1992 Legislative Session: 1st Session, 35th Parliament
HANSARD
(Hansard)
TUESDAY, MAY 26, 1992
Afternoon Sitting
Volume 3, Number 15
[ Page 1801 ]
The House met at 2:05 p.m.
Hon. L. Boone: Today we have some distinguished visitors in the members' gallery. It is my pleasure to introduce His Excellency Charles Van Overstraeten, the newly appointed Ambassador of Belgium to Canada, and Mrs. Maggy Van Overstraeten. The ambassador is accompanied by Mr. Dirk DeVuyst, consul of Belgium in Vancouver, and Mrs. Merrill DeVuyst. Would the members please welcome them.
D. Streifel: It's my pleasure today to introduce to the Legislature some visitors from Morris, Manitoba. It's Raj and Sharoo Modha. They are here visiting their son Pratik. Pratik is with our communications staff. I bid the House make them welcome.
Hon. L. Boone: I would like to introduce some important people to the members here, people who will be acting as guides of the Legislature. In the Legislature today are John Kay, Colleen Ross, Marnie Caron, Gerard Sasges, Jon Preston and Miranda Duffy. Would the members please welcome them in anticipation of the hard work they will be doing for us over the summer months.
Hon. R. Blencoe: It's my pleasure today to introduce the brother of BCTV legislative reporter Ron Thompson. Norman Thompson is visiting from London, Ontario. I won't share with the House the editorial comment by brother Ron, but I want you to know that Norman Thompson is also a vice-president of the Bank of Montreal. So would the House please welcome Norman Thompson to the House.
J. MacPhail: It gives me a great deal of pleasure today to welcome to the precinct my sister, Joan Snapp, and her friend Barry Sullivan. I think their visit here -- before today, anyway -- will increase the net migration into British Columbia. I hope the House will make them feel very welcome.
B. Copping: I am very pleased to introduce Mr. Mereniuk, 25 gifted grade 9 and 10 students and several adults from Moody Junior Secondary School. Would the House please make them welcome.
SOCIAL SERVICES STATUTES
AMENDMENT ACT, 1992
Hon. J. Smallwood presented a message from His Honour the Lieutenant-Governor: a bill intituled Social Services Statutes Amendment Act, 1992.
Hon. J. Smallwood: I am pleased today to introduce Bill 40, which proposes several minor amendments to the Family and Child Service Act and the Social Workers Act.
The amendments to the Family and Child Service Act have two purposes. One of the amendments will enhance the ability of the superintendent of family and child service to support families, while protecting children. It will achieve this by allowing the superintendent to continue the supervision of children who are returned to their parents following the termination of a temporary custody order.
The purpose of the second amendment is to enable the superintendent to provide support and maintenance to young persons between 19 and 21 years of age, who cease being permanent wards upon reaching the age of majority. This allows for some help to former wards in making the transition from the dependence of childhood to the independence expected of adults.
The amendments to the Social Workers Act have four purposes. The first is to reduce the likelihood of bias on the part of members of the Board of Registration for Social Workers when performing their duties in disciplinary hearings. The second is to rectify an existing procedural matter that could be interpreted as an unlawful delegation of powers by the board. The third is to broaden the range of possible disciplinary measures that the board can apply when a registered social worker is found to be guilty of misconduct or of displaying incompetence. The final purpose is to make the act consistent with other statutes covering persons providing public service in regard to their protection from damage suits for actions taken in the performance of their duty.
Bill 40 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.
Hon. R. Blencoe presented a message from His Honour the Lieutenant-Governor: a bill intituled Municipal Amendment Act, 1992.
Hon. R. Blencoe: The provisions before the House this afternoon constitute a modernization of legislation affecting the management of local government in British Columbia. There are over 90 amendments contained in this bill. The reforms apply specifically to the Municipal Act. The majority of changes reflect resolutions developed over time by the Union of B.C. Municipalities, but for various reasons over the years they have not been able to hit the legislative floor. This time we are trying to bring forward as many of them as possible at once.
Individually, the amendments are minor statutory changes, but collectively they represent a major updating of British Columbia's local government legislation. The changes remove annoyances that have been frustrating local administrators and elected officials for many years, such as the setting of various fee schedules and unclear notice requirements. Other changes clarify some matters for the public, such as procedures for petitioning against a proposed regional district servicing. Several sections make the language of local govern-
[ Page 1802 ]
ment legislation gender-neutral by changing the word "alderman" to "councillor."
Bill 47 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.
NANAIMO COMMONWEALTH
HOLDING SOCIETY
G. Wilson: My question today is to the Premier. Could the Premier advise this House whether or not the apparent past practice of directing the constituency allowances and caucus funds of the NDP caucus directly to the Nanaimo Commonwealth Holding Society is still a current practice by the NDP caucus?
The Speaker: Does the hon. member have a second question?
G. Wilson: With respect to the use of caucus moneys which are essentially directed through this Legislative Assembly, my question.... Perhaps I can elucidate for the proposition of getting an answer here. Through the years 1979 to 1981, for example, the amounts of $207,254, $2,992, $908 and $312,408 respectively were directly funded to the Nanaimo Commonwealth Holding Society. My questions to the Premier are: do you consider that to be an appropriate use of taxpayers' money, and is this in fact still a current practice in the NDP caucus?
[2:15]
Hon. G. Clark: I'd just like to say, first of all, that the Leader of the Opposition's questions are not a subject of question period, nor are they within the Premier's or any of our areas for which we hold responsibility in the executive council. I think questions regarding this matter are subject to vote 1 appropriations, which are quite properly the Speaker's and the members' for discussion. Frankly, I'm not sure any of us is equipped to answer those kinds of questions. That's where the appropriate questions should be directed.
G. Wilson: In light of the fact that the government has failed to act on the question of the Board of Internal Economy, and in light of the fact that the Board of Internal Economy has not been called, we have no effective way of dealing with this matter. Could the Premier tell us whether or not he believes, in the use of funds that are dedicated to opposition accounts, that this direction of public moneys is an appropriate use of taxpayers' dollars which are to be used for the maintenance and management of constituencies in the province?
Hon. M. Harcourt: Hon. Speaker, I think you've heard from the House Leader that.... The Leader of the Opposition is asking about what previous MLAs did with their constituency allowances, which is, as you are aware, hon. Speaker, a matter that is of this Legislature out of vote 1, is not something not the executive council deals with, is not what I deal with in my capacity as Premier, and is, quite frankly, a serious infringement that the Leader of the Opposition is trying to get involved in, telling other MLAs what they should be doing with their funds. If it's seen as entirely appropriate for every MLA to have funds to run their constituency office, that is a matter between the MLAs and the Speaker in vote 1. I am very concerned about the infringement of the rights of MLAs by the Leader of the Opposition.
INDEPENDENT SCHOOL FUNDING
H. De Jong: My question is to the Premier. As the Premier promised prior to as well as during the election that the NDP, when they formed the government, would continue to provide the same level of funding towards education in independent schools as was in place the previous year, will the Premier confirm today that he and his government will stand by that promise?
Hon. G. Clark: In the absence of the Minister of Education, let me simply say that you will notice in the budget that the formula, which is roughly 50 percent of the per-pupil cost in the public system, provided to the independent school system has been maintained.
H. De Jong: Again to the Premier. I know that the independent schools have been informed by the Minister of Education that the funding for educating special-needs children has in fact been cut for this next school term. Does the Premier not agree that education for children requiring special-needs education is of equal importance within the independent schools as it is in the public schools?
Hon. M. Harcourt: I'll take that question on notice for the Minister of Education, who is not here today.
The Speaker: The question has been taken on notice. Does the member have a new question?
H. De Jong: It's a follow-up to what has been asked already.
The Speaker: Unfortunately, hon. member, unless it is a new question, I cannot allow a supplemental to a question taken on notice.
Interjections.
The Speaker: Order, please, hon. members. Please proceed if you have a new question, hon. member.
H. De Jong: Will the Premier then reconfirm his election promise to parents of special-needs children that this government is not going to push these children into the public schools by withholding the funding for these most precious children who are currently receiving their education in the independent schools?
Interjections.
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The Speaker: I assume that that question will be included in the questions taken on notice by the minister.
NANAIMO COMMONWEALTH
HOLDING SOCIETY
W. Hurd: Hon. Speaker, my question is to the Attorney General. Has the Attorney General studied a copy of the 1988 report by the commercial crime section of the RCMP into the affairs of the Nanaimo Commonwealth Holding Society?
Hon. C. Gabelmann: No.
W. Hurd: Is the Attorney General asking this House to believe that he has not read a report by the RCMP on a society which, in the past, has received funds from individual members of his caucus in this House? Is he asking us to believe that he has not read a report by his own Gaming Commission on the performance of this particular society in the past three years?
Hon. C. Gabelmann: Yes, I'm asking you to believe that.
The Speaker: Final supplemental, hon. member.
W. Hurd: My final supplemental is about illegal acts; perhaps the Attorney General can advise us about that. Under the Society Act, is the Nanaimo Commonwealth Holding Society legally entitled to make contributions to a fund set up on the basis of the donation of constituency allowances from individual members of this House?
Hon. C. Gabelmann: Hon. Speaker, the responsibility for the Society Act is with the Minister of Finance.
A. Warnke: Hon. Speaker, my question is for the Attorney General as well. It concerns the parameters of the investigation of the Gaming Commission -- which the Attorney General mentioned yesterday -- into the affairs of the Nanaimo Commonwealth Holding Society. I'd like to ask the Attorney General whether it would be within the purview of the Gaming Commission to examine all expenditures of the society, including moneys paid into special funds.
Hon. C. Gabelmann: I'm not entirely clear what the member means by his question. Let me say that the Gaming Commission -- it was established independently of the ministry -- is responsible for governing activities in respect of gaming in British Columbia, whether it be bingos or casinos. The Gaming Commission looks after those issues and is independent. I understand that the chair of the Gaming Commission indicated yesterday that he intends to investigate issues further in respect of the Nanaimo Commonwealth Holding Society. Some other elements of the question, if I understood correctly where they were going, are matters that would more properly be in the purview of the Minister of Finance.
It might be important for me to say, in addition to that, that if there are any suggestions of violations of Criminal Code matters -- and there have been some media quotations to that effect -- then clearly the responsibility of anyone who feels that is to report it to the police. It's the police who investigate Criminal Code violations, not the Attorney General. Beyond that, I would simply say that should there be any further questions beyond the Society Act, the Gaming Commission or the possibility of Criminal Code violations, I'd be glad to entertain those questions, but I don't know what they are.
A. Warnke: In light of the answers yesterday and today, there is another question I'd like to address to the Attorney General with regard to the reports he's mentioned, reports levelled at the society that they charged charities $41,000 a month for building space that cost them only $7,000 a month and inflated operating costs in which concession revenues of more than $240,000 netted far less in overall profits. In light of some of these serious charges and allegations, why is the Attorney General satisfied that all that's needed here is a simple investigation by the Gaming Commission and not a full, independent investigation by his ministry or the RCMP?
Hon. C. Gabelmann: At this stage -- and I emphasize, at this stage -- all I have to go on are some media reports, beginning, I believe, on Saturday in the Vancouver Sun, and some other commentary that has been made. I would prefer to wait until I see the review by the Gaming Commission before commenting further. But given the political connotations in an issue such as this, when it involves the Nanaimo Commonwealth Holding Society, I think it's important for me to say, in addition to all the things I've said so far, that should there be any other questions, I will refer those questions to the Deputy Attorney General to ensure that no one believes that there would be any reference, any interference or any political role by me as the Attorney General, given the political connections that clearly exist between our party and the Nanaimo Commonwealth Holding Society. Should there be -- and I emphasize that -- any need for any further small "i" inquiry into any other....
Interjection.
Hon. C. Gabelmann: We'll see on that, hon. member. I suggest to all of those who have those concerns that they not raise them with me, because of the fear that there may be some conflict, but rather that they go to the Deputy Attorney General, who will operate on those matters fully independently from me.
The Speaker: Final supplemental, hon. member.
A. Warnke: Just a very short final supplementary, again to the Attorney General. Is he aware that Revenue Canada is investigating the affairs of this society to
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determine whether it has kept proper records of revenues and expenses, and does he expect to get any report thereof?
Hon. C. Gabelmann: I was not aware of that, hon. Speaker, but I will ensure that the questions that have been asked in the House, the media reports that have been carried so far, and any other information that may be available or may be in the air, as it were, will be referred to my deputy for his consideration.
D. Mitchell: Again to the Attorney General on the matter of the Nanaimo Commonwealth Holding Society. I'm pleased that the Attorney General has indicated that this is an important matter. Indeed it is, although it's astonishing that he has not familiarized himself further with some of the details. My question to the Attorney General is this: does this fund, into which some MLAs' constituency allowances have been paid in the past, in his opinion constitute any violation of the members' conflict-of-interest guidelines or act?
[2:30]
Hon. C. Gabelmann: The answer is no. Accounting services have been provided by various accountants and accounting firms for some MLAs in various parties over the years. Rather than having a constituency assistant do the accounts for them as moneys come in under vote 1, some MLAs have actually contracted out their accounting activities. The Nanaimo Commonwealth Society -- I may not have the name correct about who actually does the accounting services that are provided there -- has on occasion, not for me, but for some MLAs, provided.... [Laughter.] No, I've never used them; my constituency assistant has always done it. But it has provided accounting services. That is not illegal under any law that I know of in this province.
The Speaker: The bell ends question period.
The Minister of Advanced Education is answering a question taken on notice.
FAIR WAGE POLICY
Hon. T. Perry: I rise to respond to a question taken on notice from the hon. member for Prince George-Omineca yesterday. At my suggestion yesterday, after raising his question the hon. member tabled in the Legislature the document to which he had referred. That has enabled me to provide him with an answer now. I'm going to refer to the answer prepared for me by the ministry in consultation with the University of Northern B.C. Simply to refresh hon. members, the question related to whether the University of Northern B.C. was requiring as a condition of contract that only unionized labour could be used on construction projects.
I answered at the time that that was not consistent with the government policy. The tender documents for the exterior of the laboratory building, which were provided by the hon. member yesterday, were issued by the UNBC's project manager, Sandwell Inc., on May 15, 1992, with a closing date of May 29, 1992.
A previous contract for this building, for its foundation work, was awarded to the low bidder, Foundation Building West Inc., a unionized firm. Portions of work for the building exterior tender involved direct installation upon the foundation work. In two locations within the specification for the building exterior -- the document provided by the hon. member yesterday -- reference is made that the work to be done is to be carried out by the B.C. and Yukon Building and Construction Trades Council union labour. This reference was issued by the project manager in error. It was issued by the project manager, not by the ministry, the government or the university per se. An addendum to the project is being issued by Sandwell Inc. immediately to all bidders for this project. The clauses referred to will be replaced by the following: "All work covered by the subcontract, which requires on-site installation, must be carried out by contractors practising the fair wage and skills development policy." That is consistent with the government fair wage policy.
We have the assurance by the project manager, Sandwell Inc., that the entire construction of the University of Northern British Columbia is open to bids by all qualified trades, regardless of union affiliation. Further to the memo of May 25, 1992, we have also been advised that the tender closing date has been amended as a result of this addendum change and will be extended from May 29 to June 5, 1992. I thank the member for Prince George-Omineca for bringing this to my attention. I assure all other hon. members, while I have the chance, that should they find some similar error in contracting policy, we can easily deal with it if it's brought to our attention either in the House or, more practicably, by telephone call.
Hon. G. Clark: I call second reading of Bill 32.
RESOURCE COMPENSATION
INTERIM MEASURES ACT
(continued)
W. Hurd: I'm pleased to rise in debate today on Bill 32, the Resource Compensation Interim Measures Act, and also to express my concern along with other members of our caucus on the intent of this bill, the signal it sends out to the resource-dependent communities and resource companies in this province, and the impact it will have on investment in resource-based industries in British Columbia. I think it's important to look at the rationale for the government's introduction of this bill and the way in which the government views the issue of resource compensation in British Columbia. I note, with interest, remarks from the Minister of Finance about the whole notion of resource compensation being something that isn't worthy of consideration. I note from some of the press reports on the mineral claim issue, which is potentially the most expensive one that the government faces, that the Minister of Finance is quoted as saying: "I personally reject the notion that these resources are owned by them and we have to compensate, but that's something we're reviewing."
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Some of the other comments from the hon. Minister of Finance regarding the idea of resource compensation are equally interesting. I would suggest that those types of comments possibly are the intent that the government had in mind when it introduced this bill.
As we look at the bill, which sets up a one-man commission to review the whole notion of resource compensation, we have reason to express real concerns about this process arriving at an independent and fair method of assessing resource claims in the province, particularly because the individual heading this commission, Mr. Richard Schwindt, himself is on record as expressing grave concerns about the whole notion of resource compensation and whether or not compensation for claims on public lands deserves to be dealt with fairly and equitably.
It's important for us to ask the question: what is a licence worth? When a resource-based company signs an agreement with the Crown to mine, to log or to engage in a recreation proposal for public land, what do they expect to get when they sign a licence with the province? In the case of a forest licence, they can take that to the bank and borrow money against it. They can actually take the agreement that they have with the Crown to the bank as part of a business plan and suggest to the bank that on the basis of that agreement, the bank should loan them money.
This particular bill suggests that they may borrow the money and expend it, but if for any reason their rights are taken away -- if the land is put into park reserve or designated as a potential aboriginal land claim settlement cost -- they will receive, for an interim period at least, absolutely no compensation for the money they have expended.
It's important for us to ask the question: who in their right mind would approach the bank to borrow money on the basis of a licence they've acquired from the Crown without any idea whether that licence has any value in terms of the government's commitment to it? I would suggest that that's exactly the message being sent out with this particular bill: you spend your money in this province to develop a resource, and in terms of compensation, you takes your chances, and there may be very little, if any, compensation available at the end of the rainbow, so to speak.
The question we have to ask is: what kind of message is this sending out to the investment community? This is really an investment issue. In many areas of this province, in resource-dependent communities, the money spent on new plants and equipment is directly related to the licence arrangements in place. In the case of a forest licence, if you want to expand your manufacturing capacity or if you want to add to the capital assets of your plant, you go to the bank and borrow the money, or you make that investment decision based on the security of access to the resource. This bill suggests that there is no security to the resource. Even if the government does decide to remove that resource for any purpose, which they have a right to do, you're not going to be eligible for any compensation for the money that you've already invested.
I find it absolutely unbelievable that a government which professes to understand the investment community and the entrepreneurs in this province who have to borrow funds from financial institutions and take a risk to identify opportunities for their plants.... They are faced with a bill like this, which basically says to them: "Any rights you have have been rescinded on a temporary basis, and furthermore, there's no timetable as to when we may arrive at a formula to compensate you." That, hon. Speaker, is supposed to inspire confidence in this province in the investment community. It's almost unbelievable that that could be the message being sent out by the government. But in fact that's what we are dealing with here.
I think it's important for us to examine the intent of the bill. Not only does it effectively put a hoist on compensation claims in the province of British Columbia, but it also deals with cases that were legitimately following through an existing appeal procedure. In other words, it cuts off at the knees the cases that are currently being dealt with in this province with respect to resource compensation.
Mining companies in this province, which have spent hundreds of thousands of dollars in legal fees to pursue their cases for resource compensation through the existing structure of appeals, are being told by this government that the process they've been following has been rescinded, and no matter how much money they've spent on legal fees and whatever other plans and programs they've spent money on, they are not going to receive one dime of compensation until Mr. Schwindt and the commission deals with the whole notion of resource compensation in the province of British Columbia.
It's almost incredible that the government would think these people should feel delighted by the way the government has dealt with them. Having gone through this procedure over the past six to eight months -- in the case of mining companies, having their rights being dealt with on questions of parkland reserve -- it's almost unbelievable that they should be asked to swallow this bill and to somehow come to the realization that their rights have been dealt with and that they shouldn't have any concerns about how their cases will eventually turn out.
Again, hon. Speaker, it comes back to the whole notion of the Crown signing licences with people and companies in the province of British Columbia. What is a licence worth in B.C.? Do we not need a government that says to people who come to them with business plans and proposals that at least they're going to be treated fairly and that the government is going to negotiate a licence arrangement with them in good faith? And when the time comes for the Crown to rip up that licence, there has to be some recognition of the cost and the time that they've put into developing that mineral or forest claim. If we don't recognize that principle, what possible inducement is there for somebody to invest money in the first place? There's absolutely no incentive.
If you're a company in this province investigating an opportunity -- whether it be in Trail, Prince Rupert, Mackenzie or Fort St. John -- the government says that you can go out there to investigate a mineral claim or study the possibilities for expanding your plant, but if
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for any reason we have to rip up this licence we're signing with you, you're on your own. We can't be held accountable or responsible for whatever moneys you might have expended or whatever improvements you might have made to your plant, because we don't feel that, at heart, the investment you've made and the licence you've signed have any compensation or redress in law.
That's the message in this bill, and that's the reason why member after member on the opposition side of the House has risen to speak against this bill. It sends out the wrong signal to the investment community. It sends out a signal to foreign investors and to existing licence-holders in this province that there's no further reason for them to invest their money until this matter is dealt with, and the time period is totally indeterminate. We have absolutely no idea when this commission will come up with any recommendations.
We have the assurances of the government side of the House that they believe that no compensation is necessary. We have the commissioner of this particular commission, who in the past has said that no compensation should be available to resource holders, and he's expected to render an independent analysis on this particular question.
I oppose the bill in its current form. As was mentioned by other speakers in this House, in conjunction with other bills being introduced -- Bill 33, the Mineral Land Tax Amendment Act, 1992 and others that have been introduced -- we're sending out the worst possible signal to the investment community in this province. We're basically telling people that, for the time period of this particular procedure, don't invest any money, because you might not get it back. I don't see how a government that purports to understand the business and economics of this province can stand behind this bill with the message that it sends out to the investment community.
[2:45]
The Speaker: I recognize the hon. member for Okanagan....
J. Beattie: Will you recognize me?
The Speaker: Was the hon. member rising to speak?
J. Beattie: I had intended on rising to speak, but I was going to sit down when the hon. member stood. I saw you looking at her, so I thought she was the one who was going to.... I shall yield to the member.
L. Reid: Thank you, to my colleague across the floor.
I'm rising in opposition to Bill 32, the Resource Compensation Interim Measures Act, because I believe it gives the wrong message. This government said early on in their mandate that B.C. was open for business. B.C. is not open for business. This bill is an incredible disincentive for people to do business in British Columbia. It simply says: "Come to B.C. if you are a gambler, but don't expect this government to stand by you as you invest in the resources in this province." Certainly the NDP's promises to settle native land claims, create new parks and all of those kinds of things are going to be done at the expense of the resource industry; no question about that. However, how we treat the resource industry in this province will determine future investments in the province.
The Attorney General said that time was needed for Simon Fraser University resource economist Richard Schwindt to study the issue. Apparently Richard Schwindt is happy to do that. He has three items that he wishes to bring forward, because he believes there are three main elements that need to be addressed. First, there's the question of when the government is required to pay compensation. With fee simple, outright ownership, he says that it's clear the government must pay full value for any land it expropriates. That is the position he's taken, but the SFU academic says: "The issue is cloudier on weaker rights, such as mining claims or timber licences." Certainly my colleague for Surrey-White Rock has enunciated that very clearly. They are not as secure or as valuable in the eyes of this government. We need to examine that.
The second question is the basis by which compensation should be determined: either market value or costs incurred in development. Again, the message that this government must give is that this province is open for business. This particular piece of legislation does not do that. "When a good vibrant market exists, the former may be better" -- according to Professor Schwindt -- "but accurate valuations can be difficult to obtain when markets are narrow." He's saying that this bill is difficult to understand by people in the marketplace, and it's not going to allow people to make clear determinations on what type of investments will be looked upon more favourably by this government. I think his point is well taken.
The last issue is to identify a more effective mechanism for dispute resolution -- an expropriation or the courts. I think that's certainly something this government needs to look at. This matter may well be the nub of the question, as far as Victoria is concerned, as the government would obviously be happy to find a way to limit potentially devastating costs associated with implementing its land use policies or having to fight for these issues in the courts. "Historically there has been very little conflict over land use in British Columbia," the professor goes on to explain, "but as we go into the 1990s, quite clearly that's not the case." Certainly the Liberal opposition has been ridiculed for having a plan, for wanting this government to understand the necessity of a long-range plan for British Columbia -- a vision for this province.
Historically this province has dealt with resources. Whether it be timber or mining rights, we need to have a plan in terms of how we're going to continue to attract investment to British Columbia. Certainly the professor believes that finding alternatives to litigation would benefit the resource companies as well, and I can only concur with the professor in this regard. The B.C. and Yukon Chamber of Mines managing director, Jack Patterson, said that Professor Schwindt's inquiry and the accompanying freeze are clear signals that the NDP government is trying to weasel out of paying for
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compensation. He thinks it's another attempt by the government to not live up to their contractual obligations. They don't want to pay for the consequences of their decision.
The decision not to compensate individuals, particularly in the resource industries, who have been interested and quite delighted on a number of occasions to invest in the province is clearly wrong. It's something we need to take a clear look at. Quite frankly, this bill is the tip of the iceberg. This bill sends the message that if we're prepared to do this to particular investors in this province, we're going to treat other folks who come after.... Certainly the lack of process in this legislation will be reflected in legislation that comes after. Certainly that has been my experience. This government has not given a sense to anyone in this province that they understand due process. This bill smacks of an entire lack of process.
In recent studies that have come forward, they referred to the Windy Craggy copper deposit in the remote Tatshenshini of northwest British Columbia. Those issues and many others, whether they be mining or forestry issues, need to be given some clear mandate, need to have their investors understand truly how important it is to have some sense of long-term planning built into any initiatives that this government would undertake. This bill does not do that.
I do not wish to see this bill go forward. I believe the government needs to understand process. Both sides of the House want to give British Columbians the sense that this government has a vision for resource management. This bill absolutely does not give anyone the impression that we're attracting anyone to do business in British Columbia.
J. Beattie: It certainly is my pleasure today to rise in support of Bill 32, the Resource Compensation Interim Measures Act. As I listened to the members of the opposition talk about their feelings about this bill, I became somewhat disillusioned that their criticisms and comments -- perhaps some of them require some consideration and some response -- missed the underlying philosophical direction that has to be addressed by the introduction of what I think is quite a fair-minded bill.
The opposition members, like all of us, have been keenly observing the public's mood over the last couple of years with regard to the Park '90 process and the whole discussion that has ensued about what is important for the maintenance of land and ecological systems in this province. The public is strongly supportive of maintaining a parks system that represents all of the diverse elements of this vast province, and it also wants land set aside for recreation use. The public has been very clear that they want land set aside. The 12 percent figure, which comes from the Brundtland report, is deemed to be a fairly acceptable figure. Some would like it to be higher; some think it should be determined by some other process, rather than setting some arbitrary figure. Nonetheless, I think 12 percent is quite an acceptable figure from most people's perspectives.
Of course, then the question arises: how do valuable pieces of resource, which have value from an ecological and environmental point of view, become part of the package that the public has spoken so passionately about through Parks '90 and other commissions and studies? I think that this bill is saying, listen, the public wants this land set aside. We haven't seen a process that's fair and equitable. We want to move forward in protecting the land, but in the meantime we have to have a comfort level, the time to set the proper regulations for compensation.
I feel that the Liberal opposition is vastly overstating the actual document, as it exists. There's sort of a "Chicken Little" approach here: the sky is falling. It especially comes as a surprise to me to hear the members for North Vancouver-Seymour, Chilliwack and Richmond East stand up and speak against this bill. They would like to characterize it as some draconian undertaking, when they were the ones who voted for Bill 33. Bill 33 talks about no compensation payable for golf course land, for agricultural land that was within the ALR.
F. Gingell: Two wrongs don't make a right.
J. Beattie: No. But it indicates that there is a complete lack of philosophical direction on that side of the House. They'll stand up and defend their corporate friends and offshore investors, and have this concern; whereas they're certainly willing to take the right stand about agricultural land being protected. Inconsistency, I think, is becoming the hallmark of the opposition party.
I've heard from across the chamber today, and I've read statements made by the member for Richmond-Steveston on Thursday. I sense that this overstating of issues is also becoming a hallmark of theirs -- this feeling that maybe on some smaller issues they'll concede and cooperate for the good of the people, but when it comes to the serious issues, they are going to overstate things and somehow set themselves apart.
Quite frankly, I think the bill says that there will be compensation...
Interjection.
J. Beattie: ...contrary to what the member for Surrey-White Rock has said. There has been absolutely no statement within this bill that people's investments will be lost. The member was talking about the thousands of dollars that have been lost for lawyers' fees and so on -- not to understate the fact that there is some time and money invested.
Interjections.
The Speaker: Order, please.
J. Beattie: But this bill is addressing one of the great requirements that the people of British Columbia have put on this government, which is: establish parks in areas that are worth saving. It just so happens -- it's unfortunate, but it's the way of the world, the way the geological structures took place -- that under some of these wonderful ecological zones that must be pro-
[ Page 1808 ]
tected there happen to be some minerals. We have to make a decision. We are moving rapidly in this.
The member for Richmond-Steveston has talked about being in some post-industrial stage. I fail to see how we're in a post-industrial stage. He speaks as if this province should move back into the hewers-of-wood and the drawers-of-water mentality. We're trying to move away from that into a better utilization of our resources and the establishment of a broad parks system that protects the environment and ecosystems and helps cleanse the water, which is a sink for the carbon dioxide. All of these things are part of the philosophical direction of Parks '90, which is what this bill addresses.
K. Jones: No, it doesn't; it has nothing to do with parks.
J. Beattie: It has a lot to do with it. The member across says that the establishment of parks has nothing to do with the maintenance of the environment and the cleaning of the water. This bill has a great deal to do with that. It's saying, let's put things on hold until we're able to establish what fair compensation would be.
K. Jones: Do you know what the bill says?
J. Beattie: The member talking to me across the floor was one of those members of the Liberal Party who did vote against Bill 33, and I can understand why he's taking his position. However, 50 percent of the Liberal Party voted in favour of Bill 33, and Bill 32 is not in the least as harsh as Bill 33. I think the Liberals have something to come to terms with in addressing where they stand philosophically. I'm afraid they're all over the map.
In closing, I would just like to say that the commitment of the New Democratic Party and this government towards doubling of parks is real. We're rapidly moving, in many areas across the province, towards the destruction of some very valuable resources in terms of watersheds, special land masses and geologically important sites. This bill gives the government time to establish a fair compensation process, which I am very confident will be introduced.
[3:00]
A. Cowie: This government has a clear responsibility to negotiate fair compensation for tenured rights of natural resources that are taken back in the public interest. Fair and equitable treatment of the private sector by government is a key factor in determining investor confidence. This bill sends out a message to investors: your investment may be taken away arbitrarily.
This government has generated the same lack of confidence with the doctors, by arbitrary elimination of the doctors' pension, which creates instability in that profession. This bill will result in less inflow of international capital, which has always been necessary in this province for our resource industries. It sends out a negative message.
I agree that the government will have to take land back for parkland. We on the Liberal side agree that parkland in very unique areas should be expanded from 6 to 12 percent. We agree that compensation, however, should be paid by the normal process until such time as a new arbitration system has been agreed to. This is important to large companies like Fletcher Challenge. It's a Canadian company, but it is tied in with an international multinational organization, which can direct investment to other places. It's important that we continue the confidence to keep the inflow of finances to keep our resources, which are under pressure right now, alive and well. Equally, it would be unfair to the small companies if compensation isn't continued in a similar way as is required at the present time until the new system is set up.
Clearly the government should take another look at this bill.
H. Giesbrecht: Hon. Speaker, I request leave to make an introduction.
Leave granted.
H. Giesbrecht: Hon. Speaker, on behalf of the member for Bulkley Valley-Stikine, who is absent from the House for this time, I have the honour to make an introduction. In the gallery today we have 40 grade 8 students of Chandler Park Middle School out of Smithers, with their teacher, Ms. Short, and several adults, taking in the legislative precincts. Would the House please make them welcome.
J. Weisgerber: Hon. Speaker, it's a pleasure for me to rise and speak on second reading of Bill 32, and to speak against this piece of legislation.
This is the third time in two months that the government has taken their legal rights away from British Columbians, stripping away rights that have been extended by way of contract and removed by way of legislation.
The first we saw were the golf course operators, whereby developers who had made proper applications to develop their property were denied the right to go ahead by legislation; then doctors, who had negotiated, in good faith, a contract to deal with their pensions. Rather than negotiate changes to the contract, the government chose to take away, by legislation, the benefits of contracts which had been freely negotiated by the government and the doctors. Today we see ourselves taking away legal tenure rights, denying compensation for at least 15 months, denying the right to seek compensation for a 15-month period for tenures that might be taken way in order to create parks or settle native land claims.
The minister in his opening remarks suggested that this was necessary because there was no appropriate means of evaluating, of setting a value, on these tenures that might be taken away from resource companies. That's patent nonsense. I think everybody in this House, and everybody who has ever been involved in a transaction involving tenure rights, would know that it's nonsense. Either the minister has decided deliber-
[ Page 1809 ]
ately to cloud the issue, to mislead people into believing that there was no appropriate mechanism to deal with this question, or -- and perhaps even worse -- he doesn't understand the fact that there are appropriate mechanisms in place to allow anyone interested to affix a market value to a tenure. Forest companies and mining companies sell their tenures. They trade in tenures. Companies merge. In all of those transactions there are market forces that allow both parties in the transaction to set a fair market value on the resource, on the right, on the tenure that the government now seeks to deny them the right to sue for compensation on.
If the government wants to put in a period of 15 months in which holders of tenure are forbidden to seek compensation, then it should say so. To suggest it's doing this because there is no appropriate and fair mechanism to establish the market value of the tenure is incorrect. There are many market mechanisms that are entirely appropriate for establishing the value. If that fails, there is already an Expropriation Act that deals with the expropriation of property, be it property for a highway right-of-way or for any other of the many reasons that you may seek -- which may be necessary for government from time to time -- to expropriate property.
I believe that government has a responsibility to provide fair market value compensation for property and rights that are expropriated, and there....
Interjection.
J. Weisgerber: Fair is market, and if fair isn't market -- if that's where we're going; if we're seeking something other than the market price for compensation -- then I think the government has a responsibility to come clean and say that what they are seeking is a way of providing compensation which is less than market value. That may be fair in the mind of a socialist, but it is not related to market value, because there are clearly many appropriate, effective mechanisms to determine the market value of an asset, of a tenure.
What I suspect we're seeking here is 15 months to do a little bit of work and develop a formula that the members opposite like to call fair, which will be less than the market value and less than what you could sell your rights for.
The member in the corner claps, and that seems to me to underline....
Interjection.
J. Weisgerber: Exactly. We're now hearing a little bit of the caucus debate spilling over into the Legislature. We now understand the forces that are driving this legislation. What we are trying to do is find a way to expropriate tenure and tenure rights from resource companies at a value less than the market value. The members keep harping, yiping, yipping and saying: "Fair, fair." It sounds like a bunch of canaries over there.
Let's think a little bit about the effect in British Columbia on the economy, job stability and investment if the practice of this province is not to compensate for tenures at market values. If, in fact, the decision is to provide lesser compensation, I suspect that companies will be less willing to make an investment in their properties. They will be less likely to improve their properties if the compensation they're going to receive is not market value. Therefore we will see less activity in the forest and mining industries, and that means fewer jobs in those industries. That means fewer jobs in the rural communities in British Columbia, less prosperity in this province and lower returns to the province. Let's understand that the biggest and most immediate impact and effect of this legislation will be to reduce investment in our resource industries. Companies will simply be unwilling to make investments based on their tenure if they don't at least have the comfort of knowing that, if it's going to be expropriated, it's taken away at fair market value.
[E. Barnes in the chair.]
We will see corporations decide not to reinvest in new plants and equipment, because they don't have the security of tenure. I suspect, quite frankly, that their bankers will be less willing to give them the money they need if they have no idea of the compensation that the company might receive should its tenures be taken away. Very few people, I suspect, have much sympathy anymore for large corporations, and there's kind of a feeling of to heck with them; they got these tenures for nothing, and we'll take them back for whatever we can get away with paying.
Understand that a mining tenure is worth only the fact that it's been discovered. Somebody went out there and found it, somebody did the exploration on it and somebody developed it. That's what gives a mining claim its value, and certainly its value is the market value. If the company spent a million dollars developing a mine and there is no ore body that is economically mineable, then the mine has no value. On the other hand, if the company is successful in finding a valuable ore body, then I believe that the company is entitled to fair market compensation if the government decides to take away that resource that it discovered.
[3:15]
Interjection.
J. Weisgerber: The minister says "for all the ore." I say yes. They found the ore, and they therefore have...
Interjections.
J. Weisgerber: Everyone is getting excited about this, and it's interesting. But we have here a piece of legislation introduced by the Attorney General who in 1972 made some comments about property values, which he now wishes he hadn't. Here's a minister who as a backbencher said he didn't believe people should have the right to own property. He says now that it was a foolish thing to say, and I guess we've all said things that we wish we hadn't, but it's a bit disturbing that it would be that member who made those comments -- and I assume he believed what he said in 1972 -- and he
[ Page 1810 ]
has somehow seen the light in the 20 years since he sat in opposition, and now introduces a piece of legislation that seeks to take away legal property rights from individuals -- legal tenure rights.
It would seem to me to be a very, very short step from this legislation to the next step: to where we take property away from individuals by expropriation, not at their market value but at the fair value -- perhaps what the fellow paid for his house in Vancouver in 1942. Maybe that's the fair value that he paid for his home that we now want to take away to put a road through. Why wouldn't we apply the principles that you're going to apply in this legislation? Why then won't you extend it? Obviously you're not going to do that because it would be so patently unfair and so unpopular. At least I hope you're not, although I don't see anybody shaking their head over there, so maybe that's where we're heading down the road.
Aside from the fairness of the policy, let us think about the implication for the economy. That, at the end of the day, is the most serious implication of this legislation, because clearly you will have fewer mines developed if you follow through with this policy, . You will have fewer people looking for mineral reserves, you will have fewer people working to develop mining properties, and you will have less investment in perhaps secondary manufacturing -- value-added manufacturing -- in the forest industry. That, at the end of the day, is the implication of this legislation that is most damaging.
I suggest again that the delay is not because there is no mechanism for establishing a market value; the delay is because the government wants to compensate tenure-holders in some other way.
H. Giesbrecht: Fair.
J. Weisgerber: The member has predictably chirped up "fair," because they've obviously had that drilled into their minds. But I suggest to you that "fair" is the market value. If we have a bunch of free enterprisers in the NDP -- to which they have become newly converted -- they would adopt the marketplace as the fair value. But you have an Expropriation Act and an expropriation commissioner who has the capacity to set value.
The minister suggested in his opening remarks that settlements were up and down and all over the place, and that there were no consistent settlements. I would challenge that; I don't think that's correct. I think there has been a formula and a precedent set. There is a process that has been successful for many, many years. In fact....
C. Evans: The rich get richer, and the poor get screwed.
J. Weisgerber: The socialist's socialist down there in the corner suggests that the rich get rich and the poor get poorer. I suppose that was in the primer, and perhaps he hasn't got beyond the primer into lesson two in socialism in British Columbia today.
In any event, the Supreme Court has suggested that a government has an obligation to provide fair compensation. I suggest to you that fair compensation is what you could sell it to someone else for: the fair market price for a property. I think that's absolutely essential.
Let's understand that small communities in British Columbia will be the first or the second -- perhaps the tenure-holders themselves will be the first -- to feel the pain of this legislation. But immediately afterward, workers in small, resource-based communities will start to notice that resource industries and the companies that have been developing, expanding, investing and diversifying in their communities are just a little bit less willing to do so, because they feel threatened by this legislation.
Hon. A. Charbonneau: Just a little bit.
J. Weisgerber: If the minister doesn't understand the effect of even a little bit of a reduction in the company's willingness to reinvest and to commit, then he doesn't understand the economy of this province very well. It will be workers in small communities and the rural regions of British Columbia who will be affected by this legislation initially. It will be places like Campbell River, Dawson Creek, Kamloops, Kelowna and the Kootenays that will feel the effect of this. It is having an effect in the business community.
If any of the members of the NDP don't believe that, go and talk to the people who make investment decisions and who create jobs in this province. Ask them what they think and how they feel about this legislation and about your idea of fair. I want to tell you that they aren't very comfortable with your idea of fair, and they are much more comfortable with the marketplace's definition of fair. I believe that if the purpose of this legislation is to find some mechanism other than fair market value for compensating for tenure, then let's hear it. Step up and say so, because....
Hon. C. Gabelmann: The market value of Strathcona Park is zero right now.
J. Weisgerber: I suppose the minister will have an opportunity to give his closing remarks. We are on, at least I hope we're on, the verge of starting serious land claims settlements in this province, along with the expansion of parks -- what this legislation is all about.
I question, I have questioned and I will continue to question the government's approach to settling land claims and their approach to the Gitksan decision. That's an argument for another day, but clearly we are going to see tenures transferred as a result of land claims settlements. How many? We don't know, but we know that tenures will be taken away from existing tenure holders to create parks and to settle land claims, and it is obvious to me that the government has decided that they are not going to provide fair market compensation.
I'm surprised, when we've listened to what this government has said about the fact that they expect the federal government to compensate British Columbians for land claims settlements, and when we've heard all
[ Page 1811 ]
of the brave talk about how this government believes, as did the former government, in the responsibilities that the federal government has for the settlement of land claims. If you really expect the federal government to provide the compensation and if you really expect, as you said, these land claims settlements to result in an inflow of cash from Ottawa to British Columbia, why on earth would you want to undermine a system of compensation based on fair market value?
I absolutely can't understand it, unless another part of the hidden agenda over there is that in fact the Premier, the Attorney General and the Minister of Aboriginal Affairs don't expect Ottawa to provide compensation. If you plan to settle land claims and create parks without getting any compensation from Ottawa, then it would make more sense to steal these tenures away from the people who have a legal right to them. But if you're going to look to Ottawa for compensation, then I don't understand why you would want to abandon the notion of fair market value.
We tried to establish the Moresby Park on the basis of fair compensation, and that was a less than satisfactory experience based on fair market value. Why would you want to set your sights even lower? Clearly you do want to set the sights lower. You clearly intend to pay something less -- and I suspect significantly less -- than the market value for tenure. That is going to be bad news for the economy of British Columbia.
It may be a short-term fix for the treasury, but it will be a long-term disaster for the people of British Columbia who work in the resource industries, and eventually for all British Columbians. I would urge you to withdraw, modify, or at least tell us what the true intent of this legislation is.
G. Wilson: I rise to speak against this bill and would like to comment briefly on only two aspects of a bill that does not really address many aspects of the concerns, some of which we've already heard in this debate.
Before I do that, however, I would like to come back to a comment that was made in the speech by the member for Okanagan-Penticton, who suggested that somehow the Liberals were all over the map philosophically. That depends entirely upon which map we are looking at. If it's the philosophical map of this current government, it is clear that we're not even on it, because we believe, and I think most British Columbians believe, that there needs to be not only a question of fairness applied but some form of regulating that fairness. The best way to do that is to allow the society itself, through the market principles, to drive what is in fact fair, equitable and honest.
I would point out that the latter remarks made by the leader of the third party are very pertinent indeed, and I hope that this government heeds some of the concerns that were expressed by him. I would like to expand a little bit in the comments I would make. I would therefore make sure that my remarks are directed quite specifically to the matter of what we are about to face, hopefully, if indeed this government is true to its word with respect to the resolution of outstanding land claims in the province of British Columbia.
It makes no sense at all -- none whatsoever -- for this government, when they are about to enter into negotiation on the process of a successful resolution to land claims, to put any impediment into the negotiation process for the maintenance of a fair market-driven value for resources that are to be compensated, especially if the compensation that we're looking at is based upon the fiduciary obligation of the federal government with respect to past claims. It simply doesn't make any logical sense to do it that way.
Notwithstanding what the intent of this government may be -- and I believe that this government is intending to try to find a mechanism whereby they can put in place their land use proposals, some of which we can accept and agree to, some of which we think are good ideas.... But they're trying to do that without recognizing that the cost has to be established not on the basis of what is fair in the eyes of big government but what is fair, I would say, with respect to the public. The way the public determines that in a free market system -- which is what we still have in the province of British Columbia, and I hope we never lose it -- is a fair market value that is driven largely by the market price that is out there, regulated by the economy of the day and not by what is perceived to be fair by a caucus of cabinet ministers or by a special cabinet committee or by whatever other structure in the eventual regulation of such a bill is to determine the fair market value of this compensation.
[3:30]
When we are starting to look at the proposition of settling land claims, it is absolutely essential that all parties -- not just aboriginal people, provincial government and the federal government, but all parties, including those people who have third-party investment and third-party interest in the province of British Columbia -- have confidence that the decisions being taken through negotiation have some substance with respect to what is real in the market and not just what is real in the minds of the people negotiating.
I would have to say that as we start to look at the proposition of the resolution of this question, to which this bill may very well be applicable or may very well be a driving principle as part of whatever negotiation process this government eventually enters into.... If those who have substantial investments do not have the confidence that the eventual compensation provided is in fact an accurate representation of what the market will provide, then can this government tell us the extent to which they will have confidence in terms of their potential reinvestment or future investment as we start to look at the overall development of our industries, both in terms of primary extractive renewable and non-renewable industries in the mining sector.
We recognize what the government is attempting to do here. We're not chastising the government for its effort. We're not simply trying to be obstructionist or trying to tell the government that what they have put in place here is, in fact, something that does not have some value in principle. What we are saying is that if we are to amend the land-use situation in British Columbia, if
[ Page 1812 ]
we are to move forward for the development of parks as a percentage of whatever that may be -- whether it's what this government says or what this caucus may argue for, or whatever the Stephen Owen commission might recommend in a final analysis.... If we are to take those positive steps -- and I believe they are positive steps -- then we have to make sure that we have all partners in this economy on side, and that we have adequately discussed, consulted and agreed with all parties how we are to proceed forward to make those positive changes.
If indeed what is meant by fair compensation is such a consultative process -- a process that opens the door to that kind of consultation and direction -- then we as a caucus would applaud that. We would say that finally there is a proposition put forward that would suggest that we have a mechanism to be able to advance the debate with some reasonable, rational set of parameters around which the debate can take place, recognizing that there is adequate compensation where people have lost investment.
The difficulty that we run into is that if this legislation does not have a mechanism that removes the discretion solely and simply from government, there can be no confidence that that compensation which will be eventually agreed to will have any relevance whatever to the realities of the market price of the day. That is what we are saying.
Interjection.
G. Wilson: We hear from the Minister of Transportation, through interjection, that the market is not necessarily fair. There can be no more fair way of establishing price on a purchase or sale mechanism in terms of the development of this particular instance. I hear from the minister opposite responsible for this legislation that, indeed, where in fact the fair market value may be in place, such as the Strathcona question.... In fact, market price has a two-edged sword attached to it. On days when the market value through investment potential will provide revenue and revenue returned, it should be paid. In those instances where market prices are driven down, those kinds of compensations will not. That is what free enterprise is all about. It allows the price to be established and driven by those people who are essentially willing buyers, and it will provide a price to a willing seller. We believe that is in fact available and should be available on the free market system.
We do not oppose Bill 32 simply because we wish to be obstructionist, or because we simply think this is another one of the NDP's fly-by-night schemes to try to defraud the people of British Columbia or defrock the free enterprise system. We oppose this bill because it is fundamentally flawed, and because it is the wrong way to go. We would suggest....
Interjection.
G. Wilson: I hear an interjection from the member for Okanagan-Penticton that they have heard that their legislation is fundamentally flawed over and over again. If that is repetitious, it's because they constantly table documents in this House that are fundamentally flawed. When they get it right, we won't have to keep telling them they don't have it right.
What is necessary here is a simple process that would amend this legislation to put in place a mechanism that recognizes that free market values will trigger the compensation paid to those people who lose their investment as a result of government action. It's that simple.
J. Beattie: Fair!
G. Wilson: I hear this banter of "fair" from the opposite side. The last time we heard members opposite talk about fair, they talked about fair wage. They said that fair wage was something that was fair. We have some doubt about the proposition of fair. If you look at it in the definition of fair wage, quite clearly it is anything but fair. If you compare it to public sector workers in the health care industry that can't even get gender equity in their provision -- when they were going to give a fair wage to people involved in the construction industry of anywhere from $19 up to $27 an hour -- that's not fair. We know that when they talk about fair wage on the opposite side, it's the same as when they talk about fair compensation. It isn't fair to anybody except those members of government who believe that what it does is drive the agenda of government. We don't think that this province needs big intrusive government that puts itself in a position through this kind of legislation to remove the rights of those who have investment in British Columbia.
We have witnessed the high-handed action of this government, which we have spoken out against. It has been alluded to once before in this debate with respect to the manner by which this government has dealt with doctors in this province. Notwithstanding whether you think their agreement is good or bad or fair or not fair, the fact is that once again this word "fair" becomes a part of this debate, because the members opposite insist that it is fair to arbitrarily roll back, disallow a legally negotiated agreement because they don't happen to think it fits their agenda. Yet when that was done by a previous government in Bill 82 to teachers, that was considered to be inherently unfair by members opposite. How is it possible for us to stand with any confidence in British Columbia and suggest that this government has a clear and distinct understanding of what is fair when there is such a contradiction in terms by those who would argue that it is fair to arbitrarily break a contract that is signed by doctors, but it is not fair for a previous government to have arbitrarily broken a contract made with teachers? Here we have an argument....
Interjection.
G. Wilson: We have the Minister of Transportation saying that it was unfair, because it was an unfair contract. Who determines that? Who determines what's a fair or unfair contract -- the two willing partners who came together and signed it? Or is it the government
[ Page 1813 ]
who decides that it's fair if it fits their agenda? If it doesn't fit their agenda, then it's inherently unfair.
The reason why this document, Bill 32, is not going to be accepted by the people of British Columbia -- whether they are in the mining sector, the forestry sector or the public at large -- is because this electorate has come to recognize that they cannot trust the word of this government. When they have seen and heard this government talk about fair taxation, they've seen quite the opposite. When they have heard this government talk about fair negotiation and compensation with doctors, they have seen the opposite. When they have heard this government talk about the introduction of fair wage, they have heard that it's anything but fair. And now when they hear them talk about fair compensation, they know that they can no more trust the definition of "fair" in that regard than they can in any other measure they have seen in this Legislature with this new government to date.
In closing, let me come back to my first point. Let me suggest that -- and I offer this in all sincerity to the minister opposite, and I hope the minister will take my comments in the spirit in which they are offered -- that the biggest problem with this bill, and I would hope the minister might want to consider this as a potential for amendment, is what it is going to signal with respect to the proper compensation for third-party interests in the eventual conclusion of aboriginal land negotiation, especially in those areas where there is a large component of value-added investment as a result of potential mineral extraction or forestry activity.
We cannot introduce legislation that will essentially put into the hands of one of the bargaining parties enough powers to be able to arbitrarily move away from a compensation that is adjusted by fair market-driven value, because anything short of that -- and I offer this in all sincerity to the minister -- is going to be seen as a position quite contradictory to the one that the government must argue with respect to fair compensation for past lands lost in the final resolution on the question of aboriginal land title.
How are we going to finalize a price, a value, on past lands alienated as a result of the Indian Act and through the DIA and past activities of the federal government if it isn't going to be driven by market value? How is that market value going to be determined? It is universally accepted that not only will it be determined on the basis of the resource wealth, but it will be measured on the basis of revenue lost through past exploitation of those lands.
That is generally accepted, so how is it possible -- and I offer this question and hope that the minister will give some consideration to it -- for us to argue for the resource companies in British Columbia that they be treated in a different manner than the way we are finally going to have to come up with a cost to resolve the matters of the aboriginal land question, regardless of whether that fiduciary responsibility lies with the feds, and they pick up the price, or whether or not the province is going to have to pick up a proportion of the past claim?
The second half of that problem -- I signal this as a potential problem, and hope that this minister will consult with the Minister of Aboriginal Affairs to get verification of what I'm saying -- is that an eventual resolution to this question, and the only way we're going to get a satisfactory solution, will be through some form of joint stewardship of the resource wealth itself. In that proposition there has to be protection for third-party rights and interests, or we will not have an equitable, just and acceptable settlement in British Columbia.
I cannot say with certainty whether or not this piece of legislation will drive companies out of the province, because I don't really know if it will or not. My suspicion is that it might. I can't say with certainty whether or not this legislation is likely to create a great deal of disinvestment or loss of potential, because I really don't know. My suspicion is that it will. Those members of my caucus who have addressed this question argue that in fact it will, because there is evidence to support their claim. But we cannot say with certainty that that will be the case.
[3:45]
What we can say with certainty -- and what I hope this minister will hear -- is that if there is not a fair market-driven compensation value for the lost revenues and potential revenues through investments by the resource sector in this province, it will make the negotiation and final resolution on the aboriginal land question much more difficult to obtain. It is that simple. Therefore I suggest that if this legislation is at all necessary, there be some consideration to allow for a market-driven price to be a mechanism that will be the functional price that will come up and eventually be the final resolution of this question.
We are going to vote against this bill because we believe in principle that it is the wrong way to go. We believe that this bill undermines the rights of one sector of our economy. We believe that what the government is attempting to do has some basis of honour in its attempt to try to change the land use pattern in British Columbia. That we can accept. But what we cannot accept is that they would introduce legislation that will arbitrarily remove the right of those people who have investments in British Columbia to be paid fair market value for their investments. That is what this bill does.
In making sure that this bill is adequately and properly debated, we have talked about all aspects of it. We have made positive suggestions as to how it could be and should be amended, if indeed it must proceed. We have offered these suggestions in a manner that I believe is fitting of an opposition that is trying to be constructive and positive and provide direction to government. We have a constituency that needs to be heard.
In looking at this bill on second reading -- if it is to be advanced through second reading; if we cannot have it hoisted now and taken out -- I hope that as we get into committee stage, there will be a serious attempt made by members of executive council and private members opposite to amend this legislation so that it will not arbitrarily remove the rights of those people who are investing in the rights of the province.
We cannot support this bill. Our caucus will unanimously oppose it.
[ Page 1814 ]
U. Dosanjh: The Leader of the Opposition talked about what's fair compensation, and so has the leader of the third party. In my most humble submission, these two members have made a fundamental mistake. Their argument is fundamentally flawed, using their term. A resources compensation commission has been established. The commission is going to make recommendations on both the process and the principles for determining compensation. At the end of that commission's report, when the government adopts or rejects any of those recommendations, then these members can legitimately stand up and say whether the compensation being awarded is fair or unfair. Therefore the argument that they have made so far, and on which they have wasted the assembly's time for the last many hours, is premature. I stand tall, contrary to what some might say.
Let me say that I heard the leader of the third party say that this is the third time that this government has allegedly taken away people's rights. He is wrong. This government is following the mandate that the people of British Columbia have granted it. On the issue of golf courses, our party made it abundantly clear to the people of British Columbia what it would do when it was in power. We have done exactly that. We have protected and attempted to protect the agricultural land reserve for future generations of British Columbians. On the doctors' pension, our party stood firm on the promise it made to the people of British Columbia that a fully funded pension scheme, negotiated by the former Premier in his dying political days, would be rendered null and void. We have done that and have lived up to the promises that we've made. So it's not fair for some of these members to stand up and say that we've done something that we didn't pledge to do.
On the issue of the Resource Compensation Interim Measures Act, if these people did their research properly and went back into the legislation, they would see that Bill M236 was introduced in 1990 by the member who is presently the Minister for Environment, Lands and Parks. That bill indicated that we need a process in British Columbia to fairly determine the quantum of compensation and the principles that should govern the determination of that for these kinds of issues. I don't think anyone can say that what we're trying to do now is something that we didn't say we would do.
Having put that argument to rest, hon. Speaker, let me now go to some of the arguments made this morning by my good friend the member for Richmond-Steveston. He was talking about property rights...
Interjection.
U. Dosanjh: ...John Stuart Mill and Marx, of course -- many of them my favourite philosophers.
Interjections.
U. Dosanjh: Oh, particularly. I learned a lot from Marx, as well as others.
He quoted Mill and Plato. Perhaps members of the opposition don't realize that in his dying days Mill believed that socialism was the cure for many of society's ills. Let me read two quotations from the Encyclopedia of Philosophy for your use:
"He believed in democratic government, but he was convinced that it could not work well unless the citizens who lived under it were reasonably well educated, tolerant of opposing views and willing to sacrifice some of their immediate interests for the good of the society."
On economic theory, the encyclopedia says that this is what Mill believed in:
"With regard to economic theory, Mill at first supported a general policy of laissez-faire, but increasing awareness of the uselessness to the individual of political freedom without economic security and opportunity lead him to re-examine his objections to socialism. By the end of his life he had come to think that as far as economic theory was concerned, socialism was acceptable."
Hon. Speaker, what we're trying to do is much less than socialism. With Bill 32 we're trying to put in place a process and principles that would eventually bring certainty to the land claims process and to the issue of compensation for parks that have to be set aside. The opposition Liberals, of course, agree with us that we have to increase the land area set aside for parks and preservation to 12 percent, but then they go on and say that we shouldn't have a process in place. I can't understand why they would say that we should have it, yet not work towards bringing some stability, certainty and finality to the issue of process and principles that govern compensation, to set aside the land that we need to set aside.
It has been argued, of course, that by bringing in Bill 32, we are threatening the tenure and taking it away from owners of mineral rights and others. Nothing could be further from the truth. If the members opposite would take the time to read the provisions of the bill and try to understand them -- they are in plain language, because we as government have made it our policy to formulate laws in plain language so that everyone, including the opposition, can read and understand them -- they would know that all this bill is doing is saying that we will hold in abeyance some of these issues, including the determination of compensation for some of those rights, until we have a firm process and principles in place. Whether those principles will be fair or unfair is something that can be reviewed and talked about.
I can assure you that the intent of our government is to have a fair process for small and family-owned rights as well as for the major industrial owners of these rights. The process has to be fair, less litigious, less expensive and more certain. We are attempting to do all of that by bringing in this legislation.
The argument is: when we bring in this bill, which simply holds in abeyance some of those rights for a certain period.... Don't tell me we don't know the principle of holding certain things in abeyance. There is no absolute freedom in this world. If you talk about private property, don't pay taxes on your home for the next two or three years and see who owns that property. There is no absolute right; there has never been an absolute right to hold property. If I own a lot in Vancouver and want to build my own home, I have to live by the rules and regulations imposed upon me by
[ Page 1815 ]
the city. There is no such thing as absolute freedom. What we're trying to do here is to hold those legal rights in abeyance until we have a fair process for determining compensation on those issues.
The argument has been made by the leader of the third party that investment is going to fly away or that it is not going to come into this province as a result of this particular bill, which is simply holding certain rights in abeyance for a short period of time. The argument has been made by the leader of the official opposition that somehow that is going to happen; he agreed with the leader of the third party.
Nothing could be further from the truth. The logical result of certainty and fairness as well as a process and principles to determine the quantum of compensation awarded for these rights would be that entrepreneurs would want to come into the province, where they know what they're going to get, where they know they're not going to have to spend thousands of dollars through teams of lawyers -- enriching the lawyers -- and where they know they will not have to spend hours of their time and thousands of their dollars trying to argue for fair compensation. They would know beforehand what the principles would be to determine that compensation.
Anyone who understands those issues would not stand up here and say that they dislike the bill. Obviously the opposition hasn't taken the time to read the bill and to understand what the bill is trying to do. Obviously they still belong in the Middle Ages in many ways. Perhaps at the end of 60 years, they might realize that the world is moving forward, because the world wants to preserve for itself some of the natural resources that legitimately belong to the future generations and that we are temporarily borrowing from our future generations. If we don't make those efforts to preserve those resources and to bring about a certain degree of certainty to the processes that deal with some of those rights.... If they don't understand that, it's really disappointing. Nothing can be done to redeem some of these people's ideas.
[4:00]
However, there's another argument that my hon. friend from Richmond-Steveston made this morning, and that was more interesting. He said we need to have stability in property, so that people would owe allegiance to the system of government. That's fine. If we define allegiance simply based on property, then perhaps millions of tenants in British Columbia should owe no allegiance to this system of government. That argument, my friends, is completely fallacious and completely false. People owe allegiance to a system of government that is fair, just and open and to a government that is run with a certain degree of integrity. All of those things and all of those elements of fairness, openness, honesty and integrity are enshrined in this bill. It says that we want to have a commission go around and make a report to us based on their findings; obviously certain further steps will be taken. That's what this bill says. This bill doesn't say that we take away the tenure. This bill doesn't say that we take away people's private property. This bill doesn't say that we somehow dispossess British Columbians of their natural and fundamental rights. The Liberal opposition and third party are still living in the Middle Ages. They don't realize that the New Democrats have moved forward. We are much farther ahead, of course. We've moved forward, and we want to deal with the issues that are going to impact on the lives of British Columbians for years to come, whereas these people are stuck at Adam Smith, and they don't want to move forward.
J. Tyabji: The former speaker was talking about a bill that simply holds the industry in abeyance until they have a chance to study it. Hon. Speaker, I would put to you that this is one of the fundamental problems with the government. They lack an understanding of how businesses operate and of the fact that businesses cannot be held in abeyance for 18 months on something as critical as property rights. You can't just simply put it on hold.
The former speaker referred to purchasing a house and all the technicalities of the laws you have to go through before you build it. The hon. member doesn't understand that when you are talking about generating revenue, there's a difference between generating revenue through a business and building a house, and between the kinds of laws that apply to each of them. This is one of the problems we have with the government right now. None of them are from a business background. They don't understand how business operates, and they fundamentally can't understand free enterprise. I would have to say that they are naive in the extreme if they think that they can simply hold an entire industry in abeyance for 18 months and pick up where they left off 18 months earlier.
This bill is going to be the last nail in the coffin for the mining industry. The mining and forestry industries are having great difficulties. Already we have seen the economy grinding to a halt under this government's legislation. We have other legislation coming forward later that will even further wrap red tape around some of the industries trying to do business with the rules as they existed. There were certain rules of the game when these businesses went into business. They abided by the rules; they went into business according to the rules as they saw them. Now we have yet another dangerous precedent, very similar to the one we saw with the moratorium on golf courses, where free enterprise businesses have gone forward in good faith with the existing rules, and the rules have been changed underneath them. Now we have legislation that's going to be retroactively damaging to these businesses and to all these industries.
There's been a lack of consultation. All along we heard "open, honest government" from the government. There has been absolutely no real consultation with the two industries as to what kind of impact this kind of bill will have on them. This Big Brother mentality is coming out. We have this sort of Orwellian nightmare developing in terms of the legislation that we're seeing come before the House. We see again and again this government putting forward legislation that's going to ruin free enterprise initiative in the province. We're going to see people move across the
[ Page 1816 ]
border; we'll see overseas companies not investing in the province.
I don't know where we're going to get the 3 percent growth that the Finance minister projected in the budget speech, because we had a suffering economy to begin with. What we've seen is the budget -- the priorities in the budget, for example.... They've cut every revenue-generating ministry they have; they've increased the money that's going to the non-revenue-generating ministries. I would say they don't understand that you can't pay taxes unless you're earning money. If you don't have a paycheque, you can't pay taxes. It's not enough to know how to milk the cow; you have to know how to feed the cow. That's something that they just don't understand on that side of the House. They know how to take the taxes out of the system, but they don't how to generate the taxes in the first place.
This bill is going to see a further disintegration of the free enterprise base in the province. We're not going to have any taxes. I would wonder how on earth we're going to have a budget next year that allows for any kind of spending, because there won't be any taxes to be paid if people are out of work. We're going to hit two industries through this bill that have a major impact here. We've seen so much of the legislation that's coming forward.... Hon. Speaker, because we consult and we listen to people in the industry, our days on the opposition side are taken up with meetings with all the people affected by the legislation being brought forward by the Big Brother government we have in the House right now.
I would say that the reason the rules are changing beneath the industry's feet, the reason they're changing the rules of the game as they're in the process of trying to make a living in B.C., is that there's a hidden agenda here on the part of this government. The hidden agenda, of course, should be something that was very obvious to us during the election campaign. They've tried to couch their hidden agenda in terms like "open and honest government." Of course, we had: "No special deals to insiders." We saw that one go by the wayside.
We've had this so-called fair wages...an absolute outrage for any of us who support any kind of affirmative action, because you've got fair wages.... What is this? Affirmative action for construction workers? What kind of priorities does this government have that they're putting money into something like a fair wages policy. Here we have something that has to do with the mining industry, and they're actually ruining the ability of the mining and forest industries to understand the rules of the game as they exist. They just don't understand how business operates. That is fundamental to what's wrong with this government.
The hidden agenda to which I referred is the fact that -- as we should have known from the beginning -- this government has a socialist agenda. They would like to remove property rights. In fact, we know that 20 years ago the current Attorney General was the one saying that he looked forward to the day when property rights are irrelevant. Here we are, looking at a bill brought forward that goes to the heart of what property rights are. Do we want property rights? On this side of the House, we do. We like the idea of having businesses that can operate relatively unfettered. We like the idea of a healthy economy so that if you do have to have a social safety net -- which we support -- you will have it by having the taxes generated by a healthy economy. This government sees business as irrelevant to doing government in the province.
I have to ask them: how are they going to manage when there's no more money being generated, when the economy has ground to a halt, when they've taken away property rights from two of the most important industries in the province, when they've lost investor confidence in the province, when we've had the job losses that are going to be coming up following the legislation that we may be addressing this evening with Bill 29? What is this government going to do when there is no economy to support the expensive social network that we need? What is this government going to do, because they don't understand that we need investment to produce a strong economy from which we can then take some measure of taxes -- not the measure that this government proposes, but enough to support an adequate social safety net?
I would put to this House that what we got in the last campaign were a lot of very wishy-washy campaign promises that did not indicate the socialist agenda that they have brought forward.
G. Farrell-Collins: They've broken every one of them.
J. Tyabji: And they have broken every one of those campaign promises, because they are now revealing their real agenda and what they really plan to do. We can go back to the Attorney General's comments that he hopes property rights will be a thing of the past. Now we see it come out that property rights are irrelevant to this government, that the economy is irrelevant. The economy is just a by-product of something that they see as free enterprise. They don't understand it so they can't allow for it. They don't understand how free enterprise works; they don't understand the impact that these kinds of bills will have so they don't allow for it. What are we going to do when we have the kind of situation that's going to develop out of this, where we have no investor confidence, when we have no new businesses opening, when the mining industry is finished in the province? If you talk to people in the Mining Association, they will tell you. The Mining Association represents a consortium of mining interests. Those people will tell you that based on the direction this government has set through their legislation, through the kind of indication they've been getting through the ministry, the mining industry could be finished in B.C.
I would put to you that we have a hung cabinet here -- perhaps one that should be. We have a cabinet here where we have the green caucus versus the labour caucus, and they cannot agree on things; therefore we have a lack of decisions being made, we have committees being appointed, we have energy councils coming aboard. We have all these things where the ministers
[ Page 1817 ]
aren't making decisions: it's being appointed to some committee somewhere else. The ministers are almost irrelevant in some of the portfolios. In the meantime, both the environment and the economy are suffering.
In fact, the problem that we have here.... We have seen this in other countries. When the economy is poor, the environment suffers -- and that's the bottom line. As the Environment critic, I want to see a healthy economy, because you cannot have a healthy environment without a healthy economy. That's something that this government doesn't understand.
They think it's enough to bring in legislation that ties the hands of those who are doing things that perhaps they don't like. All you have to do is consult with them -- sit down with industry -- and go along the lines of what you said during the election campaign, and that was open and honest government. If you consult with them and work out a plan between all the affected groups, you'll be much more successful than coming out with bills that affect them and not making any provision for the aftermath of what you're introducing.
There's a really big problem with regard to the environment: if there is no investor confidence.... I'd say that with the corporate capital tax, the golf course moratorium, this bill and Bill 29, which is the amendment of the Waste Management Act, we are going to have such a lack of investor confidence that no businesses are going to want to invest in their companies to be more environmentally responsible, because they are not sure what legislation this government is going to introduce tomorrow that will be retroactive to something they might have done last month that will affect them. We will see capital investment flowing out of the province, because there will be almost nothing left from the legislation, the increase of taxation and all the other influences this government is bringing to bear on consumers and business people of the province. The economy is just going to grind to a halt.
I would urge the government to reconsider the legislation that we see on the table for today's discussion, particularly this legislation and Bill 29. They're not going to work. If this government really is trying to hold to some of their election campaign promises and does not have a socialist agenda, withdraw the bill. This bill is definitely an infringement of our property rights. This bill is definitely the product of a socialist agenda. If you are committed to free enterprise, you will consult with businesses and industry, and you will have some consideration for the workers who are going to be affected by this and will probably be laid off because you held this in abeyance. They're being put on hold for 18 months. At the end of that 18 months, we'll be worse off than we are now. By the time they have the designated committee coming forward with whatever recommendations -- of course, the minister isn't making the decisions here; it's some committee that's being appointed somewhere -- there will be very little left of the two industries affected that they can possibly even talk to.
You can talk to people in the mining industry, and they'll tell you. The mining industry will be finished in B.C. if we continue in this direction. They're really affected by this. The international mining community is watching this House to see what kinds of decisions we're making, and they're not happy with them. The mining industry is what affects the workers in many of the ridings on that side of the House and certainly the workers in some of our ridings. But more so, some of these NDP members should really be upset about this bill. We are going to call for a recorded vote on this, because we want to send copies of Hansard to the workers in their communities to show them that their member voted in favour of this bill. The people working in their communities who are losing their jobs can read how their elected representative voted in favour of bills that will cost them their jobs. They can read and weep.
In the next election, I can tell you, the people of B.C. are going to realize, even if they have nice platitudes and a lot of wonderful election rhetoric, that the hidden agenda that has come out now -- the Big Brother agenda that is bringing us into this brave new world.... We'll have to be very brave in this new world of this kind of legislation, where we have retroactive legislation taking away property rights. The next election is going to see a very different mood in B.C. They will not be quite so trusting of a government that is committed to this kind of socialist legislation.
I would like to introduce an amendment to the bill: that the motion for second reading of Bill 32, the Resource Compensation Interim Measures Act, be amended by deleting all the words after the word "that" and substituting therefor the following: "Bill 32 not be read a second time now for the following reason: namely, that the bill fails to provide compensation for those parties that are affected by the bill."
[4:15]
U. Dosanjh: I rise to ask leave to make an introduction.
Leave granted.
U. Dosanjh: I have the pleasure of standing for the member for Mission-Kent. I would ask the House to join me in welcoming 50 grade 7 students from the Hatzic Elementary School and Mr. J. Mills.
On the amendment.
R. Neufeld: I rise to speak to the amendment on Bill 32, and to Bill 32. It should come as no surprise to the members who are left in the House on the opposite side that I am in opposition to Bill 32. I support the amendment.
This government has only been in government for about six or seven months, and they have already alienated most of the investment community -- our industries and our corporations -- that we so heavily depend on for jobs. It's distressing to me to have to constantly stand up and speak to every bill that comes forward, because it is negative toward investment in the province, especially since for so many years British Columbia has been hospitable to investment. That's because the administration of the day knew we had to have investment, whether it was offshore, Canadian or companies and corporations within British Columbia.
[ Page 1818 ]
We knew we had to have those jobs, those corporations paying taxes and those people working, so that the services we enjoy today could continue.
It's obvious that the NDP government is bound and determined that it does not take jobs, other than those in the public sector, to maintain an economy. I don't know how, if we don't have private investment -- earnings from our timber and our minerals coming into the provincial coffers -- we're going to afford to continue to employ people in the public sector. Mr. Speaker, if you go back in the budget, you will find that there were 1,500 FTEs -- full-time employees -- for this year; that's about four a day every day of the year that this government plans to hire. You would think that they would have thought there is some way they have to raise the money. Somehow there has to be taxation coming in to pay for those people in the public sector.
Obviously those thoughts have gone by the wayside. This is another bill that has come forward along with other bills that have all been very negative toward investment in the province of British Columbia. Obviously it's designed to fulfil a few of the promises that were made by the NDP during the campaign. One of them was to double the parks in the province of British Columbia. We all like parks, and where I live in northern B.C., we have a number of parks. They are beautiful parks, and I love them just as much as anyone else does. I want to maintain as much parkland as possible for now and for future generations. But, hon. Speaker, I'm also aware enough to know that we cannot make British Columbia all parkland and continue to survive. Unfortunately, we find that in many cases what we want to turn into parkland turns out to be some of the most valuable land for mineral and timber resources. I understand that there has to be a balance, and that we have to maintain some of the old growth and some of the parks. We have to maybe enlarge some of them, because our population will increase. We are, after all, the stewards of this land just for the time that we live on it. But we have to remember that we have to look after the generations to come; I understand that. The process of setting aside for 15 to 18 months any way for corporations to know what kind of compensation they will receive if some of their mineral or forest tenures are removed because there happens to be a park going in there causes an awful lot of turmoil in the corporate world. They don't know whether they should continue to invest for those 18 months, stay stagnant or maybe just withdraw.
The other day the member for Prince George-Omineca stated in the House that he knew specifically of one corporation that was pulling out some $60 million of investment in British Columbia -- maybe not specifically because of Bill 32 -- because of a number of bills like Bill 32 that were not hospitable to business and industry. We also know that the reason for this bill and the delay has something to do with land claims. The government told the people that they are going to settle land claims and settle them fairly quickly. That's very obvious. What's also very obvious to these corporations that are caught in the position of having tenure and maybe having it removed is that they may not receive fair market value for that specific tenure.
That is not the way British Columbia grew to be the great province it is today, the province that over the last three years created almost half of the jobs that were created in Canada. That wasn't accomplished by stopping growth in the economy or by introducing bills that make investors go away or make the province inhospitable for investors. That was accomplished by governments and a philosophy that encouraged growth in the natural resource sector. We know that this province enjoys some of the best social services in all of Canada simply because of all the money that flows into our coffers from all of the people who work in those areas and all the revenue generated there. It's rather stagnant today, and I don't think all of it is strictly because of the world market. A lot of it is because a lot of these corporations feel that this province, now in its seventh month of an NDP government, is rather hostile to investment, to corporations. That's evident.
When the member for Peace River South stood up and spoke, he talked a bit about corporations and the jobs they provide for British Columbia, which we all enjoy. Corporations don't feel welcome in British Columbia today because of the NDP government. There were members on that side of the House who were clapping their hands, saying: "We should tax them more." What kind of an example is that? What does that show to the business world in British Columbia? It shows that we have a government over there that is cold-hearted to that part of the economy and that they tend to say that they're going to look after the wage-earners, who they represent. Well, I tell you, when you start kicking out of the province the corporations that provide the jobs for these people, I don't know how you can stand up in front of everyone and say that you're looking after the people.
The members opposite in the government, when they stand up and talk about the corporations, continually talk about the fat-cat corporations making all the money, taking it out of the country and not putting anything back in. It's a little unfair to say that. I'm not saying that some money doesn't leave British Columbia or Canada, but that's the capital system that we live in.
[The Speaker in the chair.]
Those corporations and companies that have tenure for forest and mineral licences are mostly public companies, and the shares are owned by different people all over British Columbia and all over our country. If those corporations and companies don't return a profit, those shareholders will not maintain their shares. And when they start selling their shares, because they don't have any faith in the corporations anymore, we know what happens to the corporations.
It's also quite noticeable that not many government members stand up and speak completely in favour of this bill. The member for Vancouver-Kensington did, and I respect him for it. He obviously feels very strongly, because he talked mostly about why he thought it was a good bill. It seems as though all that many of the other members can do is rise and ridicule the Social Credit and Liberal opposition. Obviously they don't have it in their hearts, or they haven't been
[ Page 1819 ]
coached enough in the caucus room to know what to say when they come out here.
The member for Vancouver-Kensington spoke a little bit about socialism, and I find it interesting. He talked about Marx, socialism and those types of things. I don't usually get into that philosophy, but it brought my mind to looking around the world. I think to myself, I don't know why I should be too concerned about socialism; they're doing pretty good. But I look at the USSR, Sweden and New Zealand, and I see countries asking a capitalist system to come in and rebuild their economies -- countries that believed in socialism and Marx. And that's where they are. So I don't really know why we should be worried so much about socialism, because those countries are obviously doing quite well. But I think when we really seriously look at those countries and see what's happened to them, we should think very carefully before we talk about Marx and socialism.
[4:30]
What will happen if these corporations aren't given fair value for their tenure? The small resource communities across British Columbia -- there are a number of them in my constituency, and I know that a lot of the NDP government members opposite are not aware of what happens just a little way out of Vancouver, but there is the greater part of the province of British Columbia out there -- depend very heavily on forest tenures and mineral tenures. Those are the towns and the cities that are going to feel the results of this type of legislation when those companies decide not to reinvest in their tenures because they're not sure what they're going to receive for it. In fact, they may reinvest back into it even if they know it's going to be expropriated. But if it's not at a fair market value, then of course they're going to say: "What are our shareholders going to say to us if we reinvest large dollars in this and are not going to get them back out?" Those are the communities, the parts of British Columbia, that are going to feel the effect of this.
Maybe it's fitting that this government just recently introduced Bill 11, the Natural Resource Community Fund Act, to look after small communities such as Cassiar that were in need if mines or forest companies closed down their operations. Maybe that's one of the reasons the bill was introduced, because this government knows and its hidden agenda was that as it brings out more bills like Bill 32, the Resource Compensation Interim Measures Act, the Corporation Capital Tax Act and all the other ones that go along with it, there are going to be repercussions out there -- and some drastic repercussions. They thought they had better get into line and make sure that they had something in place to look after all those communities.
Maybe it's the reason they increased social service spending so drastically this year -- because they know, they feel or have a premonition that something could happen when a lot of these corporations quit investing in those small communities and even larger ones in the rest of British Columbia.
Some of that is very scary, and this government should know that. They're going through the experience right now with Cassiar and the people up there, and how upset they are over what's happening with the closure of their mine. You would think that the government of the day would have a little bit more room in its heart to say: "We don't want to encourage corporations to quit investing in British Columbia. We don't want to encourage further closures, because it's expensive for us." I think Cassiar is probably going to cost in the neighbourhood of $20 million. That's an awful lot of money. As a province, we can't afford too many more of those.
When they come off the workforce, we know that those people will very likely return to the lower mainland, to Vancouver, and we'll have to retrain them and pay for that. They may have to go on unemployment insurance or on social services. That's not a comforting thing to look forward to. The corporations, of course, look at it the same way. If they can't make a dollar, they're not going to reinvest.
We talk about investment stats, and it's so easy to say that investment is leaving British Columbia, but we have no really hard figures on that, other than the one that was mentioned the other day by the member for Prince George-Omineca. That was $60 million destined for British Columbia investment, and it's not going to be invested in British Columbia. That's an awful lot of money, and we wonder how many jobs and what kind of a spinoff that would have created. It's hard to stand up and say that there are all kinds of investment leaving, because maybe it's not so. There are a lot of corporations that may not tell us what they're doing.
The other day one of the opposition members talked about corporations which may move their money, expertise and mining capabilities to Chile. I want to go on record too -- and I have been on record -- as saying that I think those corporations would much rather invest their money in British Columbia and Canada than in Chile. If they want to go to Chile only to take advantage of a really low labour market and something to that effect, then I have no truck with that at all. I don't believe in that. But if we can continue to make British Columbia hospitable for those same corporations to stay here, we'll all be a lot better off.
I think that if you go and talk to all of them, 99 percent would much rather be investing their money in Canada and British Columbia. But the climate has to be here, and the climate is obviously not here. It hasn't been here for the last seven months, and specifically since the House was called in mid-March, and a little bit later than that, when the bills started coming through. On the order paper -- I don't have the exact amount -- I believe there are something like 39 or 40 bills. Out of those bills there are about 20, or maybe a little better than 20, that affect the business world. There are tax increases, fee increases, compensation bills, capital tax increases, so on and so forth, and it just continues. Over half the bills presented by this government affect corporations and business -- small business -- directly. That's why British Columbia is not hospitable, and that's what we have to turn around.
If we're going to continue to enjoy the services that we have today, we're going to have to turn that around. I wonder how this government feels when they've told the Vancouver Board of Trade that investment stability
[ Page 1820 ]
was its number one goal, and then they introduced over 20 bills in the past month that negatively affect corporations and businesses. I can't imagine how anyone in the government can feel comfortable with that. How could they? They are driving investment away.
I spoke a little while ago about what kind of a gauge we use to understand how much investment is leaving British Columbia. I have here some stats from the Ministry of Energy, Mines and Petroleum Resources on oil and gas dispositions. I know that this bill doesn't specifically affect that part of the economy, but it is distressing when you look to last year's comparisons, to revenue that this province has received. That is one of the gauges that we can use to determine how much investment is leaving this province, or how much investment is staying stagnant. In March of 1991 bonuses of $8.5 million -- and I'm going to round the numbers off -- came to the province. The same month, in 1992: $2.5 million. Now that should be distressing. That the government should look at very closely and say: "Yes, there's something wrong." The corporations don't feel good with us, and they are leaving.
When the member over there from, I believe, Nelson-Creston claps his hands when you talk about the corporations leaving, that's why they're leaving. We can't continue that. In April of 1991, $3.5 million came to the government; in April of 1992, $1.5 million. Again, way below. It's very distressing. In May 1991, $6 million came to British Columbia; in May of 1992, $1.8 million. Now that should pretty well set the tone, and tell the government of the day what's happening to the investment climate in British Columbia.
It's not just petroleum companies. If you read any of the mining reviews, it's much the same. It costs $46 million now to find a mineral claim. I think the mining industry has said that by the year 2000 there will be hardly any mines left in British Columbia, if we're not careful. But this government has done everything since March, since calling the House, to discourage mining in this province -- in fact, going so far as to bring back some draconian capital taxes from the 1970s.
The member for Vancouver-Kensington talked about that government living for today and for the future. I respectfully submit to you, hon. Speaker, that this government is obviously living in the 70s when they bring forward legislation tabled in the 70s that was taken out in the 80s, and that that government -- when they were in opposition -- agreed was negative and regressive taxation. Who is living 20 years ago?
We need those corporations, and we need those companies, and we need those businesses, and we need those jobs -- not just for you and me, but for everyone in British Columbia. Continually raising taxation is certainly not going to create more jobs. We have to encourage growth in the economy; you do not encourage growth in the economy by increasing taxation by drastic amounts as this government is doing.
I cannot in any way support Bill 32, and I support the amendment to Bill 32 that was tabled. I hope that this government looks very closely at some of the legislation that it's bringing forward and some of the climate that it's creating in the province for those corporations and companies, for those investors, for golf courses, for doctors. We're not creating any kind of certainty for any of those types of people to stay in the province. Whether we like them or not, we have to live with them; we have to have them if we're going to continue to enjoy what we enjoy today.
A. Warnke: This is the second time I've risen today: one time to speak on the bill itself, and once to respond to the bill. Maybe I'll get an opportunity to speak a third time, who knows? But the second time is now in favour of the amendment that has been put forward. I'd like to make some comments as to the amendment, because it is essentially designed to consider the financial interests of the parties involved here, perhaps because of the failure to protect the financial interests and the parties affected by the legislation proposed by the government.
[4:45]
When taking a look at the various financial aspects of this particular question, I examined more closely the Strathcona Park question -- let's say the issue that has supposedly stimulated this bill in the first place. A number of people have put forward the problem that the Strathcona Park question was one that was proceeding and seemed to be getting somewhere. As one writer-analyst who has been watching the Strathcona Park question summarized, there was every indication that a landmark decision was being prepared, one that would favour the government, and as a result, the Crown would not have to face the tremendous costs of expropriation.
Another analyst had put it this way: when we take a look at the various costs of what might be expended by the government as a compensation of maybe $50,000, which is a drop in the bucket.... Other figures have been tossed around, and it does beg the question as to what kind of compensation package the government here has in mind. We're not very clear. As the case proceeded -- I believe six companies were involved -- a company might put forward a view and ask for a lot of money. On the surface, it seems a lot of money that the taxpayer would have to allocate. But on the other hand, this was not really clear. As we know, in any conflict in the courts or any deliberations that take place, two parties put forward the position that they call their bottom line, but it's really a top line. Some sort of compromise comes towards the middle.
What is bothersome here -- and this is the reason I think the amendment has to be supported -- is that by interfering in this case, a case that the government might have won, and there's every indication that it would have won, the government has actually derailed any sort of future action. The compensation that may evolve now from all of this is very unclear. As I pointed out in the remarks this morning, supposedly one of the reasons for putting forth this legislation was to save the taxpayer a lot of money. But the taxpayer is one side, and as I've outlined in the last few minutes, it's not even very clear there. As I mentioned this morning, a better case has to be put forward as to just what the magnitude is of the moneys that will be saved by the taxpayer, and so forth. But there is yet another aspect
[ Page 1821 ]
that we cannot ignore. We cannot ignore the compensation to the parties who are currently seeking some sort of compensation and the failure to extend compensation as a result of the actions taken by this government.
Why rewrite? Another writer has put forward a question: why rewrite the rules? To make compensation even more favourable to the government, when it looked like there was every indication that a landmark decision was to favour the government. This invites a number of questions associated with this. It triggers many questions. When is the report of the commission expected? If we have a clear idea, which we seem to have, that the report will be coming down fairly soon, then what essentially is the rush? Why embark on a direction which would suspend compensation to these parties, whatever that compensation is? Why embark on a temporary freeze on proceedings, which might be seen as interfering or intervening in the compensation to the parties involved.
This amendment is designed in such a way as to take those questions into consideration. It addresses once again the difficulty that we on this side of the House have as to the nature of the bill itself, in coming to terms with accepting prima facie the bill that has been presented before us. As some of my predecessors have mentioned in the debate on the amendment, we have some very serious concerns because of the impact on mining, logging and the primary sectors of the economy.
[E. Barnes in the chair.]
One thing that I did not mention in my earlier remarks is perhaps the argument that had been put forward to favour this kind of legislation -- to double the park size or take in some other variables, although this did not appear in the introductory remarks by the minister. Some other analysts have pointed out that maybe we need this kind of legislation to extend what has been designated as parkland, and so forth. What we need is some legislation to address the problem of native land claims. As I reflect further on it, perhaps these are more questions which could be addressed by the minister in his summary remarks on the bill itself.
These kinds of questions also beg themselves in the amendment, because the nature of the compensation is not clear. Just how profound and expansive is the compensation to individuals? Indeed, what the impact of the compensation will be is not very clear to the people who are affected by this bill. Then when a government throws in parkland designations, native land claims and so forth, that even further obscures what the compensation package is.
Nonetheless, we recognize that if the government is going to take this particular direction, then some sort of compensation may actually be necessary for those involved. Why should they be penalized? There are some tremendous figures being tossed around. For example, to find and develop any sort of mineral deposit, the initial investment capital needed, on average, is just under $50 million. Why? A tremendous amount of money is needed in this particular area. When a government rescinds mining rights, we are dealing with some tremendous figures in terms of capital investment and, of course, what kind of impact it may have in generating economic growth and development. These are tremendous amounts.
There are six outstanding claims. I think we have dealt in this House before with the problems facing Casamiro Resources. At the outset Casamiro Resources is looking for $27 million in compensation. Although I must admit that on closer examination.... This argument has been put forward. A company such as Casamiro is looking for $27 million in compensation; the government is offering $50,000. But let us be realistic. Both figures are probably highly unrealistic. That has yet to be decided. But let it be decided through due process. Let us see what the compensation package is, and let us encourage due process to go forward. That way the investment community can feel that they will have their day in court, that they've made a fair representation, that they've received a fair hearing. However, the way the government has progressed here, due process has been suspended in dealing with all these cases. One wonders, where do we go from here? Where we go from here is an unclear picture of how compensation is to be dealt with by this government, the courts and so forth, especially since the government has decided to intervene in this particular case.
But firms, corporations, companies, small businesses -- the business community generally -- want to ensure that they've had a fair hearing, and they want to be assured that they've had some proper compensation. At least the amendment that is before us should be supported because it is right and just for those who have suddenly had their property rights suspended. Once the deliberations have fully taken place at the end of the day, those companies can at least say that if they have been treated unjustly, and there's some possibility that they can make a good case for that, at least why should they be adversely affected financially? This way, by supporting the amendment, we at least can ensure that financially speaking, we have not been unjust to these particular companies.
For that reason I rise on this particular amendment, and I fully and strongly support this amendment. I urge all throughout the House to support this amendment. There is a weakness in this legislation that halts a court action that is already before the courts. Increasingly it is becoming very clear that this is unjust; thus by restricting the due process for those already involved in the due process, they have lost something in addition to the dollars. They have lost their mining claims, logging rights. This is unjust especially since, as I reflect on it more, there's an argument that has been put forward recently that.... The report of the committee, after all, is coming down at the end of June this year. Essentially, is the argument that we need it now really valid? Could we not wait for the report of the committee at the end of June? Maybe we do need something in place immediately and as soon as possible, but I think it is incumbent on the government, as much as possible, and of course the minister arguing for the government to put forward a very strong rationale, a very strong case of why we need to embark on this so urgently. Perhaps there is a valid reason, but we want to hear it.
[ Page 1822 ]
Therefore by essentially suspending property rights -- we've elaborated on this; I've already spoken earlier on this -- then something has to be put in its place. The amendment in this particular case allows the opportunity to at least save some face to those who have invested in our economy.
[5:00]
I was also struck by one other argument, because it is not phantom people we're referring to. Michael Ziegler, president of the Real Estate Association, essentially outlined a very lengthy argument on this. Indeed, Mr. Ziegler put forward a very strong view that any sort of expropriation statutes -- and this is obviously aimed at some form of expropriation -- may actually reduce the frequency of uniform land claims, and so forth. I found this to be a very striking argument. Now we have a problem that, contrary to the idea of embarking on a strategy whereby the bill intends some sort of consistency -- along the lines of what I argued this morning -- it is generating some sort of inconsistency. The expropriations that take place may not be consistent in accordance with this legislation, but actually may be quite inconsistent. Mr. Ziegler also stated that most provinces now say that expropriations must be fair, sound and reasonably necessary.
This is not a person, in other words, who suggests that the state should just stay away from private property interests, and so forth. This is a person who is very sensible and understands that expropriations may be necessary under certain circumstances, but they must be fair. When looking at this legislation, we find that the expropriator -- in this case, the government -- may actually not be fair. This person is pointing out that there has yet to be a convincing argument put forward by proponents of this legislation that it is fair or consistent. It seems quite logical, if expropriation does take place, that it be fair and sound, even when it is reasonably necessary. Mr. Ziegler argued that such an objective body may, of course, be found in the courts.
At any rate, those who are concerned about property rights and the implications it has for property rights.... Indeed, when we think of Canadians as a whole, 60 percent of Canadians believe that they own their own homes, through mortgages or otherwise. Therefore any attack may establish a precedent for undermining or potentially denying the right to property in the future. As a result, it's a fear that could easily be generated by those who have interests that are being affected specifically by this legislation. Those people are arguing, and have argued, that what they essentially want is some sort of fair hearing. We must attempt to assure that.
The amendment does address it. I think it's very face-saving for the government to adopt this amendment. I urge all members of the chamber to accept the amendment. On the basis of fairness, on the basis of what is right in terms of due process and property law, this amendment must be strongly supported.
Hon. C. Gabelmann: I thought I would make a few comments indicating that the government does not accept the proposed amendment. It's clear from the debate that there is a fair lack of understanding of what course the government has embarked upon with this initiative. Having served for some years in the opposition, I understand the tendency for hyperbole and exaggeration. I embarked on that course myself upon occasion. In the course of today's debate, and when the official critic opened the debate last week, we heard a fair number of suggestions about what the bill might do, and that this bill in fact denies people the right to compensation for their property. In effect, that sums up some of the argument. Everybody hasn't made that argument, I must say; but many members have.
I just want to take a few minutes to indicate what lies behind this. First of all, it's clear to everybody in British Columbia that in recent years -- essentially starting in and around 1988, but in the late eighties -- government would, for one purpose or another, be "expropriating" licences and tenures, whether they were in the forest sector or the mineral sector. The examples we've seen are South Moresby in forest tenure, and Strathcona Park and some others on the parks side and in mineral tenures.
The expropriation board was established earlier to deal with the expropriation of private property. The rules around that issue, the understanding of private property, market value and all of those issues are clear, definable and understood by society and by all of our institutions. What haven't been clear are the rules, procedures and principles around determining value for "expropriated" licences and tenures.
Some members have suggested that fair market value is the way to determine that. Both the Leader of the Opposition and the leader of the third party made the argument that fair market value was simply the way to go. I don't know how one determines fair market value when there is no market, and there is no market in a park which allows no mining activity to take place for a mining venture. There is no market. The market value for mining property in that particular park is zero. Many people have said the expropriation value should therefore be zero, because there is no market, no price and no value. Therefore the government should not compensate in any way whatsoever for that "taken" resource. That's the market argument. The proponents of the market system would have that conclusion.
When you think about it, it's a zoning question in some ways. We have zoned the use of that land to be park and not for minerals. If by some initiative of government we upzone the property -- and local government is often involved in upzoning -- the value of the resource or commodity often increases. No one argues that the landholder in that case should not be.... I shouldn't say no one. This society does not now argue that the benefit of the upzoning should not go to the property owner. Clearly it does.
In the case of a downzoning, the property owner loses. The logical argument of the free market test is that we could zone -- in effect, by designating a land use -- a particular property in British Columbia for park purposes or for transfer to another jurisdiction or some kind of zone that doesn't allow logging or mining. The effect of that zoning is to create a zero value, and the logical consequence of the position of the two leaders will lead to zero being paid. That's an argument.
[ Page 1823 ]
On the other side of the argument are those who say that the potential value of the resource -- all of that potential value forever -- if it had been allowed to be exploited, managed or developed should go to the holder of the licence or the tenure. In other words, if a potential mine in Strathcona Park might have been worth $50 million, or it contains $50 million worth of ore, they should get the whole $50 million.
One of the questions that comes up there is: why would the shareholders get the $50 million? Why wouldn't the people who worked in the mine get their share -- or the people who provided services and goods to the mine development, or the community, or the taxpayer? On and on the argument goes. So you've got a range of possibilities, none of which make any sense. The zero doesn't make sense to me, and the maximum cost doesn't make sense either.
Another position is that sunk costs should be the money that's made available through expropriation. In other words, if you'd spent $50,000 developing the claim and it's taken from you by way of you losing your licence, then the $50,000 of sunk costs would be what is made available.
The expropriation board in British Columbia is not given any instruction in respect of these issues by this Legislature, unlike Alberta and other jurisdictions which in these instances have legislation in place to give instruction in the sense of the policies, procedures and philosophical underpinnings for making a determination. Is its market value potentially zero? Is it the whole potential value of the claim or the resource? Is it sunk costs? Or is it something else? What procedures will you put in place to determine those questions? We don't have that, and as a result, at the present time in British Columbia the procedures are for the affected party to argue in front of the Expropriation Compensation Board a wide range of possibilities at taxpayers' expense, because the taxpayer pays the full cost of all the legal arguments, the preparation of the argument and the resources and contracts that are entered into to provide argument that the shareholders should get the full value of the potential that may exist in a particular site.
So we have this situation where the taxpayers are spending enormous amounts of money -- and I mean enormous amounts of money -- to pay for legal arguments to propose a position which I think 99 percent of the taxpayers in British Columbia would find untenable. Listening to the debate, I think most members of the Liberal caucus, at least, would find it untenable that the full potential value of a mine site -- whether or not we can determine how much ore is actually down there -- will be paid to the claimant. That's an untenable position, and I'm certain that most people in British Columbia find it untenable. But that's the argument that is being prepared at our cost -- taxpayers' cost -- to make an argument in front of the Expropriation Compensation Board.
Interjection.
Hon. C. Gabelmann: Our view is that it's untenable that there is no law of the land. The member for North Vancouver-Seymour interjects that it's the law of the land. The problem is that there is no law in British Columbia now regarding the principles and procedures in respect of the taking of licences or tenures. I say "taking"; that's the word we use in the terms of reference for the commissioner. Other people could use the word "expropriation," and in a sense they probably mean the same thing.
[5:15]
There is no law of the land in this province, unlike other provinces. So we have commissioned a commission. Dr. Richard Schwindt from Simon Fraser University has been retained under the Inquiry Act to head the commission. He has been working on the commission and is required to make a report by or before June 30 -- less than five weeks from now. So we are not letting this go on forever.
There was a reference earlier in the debate by one member suggesting that, as a result of his report, we would make regulations to govern this area. That is not the intent. I want all members to know that the report that Dr. Schwindt prepares for us will form the basis of legislation which will govern this difficult area. We may not accept everything Dr. Schwindt recommends; I don't know. That's a decision for cabinet to make upon receipt of his report before the end of June. We want to develop legislation, but we didn't think we had, as a cabinet, the ability, the expertise or the time to properly do that without retaining an expert on the subject, as Dr. Schwindt is acknowledged worldwide to be. He is doing that work, and his report will come in. Following his report, legislation will be prepared. The legislation will give guidance to the Expropriation Compensation Board in respect of making decisions on these matters.
No one will lose their rights. Everyone will have the right to argue their case -- under the law of the province as it will then be -- in front of an expropriation board. There is no diminution of rights in any way, but there is a legislative framework that the people of British Columbia put in place through this Legislature in respect of the policies and principles to be applied in determining value. That's all we're doing.
The reason the date in the legislation is next year.... I don't mind sharing with the House that the first date proposed to me was earlier than that; it was this fall. My concern about a date this fall was that if the Legislature finished this summer sometime and didn't come back until the spring, we would be unable to comply with the provisions of this bill -- this act, if we pass it -- by getting new replacement legislation in before the fall. I didn't want us to be in the position where we had to rush a bill through the House in two or three weeks in late June and early July, within days -- at the most, weeks -- of Dr. Schwindt's report. So for that reason I extended the date. We introduced it April 1, and the date, I think, is June 30. That's 15 months. My hope is that we will be able to bring in new legislation this year, and once that new legislation comes in, this legislation is no longer in place; the freeze ends with the proclamation of new legislation.
I think it's a straightforward policy, and as I listened to the commentary from the members of the Liberal caucus in particular, I sensed -- despite the argument
[ Page 1824 ]
against the bill, and I understand that -- a recognition on the part of most members of the caucus that there needs to be something in place to govern what is, in our view, a very difficult area.
This is not a radical move at all, in my view; it parallels what other provinces have done. We want a regime in place which is fair and appropriate. That regime will follow the report of a commissioner, will follow cabinet consideration and will follow full debate in this Legislature on that bill at the appropriate time.
For that reason I think the amendment proposed by the official opposition is not appropriate, and I think it would be a very worthwhile move on the part of all members of this House to give serious consideration to supporting this initiative. It is something that's long overdue in British Columbia, and it will give certainty to the mining and forest industries in this province, because they will then know, if they do invest in a particular site, what the rules, regulations, procedures and policies are in respect of the consequences of having that particular site or licence or tenure expropriated. They don't now know. What could happen now is they could get market value, and that's zero. So this will provide....
The Leader of the Opposition shakes his head. The value of a mine in Strathcona Park today is zero. There ain't no value, 'cause there ain't gonna be a mine. And if you aren't going to have a mine, no one's going to buy the property. And if nobody buys the property, it's worth zero. That's a possible consequence, a possible outcome, of a hearing in front of the Expropriation Compensation Board. Not this bill. All this bill does is freeze the current actions and stop any others for the shortest period possible. What this process will lead to in this province is certainty and predictability in respect of the possible expropriations of tenures or licences.
G. Wilson: First of all, I would just like to take a moment to congratulate the minister for having paid attention to the debate and for the comments that he makes with respect to this debate. It's gratifying, I can tell you, from the opposition point of view, to know that the minister responsible for this legislation is listening and responding and providing honest debate on this subject. I don't intend to go through a lot of material that we've gone through before, but I do stand to speak in favour of this amendment.
If I can address two of the comments that the minister responsible addressed, it has to do with the question of fair compensation. I think he would suggest that where there isn't going to be a mine, there is no value. That is clearly not true. It is clear that if the government as an agency has provided a licence to an investor to go forward to invest, capital has been expended on the potential for developing a mine and this government, through expropriation or some form of land use zoning or regulation, removes the right of the individual to do what they are licensed to do, you have diminished their potential to realize profit from their investment. Because you have removed their right to realize profit from their investment doesn't mean that there was no value in the initial investment. Neither does it mean that the government shouldn't be required to provide compensation for the investment they have put in place. This opposition is not saying that if the government....
Hon. C. Gabelmann: How do you determine that?
G. Wilson: The minister asks how you determine that, and I'm about to get there.
This opposition is not saying that where we have an integrated land management strategy for British Columbia, which recognizes that there are going to be changing land uses and some lands exempted from mining, the government doesn't have the right to do that. We recognize that the government has the right to do that. We recognize that in some instances it might even be desirable for the government to take that initiative, protect some lands and put those lands aside. The question here is how to protect those who lose their investment as a result of government action.
If you review the situation in terms of Wells Gray, where there has been essentially an appeal to the Supreme Court -- the Supreme Court ruled that the government was liable and needed to pay a compensation based on a market value -- there is precedence suggested in British Columbia that you cannot simply expropriate without providing market-value compensation for the lost investment in that entity. I can tell you, Mr. Speaker, by way of comparison, when I was as an elected member on the Sunshine Coast Regional District board, the board moved to rezone a parcel of land that was the property of MacMillan Bloedel for acquisition of that land to provide expansion to the golf course there. This land, which was marginal forest land, had a value zoned as marginal forest land, and we exempted that and put it into a zoning classification for public assembly. What we essentially did was remove the potential for that land to realize its profit as timber land. It would have been absurd for me to have stood up at that point and said: "Because we have now arbitrarily changed zoning on this land and have removed the right to extract timber because we now have this land zoned for public assembly -- recreation -- MacMillan Bloedel has no investment and therefore has no realization for profit." Neither would we have been in a position where we could have legally or legitimately passed through the Ministry of Municipal Affairs the change in zoning that would have allowed us to, in the words of this minister opposite, downzone the property without providing fair market compensation for the lost investment in the land that was essentially there.
Interjection.
G. Wilson: The question is: what percentage? The percentage was market-driven. And that was done by a fair assessment of market value. That's how that price was determined. And it was a fair price to MacMillan Bloedel and to the taxpayers of the Sunshine Coast; it was fair because it was based upon an assessment of the market value of the original intention for the land.
[ Page 1825 ]
Now to come to the second point with respect to this amendment, it seems to me that if we're to get serious about maintaining some trust among those people who are investors in British Columbia, we cannot simply allow the discretionary right of value to be determined on the basis of a commission report, which is exclusively in the hands of this government. There has to be a proposition where some real measure of value is written in terms of the determination of compensation for lost investment. That's what this opposition is arguing.
Interjection.
G. Wilson: The minister suggests that that should be part of his report. The difficulty that we have with that is that unless the report is driven by something that is independent in terms of the assessed value -- and market value is something that I think we could depend upon -- then there is no guarantee that the company that has an investment is going to be able to get a realization back on that investment. That's our concern.
What we're suggesting to the government by doing this amendment is: we want to help you in this thing; we're not trying to hinder you. We are trying to assist you in finding a way that is not only fair and for government to be able to realize its potential goal which, I think, is a change in land value, which is something that people want to do.... If you're going to put in park protection or if you're going to get involved in aboriginal land settlement or whatever the reason may be.... But by the same token, we want to make sure that we do not introduce, in the case of this legislation, a regulation and law that effectively puts arbitrary power in the hands of a commission that does not take into account market value for compensation. That is something that we have to look at and address.
Hon. C. Gabelmann: That's the debate for the next bill.
G. Wilson: The minister suggests that that's the debate for the next bill. We'd like to nip it in the bud and get it down to debate it in this bill.
That's why we put this amendment forward, and that's why we would ask that all members of this House would support this amendment. I trust that when they see the wisdom of our words that they will endorse it with great vigour.
D. Schreck: I had the opportunity this afternoon to hear the Leader of the Opposition speak both on the bill and on the proposed amendment. I appreciate the opportunity to clarify differences between the two sides of the House. I was particularly pleased to hear the remarks of my colleague the Attorney General. I must say in all humility that he made me very proud and made me understand why I'm so pleased to be on this side of the House.
I would not be quite so generous in attributing understanding to the opposition benches, particularly after hearing the Leader of the Opposition again rise in debate and call for the elimination of this bill through the adoption of the amendment, and in particular illustrate a fundamental misunderstanding of the concept of value. The opposition could be described as knowing the price of everything and the value of absolutely nothing. What I gathered from their remarks is a misunderstanding of this piece of legislation, which is extremely simple. This piece of legislation basically says that there is no law in British Columbia now to guide in the process of determining value when we go to a third party that must resolve disputes. As a result, what we are saying is that we must halt the current processes until guidelines can be drafted and legislation can be debated in this House, at which time the clock starts again, and nothing is lost.
[5:30]
What do those members in opposition say? They are saying that they are concerned about the land claims process, and for that reason they want to interfere in this legislation. It disturbs me that those hon. members have this concern about the land claims process. It indicates one of the big differences here: a side, the members opposite, that advocates chaos, or the process that we are talking about of bringing certainty, guidance and confidence to British Columbia. If we are to get on with life, attract investment and create the ability to plan in British Columbia, everyone has to know what the rules are. We need confidence and stability, and that's what this process has as its end.
The members opposite say that they don't know what they're going to do about land claims or about value. All we hear.... Thanks to Hansard we will have the opportunity to go back and count the number of times my friend opposite used the term "free-market value," without ever understanding what free-market value meant. If we're going to have a market, we have to have a large number of buyers and sellers. We cannot possibly have a market on the South Moresby. We cannot possibly have a market on one mountain that may contain undetermined amounts of copper. We cannot possibly have a market on significant resource tenures, significant rights within this province, because there simply aren't multiple buyers and sellers.
What is the next alternative? We could have what the classical economist David Ricardo would refer to as an auction market where we'd have one valuable asset -- pick your particular jewel in this beautiful province -- and several, hopefully many, potential buyers. But that type of auction market does not determine value; it determines the maximum economic rent that can be extracted out of the party with the deepest pockets. That doesn't determine a fair means of compensation, because the person with the deepest pockets may be here today and not tomorrow, or vice versa. It is an arbitrary mechanism for moving a one-of-a-kind item and has nothing to do with the concept of value. It only determines the concept of economic rent in the short run.
So what else is left? How do we resolve this problem of determining value in the context of extremely unique, one-of-a-kind, massive and scarce resources in this province? We aren't talking about what price should be on popcorn at your local movie; we aren't talking about what price should be on used cars; we're
[ Page 1826 ]
talking about how you value the basic resources and land base of this province -- one-of-a-kind, unique resources. We have to make very difficult land use decisions, and there is no current law in British Columbia.
We could go through a variety of arbitrary accounting mechanisms, such as those followed by a cost accountant. Any cost accountant would first and foremost point out that the techniques used by such cost accounting are arbitrary. They can give completely different answers. They are only useful for making relative comparisons within that arbitrary cost-accounting framework. They are of no value for making major public policy decisions on how we bring certainty and confidence to this province.
What are we saying? We are saying that it is time to have a public debate on how we determine value for those land use decisions. We will have that public debate in this House when we have the results of the public commission that is underway, those results are put before government and new legislation is brought before this House.
What is the difference between the two sides? The difference is that this side is committed to a process. What we want out of that process is certainty and confidence. We understand the difficulty in determining value. We've put that problem before the public in the form of a public commission. We will bring that problem back to this House for debate on what the rules in this province should be. By comparison, what we have is a party that knows little more than to parrot a slogan that it doesn't understand, to talk about markets that in this case are non-functional -- a party that is willing to waste the resources of this province on mining claims rather than creating wealth.
It does not suffice to have a company that is more interested in exploiting the public purse on a settlement than in creating wealth by developing its mine or forest resource or claim to land. What we want is wealth creation in this province through stability and the attraction of investment. We do not want those who would see the opportunity to exploit the public purse as far more important than the opportunity to develop real economic wealth.
We are committed to the type of stability in this province that the opposition benches simply do not understand, which is why we have a multiple-step process. This is but the first step, and all it does is say: "Wait until the public can have input." We can't understand why those opposition benches are so impatient. We can't understand why they will not consult the public. We cannot understand why they have no understanding of the notion of value.
D. Jarvis: In standing up to speak in favour of the amendment to Bill 32, I am amazed that the government suddenly has woken up, seeing as there have never been more than four or five in the House to criticize us and explain what this is all about. I have the feeling that the member for North Vancouver-Lonsdale especially really doesn't know what he's talking about, in the sense that he's giving us a feeling that this government is surging ahead backwards.
Earlier, the member for Vancouver-Kensington asked why the opposition party did not take into consideration the logic of fairness. How can we accept this logic of fairness when the Attorney General, the sponsor of this bill, is himself on record as saying -- and I'll quote: "Maybe we have to say that land can no longer be privately owned in this province"? He cannot dispute that. When someone questioned him about it before the election he turned around and stated: "Oh, I was young when I said that." Well, he's still a bit young.
It is sad to consider that this government is utterly sincere in their naive belief that they can do no wrong. They have a very myopic sense of can-do-ism, I believe.
This bill ostensibly takes away the rights of compensation from individuals and companies, big and small, who have come to this province to do business, to invest, specifically in the mining industry, which I'm the critic for. These people come to the province with the hope that they will find some ore that is marketable and to make a profit, and at the same time this province benefits through taxes and wages. They come to this province from other jurisdictions of North America knowing that their property rights will be protected. They have been in the past. That has been the law of the land up until now. Now we have this government presenting legislation, and I would question whether a statutory right of compensation exists in this province.
A mineral claim is an interest in land. Once a mineral claim is accepted in the recording office, it becomes a legal grant, and the minerals inside the boundaries of that claim continue vertically downward. Sometimes I feel that the policies of this government are continually going downward as well.
Mr. Speaker, there is no doubt that this is the law, and it has been determined and reaffirmed by the courts: a mineral claim is an interest in land. The member for North Vancouver-Lonsdale says that there is no law. Well, there is a law.
The Leader of the Opposition was talking earlier about a situation that occurred in 1979 in Wells Gray Park. Thirteen claims were in dispute there. The tenures claimed compensation. The Socred government at the time said no and took the land away from them, took their rights away from them. In 1983, when the government lost the case in British Columbia Supreme Court, they appealed to the Supreme Court of Canada. In January '85 the Supreme Court dismissed that appeal, and the province of B.C. still remains in contempt, not having paid the compensation that they were supposed to.
You say that there is no way....
Interjection.
D. Jarvis: It's a good process, yes. You don't obey the law of the land, and the government is in contempt.
Mr. Speaker, the member for North Vancouver-Lonsdale is not aware of how you establish property value. There are only two ways you can establish property value: replacement cost or comparison. We have replacement cost of land, and that is ostensibly because of the investment that the mining company will make in the land. Replacement cost is what comparative
[ Page 1827 ]
places -- in the sense of buildings or land -- have sold for in other places. Well, we compare that with what court settlements have been prior to that. There's Casamiro out there. Casamiro has established what the value of land is. The claims up in Wells Gray Park -- the Supreme Court of Canada established what their values were.
Hundreds of thousands of dollars in legal costs will be incurred in this province if this bill goes through. There will be turmoil, and investors will hear the signals and avoid this province like the plague. If Bill 32 stands, private property rights in B.C. will be seen by the investment community as an illusion. Investments will dry up; the province's pro tem credit rating, which they're so anxious to talk about, will plunge and our economy will collapse.
I fail to see why industry has been singled out for this attack on their democratic rights. On this basis it is apparent that the NDP government does not believe in private property rights. This has to be considered so, or this bill would not be before us now. The commission is also a direct attack on the Expropriation Act. This is the act that protects each and every one of us from this arbitrary state of confiscation. When you confiscate the rights of property, real freedom is impossible without them.
[5:45]
I'll read you one more thing in conclusion: "Canada's Charter of Rights and Freedoms has left the interpretation of property rights to the Supreme Court of Canada, not to this province. This is a part of a wider constitutional evolution, which Canada has transferred from Parliament to the Supreme Court, the power and the duty to make some ultimate decisions. The Charter leaves to the court the responsibility for that, without which no real freedom is possible."
A. Cowie: Unlike the member for North Vancouver-Lonsdale, who has unfortunately just left the chamber, I will try to be rational, and I will try to be brief.
I speak in favour of this amendment. This amendment will fail to pay proper compensation. Government has a clear responsibility to negotiate fair compensation for tenured rights of natural resources which are taken back in the public interest. I spoke earlier today, stating that I believe we will have to take parkland. We will have to take other unique areas, but proper compensation will have to be paid.
Take a mining company, for example. This is what the previous speaker from the government side fails to understand. There are 359 potential mining sites in this province. A mining company takes out claims, and over a period of many years -- sometimes as long as 40 years -- they have to work on these claims until the market is right and the opportunity is right. The government required that these companies pay the government for the right to do this. On average, over that period of time each mining claim will take approximately $5 million of costs. Yet this government is saying at the present time that there will be no compensation. They're saying there's no compensation on those areas where a great deal of money has been spent -- not full compensation. Now the amount of that compensation is debatable, granted. We have to have a proper process, and we have one -- the court system, right now.
I would suggest that the government decide whether it's going to take land or not take land before bringing in this particular bill. We don't need this stage. The idea is to find out whether the government needs this land or not. Fine, take it and negotiate the amount of compensation. I would encourage hon. members to vote for this amendment.
L. Fox: I'm standing to speak for the amendment and primarily against Bill 32. I want to recognize the comments made by the minister only a brief while ago, in the very sincere and solemn manner that he does extremely well. I guess, as well, the comments of the member for North Vancouver-Lonsdale when they talked about property value.... The member for North Vancouver-Lonsdale mentioned South Moresby; that resource no longer had any value.
The other thing Mr. Minister makes reference to is the fact that once a mine is included within a park it has no value. Take that same kind of analogy and put it in the car insurance business. You total off a car; it has no value. We still expect, through our insurance corporation, to get a replacement value out of it. House insurance is the same way. It burns down; there is no longer any value there. However, we still expect to collect on the insurance we purchased. So the real value in that case was the depreciated value of that particular holding.
When we talk about the fact that we're going to close down mining in respect of parklands, and we're going to enlarge our parklands and that will, in some instances, consume some of our resources and our resource opportunities, my real concern there is that it's the action that causes the lack of value. It is not something that has no value prior to being included in parkland. In many cases, I think there could be good argument made as to why some of those resources should continue to be utilized even though they are within park lands. I think that there have been cases put before this House where it makes good sense to do that.
I'm really more concerned about the message. Government can quite easily defend this bill by saying it affects only large corporations. It's really the people's resource here, and we should in fact protect the people's interests. I find no fault in that principle statement, but at what point do the people get value out of that resource? The people get value out of the resource when it in fact is extracted. That's the time the people get the value from it, through either job creation, community development or economic development in those respective areas.
[The Speaker in the chair.]
My concern is that what we're sending out here is a message. This government is sending out a message that is very hard for me to accept. When I look back on the legislation and some of the actions of this government, I see that we've yanked the contract with the doctors' pension. I see that 60 golf course developers
[ Page 1828 ]
had their initiatives denied. They also were denied any compensation for the expense that they entered into under the previous administration, wilfully, and so on, within the law. All of a sudden the law was changed, and they too lost the opportunity to go before government and seek some compensation. Municipalities had their powers usurped when this government, without consultation, removed the supplementary homeowner grant and froze the revenue stabilization grant, which, in my view and in the view of many municipal leaders, is the property of those particular municipalities. Hospital boards had their rights usurped when the Vernon hospital board was told it had to do something which, in their view, was not supported within the community or within the hospital board.
It's the message you're putting out there, Mr. Minister, that you do not want development. You are a heavy-handed government. You want to centralize powers within the structure of the 21 ministers. That's the concern that I have -- the underlying factor that this would set a precedent as to what could happen when many of these resources could be affected by native land claims issues. That has got to be a concern of the investment community.
When we talk about mining investment, we're not talking about the short term here. The 18 months that this bill delays the process will be one of the most detrimental facts to mining exploration that this government has put forward. Eighteen months is two full seasons where you're going to stop anybody from developing properties that they feel could at some point be included in this 12 percent.
This government may know where the other 6 percent of the parks is coming from. I'll tell you, when I speak to people from different regions of this province who are promoting parkland, they all feel that a large part of that park is going to be in their particular region, and they're going to encourage this government to look after their concerns. That's what leads to the indecision of industry. They do not know at what point properties are going to be considered as parks, because there are many initiatives out there -- far beyond the 12 percent. That is going to be a major hindrance to mining exploration in the rural parts of this province.
Earlier today when I was listening with some intensity, I saw the Minister of Government Services talking about and heckling with respect to who is going to pay for school construction, health care and social programs. Well, I'm concerned about that as well, because the initiatives of this government that I've seen are limiting the amount that we are going to afford to pay. They're limiting the amount of exploration. When I spoke the other day about the fact that this year Placer Dome is spending $60 million to $70 million on exploration outside of this province and very little, if any, within it. That's got to be a major concern to this government, and this bill adds to that concern.
Several government members likened this process to a zoning process. Well, I want to ask all the members on the government side if any of them would build a house on a piece of property that they thought was going to be rezoned in the next few months, to the point that it would no longer comply with the existing zoning, and therefore your house would be of no real value. How would you look at that particular process? I don't think you would invest your money and build your home, because you knew that your money was not going to be of any value to you if that downgrade in zoning took place. I spoke before, and I'm very sincere in this; I'm really concerned about the message. I'm really concerned about the message that the investment community is getting out there.
I appreciate the minister's very soft-spoken approach to the issue earlier, and his attempts to explain it to us. Certainly, had I not had the bill before me, had I not had some of the concerns addressed to me by individuals out there, if I were one of the listening audience I would say: "Look, here is this nice minister again. He's talking to us in his nice, soft manner, and he really is doing something for us." But my concern is, in fact, just the opposite.
Another area that really concerns me -- and we had one member of the opposition speak to it -- is that this bill, once again, puts more control in the hands of the cabinet. You know, a member stood up earlier and said they're going to come back here.... In fact, I think we had a new Premier while you were out, Mr. Minister, because he stood up and made all kinds of promises on behalf of his government, and I really believe that maybe he figures that being an economist gives him an opportunity to be a new leader.
I am concerned. This particular section will allow this cabinet to make changes through orders-in-council, to make changes without coming before this House. They will be able to use their powers unilaterally, without coming before this Legislature to make changes in regulation. They could extend it beyond June 16, perhaps. They may decide that they want to broaden it. Who knows? I certainly don't. But I'm certainly concerned, as is the investment community out there.
[6:00]
Hon. Speaker, I have had the time pointed out to me, and I would move we adjourn the debate until the next sitting.
Motion approved.
Hon. C. Gabelmann: Hon. Speaker, I move that this House stand adjourned until 6:06 p.m. this evening, and upon resumption the House will continue to sit no later than 10 p.m.
Motion approved.
The House adjourned at 6:01 p.m.
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