilities, as I am sure we all agree that we have a responsibility to support those who are unable to support themselves.

There is no doubt that it is a challenge to find employment when the economy is sluggish. At times like this, all opportunities must be available to those who are ready and able to work. Staff has been added to work intensively with income assistance recipients to help them back into the workforce.

Our budget for income support has been increased this year by $233 million. Welfare payment costs are cost-shared equally by the province and the federal government. Unfortunately, this cost-sharing is at risk because of the federal government's unilateral decision to limit Canada Assistance Plan contributions for British Columbia, Ontario and Alberta. In order to maintain the purchasing power of persons forced to rely upon income assistance, the ministry's 1991-92 budget includes an increase of $19 million to enhance rates and benefits.

British Columbia is widely recognized as a leader in the placement of people with mental handicaps from institutions to community living. Almost 3,500 adults with mental handicaps are now living in government-funded residences in communities throughout the province. In the ministry's plans for those who remain in institutions for people with mental handicaps, the best interests of the individuals and their families are of paramount consideration.

In January the ministry worked with the Ministry of Health and distributed a discussion paper "Planning for the Future," a proposal for community services to people with mental handicaps. It is being used for a major public consultation to establish future direction for the provision of services to adults with a mental handicap. The development and delivery of services to these British Columbians is achieved through a partnership between the government and the community. My ministry will increase its budget allocation for community support services this year. The total budget increase for programs for mentally handicapped adults will be over $25 million.

I have just announced two important initiatives to assist individuals with mental handicaps to participate as fully as possible within their communities. The first of these is the adoption of a set of a operating

[ Page 12931 ]

principles to guide ministry staff in dealing with all those who provide care for persons with mental handicaps. The principles were developed by a provincial advisory committee. This is a very good example of our partnership with the community in dealing with an issue of mutual concern.

Even with the adoption of the operating principles, I know there will be situations that require the intervention of someone who is independent of the day-to-day ministry operations. For this reason, I am very pleased to tell you that we will be appointing a service-quality advocate for persons with mental handicaps and their families. The advocate will operate with a large degree of independence to monitor service planning, problem-solving and conflict resolution, and will make specific recommendations for service-quality improvements. The advocate will report directly to the minister.

The ministry, in partnership with the federal government, local governments and housing societies, is continuing to produce as much social housing as possible to serve those in greatest need. In partnership with the federal government, the ministry, through the B.C. Housing Management Commission, has developed almost 10,000 housing units since 1986. The focus of our social housing efforts this year will be families with children, seniors and persons with disabilities.

I am especially concerned about rental housing for low-income-earners and about obstacles to home-ownership for would-be purchasers. Low-income-earners, especially employed single parents, are having a particularly hard time finding affordable accommodation in a rental market that has improved but still has low vacancy rates and rising rents. We must find more effective ways to ensure that people who are working very hard to maintain their independence are adequately housed. I can tell this House that a number of program options are under consideration, and an announcement will be made in the near future.

This government believes that all people, especially young people, who wish to own their own home should be able to do so. I want to assist young people to move from rental accommodations to a home of their own. While I am not today announcing new initiatives for first-time homebuyers, we are determined to find workable solutions to the problems faced by those purchasing that first home.

One of the most important responsibilities of my ministry is to protect children from abuse and neglect. We are all terribly aware of the tragic consequences of child abuse. My ministry and its staff are committed to the effective coordination of resources across all ministries involving families and children. The new child and youth secretariat is a welcome initiative in this direction. On June 3 the Premier and I signed a proclamation which set out the fundamental elements of a child policy for British Columbia. The policy will be a framework for communities, organizations and governments to work together to ensure the best possible environment for children and their families.

As I announced earlier, the first initiative my ministry will introduce within the framework of the new children's policy will be a comprehensive review of our child protection legislation. I believe that this is timely and very important. The Family and Child Service Act has served us well. However, the problems we face today are very different from those a decade ago. We will be consulting widely with individuals, groups and communities as we prepare to update that legislation.

As this House knows, we have amended legislation to establish an active adoption registry. I believe it is a fundamental right of all people to know about their origins. Thousands of people have been denied this information, and I want to tell you that I'm extremely pleased that we will be making that information available. The registry will respect the right to confidentiality to ensure that no information is released and no one is contacted without consent of the persons affected.

I support the desire of native people to play a more direct role in designing and providing family and children services to their own people. Progress has been very substantial in this area and will continue, so that services will reflect and respect the unique cultural heritage of native people.

The ministry believes that the family unit must be strong and viable and that families under stress must be supported. The safety and well-being of children is paramount. But any intervention with families must be appropriate and must respect the rights of individuals. Consistent with these beliefs, the ministry has developed standards of practice to guide social workers in child abuse investigations. Standards for residential care are also being developed.

Mr. Chairman, I would like to take a moment to pay tribute to a very special group of people — foster families. Foster families have been our first choice as a home when children must come into the care of the ministry. The commitment and dedication they have provided for many years are truly outstanding. My ministry has worked with the British Columbia Federation of Foster Parent Associations to enhance our support, training, payment and structure for foster families. I will be making an announcement later about a new rate structure and payment increases.

The family of today is very different in many ways from the family of only a few years ago. Today there are many single-parent families, most of them headed by women, as well as an increasing number of two-parent families with young children with both parents employed. This year the day care budget has been increased to help low-income working parents. Day care subsidies are an important support for income assistance recipients. It assists them to train and gain work experience so that they too will have the opportunity to move towards independence.

My ministry has budgeted $52.89 million to child day care. The Ministry of Women's Programs and Government Services and Minister Responsible for Families complement my ministry's role in the day care picture. An additional $12.1 million has been made available to enhance the day care program.

The family maintenance program assists income assistance recipients to receive spousal support for child maintenance when they are entitled to it. Spouses

[ Page 12932 ]

have a responsibility to support their dependents. Receiving a regular maintenance cheque can often be the first step to independence for a single parent. Family maintenance services have helped thousands of lone parents to obtain financial support from their estranged spouses and thereby to become independent of government financial support. Last year over $6.85 million was court-ordered to income assistance recipients. The call for this service has been so great that we have been unable to meet the demand. The 1991-92 budget will allow us to add 37 new family maintenance workers.

In closing, I want to emphasize the fact that working in partnership with others is the fundamental way in which the ministry goes about fulfilling its responsibility to people in need. Our partners are many, and they are varied — from several thousand contracted service providers to organizations such as the Downtown Eastside Residents' Association, the B.C. Association for Community Living, native tribal and band councils, federal and local governments and many more. Their work is invaluable, and their support for the work of my ministry is beyond measure. It is much appreciated.

Finally, I would like to acknowledge the contribution of my ministry staff. Much of their work is extremely demanding. Ministry staff provide services to people who are often in highly stressful situations. Being a child protection worker is not a job that one can easily leave at the end of the day. Other staff deal with similar difficult challenges and decisions daily. There are those who would criticize the work of the ministry staff. It is easy to sit back, I suppose, and criticize. However, situations are seldom as clear and as simple as our critics would suggest. I know that. I also recognize how difficult and demanding the work is, and how well the staff of my ministry perform their duties. I hope that all members of this House feel as thankful as I do for the dedication and service of the staff of this ministry.

[2:45]

MS. SMALLWOOD: I think it's appropriate that I start by picking up where the minister left off and by adding my support and appreciation for the work that the staff in the Ministry of Social Services does not only here in Victoria but in each and every community in the province.

For anyone who has had to deal with issues surrounding the Ministry of Social Services, it is increasingly clear that they are very special people dealing with very difficult and very unfortunate situations throughout the province. The thing that is striking, I believe, is that for most of the policies that have come from this government and from previous Social Credit governments, while the words are there in appreciation of that work, the reality is that the caseloads have continued to increase and the support has not been there for the work they do.

So for all of the good words, I think it's important that we take the next step and recognize that it has to be followed through by practical and tangible actions from the government.

In the estimates of Social Services I'd like to talk about a number of different issues. It's clear that with the Ministry of Social Services being as large as it is and the scope of issues being as broad as it is, it is impossible to touch on all issues or do credit to many major issues that need to be debated in this House. Having said that, I have chosen a few areas to focus on, with the hope that they might continue to indicate where the New Democrats are coming from and the kind of work that we would like to do to improve the situation in the province, and on behalf of our constituents, to hold this government accountable for its policies.

What I'd like to lay out in the beginning are some of those areas of concern. Before moving into talking about family and children's services and the policies of this government on children in this province, I'd like to emphasize that a number of the situations families face in dealing with the Ministry of Social Services first and foremost have to do with poverty, and that a number of the issues families face in this province could be alleviated. A fair degree of the crisis the minister referred to could be disposed of if people had the ability to feed, house and care for their children in a dignified manner.

This government spends an awful lot of money. This is the third-biggest ministry. It's very clear that the answer is not necessarily more money from government but more practicable policies, more accounting, more clarity in the goals the government hopes to achieve with the money they spend. The government indicates that the budget in Social Services has increased over the years, and this year is no exception.

The government also talks about the role of the ministry being one of serving people in need. As you go through the policies and the realities of the lives of the people this ministry affects, it's ironic that in some ways Social Credit policies are creating the very need that they are, by their stated policies, addressing. The fact that they have cut prevention programs, cut family service programs — the programs that help families deal with situations before they become crises — is the very indication that they have in some ways created that need that they are now servicing. I would argue that providing support — whether it's child care workers, child workers associated with schools or sexual abuse teams — is considerably less expensive than dealing with crisis intervention. This government's cutbacks and narrow-minded view of their responsibilities have created a need within families in this province that is now up to three times more expensive for taxpayers to deal with.

In his introduction the minister talked about the policy dealing with foster parents — the rate structure and payment increases. There are families in this province that have to make a decision whether or not they will keep their children. If they had the support of this government to provide for those children, they wouldn't have to give those kids up, and you wouldn't have to pay foster parents up to three times as much as that kid is worth on welfare to the mother.

When we are dealing with policies associated with children and families in this province, it doesn't

[ Page 12933 ]

necessarily mean more money. What it does mean is money spent well, having your goals clear and having very clear standards and regulations for children that, unfortunately, have no other alternative but to be in care. What we've seen through this government's ideological bent is the privatizing of services — turning the care and delivery of a number of services over to the private sector. Because of that ideological bent towards the private sector, we have seen a tremendous amount of taxpayers' dollars — and we'll talk about that later — not accurately accounted for and the goals I hold important not fulfilled.

We'll talk about the ombudsman's report and his reference to the lack of consistent standards, regulations and licensing — another area where we'll talk about effective spending of taxpayers' dollars.

It is clear that there will always be children and individuals in this province that need some assistance. What is also clear is that government is failing those people and the taxpayers, because taxpayers believe that they are paying tax dollars to ensure a certain standard within our society, a mutual and collective agreement that we should not see children remain in harmful situations, not see families broken up unnecessarily. We will indicate through the estimates that the government has failed.

I want to talk about youth services. We'll refer to the reality of young people in this province, government policy, counselling for victims of child abuse, services to handicapped and disabled people, and the issues of concern to native people as well — just as a bit of an indicator of where I hope to go with the estimates so that your staff, Mr. Minister, can prepare to deal with that.

I'd like to start with the broader, perhaps more philosophical issues, such as the relationship of the ministry...issues around poverty and how they fit with the rest of the cabinet. I'll start by asking the minister whether or not his ministry is formally a component of an economic strategy for this province?

HON. MR. JACOBSEN: Let me say that anyone who serves in the cabinet in this government and is responsible for a budget that is close to $2 billion is certainly part of the economic strategy of this province. We recognize very well that in order to provide the services that are required in this province by many people — and many of those are children — the first requirement is that we have something to give. The way we get something to give is by having an economy that's strong enough to produce enough wealth that we're able to look after those people in need. So yes, let me say that this minister — and, I think, each of the ministers — is part of the economic strategy for British Columbia.

I think that the opening remarks of the member opposite were certainly politically oriented remarks. Obviously we will not agree on the conclusions, because we see things from a different perspective. The member takes care to say that we do not necessarily need to spend more money, but we need to spend it better. The record of the member opposite and of those who belong in the same philosophy for spending money is not particularly good. I don't know that it's appropriate for them to set themselves up as examples.

MS. SMALLWOOD: Point of order. I believe the minister just impugned me personally by making a reference to my ability to manage money. I am not a member of the government, and I'd like the member either to be more specific or withdraw that.

MR. CHAIRMAN: I am sure the minister will withdraw any indication of intent to impugn the hon. member's integrity.

HON. MR. JACOBSEN: Mr. Chairman, I have no intention of impugning the member opposite. That's not even what I said. What I said is that the philosophy of the members opposite, and the record of that philosophy for controlling expenditure, is not very good. I think we can offer evidence of that.

The difference, of course, is how we will deliver that service. We deliver the service through participation of the private sector. We make no apologies for that, and while I don't expect that we will agree on this, I have no trouble in believing, understanding and knowing that that is the most efficient way to do it.

Now the suggestion obviously is that the service would be better provided were it not provided through the private sector, but if it's to be provided and not through the private sector, that automatically means it would be provided directly by government. Perhaps there's an interest of the members opposite to have the government providing the service directly. But let's not confuse that interest with a cost saving for the people of British Columbia or better service. In fact, it will not be. It will have quite the opposite impact in both cases.

MS. SMALLWOOD: I'm continually surprised — and you'd think that after five years there wouldn't be another surprise coming from that side. The fact is that we have significant issues to deal with around the care and responsibility for children. Not only in this province but, indeed, across Canada they are facing a crisis.

It is clear to me that the old ways of old governments such as yours have not worked. It is clear to me and many others that it is going to take some creative thinking and the use of options and alternatives to begin to be able to meet the needs of those children and families. The minister digging in and talking about old ideologies is not helping anybody.

[3:00]

I'd like to address two issues. One is the issue of an economic strategy. It is clear that when we are talking about real options to eradicate poverty in this province, we must look at putting the heads of strategic ministries together at a table to begin to deal with the needs of labour, the labour market in this province and economic development issues.

When we are talking about a pool of unemployed in this province, band-aid solutions, such as the sorts of programs that your government has brought in over the last number of years, have not worked. They have not been a strategic component, and you have not provided real opportunities for these people — six-

[ Page 12934 ]

month jobs and back on welfare. I think it's very clear that there's a long and well-documented history that those programs have failed. They have not addressed the real needs of people who rely on income assistance. It's about time that you looked at people's needs and the province's needs in a more realistic fashion. Pointing to the fact that everyone in cabinet is responsible for economic strategy, and the virtue of the amount of money your ministry spends as an indicator of fulfilling your responsibility to those people on welfare, just points out the fact that you have not given it the kind of thinking that is clearly necessary.

I've done this for the last couple of years, but we'll go through it again because I know the minister is somewhat new to the post. The fact is that the people on welfare.... When you look at who relies on income assistance in this province, it's pretty predictable. They are women with children. When you look at the economic reality in this province and at the need for government intervention — and I've said that word — and when you look at the fact that children are supported by single-parent, woman-led families, the reality is that the government has a role and can intervene. It can intervene on affirmative action programs — other jurisdictions have done so. It can intervene on pay equity programs — other jurisdictions are leading the way. The fact of the matter is that women earn 60-cent dollars, are disproportionately represented in part-time jobs in an involuntary capacity and don't have pensions to rely on. Well, of course, they're going to be poor and are going to have to rely on welfare. There are things that you can do by representing those women and the taxpayers who pay for those welfare cheques in a round table with the strategic ministries of your government, to look at real options and things that you can do with the government apparatus to try to eradicate the poverty that is facing those women.

[Mr. De Jong in the chair.]

The fact that people who are disabled are disproportionately poor in this province, and that by virtue of their disability can pretty much rely on poverty at some point in their lives, has everything to do with government inaction. Other jurisdictions have looked at affirmative action programs and support for the disabled, to enable them to live productive lives in the workforce. Those people want to work, and they all have something to give. We've seen nothing but punitive letters and punitive policies.

Another group you can look at who are disproportionately represented on welfare are visible minorities, particularly native people. New Democrats on this side of the House have talked about policies that will empower groups like native people in this province to take control over their own destiny, to get on to living productive lives and to being fully employed, because that's what they're after as well. They want some control over their own destiny, and your government could do something about that.

When I talk about an economic strategy and your role in that, Mr. Minister, it is not simply by virtue of you filling a chair at the cabinet table or by virtue of the amount of money your ministry spends. I would agree that welfare recipients spend their meagre dollars in their communities, and there are direct economic spinoffs. It's not welfare people who are shopping across the border, because they're spending their money in the grocery stores — the very little money that they get — right there in their communities. A number of them don't even have the ability to get across the border.

It's more than the direct spinoff from tax dollars going into communities to pay for social services or for welfare; it's recognizing who is on welfare, and that a number of those people on welfare are there by virtue of the group they fall into — women, disabled, visible minorities and one recognized by a predecessor of yours: men over the age of 50 who have become technologically redundant, and who have been laid off and no longer have a job to go to. Ever since the government announced that recognition, I'm looking for policies to address that, and I see none. Have you written those men off? Well, their families still need them. Their families are still counting on them to pay the rent and often, at that stage, to see their kids through high school or university. Those men come into my office, and I have to tell you, Mr. Minister, it's quite an experience when you get a 55-year-old man in tears in your office telling you that he never thought he would have to rely on welfare. They have worked all their lives, paid their taxes and paid for all of the programs they now are having to take advantage of, while feeling absolutely devastated by the reality they're having to face.

I don't see anything coming from your government, other than punitive letters telling them that you expect them to get out and work. Well, the reality is that your government doesn't seem to be able or willing to open their eyes to the few basic realities of those who rely on those safety nets or to develop programs in consultation with other ministries in order to ensure real options for those people.

We have a group in this province, and they call themselves End Legislated Poverty. That's what it means when they're talking about the poverty in this province: governments have failed to legislate real options and real solutions to eradicate the poverty that many of those people are facing through no fault of their own.

The minister went on to talk about an ideological difference between your government and this side on the issue of privatization, and your commitment to the private sector for delivering social services in this province. You make a quantum leap by assuming that I am arguing for the delivery of services to be done solely by government. Those were not my words. By making that leap, the minister failed to deal with the fact that by privatizing a number of those services, you've only done half the job. That hands-off-responsibility attitude of this government, where you just shovel the taxpayers' dollars into the pockets of the private sector without any strings attached or any quality control, regulations, standards or the ability to police.... The minister shakes his head.

[ Page 12935 ]

We will talk about the quotes from the ombudsman's report referring to the need to standardize regulations and their enforcement. In any other sector, who ever heard of turning a statutory responsibility over to another group to administer and then not putting in place in the most minimal way a structure that can hold accountable the group you have given the responsibility to? Without the understanding written down in contracts — and repeated not only in the ombudsman's report but in the auditor-general's report as well.... Again and again, year after year, we hear quotes that the goals of the programs and contracts are not spelled out, so the auditor-general is not able to assess whether or not tax dollars are being spent in ways that assure people that their money is being spent well. Again and again — because the goals are not spelled out and the standards are not uniformly enforced, because the people aren't in the field, because they're overworked — checks and visits are not being done.

The ombudsman's report refers to different institutions and group homes in the province where children's safety and health have been at risk, because the handling of children's services has been spread out through so many ministries that one hand doesn't know what the other is doing. That is the result of privatization. That is the result of you not fulfilling your responsibility to the children and taxpayers of this province. Fine — have those individual group homes deliver the service but, as a minimum, ensure that you have in place standards and regulations and the ability to enforce them. Without that accountability, without fulfilling your responsibility, you are neglecting both the children and the taxpayers in this province.

When I talk about spending money more effectively, more efficiently and more accountably, that's precisely what I'm talking about: knowing that every single dollar of taxpayers' money being spent in the care and delivery of service is being well spent and accounted for, and that those people that you are responsible for are getting a certain standard of care, and that people in this province can be assured that the children you do take from crisis situations are not ending up in situations that are as bad, if not worse, because of your neglect.

You referred earlier to the secretariat around children's services and around the....

MR. CHAIRMAN: I'm sorry, hon. member. I must inform you that your time has expired.

MR. BARLEE: Mr. Chairman, I would like to hear more from the member. I'm finding it very interesting indeed.

MS. SMALLWOOD: I'll finish my question to the minister. In the Health estimates we asked some questions about children. The minister's excuse for not dealing with some of that interministerial coordination was the child and youth secretariat. You have had notice from the ombudsman, and to my mind, setting up the secretariat does not relinquish your ministry from the responsibility of trying to deal with some of those issues. I'd like to hear from the minister about his ministry's involvement with the secretariat, its progress, and what he is doing to deal directly with some of the responsibilities flowing from the ombudsman's report.

[3:15]

HON. MR. JACOBSEN: Mr. Chairman, I get up to respond rather reluctantly. I don't know whether we're supposed to participate in this type of dialogue. Is this what estimates are all about? I thought it was so that the people of the province, if they're interested and watching.... I know that most of them are out working; they haven't got time to be paying attention to what we're doing. But there are some people who are concerned with what we do in government, so I thought that those who are interested, at least by this process of going through estimates, would at the end of the day have some understanding of the programs offered by government, the services provided, and the viewpoints of the members opposite on how those programs might be improved or on some things we might do a little bit differently. I thought it would be a dialogue that at least dealt with facts. Obviously there are political statements that have no bearing on reality, so I don't know that there's any need for us to begin to try to even respond.

We're accused of not having creative thinking. Well, what is creative thinking? The member opposite didn't say, but I suppose the province of Ontario has creative thinking when it comes to social assistance and social services. The whole of Canada is watching to see the outcome of that particular example of creative thinking. I wonder if that's what is meant.

We're accused of not caring about women who are dependent upon social assistance and of doing anything to help those people better themselves. Well, the member opposite is the critic. I assume, as the critic, you know some of the things that go on within the ministry. Right today there are thousands of women in this province benefiting from programs that we have set up to help women on social assistance find their way out of it. For your information, if you haven't seen it before — it's information that's available — in 1991 there were the following women participating in our programs: counselling, 1,800; training and education, 14,000; work experience programs, 500; wage subsidy programs, 3,900; job search support, 3,000. Many of these women are very pleased with the support they have received from the ministry; they have gone on to become financially independent. They have done very well. I understand the struggle they go through. It's not an easy process for anyone, but they have done it successfully. So the help we offered must be of value, because we have many success stories. We could stand here and say that the government provides no support for those people. But we are not dealing with reality. The fact is that there is a lot of support, and many people have benefited from it. They have taken advantage of it, and they have been successful.

My ministry is very much involved in the use of the secretariat. The assistant deputy minister, the chairman

[ Page 12936 ]

of the secretariat, is the member from my ministry. As chairman, he, along with the other ministries that are involved, have been working over a period of time, and their work is progressing very well. They are very pleased with what has been accomplished within the secretariat.

MR. REID: I appreciate the responses to the concerns around women and some of the women's problems relative to the Social Services department. I attended a meeting last night in my constituency with a special-needs mentally handicapped group. They made a position to me on the Employment Plus program — how it affects them and how we can, through your ministry, expand the program to cover the employables within the mentally handicapped community who have limited experience and limited abilities but are willing and able to work in some of the employment opportunities in the community. But it appears, through our programs which we provide.... I'm not being critical about the programs you do provide, Mr. Minister. I was hoping that maybe there was some way that we could expand those programs a little to cover that special-needs community, as it equates to the mentally handicapped.

HON. MR. JACOBSEN: Mr. Chairman, we have a number of programs through Employment Plus, as you know, and there are many handicapped people who participate in those programs and take advantage of them. I have had the pleasure of going to different projects and meeting some of the participants. I can tell you that the program has been very successful. People are allowed to participate to the degree that their ability will allow. But for all of them, the very fact that they are able to participate in something that is meaningful and creates something they can see is very important for their emotional well-being. So the program is successful. It is an area where we're very mindful that support is needed, because often there isn't private employment available.

MR. REID: Mr. Minister, I'm pleased to hear that because reference was made specifically last evening to the community workshops, programs which our special-needs participants.... The mention was that if they were over 19 years of age, for some reason or other part of our program does not cover those special-needs people. Is that correct, or is this group that I spoke to last night not current on what the program does?

HON. MR. JACOBSEN: The information I have is that it does not cut off. These people are employed through achievement centre programs — that would be like the workshops — self-help skill programs, support work placement programs and the employment initiative for the handicapped employment program. I'm told that the assistance is available to the mentally handicapped over the age of 19.

MR. REID: Obviously the group.... I didn't have the answers at my fingertips, because of the kinds of expanded programs you have. So I will certainly convey that information today.

Mr. Minister, I'm interested in the comparison between what your ministry provides in the province of British Columbia and what Ontario currently provides relative to budget funding for Social Services.

HON. MR. JACOBSEN: Mr. Chairman, the member will have to bear with me for a moment on that last request, because the numbers change so often that we have a hard time keeping up with them. But we will try to get you the current numbers.

As for your earlier question, it would be worth knowing exactly which program the people who had the concern were participating in. It might have been a program that was exclusively designed for children, but we certainly have programs that employ the mentally handicapped when they become adults.

MR. REID: Mr. Minister, in order to clarify that, I will get some further answers from your staff. But the particular program I was talking about and the people who I was visiting with last night.... We're dealing with a large age factor from 13 to 50 or 55. So there certainly was a wide range, and it was a community workshop.

What had concerned me most, when it came up and was relayed to me, was that this organization, which operates a non-profit society in order to raise funds to do the expanded things they want to do for these special-needs people, were subsidizing, it appeared, some of these clients who were able to go out into the community and do some limited amounts of work. They were able to subsidize them until they ran out of subsidy funds, and then they had to call the employees back because they were not dovetailed into Employment Plus. For whatever reason, they thought it was not possible for them to apply.

So I will follow that up today, because it sounds by your explanation that they haven't pursued it far enough. I wasn't able to give them the answers last night, but I will pursue further with them the programs you have available.

HON. MR. JACOBSEN: I thank the member, Mr. Chairman, and look forward to hearing from him so we can answer the case directly.

The comparison for British Columbia and Ontario in the percentage of the population on income assistance is: in B.C. it is 7.7 percent, and in Ontario it's 9.5 percent. The caseload increase over last year in British Columbia was 14.9 percent; in Ontario it was 40.4 percent. The 1989-90 income assistance expenditures in B.C. — this is '89-90; bear that in mind — was $886 million; in Ontario it was $2.5 billion.

MS. SMALLWOOD: I have a very quick question to ask the minister. I'd like to read something and ask you whether you agree with it: "Governments (federal, provincial and local) provide welfare payments and unemployment cheques to millions of people who produce nothing. In other words, in reality they enjoy free consumption of goods and services produced by

[ Page 12937 ]

others." Could the minister tell me whether he agrees with that statement?

HON. MR. JACOBSEN: Can I have the very first part of the question again?

MS. SMALLWOOD: I'd just like to know if the minister agrees with this statement and whether he believes it is a reflection of his government's view. The statement is: "Governments (federal, provincial and local) provide welfare payments and unemployment cheques to millions of people who produce nothing. In other words, in reality they enjoy free consumption of goods and services produced by others."

HON. MR. JACOBSEN: Mr. Chairman, obviously the question asked by the member is intended to lead someplace else. If your answer is to be a criticism of people on social assistance then I think you have to understand that I do not support the view you're taking. I suppose that anyone on social assistance at a particular moment in their life is maybe not able to produce something that other people would use in society — if that's what you're looking at. But that's not their fault at that point. They need help at that point. And if we can treat them in the right way, then they will be able to go into the workforce and be productive members of society, which the vast majority of them certainly want to be.

MS. SMALLWOOD: Before I go on with this particular statement, I want to ask the minister — and I won't pursue it any further — to look at your response when the Blues come out, because one of the things you said was that people on welfare, through no fault of their own, need help. I believe your words were: "If they don't produce anything that anyone else can use...." And you went on from there. So even though you are offended by this statement — as I am — there is a thread that runs through even your mind, sir, that people on welfare are not being productive. And I think that one of the fundamental things we must come to realize is that people on welfare, those families raising children, those women whom you, through your policies, are forcing into the labour market, are by virtue of the work they do contributing to society by raising their families. They are doing worthwhile work.

[3:30]

The statement I read to you, Mr. Minister — and I am going to ask for your help in this, and I am glad that other members in the House were offended by the statement, because I'm going to ask for help from them as well — comes from a textbook. It comes from the grade 12 consumer ed class, a compulsory course in this school system. I want you to think about what it feels like to kids in this province in grade 12 who may be at school trying to get their grade 12 education so that they can get into the workforce — maybe they're hungry because their parents can't feed them on the welfare cheques they're getting — fighting those obstacles and reading this kind of crap.

AN HON. MEMBER: That's the B.C. Teachers' Federation.

MS. SMALLWOOD: Well, I would suggest.... I will ask the minister whether you will make representation to have this course reviewed and to have all of the biases — and that is only one section that I have quoted — taken out of the course and rewrite the consumer ed courses, which our kids have to pass before they get their grade 12; to be unbiased and of some use. These government members get up repeatedly and talk about politics in school; I don't know what that is if it isn't politics. I'd like to hear from the minister whether he will support me in having that course reviewed.

HON. MR. JACOBSEN: I came here today to do the estimates for the Ministry of Social Services and Housing, and I would think that even the members opposite wouldn't hold me responsible for or expect me to make the changes in books that are in the school system. I tell you, if I start reviewing the school system — if that's a job that I have to do — I'm going to be awfully busy, because I guess I wouldn't stop at just that page. I would look at a lot of other things and be sure that I was comfortable with all the things that were in it. I don't think it's reasonable.

The Ministry of Social Services and Housing, as we mentioned at the outset, has a budget of close to $2 billion, and reviewing that is pretty much a full-time job. If you have concerns about what is in the literature in the education system, then I think.... You have had the Minister of Education up for a number of hours. I'm sure you must have asked him the question. Let him deal with those issues; let me deal with those that are concerning this ministry. If we can get on with the questioning, I'd be pleased to answer.

MS. SMALLWOOD: I'm really quite disappointed and saddened by that, because I think — to go back to some of the very clear messages that you've gotten in the last year — that unless governments start dealing with the whole child and the whole family, we're never going to see any movement on addressing the crisis that the province feels as far as family relations go.

The message was that we have got to begin — not only in the delivery of services, but in the messages we give people — to take some responsibility for where we're heading as a society. I'm sorry that the minister wouldn't even see fit to raise his voice in protest about that, because it relates to the people that your ministry serves. It relates in the most simple, direct fashion to an advocacy role that you could play on behalf of those children — a very valuable one — and I'm sorry you don't see that it would benefit, maybe break, that cycle of poverty and maybe give those kids a real shot at being the best that they could be.

MR. JONES: I'd like to thank the member for Surrey-Guildford-Whalley. I think she raised a critically important point, and I want to give the minister another chance. I was quite shocked when the member indicated that that statement was part of the school curriculum for British Columbia. I appreciate the

[ Page 12938 ]

minister isn't responsible for the school curriculum in British Columbia, but he is responsible for the attitudes towards the social service system that exist in this province. I think he does have some responsibility there.

The request from the member for Surrey-Guildford-Whalley, as I understand it, was that you take some action. It might mean having a conversation with the Minister of Education, or it might mean writing a letter to the Minister of Education. I don't think that's a very onerous burden. I know how busy the minister is, but it's a very simple request.

If he really believes what he said in this House — and I was very pleased at his response in disagreeing with that statement.... If he really believes what he said a few minutes ago about the inappropriateness of that view, then I think he'd be quite willing to have that conversation and write that letter. I'd like the minister to respond. I hope he has changed his mind.

HON. MR. JACOBSEN: One thing I don't like to do as an individual is be uncomplimentary to people I'm talking to, regardless of whether we agree or not. But what the member opposite asked me is if I would participate with her in some kind of undertaking. I have to tell you that if I was going to join with someone, I would want to join with someone in whose evaluation of circumstances and social structure I have more confidence. I'm not really comfortable when I hear the member opposite give the views that have been given on a number of issues as I've sat in the estimates so far this year and last year. I don't know that I want to participate in any kind of joint undertaking to start reviewing what goes on in the Ministry of Education.

Secondly, I have to tell you that I've been around long enough that I would not respond to somebody picking a line out of a textbook. I would want to go there and know what was said in front of that and behind that, because it's very easy to make a compelling argument or state an opinion based on just taking out a bit and not looking at the overall context. Before I would make any commitment at all, I would certainly be very sure what I was commenting on. I'm not prepared to accept at face value the position presented to me by the member opposite.

MR. JONES: Will the minister make any commitment to follow up on the discussion we've had this afternoon with respect to that part of the B.C. school curriculum?

MR. PETERSON: On a point of order, Mr. Chairman, I would just like to point out that we spent 15 hours and 59 minutes debating the Education estimates, and I think that question should have arisen then. We should be dealing with Social Services estimates in this debate.

MR. CHAIRMAN: The point is well taken, hon. member. I suggest we get back to vote 52.

HON. MR. JACOBSEN: Mr. Chairman, I don't want the member opposite to feel neglected. If he will tell me the document this extract comes from and how I can easily get hold of the information, then I'll read the information. Sure, why not?

MS. SMALLWOOD: I will send a copy of the cover page of the textbook and the quote, including the page number, and will welcome any help the minister can give.

I'd like to move on from that quote and talk about poverty and, very briefly, the issue of earned exemptions, which we'll get back to later on. I've made a commitment to an individual — I hope the gentleman is listening today — to raise this to publicly lobby not only on his behalf but on behalf of a number of people with disabilities in this province, and I would expand that to include all people on GAIN as well. I'm introducing it in that fashion because I want to make it very clear that New Democrats are committed to this as a principle. I would hope that we could push the government to review their policies, to see the wisdom of allowing an increased exemption for people on disability, on handicapped pension and on welfare.

I think that it's fairly well recognized in this province.... Whether the minister is prepared to do it in this House or to do it in a public fashion, I would argue that all you have to do is look around the big cities of Vancouver and Victoria, and I suspect even Prince George — I see the member for Prince George — to see the number of people who are now having to live on the streets because they have no homes, and the number of people who have to line up at food banks, to understand that in our very short memory the situation in our society has changed significantly. Poverty is far more visible, and people are going hungry in British Columbia.

There is something the province can do. The province could very simply allow people to keep more of the money they earn, therefore increasing the standard of living and closing the gap between welfare payments and the poverty line. It's not going to cost taxpayers' dollars. It does encourage and support people going back into the workforce. People with disabilities often are only able to work a few hours a week, but by allowing them to keep more of their money begins to deal with the issues of poverty.

I would ask the minister to explain why the government has not allowed people to keep more of the money they earn. I encourage him to do as the New Democrats have done: clearly change his policy, come in line and embrace the policy that New Democrats have had for some time of increasing the earning exemption.

HON. MR. JACOBSEN: The reality is that it does cost, and it costs significantly because the earnings are then no longer exempted. The province continues to pay the full amount regardless of the increased income. So there certainly is a cost to government.

There's also, I think, the relationship between people who are not on social assistance and people who are. We are unable, in fact, to broaden the base for

[ Page 12939 ]

social assistance. We have a very substantial number of people depending on the program now. I think the GAIN portion of our budget is about $1 billion, about half of what we spend each year. So it's a very substantial amount of money.

In my view, given all the other requirements in society, all of them are very good causes and necessary services. You have spent some time debating Education and Health, and I listened to a fair amount of the debate on those ministries. One thing I did not hear was that too much money was being spent and that we should in fact cut back on those services. The suggestion was that we should have more of them.

[3:45]

In order to meet the demand for all the services.... The province only has so much in resources, and we spend a lot of money through my ministry. I would like to be able to provide greater benefits for the people in need, particularly those who don't have the option of earning additional income. But in order to do that I have to have some place to find the money. The initiative that we have recently taken by trying to assist people that are on social assistance to become financially independent is one of the main initiatives geared for that very purpose. If we could be very successful in helping people come off social assistance — those that are able to — and find employment, then we would have more resources left to distribute among those remaining. But as the situation stands right now, I think that we have provided into the budget of Social Services and Housing as much money as we can realistically afford to put there. It would be nice to have more, but I don't know where we would propose to get it.

MR. LOVICK: My colleague our critic for Social Services and Housing has graciously consented to allow me to participate in this debate about an issue that I feel very strongly about and am very concerned about. I'm referring specifically to the area of government spending with a view to creating employment for people who are otherwise on social assistance — that whole important, significant policy. I'm sure the minister shares the concerns.

Obviously what we on this side are concerned about — just as I'm sure the minister and his colleagues are — is whether we get value for money; whether the programs we are undertaking are having the effects we would wish them to. The predicament, of course — I made this point in Health estimates, I made it in Finance estimates, and I'm going to make it in others — is that I don't think, with all due deference, government is doing the kind of job it should in terms of evaluating its own policies and its own spending habits to ensure that we are getting that value.

It's not a matter of how much we spend. We all know that our resources are limited. It's a matter of allocating our priorities and of finding out whether what we're spending is having the desired effect.

I specifically want to refer in the estimates to vote 53, the programs-for-independence category, and still more specifically under that the employment initiatives program of some $39 million. The first question I want to pose to the minister, just for clarification's sake, is whether the LIFE program — Local Initiatives for Employables — comes under that classification. Is it true that the LIFE program equals the employment initiatives program and that that accounts for some $39 million of this ministry's estimates?

HON. MR. JACOBSEN: No, it comes in addition to the others.

MR. LOVICK: Could the minister then please tell me what amount of money is earmarked for the LIFE program specifically? That's obviously going to be my focus, Mr. Chairman, and therefore I want to have some idea of the magnitude of expenditure we're discussing.

HON. MR. JACOBSEN: If the member was asking how much money is involved, it's $39 million for the staffing and.... That program, yes.

MR. LOVICK: Now there's something mixed up, because if indeed it's $39 million, then it must be equivalent with the employment initiatives program, which is $39 million. So I was right in the first place that the LIFE program equals the employment initiatives program. Is that the case? I'm not trying to score points; I merely want to establish that we're talking about the same stuff.

HON. MR. JACOBSEN: Yes, the $39.08 million covers the program, but it doesn't cover the staff. The staff is above that.

[Mr. Pelton in the chair.]

MR. LOVICK: That obviously accounts for the discrepancy between those two figures. Good; no problem.

All right then, let's look at that particular initiative. Let's look at that particular program, the intention of which is to get employable people off the welfare rolls and gainfully employed.

Would the minister agree first that this program doesn't differ substantially from a number of other initiatives introduced by the Ministry of Social Services and Housing, though it might have gone by different names over time? I won't mention all the names, but they started in about 1969; then we had another program in 1976 called PREP; we had another one in 1980 called the Individual Opportunities Plan; we had another one more recently, in 1986, called JobTrac. Would the minister explain whether this program we're talking about is qualitatively and significantly different from those, or whether it's perhaps old wine in new bottles?

HON. MR. JACOBSEN: There have been other programs in the past, but yes, this certainly is a new program.

[ Page 12940 ]

MR. LOVICK: It's interesting: it seems we are going to take as our motto that we will be terse and succinct, indeed laconic.

Would the minister tell me how this particular one differs from its predecessors?

HON. MR. JACOBSEN: I can tell you about this program, if that's what you want. I can research it here and dig out the differences. I don't know exactly why you want to know the differences, but that's perhaps not my business.

This program is designed to help people in various ways to become independent. I don't know that it needs repeating. It's in the letter that I sent to all of the people involved, and I'm sure you have a copy of it. There are half a dozen ways in which the initiative works to help people get off the social assistance roll — if not to full-time employment, perhaps to part-time.

MR. LOVICK: I appreciate the candour of the answer. What I will do then is describe, albeit briefly, the principal defining features of some of those other programs and ask the minister if he would tell me whether the current program is in any way similar.

In 1969 the minister Phil Gaglardi created the Provincial Alliance of Businessmen, which was also ostensibly designed to get welfare recipients off the welfare rolls. As he said in his own inimitable fashion and with a perhaps more truthful attitude towards welfare recipients than some of his predecessors', in his mind the program was designed so that employable welfare recipients should get jobs and get off welfare. Pretty blunt. What he said at that time.... I'm sorry, I've misquoted it. Indeed, the line that I just quoted, I believe, was attributed to you, Mr. Minister, announcing the LIFE program. My apologies to Mr. Gaglardi, who is clearly not here to defend himself.

I want to refer again to the creation of the Provincial Alliance of Businessmen program. This was to provide a vehicle for business people throughout the province to employ those on welfare. Gaglardi's statement at the time, in the inimitable manner of "Flying Phil," as he was well and affectionately known by some at the time, was that "we need individuals in political leadership today more than ever; men" — only men in Gaglardi's time, as he didn't believe women were involved, but what the heck, that was his problem — "with the guts to stand up and say: 'We're going to get the deadbeats off the welfare rolls. See?"' It's sort of like Jimmy Cagney saying: "All right youse guys, see how we're going to do this?" — that kind of thing.

Interjection.

MR. LOVICK: What's the problem of the minister who is chortling? Do you want to argue something? Madam Minister, if you want to stand up and say something, why don't you do that instead of hiding behind your little table there as you often do?

The point I'm making is that at the time, the plan for the program to get people off welfare and back to work was to encourage business people — I guess by means of loans and incentives of other kinds — to employ those people. Does the current LIFE program have any similarity to that?

HON. MR. JACOBSEN: No, it doesn't.

MR. LOVICK: Let me move ahead to the next major initiative under the aegis of Social Services and Housing. This one was introduced by the not-too-long-ago Premier of the province, who was at that time the minister responsible. The program was called the provincial rehabilitation and employment program — PREP. That was introduced with his famous one about "we'll provide shovels for those who won't work," etc. PREP, as members will recall, consisted of counselling and training for welfare recipients offered by the newly hired government staff. It also provided funds for transportation and work clothes so that workers could indeed go to the job site and present themselves ready, willing and able to work, and not dressed in a manner that would make them appear to be unsatisfactory employees. Does the new program bear any resemblance to that one?

HON. MR. JACOBSEN: It doesn't really require a new program to do those particular things, if my understanding is correct. It must have been a good program that the member had, because it seems like it's endured for a period of time. We still provide the training and assistance for people to get off the system if they are able to do so.

I don't want to say any more, because I know a lot of thought went into the process of how you're going to ask these questions. If I answer them all at the beginning, you won't have anything to ask. So I'll sit down and let you ask some more.

MR. LOVICK: I suspect the reverse is true, but what the heck, I am quite prepared to do this on a kind of seriatim basis. Let's move ahead to 1980. It's interesting that we had to announce a new program with new titles and new terms of reference, if indeed the one in 1976 was so successful. But let's let that one hang out there for a moment; let's look at 1980.

The person who introduced that program was the member who now is the first member for Vancouver–Little Mountain. Her program was called the Individual Opportunity Plan. That program, people in positions of authority and expertise argue, was cobbled together from remnants of the PREP program and similarly consisted of funds for counselling, training and employment-related expenses. For the first time — just in passing — single mothers with young children, those other welfare recipients who clearly should have been back on the work rolls, were expected to seek employment. Does that one differ in any significant and substantial way from the newly announced LIFE program?

HON. MR. JACOBSEN: It's close, and I guess what this really shows is that over a number of years the government has taken seriously the responsibility to help those on social assistance become financially independent, for a number of reasons. But I don't want

[ Page 12941 ]

to talk about the reasons because I know the member hasn't got to his last question yet. The difference from that particular program is that the program we have today has been directed to people other than single parents with children — if that's who was included at that time; I'm not sure.

[4:00]

MR. LOVICK: I appreciate the answer. Can the minister confirm that in 1986 we had another program ostensibly to serve the same purpose as this one, creating a partnership with the federal government and the Ministry of Labour? The program was called JobTrac. That was in 1986; it was also introduced by one of your colleagues, Mr. Minister. This one was specifically targeted to create jobs in forestry, tourism and the environment. Is this one in any way similar, beyond those simple points, to the LIFE program? Or is the LIFE program authentically different?

HON. MR. JACOBSEN: It has similarities. I guess it's not identical, but I have to tell you, so that we don't create a misunderstanding for people that may be watching these proceedings, that in all of the intervening years we also had programs to help, and we had programs before this recent initiative. We have had a program in place to help people make the transition from depending on social assistance to becoming financially independent. That has been an ongoing process, but there have been a number of occasions when the government has made a special initiative under particular circumstances such as those we face this year. But I suspect you're getting to that one now.

MR. LOVICK: Could the minister tell me why that last program was reconstituted and renamed in 1988-89 as JobTrac? What was the justification and logic behind doing that? If it's the same program essentially, why did we give it a new name yet again and announce it as if it were a whole new initiative on the part of this government?

HON. MR. JACOBSEN: Well, I'm not sure at this point whether the member has now got to the current program. Is that where you are now?

MR. LOVICK: I thought I was making it very clear.

HON. MR. JACOBSEN: No, you weren't making it very clear. It's a little bit confusing trying to follow this track, but I know the target we're going for, so I'm trying to stay with you on it. Anyway, what's in this program today is spelled out very clearly, and whether it has similarities or differences compared to previous programs is really of no concern to me. It may be of concern to you, and if you have a concern about that, I would like you to tell me so I can hear what those concerns are. I don't know where that makes any difference — it's the results, the intention and the purpose of the program.

MR. LOVICK: It's the results, says the minister. You got it. The penny dropped. That's precisely what I want to talk about. The quintessential case that I would present to you, Mr. Minister, and would offer you an opportunity to respond to is that those programs, remarkably similar in content, which have been around for some 20 years, have not made a whit of difference. They haven't had any significant impact. Those same basic statistics for the number of people unemployed, the employment rate in the province and the number of people on social assistance — all of those statistics — have remained relatively constant for 20 years.

The obvious question is: what has been done to evaluate the program? What has been done to demonstrate that this approach works? What has been done to demonstrate that what we're dealing with is in fact an honest effort to grapple with the problem, not just a rather expensive public relations exercise to convince us that we have to get those "lazy bums" — as some would have it — off welfare and working?

AN HON. MEMBER: Shame on you!

MR. LOVICK: Somebody says: "Shame on you, what an awful thing to say!" Let me remind those people that the evidence demonstrates very clearly that the programs have not made any difference. Nevertheless, with depressing regularity we get new announcements of new programs telling us that at last we're going to solve the problem, because of all those people apparently cheating the system. I submit to you that that's the shameful behaviour; that's the dishonest approach to it. I hope this minister isn't part of that, but it certainly seems to be the record of this government. I would therefore ask the minister to tell us what we are going to do to determine if this program will be any different from all those others, and if we are going to get value for money.

HON. MR. JACOBSEN: The member opposite has made some very critical remarks about people receiving social assistance. He wants to attribute those remarks to me or to this side of the House, but we never made them. He made them, and there's no place.... We have the estimates in front of us, and it's a very large book. You can go through this; you're welcome to look at it from beginning to end, and nowhere in it will you ever find any indication of the words you have used to describe the people on social assistance. We don't talk about it in any of the material that's here; we don't talk about people that way when we're discussing in my office the problems of dealing with the great demands on the social service system. It is not the kind of discussion that takes place between me and my staff at any time.

As far as the benefits are concerned, I can tell you, Mr. Member, that if there was no financial benefit flowing from the initiative we have taken, I would still be very pleased that we had taken it, because we have helped a significant number of people make the transition to financial independence. That is worth something that goes beyond just dollars and cents. It does a tremendous amount for the families and the individuals involved.

[ Page 12942 ]

So even if the financial benefits were neutral, it would still be a good program. But that is not the case. The programs that you talked about.... I don't know about the ones when you go a long way back; I would have to research that, and I hadn't done that before today. But the one you talk about — the most recent one before this initiative — brought many people into the workforce who were depending upon social assistance. We expect that the investment we are making within the ministry to provide additional staff and to provide these services will show a financial benefit to the province several times the amount of the investment we make. It will show that return not because anybody is forced into any kind of hardship, but because people have found an opportunity to become independent.

Last year approximately 7,000 clients obtained jobs under the Employment Plus wage subsidy program. A further 9,000 participated in job action and other special employment projects. An average of 1,600 single parents have become independent of social assistance through employment received through transition benefits each month.

The member says we haven't succeeded because we still have a number of people dependent upon social assistance. I submit to you that you have seen the situation only after the programs and initiatives have taken place. You have no way of knowing that the situation would not be even worse had these initiatives not taken place. You're basing your evidence on one side without knowing what the other consequence would be. Certainly we haven't changed the fact that people are depending upon social assistance. Certainly the people in this province are subject to the economic downturns that have hit this province along with the rest of the country, although not nearly as severely as in most places in Canada. But to say that the programs have been of no benefit is a gross misstatement.

MR. LOVICK: We appear to have two parallel streams going on here, Mr. Chairman. I did not say what the minister just said I did, and I don't want to waste the time of this House in a "You said; no, I didn't" kind of silliness; instead, let's talk about the issue.

To be sure, Mr. Minister, and to your everlasting credit, I have never heard you say anything that denigrates people on welfare — fair ball. But please don't have the temerity to sit here and say to this House that others of your colleagues have not. What about Phil Gaglardi? What about the former Premier of the province? What about the member for Little Mountain? All of them as welfare ministers have made those kinds of comments. Moreover, what about the point raised less than 20 minutes ago about the school curriculum? If you don't consider that a derogatory and pejorative comment about people on welfare, God knows what you require as evidence. The fact is that anti-welfare culture is alive and well. Further, I would submit to you that the LIFE program, as introduced, implicitly says the same thing. It says that employable people are choosing not to be employed and are ripping off the welfare system. That's the premise of the LIFE program. Moreover, I see that your colleague the Solicitor-General — my colleague has kindly passed this on to me — has used the term "welfare junkies." So tell us about your self-righteous and pure stand and loving those individuals on welfare — maybe you, Mr. Minister, but certainly not all of your colleagues.

Similarly, nobody is arguing for a moment that the money we spend is entirely wasted — we're not saying that. Anybody who knows anything about economics knows that if you transfer $30 million to people who otherwise don't have money, you do something to fuel the economy — that's Keynesian; it's good macroeconomics. It's about transfer payments. We all accept that as a reality of the modern state.

The fundamental issue I am addressing is whether we have in place anything to evaluate the work we are doing, to find out if we couldn't do it better. I'm suggesting to you, moreover, that the evidence we have is that all of our new programs — announced with great fanfare — have not demonstrated that we have learned a damned thing over 20 years, despite spending the money. It appears we haven't learned anything, because we can't point to any significant successes between 1967 and 1991 — it's the same stuff. The obvious question, then, is: are we evaluating what we've done in the past, so that we can learn from it, with a view to making sure that how we spend our money today will be handled better and more effectively and more efficiently? That's the question, Mr. Minister; I'd love to hear your answer.

MR. REID: With leave of the House I'd like to make an introduction.

Leave granted.

MR. REID: Mr. Senator, in the precincts today we have another senator, in the municipal field: Bill Fornich, representing Surrey. Certainly the welfare of Surrey is always on the mind of that member. I hope the House will give him a very warm welcome.

MS. SMALLWOOD: I'd like to add my words of greeting and welcome to a good friend and longtime co-worker in Surrey. Welcome, Bill, and I hope we continue to do as well.

HON. MR. JACOBSEN: The answer to the previous question is yes, we do evaluate the programs. We try to improve the programs based on the evaluations we have made.

I want the member opposite to know that the remarks he attributed to people on this side of the House and people who have been on this side of the House.... I don't think he included anyone who has ever been on that side of the House, but I guess they're much purer. I don't know about those remarks, but I do know one thing: there's one great justice in this world, and that you are responsible for what you as an individual do or say. I come from that perspective, that what I say and do I'm accountable for, and I don't mind being held accountable for it.

[ Page 12943 ]

In that vein, I want to tell you something. It's not something I need to explain, but I will explain it. I just want you to know that these things are not done lightly or quickly. When it came to sending out the letter to the people who receive social assistance, I sat down with my deputy who is here beside me today and other staff members, and I went over it several times.... I asked them to guarantee that the letter only went to those who had a fair and reasonable opportunity — there was a reasonable expectation that they could find some kind of employment. We purposely did not go to single parents, because it involved children. We did not want to put any stress on those people, because I was concerned that their situations are different and more difficult to deal with. We went with those where I believe there is an opportunity that if they can get the help they need, they can make the transition.

I understand what people go through when they are faced with economic difficulties. It's easy for the rest of us to stand back and say that there are opportunities for them, but when you are in that situation it's hard to see those opportunities and hard to take advantage of them. Sometimes it just takes a little bit of help. We have provided that help.

[4:15]

The research we have done is through the social assistance recipients strategy. There are four parties involved: Health and Welfare Canada, Canada Employment and Immigration and the provincial government's jurisdictions. It's a matching program: $28 million provincial and $28 million federal money. We are the first province to enter into the program. The evaluations are part of that. We have found that when we help people to get onto a job, be it part-time or whatever, those people who actually get a chance to be employed get off social assistance sooner and stay off it much longer. That initial job experience has a great deal of success attached to it. We know that we help people a great deal when we give them that opportunity.

MR. LOVICK: A simple question: if so, if you really believe that those individuals who are receiving social assistance are indeed only those who need it — that they aren't chiselers and all they need is that help and the likelihood of their getting employed again is high, given some help.... If we really believe that, why do we have to introduce a program that implicitly says that what we have been doing to this point has clearly not adjudicated and screened applicants carefully enough, and therefore we have to launch a new program and write letters to all those people, because we're not sure that they are trying hard enough to find work? Explain that to me, please.

HON. MR. JACOBSEN: It is not the fact at all that we have not screened people properly and that people are on social assistance who should not be receiving it at all. We have help for people because they are caught...requiring social assistance to be able to live. These people have come and asked for help; they need some kind of assistance and support. If you follow that logic, the simple thing would be, I suppose, to say: "There will be nothing available for you." We don't do that. We help people when they come; we help people make the transition from depending on social assistance to becoming independent.

It's not a question of their not having been screened properly. We're not saying that people are not entitled to it. I have said repeatedly, when I've been asked about the program, that if people cannot get a full-time job — which may be hard to do in many cases, particularly a full-time job of their liking — maybe they can get a part-time job. If they make something, and it's not enough, we'll help them make up the rest, so that they can live properly. What we expect is that everyone will try to make the effort to be self-supporting, if they possibly can.

MR. LOVICK: I must confess, Mr. Chairman, that it seems that the minister is being deliberately obtuse. The point I am making has nothing whatsoever to do with the validity of providing people that assistance. We all know that; we accept that. It's good, important stuff. The issue, however, is that if you send out a letter to people who are currently receiving assistance, and you suggest to them in the letter that they're going to be cut off assistance because they're employable, doesn't that suggest to you that they are in fact being put under the gun and that the onus is on them to suddenly prove that they are indeed legitimate, reliable, honest and fair? That was certainly the response I got in my constituency from a number of different people who called, scared to death that they would be cut off — including, I might add, a single parent, despite your vaunted screening process, Mr. Minister.

HON. MR. JACOBSEN: I know the purpose here is for your side to ask questions and for me to provide answers, but I would really like to ask the member opposite if a single parent has a letter. If so, could I please have a copy of it? I would be very interested in obtaining it. As far as I understand, no single parents received that letter.

You were asking about us cutting off benefits. I've got the letter right here; I've gone over it many times. It's a little while since this letter went out, but as I read it over, unless I'm missing something, I don't see where we ever suggest that we would cut anyone off.

Interjection.

HON. MR. JACOBSEN: Yes. I want to make it very clear, Mr. Member, that I make no apologies for the letter. I want to make this point very clear: as I stated earlier, we in this province spend about a billion dollars a year providing social assistance, and we don't have the resources at the present time to be able to justify spending more than that. I don't know where we would get additional moneys, if we were going to spend more on this particular program. I have a concern that we have a number of people who are depending upon us for assistance, who have really no options: the elderly, children, handicapped people. Those people must be looked after.

[ Page 12944 ]

When this letter was sent out, it was a conscious and deliberate decision that we would ask these people to do what they can, to cooperate with us, to reduce the burden on the social assistance program, so that we could be sure we'd be able to continue to provide an adequate living for those who haven't got the opportunity to provide for themselves. I make no apology for that statement, nor do I make any apology for my expectation that people who are physically able and have an opportunity to become employed should take advantage of the support we provide for them to become employed. That is the responsibility of you, Mr. Member; that's a responsibility of me; that's a responsibility of every citizen within this province. But there are number of people who don't have that option for some reasons that are not of their own making. For those people, we will be there to provide for them.

MR. LOVICK: I don't disagree with too much of what was just said. I'm pleased that the minister has said all that, because I will be able to send out those comments as recorded in Hansard to the 20-odd people that called my office who were very worried about what policy was being introduced by the ministry. With all due deference, Mr. Minister, I don't think your letter was well crafted; I do not think it was terribly sensitive; I don't think it showed much empathy. I would suggest you might want to take that under advisement. Have a look at it. Perhaps test it out with some of those people who received it who were alarmed by it. I would also suggest to you that yes, indeed — to answer your question — I will give you the name of that individual, with her permission, or at least I will show you the letter she received.

Let me just present the case against this program in terms of evaluation of the program and whether we're getting full value for money, as presented by faculty at the University of Victoria School of Social Work. I hope you're familiar with the case they've presented. I understand they've written a report, and I would dearly hope that you and your officials have had an opportunity to look at that report.

[Mr. Ree in the chair.]

Their examination of B.C.'s so-called workfare programs — and I'm quoting now from Marilyn Callahan, associate professor at the University of Victoria School of Social Work — concludes:

"These programs have had no impact on reducing the numbers of income assistance recipients nor on the length of time they receive assistance. Further, there is no evidence that the benefits of these programs exceed their costs. Not surprisingly, the only factor that appears to affect the number of people on income assistance and the length of time they remain in receipt of welfare is the rate of employment. From 1967 to 1988, the percentage of all B.C. citizens on income assistance has remained about 33 percent of the unemployment rate, regardless of the existence of 'workfare' programs."

That's one of the challenges thrown out by those people working in the field, Mr. Minister. I'm wondering if you are prepared to provide a detailed response to those contentions. If those allegations are true, then surely we ought to be re-evaluating our approach to dealing with this serious problem to ensure that we provide the assistance to all those people who deserve it — and to provide those unemployed individuals with what the vast majority of them really want: an opportunity to be gainfully employed. Would the minister care to respond?

HON. MR. JACOBSEN: I have a note here that says: "Callahan and other university professors use the term 'workfare' to describe British Columbia's employment initiative programs. They use the term in error. Workfare has been tried in the United States with little success. Cost-sharing arrangements made with the federal government specifically exclude work-for-welfare programs. Income assistance recipients in British Columbia do not have to earn their income assistance, and that's established by the act in Canada."

MR. LOVICK: I find it difficult to conceive that a group of university faculty specializing in this field would not be mindful of that simple bit of information. Are you telling me, Mr. Minister, that this discounts the case they present, because they don't know the meaning of that particular program and the funding arrangement for it? In other words, is your answer essentially a denial of the claim they put forward?

HON. MR. JACOBSEN: My view on it is neither one of confirmation nor denial. I know there are a lot of opinions on how you might deal with any social problem, and social assistance is no different. There are people who are satisfied that they have the answer to dealing with the problem.

I think that if you examine the record of this ministry, you will find that one of the things we are very open about — and I make it a point as minister to make sure that we are — is that we are willing to listen to what people have to say — people who have views and can offer input and assistance on how we might improve what we're doing.

We have recently opened up the major act in our ministry that provides for the protection of children. The purpose of doing that is to get all of the input we possibly can from as many people in society as possible, because we believe that what we have now is good legislation. But I'm convinced that no matter what we're doing, there are ways we can do it better. I think that the people out there — some who are friendly to the government, and some who are critics of the government — have ideas, and we would like to hear from them. We would like to take the best ideas that are available and incorporate them into our program. We want to do it in that particular case, and we're happy to do it within the GAIN program.

If there's a better way for us to spend the dollars that we do spend.... But I have to tell you, Mr. Member, that the money we spend in these programs is for the most part money that goes out in a cheque directly to someone else. That's how this money is spent. I don't know if you can find a better way of doing it, because people need that cheque in their

[ Page 12945 ]

hands in order to buy their food and their shelter. That's where the $1 billion essentially goes. It's not a lot of programs. We have programs to try to help people make the transition from the system, but that is admittedly a small part of the overall cost of this particular system.

[4:30]

MR. LOVICK: I don't want to belabour this point, but just to clarify, I am not talking about the concept of welfare to provide assistance to the people who are unemployed. I'm not talking about that. I'm talking about the apparent propensity of your government and preceding governments of the same political stripe — the same ideology and name — to regularly reintroduce what is essentially the same old program in order to get another hit and to give another sense to the public that now your government is dealing with the problem, when there appears to be not much, perhaps nothing, new under the sun.

I also would like to emphasize again that insofar as the minister agrees with me that the obligation of those who make and administer public policy is constantly to look at whether we can do it better, we meet, we have no disagreement; that's the whole point of my asking these questions.

Unless the minister has something else that I feel honour-bound to respond to, I want to conclude my brief comments here by saying that I hope, if he is committed to the notion of taking input from a variety of sources and a number of people — indeed even institutions — that he and his colleagues will look very seriously at responding in detail to the analysis that has been produced by the University of Victoria School of Social Work faculty. I think they raise some fundamental questions that ask us to look very seriously at our entire approach and to perhaps radically revise our approach. I hope that the minister will then give me and my colleagues the assurance that this will indeed be done. I think it should be done.

HON. MR. JACOBSEN: I'm in agreement with that. I noticed, though, that we talk about programs and methods of dealing with the need for social assistance. I don't want to bring up the case of Ontario, but Ontario's the only place in Canada that presumably is governed by a philosophy similar to the one across the way. I have the program right here. On a number of points it lists what Ontario does and what British Columbia does. I can tell you that we both deal with the problem in the same way. The difference is that Ontario allows much bigger exemptions than we do. But they haven't come up with any unique way of getting people off the system. It seems to me that their program is one that's designed to bring a lot more people in on it. I notice here on another note I have that it's estimated that their budget for social assistance will be $1 billion overspent for this year.

I'm happy to hear ideas from any source, and I'll look at the material you're talking about. I'll give that some personal attention, because I'm interested in what people have to say about the problem, not only for the dollars and cents, but for the human values that are involved — the ability for people to make the transition from having to depend on government assistance to being able to be independent. I think that's worthwhile, and I'll look at that.

MS. SMALLWOOD: I thank my colleague for his intervention, and we will follow some of those issues later on in the estimates. I'd like to talk to the minister about his children's policy for British Columbia. The press conference with the minister and the interim Premier wasn't received very well, mainly because people in this province are pretty aware of the situation of children due to poverty, the need for a number of services and this government's total inability to grapple with children's reality. In reference to the curriculum quote that I gave him, the minister said that he is unable to deal with education issues. I want to just directly remind him that in his children's policy for British Columbia, the policy of his government, one of the quotes there is to provide an education system that respects and encourages individual potential. Under that policy alone, with great fanfare, Mr. Minister, you and the interim Premier held a press conference promising to follow these guidelines in the treatment of children and the development of legislation. I suggest that it's entirely appropriate for you to also advocate on their behalf as far as the education system is concerned, using your own policies.

In addition to that — and I know that at this point perhaps the minister's feeling a little bruised — in respect to that particular press conference where the minister and the interim Premier actually used the kids as a backdrop and then promised not to exploit kids — the minister went on to talk about great platitudes: an intent to provide supportive services directed to assisting families in raising their children; to provide protection and take responsibility for children when the families are not able to do so; and to consider, when introducing legislation, programs and policies, the best interests of children and family.

I can only draw from that great press conference that the minister is feeling a little sensitive about his inability to deal with the issues arising in this province to do with children. But I will do the same thing this year as I have done in past years and point to the minister's and this government's signature on the UN Declaration of the Rights of the Child. I suggest that if the minister is sincerely looking at improving the rights of children in the provision of services, we might take a look at that document.

I remind the minister, if he is not already aware, that your government, a year ago at least, signed a document, sending a letter finally to the federal government saying that you had gone through all of your legislation and policies and felt that you had lived up to the responsibilities of the Canadian government as a signatory to the UN convention.

I think it's instructive in this process to go through some of the articles in that convention and talk about how, in this process you've embarked on, you might do more than bring your legislation in line and indeed look at organizing some of these services.

[ Page 12946 ]

Article 3 of the convention calls for the state to provide the protection and care that is necessary for the well-being of the child. I see that in your principles there. Yet we know that children in care sometimes suffer from placements and have less than adequate access to counselling services. Just one little example of what is happening in this province — not only problems with regionally accessible services.... I'm sure the minister is well aware of the fact that many youth services are centred in the lower mainland, when and if they do exist, and that people on the lower mainland as well as in more remote areas in the province have great difficulty getting services to children.

I wonder if the minister can indicate to the committee where you're headed with your proclamation and with the UN convention, as to making services more accessible and indeed providing that protection you so euphemistically talk about.

HON. MR. JACOBSEN: The UN convention on the child is a good and very interesting document. I think when you view that document you need to keep it in perspective. It's a document that covers the world, and the situation faced by many children in this world is different from that in Canada. They face very extreme circumstances. They face situations where the families are able to do precious little for their children. In some cases the state is able to do precious little for them, either. The logical alternative to that is to provide as much protection as you can by providing them with some rights, hoping that even at their young age, equipped with these rights, they will be able to fend for themselves in a very unsympathetic world.

Under those circumstances, the UN convention is an adequate document. In Canada and particularly in British Columbia we can offer children a little more. My understanding is that the provinces will still have the opportunity to make their comment regarding the UN convention. The position that we would take, presumably as a government, with regard to that document would be consistent with our policy on children. One of the reasons for having the policy is so that we can clearly spell out what the priorities for children are in this province.

You mentioned one section of the UN convention on the responsibility of the state. We recognize that government certainly does have a responsibility, but we don't start of with the responsibility of the state. If you notice, our document very clearly starts off with the responsibility of the family. We believe that families have a lot of rights. Parents have rights. I believe that with those rights go responsibilities. We don't want to intervene as a government into the family unit. We think the family unit is best left on its own. There are circumstances where the family is unable to provide for the needs and the protection of that child. When that happens, we expect that the community will be supportive of their children, and the government will then intervene to make sure that every young person in British Columbia is guaranteed the opportunity to maximize their own potential as future citizens of the province.

MS. SMALLWOOD: I'm sorry the minister didn't see fit to answer the question. My question referred to the policy statement with regards to your responsibility. I'm not talking about the responsibility of families and children. I would not presume to suggest that I, as a member in this House — or after the election potentially a member of government — know better than a family how to raise a child. I would not presume to try to outline for them what their responsibilities are and how they should conduct their lives.

[4:45]

What I'm talking about is your responsibility as the person where the buck stops — as far as care for children under your statutory responsibility as the minister is concerned. I asked you specifically, in line with your policy — and I might add that issuing these lovely-sounding statements is a real cop-out when you have the power of legislation to enforce and to actually give the children in care in this province some tangible rights that they can do something with....

But let's talk about these platitudes and, as I've said, compare them with the convention. You say that the UN convention deals with the whole world and Canada is a lot different. We'll talk about how Canada's different and how Canada treats its children and what it’s like to be poor in Canada as a child. I would suggest to you that a poor child here in Canada suffers just as much and needs just as much attention as a poor child in other countries. To say that that kind of suffering doesn't happen right here in our own back yard is to suggest that you have your eyes closed.

My question to you was along the lines of article 3 of the UN convention. I will repeat it for you: it calls for the state to provide the protection and care that is necessary for the well-being of a child. We're talking about children in care — your direct statutory responsibility. We know that children in your care suffer from time to time in placements and that even in the best of placements they often don't have the support of community services, one example being the accessibility of counselling. Let's use another example — as we see in sexual abuse cases, as we see in some children that have drug and alcohol problems, as we see in young sexual offenders themselves having trouble getting services in this province. According to your policy and the responsibility of your government in this policy, and according to this province's agreement with the UN Declaration of the Rights of the Child, can the minister indicate to me what you are doing to ensure the rights of those children in your care to access to services and to stability in the placements that you provide?

HON. MR. JACOBSEN: I can tell the member opposite that we do a great deal for the children that we have in care. In fact, I would venture to say that the children in care in British Columbia are some of the best-looked-after children that you will find anywhere in this country and perhaps in any other country. We're very proud of that; we're pleased with that.

That's not to say there are not sometimes problems with the care facilities. Children may suffer from an unfortunate circumstance in a care facility just as they

[ Page 12947 ]

suffered in institutions when they were put there, and just as many children suffer from unfortunate circumstances in their own home with their own parents. As a matter of fact, I think the statistics clearly show that with those that suffer from abuse and sexual abuse it's generally by another family member.

We know society is not perfect, and because we employ many people in providing care for children, we cannot guarantee that there will not be some that will commit an offence from time to time. It's to be expected that that will perhaps happen. But what's important is: what do we do about it? We do not ignore a situation of abuse of a child. We take firm and swift action in dealing with any situation where the child is suffering from abuse.

As far as having programs available, we can be very proud of the record in British Columbia, because we have a lot of programs for children. We spend a great deal of money supporting children who have special needs, and we provide help that is beneficial. It's something that has shown its value by the number of children that we have dealt with. But we have children that come into our care who start off with very severe problems, and it's not an easy situation. We have some of the best caregivers that you could ever find to deal with children that have severe emotional problems. They do it, and they do it really well. I thank them for their contribution.

MS. SMALLWOOD: I have no allusions that I'm going to get anything more than rhetoric. I do want to refer to a specific. The minister says that the UN convention deals with the state of children in other areas, and that we're fortunate here in Canada. Let me refer to a study that was done in Vancouver and Victoria on infant mortality. When we're talking about the safety and protection of children, it was shown in this particular study that in affluent neighbourhoods in Vancouver and Victoria an average of 3.5 baby boys die for every 1,000 births within the first year; but in the cities' poorest districts the number of male infant deaths soared to 13.6 per 1,000. The study also showed that for every 1,000 girls born in the poorest areas, 11.6 died, compared to eight in the richest areas.

Very clearly, poverty has an effect on children's lives and children's health in this province. When we're talking about mortality rates connected directly with poverty, I would suggest that this is one of the best ways any government can effect the rights of children: the right to good health; the right to a life. I would be interested to hear what the minister intends to do to deal with these mortality figures and to assure children — as quoted in your policy — that they can enjoy good health.

HON. MR. JACOBSEN: The purpose of the policy on children wasn't something that was done lightly. Although I appreciate the members opposite are not willing to accept this, it was not done for any political reason, either. It was done within this ministry for a very serious purpose. The ombudsman had a hand in our formulating the policy, because the ombudsman made a recommendation that said there should be such a policy for this province.

The benefit of having a policy is that it spells out in written form what we are trying to achieve as a province. Once we have written out what we think is the ideal circumstance and put it in as a policy of the government, then that is what we will strive to attain. When there are changes to be made in legislation and when there are programs to be evaluated in this ministry and several other ministries, we look at that policy, and we aim to achieve the purposes that are spelled out within that policy. That's the purpose of it: so we know what we are trying to achieve. It's there in black and white.

I'm very pleased with the document. The people worked very hard on it to make sure that it gave the best and clearest intention of what was best for children and for families. I think that you may find many things to criticize me as a minister or the government for, and let that be so — I have no problem with that. But don't do it on a policy that deals with the ideal circumstances for children in this province. Surely you and I and everyone in this House can agree that that's what we want to achieve.

MS. SMALLWOOD: I want to continue along the same lines. This government is in its fifth year, and while I think that the policy directions you have spelled out are ones I would hope that most could agree with, the fact is that it's a little late not to have some solutions or some direction about what you're going to do about these things. None of the information I am giving you now is new. It is information that is well known, from people who have been working in the areas of child protection, advocacy groups, community groups and families. It certainly is well known to your ministry. What we're looking for is some action.

Let me continue along the same lines, and this is continuing with your policy statement to provide means whereby children can enjoy good health. I would suggest that you, in your policy statement, talk about assisting families in raising their children and on and on.

Another statistic and another study — and this is a national one — says that poor children in urban Canada are much more likely to die both in accidents among older children and of illness among infants than children of the wealthy. I quoted to you statistics from a study of infant mortality due to poverty right here at home in Victoria and Vancouver. I will quote statistics on accidents. Accidents are the leading cause of death in children older than one: motor vehicle accidents — major type — followed by drownings and fires, according to the Canadian Institute of Child Health. In 1985 about 1,600 children died in accidents, of whom 900 died in motor vehicle accidents, 157 in drownings and 121 in fires, according to the Ottawa-based institute.

It asks the question: why are children who live in poor areas much more likely to die of traffic accidents? "It is not that rich people are better drivers; I think rich people get better policing and live in environments where kids are less likely to play on streets," said Dr. Ivan Pless, a pediatrician in Montreal Children's Hospi-

[ Page 12948 ]

tal. They're conducting the research. It goes on to talk about the environments that poor children live in, which put them at higher risk of fatal accidents.

Again, this is an issue where governments can have a real impact. If we are talking about policies, this government in its fifth year certainly should be able to go that next step and give us some indication about what you're going to do about poverty and the impacts of poverty on children.

We haven't even begun to talk about how poverty limits the ability of children to be the best that they can be. We're only now talking about the rights of those children to be able to live a healthy life — indeed, to be able to live. We'll continue with these policies and compare them to the articles in the UN declaration.

In the work that the government, is doing — and you're talking about the review of the child protection legislation — I just want, for the record, for those people who are listening, to remind the minister that a government that is in its fifth year is promising a public announcement in June 1991. Well, we got the public announcement that you're going to review: June to September 1991 — preparation and circulation of the discussion paper; September 1991 to February 1992 — public consultation; March 1992 — release of a White Paper; April 1992 to September 1992 — written responses to the White Paper; October 1992 to January 1993 — drafting of legislation; March 1993 to April 1993 — introduction of legislation to the Legislature; May 1993 to October 1993 — policy procedural development; September 1993 to January 1994 — implementation planning, public information, staff training; legislation to be proclaimed no later than April 1994.

The fifth year of a government's mandate: platitudes, with studies done locally, studies done nationally — years old now — talking about poor kids dying. Surely to goodness, Mr. Minister, you've got something to offer this committee that could indicate that this government is doing something for kids.

[5:00]

AN HON. MEMBER: Patience, tolerance and understanding!

HON. MR. JACOBSEN: Patience is a virtue, isn't it?

We're learning some interesting and unfortunate facts. We're learning that there are poor people in Canada — not as many as there are in many countries, but there are people who are poor. We've learned that it's not good and easy for children who grow up in poverty, and that's true.

MS. SMALLWOOD: We haven't heard anything about your responsibility.

HON. MR. JACOBSEN: My responsibility is to try to ensure that we deal with the problem in the best way we can. I don't think that government goes out and creates the situation in society that you are describing, but we have to deal with it. We have responsibilities as government to deal with it, and we certainly do that to the very best of our ability.

We have policies that I think are supportive and caring, and that serve families to try and keep families together. We work with a lot of people in trying to overcome difficulties that they face. Just as a point to illustrate that, we have somewhere in excess of 30,000 complaints each year, where we are told that there is a problem within a family. It might suggest abuse; it might suggest a number of things. We do investigations on those, and unfortunately about 10 percent of them end up with the apprehension of the child having to be made for the protection of that child. We're reviewing the legislation that deals with that. But the other nine out of ten we are able to deal with, in such ways as to help the people overcome their problems. Sometimes we provide help within the home to assist families, sometimes we provide counselling services, and sometimes we arrange agreements where one partner lives outside of the home for a time so the family can heal. We do a lot of things to strengthen families and bring them together. I don't know that the member has very good grounds to suggest that this government is not concerned and not doing what can properly be done to deal with the problems of families. I think we do a great deal and are trying to do it better, obviously.

We have offered to review our legislation in line with our policy on children so we will have even better legislation, although it is certainly as good as other existing legislation in Canada. We consult with the rest of the country. We do not work in isolation, because other provinces learn from what we do in British Columbia. We have many requests for how we deal with the mentally handicapped, children and families.

We seek also from other places, and we know that in places like Ontario and other provinces, they have gone through a review similar to what we're proposing. In every one of the cases, they said to take at least two years before we draft any legislation, because if we do it any quicker than that it won't be done properly. Society will not be happy with it, because people will not have had the opportunity to really have the input that they deserve and need to have in this process. We have had experience in this too, so we know that it takes time. The timetable is not one that was made frivolously or uncaringly, but it's something that's necessary.

MR. ROSE: Gosh, I'm sorry to be laughing when I'm on TV and not even a comedian, but I just received a question from the House Leader about whether or not we'd be finished this set of the estimates by six. Maybe at six a week from now. That's possible, but we're not sure, because we have a lot of things to talk about.

The minister seemed a bit affronted when my colleague asked him certain questions about what he was doing for children and the length of time it was going to take him to do all these studies. The minister was offended because I think he sees himself as a warm and caring man, and it hurts him when questions like this arise that imply that he's some sort of callous, hard-hearted grinch. It's very difficult for someone who has that view of himself to really be able to accept these criticisms.

[ Page 12949 ]

[Mr. De Jong in the chair.]

We've just been dealing with childhood poverty. I'd like to move over to another section called the second childhood, which deals with people who are my age. I took this question up with the minister a year ago. I'm not sure if he was the minister the year before that, but I've been raising this now for at least the five years that I've been here. This is becoming one of my favourite speeches. I don't think anybody else likes it, but I'm quite fond of it.

I asked the minister last year if he knew that of the 2.5 million old age pensioners — over-65ers — in Canada, more than half were eligible and received not only the old age pension but the supplement. How do you qualify to reach the supplement? You qualify to reach the supplement if you're broke. It is a second pension which has a means test attached to it, and that's the only way you can qualify. If you're even broker — if that comparative is acceptable grammatically — you can apply for the beneficent gift of a legislation safety net in British Columbia called GAIN.

Here's the problem. Each year, as inflation eats away at our incomes, the GIS is indexed along with the old age pension — about three or four times a year. I'm not precisely sure which it is.

What happens is that as the GIS index and pensions improve because there's a lid on the GAIN contributions, that portion of indexing that people receive because the cost-of-living increase is confiscated. It's confiscated by your department, Mr. Minister. That policy has been offensive to me for many years, and I'm sure it hurts other people.

The assumption is that somehow people are victims of inflation in other jurisdictions all across Canada except British Columbia. The protection that the federal government grants this group of people who are eligible for GIS and GAIN.... Somehow they are not vulnerable to cost-of-living increases of various kinds — rent, food, transportation, heating costs and you name it. Nobody who gets GAIN, that I know of, drives a Cadillac. They have a big struggle to get along, especially if they're in the city, if they have no other income.

I brought this policy before you last year, Mr. Minister, and I'm expecting some action on it, because I do believe you are not a hard-hearted, callous grinch, no matter what somebody might imply about your personality. As a valued colleague.... We come from the same community and attended the same high school. I'm well aware of your background, and I think it would be unfair. You might be ignorant about this, you might have forgotten. But I'd like some indication that perhaps you are considering ceasing what I would regard as a hard-hearted policy of confiscation of indexed benefits from GIS for those people who receive GAIN.

HON. MR. JACOBSEN: Well, I can understand where the member is coming from. It wasn't me that you asked a year ago, but so be it.

Interjection.

HON. MR. JACOBSEN: No, it wasn't. It wasn't me the year before that, either.

Interjection.

HON. MR. JACOBSEN: Well, I came in halfway through the estimates a year ago, if you remember. You had spent 14 hours asking questions before I got here, so you only asked me for another ten or so. I don't think you had time to get that in.

Anyway, the problem is simply this. You're taking the GAIN program in British Columbia and looking at it as a pension benefit. You're really treating it as such in the way you calculate. It is not that; it was never intended to be that; it doesn't apply that way to anyone else. So of course it doesn't apply that way to seniors. We would like to be as generous as you suggest, but we have to recognize that there are limitations on how much we can afford to spend.

Because GAIN is a safety net, and because it is calculated on the basis of the amount of income that you get, it brings the recipient up to a certain level and makes the difference between the level that is deemed to be the appropriate level of the GAIN program in comparison to their income. If they're minus income to bring themselves up to that level, then we make up that gap by the GAIN program. But as your income increases, it takes less, of course, to bring you up to the GAIN level. So the GAIN level is a safety net to maintain you at a specific level that you will not fall below. The less income you have, the more we help you. If your income goes down — as it does, perhaps not so much for seniors, but it does for a lot of other people that depend on the program — we pay more. But if it comes up, we pay less. We're only guaranteeing a level of income.

MR. ROSE: I'm sure, Mr. Chairman, that the minister must remember giving that speech last year. This is the same kind of obfuscation and lip-flap that we got last year. How long has it been since you changed the GAIN? We're not asking you to increase the GAIN. All we're asking you to do is let it pass through. You know, get out of the way. You either lead, follow or get out of the way. That's what you are — you're in the way. Safety net! You're a butterfly net, taking the extra money that comes from Ottawa and slapping it into the GAIN program.

How long is it since we've had any review of GAIN to at least bring it up equal to inflation?

HON. MR. JACOBSEN: We have periodic reviews of GAIN, and it is increased. When it's increased, your level goes up according to that increase.

Interjection.

HON. MR. JACOBSEN: We've got the list, and we can dig it out. We've done it often; it happens quite regularly.

Interjection.

[ Page 12950 ]

HON. MR. JACOBSEN: Yes, it does. You'd be surprised. We'll dig it out, sure — it's there.

I want to tell you that you're not alone in Canada, because some provinces don't have the GAIN for Seniors program; we do. That's something. I'm told that the other provinces that have it deduct it exactly the same as we do.

MR. ROSE: I'd be interested in hearing about the periodic reviews. But the minister is saying that B.C., along with other provinces, is equally culpable.

MS. SMALLWOOD: Since the member raised this issue, I wanted to add another example of where the government creams off money that people need. We talked earlier about the increased earning exemption for people on disability pensions, handicap or welfare, and not allowing people to keep more of what they earn. Now we're hearing about pensions.

Here's another one, Mr. Minister, to do with family maintenance enforcement. Mr. N. has the distinction of being the first on the family maintenance enforcement program. His wife is on social assistance. It was mandatory for her to enrol in the maintenance enforcement program. The government then took over the collection, disbursing the support payments. Mr. N. was paying his two children $151 a month. He did not mind paying this, even though his children were only receiving $100 of that. The policy of the government saw the $51 going back into social assistance.

[5:15]

Mr. N. was in a serious auto accident. It left him unable to return to his job, and his payments for support were in arrears. Since then he has been able to get that money together for those arrears, in the amount of $1,057. He has the money in the bank. But the reality is that if he paid it to his family, his children would get no benefit from that payment, because it would go into income assistance — another instance where, because of the nature of the ministry's policies, money going to a family for support of those children will not benefit the children. Instead it will go into a bank account for the ministry. Perhaps you can make some reference to that.

HON. MR. JACOBSEN: Yes, I can make reference to that. I wonder what the member opposite is suggesting. Is the member suggesting that if a maintenance payment comes to the family, we should just simply add that to the social assistance? Isn't the purpose of that to help support the family? We support the family up to a specific amount per month, and if a family receives maintenance, they're allowed to keep a portion of it without having it deducted from their income.

I want to tell you that we're the only province in Canada that allows that, unless Ontario has changed now to be like us. Newfoundland was the last one, and they cut it out a while ago. They take off 100 cents on the dollar. They say that if a spouse contributes to the maintenance of his family, it's a responsibility he should have had in the first place. The government is not going to subsidize that. The GAIN program is what it is. But we allow them to keep $100 of that because we want it to be an encouragement for people to collect them. Spouses should look after their dependents.

MS. SMALLWOOD: What I'm suggesting to you is that people on income assistance in this province don't get enough to feed their kids. What I'm suggesting to you is that your policies are so restrictive and punitive that they don't deal with realities such as this. What I'm suggesting to you is that there should be an averaging program so if a person supporting their children is in arrears, averaging over a certain length of time enables him to catch up on those arrears and have the kids benefit. That's what I'm saying to you. With the policies you have right now, there is no incentive for the father to catch up on his arrears. The only people suffering from your policies are the children.

Income assistance is not enough in this province. We have to start looking at policies that allow people to keep more of earned and unearned income and to top up their welfare payments. We have to have an averaging policy that deals with more than one month at a time. This is a prime example of an instance where an averaging policy would allow that father to catch up on his arrears, would benefit the children, and over the year's income would not alter the family income all that much. Just one suggestion to you, Mr. Minister.

HON. MR. JACOBSEN: In those months when that maintenance was not provided, it was the government that made up for the lack of payment by giving the family their full support allowance. In the months when the maintenance did not come through, it was the government that made up that difference by providing the full allowance to that family. When the money does come through, isn't it appropriate that the province should have returned the money they spent on those previous months? What's wrong with that? That's as fair as anything can be. You have to measure this against the families on social assistance who don't have the benefit of the maintenance program.

We help people obtain maintenance. We do a lot towards ensuring that the spouses pay maintenance. We do allow the families to benefit from maintenance paid, and we're the only province in Canada that allows that. If we were to follow the proposal you indicate, we would then have two classes of people on social assistance: one class fortunate enough to be getting maintenance support in addition to social assistance and others who would have to live on social assistance. Where is the equity in that system?

I've listened very carefully to all the things you've advocated. What you're advocating — for all people to see who watch this — is a system that will be exactly the same as the system in place in Ontario, and British Columbians will decide whether they want that or not.

MS. SMALLWOOD: I want to continue with the minister's policy on children and the UN convention. I want to talk about article 6 and refer to some of those statistics on infant mortality. I'm reminding the minister that your government has supported this. Article 6 calls on the state to ensure, to the maximum extent possible, the survival and development of the child. I

[ Page 12951 ]

would suggest that with your policy on GAIN and refusing to allow families to keep larger amounts of their earned and unearned income, that you are perpetuating the statistics that we read in earlier on infant mortality and mortality rates due to accidents in poor neighbourhoods.

Article 7 says that a child should not be separated from his/her parent against their will, except when determined by a competent authority and judicial review. Yet we know by the ombudsman's experience that far too many children are apprehended when the family should be helped by family support workers to keep the family intact.

I began the estimates talking about where we spend money and how effective that money is. It is clear that the family support workers and the child care workers help to keep families together. We're showing statistics now, according to some of the criticisms and issues that the ombudsman pointed out, that family support workers and child care workers could intervene in a crisis situation — indeed prior to that crisis situation — to help keep families together.

I'm hoping that with the policies you've laid out you can tell us something about what your government is doing or is planning to do in the very near future that will support families in keeping them together, rather than intervening and separating families.

HON. MR. JACOBSEN: If the member thinks that there is an easy alternative in dealing with cases of child abuse, then the member is not really aware of the realities. But I think the member does understand the realities, so I know that she understands the difficulties of the problem.

What we are doing and what we have been doing for some time is everything we possibly can to keep the family together. That is the first priority, and that is explored before any other action is taken. But the act in British Columbia first of all makes it a responsibility by law that if you or I or anyone else is aware of child abuse taking place, we have a responsibility to make that known. We have to report it.

Secondly, the law states that when a social worker is advised that there is suspected child abuse taking place, that social worker must investigate. There is no choice. Once that social worker investigates, that social worker then has to make a judgment call as to what kind of risk the child is facing. That social worker does not do this alone. The social worker consults a supervisor and goes over the case with that supervisor to determine whether or not the decision is appropriate. They also consult with the police; very often they consult with medical authorities. But the final responsibility lies with the social worker. If something happens to that particular child in the intervening period, the social worker would be the one who would be criticized and held accountable.

I can tell you that I'm sure that every case is not handled perfectly; I recognize that. We have a review of the legislation underway to look at better ways of dealing with problems and how we might in fact minimize the intervention of the government — particularly of the social worker, particularly in apprehending children. We have to find better ways to deal with the family.

Regardless of those initiatives, unfortunately there are still many cases where there's little option and where the risks are so high that it is the social worker's opinion — and they have experience in dealing with these cases on an ongoing basis — that apprehension is the only way that they can safeguard the interests of a child. Then they apprehend.

MS. SMALLWOOD: I want to remind the minister that the ombudsman points out in his report that there have been too many apprehensions in this province. I want to remind the minister that not too many years ago there were programs in this province that.... If a family was in crisis; if they were having difficulty with family relations, whether it was an abusive situation — an adult abusing a child or indeed a child abusing the family — there were programs in place where the ministry would help that family with a child care worker, where that worker could work with the child to help deal with some of the problems before they escalated to a crisis; family support programs, where they would go in and help with parenting, and try to mediate difficulties, and try to ensure the safety of the children, rather than waiting until there was no alternative but to take a child out of the family.

I might suggest to the minister that that in and of itself is a horrendous message for a child. Taking a child away from the family, regardless of the abuse, is a horrendous message. The professionals and the caregivers in the province go to the child and say: "This is not your fault. You haven't done anything wrong, It's not your fault that your daddy is abusing you." But what happens is that the kid gets taken out of the home.

There are different ways of dealing with these problems, things that don't give these kinds of dual messages to children, where you tell them, "Trust us; it's not your fault," but then it's the kid that gets taken away. Kids know, and they begin to build into themselves that messaging: not only is it their fault, because they're being punished, but you can't trust adults, because I'm getting such a mixed message. They're telling me I'm not at fault, but I'm the one that's away from my mom and my sisters and brothers.

Listening to the professionals in the field and reading study after study in other jurisdictions, it is very clear that there are other options, other ways of supporting families in working through these difficulties, ways of saving families.

I agree with the minister: there are occasions where you don't have options. I don't want to understate that in any way. But I think that we can diminish the number of children taken into protection and diminish the number of families ultimately broken up. Even if in the good judgment of a social worker a child must be taken into protection while the court cases go on and the investigations go on and all the rest of that, depending on the age of that child, every day away from the family means time away that is necessary for resolving problems. It diminishes the bonding between that child and the parents and siblings, and it makes it

[ Page 12952 ]

all that much more difficult should it be deemed not to be a problem for that child to re-enter the family and for that family to accept them.

[5:30]

So this government — any government — has got to look for alternatives. We talked earlier about more cost-effective alternatives. Prevention is a lot cheaper than intervention. In the long run, it's very clear that it's better for the child as well as for the family.

Articles 12 and 13 establish the right of children to express their views, particularly regarding proceedings affecting them directly and the right to information. I wonder what the minister can tell us about a policy statement on the rights of children, and what you have done to ensure the right of children to participate in the development of their own care plan and to information on their files. Again, the reality is that kids feel quite isolated in this whole process. They feel quite powerless. This is something that doesn't cost money, but if the government would recognize....

I would point out to the minister that two years ago I brought into this Legislature a private member's bill outlining the specific rights of children in the care of the province. Maybe the minister could inform the committee as to what the ministry is doing around the rights of children to have a say in their life plans, once they have been taken into care.

HON. MR. JACOBSEN: I agree entirely with the remarks that were made by the member opposite. They were quite lengthy, but I agree with the member entirely in the comments that she made. I want to point out that all of the things the member mentioned should be provided are provided on a grand scale in British Columbia.

Our first priority is early intervention. We do provide all of those services that you listed — every single one of them. As I said before, apprehension of the child is the very last resort. The fact is that between 1989 and 1990 there were 7.7 percent fewer children in care in British Columbia than there were in the year before. Despite the fact that the population is increasing, we have fewer children in care. Thankfully that total is coming down. So the effort is certainly to make sure that we do not separate children from their families. We realize the traumatic circumstances that that involves. But I think we can all appreciate that it's not very pleasant for a child to live in some of the abusive situations that exist either.

In fairness, the member said that she recognized that there were certainly cases where there were no other options but to apprehend. I'd like to think that those are the ones where apprehension is made. We may make mistakes — I'm sure we do at times — but we try to do the best job we can, and the emphasis is precisely as the member has said.

The other thing that I'd like to point out is that almost half the children in care in British Columbia are children that are placed in care by the parents. The parents come to the ministry and ask them to take their children into care. And the majority of children in care are only in care for a few months and they're returned home. The system works a lot better than the impression that we're left with here if we listen to the debate. It's not nearly as obtrusive and severe as is indicated here. We make every effort to minimize the separation between child and parent, because we know that there's a bonding there that nothing else can take the place of.

MS. SMALLWOOD: I can't help but comment on the minister's providing information that half of the children in care are there because their parents asked that they be taken into care. That reminds me of the infant development program, and I'll bring some of that information to the minister later in the estimates.

One of the cases on a waiting-list there is a situation where the family is desperately trying to decide whether or not they are going to be able to provide the care needed for an infant. Part of that decision is whether or not the community services are there to help them care for that child. Again and again it comes to the fact that the services aren't there in the community. The income support is not there for the family, so the family has no option but to relinquish the children to care.

It would be very interesting to look at statistics as to why the parents are asking the ministry to take over the care of half of those children. Perhaps the minister could give us some more information about that.

HON. MR. JACOBSEN: The reasons are many. Parents' mental and emotional condition accounts for 13.8 percent; parents' physical illness accounts for 3.3 percent; marital conflict, 0.8 percent; parent-child conflict, 17.6 percent; waiting adoption placement, 0.6 percent; child mental-emotional condition, 3.1 percent; child's physical handicap, 0.3 percent; child's mental retardation, 0.5 percent; child's emotional disability, 1.2 percent; physical abuse, 9.7 percent; sexual abuse, 3.7 percent; abandonment, 5.3 percent; death of caregiver, 0.4 percent; absence of parents, 6.7 percent; disability of parent, 13 percent; neglect of parents, 9.9 percent. So the list goes on with a few more. But that gives you the scope.

MS. SMALLWOOD: Mr. Minister, what you've done is thrown in all the stats about all the kids in care. My question was: why do parents relinquish their children? They don't relinquish their children because they are sexually abusing them. That isn't the parents' initiative. Those are children taken into care because they are being abused. Perhaps the minister could be more specific about the statistics. When the minister is talking about children relinquished because of mental or physical handicaps it begs the question that if the supports were there in the community, then perhaps the parents would be more able to look after those children. It's very clear that some parents relinquish their children, according to your statistics, because they die. But it fogs the issue — and using the minister's own statements — that over half of the children in care are relinquished voluntarily by their parents. Could you refer more specifically to why the parents voluntarily relinquish those children?

[ Page 12953 ]

HON. MR. JACOBSEN: It's not over half; I said "nearly half" of the children that come into care. I may be wrong on this, but I think it's 46 percent.

Interjection.

HON. MR. JACOBSEN: Forty-three percent of the children who come into care are placed in care by the parent. The reasons I listed account for all of the children who come into care through different means. Many items I listed are where the parent puts them into care on account of those reasons. The biggest single item is respite. They put them into care by agreement, with the understanding that they will return home, often in a short time; there is an understanding about that. The other reason they put them into care is medical problems in the family. They ask the ministry to help them look after their children. It's a request, you'll remember, from the family to the ministry. Another big reason is emotional problems.

There are people having a hard struggle. It's a difficult circumstance; there's no question about that. We cooperate with them to provide assistance in looking after the children for a period of time, for the parent or parents to be able to overcome their problem and resume care of their children.

MR. VANDER ZALM: I would like to participate a little now, and then perhaps again tomorrow I'll raise some specific issues that I would like to have some answers on. I've listened to members of the opposition raise a number of issues. In particular, I followed the comments made by the member for Coquitlam-Moody, who was impressing upon the minister and the ministry the need for increases in rates provided to the recipients of GAIN.

First of all, I want to commend the minister and the ministry for the progress made. I think the Ministry of Social Services and Housing has done a commendable job over the past many years — not to suggest that you've always been able to respond to all of the demands of all the people in the various categories of those in society who require assistance from the ministry. But certainly overall I think you've done a commendable job in addressing those needs as fairly as possible within the resources available to government.

Often members of the opposition tend to overlook that. They tend to view government as a bottomless pit. I guess in part it's because they really haven't had too much experience in governing; they've only occupied that position once and for a relatively short time in this province. They tend to take the approach that taxpayers can always pour in more; and therefore we could provide whatever increases might be requested. It would be nice; we'd all like to see more benefits made available to those very needy groups, but there is a limit.

I only say this to compliment the ministry for the job that has been done. Given difficult circumstances, you've done a tremendous job. Knowing some of the people involved in the ministry — having been there myself one time — I know that you're working with an excellent staff, an excellent group of people that are very committed and dedicated, and they've done a good job.

Interjection.

[Mr. Pelton in the chair.]

MR. VANDER ZALM: I hear the heckling from the NDP: "Do you still hand out shovels?" They say it as if the shovel is something dirty that we can't make reference to. I made that shovel comment some time ago, and...

AN HON. MEMBER: It's famous. It's your trademark.

MR. VANDER ZALM: He says: "It's your trademark." I've raised a lot of money for a lot of good causes selling these shovel packages, and it's been a good message people can relate to. The average British Columbian recognizes that if we can assist people in getting them a job and having them involved in various activities that make them feel like a productive part of society in the normal way, that is good for them; and that is good for us. Everyone wins by that.

The opposition think that providing opportunities for people to find employment and to be involved in society in a normal way is some nasty thing. I can understand why they might think this, because as I said, for the most part, they have not — at least some of these people here that are doing all of the chanting and shouting from the side — been all that successful in achieving some of those things that all of us on this side of the House feel are a credit to society and worthwhile to work towards.

[5:45]

It's also an example. Particularly the member from Victoria, who does a lot of jabbering, must be aware that what we see happening in Ontario today is shameful and is something that British Columbians view as a shameful thing. It's certainly a hindrance and detriment, not only to those who live in Ontario, and it impacts and affects people across the country. The Ontario example of what they're doing within the social services system is a horrendous disaster. It's an example of NDP inefficiency, sloppy administration, waste and inability to govern and provide good programs to people in a sustainable way. The member for Victoria, who has been jabbering from the side here, knows that. He knows that Ontario has done such a terrible job that he doesn't want to see it referred to as an example of NDP mismanagement.

I go on to say, Mr. Minister, that I commend you for a job so well done. I commend the staff for the job they continue to do, not only in the offices here in Victoria — and I've had some rapport with people in the offices in Victoria — but throughout the whole of the province, in the offices of communities like mine, Richmond, and in Delta, Surrey, White Rock, Prince George, Prince Rupert and Smithers. All across this province where we face oftentimes many difficult problems.... It's no easy task for the people in your ministry to address some of those difficult problems.

[ Page 12954 ]

They are often the most difficult problems in society. But we must address them. As people in government we're committed to assist those who are less fortunate, and we try to do as good a job as possible within the resources given us.

I am particularly pleased, and as I said, I'll be raising some specific programs in debate tomorrow. I don't know the agenda for tonight. I'm hoping we'll go until at least 10 o'clock and that we'll have a further opportunity.... I want to see a lot of work done in this Legislature. I think that's good. We're here on behalf of the taxpayers, and we want to put in the time as effectively as possible debating these issues. While I will be raising that tonight or tomorrow, I wanted some comments from you on the in-home care program. I'm not sure that I've got the right name for the program, but it certainly has been a tremendous assistance to a great many people across this province — for example, when a family has a severely handicapped child, and we provide these services in the home to the family.

It's those people with handicapped children or people suffering from handicaps or disabilities who I think we really want to provide assistance to in whatever form in order to best give them some relief. I'm very impressed with that program. I have had many very positive comments from a lot of people throughout this province. Before we adjourn this afternoon, could you give me some of the results and the findings after the program has been in effect for about a year now? Tell us what it has done. Could you give some details on where these programs are working most effectively? It's one of those programs that I am extremely supportive of.

Again, Mr. Minister, I realize time is short this afternoon. You may want to leave this for later, but if you could provide me with some information, that would be helpful. I will be speaking about some of the specifics — especially things that are happening in my constituency, some of the programs in effect there and the tremendous assistance given to people in Richmond.

I thank the ministry for the help, and if you could provide me with some information on the in-home care program, I would appreciate it.

HON. MR. JACOBSEN: I would be happy to provide information on the in-home program. Perhaps the member for Surrey-Guildford-Whalley would be interested in that program too, because not very long ago we talked about my estimates. It was a brief thing, but it dealt with the spending until and before the end of the past year.

We talked about the at-home program. During that discussion the member said — and I'm reading from the records now:

"If the program was designed by the parents, they would have accessed it much more easily."

I countered by saying that the advice that I had was that the program in fact was formulated on the advice of parent groups. The response came back from the member:

"I have had fairly close contact with the associations of parents and handicapped children. While they have been lobbying the ministry for a number of years leading up to the development of that program, those same parents were never consulted as to the design of the program."

Well, it's interesting, and it's one of the things that makes it difficult dealing with some of the questions opposite. As a matter of fact, the program was designed from a direct role of parents. Parents were the ones that had the say on the type of program that it would be. The parent groups involved were the B.C. Association for Community Living, Spina Bifida Association, the Parents' Advisory Committee of the Arbutus Society, the Association for Persons with Severe Handicaps, the Muscular Dystrophy Association and the Premier's Advisory Council for Persons with Disabilities.

The group met a number of times both before and after the inception of the program, and in fact its opinion was formally sought as recently as June 5, 1991. Not only did the committee influence the program; it actively and dramatically shaped the policies and procedures associated with both eligibility and benefits. For example, it was the committee that recommended that parents directly participate in determining eligibility. As a result, the board determining eligibility not only included parents but it is chaired by a parent of a severely handicapped child. So the program has been totally designed by parents to meet the needs of parents.

The usage of the program is increasing. In '90-91 we spent $1.25 million on the program, and the children that were subsidized totalled 960. This year we have a budget of $4,060,000, and it's anticipated that we will subsidize something like 1,300 children through the program. It is an expanding program. Since the program was started in '89-90 we have been there to support and deal with every application that has come forward. In fact, we had more money in the budget for the program than was taken up. As the program is being developed and as more people are aware of it, there is an increase in take-up. This year we are looking forward to being able to serve 1,300 children through that program.

MS. SMALLWOOD: I think, given the time, that I would like to end on a positive note. The parent groups that lobbied for that program for so long, that had promise after promise from the ministry — and there were a couple of promises before that program ever actually materialized.... It was not until very shortly after two kids and their families actually came over here that the government announced the program.

One of the children who came over was Ryan Bonson. He is ventilator-dependent and very severely handicapped. I would like to tell the minister that, thanks to the work of his parents and the support of the ministry, Ryan is home, in his community, with his family and in his community school.

I have followed Ryan's progress, and just recently have checked with some contacts I have at Children's Hospital. Ryan goes back to the hospital periodically for checkups, and they tell me that they have never seen such great improvement in a kid. Ryan is a

[ Page 12955 ]

spunky, strong kid to begin with, but because of the support of his parents and just the kind of kid he is, he is doing very well. The professionals in the field remark on how well and how much he has grown since he has been able to be back in his community. So on a positive note, I want to acknowledge the good move that the ministry has made in supporting families to allow kids to grow up where they should be growing up — in their own communities.

MR. REID: Mr. Chairman, I draw your attention to the clock. I move the committee rise and report progress and ask leave to sit again.

Motion approved.

The House resumed; Mr. Ree in the chair.

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

RANGE AMENDMENT ACT, 1991

The House in committee on Bill 5; Mr. Pelton in the chair.

On section 1.

MR. BARLEE: As I mentioned yesterday, we have no real problems with the Range Amendment Act. The minister knows that. But there are some questions. The Range Amendment Act is another amendment act, but does the minister not think that the entire Range Act should have been revised before bringing in an amendment act? The original act is really flawed and should be revised. What are the minister's thoughts on that?

HON. MR. RICHMOND: I said yesterday in second reading of this bill that we had done substantial work on a range review with the objective of bringing in a new Range Act. That will eventually happen. It's just that time is of the essence on some of these amendments, and we didn't want to have to wait until a whole new act was drafted. But it will be. Since our range review is complete, we'll be drafting a new act, and I agreed with that. Rather than say that the present act is flawed, more accurately I would say that, like all things, it is probably out of date; it has just become outdated with time. I think these amendments are very positive steps to update it, probably on an interim basis, until a new Range Act is drafted and brought into this Legislature.

MR. BARLEE: Has the minister got any more definite time-line on the new act coming down the pike? Will that be within the year or a year and a half? What is your thought on that?

HON. MR. RICHMOND: I would think that a new Range Act would be introduced into this House within a year.

[6:00]

MR. BARLEE: I thank the minister for that answer. There are some problems expressed by some of the people we've consulted with. Indeed, you have done some wide consultation on this. Some of the other users — besides forestry users — are a little concerned that Forests may be a superministry. Is there enough provision in this act for them to consult with other ministries, such as the Ministry of Agriculture, say, if there's a conflict between ranchers and the Ministry of Forests? Is there an adequate checks-and-balances system incorporated into this amendment?

HON. MR. RICHMOND: I'm just trying to find the appropriate section. The way the amendment is written is that the regional manager will have the say on all matters, and most members would agree that that's a good move, because they're a lot closer to what's happening. They usually understand the local problems better. I point out to the member — in all sincerity — that every person in this province, whether they be a rancher, a sawmill operator, a recreational user or whoever, always has recourse to their elected member as the court of last resort. In cases where the regional manager has made a decision and parties cannot agree, they always have that appeal through their MLA to the minister.

Section 1 approved.

On section 2.

MR. BARLEE: We know this is a very touchy issue. When you start changing the boundaries under a licence permit, we wonder whether or not it's.... Do you foresee any real problems in this area? When you start changing the permits of individual licence-holders, I can see some real problems, because it's something like the water permits.

HON. MR. RICHMOND: Most boundary changes would take place at the request of the tenure-holder — at the request of the person holding the permit or the lease. Some would take place because of the construction of a highway or something similar, and of course, that is when you would get into compensation or negotiation in a dispute settlement mechanism, etc. They would be the anomaly. Most boundary changes would not be of that nature, and most would be at the request of the permittee or the lessee.

MR. MILLER: Could the minister describe what the imperative was for the change. Clearly, in transferring it from the minister to the regional manager, there was obviously some perceived need to do that — whether that was the speed at which those decisions were made or whatever. Perhaps the minister could outline why that change is being brought in.

HON. MR. RICHMOND: The change was made simply to make the system more efficient and more responsive. The way it's written now, the minister has to approve all boundary changes, and we felt that the regional manager was the person best equipped to deal

[ Page 12956 ]

with it, knowing the situation better, being closer to it and being administratively much more efficient.

MR. MILLER: As it stands now, the regional manager would, in a de facto sense, make the decision and pass it up to the minister's office, and presumably the minister would take the advice of his officials and approve it. Is that substantially what is happening now?

HON. MR. RICHMOND: Sure, that's what's happening now. But as I said to the previous member, I always like to have that court of last resort available to any taxpayer, any citizen, of the province. When the minister hasn't made the final decision, and the regional manager makes it, then any taxpayer has the right to appeal to the elected person, through his or her MLA, to come to the minister if they don't feel the decision has been fair.

MR. MILLER: That was going to be my next question. It clearly comes in another section, and I wanted to get to that. Do you feel that by the minister not making the decision, the appeal of decisions would therefore appear to be fairer or more objective?

HON. MR. RICHMOND: As you've pointed out, I think the same person would probably be making the decisions, except in this case you have another person you can go to to appeal. If in your first scenario the regional manager makes the decisions and sends them up to the minister, the minister has to sign them all, and there's really no appeal to that. The final authority is there, and it's done. This way, you always have that one final out: if the person doesn't feel the decision is fair, he can go to his elected member and ask for an appointment with the minister and plead his case. The minister can then say yes or no, or "I agree with the regional manager," or "Somewhere in the middle there's a compromise."

MR. MILLER: Finally — and maybe it's not in the form of a question, but in terms of the whole management — it's been my experience that senior management tends to back up management at a lower level. Of course, there are a few dimensions to that. One is that you wouldn't want to get into a situation where you were constantly overturning decisions made by your regional managers. You'd be undermining them and probably making them nervous about making decisions.

So I'm not absolutely convinced. I can see some merit in the thing, and we're obviously not going to oppose it. I'll leave it at that.

Section 2 approved.

On section 3.

MR. BARLEE: We think the formula is reasonable, and it seems to me more generous than the formula of last year. Would the minister care to comment on that?

It's fairly important. Is it more generous than last year's formula?

HON. MR. RICHMOND: The formula is more generous than that which was in place before. Beyond that, it allows us as a ministry to completely replace an improvement that has been lost due to a boundary change, it allows us to go in and replace it. So it's a better written and more generous compensation package.

MR. BARLEE: We assumed that it was a more generous formula. So therefore the people who applied for compensation last year were essentially penalized. Is there any provision to provide them with some justice in this? People who went under the old formula have not been adequately compensated. I'd like the minister's response on that.

HON. MR. RICHMOND: That's a good question, but I can advise the member that no one applied for any compensation. So it's a moot point.

MR. ZIRNHELT: Last year during debate on a similar provision, we raised the issue of some of the concerns that the B.C. Cattlemen's Association had raised. Has this formula now been based on the consultations with that organization, and does it meet their criticism of the previous bill?

HON. MR. RICHMOND: Yes, as I explained yesterday, we had extensive consultation with the ranching community, and they seem to be quite satisfied with the amendments we are bringing forward.

MR. ZIRNHELT: Thank you. I just wanted that for the record, since we haven't had extensive consultations, because we don't have the staff to do that.

My other concern is on the nature of compensation and the fact that the Crown is potentially incurring liabilities here that might be bigger than they need to be — unless there's been very careful development planning with each licence. An example would be watersheds. There are cases throughout the Okanagan where municipal watersheds have cattle in them and are becoming quite a concern. It would appear from a purely economic analysis that the water is a more valuable resource, and the range less so. In order to provide for integrated use there, you might have to do extensive fencing. If you had to do quite a bit of fencing to do what has been suggested — keep the cattle away — what provision is there in the management planning of the licences to ensure that resources like water are taken care of in the planning so that if you have to move the boundaries or change or delete something from a permit, you've done some assessment of other values?

HON. MR. RICHMOND: There are some cases, as the member points out. There's one in the southern Okanagan now, at Naramata, that we are coming to grips with. In many cases you're going to have to deal with them as they do come up, and some decisions are

[ Page 12957 ]

going to have to be made as to whether you get into an extensive and expensive fencing program, or whether you just move the cattle out of a given area, if the people are concerned about the fecal coliform count. As we face these situations, we're going to have to make some trade-offs and some tough decisions as to exactly how to handle it. Fencing in some cases might be the answer, and in other cases it might be deleting that piece of land from range. We just might have to do that in some cases.

MR. BARLEE: Seeing the minister brought up some of those cases — certainly in Naramata, which I think the minister is very familiar with and which has been dragging on for some time — can the minister indicate to the House when this will be resolved? Both the ranchers and the people in the area are in direct conflict as to the use of this particular watershed. It's provided some problems for about a year and a half. Are you going to resolve that in the immediate future, or is it going to drag on forever?

HON. MR. RICHMOND: Although it's probably straying a little from this section — but we should talk about it because it's a pressing problem — the Solicitor-General, the other member for Boundary-Similkameen, has brought the problem to me, and we've gone over it extensively. We will be coming up with our answer to that bit of a dilemma at Naramata probably within the next week or ten days.

[6:15]

MR. VANDER ZALM: Mr. Chairman, I realize that we might be debating this bill all evening, therefore I'll have another opportunity. But on this particular section, I thought that the minister might tell me if this would eliminate the need for expropriation when there is a highway to be constructed through an area where there are range leases. Would the formula apply, or would the expropriation procedures apply? Is that one of the purposes of the formula, or could it be used in that sort of situation?

HON. MR. RICHMOND: I thank the member for his question. The formula is on page 3 of the bill. It does look a little like Einstein's theory of relativity, but it's really not. What the member is asking is.... We really do not expropriate land that's under licence or permit — it is Crown land. The formula is in the Range Act for repayment to the licensee or permittee, to determine how much compensation.

As you may recall, this was a contentious issue last year when the subject of expropriation came up regarding the Okanagan connector of the Coquihalla Highway. Some deeded land there had to be expropriated, and some Crown land, grazing licences and permits, had to be altered. So it got very confusing. It is a good question and a very complicated question. But there is a formula in place to deal with it.

MR. MILLER: It's a pleasure to see that the first member for Richmond is in training for his future role, perhaps as Leader of the Opposition. It's not too late.

Interjections.

MR. MILLER: I should clarify that — the future Leader of the Opposition. I would have thought that he, as the former Premier, I would have thought that he would have known the answers to these questions. But fair enough.

I have a couple of questions for the minister on section 3. First of all, with respect to the formula's first variable, the wording on "L" is: "the life expectancy, in years, of the improvement after the deletion, assuming the improvement is not maintained." That would seem to call into question some judgment in terms of.... Perhaps the minister might illustrate with a couple of examples. How long does a fence stand up after you leave it alone? It would seem to me that some of these things might be particularly difficult to work out. If it was a fence up in my neck of the woods, it would probably start to grow, but that may not be the case in the areas we're talking about. Is that a particular problem? Do you expect to work that out in an agreement with the party that constructed the improvement? Do you anticipate any difficulties in arriving at the figure that would represent the letter L?

HON. MR. RICHMOND: This is another case where the licensee or permittee and the ministry have to sit down and work it out, because it varies from year to year in a given area, depending on the snowpack, etc. So they have to sit down and work it out. Sometimes the life expectancy would be only two years; other times it would be much longer. In cases where they can't work it out, they would probably have to go to commercial arbitration if all else failed. If everything failed — if the regional manager couldn't agree with the rancher, and the minister couldn't resolve the problem — then commercial arbitration would be the way it would end up.

MR. MILLER: Finally, section 3(4) essentially allows compensation to be paid out before costs have been incurred. That would appear, on the face of it, to be a bit unusual. Normally one would compensate for costs that have been incurred. Clearly there must be a reason why....

AN HON. MEMBER: Fairness.

MR. MILLER: Well, fairness.... We're just trying to explore why this section is in there, which would appear to be a bit unusual. Perhaps the minister would like to explain.

HON. MR. RICHMOND: If you read on in the section, it's really in cases where not compensating the person up front would cause an undue hardship. If they just do not have the money to put in a fence or whatever, to be fair we would pay them in advance of them doing the work, because not to do so would cause an undue hardship on the person.

MR. MILLER: Therefore where there has been a deletion and new fencing, for example, might be

[ Page 12958 ]

required before compensation was payable for the area that was deleted, you could advance the money and allow that.... I see. Okay.

MR. BARLEE: Actually the minister raised a point. On that compensation, is there specific compensation for fence-building, for instance, in all of the areas of British Columbia? Or does that vary from area to area? Certainly there are areas in British Columbia where it's very difficult to put up a fence. You encounter rocky terrain, such as in the south Similkameen. In the Cariboo you have a lowland area, where it's probably much easier to put in fencing. I assume that the formula would fluctuate from area to area, depending upon the decision of the regional manager. Is that right? Or is there a fixed formula?

HON. MR. RICHMOND: If you look at the formula, all of those are variables, depending on where you happen to be. Costs which have been reasonably incurred.... It says: "the reasonable costs to the holder of the licence or permit of the improvement at the time it was made." So naturally it's going to vary from area to area. Those are all variable numbers, and subsection (4) is just to remove any financial burden on the person if it would cause an undue hardship on him or her to pay for all this up front and then be compensated. What we're saying is that if we have caused them to incur this expense, then we should pay it up front.

MR. BARLEE: But that is essentially a decision of the regional manager, not the ranchers. The rancher may say, "Well, it's costing me so much," but the regional manager may say: "Well, it doesn't cost you that much; it costs you much less." So is that essentially a decision by the regional manager or by the rancher involved, or in consultation with the regional manager?

HON. MR. RICHMOND: As I explained before, this is where they would have to sit down and come to an agreement. If they can't come to an agreement, then it would go to arbitration.

Section 3 approved.

On section 4.

MR. MILLER: I heard one of my colleagues describe this as a wide-ranging debate. It's not something I would have thought of myself.

With respect to section 4, we talked earlier about the previous change which allowed the regional manager to make a decision, thus freeing the minister in terms of any subsequent appeal that might be launched. Under subsection (4), it appears the minister can designate someone else to hear that appeal. I'd like the minister to elaborate on who that person, as defined in the section, might be.

HON. MR. RICHMOND: I would think that, if not the minister himself or herself, it could be anyone the minister chose to designate. I would think that could be someone from the local area — a party agreeable to both sides with knowledge of the industry and the area. It could be a retired rancher.

MR. CLARK: A politician.

HON. MR. RICHMOND: It could be a retired politician. Who knows? That wouldn't be agreeable to both sides. It could be anyone that the minister chose who is agreeable to both sides, if not the minister personally.

MR. MILLER: With respect to that it could almost be inferred that having appointed someone else, the minister would appear to be obliged to accept the recommendations of that party. Would that be the case?

HON. MR. RICHMOND: That is the case. Unlike other appeal provisions in the Range Act, there is no provision for an appeal from the decision of the minister or the minister's designate. When you have designated that person or made the decision yourself, that is fine.

Sections 4 and 5 approved.

Title approved.

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

Motion approved.

The House resumed; Mr. Ree in the chair.

Bill 5, Range Amendment Act, 1991, reported complete without amendment, read a third time and passed.

HON. MR. RICHMOND: Committee on Bill 6, Mr. Speaker.

PENSION BENEFITS STANDARDS ACT

The House in committee on Bill 6; Mr. Pelton in the chair.

On section 1.

MR. ROSE: I don't intend to revisit the second reading debate, because I have already made a comprehensive and brilliant speech on that subject.

It's worth noting that while we welcome the legislation, we have been really concerned about three major items: the idea of the employers giving contribution holidays to themselves; their own investment practices in which they can take the employees' money and invest it at a relatively low interest rate in their own firm; and the lack of indexing — how a person's purchasing power shrinks once he is retired. While we want it for ourselves in terms of MLAs' pensions, we

[ Page 12959 ]

are not requiring it for the private or public sectors' employment standards.

We have also said that we are extremely opposed to the scooping off of surpluses and the fact that the minister has given companies ample time by announcing it much earlier than necessary — in June with Bill 44. He gave them ample opportunity to scoop out the so-called surpluses, and this legislation does not cover that. That's kind of a warning. Instead of having the door close the day before, as we do on a federal or provincial budget, we have to give people warnings. Certain kinds of unscrupulous employers have ample opportunities....

Interjection.

MR. ROSE: Oh, the member from Cloverdale doesn't like the adjective.

Interjection.

MR. ROSE: I didn't say they were all unscrupulous; I just said it gives an unscrupulous employer an opportunity to scrape off so-called services.

I wanted to know — I expect that the minister will not be sitting there defenceless — whether or not he would care to introduce his officials, who are waiting in the wings to back him up on this. But let me say one more thing before we get into the meat of the deal.

[6:30]

On Tuesday night the minister said he would be most generous towards suggestions for amendments. He also made his officials available to us today, and we had a long talk. The sum and substance of that talk was really: "Well, I would like to accept amendments, but...." Mr. Chairman, I feel like I'm watching a tennis match. The sum and substance of the minister's generosity amounts to this: "If we accept amendments, then it has to go back to the legislative committee, to cabinet. While I'm quite willing, gosh, folks, I really can't do this."

We certainly appreciated the cooperation of a number of his officials — two of them: Mr. McCulloch, and he'll introduce the other gentleman later.

It doesn't really matter much if you're not going to do anything; you can be as open and as welcome as the flowers in May, but if you're not prepared to do anything, it makes little difference.

We want the bill; we've been calling for this bill for 50 years.

HON. S. HAGEN: We're bringing it in.

MR. ROSE: Actually, Mr. Minister of Education, it's 30 years after it was brought in in Ontario. You're the last one; you're the Rear-Admiral of Pension Benefits Standards Acts.

It doesn't really matter very much. If you bring in a bill that we welcome, if it's a wimp bill, then it makes very little difference. It doesn't really apply any standards; it doesn't really demand any standards. That's probably our biggest concern. The biggest concern is that, while we welcome the minister's cooperation and know that he's "a swell fellow," if he won't do anything, that isn't particularly helpful.

I understand that he's prepared to accept one of our 15 amendments. Our amendments were designed to strengthen the bill, to take the wimp out of it. But that has little or nothing to do with the subject at hand. I'm quite satisfied with the standards of the emoluments I invested in and paid for through my own contributions.

I just have one other thing I'd like to say....

MR. CHAIRMAN: It would be appreciated if one would be relevant to section 1. I'm sure your question will be.

MR. ROSE: Yes, I am, but this is really the principle....

MR. CHAIRMAN: I've been waiting for you to be.

MR. ROSE: Since the minister has brought in all of his officials to buttress his arguments.... If I could have unanimous consent to bring in our researcher to assist me, three to one seems fair.

I'd like to talk a little about the definitions and interpretations; that really is section 1. I intended to move a motion on this, because there are some things that are really left out. Let me deal with actuarial present values. "The value on a particular date of all the present and future entitlements of a pension is calculated taking into account all likely future salary accruals." "Actuary" means a fellow of the Canadian Institute of Actuaries. Well, there's no definition of this. There's nothing in the act that says this.

"Assets" is another thing left out: "...which should include the assets that in an ordinary course of business would be entered into the books of an account whether or not a particular asset is entered in the books of the account of the employer." We think a definition of "asset" should be in here. I know what the minister's going to say. He's going to say: "Well, folks, sure it isn't in there, but we can fix that up when we come to the regulations." Well, you know what? The bill gets House examination; regulations are really the property of the cabinet. I think that's important.

A bridging benefit is not listed here. It means "a periodic payment provided under a pension plan to a former member of the pension plan for a temporary period of time after retirement for the purpose of supplementing the former member's pension benefits until the former member is eligible to receive benefits under old age security or is either eligible for or commenced to receive retirement benefits under the Canada and Quebec Pension Plans." There's no bridging benefit defined here.

"Collective agreement." We'd like that to be spelled out as having precisely the same meaning as in the Industrial Relations Act. I can tell you what this is if you need that definition.

The commuted value of a pension is "the lump sum equivalent to a pension benefit as calculated at the time that this value is to be transferred out of the plan either

[ Page 12960 ]

in exercise of the portability rights under the statute or paid by way of pre-retirement death benefit."

"Trade union" should have the same meaning as in the Industrial Relations Act. Since I'm not going to move these definitions here in terms of an amendment to be added.... I say to the people out in videoland, this is pretty jargon-laden stuff and probably....

Interjection.

MR. ROSE: Yes, videoland. That reaches Courtenay and Comox and Cumberland and Campbell River.

Anyway, I wonder if the minister would care to comment on this plethora of points that I have just made.

HON. MR. RABBITT: I certainly enjoy it whenever the opposition House Leader rises to his feet, and his being an old schoolteacher, I'm sure I'll learn a few lessons this evening.

I should point out, hon. member, that although we may be the last province in British Columbia to bring it forward, we are bringing it forward. I remember a government back in '72-75 that had an opportunity and missed it as well, so I guess there is a time for everything.

We have looked at the amendments that you're referring to, and I believe some of them are well thought out. I believe that we can incorporate them in regulations, although you seem to pooh-pooh that concept.

Let's just touch on the first two you mentioned. Both "actuarial present value" and "assets" can be defined in regulations.

Interjection.

HON. MR. RABBITT: I will commit to you, hon. member, that when this bill is reviewed a year from now, if you're not satisfied with the way we have defined it in regulations, then fine, I'm willing to bring it forward in an amendment to the bill.

"Bridging benefit." We don't use that terminology in the bill, and I don't believe that the terminology has to be defined in our bill.

The term "collective agreement" — we have also noted that that can be defined in our regulations. I'm giving you a commitment that we'll define that in the regulations.

"Commuted value." We've already defined that in our bill.

"Trade union" is a terminology not specifically used in the bill and not required.

MS. MARZARI: Under definitions and interpretations, Mr. Minister, there's one definition under "administrator" — the people administering the pension plans themselves — and it has five parts. An administrator of a plan is defined as: a board of trustees or the employer for other plans that aren't multi-employer; a person appointed by the superintendent under section 56; the superintendent himself or herself; and this new item 4. I think the minister has a responsibility to speak to it.

If we are talking about pension plans and setting up a superintendent with an arm's-length relationship with government perceived by the public — pension plan holders, employees and employers alike — as a non-politically influenced body acting in their best interests, how did the administrator come to be a person appointed by the minister under section 71? The minister himself or herself is now capable, under section 71, of being defined as an administrator. What happened here? This did not appear in Bill 44 or Bill 89, but suddenly, sometime between March and May this year, something happened. The administrator can now be appointed by the minister under section 71.

Given the instability, let's say, of where this government is right now, why does the minister think it's desirable to go this route of becoming personally and directly involved with administering pension plans?

MR. ROSE: Who asked for it?

MS. MARZARI: Who asked for it? Where did it come from? Who lobbied for this, that we should suddenly find it inserted into Bill 6 in this sitting of this House, when we didn't see it in Bills 44 or 89? The superintendent is supposed to be a person at arm's length and a person of integrity. Ministers in this government are very vulnerable to receiving phone calls and pressure from their own friends — we know that. We've witnessed it on a number of occasions, most notably when the Minister of Environment — or the first member for Richmond — received phone calls, and instantly environmental standards became diluted. We're concerned about it, and we want to know how this tiny clause inserted itself into this particular bill.

HON. MR. RABBITT: I'm informed that it was, in fact, in Bill 89. The reason for its inclusion in Bill 6 is in the case of an emergency: where there has to be immediate and fast action taken, the minister is then empowered to do so. The policy staff for the ministry identified the situation where it could be necessary.

MR. ROSE: The minister is really saying that the bureaucrats inserted this; he really had no views on it. It wasn't Bills 44 and 89, and all of a sudden it's needed in Bill 6. The only trouble I have with it is that it tends to give the minister a political role here, whereas I think these things should be handled in a totally non-political way. So I do have some real problems with that. But to carry on, I think we've made the point. I don't think that judge, jury and executioner on these matters is a suitable role for government. I think it should be taken out of the political arena. But you can't stuff that into your regulations.

AN HON. MEMBER: The government should be taken out of the political arena?

MR. ROSE: A pension commission should be devoid of political constraints and political considerations. It doesn't matter which party is involved. The minister

[ Page 12961 ]

says that he's going to change it or add some things to it when he gets a chance. He may not get the chance. I'm quite sure the things we're suggesting will be considered in the review of this. It's been a long time coming, and if the minister has an opportunity, the best of luck to him; but if he doesn't, we'll look after it ourselves.

Another amendment we were considering in our caucus, along with our research people, includes the definition of "employee." We were concerned that home work or working out of the house, which is becoming increasingly common — where people take contract work home.... It has some advantages and disadvantages. One of the big advantages is that you are not clogging the highways; people are working with their computers at home. Unfortunately it lacks the advantages of the factory-type workplace or the school-type workplace — which is the same as a factory — in which the advantages of unions are obvious.

HON. S. HAGEN: He's still whining away.

MR. ROSE: It hasn't changed. The schools are still run as factories, Mr. Minister of Education.

If that person does home work for an employer or receives any instruction or training.... A lot of people are apprentices for up to ten years, and we want to make sure these people are covered. The Ontario Employment Standards Act — not a product of the present administration — ensures that people doing home work or house work plus trainees and apprentices are covered under the bill's definition. I'd like the minister to explain whether or not similar employment is covered under this bill and how it's going to be covered.

[6:45]

HON. MR. RABBITT: First of all, with regard to the necessity for the minister to have certain powers, a non-appealable suspension should not be the prerogative of a civil servant, but it should be the prerogative of the minister in making a decision on a suspension. It could be changed in the future. The necessity is there now to see that that accountability is here within the jurisdiction of this Legislative Assembly.

The definition of "employee," as I've been informed by my staff.... I should take a moment now and introduce my staff. I went ahead without doing that. I've got my deputy minister, Claude Heywood; on my far right, a policy specialist who's my expert in the pension field, Colin Aykroyd, and Bruce McCulloch, who is the director.

Interjection.

HON. MR. RABBITT: Some people blow their own horn, don't they?

We were talking about definition of "employee." My staff inform me that apprentices and homemakers are covered by this proposed legislation and by our definition, so there is no necessity to make the changes to the bill that you are proposing.

MS. MARZARI: It's kind of difficult to say that they are going to be included, Mr. Minister, because somewhere, as we proceed through this bill, we're going to find that the earnings level is $10,600 for someone to even begin to qualify for opting into this bill. Anybody who is earning less than $10,600 can't even think about contributing to a pension plan under this bill. This bill doesn't cover people who earn less. Minimum wage doesn't even make $10,600. I think the minister should mix and match some of the sections of this bill and connect some of the dots, and perhaps he will discover that trainees, apprentices, women who remain at home and low income-earners will not qualify under this bill.

HON. MR. RABBITT: There are, of course, minimum levels mentioned further on in the bill, Mr. Chairman. The member says that there is a variance between those who may work in the home and those who may be covered on a monetary level. But what we're doing here is defining an employee; we're not defining a wage rate. Those are two separate concepts and two separate ideas.

MR. ROSE: The minister says that we will be dealing with this later, and indeed we will. I think it's a real flaw in the bill.

What really does concern us is that people can work for very long periods without building up any kind of vesting or credits for up to maybe one-third of their working lives. That may be a bit of an extravagant statement, but I think it's certainly worth it.

Mr. Chairman, I was going to move out of this section, but I was going to deal with the employer rather than the employee. But if my hon. friend from Vancouver East wishes to ask questions on employees, this would perhaps be the appropriate time.

MR. CLARK: Mr. Chairman, I'm just curious, listening to the line of questioning, why every employee who is paying into a pension plan would not be covered by this legislation — like employment standards legislation or any other legislation. Why are there prescribed limits on who might be covered? If you're an employee of any shape, manner or form, and you're paying into a pension plan in British Columbia, why would you not be covered by this legislation? Given what we've heard, it appears that there are certain qualifications in order to be covered by the legislation, and I don't understand the rationale for that.

HON. MR. RABBITT: ...the rationale is rational or not, I will give it to you. When we looked across Canada, the standards were basically such as we've developed in this particular bill. What we are creating is a minimum standard, and we're keeping uniformity with the provinces across Canada, for the most part.

MR. CLARK: Maybe the minister, through his staff, could tell me whether there has been any quantitative analysis as to how many employees might not be covered by this legislation. Have they done any quantitative or qualitative analysis? Given that there are

[ Page 12962 ]

minimum standards before you're qualified to be covered by this legislation, how many people are likely to be working, paying into a pension plan and not covered by the legislation? I suspect it's very small. I don't doubt that, but I wonder whether there's been any qualitative analysis either in British Columbia or in the staff's review of other jurisdictions anywhere else in the country.

HON. MR. RABBITT: The member has hit right on one of the problems that we've encountered in creating this bill: the fact that there is not data available in some of these areas. A lot of the pension plans have been operated in a very cloaked manner, so a lot of information isn't available. After the bill is implemented, a lot of the information will be available through the public process, and decisions such as what we're talking about now will be made in an intelligent way. Right now, my focus is to bring in a bill which is going to be a starting point for British Columbia, which will keep as many pensions within the scheme as possible and not scare people away into RRSPs, or whatever. We're building a foundation here, and trying to build a uniform one that will be applicable across British Columbia.

One of the things that you must keep in mind is that in British Columbia we have a higher standard of living — meaning normally higher wages. I think some of the problems will have to be identified, and we'll have to look at ceilings such as were referred to earlier. We'll have to review many things, but right now what I'm looking at is getting a standard package that will be acceptable to all the participants in the pension field. That's employers and employees; those are the people counting on this.

MR. ROSE: Perhaps we could move on to the definition of "employer." I had intended to move a number of these things in terms of changing the definitions, but we didn't receive the wholehearted warm embrace of the minister's assistants and staff over these, on the grounds that I mentioned earlier — that it would mean revisiting the whole thing in cabinet. And the minister is quite interested in having this through in a reasonable time.

But, on the definition of "employer," we would like to add to what is there: "...any associated or related corporations, individuals, firms, syndicates or associations where anyone has control or direction of, or is directly or indirectly responsible for, the employment of a person, including a person who is an employer."

This comes from the Ontario Employment Standards Act, and the idea was to plug the loopholes against double-breasting. The other thing is to avoid the personal obligations by having company A's employees paid by a shell company as a result, and it plugs that loophole. I'm not sure it is plugged here. The explanation we received from the officials, if my recollection serves me well — and I didn't take it personally.... But I had it told to me that directors are personally liable under the Employment Standards Act. That outfit is chronically short-staffed, and I don't think it is as able to respond to these matters as if the thing were explicit in the legislation.

HON. MR. RABBITT: Yes, staff basically indicated the same thing to me, hon. member, so I'm glad they're telling us both the same thing. Directors and officers of a company are assessable for pension contributions. In the event that these pension contributions aren't made, then both directors and officers can be assessed personally for this, under our present legislation.

When you talk about being short-staffed, we're also talking about staff who are going to run the operation this bill will create. We're looking at ten, 12 or 15 people. We're not out there in a vacuum. There are going to be people monitoring and enforcing this pension legislation.

MR. ROSE: I certainly hope the minister's right. I was talking not just about the staff he might create as a result of this bill, but the idea was that under the Employment Standards Act, which is not the same as the Pension Benefits Standards Act, there is also a staff which is chronically short-staffed. They're supposed to be watchdogs in this matter, and I don't know if they have the capability or not.

Let me depart slightly on this. There is some pressure to pass this legislation; I think the minister feels it. The minister wants it, and certainly the officials want it. Everybody wants it. But we don't want a wimp bill. We want a bill that's going to do us some good.

Interjection.

MR. ROSE: Wimp, I said — a wimp bill.

MR. CLARK: No, Wim is over here.

MR. ROSE: No, that's his son.

Anyway, Mr. Chairman, I think it's important that if we have the bill at all it be as strong and rigorous as possible. The more things you can make explicit in a bill and not have dependent on some other piece of legislation — in general — the better it will be. I know the box the minister's in. He wants the bill, thinks it's a good bill. An election's coming up and all that good stuff. But we didn't delay the calling of the House, so I don't think we feel any obligation to submit to the kind of pressure that may be faced by the minister. If it's just a matter of getting your amendments past legislative counsel....

AN HON. MEMBER: We'll pass it in October.

MR. ROSE: My friend says we'll pass it in October. He's assuming he's going to call the House in October.

AN HON. MEMBER: We'll still be here.

MR. ROSE: Are we going to still be here? Doing this legislation, perhaps. But anyway, that's what I would like to say. Plug the loopholes. I'd be prepared to move the amendment. I don't think it will pass, so in that sense it's kind of a waste of time. But we've got some others here that are equally attractive — tantalizing even — and we'll move those.

[ Page 12963 ]

There's a matter here of the debt termination of membership. We had prepared an amendment on this one, too. This has to do with an addition to what's already in the bill that we would like to have added: people being covered who have spent time — this is for multi-employer plans for interrupted or part-time workers or workers caught in multi-employer plans. Termination of a member's membership is a very important matter to a lot of people who work for one employer for a while, then another and another. Perhaps it might be more common in the construction trades than anywhere else.

What we wanted to add was this business about "after what is there" — and I don't want to bore everybody who's got the bill before them by going through that. What about time spent injured and in receipt of workers' compensation? Wouldn't that be an example of time we should count for pension benefits? And what about time spent by a parent away from the job to raise children? The Minister of Social Services and Housing said today that people who do that are certainly fully employed and doing a great service to our country and province.

It modifies the definition by adding the marked section that I've just read to you — that injured workers and people on parental leave are not terminated by virtue of their injury or parenting. I'd like to hear the minister's reaction to that.

[7:00]

HON. MR. RABBITT: I found this amendment quite agreeable for the most part, and I must tell the member I agree in principle. I believe we can achieve this particular change by regulation, and the power is designated under section 66(l)(k). I will refer this item to the advisory council, and if I have their concurrence I will include it in the regulations.

MS. MARZARI: I'm looking at the definition of "spouse" in the bill. This definition is particularly bad as far as we're concerned, because once a married person lives separate and apart from her husband or his wife, the person can lose all his or her entitlement to a share of the pension benefits that are accumulated during the marriage, even if there is no other spouse involved. Consequently, a person who's there building a marriage, building a partnership, loses all entitlement if living apart or separated from husband or wife. We don't think this should be permitted unless the parties themselves consent under some separation agreement, or if they have a property settlement that comes out of family law.

The questions that come out of this are: what does the term "relevant time" mean, and why isn't it defined? It could mean anything. It could mean the time the worker becomes vested in the plan; it could mean the time the worker becomes entitled to payment of the pension or of the deferred pension; it could mean time to transfer the commuted value of the pension; or whatever the administrator or the superintendent says it means.

I'd be interested in knowing, because this definition of "spouse" is out of the nineteenth century, and it doesn't speak to what families look like in 1990 or the year 2000. Nor does this definition cover same-sex couples, which is a phenomenon that does exist in our community, and under any enlightened human-rights legislation it would be regarded as a legal entity. In fact, one would think that when partners are registered under pension or insurance schemes or whatever, it would not be a material issue as to whether or not that spouse or partner is of the opposite sex.

I would like the minister to speak to this definition of "spouse" and see if we can't make some amendment here.

HON. MR. RABBITT: I know that there's been a concern, and I was concerned as well. The definition was developed to keep it consistent with the present Family Relations Act. The Law Reform Commission is presently reviewing this entire family relations matter. I understand that the report is to be down by December. It is my feeling that we're much further ahead now to stick with the definitions that are in the other acts of government, and when the Family Relations Act and those other acts are changed, this one will change too.

With reference to the same-sex couples, I'm informed that that's a matter which actually goes beyond this bill as well. It's one which also deals with the Family Relations Act. But I'm informed that since this is a minimum standards bill, employers are free to extend benefits beyond this to same-sex couples.

MS. MARZARI: The minister has prepared a massive bill for this House. It's a bill which brings B.C. into line with the rest of the country. It is probably the most important piece of legislation this minister will ever bring to the House. It seems to me that the minister himself is concerned about the definitions expressed here and has asked the same questions we're asking right now.

Wouldn't it be a great thing, Mr. Minister, to bring in a bill that you can be proud of, a bill to which other legislation will have to accommodate, rather than accommodating your bill to other legislation that may or may not occur in the next six months or a year? Would it not, then, be your own bill, with your definitions, following your gut reactions, and the Family Relations Act could then follow suit? It doesn't make sense to say: "Yes, I understand that it's bad, but it's in keeping with a whole lot of other bad legislation." Wouldn't it be better to say: "Yes, we can change this definition of 'spouse'; we might well be the first people in the country to actually do it"? Why don't we do it now? We have an opportunity.

HON. MR. RABBITT: I should tell the hon. member that I'm very proud of this bill the way it is. It may have a few warts on it, but I'll tell you, it's a hell of a lot better than anything else that's out there.

The Law Reform Commission brought this forward in December. They're asking for submissions now. I think it is only responsible for us to proceed on a basis where we can use some common sense, use the benefit of all of the hours and the expertise that has gone into this study. This commission has done, from my perus-

[ Page 12964 ]

ing of this report, one heck of a good job. They're looking for more input. Here are people who have been focusing on this specific problem, who haven't come up with the answer yet, but they're going to work one out. I think it's only right for us to bide our time. When the proper definitions come down, at that time we'll bring them forward.

MR. ROSE: I still think that the definition of "spouse" is a bit archaic. I don't see why a spouse should lose all rights of family or extended benefits, survivor benefits, just because there is some sort of hiatus in the relationship for as little as two years. I think it's a bad principle. I think there could have been a lot more courage taken in definitions, rather than hiding behind, as my colleague says, some other act.

Section 1 approved.

On section 2.

MR. ROSE: Section 2 deals with the superintendent of pensions and the designation of his duties. I don't think he has enough duties. We think the compliance section is weak. So we would like to add the following subsections.... I intend to move this; I'm not certain what's going to happen to it after I do. I can move it after I make a few remarks, or I can move it now and turn it into the Chair — whatever would be most welcome. I don't think it really matters. It's not a matter of great consequence, in matters of order.

MR. CHAIRMAN: Technically, to discuss an amendment, it must be on the table.

MR. ROSE: The motion is to add the following subsection (3) for greater certainty and without limiting the generality of subsection (1): "The superintendent may: issue compliance orders on the superintendent's own authority" — because we think the compliance section is weak — "suspend or remove the administrator of a plan" — if he is not operating and behaving in the way he should be — "appoint an independent trustee and specify the actuarial reporting and assumptions"; or a person aggrieved by the exercise of the superintendent's power may appeal to the pensions benefits council established pursuant to section 3."

Further on in the bill there are some opportunities for the superintendent to go to the courts but not the employer or contributor. We'll be talking about that a little later on as well.

Anyway, that's the motion. I would be very pleased to give it to the minister, as I have given it to the Chair.

MR. CHAIRMAN: The amendment is in order.

On the amendment.

MR. ROSE: This amendment makes explicit what is implicit in subsection (1): "...the power to appoint an independent trustee is complementary to the power to suspend in section 3(6)." The principle is already in the bill. Also, see section 56: "...provides a check on the superintendent's powers."

The other thing is the business about specifying actuarial reporting and assumptions. Commuted value and actuarial value are not the same thing, and not all accountants or actuaries agree on how the concepts of commuted value and actuarial present value should be calculated. They're technical terms; they should be defined in the bill, and they're not. We think they should be, and that's why I've introduced that amendment. I don't think it takes anything away from the clause. It actually does two things: one, it puts a check on the superintendent's powers to maybe screw up, because it's not unknown in our society; people in very high positions do it almost every day. And two, it gives him other powers to suspend and remove administrators of the plan who are not behaving according to the best interests of the contributors.

HON. MR. RABBITT: It's interesting to note that the meeting you had with my very competent staff was successful in knocking half the changes out, and I guess we have to knock the other half out now.

Joking aside, on (a), according to my expertise here with us this evening, it is not needed. The present bill covers that particular area. On (b), the answer is no. "To suspend or remove the administrator of a plan" — we don't really wish to have the superintendent doing that in the early stages of this particular bill, and I'll tell you very frankly why. I feel that there is no way I want an unappealable firing of an independent administrator done by a civil servant. At this time I wish to be accountable or have the minister of the day be accountable in this House.

[7:15]

As for (c), the appointment of an independent trustee, I would again note that in this particular case we could have the superintendent actually appointed as the administrator for an interim period. I would not consider the superintendent to be an independent trustee, so I can't agree to that one.

I am told that we will be covering (d) in the regulations. With regard to (4), I am not prepared to accept the concept of a pension benefits council at this time.

MS. MARZARI: I think this is where we differ. This is not a civil servant hired through the normal procedure; this is a superintendent with a fiduciary responsibility for other people's money. This is a person like the superintendent of financial institutions who has real responsibility, and is sworn to that responsibility, to take care of money, whether it be financial institutions, pensions or trust accounts. This is not an ordinary civil servant. It's somebody who the government entrusts to keep this operation stable, consistent and reliable, without political interference.

This is the second time in this debate that we're talking about the minister becoming involved with decisions about private pension plans. I doubt very much whether employees, employers, trustees or administrators would like to think that the minister has an ultimate responsibility here and that he is going to be able to interfere if a plan is going under; or if a superintendent feels that something is wrong, that he does not have the power to get rid of or to laterally move an administrator and put someone in, perhaps from his own office, to make things right again or to

[ Page 12965 ]

bring it together. With reports to the minister, yes — but not with ministerial responsibility to interfere here with the job of an arm's-length superintendent. I think that in his refusal to take our amendments seriously in their spirit and in their specifics, the minister is showing exactly how far we are going to see political interference in the operation of this office.

[Mr. De Jong in the chair.]

A final point. The last item we are putting forward in our amendment talks about the superintendent being able to specify actuarial reporting and take a look at assumptions made in actuarial accounting. It's very important that the superintendent have this particular power for many reasons, because one of the ways that pension plans can diddle the pensioner is by making actuarial assumptions which benefit the employer rather than the employee.

Last night I talked to a woman who works for a university, as a matter of fact. She told me she found it strange that the women in her plan, who paid the same amount in, were going to receive a different amount out of the plan when they retired, because actuarially women had been calculated to live longer.

AN HON. MEMBER: They live longer because they have an easier life.

MS. MARZARI: They live longer because they have an easier life, said the minister for.... What is he the minister of now? I forget. It's Education. They change so fast.

It means that someone somewhere down the line has pulled out an actuarial table and made an assumption — lumping all women into one category — that they live longer, therefore the pension won't be paying them as much when they retire. A superintendent of pensions should be able to take a look at those tables and at the demographic grouping that is being measured. He should be able to look at, for example, professional women working in a particular setting and see what their life expectancy actually is. The superintendent should actually read his own act, for example, and find out that he's not allowed to discriminate on the basis of sex, when we're dealing with the provisions of this bill. It's very important, therefore, that the superintendent have the very specific power to be able to review the actuarial assumptions and the reports that come to him or her through the pension plans that are reported.

If we don't have that provision or a council that does that for us, we cannot be assured that our pension plans are appropriate and meet with basic human rights. We cannot be assured that they aren't sexist or perhaps even racist. We have to trust that superintendent to have the powers to protect the employee, who contributes to a plan over 30 or 40 years assuming that it's going to be fair at the other end.

Would the minister reconsider the political interference that seems to be inherent in his refusal to adopt our amendment and in the power of the superintendent to make recommendations and specify actuarial reporting techniques and assumptions?

HON. MR. RABBITT: Well, we have just gone through a whole spectrum of items that are covered further on in the act. But you know, I think the reference to political interference is totally unwarranted.

This ministry has the minister with a hands-on approach to many things. For example, in the Labour aspect of this ministry, the minister is responsible for many sections of the act. It's carried out in a responsible way. There isn't any political interference; it's done in a very clinical way. It's done on the merits of the situation at hand. What we've done is limit the powers of the superintendent. We've said: "If you want to fire an administrator, you make a recommendation to the minister. You don't have the power to do it."

We're talking about serious business; we're talking about paycheques through the pensions system that go to people — sometimes their only life savings. We want to make sure that what we're doing is correct at all times.

With regard to the actuarial valuation report, that's also included in section 9(4). As for the remarks with regard to the unisex rates, that's under section 24. I believe we can discuss them as we come to that particular section.

MR. CLARK: The minister made a defence of not having the power in the superintendent by saying that it's of significant import that the minister should make that decision. If the superintendent recommends that an administrator be dismissed, is that communication to the minister public?

HON. MR. RABBITT: I believe the answer is in the negative.

MR. CLARK: I have some concern. I understand the rationale of the minister. I'm not sure I agree with him, but I understand the rationale that you might want to make a political decision; even though this person may be incompetent and should be removed, the consequences are so important that the politician might say: "You can't do that right now." You may give him some time, or you may put in a trustee or something; I'm not sure what the options are.

It seems to me that it would be in the public interest, if the superintendent made a recommendation to remove an administrator of a pension plan, that that be public, so that the political decision by the minister, which I understand, is therefore held accountable. What we have in all these regulatory bodies, like the Principal Trust affair and things like that, where regulators make recommendations and there's a whole series of things.... If you're going to give the politician the discretion — and again I say I don't really have a problem with that — it means the politician has to be held accountable for the actions. The way to do that is for the superintendent to make public the superintendent's desire to have that administrator removed, and for the politician to have to exercise his political judgment not to do that and to be held accountable. I think there's a compelling argument for that to be made public, so that the politician can actually be held accountable for his actions.

[ Page 12966 ]

Failing that, I think if you made it public you could make the argument for political discretion, but if you're not going to make it public, then you should leave the discretion in the hands of the superintendent and have that as simply a routine matter; have that removed from the political sphere, and let the superintendent have that power. If you want to fetter that power with political discretion, then it's important that the politician be publicly held accountable. I've got some grave concerns if you're going to say the politician can overrule the superintendent but all of this is behind closed doors and no one knows whether there was a recommendation or whether the minister exercised his discretion. I think it's a real flaw, Mr. Chairman.

HON. MR. RABBITT: I understand why you could have a concern, but I think that what we're talking about is business decisions. There is a relationship of trust between any minister and deputy ministers or ADMs, and to request that every decision that's brought to the minister be made public is kind of a testy one.

After a decision is made, then fine, it becomes a public issue. I believe you're referring to when a decision is not made. I can see instances where it may be better for the group within the pension to have a particular issue worked out rather slowly rather than come in and do it with a heavy hand.

I can certainly tell you that if I am the minister of the day and this particular circumstance comes up, I will do my best to see that at the proper time it's made a public matter for all to view. But I would look at it first of all in the best interests of the pension fund and the ex-employees that are receiving benefits, to make sure that they are getting the maximum utilization out of the decision I would be making.

[7:30]

Amendment negatived on the following division:

YEAS — 12

NAYS — 27

Section 2 approved.

On section 3.

MR. ROSE: Mr. Chairman, this section deals with the advisory council. We might be some time on this section. I also have an amendment to delete the word "advisory" wherever it appears in this section. There's a copy for the table. I've got copies for the minister. There isn't very much to it, except to remove the word "advisory." I'd like to take a little time to discuss why we suggest it here.

On the amendment.

MR. ROSE: We've got all kinds of advisory councils in this province. I don't know who takes their advice, and that's the real problem that I have with the term "advisory council." It has a great number of parts to it, but they don't really seem to matter very much. It talks about their terms of office, how long they'll serve, that they can't be public servants, that each year they elect from among themselves a chairperson and a vice-chairperson.

We've got an environmental round table advisory council, with nothing binding on what they decide; the Science Council is the same thing; the Forest Resources Commission is the same thing, another advisory council. It's a kind of cosmetic window-dressing that passes for democracy. But if you give these people no power, then they're really not of much value. They're reasonably costly. You have to bring them into meetings. There may be some purpose in that in terms of getting expertise from outside. There are lots of talented people around here that are not in Crown corporations or as members of the Legislature — I acknowledge that. I don't have any trouble with that. But I think they should have a little bit more clout than that. I would prefer to see them almost acting like a board of a Crown corporation, where you have an arm's-length relationship.

In my view, that's what's wrong with the idea of the superintendent not having the powers of a CEO of a Crown corporation. There are perhaps good reasons administratively why he shouldn't have quite the same powers, but I'd like to see this sort of thing a little bit more arm's-length.

I don't know if the minister is aware of the veterans' pension administration in the federal government. They have a pension administrator; when I was there it was Mr. Solomon. In another building they've got an appellate division. In other words, they don't have the people in the civil service who made a decision in the first place reviewing their own decision; they've got somebody outside.

The same thing applies here. If you're going to have the minister so pivotal in all this — the minister who is really the superintendent's superior when the crunch comes — it seems to me that your advisory council is out of place here. They should be operating more like board members of a Crown corporation, where they can make legislative decisions, and the executive decisions following their legislative decisions are made by the superintendent. Now that's the sort of thing that my proposed amendment gets to.

[ Page 12967 ]

I think we should delete this. The commission, I think, should be tripartite; it should involve the employer, employees and people who know something about pensions, such as the actuarial community. Labour and management could sit as an administrative tribunal, if there was a matter of arbitrating what might be bitter disputes, and replace the arbitration route that is defined in section 62; report to the Legislature, hold open hearings and meetings, publish their proceedings, subpoena and compel production of information and papers and people to appear before them, and undertake research. This is, I think, a better way of protecting the public interest than what we have at the moment.

As I said the other night, to me the bill is backwards. The assumptions here are not really that these are deferred wages of employees — that pensions are that, and that the control really should be to protect those people, as the minister said a little while ago. There should be an arm's-length relationship with the minister and also with the employer. I don't think anybody should have a particularly close association with this, because of conflict of interest.

I'll describe a little later why I think that this.... I had proposed a motion to delete the advisory part of it, and when we dispose of that, a following motion will describe the purpose of the council. Again, I think autonomy is extremely important in these matters, and I think you do a lot more for autonomy by giving a council arm's-length authority — autonomy — which would not be held by an advisory council.

HON. MR. RABBITT: It would appear that we're talking about two separate philosophies here. Of course, one philosophy has been brought in by many jurisdictions, and the one that the member across the way speaks about was also brought in a short while ago.

Our concept of the council has been deliberately structured to be advisory. We've done that purposely. I should note that it's our view that adopting the commission model you're referring to would actually tend to create unnecessary, complex and overly bureaucratic procedures; that is what the experts have told me has occurred in Ontario. So we've opted to take another route. We've opted not to go the route you're speaking to this evening. We've opted to go the route of an advisory council. We're going to have the people you talked about on that council: plan members, pension recipients, labour unions, employers; and there are professionals who are knowledgeable about the pension schemes and plans.

I think we want the same goalposts, hon. member. We just think that our vision is the one we should focus on and the one we should go down the trail and see implemented.

Amendment negatived.

MR. ROSE: I suppose if we don't have an advisory council, it makes my next amendment almost redundant, because what I was going to do with the next amendment.... I'll hand it to the Chair; I also have a copy for the minister.

[7:45]

I'm going to leave this under this clause. We'll move on from this clause and, as far as I am concerned, we can pause again at section 7.

Sections 3 to 6 inclusive approved.

On section 7.

MR. ROSE: I don't intend to move a motion on this one, but this section governs the establishment of multi-employer plans, and the bill creates a further loophole. For instance, in Alberta — and I mentioned this earlier — the language has been used by companies to double-breast and re-establish unilateral pension funds that have lesser benefits. I don't know whether anybody here or out there really knows what this is, but a company is a union company and forms itself into another company which has lesser benefits, and probably not even its employees belong to the union. This is known as double-breasting. It's an escape hatch. It's a Peter Pocklington special, actually.

The idea here was that the equity representation on boards of trustees must not have fewer than the number representing employers. Now this is for multi-employer plans — or MEPs — and it has been questioned whether or not this clause actually does guarantee plan members 50 percent of the voting power on the board. I'd like to find out from the minister if it's the intention to ensure that plan members or labour representatives — in other words, contributors — on multi-employer plans have at least 50 percent of the voting power on the boards of trustees. Boards can comprise members, employers and also pensioners — people who are retired members. So I want to make certain that those who are actually contributors have a 50 percent membership.

As I've mentioned about 15 times, pension funds to me are deferred wages — indirectly or directly. As the minister mentioned earlier, in many cases pensions are really the largest asset that a member might have in a whole lifetime.

HON. MR. RABBITT: I believe that the first thing we should clarify is that the government has recognized that pensions are basically deferred wages. They've done so through the employment standards, and it's been there for years.

With reference to the makeup of a multi-employer plan, it should be pointed out that this section states that all the members can be on that board, but the minimum is at least 50 percent. So there has to be at least 50 percent representation there; but it could be 100 percent.

MR. ROSE: Let's just read this clause: "If a multi-employer plan is established, or maintained by contributions required, under a collective agreement within the meaning of the Industrial Relations Act, the number of members of the board of trustees representing

[ Page 12968 ]

members of the plan must not be fewer than the number representing employers."

That does not mean 50 percent, I'm sorry to say, because you have other people who could be on the board — potential members of the board — and those are pensioners. It's not that we want to cause any difficulty; we want to encourage multi-employer plans. I think that's the way to go, rather than having a lot of little pots called pension plans. I would much prefer to see a much larger unit. As a matter of fact, I wouldn't even object to one large pension plan for all Canadians. I have no objection to that. We have it in part now, through the Canada Pension Plan, but all that really is.... It's not and was never considered, to begin with.... There were a lot of arguments about that when it came in. If you read the history of the arguments and how the insurance and trust companies fought the Canada Pension Plan, it's very revealing.

Interjection.

MR. ROSE: Upon what are you sitting, should be the more appropriate question.

Interjection.

MR. ROSE: The current Minister of Finance. There he is over there in all his pristine glory.

Interjection.

MR. ROSE: Militant? He's sitting there full of conceit and arrogance. But in any event, I've completed my compliments to the Minister of Finance.

What I wanted to tell you is that if you look at a simple book like the one in our library that Ann Finlayson wrote called Whose Money Is It, Anyway?, you'll find out what a big struggle it was to have a Canada Pension Plan to begin with — which is considered a supplementary plan after everything else has been done. There were tremendous fights over that plan.

I will sit down if the minister would care to hold up that exhibit.

AN HON. MEMBER: They're not allowed in here.

MR. ROSE: By unanimous consent you can do anything.

The number of members on the board of trustees representing members of the plan must not be fewer than the number representing the employers. You've got pensioners; you've got current contributors; and you've got employers. It doesn't guarantee 50 percent of workers at all.

HON. MR. RABBITT: This is interesting, because I'm not a lawyer either, hon. member. But the experts do tell us, my friend, that "there must not be fewer" means equal to or more. It should be pointed out that the definition of "member" includes former member. In that particular half of the equation, we can have a member or a former member. It has to be equal to or more than that on the other side of the equation.

MR. ROSE: The pension plan developed in Canada has not been a complete, outstanding success, because there are far too many people. I mentioned the figures last night — some 600,000 are covered in British Columbian pension plans and over a million not covered. We haven't got very comprehensive pension coverage. Some arguments have been put forward by the minister and others that if we make this thing too rigorous, there will be even fewer.

I'm not sure I care to follow that too far, because it would be quite possible to legislate a pension plan as we've legislated medicare. I'm talking about a contributor. I'm not talking about wringing out those poor employers who are paying so many taxes. I don't think that's a possibility. But I think the cooperative employer-employee relationships that have built some very successful pension plans in this country have and must be encouraged. We don't want to do anything that would cause this cooperation to cease. We should make sure we have at least 50 percent employee relations. I'll leave it at that, and if it's in your interest, we'll go onto section 8.

Section 7 approved.

On section 8.

MR. ROSE: I have an amendment here for section 8. It's really an amendment to section 8(5). It adds to the power of an administrator of a pension plan and regulates his behaviour. If you would take a copy of that and send one over to the other side, I'd be grateful — if I can find them all.

On the amendment.

MR. ROSE: This amendment — for those people who don't have the bill before them — has to do with the general responsibilities of administrators. It says that the administrator is responsible for the administration. "In accordance with the act, the administrator shall ensure that the plan, including its contractual provisions, complies with this act and the regulations. If the plan has been terminated, the administrator shall ensure that it is wound up in accordance with the act and the regulations."

That's very important, because if a plan has been terminated through whatever means — the company goes out of business or into bankruptcy — we want to know who has the major call on unpaid wages and unpaid benefits. A number of these plans are only partially funded. It can be a real disaster for some of the contributors, if the company.... Did I give you the wrong one? It's the amendment to section 8. We will send it over as soon as we can.

What we're doing here is adding to the functions of the administrator, all of the administrator's agents and others providing service to the plan or fund. So we delete subsection (5) under the exercising of powers and functions: "...(a) shall act honestly, in good faith

[ Page 12969 ]

and in the best interests of the members and former members and any other person to whom a fiduciary duty is owed...." That may be implicit, but it is not always implicit. The administrator "(b) shall exercise the ordinary prudence a person would exercise in dealing with property of another" — because these are, after all, the contributions and funds of the contributors who are working people and members of the plan — "(c) shall not act in conflict of interest unless authorized by the superintendent pursuant to subsection (6)."

Subsection (6) may allow certain activities that would actually be affirmative action types of activities.

"The superintendent may allow an application for actions that are in conflict of interest, where the proposal is administratively feasible and in the interests of the plan and its beneficiaries and protective of their rights.

" (7) The use of socially responsible criteria for investment shall not be deemed to be an abrogation of the fiduciary obligations where a reasonable rate of return has been obtained in the three years preceding the investment."

That's a real big mouthful of jargon. I don't think half the people out there in videoland even understand it. Sometimes I don't think I understand it myself, but I will do my best. What subsection (7) says, essentially, is really in line with Vancouver City Savings and other credit unions, groups and mutuals that do the same thing.

Subsection (7) says that the administrator of the plan has the power to make choices about investments — not just the biggest bang for the biggest buck; it may be the same thing — even though the returns might be somewhat larger in such investments as nuclear power stations, Union Carbide's chemicals, pollution-laden industries of various kinds, Litton Industries dealing in arms, and industries like that. It gives them the power to make decisions that may be in conflict of interest with the biggest buck, but it still entitles them to make these decisions.

[8:00]

Ethically and socially responsible investments are probably superior, like a company that treats its employees extremely well, and there are a number of them. If you were to make an investment in that sort of firm, rather than in one that is some kind of a gouger and a bad employer, then that would be possible under subsection (7). It sounds good to me, and I would hope the minister would consider this as part of a positive suggestion. I have moved it, and I would like to hear his response.

HON. MR. RABBITT: The wording in this bill is similar to a provision in the Financial Institutions Act, and that was section 100 of Bill 51 of 1989. Of course, as the member knows, a trustee must act for the benefit of the plan members and beneficiaries, and this is a fiduciary capacity.

The board of trustees and other administrators are bound by the Trustee Act, and the law of trusts, as well as the fiduciary duties, is imposed under section 8. We believe that these provisions are sufficient protection, without adding detailed and onerous reporting and conflict-of-interest requirements that may not add perceptively to the benefit security in the other jurisdictions.

When we look at how Osborn's Concise Law Dictionary defines a trustee — and I'm sure our learned friends at the table here could tell us — it says: "A trustee must use as much diligence as a prudent business person would use for their own affairs." So that's why we've developed this language.

Subsection (7), which the member referred to.... It is felt by my staff that it's not needed, because where a reasonable rate of return has been obtained, no statutory protection is required. I hope those comments address the points raised by the member.

MS. MARZARI: Our amendments (6) and (7) basically speak to things where exemptions should be made under the bill, so the administrator does have more complete power to do things that may be in the interests of the plan holders.

When we talk to subsection (7), as my colleagues suggested, there are mutual ethical funds that the Vancouver City Savings Credit Union has initiated, for example, which may not necessarily meet the standards that might be set down in legislation but which plan holders might be interested in vesting in. It is our subsection (7) then that allows the plan holders and the administrators to be able to canvass those kinds of plans.

Our subsection (6) speaks to possible conflicts of interest, and we recognize that there could be conflicts of interest in which it is in the best interest of plan members to possibly allow. For example, the board of trustees of a multi-employer plan may consist of persons appointed by unions and employers, or in some cases unions only. The trustees may deem it prudent and necessary to enter into a cost-sharing agreement with a union for administrative services provided to the MEP, such as the collection of delinquent contributions.

There may be instances where a plan may want to engage in activities which would benefit the plan holders but might be perceived, under the normal course of events, to be a conflict. We put forward (6) and (7) to get around that, to provide the potential exemption, so that the administrator may be able to do that in the interests of the plan holders.

The other suggestions in our amendment basically try to strengthen the case and strengthen the responsibilities of the administrators and provide a slightly higher standard than the common law allows.

HON. MR. RABBITT: This is an interesting scenario, because what we're talking about is non-arm's-length deals and the fiduciary capacity of the superintendent. When we look at what is specifically being said here, what we're talking about is allowing actions which would allow a conflict of interest only for specific things. I really have difficulty accepting that concept.

I think that we have to focus on what is the best for that particular pension plan. If we were talking about the investment of surplus funds, then fine, this is allowed within the act. But in subsection (7) you refer

[ Page 12970 ]

to socially responsible criteria. I think that opens the barn door, folks, to what could be used in many political ways, which may not be to the betterment of the plan. I would have great difficulty accepting those changes.

MR. ROSE: I understand the minister's problem. What he is saying is that it's permissive now. He also talks about ordinary prudence, from some legal dictionary. We've got that in our amendment; we accept that.

All we're saying here is that this is encouraging; it's not merely permissive. Subsection (7): "...where a reasonable rate of return has been obtained in the three years preceding the investment." I don't think it's being radical to suggest that maybe in some ways in the economic or fiduciary area somebody is going to benefit better by investing in cannons or germ warfare or anything else that might sell, but I don't think in the long run that's really going to help that person if the cannons are suddenly turned on him. We're saying that the economic bottom line, a percentage, should not be the be-all and end-all of this sort of thing. That's why we've said in the last line of this: "...a reasonable rate of return...in the three years preceding the investment." In other words, what we're talking about is what the minister's talking about — if there are some funds there that do this and the plan is in good shape. Some of these plans are not even funded up to 20 percent of their liabilities. Let's not forget that one, either. There are a lot of plans that are like some of the American banks in the 1930s: they're not in very good shape, and if there was a sudden run on them or something happened, there would be lots of problems with them. I could name one, but I don't intend to.

MR. CLARK: I want to speak in favour of the amendment as well, because it's a very interesting question. It's possibly allowed under the current legislation proposed by the minister, but this makes it more explicit. This is a very complex area. Let's take a couple of examples.

There is a fairly recent example. The Minister of Forests is here and might be interested. To invest in silviculture has a very low rate of return. So should the forest industry pension fund invest in silviculture, even though the rate of return is lower than it might be in alternative uses? On the other hand, if they invest in silviculture and they grow more trees, there will be more forest workers down the road to contribute to the pension plan. In fact, if silviculture is not invested in, then there won't be any people down the road to invest to keep the pension plan whole. This was a debate that actually took place, and ultimately the pension fund chose not to invest in silviculture. But it was a very interesting debate. What we're saying on this side is that this is a legitimate debate. Pension funds should be able to make those legitimate choices, even though in straight business criteria it's not as clear, because of those essential conflicts.

[Mr. Ree in the chair.]

Likewise, the building trades unions use their pension funds exclusively for union construction. The reason they do that is quite obvious: they want to support their members who are working and paying into the pension fund. It may be argued that the rate of return might be lower. It isn't, of course, in this case, but you could argue that it might be lower. But the pension fund benefits in other ways, by keeping people working and therefore paying into the pension fund.

There's a clear conflict of interest there in a technical sense. What we're saying on this side is that we want to make sure that in the legislation — while accepting the fiduciary responsibility — very clearly there has to be a rate of return that the pension fund has to behold.... But we want to encourage that kind of debate, because we think there are lots of social benefits and other arguments that make good sense for certain pension funds but are not, in the narrow sense perhaps, the most optimum rate of return that the pension fund could have. As the minister knows, many of the plans in British Columbia actually operate voluntarily under the federal legislation, because they do business outside British Columbia and in fact.... I see some people shaking their head, but there are several plans registered in other provinces and therefore for a variety of reasons fulfil the federal Pension Benefits Standards Act and come up to those standards. We just want to make sure that this bill does not prohibit that kind of interesting debate, subject to the pension plan being run in a sound businesslike manner. It's a good amendment, Mr. Chairman, and I think it would be worthwhile for the minister to consider it.

HON. MR. RABBITT: I certainly don't want to spend any more time on this than necessary, but the example the member brought up was rather interesting because he was talking about forest workers' pensions being used for investment in the forest industry. On the front end that sounds like a very admirable idea. I would ask you to consider one thing. Right now we all know — it's been recognized by both industry and by the IWA trade union — that their pension fund is only funded at 60 percent. Now should we be allowing political decisions to be made on investments for an underfunded fund such as you're talking about? We have an industry that is becoming more automated. The workforce is aging and in many instances is shrinking because of automation and improvements in the industry. So we're creating more pressures. We've got this underfunded pension at 60 percent, so I really challenge the idea whether we should be making political decisions that the Ministry of Forests and the cabinet should be making on something like that, rather than asking the pension fund to take the pension cheques of those individuals receiving them now — and they are getting full benefit.... But in a short time, if the funding isn't caught up, they could actually end up with reduced benefits.

So there are some balances that have to be done. If we're looking at social programs such as this, we should definitely be very careful when we're allowing the latitude for those types of decisions to be made, so

[ Page 12971 ]

that we don't jeopardize those pension funds for people down the road.

MR. ROSE: Without going into too much more debate on this, I think we covered that by saying "...where a reasonable rate of return has been obtained in the three years preceding the investment." I don't think anybody's going to be squandering it or throwing it out the window.

As a matter of fact, there are all kinds of horror stories attached to pension funds. I can think of a liquor company that used to operate out of New Westminster. For argument's sake, let's just call the company Old Rotgut. Old Rotgut used to take the pension funds of its contributors and invest them at about 3 or 4 percent in Old Rotgut. It had access to really cheap borrowed money for that. That's the kind of pillage of a pension plan that was not uncommon at all. We're not talking here about the difference between investing in silviculture or Litton Industries or some other perilous outfit like some nuke plant someplace.

[8:15]

Another example is that for years and years the teachers' pension fund of British Columbia was used to buy British Columbia bonds at a very low rate, because control of the pension fund was under the Premier or the cabinet. We could search for a whole bunch of other examples where pension plans have actually been plundered. We're not suggesting you open the door to all kinds of raids of this sort. All we're suggesting is that rather than the short-term view being encouraged on the bottom line, or the highest particular percentage in terms of investment, perhaps a more long-term view of socially beneficial investments might be permitted and even encouraged.

MR. CHAIRMAN: Shall the amendment to section 8 pass? I say the noes have it.

MR. ROSE: Mr. Chairman, I think the noes are blessed on that side by having the loudest voice in the whole building.

MR. CHAIRMAN: The Chair appreciates the observation of the hon. House Leader, but the Chair basically hears stronger on the right than on the left.

MR. ROSE: Would you mind turning around?

Amendment negatived.

Sections 8 and 9 approved.

On section 10.

MR. ROSE: I have an amendment to section (4), which says that the administrator shall, "after receipt of a written request and without charge, permit any person entitled to a benefit, or the spouse or any designated beneficiary..." within 30 days after the receipt of the written request, to have that information. My amendment suggests we delete "30 days" and substitute in its place "10 working days."

I'm told that this is the kind of radical amendment that the minister might even try to accept. The contributor is certainly entitled to the information a lot sooner than that.

MR. CHAIRMAN: This amendment refers to subsection (4) of section 10.

MR. ROSE: Yes, sorry; I didn't make that clear.

The basic plan information will now be available, I'm told. But why 30 days for the information about this to come out to a person who makes a request? I don't think 30 days is necessary, especially since under section 22 there is a provision for the library in which all the plans will be registered and available in the superintendent's office. I think that's a good provision. That's an excellent one. I see no reason to belabour this one. I see no reason that ten days shouldn't be as acceptable as 30. I guess I've made what case I can for it without prolonging the agony.

HON. MR. RABBITT: The government certainly sees the wisdom in the number produced by the opposition critic and certainly agrees to lowering the number from 30 days to ten working days.

Interjection.

HON. MR. RABBITT: I have to let you retire, hon. member, with fond memories of me.

I'm going to be asking the advisory council to look at all of the dates and time-frames in the act. I mentioned earlier that as the legislation starts to work and the information starts to come in, we're going to find out just how workable some of these time-lines are. I would like to thank the member for bringing this to our attention and ask my colleagues to vote for the amendment.

Amendment approved.

Section 10 as amended approved.

Sections 11 to 14 inclusive approved.

On section 15.

MR. ROSE: I'm going to talk about 15, 16 and 17. We'll do the whole thing as a little package.

I've just got a few general remarks to make. These are three sections together. They provide administrators with freedom until they get reined in by the superintendent. The law is supposed to provide clarity, equity and predictability. The proposed law may be clear, but it's lacking in equity and predictability in its effect. The risks are very great to all the plan members. They're required to trust that the administrators will not make mistakes and that the superintendent will at all times be alert and fully staffed. Adopting the small changes we suggest would provide for wider dissemination of information and the greater possibility of concerns being promptly addressed by having concerned members blowing the whistle. We should have

[ Page 12972 ]

an opportunity for not just the superintendent to blow the whistle, but concerned members of the plan to blow the whistle. In effect that's what we're talking about. If they or their trade union representatives do not receive notice of changes caused and prompted by some decision of the administrator.... The watchdog is too far removed.

Sections 15 to 21 inclusive approved.

On section 22.

MR. ROSE: Moving right along, this is flowing like molasses. I'd like to suggest that section 22 is a really great idea, but I have a couple of questions to ask about section 22(3). I'd like to know how this will work. Could he give any examples of a document having adverse effects?

HON. MR. RABBITT: One example would be a financial statement for a private corporation.

MR. ROSE: I take it that these documents will be on file in the library. What you're doing is calling for a library of all plans to be established in the superintendent's office. I didn't know that they were going to be accompanied by financial statements; that is not made clear here. Subsection (1) does not apply to a document that contains information about pension entitlement to a specific individual unless that individual gives written permission. I don't mind that; that's the right of privacy. But is "...information in a document could have an adverse effect..." what we're talking about? And what is the objective test?

The only information to be released is about the pension fund and not the employer. I think that's an objectionable ground. Why should the pension funds be the subject of public scrutiny and not the employer's side of it? The superintendent is not required to meet the objective test. There's no appeal against the superintendent's decision if he slams the door and says: "No, you can't see this." There's no requirement for the plan beneficiaries to be notified when the superintendent makes a decision that is contrary to the rules of natural justice. So it doesn't seem to be ventilated particularly well, and I don't think it gives the public access or the right to know due respect.

HON. MR. RABBITT: The member is correct. The plans will be on file; they are available. But the backup information will be treated case by case, and we're going to depend upon the common sense of the superintendent.

MR. ROSE: If the superintendent, Mr. Chairman, happens to be a little short on common sense, what is the appeal procedure available to a client who has been denied certain kinds of information?

HON. MR. RABBITT: I think the ultimate answer would be that if the superintendent does not use good judgment and common sense, he would be replaced.

MR. ROSE: Would he be replaced by the minister's common sense, which, again, might be a rare commodity — not with his minister but with some ministers. I'm not fond of this side of it. Aside from the fact that I like the idea of everything being on file there, I would prefer it to go through on division. There is a certain aspect of it that I find — "reprehensible" is too strong.... But I certainly find that the right to know, the right of privacy, the openness of it leaves a lot to be desired.

You know, the whole thing about this whole pension stuff for everybody is extremely complicated, and the poor schmuck who's the contributor very seldom has an opportunity to know what he should know about these things. People now, because of Ann Finlayson's book, are only beginning to know what goes on. Billions of dollars are in these plans. Billions of dollars of investment funds are in the hands of insurance companies and trust companies and some unions as well, but the contributors have very, very little to say about this, and they know probably even less. Anything that improves the employee's right to know should be enhanced and encouraged, and I don't like this side of this particular clause.

MR. VANDER ZALM: It seems to me that in section 22(3) the superintendent must have evidence that in fact there will be an adverse effect on the employer in order for the superintendent to allow the withholding of the information. So if anyone doubts or questions the fact that there's an adverse effect, I suggest, or would expect, that there's still the recourse of a legal proceeding. I would ask the minister if that's so.

HON. MR. RABBITT: I believe it would be, but I can't specifically cite a section that offers the right of recourse to the courts. I would have to get back to the member on that.

MR. ROSE: Well, in just about everything else you have reference to the courts, but for some people that's a pretty expensive and pretty — I'm looking for a synonym for slow — lethargic, costly and difficult procedure.

AN HON. MEMBER: For everyone.

MR. ROSE: For everyone concerned. I think there should be a simpler way.

You see, right here the superintendent is God. He makes the decision whether or not this is going to have adverse effects on the company's competitive position.

Interjection.

MR. ROSE: No, in almost everything. Even if you're convicted of murder you have the right of appeal. I think this gives a flat decision by the superintendent, without any explanation of a person's right to appeal, other than through the courts.

[8:30]

[ Page 12973 ]

Well, I'm standing here. I was hoping that the minister would be prepared to get up and discuss this a bit. Besides, I wanted more television time.

[Mr. Pelton in the chair.]

HON. MR. RABBITT: My understanding is that the general act a question such as this would come under is the Judicial Review Procedure Act. I'm not that familiar with that act, but I know that it is applicable when you're challenging a decision of a government to act in such a manner.

It would probably be better if a question like this were directed to the Attorney-General; but it's my act. I should know which section of the Judicial Review Procedure Act you would have to access in order to make that challenge, but that's the act.

MR. ROSE: I've no desire to prolong this agony, but I wonder if the minister could tell me if there's any requirement for the beneficiaries or survivors of the beneficiaries to be notified when a superintendent makes a decision. This is contrary to the rules of natural justice. Who's informed? Who could appeal? Who's going to court? How do we know that this matter has been refused?

HON. MR. RABBITT: I believe the approach is one of natural justice and common law.

Sections 22 to 24 inclusive approved.

On section 25.

MS. MARZARI: Section 25 is the piece of this act which is the most alienating for the women of this province. I referred briefly before to actuarial tables, which can have a tendency to exclude women and to penalize them as pension contributors and recipients. Section 25 is an exclusionary section which basically draws a line at 35 percent of the year's maximum pensionable earnings. There's no number mentioned in the bill, but the numbers I have before me tell me that for 1991 the year's maximum pensionable earnings are $10,675. The line is drawn at that point. People earning less than that are basically not entitled to join the pension plan.

In the long term, if preventable poverty in old age is to be eliminated, we should be talking about obligatory participation in pension plans. People on minimum wage, even if they work full-time, can't make this amount. They'll make $500 short of that amount. So the working poor — seasonal, marginal, intermittent members of the workforce, and if they are women, very often full-time members of the workforce but earning minimum wage — are the people who most need to be supported in their old age. They are probably the most willing to contribute if they were allowed to, yet they will be excluded.

There's no doubt that this will hit women the hardest. They're paid 66 percent of a man's wage for work of equivalent value. We know that figure; we've talked about it in the House. There's a pay equity program designed to try to fill that gap. It's women's wages that drop when anything happens in their lives. When a spouse leaves, a woman's earnings drop an average of 60 percent. Women's wages drop when they're on maternity leave. Women's wages drop when they're the last in to jobs and often the first out when the layoff notices come. Women are the most vulnerable. What makes this extra ironic, if I may put it that way, is that this makes women in their old age most susceptible to needing government assistance. When the government comes in with section 25 and says that women and the vulnerable are basically excluded from a pension plan, what you're buying yourself is a poverty package, subsidized and underwritten by government.

Through old age security, guaranteed income supplements, Mincome, GAIN or whatever, the government is basically saying that it will continue to underwrite the costs of welfare payments to people who would rather not be on welfare and who would rather have contributed to a pension plan where the money was theirs from the outset and they have an absolute right to that money.

What we are doing by not including women now in private and public pension schemes is ensuring that government will be forking over literally millions of dollars later on in the scheme. We're basically writing a welfare package right here and now for hundreds, thousands, of women. I would suggest that if we want to avoid buying into a poverty package, section 25 should be revamped and reviewed so as not to exclude women and the working poor — those very people who are perhaps the most highly motivated, who want old age security more than any of us, because they know what it is to be poor in their youth.

HON. MR. RABBITT: I understand the member's concern, but I should point out that this is a bill which sets standards. It's not a mandatory pension plan. My colleague who sits to the right of me here, the Minister of Women's Programs and Government Services, has been for several months developing just such a program. But that's other legislation. What we're talking about is setting minimum standards. In setting this standard, what we've done is establish one based on uniformity across Canada. Right now there are three provinces which agree with the concept that you're speaking to, in general terms, and the balance of the provinces have legislation which is similar to ours and on which we've based ours.

MR. ROSE: I seek to move an amendment, and I'll speak to it afterwards. What this amendment says is that by deleting subsection (1) — and that has to do with the 35 percent in each of two consecutive calendar years — we're really substituting the Ontario legislation, which says this:

"Subject to subsection (2), every employee, within a prescribed class of employees for whom the pension plan is maintained, is, on application, eligible to become a member of a pension plan after completing two years of continuous employment with the employer, which period may begin before January 1, 1993, with earnings of 35 percent of the year's maximum

[ Page 12974 ]

pensionable earnings" — that's $10,675 — "or 700 hours of employment in a two-year period, whichever is less."

On the amendment.

MR. ROSE: What this attempts to do is get over that business of a woman or a man who might earn that much on minimum wage with two employers. If this happens with one employer, and if you happen to get the minimum $10,675, you're entitled to participate as a contributor, and you're covered as a pensioner when it comes time — after the suitable time and retirement investing and all those other pension jargon-laden phrases.

What this does is provide an alternative, because many of the people — as was pointed out by my colleague — do not earn $10,000 a year. Yet because they have — I was going to say "enjoy" — such low wages, they don't get this income of up to $10,675. They're part-time workers. All kinds of department stores hire part-time workers; some just on weekends — a couple of days a week. We'd like to see them have an opportunity as well to build up a pension credit, if you like.

I will give the minister credit about this. This is the first time that part-time workers have been covered, to my knowledge, and we're encouraged by this. So, you know, we're not trying to damn the minister with faint praise on this, or vice versa. What we are saying is let's not give with one hand and take away with the other. The very people who need it the most — who are more likely to be poverty-stricken in their old age — do not qualify under this, because they can't make the minimum standards. Just make the standards a little bit more flexible. I have no objection to the fact that they got contributions for every hour they worked or would have some credit for it, because half a loaf in this sort of thing is a lot better than none.

I think everybody knows that many people in this country, including MPs and MLAs, are well protected in their pensions. Those people who are more likely to be the recipients of GAIN and the GIS are those who cannot during their lifetime, for one reason or another, ever qualify, because they don't earn enough.

My motion offers an alternative patterned on the Ontario.... I think this has been in for a couple of years, because they had a royal commission on pensions down in Ontario. Ms. Finlayson talks about this in her book. It gives an alternative of 35 percent of a year's maximum pensionable earnings — it could be 25 as far as I'm concerned — or 700 hours of employment in the two-year period. It doesn't really tie it to income. That takes care of the people who earn less. Of course, their pensions would be less because their contributions would be lower. But at least it's a far cry....

Most people, I think, would like to pay into contributory pensions. I think there should be a provision — I mentioned it earlier — beyond the CPP which is supplementary, that everybody works, and also that homemakers be able to pay this. Then we could avoid the massive costs of some of these comprehensive systems such as GIS, because it's a means test or an income test. I think that would be a step in the right direction.

I don't think that we're overloaded with safety nets in this country. One of the reasons we don't have as many European immigrants as we once had and that people are coming from other cultures.... I have no objection to that; they enrich us. We don't have as many European immigrants because there a full-time job is virtually guaranteed, even in agriculture, at 75 percent of the industrial wage, and almost full employment is enjoyed. That's not in Germany now since we took down the Iron Curtain and there's the reunification, or in some of the eastern European countries. But the countries of western Europe have virtually full-time employment and far greater and more extensive safety nets than we have in this country. They're doing very well economically. The only people that are in trouble are the Reaganomics people such as Canada, the United States and Britain. They're the people who aren't doing very well.

I would therefore recommend to the minister that he consider this very carefully. I don't think it's going to add a lot to the cost or burden. I don't think it necessarily has to be done simply by regulation. I don't think it's possible to do it by regulation. Why not accept this? It's a reasonable move and will make the Minister of Women's Programs very happy.

HON. MR. RABBITT: There's been a lot of consultation in developing this bill, and there was a lot of consultation to Bill 44, Bill 89 and right into Bill 6. I would say that with the amount of change that we're talking about here, it would be premature for me to suggest a change at this time without having further consultation with the community. I would suggest that it would be more appropriate for me to ask the advisory council to review this and make a recommendation to the minister.

With that I'll close my remarks on this section and recommend to my colleagues that they vote against the amendment.

[8:45]

HON. MRS. GRAN: I wanted to say a few words about the amendment and some of the things that the opposition House Leader and the first member for Vancouver–Point Grey have said. I think there truly is some confusion between the pension standards bill that we're talking about here and the B.C. retirement savings plan that was introduced earlier in the spring.

One of the things that you need to be really careful with on this amendment is hurting people already on pension plans. It's my understanding that many pension plans in Ontario have collapsed over the last two or three years, and I'm not just talking about during the term of the NDP government.

Interjection.

HON. MRS. GRAN: Yes, that's right, it is before that.

If we go too far, you will find employers not wanting to provide that kind of benefit any more. It

[ Page 12975 ]

makes a lot more sense to bring those people on lower incomes — and particularly women, homemakers — into the retirement savings plan that will be coming in this fall.

I also wanted to talk a little bit about the response to that particular bill, because it fits with what's happening here tonight. We have had 1,200 hand-written letters so far on that bill; only 25 responses are opposed to what we are doing. It tells me that there is a tremendous amount of interest and need. The opposition members are correct; it's high time in British Columbia that we had this kind of legislation. But if you put the two pieces of legislation together — this one and the B.C. retirement savings plan — you're going to end up covering those people you're concerned about and whom certainly I'm concerned about.

So I want to congratulate my colleague for bringing this bill in, I also want to say to the opposition House Leader that I appreciate his concerns. I can remember when he and I sat on the Board of Internal Economy — if I dare mention it — talking about pensions and discussing how important it was for us as politicians to bring pension standards into this House for British Columbians so they have the same opportunities that many other people do, particularly those who work for government.

MR. ROSE: I'm pleased that the hon. minister has entered the debate. I don't think anybody should be fooled that this is a fact. We've got a pamphlet and we've got promises. We had an introduction — a show-and-tell bill — but I think a lot of people are misled; they think this thing is ongoing. I'm not certain that the minister might even be around here in order to do this in the fall. But that's no reason to advertise it now as if it's a fact. There is a truth-in-advertising law federally here, and we should make sure about that.

Interjection.

MR. ROSE: I'm sorry, Mr. Chairman, but the minister didn't complain when his colleague was talking about her bill.

The speech of the Minister of Women's Programs was a little bit like the speech given against raising the minimum wage: if you raise the minimum wage, employers won't be able to hire people because it will eliminate a lot of jobs for young people.

I don't think there's anything inconsistent with my $700 floor and bringing in this plan. If there is, I just don't understand it. This has got a $500 subsidy for certain people. It doesn't even talk about people who are working. But if it's a comprehensive plan available to people, and if the women who need it most can afford it, we're all for it. It would sail through here, no problem at all.

Amendment negatived.

MR. ROSE: The amendment has gone, in spite of the fact that I really congratulate you on your new hearing aid, Mr. Chairman. The amendment is gone, but section 25 is still with us.

This sounds to me like a distinction without a difference, but we had thought of putting forward an amendment in subsection (4) by deleting the word "comparable" and substituting the words "reasonably equivalent." Would you mind telling me what the difference is between "comparable" and "reasonably equivalent"? It has to do with the treatment of part-time workers in their plan, and our advice legally is that "comparable" is a weaker term than "equitable" or "reasonably equivalent."

HON. MR. RABBITT: Well, I thought that when an amendment came in the opposition critic was supposed to give us the arguments on why this wording would be more substantial. My advice is that there is no distinct, clear difference, and without having a reason to make a reasoned amendment, I can't find any justification in doing so.

MR. ROSE: As a matter of fact, "reasoned amendment" has a special definition in our rules here. I don't think you would want a reasoned amendment, because that would give this thing a hoist for two or three days. I'm not sure that's really what you want.

I guess I'm saying that we believe that "equivalency" is a stronger term than "comparability." That's why we want to substitute "reasonably equivalent." But we've decided not to proceed with that, because we didn't think it was a matter of great ponderability.

Sections 25 to 30 inclusive approved.

On section 31.

MS. MARZARI: Section 31 provides for interest gains and losses to be applied to member contributions. The problem here is that these terms are not really defined by the bill. If you look up the definition of "interest" in the definitions section, you are referred back to section 31. This kind of circular law doesn't go down very well. We want to know what definitions are being used here. Interest, gains and losses should be clarified. Is it the interest earned by the planned investments, as well as their capital gains and losses — what the industry seems to call experience gains? Or does the government mean that all gains and losses apply, including actuarial gains and losses? I'm not quite sure what an actuarial gain or loss is, but I have been told that actuarial gains and losses are calculated at infrequent intervals and serve different purposes than those which require the calculation of an experience gain.

The other thing we're concerned about in this section is the failure to provide for a minimum rate of interest based on the fund's experience over a period of time. Members' pension contributions usually remain in a plan for a long period of time. If you enact the bill in this form, you'll penalize a member who is terminating employment and exercising transfer rights when the interest rate on the transfer rate is low compared to the rates earned by the member's plan over the long term. Would the minister tighten up the definition, describe what it is he really means and provide some

[ Page 12976 ]

explanation for the failure to provide a minimum rate of interest?

HON. MR. RABBITT: If need be, the regulation will be used to make the definitions. The definition, for the purpose of the regulation, of "defined benefit plan" is that the regulation will provide that the rate must equal the fund's rate of return or the average yield on a five-year personal fixed-term deposit as published monthly by the Bank of Canada. The definition of "defined contribution plan" or "provision" is: the regulations will provide that the rate must be at least equal to the fund's rate of return. Does that clarify the definition for you?

MR. ROSE: I don't know. I'll defer to my colleague, if she wants to go.

I wonder if I could go back one clause. It's gone through, and I don't wish to divert attention or go back and revisit it, except to say that I appreciated Mr. McCulloch's and Mr. Aykroyd's explanation to me when I requested the portability of various sections a week or two ago — and also section 30, the flexibility provision. I appreciate that. I'll talk more about the portability part of it when we get to section 33. At the moment I'd just like to say that I appreciated their assistance on the various sections of 30, including subsection (5). I'll leave it at that.

Section 31 approved.

On section 32.

MR. ROSE: These are minimum employer contributions for funding pensions, and as drafted may not be as strong as they could be and may not ensure that the member receives a pension worth double the value of the member's contribution with interest. That's really the half-and-half contribution thing. That's why we're concerned that it may not.

That isn't the big problem that we have with it. Section 8 excludes the public sector. I don't know why this has happened. Why the underfunding when the public sector plans are excluded from 50 percent minimum employer contribution provisions of the legislation? The basic plans are underfunded. We should bring them up over a period of time rather than exclude them altogether. Why was this done?

HON. MR. RABBITT: If I can refer to my notes, public sector plans are exempt from the 50 percent rule because they provide a generous pre-retirement indexing of deferred pension benefits. These are legislated plans. A member or union representative who feels that this exemption to the 50 percent rule has resulted in an unfair experience can raise this matter publicly.

The reason there is not a similar blanket exemption available to private sector plans is that not many provide pre-retirement indexing and adequacy varies among those that do. This is an issue which could be further examined when developing regulations in consultation with the industry and the community.

MR. ROSE: The public service industry?

HON. MR. RABBITT: No, this is the non-public-service plan — that sector.

MR. ROSE: That was a slip of the tongue, I take it, because he did use the word "industry." I was wondering if he might have been using it broadly, like we talk about the education industry and the political industry.

Who makes up the difference?

HON. MR. RABBITT: The employer always makes up the difference, so in this case the end result would be the taxpayer.

[9:00]

MR. ROSE: We hear a lot of discussion sometimes about the immorality of deficits, mainly from the other side of the room. What we're mainly doing here, I think, is really creating a deficit for the fund. The minister has just told us that the government or the taxpayer is going to have to make up the difference down the road. In other words, what you're doing is passing off the costs to future generations. This has been the big criticism: the immorality of deficits. "Our children will have to pay that debt," we always hear, accompanied by a lot of chest-beating, moaning and groaning, and hand-wringing.

What this government is doing here is encouraging that in the pension field — passing off the cost to future generations. I just can't reconcile how such a moral government as we see across the way there could recommend such a procedure.

HON. MR. RABBITT: The concern that the member has is fully covered under section 41; we can canvass that at that time. But I think, for the purposes of discussion this evening, that this bill has recognized the fact that there may be a shortfall in the public pension plan. Really, there are also great arguments as to the amount of surplus that governments should tax and put into funds. So there are two sides to the argument. Whether or not the government should have this fully funded or not can be dealt with by policy, and that's addressed in section 41.

Sections 32 and 33 approved.

On section 34.

MS. MARZARI: Once again, this bill affects women's lives. Section 34 covers pre-retirement survivor benefits. We think that this section could be vastly improved if you affirmed the right of a surviving spouse to a choice of receiving a survivor's benefit in the form of a pension or a locked-in lump sum payment.

The value of the survivor's benefit should be equal to the commuted value of the deceased member's pension, should that member die before retirement. Doesn't that make eminent sense? After all, whose money is it? It belongs to the family, one would think;

[ Page 12977 ]

it belongs to the person who's been paying in, one would think.

Why doesn't the surviving spouse of a deceased pensioner have that choice?

HON. MR. RABBITT: This concern has been registered with the ministry on the consultation, and while half of Canada works on the 60 percent figure, half of Canada works on the 100 percent figure, we've brought in the 60 percent figure, and I'm going to be referring this particular item to the advisory council.

Sections 34 to 40 inclusive approved.

On section 41.

MR. ROSE: This section was referred to by the minister a little while ago. There are a few questions associated with it. It limits the employer's liability in that employers are "contractually required to contribute to the plan." I'm not sure how that works, but it seems to me that if there's vesting, he's liable for the whole chunk after the vesting period has been reached. I'd like to know what his contractual obligation is; I'd like that explained for me.

Supposing the employer withdraws from the plan or otherwise fails to meet the bill's definition? Surely there must be a liability for all the arrears if they don't remain solvent or go bankrupt or something like that. There are a couple of questions about that that I think should be clarified.

HON. MR. RABBITT: My learned staff inform me that subsection 41(4) only affirms the contractual obligations of negotiated cost plans.

MR. ROSE: I'm not sure I understand that. I wonder if you could elaborate a bit on that.

HON. MR. RABBITT: A negotiated cost plan is limited to money only, and that's what this clause does: it limits the money paid by the employer. I hope that clarifies it for you.

MR. ROSE: Unfortunately, I didn't quite hear it. I assume it's okay.

What happens in the case of bankruptcy? What protects those people who are owed pensions? Who has the first draw under bankruptcy? What I'm interested in is the transfer of funds, and the other thing is the cash flow. Somebody could take some of those funds illegally, if they were short of money, and just not fulfil their obligation to the plan, because sometimes these plans are controlled not by the employees but by the employers.

I might have deflected you, because I talked about two or three different things. Some people have a logical, linear thought process, and others have a branching thought process. Mine is kind of all over the place sometimes. But could I get back to the point about the protection of the obligations to the employee in the case of bankruptcy or transfers?

[Mr. Ree in the chair.]

HON. MR. RABBITT: Yes, the trust funds are kept in a separate account. By keeping them there, they are separate from the other accounts and protected against a bankruptcy claim.

MR. ROSE: They're supposed to be kept in a trust fund, but that's not the information I have of what happens to them. Somebody thinks that what you've got for the employer's contribution is a big bagful of money here, and over here is the employee's contribution taken from him every month — and that is a big bagful of money. But usually what happens on the employer's side is merely a credit of a certain amount to meet the obligations of the employer at some future date.

There are, and have been, startling examples of the shifting — milking, if you like — of funds from the so-called trust funds. There have also been examples where the employees' cash, which is really deferred wages deducted each paycheque, is being diverted to improve the cash flow. Now you have a little section here, section 43, that adds some protection about that. But I'm not satisfied that I've really had a decent explanation, or else I must be obtuse as to how an employee is protected under those circumstances.

HON. MR. RABBITT: Although we're still on 41, section 42(l) specifically states that the funds must be held in trust. It should also be noted that if the funds are not held in trust, they lose the income tax status that the corporation needs as well. So I think you have to recognize that there are various checks and balances.

Sections 41 and 42 approved.

On section 43.

MR. ROSE: Who's culpable here for delinquent liabilities? I don't think this is strong enough. I think the section is good. It might be better if contributions were expanded to the directors and if they were equally culpable, but at the moment they're not. It would better protect members against any unauthorized diversions of the fund.

I like the idea about the expense of the pension plan contributions, that sort of thing, and the protection, especially when the business is experiencing financial difficulties. I can only say that I think this section probably needs a lot more publicity, because I don't think many people even know about this. I think it's important that they do.

Another important thing, which I talked about in my second reading speech, is contribution holidays. I think they should be part of a decision of the board of trustees, 50 percent of whom are former employees. What we've had are contribution holidays where the employer takes a holiday but the paycheque deductions continue. So if there are going to be contribution holidays, they should be reciprocal.

I don't like the idea of contribution holidays. If you get a so-called surplus that would necessitate a move

[ Page 12978 ]

towards a contribution, then I think you've got two choices: to reduce premiums or increase benefits. I don't think anybody got too fat on pension plans. So the contribution holiday from a company because of investment policies, or whatever, should be equally spread among the employer and the employees. I don't even think there should be a contribution holiday. I think it should build up into a bigger pension, or else reduce the premiums, but not holidays for the company and no holidays for those people who have to have the money deducted from their paycheques.

MR. MILLER: Section 43, the section that allows for contribution holidays.... The minister started to rise and seemed to take some comfort because the Chairman wasn't looking at him. He sank back down in his seat and clearly indicated that he wasn't prepared to debate this section at all. If the minister wants to say something before I do, let him go ahead.

HON. MR. RABBITT: It's interesting. I'm simply wishing to share the floor with members of the House who wish to enter into the debate. But yes, I have a couple of comments I'd like to refer to.

The administrator or the fund holder has to notify the superintendent in writing if there's a failure to remit. It should be noted that corporate officers and directors are already jointly and severally liable for up to two months' unpaid wages under section 19 of the Employment Standards Act. This includes money required to be paid for an employee's benefit under the contract of the employment to a fund, insurer or other person. I believe that we have in fact protected and set up a network to protect, on the particular question you had.

I'd like to spend a moment on the whole question of surpluses and contribution holidays. That whole area is rather misunderstood. I do have a prepared note, and I would like to share that with you today. It seems to me, because of this confusion, that we should spend a few moments to let my learned friend who sits behind my critic there share in some of the concepts that — at least I feel — have built this bill and pulled it all together. I agree with my critic when he says that pensions are deferred wages, but I disagree with the member on some other things that he spoke on. If I may, I will refer to my notes.

[9:15]

You can take those deferred wages and put them in an RRSP or a defined contribution plan and let them earn interest, and at the pension age buy a life annuity. You can even buy a partially indexed life annuity, which begins with a lower limit. In such cases the employee takes the risk that the interest rates will be low at the time he or she purchases the annuity. Life annuities are by law sold only by insurance companies. I am advised that no company offers for sale a fully-indexed life annuity, because there is no fiscally responsible way to calculate the price of a fully-indexed life annuity.

You can take those deferred wages and put them in a defined benefit plan. A defined benefit plan is usually better for employees because the downside risk is transferred from the employee to the employer. The employee is promised a pension amount calculated by a formula based on years of service and highest average wage for a specified time-period. By section 32(1) of the bill the employer has to pay at least 50 percent of the defined benefit pension. If a plan doesn't have enough money to fulfil the contractual promise, the employer is liable to pay the difference — that is, to pay more than 50 percent.

Many people believe that it's fairer that the party who takes the downside risk should also receive any upside benefit. Section 24(1)(g) provides that plans must provide for the treatment of surplus assets, which allows the parties to work out their own solution. Many plan trusts were silent on this question in the past, which has been the main problem.

Section 61 provides that surplus assets can be paid or transferred only as the plan provides and after the superintendent has given written notice.

Section 62 provides for an arbitration of disputes on surplus or other matters. What some people fail to understand is that even fully-indexed plans could have surpluses. Why should these surpluses belong to any group — employees or employers? Consider the public sector provision plans in this province. They happen to be well indexed. The employees contribute extra for this indexing. Admittedly, these plans are not fully funded at the moment, but what would happen if they achieved a surplus? Why would that surplus belong to the employees instead of the taxpayer?

A legislated policy that all surpluses belong to the employees would cause some employers to abandon defined benefit plans or to convert a defined contribution or group RRSP plans, or even to not have pension plans at all. Others could adopt a more restrictive funding scheme to ensure that there is no surplus, or change the pension formula to a lower initial benefit, for example from 2 percent to 1 percent per year of service.

Contribution holidays are also not well understood. Contribution holidays occur when a plan is in a surplus position. If the surplus exceeds 24 months of contributions, Revenue Canada will not allow contributions to be tax-deductible as a business expense. It seems peculiar to say that an employer must keep contributing regardless of the fiscal soundness of the plan. Section 43(2) provides for the possibility of a contribution holiday where a plan has surplus assets and provides for a contribution holiday. Arbitration covers disputes about such provisions.

Some pension plans are negotiated. Some negotiated plans may provide that employees and employers split the surplus. If that is what they've agreed, why should the government overrule a contractual provision?

I've been contacted by a lawyer for the retirement committee of one non-union pension plan in B.C. where there is such a surplus. This is a firm which is in financial trouble. There is a possibility that the pension plan members will agree to splitting the surplus in a way that balances the interest of the members with attempts to keep the firm alive. If the plan members agree unanimously or overwhelmingly to this pro-

[ Page 12979 ]

posal, I find it hard to understand why legislation should prevent this.

Mr. Chairman, pensions cover at least two generations — 60 years or more. They are complex matters. In complex, long-term matters it is possible to imperil plans that bring adequate benefits by legislating rigid rules for surpluses and contribution holidays. The bill legislates sensible provisions for surpluses and contribution holidays without harming pension plan members.

MR. ROSE: As I said the other night, Mr. Chairman, it depends on your attitude, on your philosophy, on whether you agree that these are deferred wages or not. I don't think any plan should be imperilled by excessive demands or anything. It seems to me that we can go right back....

If pensions are deferred earnings, and there are surpluses to the liabilities, it seems to me you've got two choices: you could increase the benefits or lower the premiums. For one side to stop contributing while the other continues, or to view this as the company's money rather than the employees' money — I say it's their money: the company's and the employees' money — is to look at it in a one-sided way. Surpluses, main contribution, holidays — according to some people's viewpoint; it doesn't happen to be mine.... It didn't happen to be the court's in the Dominion Stores Ltd. issue either, and I'm not sure what the outcome was for the Bank of British Columbia — which is now the Hongkong Bank of Canada — with their $25 million attempt to scoop funds out of that fund.

In any event, we've made the point. I don't think we can make it any more clearly than that. We don't believe in this. We would rather have the funds produce a greater and larger pension, or — to say it for the fifth time — lower the premiums. Otherwise what you're doing is looking at it based on the assumption that the business of a pension plan is charity. We'll leave 41 at that, Mr. Chairman.

MR. CHAIRMAN: There is a convention going on which pre-dates the July convention. Possibly it could be held other than in the chamber.

MR. MILLER: The minister just read a rather lengthy note about this section and taking surpluses. I was a bit struck with what appeared to me to be a contradiction. At the outset he said that contributions are deferred wages. Then at a later point — in the same missive that somebody wrote for him — he raised the question of what we should do with these surpluses. If the minister truly believes that contributions are deferred wages, then there's only one answer you can come up with. They have to accrue to the benefit of the employees.

While I'm on my feet, the whole matter of people trying to get adequate pensions really has a history of a long battle in this province. It hasn't been that long, quite frankly, that even people who belong to quite strong unions have come into the twentieth century with regard to some of the benefits they now get which, compared to benefits that we get, are minuscule.

There is generally, by and large, no indexing or provision for people who have already retired. They become major scraps in negotiations whenever they occur — every couple of years in some of the major industries in our province. My own experience, quite frankly, is that most of the people I've seen in my industry don't live very long, in order to collect the pensions they had to fight like hell to get in the first place.

I'm not satisfied with the minister's answer. I think he had some clever three-page thing that somebody wrote for him. But he hasn't really dealt squarely with the question. If he believes that pension contributions are deferred wages, then how can he possibly talk about people being able to take that money and do any other thing with it, other than giving it back to the people whom it should belong to — either in the form of higher benefits or some other benefit? I would like the minister to respond to that apparent contradiction in his remarks.

[Mr. De Jong in the chair.]

HON. MR. RABBITT: Quite simply, the member, who has such a great background in the union movement, should know the difference. Pensions are deferred wages, but contributions are not. Surpluses may or may not be deferred wages, and that depends on the pension trust.

MR. MILLER: Mr. Chairman, the minister seems to want it both ways. Where does pension money come from? It's made by contributions from the employer and the employee. Forget the ratios and anything else: how do they come about? They come about because people bargain. Sometimes they go on strike, which you guys always object to. Sometimes they even have to go on strike in order to get a pension. Quite frankly, I think some of the major pension reforms probably came about because employees hit the bricks when they had to. It's their money. They fought for it, and they contribute. The employer contributes the share that they should; it is their money. That's deferred wages. How can you possibly say that if there's a surplus, it's somehow not linked to the employees, who make the contribution, and the employer, who makes a contribution instead of giving the money to the employee?

And there are all kinds of other things. Most of these plans don't allow the employees — which is not in this section — the opportunity to even have much say in directing some of that money. But the minister needs to clarify this contradiction.

HON. MR. RABBITT: Some pensions come about as a result of collective bargaining. I'm familiar with strikes. I've probably spent more time on a picket line than you've spent in this chamber. But I could also add that some pensions come about other than by bargaining. That's the reason there's a difference.

[ Page 12980 ]

MS. MARZARI: Sections 43, 61, 62 and 78 deal with surpluses. All these sections deal with the disposition of surpluses and how employers are allowed to play or not play with these surpluses. It's been put to me by a constituent that this whole bill seems to revolve around this question of surplus, and that the gains made by individuals as potential pensioners are nowhere near as great as the gains to be made by employers as they are finally told by government how they can play with surpluses.

It strikes me that the major problem here is in the nature of the defined benefit plan in the first place. The defined benefit plan is very often held out to employees as the answer, because it will give them some kind of guarantee in their old age. When the employee buys into that defined benefit plan, as opposed to a money purchase plan where the employee has a lot more say in what goes on with his money, the employee is often giving up far more than he or she should. Employee groups apparently end up paying far more and getting far less than they should, because they're buying themselves a guarantee. What they're also buying themselves, apparently, is a writing-off of any potential surplus which is above and beyond what the plan will actually pay out — above and beyond the defined benefit.

[9:30]

I come back to that woman who has entered the labour force. Perhaps a woman comes into the secretarial pool of a firm or an agency, works for two years, decides to have a family and pulls her pension fund — if she's been paying into one — out of the company. But the employer's contributions remain locked in, or inside the pension plan. She will not be able to access the employer's contribution down the line; she is simply left with the bit that she's put in. Somewhere along the line the employer's contribution for her two years builds up, collects interest and sits there in a pool. Somewhere down the line that pool starts to be defined as a surplus, which that employee or her colleagues will never see in terms of pay-out down the line.

We have companies and agencies — in fact, our three universities, I gather — which are engaging in divvying out the surpluses from their defined benefit plans here in B.C. Employees do not like it. They do not like the terms of reference of that defined benefit plan and, as they're becoming more sophisticated and understanding this better, they see the universities and the agencies — their employers — walking away with their equity, sweat, labour and investment. They see them using their money and calling it surplus, basically scooping it out for whatever purposes — whether it be Dominion Stores, the Hongkong Bank or a university that talks about inability to pay and uses contribution holidays as a way to save money.

This is blatantly unfair. We have to recognize it as blatantly unfair. Perhaps one of the first things the minister might ask his pension advisory committee to do is to review the definition and the terms of reference for defined benefit plans, because they are being abused and are creating anger in our community as an increasing number of people approach retirement age and understand that they're not getting their money's worth. Would the minister agree to setting that as a term of reference for his new committee?

MR. SMITH: On section 43 and as well on the issue of surpluses and portability, I'm wondering, with respect to the solvency test issue, whether this legislation's standards will apply to all of the various and sundry publicly funded pension programs we have around here.

The opposition House Leader, for instance, has been giving us a learned demonstration this evening of his knowledge of pension plans, the way in which they're funded and the extent to which they're solvent. I think that's important, and no doubt it's particularly important to him. But I'm concerned that the public, I think, has some reservations about the solvency of pension plans, particularly about the solvency of either wholly or substantially publicly funded pension plans. Particularly, they have concerns where a person, for instance, might qualify for a publicly funded pension plan in the federal jurisdiction and simultaneously qualify in the area of education, and might qualify as well, particularly if they serve in the Legislature, in one of the provinces. If they're very fortunate and hang around the public purse long enough, they'll become a real expert in pensions and maybe get four or five public pensions.

AN HON. MEMBER: Simultaneously?

MR. SMITH: Simultaneously. If you're really lucky, you could build it up to perhaps $75,000 a year or more. No doubt all the old-age pensioners around British Columbia and the single parents will be delighted and pleased to know that, and to know that those kinds of pensions will be protected, will be solvent, will have surpluses, and may even have portability.

MR. KEMPF: Point of order, Mr. Chairman. The member opposite in the rump group over there is incorrect. He's talking about five pensions coming out of the public purse for the opposition House Leader, amounting to only $75,000 a year, but I'm sure it's $100,000 at least. I wouldn't want to leave a misconception in the minds of British Columbians out there watching television or anyone in this House.

MR. CHAIRMAN: Hon. member, with all due respect, it's not a point of order.

MR. SMITH: My question to the minister is very straightforward. In view of the concern legitimately expressed tonight about the variety of pension schemes that one can access in terms of the standards and the solvency tests that will be prescribed and available to ensure that there's always money to support those pension schemes, I wonder if the minister could assure the House and all members who are affected and who have interests and concerns on behalf of their own constituents that these standards he has introduced will protect the needs of those who have many oppor-

[ Page 12981 ]

tunities to draw pensions out of the public purse to the tune of $75,000 or, as my colleague has corrected me, $100,000 a year.

HON. MR. RABBITT: The first member for Vancouver–Point Grey has left, but I've made notes on her concerns. I will look at her concerns.

To the second member for Kamloops, the long and the short answer is yes.

MR. MILLER: Mr. Chairman, we were kind of thrown off track here. Some people in our society seem to receive benefits that appear to be disproportionate to others. That was clearly the public reaction last week. I would also note that we've dealt extensively in this House over the last four and a half years with some of the major pay-outs that have been given to people. When I read, for example, that the PNE now has $150,000 in legal bills, and they're looking at a pay-out of over $300,000 because of some interference with the board....

MR. SERWA: Point of order, Mr. Chairman. The member is irrelevant. He's not speaking to section 43, which we're discussing at the present time. He is clearly out of order.

Interjections.

MR. CHAIRMAN: Order, please. The point of order is correct. When we deal with bills, I think the regulations are very specific as to the sections we deal with. I would urge the member speaking to adhere to that discipline.

MR. MILLER: Mr. Chairman, had I been allowed to continue, you would have seen the thread that I had carefully woven to bring us back to section 43. When you're interrupted like this, it is very difficult. I don't think the minister answered the question I posed earlier with respect to the apparent contradiction in his remarks, where on the one hand he said that pension contributions are deferred wages and then he referred to the fact that surpluses somehow should be free to go other than to the workers who should receive the benefit. When I pointed out that people had fought long and hard to achieve those benefits, he then referred to plans that people didn't negotiate for. I don't think it should make any difference whatsoever.

Lots of employers, for lots of reasons — one of them is to keep unions out, quite frankly — are prepared to offer pension plans which they have absolute and complete control over. All we're asking this minister and this government to do is to exercise some discretion through legislation and to try to indicate support for the employees rather than for those employers.

Sections 43 to 57 inclusive approved.

On section 58.

MR. ROSE: This has to do with the change of business ownership. This section and section 63 both fail to make it clear that both predecessor and successor employers should be held liable for unfunded pension liabilities at the date of the sale.

What's the government's intention here? Some of the pension plans are funded to only 20 percent or 25 percent, and that puts someone at certain risk, I think. In the event of the sale of the business, there must be sufficient assets transferred from the predecessor to the successor and a calculation made on the higher of the windup costs and all liability to the pension plan on the date of sale. I would like to know how the unfunded liabilities are going to be taken care of.

HON. MR. RABBITT: The short answer is that they won't be met if the plan goes bankrupt.

MR. ROSE: I suppose the correlative question to that one is: what's the situation in a bankruptcy, if these plans are held in a trusteeship? There has to be some protection. You told us a little while ago, Mr. Minister, that these things were held in trust. Now you've given us an answer that contradicts that.

HON. MR. RABBITT: The funds are held in trust, and the funds are protected. If there is a shortfall and the corporation is not fully funded, then the plan does not get funded. Obviously you can't get money out of a bankrupt company. Therefore if the company goes bankrupt and there's a shortfall in the funding, that shortfall would continue. There's no way to make restitution.

MR. ROSE: What about in the case of a transfer, in which the business is sold and the previous owner or predecessor had an unfunded pension liability at the date of the sale? It's not clear that the successor company would pick up those responsibilities.

HON. MR. RABBITT: Yes, that's the correct assumption.

MR. ROSE: I have a little problem with this, because I don't see where it says that.

HON. MR. RABBITT: My notes indicate that in practice it means the jobs would be lost because firms would not assume ownership of another company's difficulties. Large unfunded pension liabilities would simply be unattractive. Our view is that section 58 offers adequate protection to plan members in most successor situations and is consistent with the approaches in other jurisdictions.

[9:45]

Sections 58 to 61 inclusive approved.

On section 62.

MR. ROSE: Again, this is not as clear as it might be. Section 62 sets out arbitration provisions and what each plan must contain. But the only issue that seems to be arbitral is surplus assets. I think this could be made more explicit. The arbitration process could be

[ Page 12982 ]

initiated by the trustees of a MEP or a trade union representing the plan. I think the arbitration process could be invoked to obtain contributions from delinquent employers as well. Why were these other powers not accorded to the arbitration?

Again, a lot of this stuff deals with surplus assets and defined benefit plans and gives us the most unease, especially from our point of view.

HON. MR. RABBITT: I should point out that this is a made-in-B.C. policy. It is a newly developed policy, and I believe this act is the first to implement it. It may be that we have been very conservative in the approach here and that in the future we may want to widen the scope of it. I would suggest that if that is the feeling of the government of the day, then that's exactly what they would do. They would refer it to the advisory body, have it studied, take those recommendations and expand it in the areas that were identified as needing expanding.

Sections 62 to 71 inclusive approved.

On section 72.

MR. ROSE: This is to give the administrator power to apply to the Supreme Court to do something or not to do something. Has the government excluded the administrator, the trustees or the trade union representing the members from asking the courts for an order? What's this three days' notice got to do with it? It seems to place the superintendent in a position of judging the issue. I'd like the minister to comment on that if the answer is yes. If the answer is no, I've got some comments.

HON. MR. RABBITT: The three-day requirement is simply for fast action. That's the whole consensus of the three-day proposal.

MR. ROSE: It seems to permit the superintendent to go to court, but no other interested party. Where does it say anything about others going to court: contributors or unions, or other parts of the mechanism, including the trustees? That's where I'd like to have an answer, please.

HON. MR. RABBITT: The other parties can go to court at any time without notice.

Sections 72 to 77 inclusive approved.

On section 78.

MR. ROSE: This is a moratorium giving notice to anybody who's an administrator or an employer if he wants to scoff off surplus assets. He's got all kinds of time to do it. Again, this whole thing seems to be designed.... First of all, the date of the first reading of Bill 44 — this is the grandson of 44 — was June 26, 1990. When you have a federal budget, for instance, you have it given in such a way that when the stock markets close.... After all, the sort of insider trading and insider knowledge wouldn't be available to people who can.... There's always a big fight about any kind of budget leaks.

But what's happened here? We gave these people notice that if they want to scoff off from the plan, they've got all this time to do it. I don't like this moratorium. I would prefer to delete this clause. They've already had all kinds of opportunity to do this. Why couldn't it be made retroactive to June 1 — or June 26, the day that Bill 44 got first reading?

HON. MR. RABBITT: First of all, it wasn't made retroactive to the time Bill 44 was implemented, for the simple reason that this clause was not in Bill 44. This clause was initiated for the first time in Bill 89. Had there been any indication at all between the moratorium being brought in, with the introduction of Bill 89, and when Bill 6 was brought in that anybody out there was going to be a bandit and try and scoff funds and run away with them, then fine, I would have made it retroactive. There was no indication that anything had been scoffed or stolen or run away with. I think it's a bogeyman in a closet.

MR. ROSE: If nobody was likely to do that, then it wouldn't really be needed. Why would you need a moratorium? Why would you extend the length of time in which they had the right to do this?

AN HON. MEMBER: They expect someone to give them notice that they're going to take off.

MR. ROSE: That's right. Why the moratorium at all?

HON. MR. RABBITT: Quite simply, for the interim period we want to make sure that, although there have not been any efforts to scoff funds, the pension funds and the benefactors of these pensions will be protected. That is the duty of trust that I feel is given to me as the minister bringing in this bill.

MR. ROSE: You're going to protect people better by giving the employers more chance to withdraw surplus funds. The whole thing is completely contradictory. What you're saying is: "We don't want the horse to get out of the barn, so we're going to leave the door open for two months longer." That's really what you're saying, and that's absolutely loony logic, as far as I'm concerned. I don't care for it particularly, but I guess there's nothing we can do about it.

This is where I think we should have had amendments. If you're not going to accept amendments, I think the intention is just as good. So this particular clause, as far as I'm concerned, can pass on division.

Section 78 approved on division.

On section 79.

MR. ROSE: I like the idea of earlier vesting. I would have liked to have seen it brought in sooner. There may be some technical or physical or financial reasons why it couldn't have been done earlier. But if the money belongs to the contributors, the employees, as deferred wages, the fact that we have vesting after two years of continuous planned membership is a good thing. I don't see any reason that you have to wait, as we do — as the minister corrected me the other night — in the

[ Page 12983 ]

provincial superannuation for something like ten years for any vesting. In these days of early retirement, it's far too lengthy a period. The employee earns the right to have control of both the employer's and his own portions of the funds much earlier, and this is a good move.

Sections 79 to 81 inclusive approved.

Title approved.

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

Motion approved.

The House resumed; Mr. Pelton in the chair.

Bill 6, Pension Benefits Standards Act, reported complete with amendment.

DEPUTY SPEAKER: When shall the bill be considered as reported?

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

Leave granted.

Bill 6, Pension Benefits Standards Act, read a third time and passed.

Hon. Mr. Richmond moved adjournment of the House.

Motion approved.

The House adjourned at 9:55 p.m.