1993 Legislative Session: 2nd Session, 35th Parliament
HANSARD
The following electronic version is for informational purposes only.
The printed version remains the official version.
(Hansard)
WEDNESDAY, MARCH 31, 1993
Afternoon Sitting
Volume 8, Number 11
[ Page 4893 ]
The House met at 2:07 p.m.
Prayers.
M. Lord: Hon. Speaker, it gives me a great deal of pleasure today to welcome two constituents from Denman Island in my riding. Would the House please join me in welcoming Jim and Norma McLeod.
L. Reid: Hon. Speaker, it's my pleasure this afternoon to welcome Jim Cameron and Carole Burdett, with students from Keith Lynn Alternative Secondary School in North Vancouver. I ask the House to join me in welcoming them.
D. Symons: It is my pleasure to introduce to the House Karl Pollak, who lives in Richmond and has a long history of involvement with the political process. Would the House please make him welcome.
G. Brewin: On behalf of the MLAs and MPs for the south Island, I wish to introduce a group of University of Victoria social work students who have been doing their practicum work in our constituency offices. They have done some awesome work, members of this Legislature. I'd like to introduce them: Alicia Parker, Rennaa Bacy, Bonnie McMachon, John Campos, Pam Griffin, Rick Briggs and Diana Moffatt. Their supervisor is Cheryl Moir Van Iersel. The federal constituency assistants -- Lynda Reid, Van Buchanan and Lynn Osborn -- and the provincial ones -- Cynthia Carver, Don Innes, Bruce Fogg and Lorie Bennett -- have been supervising them, and they've done a wonderful job. I want you to make them welcome.
Hon. A. Hagen: Hon. Speaker, I've had the pleasure of meeting a very special guest who is in our building today. Her name is Nonkolisho Sigcau. She's from Transkei in South Africa, and she is on a tour of Canada to learn about our government. She is the guest of my ministerial assistant, Shelley Canitz. I'd like us to give her an especially warm welcome.
J. Dalton: I'm pleased to welcome to the House today -- and I'm sure all members will do so -- approximately 15 members of the North Shore Women's Liberal Commission. They were going to bring over their thousands of fellow Liberals, but they didn't want to inundate the House. Would the House please make them welcome.
D. Mitchell: Hon. Speaker, we have in the public galleries a couple of special guests who have come over today to follow up on the incredible news they heard yesterday. They wanted to see if all the details of the provincial budget were really true. Would the members of the House please welcome the publisher of the Province, Don Babick, and editor-in-chief, Mr. Brian Butters.
U. Dosanjh: I have the privilege to introduce to the House about 80 grade 11 students from Charles Tupper Secondary School in my constituency, Vancouver-Kensington. They are accompanied by their teacher, Mr. R. Pajala, and several other adults. Could the House please welcome them.
F. Gingell: I ask all members to join me in welcoming to the House today my good friend Rick Watts and my son, John Gingell, who kept me up half the night talking about this and that.
L. Krog: I notice a good friend of the third party -- and one of my constituents -- is here today. Would the House please welcome Mr. Pat Fraser.
K. Jones: It's with great pleasure that I introduce Dick Kirby to the House. He is a long-time Liberal participant in the Victoria area, one who has kept Victoria very active.
CIVIL SERVICE TRAVEL
W. Hurd: A question for the Minister of Finance. Would the minister explain why the budget for civil service travel in the province is slated to rise by $5 million, to a total of $65 million, when taxpayers of the province are being hit with $800 million to $1 billion in tax increases?
Hon. G. Clark: I'm sure a fuller explanation will come during estimates debate. But we're very proud on this side of the House that we've brought the rate of government spending down from 12 percent to about 7 percent, and now to under 6 percent. We've protected health and education services, and we've brought the deficit down to $1.5 billion for next year.
W. Hurd: Supplemental to the Premier, who likes to travel himself. Perhaps the Premier can explain why his government ministries are spending the equivalent of $1.25 million a week -- or $250,000 a day -- on civil service travel. Will he at least commit to reduce the amount of civil service travel on behalf of the people of the province?
Hon. M. Harcourt: We were able to find about $40 million in waste and inefficiency last year in the budget, and $35 million has been identified so far. If the hon. member can show where he thinks a public employee shouldn't leave Vancouver and Victoria to go to Terrace, or even to his riding.... Where it's a wasted trip, we like to hear about it. We don't want to see the taxpayers' money wasted.
PREMIER'S OFFICE SPENDING
W. Hurd: While the Premier is looking for spending cuts, could he perhaps tell the people of the province why spending in his own office is going up by $1.1 million in the current fiscal year?
Hon. M. Harcourt: The sooner we finish this year's budget and get into the estimates for next year's budget, which rests with the opposition, I'll be more than happy to talk about my estimates in the normal course of events.
[ Page 4894 ]
SIZE OF B.C. PUBLIC SERVICE
J. Weisgerber: My question is to the Premier. According to the estimates tabled yesterday, 30,256 full-time employees are authorized in the provincial civil service in fiscal year '93-94; that's after an allowance is made for the contractors who've been rolled into the civil service. Can the Premier tell us how many employees are in the provincial civil service today?
[2:15]
Hon. M. Harcourt: I will get that detailed information for the Leader of the Third Party. Some of that information was in the budget; I'm sure he's read it. I'm sure he also realizes that the previous government had hundreds, if not thousands, of people illegally out on consultant's contracts and was not following the income tax, UIC and other rules laid down by the federal government. Those people had to be brought back into the civil service before the federal government descended on us for those actions.
J. Weisgerber: I would have expected that the Premier would at least know how many people work for the civil service. The fact is that 29,073 FTEs are employed by the government today, an increase of 1,600 over last year. How can the Premier possibly justify adding even more employees, given the horrible state of his government's finances?
Hon. M. Harcourt: I think it's unfortunate that the Leader of the Third Party is advocating a return to the radical restraint program of the Bennett years. We've obviously rejected that approach. We have rejected the approach he is advocating: that British Columbians be less educated and that their health standards be lowered. We're not taking that approach; we're taking a balanced approach.
As a matter of fact, the hon. Leader of the Third Party was predicting a $3 billion deficit just a short time ago. I'm sure he will be pleased that we have reduced their $2.4 billion deficit to $1.5 billion, and it will come down further.
J. Weisgerber: Given the fact that government borrowing will increase by $3 billion dollars this year, there are many who would say I was right -- bang on.
In any event, my question to the Premier is: given the serious fiscal constraints his government faces, has he decided to place a freeze on public sector hiring?
Hon. M. Harcourt: I think the Leader of the Third Party should go back and look at the 10 percent reduction in the acute care health system that has been worked out with workers and hospitals. That is a model for the kind of cooperation we need to bring about between employers and employees, instead of the radical restraint approach that the Leader of Third Party is trying to bring back. The government under the Social Credit Party tried to treat public employees as public enemies number one, instead of helping them to have good morale to work on behalf of the people of this province. With the last round of radical restraint, they didn't learn from history.
INCREASED TAXES AND CROSS-BORDER SHOPPING
L. Stephens: My question is to the Minister of Economic Development. We were winning the war against cross-border shopping, but given the increases in sales and gas taxes and the extension of the sales tax to a range of labour services, this government is sending consumers back across the border. How can this minister justify this further assault on small businesses of our border town merchants?
Hon. D. Zirnhelt: After this budget B.C. will remain competitive with the jurisdictions around us. You know perfectly well that the major impact on cross-border shopping is the value of the Canadian dollar. Under all circumstances, that is what makes the difference. As long as the dollar remains favourable, we think that we have stopped the tide of cross-border shopping. Therefore....
Interjection.
Hon. D. Zirnhelt: We have increased the costs minimally. But you have to be reminded that Washington is reputed to be thinking about putting on a 20-cent-a-gallon tax, which will more than redress the imbalance that may have been created.
L. Stephens: A supplemental to the Minister of Economic Development. The ministry has lost its mandate in promoting trade, real capital investment is down 16 percent, and now it has lost the community economic development program to B.C. 21. Will the minister table any feasibility studies that were conducted to determine the need for B.C. 21?
Hon. D. Zirnhelt: As is well known, this government transferred the responsibility for trade promotion very early on from this ministry to the B.C. Trade Development Corporation. It did that so that it would not be a bureaucracy but rather a corporation promoting trade overseas much more effectively. They could go to a performance-based system. It's a more businesslike way of handling it, and I don't think this government has anything to be defensive about. It achieves some efficiency, and it is a more businesslike approach to promote trade overseas. Now the....
Interjections.
Hon. D. Zirnhelt: I can't hear for the clatter coming from across the way.
The Speaker: If the minister would conclude his comments.
Hon. D. Zirnhelt: Well, it was a very long question; maybe I should conclude.
COMPENSATION TO SENIOR CIVIL SERVANTS
G. Farrell-Collins: My question is to the Premier. In the past few months the taxpayers of B.C. have found that the government has been paying ridiculous
[ Page 4895 ]
perks for Crown corporation heads, including free ICBC car insurance for Robyn Allan and the West Vancouver golf club fees for the head of WCB. Given the $1 billion tax grab the taxpayers were hit with yesterday, will he release for public scrutiny all perks paid to senior civil servants in this province?
Hon. M. Harcourt: Yes, the pay that goes to the senior people in the Crown corporations.... Some of the things that the hon. member has mentioned concern the government, too, and that's why we appointed Judi Korbin to look at the whole issue of compensation in Crown corporations, in municipalities, in school boards and in colleges and universities, where we provide a very significant amount of the funding for them without the kind of accountability that the public wants. That's the kind of accountability we want to bring to those various organizations.
G. Farrell-Collins: Supplemental. We want to talk about perks; $1,200 a day is a pretty good perk to do that type of report. I assume the Premier's answer was a yes. To the Premier again: last night the taxpayers of B.C. witnessed "Mr. Rogers Does the B.C. Budget," live on TV by satellite linkup. Will the Premier tell the taxpayers of B.C. how much he spent advertising this futile PR sham and why it was necessary to rent a satellite truck from U.TV, just so the Premier didn't have to leave his office? How much did it cost?
Hon. M. Harcourt: I'm just astounded sometimes by the people across the way. Who writes these questions that they throw out that are phrased in such a silly way? I am astounded that the member would be offended that the Premier deals directly with the people through the cablevision of this province.
Interjections.
The Speaker: Order, please.
Hon. M. Harcourt: Hon. Speaker, I can tell you that this Premier is proud of what we were able to accomplish in this budget in terms of protecting basic health and education services, bringing down the deficit and bringing some hope to the people in the regions and to the people who are hurting in this province. And I'm prepared, hon. Speaker....
Interjections.
The Speaker: Order, please, hon. members. This is question period. If the member has a final supplemental for the hon. Premier, I will advise the House that we will extend question period to account for the enthusiasm of today's question period.
G. Farrell-Collins: I, too, hon. Speaker, am thrilled that the public of this province were allowed to see firsthand that this Premier doesn't know what his budget's about and how much of a sham it was. It's just unfortunate they had to pay for it, hon. Speaker.
EXTENSION OF CORPORATE CAPITAL TAX
Another question to the Premier. Seeing as he's looking to save so much money and looking to tax revenues, given the government's inability to control public sector wage increases during the last year -- and Ken Georgetti's comments yesterday that those who can pay more should be paying more -- will the Premier commit today to include the hundreds of millions of dollars of capital held by trade unions in this province in the corporation capital tax -- in the spirit of fairness and balance? I'm sure Ken Georgetti will be glad to go along with it.
Hon. M. Harcourt: Again, I'm astounded by these questions. He now wants the provincial government to bring in a corporate capital tax on the pension funds of this province. This is the new policy....
Interjections.
The Speaker: Order, please, hon. members. I cannot hear the Premier's response to the question. Premier, if you'd like to conclude your remarks....
Hon. M. Harcourt: Yes, I will, hon. Speaker; I will conclude.
With those kinds of policies, I can see.... I'm an open Premier. I'm prepared to be in front of the citizens of this province like I was last night. I've always been an open and available political leader. If I was a member of this Liberal caucus, I'd want to hide.
Interjections.
The Speaker: Order, please. I recognize the hon. member for West Vancouver-Garibaldi.
Interjections.
D. Mitchell: Thank you, hon. Speaker. Hon. members, thank you.
B.C. RAIL PURCHASE OF VANCOUVER WHARVES LTD.
I have a question for the Premier. One of the great secrets of yesterday's budget was the Crown corporation slush fund -- almost a billion dollars which apparently is going to be used for increased intervention in the private sector of the economy of British Columbia by this very activist government. Can the Premier tell us if he agrees that commercial Crown corporations should be diversifying into new business sectors, such as B.C. Rail's purchase of Vancouver Wharves Ltd. last week, where they now compete directly with their own customers?
Hon. M. Harcourt: I don't know if the hon. member was here yesterday -- I think he was -- when I think the Minister of Transportation and Highways, who is responsible for B.C. Rail, answered that. As a matter of fact, what I've heard from the port people is that they're pleased that B.C. Rail, a stable and good B.C. company, has taken over Vancouver Wharves, which was struggling. It is now going to be able to serve
[ Page 4896 ]
a lot of the customers of B.C. Rail even more effectively for our overseas markets.
Hon. R. Blencoe tabled the 1992 annual report of the Assessment Appeal Board of British Columbia and the 1991 annual report of the B.C. Assessment Authority.
Hon. A. Charbonneau tabled the annual report of the Insurance Corporation of British Columbia.
Hon. M. Sihota tabled the annual report of the Workers' Compensation Board of British Columbia.
[2:30]
Budget Debate
(continued)
F. Gingell: Yesterday afternoon we were witness in this chamber to a massive smash and grab directed against the people of this province. The minister said today that this will only affect taxpayers who drive a Mercedes Benz, earn more than $100,000 a year and live in a $1 million house. What a load of rubbish! The vast majority of British Columbians will feel the direct effect of these taxes, and all of us will pay a price in lost jobs, diminished economic growth, faltering investment and, yes, reduced government revenues.
Today my office has been inundated with calls from these angry taxpayers. It's an act of fiscal ferocity, unparalleled since the Barrett years. Fully $1.4 billion of tax increases will be sucked out of the people of this province in the coming year -- and this is on top of more than $1 billion in tax increases in this minister's 1992 budget. The taxpayers are bleeding and they are fed up. The fiscal lifeblood of this province is being drained; the minister has apparently embraced Count Dracula as his role model. As an insult to this massive injury, the minister has added still another billion dollars to the NDP spending spiral for the coming year. This is a budget clearly out of control; it's a disgraceful example of voodoo accounting with this minister pressing home the pins. Mark my words: the government will pay dearly for this in just the same way as the people of British Columbia.
Let's look at some of these tax increases stripped of their velvet protectors. Take the income tax surtax. The minister spoke innocently about taxpayers in the first tier paying a mere 11/2 cents more and taxpayers in the second tier paying a mere 3 cents more. What he neglected to mention was that the first-tier surtax is now up to 30 percent. The second-tier surtax, which was 10 percent in 1991, 20 percent in 1992 and 30 percent in 1993, will now climb to 50 percent. This means that the rate of B.C. income tax, including surtax for the second-tier earners, has risen from 56.7 percent of basic federal tax in 1991 to almost 79 percent in 1994 -- a 40 percent increase over four years. What sort of message does this convey to those who put in the long hours and take the personal financial risks that are the cornerstone of a healthy economy? It was interesting today to listen to the NDP members in this House chortle and shout with glee and bang their desks when the suggestion was made that the so-called wealthy of this province were going to pay more taxes. That was a disgrace, hon. Speaker.
Let's look at the school property tax surtax. I think this was the most shocking tax grab in the budget -- a thinly veiled 1.5 percent wealth tax that in many cases will force middle- and lower-income earners and retirees from their homes. These people will lose their homes solely because they were unlucky enough, years ago, to move to the wrong neighbourhood in the wrong community. It will particularly discriminate against certain geographical areas in the capital region and the lower mainland, where rising property values have already placed a huge tax burden on homeowners. It will send a clear message to offshore investors and would-be immigrants that if they bring their capital to B.C., they'd better watch out. The minister says these revenue measures are aimed at high-income earners. In this case he's missed the mark by a country mile. The elderly, trying to stay in the homes where they raised their children and now welcome their grandchildren, will be hit the worst.
Then there's the sales tax increase. The general increase in sales tax to 7 percent will cost the taxpayers of British Columbia hundreds of millions over the next 12 months. More importantly, it will provide a major disincentive to both consumer and business purchases at a time when the economy is struggling.
If raising the sales tax was not enough, the minister now wants to collect it on a much wider range of transactions in order to raise an additional $228 million on a full-year basis. So we are to have a sales tax on parking spots and a special sales tax on cars that cost more than $30,000. The sales tax will now apply to the entire value of a new car purchase, even when there has been a trade-in. Now certain labour services are subject to this sales tax. A stranger list of tax targets I've never seen. Lawyers' services are taxable, but accountants' are exempt. Watch repairs are taxable, but house painters are exempt. Engine tune-ups are taxable, but automobile towing is exempt. Having someone alter your coat is taxable, but having your child's coat altered is exempt.
Not only has this government rejected harmonization with the GST, it now seems intent on constructing a parallel system of sales tax complexities to provide work for an army of tax collectors and to further frustrate business and consumers. There's the loss of the basic homeowner grant of $470 to those with homes worth over $450,000. Again, it's clear that this provision is targeted toward the lower mainland and the capital region, without reference to taxpayers' earnings.
The general corporate income tax rate is climbing again. It was raised by 1 percent last year and by another 0.5 percent in this budget. And the list goes on. Medical Services Plan premiums are going up by 3 percent. The Pharmacare deductible is being increased by 20 percent. Liquor prices are climbing by 3 percent. The renter's tax deduction is gone. The tax on gasoline has gone up by 10 percent. There is to be a new car rental tax of $1.50 per day. Fees and licences are going up by how much? We are not told.
[ Page 4897 ]
What about the backdoor tax increases that taxpayers face, as well? There's everything from higher ICBC premiums to the hydro rate increase announced last week. Of course, there are municipal tax increases resulting from provincial off-loading.
Hon. Speaker, none of these last-mentioned taxes, fees and premiums have any relationship to ability to pay or to income earned, but they all have a direct bearing on how outsiders view this province's investment climate and on how individual B.C. residents feel about their future economic opportunities. As for the corporation capital tax, it remains. If the minister is expecting congratulations from me on the slight increase in the exemption level, he will have a long wait indeed. The corporation capital tax is a destroyer of jobs and a stop sign to investor interest in this province. It should have been repealed; it must be repealed.
What this minister does not seem to grasp -- and probably never will -- is that our economy is dependent upon energetic individuals, financially healthy companies, an entrepreneurial spirit and the flow of investment dollars. When a government sends a message as blunt and discouraging as this to the private sector and to individuals, watch out! The people who should be marshalling our future economic growth will see themselves simply as flotsam in a rising sea of public spending. The cost will be to the economic well-being of this province and of all British Columbians.
Last year the government raised personal income taxes. They projected that the total personal income tax revenue would be $4.7 billion. And what did they get? They got receipts that were $700 million less than projected and $270 million less than the previous year, after they had raised rates. The minister's solution? Raise taxes again. He is blind to the likely result: yet another decrease in tax revenues, as economic activity is stifled, initiative is discouraged, investment is frightened off and the underground economy grows and grows.
I do believe people would have a greater tolerance towards these massive increases if they felt their finances were being prudently administered. But all they see is the minister with his hands in their pockets and his friends at the trough. While demanding massive increases from British Columbians, the minister is increasing spending in the coming year by $1 billion. And all of this will be by debt financing; all of this will be added to the provincial debt. The direct provincial debt has climbed from $4.7 billion in March 1991 to $10.5 billion projected for the end of March 1994, an increase of 123 percent in three years -- a shocking and disgraceful result. And the total debt of government and Crown corporations is up $9.3 billion since 1991, a 56 percent increase. Not even the minister's Cheshire-cat smile can make this deficit disappear. It is now absolutely clear that the Harcourt government is determined to match the Barrett government's record as a one-term wonder, leaving the salvage efforts to others.
What will all of this new tax money be spent on? What compelling reason does this government have to take away the taxpayer's hard-earned dollars? To spend it. But to spend it on what? Is there something that will give the taxpayers so much extra value that they will be glad to pay their taxes? The hon. minister was too reticent to tell us where the money is going, so I will. Interest on the debt has increased by $180 million, welfare rolls have increased by $329 million, and the pay of civil servants employed directly by the provincial government has increased by $260 million. Not for one second do the taxpayers of this province believe that this mess is good value for their hard-earned dollars.
Let's look a little closer at some of these numbers. The number of direct government employees has increased 2.4 percent over last year's budget. But listen to this: the pay and benefits of direct government employees will increase by 15 percent over last year's estimates. I have problems working out these calculations because they lead me to the appalling conclusion that government employees will, on average, receive an increase of 12.3 percent, which is so repugnant that I have trouble believing that even this government has that much gall. Is this restraint, or a betrayal of trust to the people of this province?
[2:45]
Let's turn to the welfare rolls. There's been a 17 percent increase in the Social Services ministry in the last year. In the past two years the Social Services ministry's spending has increased by $850 million, or 43 percent. Over three years it has increased by $1.2 billion, or 70 percent. This is truly government out of control. It is no wonder that the people of this province are incensed, both by the failure of the NDP social policy and by the overspending of this ministry. What an admission of failure of NDP social policy, and what a draw on the taxpayer. When 43 percent of recipients are single males, the greater proportion of which are under 30 and employable, why does this government not seek an alternative? Instead they carry on, and the hard-working taxpayers foot the bill.
The lack of discipline in meeting goals and holding to spending limits is prevalent in virtually every ministry, but nowhere more so than in the Ministry of Social Services. That ministry was reviewed by the auditor general, who made numerous recommendations for improving efficiency and accountability. But we have a ministry which is ignoring these recommendations and neglecting to make the difficult decisions it needs to make to become more efficient.
Even when cheaters are found, apparently the minister won't follow the recommendations of the RCMP to prosecute. Is this fiscal responsibility? The ministry has not demonstrated any recognition of the need to change. That bureaucracy will expand to the tune of $408 million. No vision has come forward for breaking the dependency cycle of welfare, and the only certainty is that government policy will increase the number of welfare recipients.
The budget of the ombudsman's office is up by 18.9 percent -- a 37.5 percent increase in two years. Perhaps the increased funding is necessary for a review of the government's investment in MacMillan Bloedel.
Then there's Aboriginal Affairs, where spending is up 54 percent over two years; Education is up by 11.3 percent over two years; and Health is up by 13.2
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percent. Civil service travel is up $5 million, to $65 million. Finally, there's the debt servicing, the cost of paying for past overspending, which will go up by 20.8 percent this year. It's up almost 60 percent over two years. So where is the restraint?
The Finance minister was quite proud to point out that spending on government office furniture was down $3 million, presumably because they've finished renovating their offices and those of their patronage appointments. What a crumb to throw to the taxpayers!
There are other areas where the government is proposing to spend its tax-and-grab windfall. The shackles of our children's future is being forged link by link, bond issue by bond issue, by a government intent on borrowing from tomorrow to live beyond its means today.
Not all spending is up, hon. Speaker. If you look at ministries that involve wealth creation, investment and economic development, it's a different story. Agriculture is down 9.9 percent over two years, Economic Development is down 56.8 percent over two years, Energy, Mines and Petroleum Resources is down 4.1 percent this year, Tourism is down 15 percent over two years and Forestry is down 2 percent this year. These figures are a study in contrast to the huge increases in the social ministries. It's the flip side of the social spending spree.
Yesterday the Finance minister talked about the difference between spending on groceries and buying a home. Having insufficient personal income to buy all the groceries on his list, the minister is now remortgaging the home to complete his social shopping list, while ignoring the upkeep on his house. You can't expect any home to hold its value if you place no importance on its maintenance.
The proposed deficit is $1.5 billion. Deficits are simply deferred taxes that we will have to pay in the future. So what does a $1.5 billion deficit mean to us? All the new taxes this year total $855 million. In order to pay this future tax bill, we will have to suffer twice the pain of this budget, plus compound interest. The 1 percent increase in sales tax will raise approximately $300 million. To pay the future tax tab that we are now running up will require the imposition of the equivalent of an additional 5 percent in the sales tax. That is frightening. But when you add in the borrowing to fund capital projects, you will find another $1.5 billion, for a total increase of $3 billion in government debt this year. That's $3,000 per family, and the cumulative debt at the end of this year for this province alone will be $26,000 per family. When will it stop? We must set goals for ourselves to pay our way as we go, to balance budgets and to pay off the accumulated debt.
During the last election this government promised to balance the budget over a five-year budget cycle. It has now clearly abandoned that goal. To explain to the hon. NDP members what this promise meant, it was that over a five-year period the revenues would equal the expenditures. Now there's no more talk of this; now this government talks of balancing the budget once in every five-year period -- maybe. They have betrayed the promise they made to the people of this province. Furthermore, the government's plan to reduce the debt by reducing the deficit is clearly nonsensical. It can't be done. You can't pay off debt by losing less money. Wake up, Mr. Minister. You have to make a surplus.
There are only two ways to fight the deficit: reduce government and develop practical policies that promote a healthy, diversified economy. This government has chosen to undertake neither option in this year's budget. The Finance minister likes to comment on the fact that B.C. is the province with the largest amount of growth in the country. But economic growth through a welcome-wagon economy is not going to prepare us to meet the Pacific tigers head-on.
The opposition is not alone in requesting a reduction in the level of government spending and a drastic reduction in the deficit. The Canadian Bond Rating Service has put up credit watches on the provinces as a result of the dismal financial performance of 1992. B.C.'s coveted AA+ rating has been put in serious jeopardy due to the spendthrift performance of this government during the past year.
In the Peat Marwick Thorne review, Moody's public finance department's "Ratings News" was quoted as stating: "The recent economic downturn, combined with continued high expenditure growth, has caused a deterioration in the province's financial performance. The ability to demonstrate control over spending will be an important consideration to future credit quality evaluations." Considering that this government has been unwilling to control government spending in any way, shape or form, one can only imagine what the bankers in New York and Boston are doing at this very minute -- sharpening their pencils in preparation for the appropriate time to lower our credit rating and further add to the costs of our borrowing.
This is only half a budget; the other half is missing. The hon. minister has forgotten entirely that half of the job, which is to provide stimulus to the economy and to provide the right climate for growth so that the economy can sustain the burden of government. Given the content of the budget, perhaps he gave up the other half as a hopeless task. The NDP has completely abdicated the requirement to focus on economic growth. The budget does not address competitiveness. There is no economic planning for the future, no economic growth strategy. All of this is missing, with appalling results.
They clearly just do not understand their task and their responsibilities. What budget could be more disheartening to international investors and local businesses? Not only are there higher taxes, but the wealth-creating ministries continue to be cut back. What is this government doing to stimulate economic growth in this province? Nothing! What is this government doing to entice business to locate in this province? Nothing! It's scaring it away. The government treats wealth as a sin which they will purge. They consider any wealth left in private hands as simply unpaid taxes. There is no realization of the relationship of provincial wealth to business investment -- no job creation and economic growth.
What is it doing to sustain existing business in this province? It's making business more difficult through unfair labour codes, the unreasonable timber licence
[ Page 4899 ]
provisions of Bill 2, higher taxes and greater uncertainty. The NDP have gone on about the need to rationalize the allowable annual cut available to the forest industry. They have insisted that they recognize the need to establish forestry as a continuous, sustainable and vibrant part of British Columbia's economy. For all their talk, there is still no accurate inventory of the province's forest resources. However, government has wasted no time in scooping 30 percent more revenue from the forest industry during this temporary rebound. There has been no accounting of the return which we are getting for the use of the resource or of whether such innovations are economically feasible. Meanwhile, continued changes to the Forest Act and random, unexpected reductions in the AAC have shaken investor confidence and weakened the industry.
If that were not enough, they indicated their intent to pursue the direction outlined in the infamous Schwindt commission report. If they are sincere in this pursuit, they will completely destroy the underpinnings of both the forestry and mining sectors in British Columbia.
They have now delivered the coup de gr�ce to the forest industry. They have given themselves new powers to arbitrarily cut allowable annual cut under the guise of an economic development bill. This will allow them to reduce available timber at the discretion of the Ministry of Forests whenever production falls. This is without regard to market conditions, to supply and demand and to all the other tricky economic concepts which this government cannot grasp. The minister will be able to reduce cutting rights, to force mills to produce at a loss or to close them down altogether; and all of this is almost entirely at his discretion. Rather than acting to promote and develop those areas which are the bread and butter of our economic security, this government has undermined them. Their professed concern for the rights of workers is commendable, but it will all seem rather academic when there is no work to do. Indeed, if words were action, the forests of B.C. would positively sing with harmony and prosperity. But words are just that, hon. Speaker, and the only sounds we hear today are the sounds of protest and anger.
As bad as the plight of the forest sector has been under this government, it pales when compared to the desperate situation in which the mining industry now finds itself. From the abandonment of Cassiar to the crisis in the minister's own riding in the Kootenays, a once-prosperous industry has come apart at the seams. Rather than dealing with the issue, the NDP have continued to try to convince the people of the province that there really is no problem, as if people cannot see for themselves. Instead of moving to aid the industry and finding ways to get it back on its feet, this government has decided to kick it while it's down. Last year we saw the massive expansion of the corporation capital tax -- a tax which bleeds money from companies when they're losing money. We witnessed huge increases in water rental fees. We saw a myriad of fee increases applying to prospecting, exploration and mine development. We have seen the average time spent acquiring government permits go from approximately six months to an average of four years. Due to this past year of closure, there will be almost no mining taking place in B.C. by the end of this decade.
[3:00]
The minister has continually reassured the opposition and the people of British Columbia that there are great plans in the works and that relief is waiting just around the corner. We now know this to be untrue. The government has ignored the desperate need for reduced taxation, less bureaucracy, faster permitting and more certainty. Investor confidence in mining development has all but disappeared from British Columbia and is finding its home instead in places such as Argentina, Chile and Mexico. For many decades B.C. remained the preferred destination for mining investment, exploration and development because of its natural mineral wealth and stable, reliable government. It is a sad reality that this government has managed to negate these advantages in the first year of its mandate. What is sadder is that there is absolutely nothing in this budget to indicate that they have realized their errors and are prepared to learn from them.
We have seen a phenomenal change in public opinion over the last few years on the subject of government spending, taxes and the deficit. At every level of society, whether in business or among the middle class or the disadvantaged, across all political lines and ideologies there is agreement on one proposition: that governments have spent too much, borrowed too much, taxed too much, and it simply must stop. People are worried. They do not wish to leave economic chaos to the next generation any more than they wish to leave a contaminated environment. This is one of those fundamentally decent collective determinations that a society makes in times of crisis, a decision to do what is right.
What all politicians will hear today, if they care to listen, is the voice of the people telling them it's time to get it right. The message is clear. People do not want to hear the cynical pronouncements that we all came to expect from budgets in the last decade, and they don't want flimflam, whether it be the BS fund or B.C. 21. They want straight talk and the job done right. They don't want to hear that governments create jobs; they know whose tax dollars provide the paycheques for those jobs. They don't want to hear that government will stimulate the economy with handouts and giveaways; they know the money will be borrowed, and they know who will pay. And they don't want to hear governments blaming other levels of government and the governments of other years.
We are in a serious financial crisis. To those concerned British Columbians listening today, if you live in a constituency with an NDP member, write to him or her and send a copy to me. If your member is in opposition, write to the Minister of Finance, copied to me. We can all be reached at: Parliament Buildings, Victoria, B.C., V8V 1X4.
The Speaker: Order, please. Hon. members, debate in this chamber is not a place to advertise telephone numbers, postal codes, etc. I would encour-
[ Page 4900 ]
age all hon. members to address the debate. Please continue.
F. Gingell: Thank you, hon. Speaker. I certainly hope that I haven't offended you in any way, but I do encourage the people of British Columbia to write to us. You know where we are; just put it in an envelope and address it correctly, and I'm sure the Post Office will get it here.
Now is the time for the best of cooperative leadership, for federal and provincial governments to start working together and stop this partisan finger-pointing. The puffery and posturing involved in debating the fiscal record of 1991 has no place, no relevance and no meaning in 1993. People simply want to hear that government is finally listening, finally getting it right. Hon. Speaker, this budget gets it terribly, terribly wrong.
The Speaker: I recognize the hon. member for Fort Langley-Aldergrove.
G. Farrell-Collins: Hon. Speaker, traditionally.... I assume the Leader of the Third Party would follow the Leader of the Official Opposition. He appears not to be here. Perhaps we could recess for a few moments until he arrives.
The Speaker: It is up to will of the House. I recognize the hon. member for Abbotsford.
H. De Jong: Hon. Speaker, I would ask for a couple of minutes' recess so I can get the leader up here.
The House recessed at 3:07 p.m.
The House resumed At 3:09 p.m.
J. Weisgerber: Hon. Speaker, that's genuinely appreciated, I assure you. Like the repairman, it gets a little lonely at times.
Hon. Speaker, last week the government assured us it had the courage to change; now we know it doesn't. After raising our taxes by $1,000 a family last year, and racking up the largest deficit in B.C. history, the NDP said they were finally ready to make tough decisions necessary to cap the deficit. Well, there certainly was a lot of tough talk in the budget, and even more nerve. It takes a lot of nerve to increase taxes by $1,000 a family for the second straight year, while boosting government spending by double the economic growth rate. It takes a lot of nerve to double the accumulated deficit in just two years, while actually bragging about capping and reducing the deficit. It takes incredible nerve to impose $800 million worth of new taxes, and then use that money to pay off your political supporters, and create a society dependent on welfare.
That's what this budget does; it's a tax-happy budget that proves beyond any shadow of a doubt that the NDP are unfit to manage our money. It's an utterly irresponsible budget that will snuff out economic expansion and saddle our children with a monstrous debt, which will turn them into little more than indentured servants of the Crown. The NDP calls that courage.
All members opposite ought to hang their heads in shame, and indeed they appear to be doing so. This, in fact, is a cowardly budget -- a budget without a backbone. This budget shies away from the central challenge it's supposed to address: the problem of runaway government spending. Everybody in British Columbia knows that government has grown too large and too expensive for our own good. Incredibly, this budget not only perpetuates the problem, it compounds it.
Instead of reducing the size and scope of government, this budget will increase the bureaucracy by 1,183 full-time positions. It will sink us deeper into debt by more than $3 billion. It will suck $1.2 billion more out of our economy in higher taxes, and it will seriously hurt investor confidence, which has already been badly shaken by this NDP government.
The government claims to have its ear to the ground, but it can't hear the thunder on the streets. Taxpayers have reached their breaking point. They've simply had it with being had by this government. Not a soul in British Columbia believes that their taxes ought to be raised, because everyone knows full well that this government hasn't done a darned thing to cut costs. What people are saying to the government today is this: "Keep your hands out of my pockets. You've already screwed up our economy; you've already scared off investors from the world over. Now screw up your courage, go back to the drawing board and bring us a budget that we can not only live with but prosper from." That's how taxpayers are responding to this budget.
British Columbians are more than willing to make the necessary sacrifices in order to get our fiscal house in order. But they're not prepared to have their real income slashed by higher taxes that are going straight into the coffers of the BCGEU, the HEU and the BCTF. People aren't going to sit still for increased taxes while welfare fraud is allowed to run rampant and 73,000 single employable men are allowed to sit around and collect welfare.
Taxpayers resent being soaked for more money when the government is wasting the taxes it already collects on a $200 million fixed-wage program that's a subsidy for unionized construction workers. It's appalling that the government could even consider raising taxes when it's spending over $2 million a year on political staff in this building alone. British Columbians understand that there's no easy way out of our current fiscal crunch. It takes real leadership and political resolve, and it takes a little courage.
[3:15]
What needs to be done isn't easy, but it's really quite simple. We need to cut spending in real terms by reducing the size and scope of government, while at the same time increasing efficiency and productivity. That means cutting staff, freezing wages and eliminating programs. We need to increase revenue by creating more income and by eliminating the barriers to economic growth that this government created. We need to restructure our tax system in order to make it more sensitive to income and profit. We need to dedicate every new penny collected in taxes to reducing the debt.
[ Page 4901 ]
These are the measures necessary to restore investor confidence. These measures, unfortunately, are not reflected in the budget. The NDP has given up all pretense of fiscal responsibility. The election promises of "balanced budget" and "no new taxes" are out the window.
Remember what the NDP election platform said. After supposedly adjusting for the reduction in federal transfer payments, this is what the Premier promised: a maximum deficit of $900 million in 1992-93 -- not the $2 billion deficit his government actually delivered. He promised a maximum deficit this year of $400 million -- not the $1.5 billion deficit we're facing today. Here's the part I like best -- keep in mind these are the Premier's words: "We will closely monitor economic conditions in the initial years and adjust spending accordingly to meet the legislative requirement of a five-year balanced budget. If the money isn't there, we won't spend it." Indeed, if the Premier had a nickel for every time he uttered that last phrase there wouldn't be a deficit; we'd all be rich.
After coming to office, what was the first thing the new NDP government did? It repealed the Taxpayer Protection Act, which the Premier had not only voted for but promised to abide by. This year the government's gone hog-wild. Instead of cutting expenditure, the government is planning to spend nearly a billion dollars more than the Premier projected at most for his second year in office.
In other words, the NDP misled the voters. Now they're playing with our tax dollars and telling us we should have the courage to suffer in silence. Even the goal of a balanced budget is now unthinkable for the NDP. The NDP member for Nanaimo said last week: "That's not courageous; that's frankly stupid." He said: "When you consider that...70 percent of gross provincial revenues are devoted to Health, Education and Social Services, anybody who has the temerity, indeed, foolhardiness, to say that courage is to cut the deficit and balance the budget.... That's foolhardy; that's not courage." Believe it or not, those are the words of the member for Nanaimo; and even though he languishes on the back bench, he really does speak for the Premier and for the cabinet.
[D. Streifel in the chair.]
The trouble with the folks across the way is that most of them measure the value of government by how much it spends, not by how little it spends, or how it spends. So where is the money going? How will the government spend that $19 billion in this year's budget? How much of the money is for public sector salaries and benefits?
According to the Korbin commission, at least 60 cents of every dollar spent will go for wages and benefits. That means that close to two-thirds of this year's budget will go towards public sector salaries and benefits -- over $11 billion. Over three-quarters of all health and education spending will be for salaries and benefits. Over 300,000 British Columbians -- almost one in five people working in British Columbia -- are on the public payroll.
According to the government personnel services division, there are currently 1,600 more civil servants directly employed by the province than there were a year ago. That's not what the government reports in its books, but it's a fact. It's also a fact that most of those employees now have BCGEU membership cards. As of one month ago, the government had 29,073 full-time-equivalent employees. This budget plans to increase that number by almost 1,200 full-time employees. Again, that figure doesn't include teachers, health care workers and Crown corporation employees. That's how this government is going to spend our tax dollars; that's why our taxes are being raised. It boils down to higher wages and more bureaucrats, which is not to say we don't have the best civil service in the country. We do, but when we talk about cutting the cost of government, let's understand that public sector salaries cannot be exempt from those cuts -- and neither can welfare costs.
Last year the government boosted its social services budget by over $400 million, a 22 percent increase in one year. The NDP has done it again this year: the welfare budget is up 17 percent, another $400 million. A good portion of these costs could have been avoided and should be cut immediately. One in ten British Columbians is now on welfare; 57,000 more people are on welfare today than were a year ago. The biggest jump in welfare caseloads has been single employable men. Why is that, when unemployment rates have fallen in the last year?
Vancouver fraud squad detective Dennis Tiessen might have some thoughts on that question. His unit has just busted a ring of welfare cheats who have ripped off the system for hundreds of thousands of dollars. As he said: "We're only scratching the surface. We're losing millions in welfare fraud every year and it's getting worse." Indeed, this government ignored similar, RCMP warnings about the extent of welfare fraud. It liberalized the rules on lost and stolen cheques. They don't even have to be reported to the police anymore. That's obscene.
Other policies have also contributed to the massive increase in welfare costs. Single parents are now regarded as unemployable. They don't even have to look for work until their youngest child reaches age 19. Meanwhile, this government's taxing the daylights out of those single employed people who are working harder than ever to make ends meet. These are the theoretically rich folks that the NDP has targeted to pay for its new dependency society.
Hon. Speaker, 11 out of 18 ministries will receive budget hikes that are larger than the projected increase in the gross domestic product. Even the Premier's office received a budget increase that's well above the GDP forecast. Is that leadership? Of course not. It's lolling -- plain and simple. It's more money for patronage appointments, more cash for the major unions and by extension more money for the NDP. If the NDP had even a little courage, they would live up to the Premier's election promise and they would reduce expenditures to live within the taxpayers' means.
I'll tell you what we would do, given the current fiscal crunch. We would freeze all public sector salaries
[ Page 4902 ]
for two years. Even Bill Clinton froze public sector salaries for one year. We would downsize the bureaucracy -- perhaps not to the extent we did in the early eighties, but substantially. We would eliminate programs that are not offering enough value for money. A Social Credit government would establish performance standards and move toward a performance-based pay system that rewards productivity and efficiency. In short, we would exercise restraint -- the forbidden "r" word that's as much taboo today in the NDP as it was 20 years ago. But rather than cutting public sector salaries, this government lifted the wage freeze we had put in place on senior bureaucrats' salaries. Now it screams foul at school boards for raising administrators' salaries that had been part of that wage freeze. This government has given teachers retroactive wage settlements that were triple the rate of inflation. It's given the BCGEU a wage hike that's triple the average increase in the private sector. It's granted health care unions a whopping wage hike and a reduced work week that the HLRA estimates will cost taxpayers as much as $529 million over three years. It has given those same unions a no-cut contract that puts them in the driver's seat over hospital staffing levels.
To add insult to injury, the government has hired 20 percent more political hacks in this precinct alone at an additional cost of $316,000. The total price tag for these wage hikes and additional bureaucrats is in the order of $1 billion extra. Future wage hikes will bump that cost even more. Every cent of that money will be borrowed and financed through higher taxes.
Over the past 18 months we've heard a lot of bellyaching from the NDP about the financial situation they inherited from the Socreds. It's true we spent too much, particularly in our last two years in office -- although it was never enough for the NDP. They always demanded much more. But according to the auditor general, we also decreased the accumulated deficit by $700 million during our first four years in office. Not only that, we left behind the second-lowest tax rate in the country.
It's worth taking a couple of moments, for a little reality check, to review the tax structure we left behind. Let's compare the situation with what exists today. Until yesterday, Social Credit's 6 percent sales tax was the lowest in Canada except for Alberta, which doesn't have a sales tax. Now we have a 7 percent sales tax that's been expanded to a wide range of services. Repairs and maintenance on motor vehicles, furniture, appliances and business equipment, sports equipment and clothing are being taxed. Even parking will be taxed.
Last year we said it was just the thin edge of the wedge when the NDP introduced the provincial GST on legal services and telecommunications. Now it is more apparent than ever that the NDP, the party that fought so hard against the federal GST, is setting the stage to harmonize the provincial sales tax with the GST. That's why they brought in this made-in-B.C. GST. This year consumers will pay a 14 percent tax on labour services, including the federal GST. If there is any doubt that the tax base will continue to be expanded in the years to come.... There is none at all. I don't think this government is fooling anyone.
These higher sales taxes will drain an extra $533 million out of our economy every year. That will barely cover the extra interest on the new debt incurred by this NDP government in its first two budgets. The Socreds left this government with the second-lowest tax rate in Canada. That rate has been increased. The Socreds' income surtax was 10 percent on incomes over $80,000 a year. This government has tripled that surtax and extended it to incomes over $60,000 a year. Any family making $60,000 a year is rich in the NDP's books. That is consistent with the Finance minister's view that senior citizens living on an $18,000 a year pension are doing -- and I quote -- "very well."
[3:30]
The former government left the NDP the third-lowest small business income tax rate in Canada; we now have the highest small business rate in the country. The Socreds left behind the third-lowest general corporate income tax rate in Canada; British Columbia now has the second-highest corporate rate in all of Canada. We had the second-lowest gas tax in the country; now it's the sixth highest. The Socreds were moving towards the total elimination of residential school property taxes; this government increased school taxes last year and again this year.
Last year the government also eliminated the supplemental homeowner grant that reduced school taxes by as much as 50 percent. Now the NDP is phasing out the basic homeowner grant altogether for many British Columbians with higher-valued homes. It's imposing a new surtax on homes valued at more than $500,000. In addition, this government has increased rural property taxes for the second year in row, and it has also increased non-residential property taxes.
Then, of course, there's the new corporate capital tax, which even taxes debt as an asset. The prices of beer, wine and spirits have all been substantially increased. Our tobacco taxes are now the highest in the country. Every fee, licence and permit in the book has been increased by this government, and new ones have been added.
This year alone the government is planning to grab $290 million from B.C. Hydro -- nearly three times the amount collected by the former government. This miraculous feat is explained by an increase in hydro rates that are double the national inflation rate. ICBC rates have been jacked up by 29 percent. Even the Medical Services Plan premiums have been increased in this budget for most families.
When the Socreds left office, interest payments on the public debt were 54 percent lower than they are today. Now the NDP is blowing a billion dollars a year on interest payments on the debt. This government's spendthrift ways have increased debt-servicing costs by $345 million a year, despite a drastic drop in interest rates.
The 1 percent increase in the sales tax is expected to generate an extra $305 million a year. In essence, every penny of this year's sales tax increase will go toward paying the interest on new NDP debt. At the rate this government is going, the sales tax will be raised by at least 1 percent every two years just to offset the increased cost of borrowing. This government is drown-
[ Page 4903 ]
ing in red ink, and it's taking our economy down with it. Not only is the NDP refusing to make any serious spending cuts; they're accelerating spending by 5.7 percent. That's twice the rate at which the economy is growing, twice the rate of inflation.
The NDP's only answer to revenue shortfalls is to tax, tax and tax. They slapped a 10 percent sales tax onto new cars and trucks valued at more than $32,000. That tax will add at least $1,300 to the price of those vehicles. To make matters worse, the government has wiped out the sales tax trade-in allowance on all cars and trucks. On a typical trade-in valued at $10,000, this punitive tax grab will add $700 to the price of the vehicle. This budget also increases the gas tax to 11 cents a litre, a 22 percent hike over the rate that would have been in effect under the Social Credit formula, which indexed gasoline prices to the rate of inflation.
Two years ago the NDP member for Boundary-Similkameen stood up in this House and said: "The provincial gasoline tax is probably the most draconian tax in British Columbia." Last year he stood up and said: "The price of gas in B.C. is much higher than it should be." Now that same Minister of Agriculture sits in cabinet and says nothing. And what about the Minister of Transportation and Highways, the member for Kamloops? He sat quietly by while cabinet decimated his capital construction budget. Now he plans to impose tolls on new highways and bridges and foist today's construction costs on the backs of tomorrow's taxpayers. The government didn't even have the courage to mention the word "tolls" in the budget, let alone tell us how much it is planning to raise by this new form of taxation. They want us to sign a blank cheque. They want us to pass a bill that will give the Highways minister unlimited authority to determine how much those tolls will be and how they'll be applied.
For 125 years government after government managed to build new roads and bridges on a pay-as-you-go basis. Now the NDP wants to build them on our children's money. In the long run this method of mortgage financing will triple the capital costs of every new highway and bridge built. By capitalizing the costs of highway construction over 40 or 50 years, this government is effectively putting roadbuilders of tomorrow out of business. There won't be any money for new highways construction in the future, because it's all being blown by this government's deficit construction plan. You simply can't keep borrowing more and more each year to build new roads if you can't afford to pay the interest on the debts you've already incurred. Heaven knows, we want to see continued construction of roads and bridges, but they should be built from existing revenues, not by going deeper in debt.
Hon. Speaker, that's why the former government had established the Freedom to Move special account. We dedicated over half a billion dollars in 1991-92 to capital construction projects aimed at improving our transportation infrastructure. This year alone the government plans to collect $857 million in fuel taxes, motor vehicle licences and permits, plus another $34 million in Coquihalla Highway tolls. Yet it's only dedicating $96 million from general revenue for highway construction. The rest of the capital budget will be borrowed money -- new taxes and tolls. That's the way it is with this NDP government. Buy now, with little or no money down, and pay the rest later. That attitude won't impress the lenders; it won't inspire confidence in the investment community.
Last October the Minister of Finance bragged in this House that: "We have the highest credit rating of any province in Canada; we have the lowest per capita debt of any province in Canada; we have the best economic performance of any province in Canada." Indeed, such was the legacy of Social Credit -- even after last year's record deficit, even after the NDP's new Labour Code, the Schwindt report and the corporate capital tax. But now that legacy is in serious jeopardy. The province has already been put on notice by the bond-rating agencies that its credit rating is probably going to be downgraded. And no wonder. In its first two budgets this NDP government has increased its direct debt by about $4 billion, or $1,200 for every person in British Columbia. Debt-servicing costs are up by 53.4 percent over two years ago. The total direct and guaranteed debt, including Crown corporations, has increased from under $20 billion to $26.4 billion with the NDP's first two budgets. Think about that. It took 125 years to hit the $20 billion debt mark. Think of all of the infrastructure that's been built since Confederation: dams, roads, bridges, schools, hospitals, ferries, public buildings, stadiums, power lines and railways. It's amazing to think how much we've built. Yet what has this government built in its first 18 months in office?
An Hon. Member: Bureaucracy.
J. Weisgerber: Granted, it's built a massive bureaucracy -- a huge bureaucracy -- but that's hardly something to brag about or to hold up as an achievement for an increase of $5 billion, of $6 billion or of as much as $7 billion in increased debt. Simply put, this government has spent its money on public sector wages, welfare and hush money for its union friends.
[The Speaker in the chair.]
Consider the accumulated deficit -- yet another measure of this government's fiscal incompetence. It's defined by the auditor general as the total of all government deficits and surpluses. The auditor general confirms that by March 31, 1992, after the NDP had been in government for five full months, the accumulated deficit stood at $4.96 billion. By the end of this fiscal year, that figure is going to double.
The government says it's not their fault, that it's the federal government who is to blame. What nonsense! Yes, the federal government has been offloading its costs onto the provinces, but that's nothing new. According to a report by Ernst and Young that was commissioned by this government, federal offloading cost the province $3.9 billion during the last government's term in office. The auditor general reports that during that same five-year period, the accumulated deficit was increased by a total of $1.4 billion. If the cost of federal offloading is deducted, we would have had a $2.5 billion surplus. That may be, but so what? The fact remains that governments must take full responsibility
[ Page 4904 ]
for the budgets they administer, and this year's $1.5 billion deficit is 100 percent made in B.C. by this NDP government.
Sooner or later this government is going to wake up and smell the coffee. It has to get a grip on reality. The cost of servicing the debt is growing out of hand. If you don't believe me, for heaven's sake listen to what the Investment Dealers' Association of Canada is saying. Just last month they warned that: "Government debt is accelerating at an alarming pace, both in absolute terms and relative to the economy. Net direct debt as a share of GDP has vaulted by two-thirds in the past three years, after significant reductions in the debt burden in the late 1980s." They stress that government spending remains excessive and continues to expand faster than the underlying tax base. And to the member for Nanaimo, who doesn't believe in balanced budgets, the IDA also said that the government must place priority on balancing the budget by mid-decade. This time the IDA were charitable in their remarks. Rest assured they will be less so after they get a good look at this budget.
Unfortunately for all of us, lenders will also take note. The price of borrowing is going to go way up for this government, because it doesn't have the good sense to listen to what the market's telling them. The NDP has ignored the IDA's observation that: "The government's recent modification to provincial labour laws poses a very real risk to business investment over the longer term." That opinion is borne out by Lucy Roschat, president of the Hong Kong-Canada Business Association, who says that the new corporation capital tax and labour code are making foreign investors think twice about investing in British Columbia.
[3:45]
As Blair Wilson, president of the Canadian Manufacturers' Association, put it: "Money will go where it is respected and encouraged." Offshore money has lost confidence in British Columbia, so the government shouldn't be surprised by the fact that capital investment in B.C. dropped last year by 8.6 percent, double the rate of decline for Canada as a whole.
Business confidence in B.C. will not be buoyed by this budget. The government can trumpet its B.C. 21 initiative all it wants, but international investors will recognize it for what it really is: a scheme to disguise the true magnitude of this year's staggering deficit. The last thing we need right now is a new Crown corporation. How many bureaucrats will be hired to fill it? At what cost? Mark my words, B.C. 21 is a black hole in the making. At its centre is the dark force of Bob Williams. This new megacorporation is going to cost us a bundle. Debt is debt, interest payments are simply interest payments, and regardless of what you call it, B.C. 21 means more of both. Likewise, spending cuts are spending cuts, restraint is simply restraint, and that's what investors are looking for: that, and for greater certainty and predictability from this government.
It's great that the government wants to build schools, hospitals, roads and ferries. That's what governments do. But they should do it within the taxpayers' means, and this government is already living too high on the hog. Our economy would be much further ahead if the government addressed the real barriers to wealth creation that it erected. If you want to know what those barriers are, read the Minister of Energy, Mines and Petroleum Resources' discussion paper on the problems facing the mining industry. Read the B.C. Chamber's two-part business review of this government's first two years in office. If the members opposite haven't seen those reports, I would be happy to provide them with a copy.
The common thread that runs through all of the problems identified is a lack of certainty and trust in this government and its policies. Investors aren't going to invest a plug nickel in this province if they don't feel confident that they can trust the government, and right now they don't. They've been deceived time and time again, whether the issue was Bill 84, the future of the horse-racing industry or the promise of a balanced budget. The Premier can go back to Hong Kong, and I'm sure he'll get a polite reception; but he won't bring back the bacon, he won't inspire confidence. The truth is, business leaders from here to Hong Kong don't trust this government to keep its word, no matter who the message carrier is. After all, what does the Premier expect people to think when he says one thing and does another, when he promises no new taxes and then brings in at least three new taxes in one budget?
The Premier may not care that no one from the B.C. business community wanted to stand beside him at the world economic summit in Davos, Switzerland. "Quite frankly, it has no impact on me one way or the other," he huffed. "If other people choose not to come to Davos, that's their problem, not mine." Well, he's dead wrong about that. He's wrong not to be concerned about the rapid deterioration in the relationship between his government and the business community. It's not enough only to listen to the Ken Georgettis and John Shields's of the world; the Premier should also pay close attention to the sentiments expressed by the president of the B.C. Chamber of Commerce. He speaks for thousands of small businesses and, indirectly, for their employees when he says: "The government either at best is lacking in an understanding of the real-world business risks and barriers being created by its policies or at worst is intent on imposing an ideological agenda on this province, regardless of the destruction caused to businesses, jobs and investment." This budget points to the latter. It's ideological to the core, and by that I mean naive, narrow-minded and shortsighted.
This is a classic NDP budget, sugar-coated for the nineties. All the right words are there, except the word "restraint." At the root of all the politically correct jargon are seven silent words that define this budget: higher spending, increased taxes and crushing debt. We're being buried alive in taxes and debt. If the members opposite meekly accept this budget, they're consigning our children to a fate worse than debt, for the sad truth is that this budget doesn't just tax us to pay for the NDP's excesses, it squanders the promise of a better world for our children. It threatens their birthright as Canadians to quality health care, education and social services. It imperils their standard of living. If we allow this budget to pass, we will be digging a hole for future generations that they may never be able to earn their way out of.
[ Page 4905 ]
This budget doesn't steal just from today, it steals from tomorrow: from our children, our grandchildren and generations to follow. It's not leadership, it's a breach of trust. As such, our caucus will be voting against this budget on behalf of all those it disenfranchises.
E. Barnes: Hon. Speaker, I'm looking forward to participating in this debate, but for the present I would like to move adjournment of the debate until the next sitting of the House after today.
Motion approved.
Hon. M. Sihota: I rise to seek leave of the House to call a motion to divide the Committee of Supply into sections A and B.
Leave granted.
DESIGNATION OF SECOND ESTIMATES COMMITTEE (COMMITTEE A)
Hon. M. Sihota: I move:
"Be it resolved that this House hereby authorizes the Committee of Supply for this session to sit in two sections, designated section A and section B; section A to sit in such committee room as may be appointed from time to time, and section B to sit in the chamber of the assembly, subject to the following rules:
"1. The standing orders applicable to the Committees of the Whole House shall be applicable in both sections of the Committee of Supply.
"2. Subject to paragraph 3, within five sitting days of the tabling of the main estimates, the House Leader of the official opposition and the House Leader of the third party may jointly advise the government House Leader in writing of three ministerial estimates which they require to be considered in section B of the Committee of Supply and, upon receipt of such notice in writing, the government House Leader shall confirm in writing that the said three ministerial estimates shall be considered in section B of the Committee of Supply.
"3. All estimates shall stand referred to section B, save and except those estimates which shall be referred to section A on motion by the government House Leader, which motion shall be governed by the provisions of standing order 60A. Practice recommendation No. 6 relating to consultation shall be applicable to this rule. In the absence of the consent of the House Leader of the official opposition and the House Leader of the third party, estimates from nine ministries only may be referred to Committee A.
"4. The Committee of Selection shall appoint 22 members for section A, being 14 members of the New Democratic Party, six members of the Liberal Party and two members of the Social Credit Party. In addition, the Deputy Chair of the Committee of the Whole, or his nominee, shall preside over the debates in section A. Substitution of members will be permitted to section A with the consent of that member's Whip.
"5. At 30 minutes prior to the ordinary time fixed for adjournment of the House, the Chair of Committee A will report to the House. In the event such report includes the last vote in a particular ministerial estimate, after such report has been made to the House, the government shall have a maximum of ten minutes, and each opposition party a maximum of five minutes, to summarize the committee debate on a particular ministerial estimate completed, such summaries to be in the following order: (1) third party; (2) official opposition; and (3) government.
"6. Committee B shall be composed of all members of the House.
"7. Divisions in section A will be signalled by the ringing of the division bells four times.
"8. Divisions in section B will be signalled by the ringing of the division bells three times, at which time proceedings in Section A will be suspended until completion of the division in Section B.
This proposes, with the consent of the House, to continue the practice which occurred during the last sitting in this House. I think it has to be considered in the context of parliamentary reform. There were concrete steps taken last year which allowed for estimates to be done in the Douglas Fir committee room under the committee system, and which allowed for all members to participate in wide-ranging debate with regard to the number of estimates that were heard in that room.
I think the general experience was that it was a progressive and rational step in the evolution of bringing about some kind of reform to parliament. I'm not persuaded that it went far enough, and, if I may, without telling too many tales out of school, I'll say that I've canvassed this matter with the House Leaders. I would like to commend the House Leader for the third party for some of the comments that he made during the course of the throne speech debate -- his ideas about opening up the procedures and the process with regard to estimates. I'm hopeful that as time develops, and as people become more familiar with this process, we will be able to reform and allow for a greater degree of scrutiny and openness during the course of the estimates process in the other room.
I appreciate that there are times when, given the size of the opposition caucus -- both the Liberal Party and Social Credit Party -- it does place some demands on their caucuses, as it does with members on this side of the floor as well. Nonetheless, it's a system that worked well last year. I think it was an experience that most enjoyed, and it's one that we should (a) try to continue this year, and (b) endeavour to reform should the opportunity arise.
With that said, I look forward to the support of all hon. members with regard to this arrangement being accepted by the House.
J. Dalton: Even though the official opposition certainly is, to use some of the words of the House Leader, progressive and rational -- I think everyone in this House will agree with those -- I have to rise on my own behalf and on behalf of the official opposition to oppose this motion.
We don't mean to be obstructionists -- in case the members opposite are thinking that we're stepping back in time. I have two or three reasons that I'm going to advance, and then I believe some of my colleagues may also wish to participate.
I don't share the wild enthusiasm that the Government House Leader has expressed about last year's
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experiment. It never hurts to be innovative and to break new ground, but I think we all have to appreciate that there's a proper venue and avenue for debate -- whether it be estimates, legislation, motions, or what have you. And this House -- the chamber itself -- is that place. So unless we can be convinced -- and quite frankly, we were not so convinced from last year's splitting the committees into A and B.... From our perspective, that experience was not a comfortable one. Admittedly, we now have a year under our belt, but we anticipate -- and perhaps this will alleviate some of the concerns of both the government side and the third party -- that this year's estimates will progress in a smoother and more orderly fashion than sometimes was the case last year.
Quite frankly, I think this forum -- the chamber, the floor of the House itself -- is the appropriate place for every minister to be held accountable for his or her estimates so that we can adequately discuss the budget for each ministry and the policy decisions. I truly believe -- and I don't think that this is just a statement to fill some time -- that the people of this province want the opportunity for each minister to be questioned in this environment.
Let me refer to some of the difficulties of last year. It was not always easy for members on our side to be in two places at once; I think everyone can appreciate that. It's not always the critic who leads in questioning the ministers. So if an estimate in Committee B is taking place in the Douglas Fir Room, it is very awkward for the opposition, which has a particular function and role to play in this Parliament, to effectively do its job. I hope the government is not inviting the opposition to back off from its responsibilities; the debate in estimates is certainly a very important part of those responsibilities.
[4:00]
I listened intently to the format and procedure that the Government House Leader advanced. Those are some of the details that have to be worked out over time. Again, our concern is that even though the government advances the cause of parliamentary reform, we are not convinced that the process and format of splitting the Committee of Supply into A and B is functional or is best serving this Parliament and, more importantly, the people of this province.
I will conclude by saying that even though the Government House Leader spoke of scrutiny and openness, I have to wonder whether there will be true scrutiny and openness and whether the process will be best served if we allow this motion to go forward. I and the official opposition will certainly be opposed to this motion.
C. Serwa: Hon. Speaker, it's a pleasure to rise and speak on this particular motion. It's not often that I agree with the government of the day on a variety of issues -- certainly not in this term -- and I don't intend to set a precedent here. But, in fact, Committee A and Committee B have functioned very well.
Our Social Credit caucus sees that as an important first step in the types of reforms that have to be implemented. I was encouraged not only by the comments of His Honour the Lieutenant-Governor in the introduction to the throne speech but also by the comments in the throne speech with respect to change. I believe that the change that occurred last year with Committee A and Committee B was most positive. It didn't take anything away from the estimates debate, which was covered in both committees by Hansard. The written record could be used by members for the express purpose of holding ministers accountable for their ministries' actions and expenses over the past year.
Our caucus would be much happier if all the estimates would be moved out of this chamber and into the Douglas Fir Committee Room. There are a number of reasons for that, and I think it is a very progressive and positive reform. Most jurisdictions do not hold estimates in the chamber.
We are elected as legislators, first and foremost. Traditionally we have occupied this chamber for an inordinate length of time, believing that we are making some political points in the various estimates. The reality....
D. Lovick: You've never done that.
C. Serwa: How soon we forget, hon. members.
The reality is that we're mitigating our responsibilities as legislators, because we take an inordinate amount of time in this chamber on estimates, and then we run a number of bills through without proper scrutiny. The public has not been well served. We're staunch advocates that accountability will be first and foremost. It can be handled very effectively in the Douglas Fir Room. The permanent record of Hansard is kept in the Douglas Fir Room. There are opportunities for the future in the Douglas Fir Room that hold great promise for the whole process. The fact that it is in another chamber has created an entirely different atmosphere from the partisan-political atmosphere that occurs here. I found that the questions and responses were far more objective in nature than they tend to be in this very political arena. So, along with my caucus, I entirely and wholeheartedly support the motion put forward by the hon. Government House Leader.
D. Mitchell: In this House we all believe in parliamentary reform. Parliamentary reform requires trying new ideas from time to time. In the first session of this parliament a new idea was tried in this House. It was one that required a large degree of cooperation among all members in this House to try to make it work. It may not have worked perfectly, and I think more reform is required. In many of the most progressive parliaments in the Commonwealth today, all estimates are reviewed outside of the main legislative chamber in standing committees of the House so designated for that purpose.
We haven't gone quite that far, but we have made one step in the direction of change. We may not be completely satisfied with that, but the interesting experience that occurred in the first session of this House was that the debate that occurred -- the scrutiny that occurred for the spending estimates of certain
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ministries outside of this chamber, in Committee A -- was often much more detailed. The debate was better, the tenor of discussion was better, the scrutiny was more complete than anything we witnessed in this main legislative chamber, where members perhaps tend to grandstand somewhat.
Perhaps we need to think about parliamentary reform in the context of achieving scrutiny, achieving accountability of government. Perhaps that can best occur when we refer things outside of this chamber on a regular basis. That's not to say that we should ever allow this chamber to give up the power of control over the public purse. That will always be maintained, because supply bills must always come through this chamber. Supply bills must always be introduced into this House and debated in this full House. That maintains the element of control of the public purse that this chamber should always maintain and preserve as its right.
The Government House Leader's motion to replicate the process of last session is one that we should support. I would actually want to amend it further, but in the spirit of cooperation, I support the Government House Leader's motion. I would only make one suggestion. I noticed that when he outlined the membership on Committee A he didn't refer to membership of any independent members. I hope he will want to amend that, because I'm sure the House wouldn't want to disallow independent members from participating in that process.
With those few words, I wholeheartedly support the Government House Leader's motion.
K. Jones: Having been on the committee that sat in the Douglas Fir Room for a good part of the whole session, I participated with the House Leaders or representatives of the three parties in trying to address some of the very serious problems that were brought forward by that situation. We had no television or voice communication in that room, so people in their offices in this legislative precinct did not know what was going on in there. We had no public scrutiny. This estimates process is important. It's important for the public to see exactly what is going on. The people who can watch this on television and pick it up in the media know what is really going on within the ministries.
It is the real opportunity to know from the ministers exactly how they are going to spend their money this year. I don't think this government, or any person in this House, should take the stand that taxpayers have no right to know what's going on with their money. We have a public responsibility, in the process of freedom of information, to make sure that every part of the debate -- not only the Hansard process but also the visual accountability process -- relating to the analysis of what a ministry is spending is open to everyone. We have to see that the process of government is going on.
The government is taking this opportunity to try to hide their weak ministers from the scrutiny of television analysis, public analysis. By running these two concurrently, our research staff, which is hard-working but fairly limited, has great difficulty. They are not able to cover the workload without working extended hours. I don't think it is right for us to expect people to have to work overtime to do the amount of work required with double sittings such as these.
I definitely urge that this motion be turned down. It is not in the best interests of true parliamentary democracy, which we in this House stand for.
A. Cowie: I must rise in opposition to this motion and support our Opposition House Leader's position. I too took part in the debate in the Douglas For Room most of the time, although occasionally I was able to come in here. I found it very unsatisfactory when I missed part of a debate because I came in halfway through. I think it would be much better if we have it in one chamber. I agree that it is better to have it on television so that everybody from outside can participate if they want to.
For some of the speakers in the Douglas Fir Room -- even on our part, of course -- there was a lot of unnecessary duplication. I will admit that some of it was boring. If we were able to have it in the House, and if we were able to streamline it and come to some agreement on how we would manage it better, we would all be much better off and get through this thing much quicker than we did last year by having the two committees. I will be voting against the motion for that reason.
A. Warnke: I have been listening to a debate that has just broken out. I didn't expect this. As I reflect on the debate thus far, it is interesting that the last three or four speakers have been from the opposition side. Some of the government members want to get so enthusiastically involved in this debate, yet they don't stand up and essentially assert and affirm their own positions. I find that kind of puzzling, but there you go. Sometimes they cannot fully articulate on that side as to why they advocate the positions they do.
As I listen to the opposition express some concerns, I think it is worthwhile to suggest that what the opposition seems to be concerned about -- as put by my colleague from Surrey-Cloverdale -- is that the scrutiny that occurred in the Douglas Fir Room and the scrutiny that occurs in this chamber are conveyed quite differently, obviously, to the public in general. We have to recognize that what occurs in this chamber does extend to the public as a whole. That is not the case in the Douglas Fir Room. It seems, as I listen to the debate, that there is a concern that what occurs in the Douglas Fir Room will be concealed from the public to a greater extent than what is concealed in this chamber.
[4:15]
Some Hon. Members: Shame, shame!
A. Warnke: Since some enthusiastic government members want to get involved in this debate, perhaps they could suggest a resolution as to how we could move towards having the opposition define what is debated in estimates in the Douglas Fir Room. Indeed, if this government wants to be innovative and more open than it has in the past, then move in this direction to allow the opposition to define what is to be discussed in
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the Douglas Fir Room and what is to be discussed in this chamber, because it is in this chamber that the essence of the debate can occur.
Interjection.
A. Warnke: Well, hon. Speaker, here we go again: the enthusiastic government members want to get involved. To show just what kind of a person I am, since the hon. members on that side want to get involved in this debate, I shall take my seat now and see what, in fact, they do come up with.
W. Hurd: It's a pleasure to rise in my seat today and express my opposition to the motion before us in the House. I have to think back to the events in Committee A in the Douglas Fir Room last year, when we had the spectacle of perhaps six or seven deputy ministers, one or two members of the opposition and, at times, not a single member of the government other than the hon. member for North Vancouver-Lonsdale who, I'm glad to say, is here today and was a valuable contributor as a watchdog for the government in Committee A last year.
C. Tanner: Lap dog.
W. Hurd: But I might add, hon. Speaker, that he was the only one who was there.
C. Tanner: Was he lapping up the information?
Interjections.
W. Hurd: Hon. Speaker, I think it's a....
The Speaker: Order, please. One moment, please, hon. member. I would call the House to order. The hon. member for Surrey-White Rock has the floor at this time.
F. Garden: On a point of order, the previous speaker has made several comments alluding to the presence or absence of members in committees. I think he should consider his protocol at this time.
The Speaker: I recognize the Third Party House Leader. Is this on the point of order, hon. member?
C. Serwa: A point of order. I just heard on the news today of the announced state of the Liberal leadership campaign, but I do not think that the chamber is a place to initiate that campaign, and that's what I'm hearing at the present time.
The Speaker: That was not exactly on the point of order, hon. member. On the point of order, the Chair would remind all hon. members that at all times it is not the practice of the House to mention the presence or absence of members in the chamber.
W. Hurd: I must say I'm baffled that the third party in this Legislature would actually be supporting this motion. But I guess they haven't had a lot of practice in opposition in the past 20 years in this province, so I can understand.
I think it's significant to note that one of the most important innovations in this chamber in the past number of decades has been the introduction of television, which has allowed the people of the province to participate in all manner of debate in this assembly. And I think it's important for us to remember that during the course of estimates debate, when the television cameras are rolling, there is an opportunity for interest groups in this province to listen to the debate, particularly in areas that affect their businesses, their enterprises, their companies, their associations, and phone in to the official opposition and render their concerns about statements the minister has made. So there is an accountability beyond this chamber.
I think it's also important to note that this initiative of splitting the Committees of Supply into A and B might have worked before the government handed down two of the most outrageous budgets in the history of this province. It's absolutely essential, given the kind of budgets that this government is bringing down, that the people of the province are able to participate as a wider audience through the medium of television, which I think was one of the most important innovations in this chamber.
It's also important to realize that the government of the day has a budget of about $18 billion to $20 billion, and that compares to the budget for the official opposition of some $1.4 million. I think it rather significant that the members opposite who support this motion were the ones who, for whatever reason, were not questioning or scrutinizing the spending of the estimates of their own ministries.
Hon. Speaker, I speak against the motion. I believe it's a motion that did not work well for the people of the province last year. And any comparisons to the House of Commons, where they have 400 or 500 members, are irrelevant, because there are 75 members of this assembly, and there are 26 members in opposition. I believe that any government that professes to be open and honest would have no problem with debating Committee of Supply in this House -- what has occurred for the last who knows how many years. It was a good experiment, we tried our best, but it didn't work for the people of the province.
D. Lovick: It wasn't many months ago we had promises across this province that we would see a new, constructive, hard-hitting Liberal opposition. I put it to all members of this chamber, and to those people who are watching: this is constructive? This is hard-hitting? This silliness, this change of heart in less than one year seems to translate into one reason and one reason only. If you listen to the Liberal House Leader's comments, you discover the only argument is as follows: "We don't want to divide into Committee A and Committee B, because we aren't competent to do our job. Therefore give us a break." That's the argument.
We had a motion introduced in this chamber a little over a year ago, hon. Speaker, to divide into Committee A and Committee B to accelerate and do more efficiently the business of this House. The motion was adopted unanimously without debate. In less than a year, however....
Interjection.
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The Speaker: Order! Would the hon. member sit down. I must ask the hon. member for Surrey-Cloverdale to come to order; he has already taken his place in this debate.
D. Lovick: I think we could forgive the hon. member, hon. Speaker, because none of us really noticed he had taken part in the debate.
The fact, however, is that we have a change of heart, a miraculous conversion -- this miraculous recognition that somehow, in short order, "the system we as the opposition endorsed doesn't really work." And one is moved to speculate why that should be. What caused this change of heart? What led that group of 17 worthies -- or is it 16 now? -- to change their ways? And all one can think of -- at first blush at least -- is that it has something to do with television. Those people -- Marshall McLuhan notwithstanding -- haven't figured out that they don't look any better on TV than they do in Hansard. You don't make it. There may, of course, be other possible hypotheses to explain their change of heart. It could be that they don't want two committees going because if they have two committees, there could be two leadership candidates operating in each room, and that could cause them difficulties. But one ought to give them the benefit of the doubt and figure out what the real reason for their case is. In listening, I could not pick up a case.
I want to remind them of a couple of things they should know. When they are asking us to go back to the old way, they seem to be working on the assumption that we don't devote enough hours in this chamber as a government or as a parliament to discussion of estimates or to the normal business of the House. They might like to know a little of the history. They might like to know what has happened to debate in this province over the last number of years. For example, in the twenty-fifth parliament between 1957 and 1960, under W.A.C. Bennett, the Legislature met for an average of 34 days annually. The thirty-fourth parliament from 1968 to 1991, under Bill Vander Zalm, met for 74 days annually. The thirty-third parliament from 1983 to 1986 -- I'm sorry if I'm out of order; it might confuse them -- under Bill Bennett, met for 75 days annually. The thirty-second parliament from 1979 to 1982, under Bill Bennett, met for 76 sitting days. Take note that last year the House sat for 112 days, despite Committee A and Committee B. Given the beating that my friends opposite took in all the estimates debates I witnessed, one wonders how they could logically ask for more.
Another point I want to make -- albeit briefly, hon. Speaker -- is that the same official opposition that is crying and caterwauling about budgets and the public's ability to pay nevertheless wants us to return to a measure that will cost about twice as much. We achieved efficiency and effectiveness by the method of Committee A and Committee B. They now want to take us back.
I would submit, hon. Speaker, that they have presented an argument that doesn't bear up to any close scrutiny. They don't have a case. Rather, they're trying to demonstrate once and for all -- to counteract the bad press -- that they really are an opposition. Frankly, I think they make us all look rather silly by protracting this debate on what is, after all, a simple and straightforward matter.
G. Farrell-Collins: Hon. Speaker, I always enjoy following the member for Nanaimo because I can point out all the ridiculous comments he makes.
Today in question period, a little less than two hours ago, the Premier stood up in this House and answered for an expenditure that he undertook last night, which was to hire a satellite truck to park in front of the Legislature and broadcast a public relations sham to the people of this province, because he was too lazy to get out of his office and go to the Rogers Cable TV studio. We have a Premier who stands up and says something to the effect that he is an open and accessible Premier with an open and accessible government, and that he will never hesitate to use whatever expenditures are necessary to communicate directly with the public of British Columbia. Everyone in the NDP was hammering on their desks and cheering, hooting and hollering. And a little less than two hours later those same members, including the member for Nanaimo, stand up in this House and say: "Why would you ever want to analyze the budget expenditures of this government in front of a television set so that the people of this province can look at it and see what's going on?"
I sometimes wonder if these members actually think before they take a position on something, or if they just receive the memo from the House Leader -- or the former House Leader -- and react accordingly. I wonder if there's any independent thought going on on those benches at all. I have yet to see it.
We have the members of the Social Credit Party -- I can't believe it -- who introduced television to this Legislature.... In 1986 it was one of their campaign items: Premier Vander Zalm would bring television to this chamber. He finally got around to it in the last session of his government, when in fact he wasn't Premier anymore. The House Leader for the third party was one of those government members who endorsed television. He wanted to bring television in. It was going to be open government. It would open the doors to the public so that they could see what was going on; they could be part of the scrutiny that was going on in this province. This is the same Social Credit Party whose leader stood up less than an hour ago and said how important it was that the public know the disastrous budget that this government had brought in.
Two budgets in a row increased debt to the point where we have $23 billion worth of deficits in this province, accumulated to the point now that that's our debt. We have this government adding another $1.5 billion of operating deficit this year, and perhaps another $1 billion or $1.5 billion in other capital expenditures through the Crown corporations.
[4:30]
C. Serwa: You are a Liberal leadership candidate after all.
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G. Farrell-Collins: Well, hon. Speaker, we have the Social Credit members standing up and saying how important it is that the public be able to scrutinize every single penny of the government. This is the party of fiscal accountability, and we heard all the wonderful things they'd done. Yet less than an hour later they're standing up saying: "Let's take that scrutiny and shuffle it off into another place where the people can't see it, the people can't hear it, where the reporters aren't even there to see what's going on." They're saying one thing on one hand and another thing on the other hand.
It's also extremely interesting that the independent member for West Vancouver-Garibaldi would stand up and speak to this issue, because I know that at the end of the last session he wasn't very happy with the process. In fact, he spoke against it, and he said to the members of this caucus that it shouldn't continue. Yet today, he changes his mind. I wonder why?
Interjections.
The Speaker: Order, please, hon. members. I cannot hear the debate.
G. Farrell-Collins: The entertaining member for Nanaimo stood up and talked about the length of time this House sits. We sat for 35 days, and then we worked it up to 72 days. Perhaps that's because the budget of the province was rising. Perhaps that's because the expenditures of government were increasing and the size of government was increasing, and therefore it's more important that we take that extra time to scrutinize the types of things that the government has been doing. Perhaps, if he had been better at scrutinizing it when he was in opposition, we wouldn't have the mess that was left behind by the Social Credit government that his Premier talks about so much. Perhaps, if the House sat more often and if he participated in estimates as much as he now says he should, we would have better scrutiny. Perhaps, if that member had participated in estimates in the last year, we wouldn't have a $1.5 billion deficit now, because he would have taken his own ministers to task to cut expenditures and reduce taxes instead of increasing them. So perhaps he should listen to his own words.
At a time when the public is asking for greater access to government, at a time when the people of this country -- not just this country but the whole world, as a matter of fact; in the United States the same thing is going on -- are asking for better access to government.... They want to know how their money is being spent; they want to know how their taxes are being raised and why. After going through the referendum process we went through last year, where every single one of the government members was wrong and didn't listen to the public, the government hasn't learned a darn thing and is going to turn around and do just the opposite of what they promised. We have the Premier and 50 other NDP members in this House who campaigned on open government, and yet they want to take it and hide it. They want to take their weakest ministers and half of their budget deficit and they want to put them in the other chamber where nobody can see what happens.
The Social Credit members, the member for West Vancouver-Garibaldi, the member for Nanaimo and, in fact, the Government House Leader himself talked about how we have to be progressive and about how in the House of Commons in Ottawa, for example, all the estimates are done in committee. But there is great pressure on the House of Commons in Ottawa to televise those committee hearings, because the Canadian public don't know what the heck is going on with the way the government is spending money. Perhaps, if they hadn't moved them out of the chamber and if the public could look more closely, and if even those government backbenchers would be more responsible in scrutinizing the expenditures of the government, we wouldn't have the outrageous deficits we still have at the federal level.
Why would the Social Credit members, who brought television into the House -- a great innovation, a great progression -- side with the government to help them hide half of their deficit? Why would they do that?
An Hon. Member: There's nothing hidden.
G. Farrell-Collins: Well, they say there's nothing hidden. It seems to me that the same rationale that the Social Credit Party used to bring television to this House, the same rationale the Premier used last night when he talked about the budget on television, the same rationale that this government and the member for Nanaimo used in the last election campaign to bring open government to this province would apply in this case. Why not?
There is only one answer: this government is embarrassed; they are ashamed of their budget and of their spending, and they know that starting today and tomorrow and the next day, the opposition is going to look under every stone, to find every patronage appointment and to find every bureaucrat who's got a bonus, who's getting their car insurance or their golf fees paid for. We are going to find every single one of them; we are going to turn them over and expose this government's rampant, insulting and excessive spending. Because of that, they want to put it off in the other room so that nobody can see. That is the only reason for what this government is doing; it's the only reason why they would break their promise of open government; it's the only reason why the Premier would stand up a little over two hours ago and say one thing and then have his House Leader come in here and say something else.
There are problems with Committee A and Committee B. The former House Leader for the Liberal Party, who now sits as an independent, is aware of those problems. Social Credit members have complained about those problems. Specifically, they deal with the substitution process. It is difficult. It is my understanding that there are administrative problems with Hansard, with other parts of this House and with substituting members into that committee. Those haven't been worked out; there have been no discussions. There have been one meeting or two meetings, I
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believe, between the House Leaders to try and look at this thing, but they certainly haven't come to any solution. Yet the government goes ahead and does it without the agreement of the parties. Changes to the rules of this House only work when all parties agree, when there's unanimous consent and when it's in the best interest of the whole process.
This government has gone against those principles and against that tradition. The Social Credit Party, for some unknown reason, is siding with them. The government is breaking the promise they made to the public for open government. They are going against the comments the Premier made today. They are going backwards, not forwards. This motion should be defeated. We should ensure that the public has a chance to scrutinize what goes on in this House, especially today, the day after the NDP government has tabled the worst deficit in the history of this province, when they're going after a billion-dollar tax grab for the second year in a row. Today especially, the government backbenchers, the Social Credit Party of all people, and certainly the independent members should get behind us and defeat this motion.
M. Farnworth: I listened with interest to the comments of the previous speaker, and I feel that it's incumbent upon me to correct a number of the factual errors that he's made and to set the record straight. I intend to do that, and then perhaps speculate as to why they are so vehemently opposed to this commonsense resolution.
Last year, when we took over, we took over a Legislature which by and large had some very archaic methods of dealing with business. What we did, hon. Speaker, was look to legislatures across the country to see how they dealt with House business to see if there were ways that we could make the process more efficient; save money; involve the opposition parties in the consultative process; and at the same time ensure that the ability of the opposition, members of the press and the public to scrutinize government activities was not diminished.
D. Lovick: Did we succeed?
M. Farnworth: We most certainly did succeed, hon. member for Nanaimo. We established Committee A and Committee B, with agreement of the opposition parties -- complete with input from the opposition parties on deciding which ministries could go to which committees. That was consultation, hon. Speaker. The opposition was involved, and the whole process at all times was open to members of the press gallery, and the public, and was recorded by Hansard.
So, hon. Speaker, Hansard is there for every British Columbian to read. The opposition was free and able to ask their questions. I remember seeing all members of the opposition participating in the debates, as did many of the government backbenchers, by asking questions. The fascinating thing was, we got a lot of business done. There was an opportunity for members to go to different committees and to hear different ministries' estimates being debated and to ask questions.
The funny thing is, we took this Legislature, which had been operating on some rather archaic nineteenth-century precepts, and we brought it into line with just about every other Legislature in the country. We were one of the last Legislatures in the country to go to a dual-committee system. I'd like to point out to the member for Surrey-White Rock -- who said before that just because the federal government does it, that doesn't mean we should do it -- that if something works, it's worth looking at. If it can make a system more efficient, if we can deal with government business in a more efficient way, then that's what we should be doing. That's what this debate is about.
I have a real problem in trying to understand why the Liberal opposition would be opposed to the two committees this year. I mean, you've got Committee A and Committee B. There's one committee for each of their leaders. Leader A can go to Committee A and leader B can go to Committee B. Maybe that's what they're really concerned about.
An Hon. Member: Maybe they want Committee C.
M. Farnworth: That's right. Maybe they want Committee C for the member for Surrey-White Rock, and Committee D for the member for Richmond-Steveston when he declares. Maybe that's the problem. They don't like the idea of the leader in one committee overshadowing the leader in the other committee.
D. Lovick: You forgot the interim leader; he's feeling left out.
M. Farnworth: We wouldn't want the interim leader to feel left out.
It seems that they're more interested in their own internal divisions and problems than they are in the business of this House. The Social Credit caucus, with their one leader, is quite happy to try to work in two committees. Why is it so difficult for the Liberal Party? Could it be that their total leadership just doesn't measure up to working in one committee?
[4:45]
D. Lovick: It's possible.
M. Farnworth: I doubt if they could do that.
Hon. Speaker, I think I've made my point: we've got a system that works. It worked last year. It saves money, and it's more efficient. It's open and accessible to the press and to the public. The problem lies in the Liberal Party and their internal difficulties and the fact that they can't control what would happen with half of their caucus in one committee and half in the other committee.
L. Stephens: It's a pleasure for me to rise in opposition to this motion and to support the debate of my colleagues in the official opposition. This is another example of this NDP government's broken promises of open and honest government, which members opposite like to speak of so quickly and so often. This govern-
[ Page 4912 ]
ment likes to talk about open and honest government. The process last year was not efficient, as some members like to bring forward. In various debates on estimates last year in which a number of members participated, it did become tedious and repetitious. The member for Port Coquitlam and the member for Nanaimo are very familiar with tedious and repetitious debate. I would like to urge all members to defeat this motion.
F. Garden: Hon. Speaker, I find it rather strange to be taking part in this debate at this time; I thought we had this debate last year. I believed the Liberal opposition when we all came to the House -- many of us as new MLAs -- and they said: "We are prepared to cooperate. We want to get on with the business of government." I was really pleased when we were able to come to an agreement whereby the debates of this House would be split into two committees, and we went about our business. I can't recall once in the spring session or the fall session when a member of the opposition stood up and said that it wasn't working. I can't understand the dramatic change.
You can go through the debates in Hansard and you won't find any derogatory remarks about the process. As a matter of fact, I recall sitting in on the other committee, which I was not part of, and hearing the Liberal members going on ad nauseam during the estimates. One of the members of the opposition admitted today that they were boring, but they got the opportunity to debate the estimates fully. That was progressive, just as it was progressive in the makeup of the legislative committee work we did last year. That was given an expanded role. There was participation by the opposition, the independent members, the members of the third party and the members of government, and it was a good year for legislative committees. It was open and honest, and I can't understand why we're not here debating.
If the problem is that they're not getting on television often enough, because they can't afford it out of the money that is lent to them by their members, then by all means the debate here should be.... There should be better coverage in the committee. If the TV coverage is a problem, let's debate that. Let the House Leaders get together and talk this out. That's going to be kind of difficult because of the musical House Leaders we've seen in the opposition. We don't know who to talk to on these deals. But we did make deals, and there's absolutely no reason.... I applaud the independent member who stood up earlier and said that this is progressive change.
Interjection.
F. Garden: If you want to talk honestly about being open, tell the people your real reasons for wanting the change. I'm sure we're prepared to sit down and discuss proper coverage in the other committee with you. We don't want to be spending the hours in this Legislature dragging on in debate, as has gone on in the past. I don't know about the rest of the members in this House, but I want to spend as little time as possible dragging out these interminable debates. I want to be back in the riding and working for my constituents, as you should be.
But for some reason there's been a change in attitude. I sense it's strictly political. I don't want to accuse them of that; I just say that I sense it's strictly political. I'm convinced that if they're serious about some of the statements they've just made about openness, they'll sit down with us and get the debate going about proper coverage in that committee. Let's get on with the work. I'm proud of what we did last year. I'm proud of the opposition members. I'm proud of the real opposition -- the third party -- for the way they've cooperated and the way they seem to want to continue to cooperate this year. So let's get together. Let's get out and cut the rhetoric. The House Leaders should get together and discuss coverage, and let's go on with business. Stop this nonsense, and vote for this resolution that's before the House.
D. Symons: I found the previous speaker quite entertaining. Unfortunately, he's missed the point entirely -- missed the reason why this is not a good concept. And I'm not surprised that he's missed the point, because obviously he missed the point that we never debated estimates last November at all, and he made reference to the fact that we didn't complain about it then. It wasn't an issue at that time.
Just on one other point made by the member for Port Coquitlam. I wasn't here during the speakers before him. I was speaking to one of the members of the press, and I said: "In the House right now we are discussing Committee A and Committee B that we did last year." He said: "That didn't work very well for the press." So it seems that what you said is in contradiction to what the press have told me, hon. member for Port Coquitlam.
Where I find the difficulty with this is not with press coverage and not with the TV in the room here. As far as I'm concerned, you could turn that off. What I'm concerned about is due process. I'm concerned about the operation of it in an effective way that gives the opposition what it is supposed to have during estimates -- an opportunity to investigate and scrutinize the spending of this government.
I believe the basis of this decision, or the method the government is using, is simply a divide-and-conquer procedure. If the two sides of the House were somewhat in balance, as certainly we would find out from the voters of this province.... The percentage vote between the two parties was not very great, but the spread in this House is a three to one difference. That does mean, when we go into committees of this sort, that we are greatly outnumbered and disadvantaged. The government is pushing so hard for this because they want to disadvantage the opposition in their ability to scrutinize the accounts and spending habits of this government. I am against that. It is not a system that is going to work well.
When it was introduced last year, it was done so as an experiment -- and it was presented to us that way -- to see whether it would be more effective. Indeed, we entered into it in the spirit that it was presented: to look
[ Page 4913 ]
at this as an alternative way of doing the business of this House. Today we are not changing something that was brought in. It was brought in as a one-year trial. We tried it, and we find it wanting. For that reason I am against going back to what last year we found did not work.
H. De Jong: I'm not planning to belabour this very long, because I don't believe it warrants it. The main purpose of delving into the estimates is to get to know what the government is spending money on. This whole debate that has taken place this afternoon seems to have entered into party matters rather than matters of efficiency, which is why the trial period was introduced last year. The matter of efficiency, of course, comes in in terms of the time we spend in this Legislature. There is a cost attached to running this Legislature when it's in session -- there's no question about that. It would appear to me that the official opposition doesn't take that into account.
In previous years all of the debates on the estimates were held in this legislative chamber. I have sat through debates held in the committee room and in here, and much more time was spent on the estimates of ministries handled in the committee room last year than was spent in this legislative chamber in previous years. If in fact the official opposition feels that they did not gain the optimum out of the estimates last year, I don't think it can be blamed on the system; the blame for that lies somewhere else. Either their research staff did not give them proper information on what to ask questions about or they simply didn't have the courage or initiative to really get into the estimates as they had planned or would have liked to have done. So it's not a matter that there wasn't an opportunity to discuss, and surely this year will be no exception.
I don't take great pride in the budget that was brought down yesterday -- I don't think anyone on this side of the House does -- but that's beside the point. That's why we go into the estimates. Of course, in the days to come we will have the normal discussion here in the House on the entire budget. That's when we'll be discussing the global aspects of the budget.
Again, I do not believe that the people of British Columbia would be improperly served by the committee system that was instituted last year to deal with the estimates. But from a financial point of view, as well as from the point of view that they still can get the information, I believe they will be better served.
L. Reid: I stand before you, hon. Speaker, absolutely amazed that this is the same government that called for open, honest and forthright government. Where has that commitment gone? It's clearly not demonstrated today. The business of the people is done in this chamber; the business of government is done in those committee rooms. It is not necessarily the business of the people, and I will stand firmly behind that comment.
Taxation is a people issue. I believe British Columbians want to see where their tax dollars are going to go. If this government were truly proud of the budget they have brought forward, they would be prepared to stand in front of British Columbians every single day, for as long as this process takes, to defend something they suggested yesterday -- and continue to suggest today -- they are inherently proud of to take to the people. So I'm saying that if that's the case, take it forward. Stand in this chamber where the work of the people of British Columbia is done and stand behind what you presented yesterday.
[5:00]
I believe what was presented is a shocking budget, and I can well understand this government's wish to tie it up in very obscure committee rooms to deny British Columbians the opportunity of taking a very close look at it. Terms like "analysis" and "scrutiny" are not something that this government wishes to have shed upon that budget, because there are major holes in that budget.
Let's take health care as an example. We've not seen any of those numbers being brought forward to British Columbians. They have every right to expect that information. And if we're talking dollars, British Columbians have paid for this service and they will continue to pay for this service. I think they are getting a little tired of decisions such as the closure of the Shaughnessy Hospital emergency, where they paid $850,000 for a service that's never going to open.
Those kinds of issues have to be carried forward and they have to be, I believe, televised. That is the only opportunity British Columbians have for any kind of consultation. Because this government doesn't understand consultation. This government is prepared to say: "Let's talk after." They're not prepared to consult. I don't believe this government understands what that word means. Debate in this chamber may be the only consultation the average British Columbian hears about, is involved in, or is able to participate in -- which is shocking in itself, because this government prided itself on taking forward some kind of consultative process, and they have not delivered on that question.
We heard the member say: "We'll talk after the motion." The member for Cariboo North said: "We're now ready to discuss this issue. Perhaps the House Leaders can get together and discuss it." Again, consultation being offered after the fact. Why is that valuable? Why is that considered useful to anyone in this exercise?
The member for Abbotsford is concerned about dollars. He would do well to look at the obscene budget overruns in committee work in this province. An absolutely obscene amount of money has been frittered away.
The people in this province deserve to see this budget, and I suggest we go forward from here. I can speculate that every year we will see a worse budget. What will the people of British Columbia have to look forward to -- a smaller and smaller room with less and less scrutiny? It is not something I am prepared to accept for my constituents. This chamber is where the work of the province is done, where the work of the people of British Columbia is done, and I stand firmly behind it.
[ Page 4914 ]
Again, I put it out to the government: if they are as proud of the budget today as they were yesterday, they would not be putting forward this motion.
H. Giesbrecht: One would think with all this debate about TV coverage that the members of this House have some illusion that they affect the Nielsen ratings in a positive way. At least the opposition would appear to be thinking that way.
The problem here is that this issue is really about something quite basic. We debate all the budget estimates of 18 ministries and the Premier's office. We decided last year, instead of doing them all in this House and taking up an awful lot of time, to do them in two different places. Committee B was in this House; Committee A was in another place. Both are covered by Hansard. Unfortunately for the opposition, there's only TV in this place.
I was one of the people co-chairing or deputy-chairing Committee A, so I wasn't on TV. Quite frankly, no one called me and said: "Why aren't you debating the estimates on television?" Even my mother didn't phone to ask why I wasn't on television. It enabled us to go through the estimates efficiently and to save some time doing it.
I admit there are some problems for the opposition in this. Number one, the workload would obviously double because we're trying to do it in half the time. But I assure the members opposite that the workload doubles for all members of this House, so that's not really an issue. In fact, the taxpayer might appreciate that they're finally getting some of their money's worth. The other problem is that Committee A is not on television. The opposition would have us believe that they got thousands of letters from constituents saying: "Why aren't the Attorney General's estimates on television? Why aren't you debating the agricultural estimates on television?"
An Hon. Member: They didn't get one.
H. Giesbrecht: I don't believe they got one, as the hon. member says.
They also suggest that the only way for a government to be open and honest is by being on television. Is the federal government any more honest because it's continually on television? Was the previous administration any more open and honest because everything they did on all the estimates was on television? The member for Fort Langley-Aldergrove, even in that consideration, criticized the Premier for being on television and then argued that you have to be on television to be open and honest. Somehow there's an inconsistency, which I'm sure isn't going to wash with the public.
There is a third problem for the opposition. The opposition wants to be entertaining, and you can only be entertaining on television. But I submit that the cost of providing televised debates in Committee A is hardly worth the entertainment. I sit in this House regularly, and I can assure every member of the public that it's hardly worth the cost, and I'm sure they know it.
The odd thing is that after we finished the estimates last year, I don't recall a single statement by a member of the official opposition that it wasn't a good way to deal with the business. Not a comment. Yet they would have you believe that they got thousands of requests demanding that they do all the estimates, all the intricacies of each ministry's budget, on television. I wish I had some of the questions asked at those debates to give you an example of the kind of detail we went into.
The suggestion that the public is clamouring for more coverage of the opposition's performance is ludicrous in the extreme.
An Hon. Member: They're looking for a soap opera.
H. Giesbrecht: I think possibly they're looking for a soap opera.
The member for Cariboo North said it well, and I think it bears repeating in another way. Don't the Liberals have constituents to serve in their constituencies? Don't they have families they want to spend some quality time with? Do they really think that entertaining here on TV is the only way to serve British Columbians?
The issue is about television coverage in one part of the estimates. It's about efficiency. It has nothing to do with the smokescreen that the opposition is laying out for everybody. Plain and simple. Hon. Speaker, I support the motion.
Hon. G. Clark: I apologize for my tardiness, but I couldn't resist speaking on this motion. As the former Government House Leader, I negotiated with the former Opposition House Leader and the House Leader for the third party a new and innovative approach to parliamentary democracy where we could actually get into committee and debate the business of government in a non-partisan way. It was in that spirit of cooperation that the new government and the new opposition -- who campaigned on a more constructive approach to government -- struck these new and innovative rules.
I'm proud to say that the third party and the former House Leader are still supportive of a new way of doing business with public money: ending the kind of trivial partisanship we've seen today from this so-called new opposition mentality that will stand up here and engage in petty debate instead of rolling up their sleeves and getting down to the business of government. Every other civilized democracy spends time scrutinizing line-by-line the debates -- the spending estimates of government -- and that's how you get good government. You don't get it by engaging in silly, partisan rhetoric. We thought the opposition campaigned on that in the last election. It is most disturbing, hon. Speaker, I'm sure for most British Columbians, to see today this kind of petty display of partisanship on such an important issue of parliamentary democracy.
The last year's reforms of this parliament enhanced the quality of the debate, and they haven't gone far enough. If we've learned anything from last year, it's that we can refine the committees of parliament. And we can do even better by continuing to use them: by continuing to hear the people of British Columbia's
[ Page 4915 ]
comments; by opening up this chamber so that citizens of British Columbia can scrutinize and question members of the executive council, or indeed all members of the Legislature.
We're proud of the fact that we had parliamentary committees talking around this province about vital health statutes. We had parliamentary committees travelling this province talking about parliamentary reform. We had parliamentary committees talking about how to get more jobs from our forest industry. Members of the Liberal Party are standing up today and complaining about the budget for parliamentary committees that travel the province and hear the people of British Columbia. I say shame on them.
This is a new and more open way of doing business, and I'm delighted that we're continuing the reform that was begun last year. I look forward to continuing to modernize this rather archaic parliamentary procedure so we can hear private members represent their constituency interests. If we can downplay this kind of silly partisan rhetoric, roll up our sleeves and work on behalf of the people of British Columbia, I support this motion. I'm sure the majority of the members of the House support moving in that more positive and constructive direction.
V. Anderson: I hadn't intended to speak on this particular motion, but I couldn't help but follow the Minister of Finance, particularly when he mentioned the phrase: "if we have learned anything." I'm not sure the Minister of Finance has learned anything. We have the same rhetoric that we had from him a year ago; it does not change. He enjoys it, and I appreciate his enjoyment of it. He has the same ability to try and confuse the public. When we are talking about Committee of Supply, he wants to talk about legislative committees. He wants to wander over the topic and all over the block in his conversation. I think that we need to call him to account in this kind of presentation.
I'm also amazed that the Minister of Finance, and other ministers on the NDP side of the House, would suggest that in the Committee of Supply in the Douglas Fir Room they have the opportunity to speak as private members, but they do not have the opportunity to speak thus in this Legislature. I find the suggestion that they cannot speak here equally as well as they can in that other room very startling. We have that very concern: that the freedom of this House has somehow been caged in by the government, and that they only have to go into the smaller room, which is not large enough to hold all of the people of this House. In fact, unless you are a part of that designated committee, you're not even allowed to sit in the room as a participant. It's one way of excluding people from that discussion. The whole process of trying to balance the activities of this House in that committee is unfortunate, because its very operation closes down and limits discussion, debate and accountability.
Of course, if this government is honest and open about this, that's one thing. But when they try to disguise this in the name of democracy and open government, that's something completely different. I think the public is very much aware, and becoming more aware, that this government talks about openness and consultation, but they do not talk about accountability. This is just one more case of trying to hide their agenda, which they are trying to force upon the unsuspecting citizens, from the people of this province.
[5:15]
I must join with my colleagues in voting against this motion and in protesting the action of this dominating government.
The Speaker: Seeing no further speakers, I will now call the vote on the motion.
Motion approved on the following division:
|
YEAS -- 46 | ||
|
Petter |
Perry |
Marzari |
|
Boone |
Priddy |
Edwards |
|
Cashore |
Charbonneau |
Pement |
|
Beattie |
Schreck |
Lortie |
|
Lali |
Giesbrecht |
Conroy |
|
Miller |
Smallwood |
Hagen |
|
Harcourt |
Gabelmann |
Sihota |
|
Clark |
Cull |
Zirnhelt |
|
Blencoe |
Barnes |
MacPhail |
|
B. Jones |
Lovick |
Farnworth |
|
Dosanjh |
Doyle |
Hartley |
|
Streifel |
Lord |
Garden |
|
Kasper |
Simpson |
Brewin |
|
Janssen |
Mitchell |
Serwa |
|
Weisgerber |
Hanson |
De Jong |
|
Neufeld | ||
|
NAYS -- 12 | ||
|
Chisholm |
Cowie |
Reid |
|
Dalton |
Farrell-Collins |
Stephens |
|
K. Jones |
Anderson |
Warnke |
|
Hurd |
Tanner |
Symons |
Hon. G. Clark presented a message from His Honour the Lieutenant-Governor: a bill intituled Supply Act (No. 1), 1993.
Hon. G. Clark: This supply bill is introduced to provide supply for the continuation of government programs until the government's estimates for 1993-94 have been debated and voted upon in this assembly. The bill will provide interim supply for the initial three months of the 1993-94 fiscal year; this will allow time to debate and pass the estimates.
As 1992-93 supply will expire shortly, interim supply is urgently required so that a variety of essential payments to GAIN recipients, hospitals, school districts, universities and social agencies, as well as the government's payroll -- and MLAs' payroll -- may continue uninterrupted. Therefore, in moving introduction and first reading of this bill, I ask that it be
[ Page 4916 ]
considered as urgent under standing order 81 and be permitted to be advanced through all stages this day.
I move that Bill 9 be introduced and read a first time now.
Motion approved.
Hon. G. Clark: I ask that Bill 9 be considered as urgent under standing order 81 and be permitted to advance through all stages this day.
D. Symons: I question the problem the government mentions about this being urgent. They knew before today that March 31 was coming up. Maybe they haven't noticed the calendar. If something was urgent or pressing, it could indeed have been brought before this House earlier than one-half hour before the usual closing time when they're going to discuss a large amount of money. I would think then it does not fit under standing order 81, in that urgent should be brought before the House when it is discovered and not at the last moment. I wish the member would explain the urgency and the lateness of bringing it before this House.
The Speaker: Thank you for the submission, hon. member. There is no opportunity for a debate here; it is up to the Chair in this instance. The Chair does accept the submission of the Minister of Finance. It is the Chair's opinion that standing order 81 would apply in this instance.
Hon. G. Clark: Hon. Speaker, before moving second reading, I would ask whether you could adjourn, at least for a couple of minutes, so that the bill could be distributed.
The Speaker: We will have a brief recess to allow the bill to be distributed among the members.
The House recessed at 5:28 p.m.
The House resumed at 5:30 p.m.
HON. G. CLARK: I move that the bill now be read a second time.
Hon. Speaker, this supply bill is in the general form of previous supply bills. As required by the Financial Administration Act, special warrants are included in this bill. Schedule 1 lists those approved for the 1992-93 fiscal year. The first section of the bill requests one-quarter of the tabled estimates to provide for the general programs of the government. The second section requests the disbursement amount required for the government's voted financing transactions, which appear in schedule C of the estimates. The third section requests an amount of $28 million in the statutory authority for the Purchasing Commission working capital account to permit an increase in the delivery of goods and services provided through this account.
Finally I point out the requirement for early passage of the supply bill to provide for the ongoing expenditures of the government for the 1993-94 fiscal year.
I move second reading of Bill 9.
Motion approved.
Bill 9, Supply Act (No. 1) 1993, read a second time and referred to a Committee of the Whole House for consideration forthwith.
SUPPLY ACT (No. 1) 1993
The House in committee on Bill 9; E. Barnes in the chair.
A. Warnke: I would seek some clarification from the Chair. I take it that vote 21 and the emergency assistance is to be addressed now. Is that correct?
Hon. G. Clark: For members of the House -- we've been away from these things for a little while -- how we proceed in committee would be to go through the sections -- section 1, section 2, section 3 -- and in each one of those sections there are discrete things which obviously can be questioned. Then we move to the schedule, which is a separate vote. As is the custom of this place, I propose that we move separately through the various warrants -- of which there are six -- not to vote on, but for the purposes of debate and discussion, so that ministers who are being questioned can bring in staff at that time, as would be appropriate. I think that's in keeping with the tradition of the House, hon. Chair, and if it helps the House, it gives some clarification of how we might proceed.
The Chair: Thank you, hon. minister. Your explanation is quite appropriate and it saves me from having to do it myself.
On Section 1.
H. De Jong: Mr. Chairman, I'm not quite clear on section 1. Normally, I believe, the method of providing interim funding would be based on the previous year's expenditures. It would appear to me that under section 1 it's based on the estimates of this year, which have not been up for debate in this House as such. I'm just wondering if this is perhaps a misprint in the bill, or whether the government is really trying to do this on the basis of this year's budget, which seems out of place, as far as I'm concerned, because the estimates have not been discussed.
Hon. G. Clark: Hon. Chair, my understanding is that it's been done both ways, depending on when the interim supply bill is brought in. This interim supply bill was brought in after the budget. It seems prudent to have three months' spending of the budget as approved in an interim way while we debate the estimates of the House. If we were to do it on a quarter of the last year's budget, then it simply means that we would be approving 23/4 months supply in the House. I don't think it's a debatable point. We're just trying to approve in an interim way three months' spending to take us through the kind of proper debate that I know the
[ Page 4917 ]
opposition is looking forward to, and so is the government, in terms of detailed examination of the estimates of the House.
H. De Jong: I don't want to belabour this point, Mr. Chairman. But perhaps I haven't made myself clear in total. The proposed budget and the proposed estimates of each ministry have not been discussed in detail. The government is asking us to approve an expenditure related to the total budget, which we haven't discussed. I would think that the proper procedure would be that expenditures can continue on the level that was discussed last year -- based on last year's estimates rather than on this year's, which haven't been discussed.
The Chair: The Chair appreciates the wishes of the hon. member, but it has been the custom to discuss the interim supply bill based on the current estimates. The hon. member may wish from time to time to make reference to the previous fiscal expenditures, and as long as he's in order that will be allowed. But the Chair would rule that we proceed with section 1 based on the current budget.
Sections 1 to 3 inclusive approved.
On the schedule.
A. Warnke: I guess after a whole year it's good to be back and to do all kinds of neat things. On this particular vote 21, the warrant No. 1, I would like to ask the Attorney General -- his staff is coming in -- some questions, but I will wait until staff are entirely in if that's okay, hon. Chair.
The Chair: That's fine, hon. member. The hon. member for Richmond-Steveston continues on warrant 1 of the schedule.
A. Warnke: Essentially, vote 21 in the estimates for the fiscal year ending March 31, 1993, provided the sum of $803,500, which incidentally is the same figure that appeared in the estimates for the previous fiscal year. We now find ourselves with insufficient funding. Even though it involves $325,000, which is perhaps minuscule compared to the budget as a whole, I would nonetheless appreciate it if the Attorney General could outline the breakdown of the extra $325,000.
Hon. C. Gabelmann: I asked the same question myself, as to whether any outstanding amount caused this particular expenditure. In fact, there is no significant single item. A fair amount of search-and-rescue activity occurred during the past fiscal year.
Just for the member's interest, and given the reference to the previous year's estimates, it's very difficult to budget an item like this. It is really difficult to know how much money will be spent on emergency assistance in the year to come. For example, in 1988-89 the budget was approximately $2.5 million, and the expenditure was $0.5 million. In the next year the same figure of $2.5 million was used in the budget, and expenditure was about $1.1 million. Then the budget figure went down -- they cut it in half, essentially -- to $1.2 million in 1990-91, and the expenditure was about $912,000, so they got closer. In the last two years the proposed amount was $803,500, as the member has noted. In 1991-92 the expenditure was pretty close: $900,000. There was a difference of just under $100,000. In the past year the difference, as the member has noted, was $325,000. There's no particular item; it's a function of search-and-rescue activities and other activities of emergency assistance.
A. Warnke: I thank the Attorney General for his response. I'll follow with a few questions on this. Since search and rescue was at least one significant component of it, perhaps the Attorney General could briefly outline why search and rescue seems to be contributing to this insufficient funding, compared to previous years. Is there any reason for that?
Hon. C. Gabelmann: So as to not leave the wrong impression, it's not just search and rescue, of course; it's dangerous goods cleanup response and that kind of activity as well. I'm not able to say now how many incidents there were; I don't think we have that information. If the member wants it, we can provide it at another time. In the scheme of things -- we're pulling a C.D. Howe -- this is not a lot of money, and a lot of small issues contribute to it.
A. Warnke: The answer is satisfactory to me. As a matter of fact, perhaps another time to explore this would be during estimates. We can flag this now for the estimates later.
With your indulgence, hon. Chair, there is another question that is begging here. Given the fluctuations and problems here about the figure of $803,500 and since the ministry has found itself short in this particular case, maybe the minister could outline whether that is being anticipated in any way for the coming fiscal year. But let's leave that for estimates; I think that's most appropriate. I'm just raising that question to help out the staff. That is a question I could address later.
I am curious as to whether firefighting somehow contributes to insufficient funding. I cannot recall what the situation was last summer, but I'm just wondering whether firefighting has contributed to this as well.
[5:45]
Hon. C. Gabelmann: The provincial emergency program will respond in the very first instance if there's an emergency or if there's a fire that creates a potential emergency situation. But that's just at the very first instance, and then they pull out and the Forests ministry would take over if it were a forest fire, or whatever.
A. Warnke: In the original vote 19, where there was a breakdown in the ministry operations, I believe that the original figure of $803,500 appeared under emergency assistance. Since that is under vote 21, here's where the figure comes from, and yet there are actually a couple of other areas in which emergency assistance is kind of addressed. The minister did mention the
[ Page 4918 ]
provincial emergency program and others. I'm wondering if there was any shift of moneys from one emergency program to another, especially when one takes flooding and that sort of thing into account. If there's a problem here.... I understand the minister, but I would just like to explore, where there's a shortage in moneys for emergency assistance, whether that can be made up in another way.
Hon. C. Gabelmann: The answer is there. No, there's no transfer of funding. The flood relief financial assistance is a statutory program, and if money is paid out, it doesn't show up by way of special warrants. It's statutory authority. It's the same with forest fire programming; there's an obligation there. The moneys are segregated and separate, and there's no transfer from one account or one authority to another.
A. Warnke: There is another question I'd like to pose to the minister. Is there anything here in which we might expect some recovery of moneys? Obviously some moneys have been expended for search and rescue -- as one example among many -- but are there any procedures here that may allow us to recover some money to cover this?
Hon. C. Gabelmann: The member alludes to or hints at an interesting discussion. At the present time there is no recovery. There's no source of recovery for search and rescue activities, for example. There has been a fair amount of public discussion around skiers who ski out of bounds in a ski area and become lost, or whatever, as to whether they should be involved in....
C. Tanner: Particularly skiers.
Hon. C. Gabelmann: Particularly skiers, yes. We don't ski out of bounds, though.
There are some public policy questions around this issue, but the answer in terms of this particular warrant is no. There are no recoveries.
A. Warnke: I appreciate the Attorney General's response by giving both a general answer and a very specific one. Certainly it's most satisfactory.
At this stage perhaps there are others who want to ask questions.
W. Hurd: Just a quick question about the response capabilities supplied in the event of forest fires in the province. I would assume that's a relatively small financial commitment by the ministry, but what kind of dollar figures might we be dealing with for search and rescue providing an initial response to a forest fire in the province, particularly since it was a tough year in that particular ministry last year?
Hon. C. Gabelmann: I can't give any figures at this point, but I can say to members of the House that in this total $1.1 million, the amount that would involve forest fires would be very small. I was tempted to say negligible, but it's almost nothing.
V. Anderson: I'm just curious to know, with the awareness of earthquake preparations and emergency preparedness that has been developing in the province, whether any of that is covered in this estimate.
Hon. C. Gabelmann: No, earthquake preparedness and response are in the main vote. We'll have an opportunity during the estimates to debate that if you want.
On warrant 2.
A. Warnke: Again, the second warrant essentially involves another shortfall. One can understand this in the context of the amount of money that was estimated for the fiscal year ending March 31, 1993: $719,300,245. What we're looking at here is a shortfall, or insufficient funding, of $18.433 million. Once again, in the context of the overall amount of $719 million-plus, the percentage is not significant -- or it doesn't appear to be. Still, we cannot take the attitude "What's $18 million?"
We do want to explore where the more than $18 million is needed. Therefore I would appreciate it if the Attorney General could give us a breakdown as to where the money is needed. As I count them, there are about five different areas outlined in the order. I was wondering first of all whether the Attorney General could give us a breakdown in these five general categories. Then we'll explore each of the categories seriatim.
Hon. C. Gabelmann: The member obviously has the order-in-council that refers to the five areas. For the information of all members of the House -- because everybody doesn't have the order in front of them -- the biggest chunk of this $18 million plus is $15.49 million for legal aid; $760,000 for systems -- a variety of systems issues, and also some equipment at the Robson Square courthouse; $1.26 million for the implementation of the lawyers' salary settlement that occurred late in the year; $60,000 for the judicial compensation committee -- that is, Provincial Court judges; and $870,000 as part of an initiative to collect unpaid fines. Incidentally, the expenditure of that $870,000 resulted in additional revenue of some $13 million in unpaid fines that we collected. The $870,000 was not foreseen in the estimates at the beginning of the year, because the whole question of developing programs to deal with unpaid fines occurred during the fiscal year. It was an outstanding expenditure, given the result. Does that answer the question?
A. Warnke: I particularly noticed that there was a shortage in collecting fines. I believe it was the hon. member for Chilliwack who asked a question a year ago about uncollected fines and that sort of thing. I believe that it was around $60 million at the time; I'm not sure.
Interjections.
A. Warnke: Thank you very much.
I'd like to seek some clarification as well on the compensation package to Provincial Court judges.
[ Page 4919 ]
Would the Attorney General clarify the role of the judicial compensation committee?
Hon. C. Gabelmann: The Provincial Court Act sets out a procedure by which Provincial Court judges have their compensation and remuneration set in general. Without going through all the details, essentially it is a process that is embarked upon every two years. A judicial compensation committee is established. It includes no lawyers in its membership. That committee makes recommendations and the Provincial Court Act requires that those recommendations be presented to a legislative committee, and proceed from there through a ratification process. So that's the process, and the $60,000 is to pay for the cost of conducting the review by the compensation committee.
Anticipating the next question, this money was not included in the estimates last year. There was, at that time, a sense that another method of resolving the issue of compensation for judges could have been developed. As it turned out, events were such that we proceeded under the old system. The decision to do that was made during the fiscal year. At the time of the budget-setting last year, there was a thought that we could do it another way, but we've not had that opportunity.
A. Warnke: Thank you, hon. Chair, and I also want to thank the Attorney General for anticipating the next question. I believe a colleague of mine also has a question to put forward.
C. Tanner: I understand the investment in picking up the unclaimed amount of the fines, and it seems to me that you were looking for $60 million last year in unclaimed fines. You've picked up $13 million. What do you anticipate for the balance?
Hon. C. Gabelmann: I can't give you an answer to that question at this stage. It's an issue that I would be happy to pursue during the main estimates debate for the coming year's budget. Just say that we recognized early in our tenure that there was a significant problem with unpaid fines, mostly motor vehicle, but others too. We established a committee in the ministry to deal with fine collection. A variety of solutions were proposed. One of the solutions included a simple dunning letter: a letter to people who hadn't paid with an opportunity for them to pay by VISA or MasterCard. That dunning letter, with that opportunity to pay by credit card, is what cost the $870,000, and that part of the overall project is what we're talking about here. The $13 million is what came as a result of that initiative. The hon. member should know that there are a variety of other initiatives underway as well.
C. Tanner: You are spending about 8 percent to recover that sort of money, which is not unreasonable, but the first blush of guilt that makes a person pay those fines is the easy money to get. From here on in, it's going to cost you at least 20 percent. How far is the minister prepared to go on a percentage basis before he cuts it off? During the estimates, will he be reporting the sort of recoveries he's experienced since these figures came out?
Hon. C. Gabelmann: It's not appropriate in this set of special warrant discussions to talk about the broader initiatives. I will be happy to do that during the year. There are more initiatives coming than simply sending dunning letters. I would agree that if we were to send another dunning letter, we wouldn't get the same kind of ratio. There are other initiatives which we think in the long term will be more successful than what we've had heretofore in terms of keeping current with fine collection.
C. Tanner: Mr. Minister, I appreciate the four other categories, but the one that really astounds me is $15.4 million in legal aid. Did you underestimate that so seriously? Did your officials in the department underestimate that so seriously? Did the recoveries that you made come from the legal aid tax that the Minister of Finance charged? Was the problem that you didn't collect enough from that? You told us in the House the last time, last year, that you were going to take 6 percent on lawyers' bills specifically for this reason. When you found that what you'd done last year was illegal, according to the courts, and you're trying to rectify it now.... Are we being asked to recommend this payment for the shortfall in what you recovered? Or were you so badly out in your estimates in the first place?
Hon. C. Gabelmann: Given, hon. Chair, that the legal aid issue deserves a fair exchange of comment, and given that the House Leader wants to do something else at this point, I'll get back to that later.
[6:00]
Hon. M. Sihota: I move that the committee rise, report progress and ask leave to sit again.
Motion approved.
The House resumed; the Speaker in the chair.
The committee, having reported progress, was granted leave to sit again.
Hon. M. Sihota: Hon. Speaker, I move that the House at its rising stand recessed for five minutes.
Motion approved.
The House recessed at 6:02 p.m.
The House resumed at 6:07 p.m.
Hon. M. Sihota: I call committee on Bill 9.
SUPPLY ACT (No. 1), 1993
(continued)
The House in committee on Bill 9; E. Barnes in the chair.
[ Page 4920 ]
The Chair: We are going to proceed to warrant 3. I understand that, by agreement, we will return to warrant 2.
A. Warnke: I'll just go through this very quickly. Perhaps we could just go by warrant 2. I understand that there is some urgency for addressing some of the other warrants first, if that is all right with the Chair.
The Chair: That's correct. We will, by agreement, return to warrant 2. At the present time we will go on to warrant 3, which deals with the Ministry of Education.
On warrant 3.
J. Dalton: Perhaps just a preliminary comment -- not to be critical. It certainly would have been more helpful to members on this side if the ministers could have been available, without having other things interfere with their schedules. However, we will press on. I don't intend to be long at all in my comments.
It is of particular interest to me that at this stage the independent school grants are higher than the anticipated increase in student enrolment. I would like to ask the minister whether or not these unanticipated increases were projected in some way earlier in the year. Was this increase so sudden that we had to go over budget in that vote by $2,600,000? That amount does surprise me somewhat.
Hon. A. Hagen: I would like to thank all members for accommodating the fact that I have an important meeting in my riding tonight.
To the member, each year we project, to the very best of our ability, the enrolments in the K to 12 system. As a principle, the students who arrive at the schools will be funded, and if the estimates that we bring forward at this time of the year are inadequate, then we must deal with those through a special warrant. This is the first opportunity that those have had to come forward. Those enrolments accommodate the fiscal year. We have events throughout the whole year, and with the independent schools the funding is there over a period of time.
J. Dalton: It's probably going to be the case that I'll be pursuing this topic in more detail during the estimates, so I don't want to belabour a point. But I thought I might share with the minister some experience that I have actually had with people in my own neighbourhood and communities. They are very seriously looking at the independent school movement, and I presume that this amount of money that you've gone over budget would reflect that very serious and quite pointed interest in the independent school movement. That's not a point of criticism, I can assure the minister; that's just a fact. I've also had some meetings with independent school headmasters who've made similar observations. So perhaps it might be helpful for all of us to try and anticipate this sort of experience in the years ahead. And I hope the experience is not going to reflect adversely on the public school system.
The Chair: Order, please, hon. member. Just a moment. I would like to ask the committee to please keep their conversations at a moderate level, so that the Chair can hear what the member is saying. Would the hon. member please continue.
J. Dalton: I will conclude my remarks. This is certainly a very important topic, and it must be expanded upon further. Estimates, which will be coming up shortly, are the appropriate vehicle in which to do that.
W. Hurd: Just as a point of clarification by the minister about level 3 of independent school funding: is that a denominational type of school? It's my understanding that funding for that level was reduced during the last fiscal year. I was wondering what types of independent schools we're dealing with under special warrant 3.
Hon. A. Hagen: There are three classifications of schools in the Independent School Act which receive funding. In terms of the special warrant, there has been a decrease in the number of students in group 2 and group 3 schools and an increase in the number of students in group 1 schools. The warrant is directly related to the enrolment in each of those three groups.
W. Hurd: I have a question about forecasting. Obviously the exchange of information between the ministry and the operators of private schools.... A question could be asked about whether the minister feels that the appropriate level of communication exists about funding requirements for independent schools, given the fact that we are dealing with a fairly significant overrun in the ministry. Is the minister satisfied that the appropriate level of communication about funding exists between her ministry and the private schools in the province?
[6:15]
Hon. A. Hagen: Yes, I am satisfied that there is excellent communication between our ministry and the schools. Projecting enrolments in all areas is a somewhat inexact science, and I am constantly amazed at how accurate we are most of the time at projecting, in cooperation with the schools.
On warrant 2 (continued).
Hon. C. Gabelmann: I thought it might be more helpful if I began with the answer to the member for Saanich North and the Islands.
The legal aid budget in this year, of which today was the last day, was $71.5 million. In the previous fiscal year the budget was approximately $50 million, which was overrun by $4 million or so which was carried over into the fiscal year we're just ending. The volume increases that the Legal Services Society was dealing with earlier in the year had us concerned that the $71.5 million would be short by as much as $28 million or $30 million. We were concerned earlier in the year that the
[ Page 4921 ]
expenditure might reach $100 million or even $102 million.
The ability to estimate, to forecast, is not an exact science and has been needing some refinement, which is underway to the point where hopefully we're now going to be in a position to be better able to forecast volumes. The volumes that did ensue during the year reduced beyond what we saw coming during the year.... This is a convoluted way to say something that's actually simple; I'm making it sound very complicated.
An Hon. Member: You got rid of the Plain Language Institute.
Hon. C. Gabelmann: No, we actually brought it into the government so that it can start dealing with some of us.
I need to correct something that I said, before I go any further. Last year, instead of the $4 million I indicated, it was actually $12.7 million. That left the society with a deficit of $4 million for some reason -- which, if members are interested, I'll find out and give more precise answers.
Let me start again. Last year $50 million was budgeted. There was a special warrant of $12.7 million, leaving -- even after that -- a $4 million deficit. The $4 million deficit was carried over into this fiscal year that we're just finishing. The budget was $71.5 million; the actual expenditures were estimated to be $15.49 million beyond the $71.5 million. So, having confused everybody, I think the simple answer is that this year the budget was $71.5 million and the expenditures were $15.5 million beyond that.
During the course of last year I commissioned a report on legal aid which was released in September, if my memory is correct. A number of changes have been made at the Legal Services Society in response to that report, and further consideration is being given to it. We'll have an opportunity to talk about those issues in the estimates later this year. Simply put, the cost of providing legal aid last year was some $15 million more than we budgeted for.
C. Tanner: I just want to express my dissatisfaction with the process we're going through tonight. This afternoon we had a debate about whether we wanted to continue the discussion of estimates in this House, and the members opposite made a strong case that we should have two Houses. Here we are tonight discussing over $100 million that the government wants to spend, and it can't even get its ministers organized to be in the House to answer our questions. The answers we're getting are vague. We are expected to ask the questions when they're not even here to answer them. Mr. Chairman, I don't think that's good enough. If that's an illustration of the way this government is going to answer the estimates in the future, it won't do.
Interjections.
C. Tanner: Four of them are supposed to be here, not one.
An Hon. Member: The invisible minister.
C. Tanner: There are three invisible ministers. Maybe you can't count.
In fact, from the estimated costs plus the $5 million you added last year, you've gone up by $21 million this year over last year, with all your additions and so forth. In other words, last year it was $50 million plus $12 million plus $4 million, which is $66 million. This year it's $57.1 million plus $15.9 million, so you've gone up.... My figures are approximate, but they're not too far from what you told me, Mr. Minister. In other words, we've had.... Am I right, Mr. Minister?
Hon. C. Gabelmann: The budget in the previous year was $38 million. Your confusion is my fault. Before we get carried away here, let me say that I.... No, one can't use that term. Can I say that I misled the House? I didn't do it deliberately, though.
The budget was $38 million in the previous year. There was a $12.7 million special warrant, taking it to $50 million. An additional $4 million was a deficit position for the society in that year. Last year's budget set the amount at $71.5 million. Clearly, there was still the $4.5 million they had to pick up from the previous year. So the budget anticipated an approximately $67 million expenditure in the past year for legal aid. In fact, the expenditure was more than that by some $15 million.
As far as the ministers being here to answer questions, we're all going to be here to answer all the questions.
C. Tanner: I congratulate the minister on having a growth industry. It's really expanding very quickly. I asked you before -- and I've got a couple of other questions on the same subject -- whether any of that money was recovered. Was the money recovered from the 6 percent tax on lawyers' fees attributed directly to this vote, as the Minister of Finance indicated it was going to be? And did the fact that you had a shortfall because the courts found that you were ultra vires have any effect on the fact that you're here today for some more money?
Hon. C. Gabelmann: The answer to the second question is no; there's no connection whatsoever.
The answer to the first question is that the provincial sales tax -- the 6 percent social service tax that was levied by the Minister of Finance this past year -- went directly into general revenue. General revenue supplies this budget figure. One could make a connection if one wanted to, but all moneys come into general revenue and are expended from there.
C. Tanner: That wasn't the case the Minister of Finance made during the estimates last year, but I assumed that that's where it was going to go -- into general revenue -- and so did everybody else on this side.
I have two questions. When the minister found that this part of his budget was expanding quickly, what measures did he take to bring in some controls?
[ Page 4922 ]
Hon. C. Gabelmann: Very early on I asked Mr. Tim Agg to do a full and thorough review of legal aid in this province. That's the first thing. The second thing members need to know is that the Legal Services Society operates independently from government. We don't have a public defender system in British Columbia, nor will we have one under this government. We have legal aid provided by an independent society which is given a budget that it tries to operate within. However, it has a legislated requirement to provide service to people who qualify for legal aid. Therefore the amount is driven by the demand.
I made very clear during the course of the year my concerns about the increased costs of legal aid. The Legal Services Society board has made a number of changes during the year, and more are being contemplated. Those changes don't show up immediately, because someone might qualify for legal aid but the actual payment to the lawyer might be six or 12 months down the road, depending on the nature of the case that's underway. So the ability to get hold of costs quickly is very difficult; the payoff is later on. I'm hopeful that as we progress in looking carefully at how legal aid is delivered, we will be able to get hold of the costs in an effective way and at the same time provide improved delivery of services in areas that are now, arguably, underserviced.
C. Tanner: Thank you, minister. You can be assured that we on this side of the House are going to be watching that, because this is exactly the sort of expenditure that we're concerned about, as you are -- but I suspect we are more than you. Was there any specific type of case that you found you were getting more action on? Could you identify a trend that was becoming apparent that would give us some indication of where the problems are?
Hon. C. Gabelmann: The bulk of the expenditures are on the criminal law side as opposed to family or immigration. We've generally seen in the court system -- as a result of the Charter and other issues -- that criminal cases are increasingly more expensive, and that's a problem. The whole issue is compounded by the fact that the tariff was doubled in 1991 by the previous government, and a lot of the effect of that took some time to work its way through the system as well. Just for members' information, the Legal Services Society reduced the tariff on the criminal bar side by 15 percent -- effective December 1, I think. The increased volume in criminal cases, the increased complexity of the issues and the general cost of criminal trials has now contributed to the entire issue.
I wouldn't want members on that side to be left with the idea that they are more concerned with the cost explosion than members on this side are. I would defy any member to be more concerned about it than I am.
A. Warnke: I want to thank my colleague for Saanich North and the Islands. He asked a series of questions that I was prepared to ask as well. Perhaps it wasn't clear in the questioning and answering that the Legal Services Society cost -- essentially just over $38 million for the fiscal year 1991-92, as pointed out by the Attorney General -- has jumped to $71.5 million in '92-93. There was some ambiguity and I just wanted to make that clear, but the minister is quite correct. Nonetheless, it is a jump from $38 million to $71.5 million, and I recall that a year ago this certainly was explored. It's interesting to note that even in the context of this one year, legal aid has contributed to an overrun of nearly $15.5 million.
[6:30]
I'm a little concerned -- as is my colleague for Saanich North and the Islands -- that when we total it up, expenditures for the Legal Services Society have more than doubled from the previous year. Therefore I would like to ask the Attorney General -- I think it is still worth following through on a little bit -- what the factors are that have contributed to such a dramatic increase in legal aid expenditures. When we're talking about the increase in the volume of criminal activity, I think it would be useful for the public to know what some of the significant contributing factors are. Is it just the increased volume of crime and responding to it, or is there a type of crime that we should be cognizant of that has contributed to such a dramatic increase? I'm just curious about some of the most prevalent factors here.
Hon. C. Gabelmann: It's difficult at this point to talk about specific kinds of crime, but what I can talk about is the fact that in times of recession or depression in the economy you're going to find more criminal activity than you do during boom times. We see that in terms of our jail population; it very much tracks the state of the economy. When times are poor and there's a lot of poverty and unemployment, then this kind of activity increases. I think that has as much to do with any of this as anything else.
If we could find a way to eliminate poverty, we could reduce the Attorney General's budget in very dramatic terms. The cause of most of our costs is in fact poverty in our society. We pick up the pieces. One of the pieces we pick up is effectively 10 percent of our budget: legal aid to assist people who have no income and who have resorted to crime -- often driven there by circumstances that the economy has in effect dictated. I think that has more to do with it than anything else.
A. Warnke: I think everyone recognizes that poverty is certainly one contributing factor to the increase in crime. But as has been noted already, it's the dramatic increase -- over double the previous year's -- that we're most concerned about. However, in the latter part of his answer, the Attorney General really helped us out in terms of suggesting a real answer: that no income essentially means that money has to be allocated for people to be represented in court. I just want some clarification on that. Is the bulk of it for legal aid, as the minister sees it? Is this sudden dramatic increase for which moneys are being allocated due strictly to the inability to pay for lawyers and so forth?
Hon. C. Gabelmann: That's a significant factor, but probably the major issue is the consequence of the doubling of the
[ Page 4923 ]
tariff in '91 by the former government, when threatened with a withdrawal of services. That has had a very profound impact on the system, and the full effect of that occurred in the fiscal year just ending. The impact of the reduction in the criminal tariff from December 1 won't be felt until this coming fiscal year and beyond, hopefully.
How do you measure where all the costs and dramatic increases come from? First of all, I think you look to the doubling of the tariff. Then you look to other issues, such as lengthier trials, more criminal activity and on and on.
A. Warnke: Still on the question of the legal aid society, I would like the minister to explain their operational costs which required additional expenditure through a special warrant.
Hon. C. Gabelmann: I think the member is making reference to the wording in the order-in-council in the warrant, which refers to operational costs. The operational costs of the Legal Services Society are all their costs for staff, rent and fee for service. All of their costs are operational costs.
V. Anderson: I appreciate that the minister has indicated that a large part of the increase in costs was the doubling of the tariff. I think it's important for people to understand that. If I heard right, he indicated there were three basics that they dealt with: immigration law, family law and criminal law. Could he indicate the increase in those three areas? Could he give us some indication of the number of increases or the percentages? I think the public has the idea that the number of cases has increased in these areas. That may or may not be the case once you take away the doubling of the tariff. I'm trying to get some idea of the percentage of unexpected increases, and how they were divided in those three categories.
Hon. C. Gabelmann: I'm just trying to determine whether there's a simple way of giving an answer to the member. First of all, in terms of the year we are just ending, we don't have the ability to give precise or even general answers to the question about the number of cases or the ratio between the various components. I was just trying to see if I could answer for previous years, but I'm not sure I can do that intelligently without sitting down and studying the table and then condensing it. I'm a bit reluctant to sort of do it off the top of my head. I'm quite prepared to share the information with the member if he would like to discuss it with our staff.
In general terms, the criminal tariff occupies the biggest part of the budget; the family tariff is the next biggest. Those are the two significant items. Then there is a component for immigration. In the projections for this year, the Legal Services Society projected that the criminal tariff would be $34 million, the family tariff would be $26.5 million, and the immigration about $4 million. And then there are other components of their budget as well, but those were the major issues.
How the year has actually matched those projections, I can't say at this stage. Perhaps during the estimates debate later this spring, I'll be in a better position to answer some of those questions. But in addition to that, any members who want more detailed information are certainly welcome to talk to ministry staff, and we'll share with you all the information that we have.
A. Warnke: I want to ask just a couple of questions with regard to the lawyers' salary settlement. Just very quickly, as a background, the Crown prosecutors voted on a proposed plan for pay raises in October of last year. However, it has not really been reported just what the settlement was -- what the pay hikes were and so forth. This is where I'd like to see some clarification. Crown prosecutors start at about $29,000 and range to about $100,000. Would the Attorney General -- in light of the special warrant allotted for the implementation of lawyers' salary settlements -- clarify as to whether this settlement refers to the settlement for the Crown prosecutors that was voted on in October last year? And to help us out, would the Attorney General indicate the terms of the settlement package, if that's possible?
Hon. C. Gabelmann: I would if I could. First of all, the agreement was reached last fall, as the member indicated. There was significant outstanding disagreement about what the settlement actually meant, which was then referred back for further arbitration. The results came through -- in January, I guess -- and then the work began to try to translate the settlement agreement into actual pay scales for lawyers, particularly prosecutors. That work has been completed to the extent that paycheques are being issued and people are now getting paid what the settlement called for.
There is no simple way of doing this. Let me say, just in general terms, that there were some what I would really describe as terrible historical inequities in the salary levels for lawyers who work for the government in particular. For example, prior to the agreement, lawyers from zero to five years' call were averaging $32,374. This included lawyers who were five years at the bar and who are on the front line of the criminal justice system prosecuting cases for us. The new rate average for zero to five years is $51,779. Those are probably the kinds of figures members would be interested in, because that's where the significant anomaly was.
There were a lot of other anomalies throughout the system. There was a historical problem, and we think we've redressed it in a way that combines the needs of the prosecutors with recognition of the financial constraints we are under. This is not by any means a rich settlement. It still puts the prosecutors below their federal counterparts operating in British Columbia. They would argue strongly that it puts them behind other jurisdictions; but we think they do pretty well, given where they were and where they are now and the economic realities of the province. So it's a good settlement from both sides, I think. If members want more details about how it works right across the board, again, we would be happy to provide that information.
[ Page 4924 ]
A. Warnke: Just to clarify what has been said, were the increases across the board or only to the lesser-paid prosecutors?
Hon. C. Gabelmann: First of all, there was a new system of classification, which adds yet another element to the complexity of trying to convey information in an intelligent way about the settlement. Beyond that, the bulk of the financial redress was at the bottom end. But there were changes throughout the system as well, some caused by increases on the year of call, some by the classification adjustments.
A. Warnke: I wish to pose a couple of questions to the minister, and then perhaps we could wind it up.
[6:45]
Last year there was a reference to the integrated case processing system -- ICPS is one acronym that's been tossed around -- involving the computerization of the case system in the Robson Square courthouse. I see it here under vote 19 as a contributor, although not a major one -- $760,000, I believe it was -- to the implementation of systems equipment at the Robson Square courthouse. Perhaps the Attorney General could qualify the cost of the expenditure for the equipment at the Robson Square courthouse.
Hon. C. Gabelmann: The first point I should make is that this warrant has nothing whatsoever to do with the integrated case processing system. There's no connection here at all. Let me just go through what the whole $759,000 is about: $220,000 was for information systems in the new family, youth and small claims court at Robson Square. That's pretty straightforward. In the remainder, there were changes to the courts automated tracking system, CATS, in the provincial judiciary -- that was $133,000-plus. Then there was $56,000 for maintenance of the court services accounts receivable system, an unanticipated payment for software maintenance of $80,000, maintenance requirements for court services outdated hardware of $150,000, an unanticipated replacement of power equipment at $25,000, and miscellaneous items of $95,000-plus.
A. Warnke: That does clarify it for me. I was wondering whether it was in fact hooked up to the ICPS. I like the answer that the Attorney General gave. For the time being, that's all I have.
On warrant 4.
G. Farrell-Collins: I see that we don't have the minister here. The Finance minister is going to answer the questions. To get off to a start, perhaps the minister could give us a bit of a rundown on what the expenditures and overruns were.
Hon. G. Clark: With the old Lottery Corporation GO B.C. grants, the previous administration or government of the day would make a commitment for a lottery grant. For example, a community group would be awarded $1 million. They wouldn't actually get the $1 million until they raised their commensurate funding, started construction and let out the contracts. As they let out the contracts, the provincial government gave them some of the money, until it was paid out. That's the normal course of business. When GO B.C. grants ended in last year's budget, we honoured all the outstanding commitments, which was quite appropriate. We estimated in last year's budget how much would be drawn from the fund in order to pay for all those commitments. When we eliminated the GO B.C. program -- about $40 million, I believe -- some community groups got concerned that some of those commitments wouldn't be honoured. They moved more quickly than we anticipated in terms of accessing the commitments made by the previous administration. We required a small special warrant here, relatively speaking, of $2.2 million. It's not an increased expenditure in total. In fact, to be candid, it reduces our expenditure next year, because they are multi-year commitments. It simply moved it up into this fiscal year, because -- quite appropriately -- we honoured the commitments made. If they got into construction faster than they anticipated, the drawdown from the provincial government was faster than anticipated and it required a warrant to do that. The essence of the explanation is that they are simply drawing down on those commitments faster than we anticipated. It's not surprising that it is an estimate of how much will be drawn down based on some plans over the year.
G. Farrell-Collins: I see the real minister is here -- round from the dining room, I assume.
In looking at the budget estimates that came down last year, we have a $2.2 million overrun. Is that overrun strictly in operating costs, or is there any portion that will be allocated to salaries, asset acquisition, or other allotments that are in vote 46?
Hon. L. Boone: I have to get my breath; I ran up from the dining room.
I'm pleased to answer these questions. The overrun is strictly on the community grants program, on previous GO B.C. commitments that ran over into this year. As you know, when we came in, approximately $86 million in outstanding awards had to be paid out, so we anticipated that there would be about $40 million. Unfortunately, more came in this year than we anticipated, so we had to pay those out; we didn't have any choice.
I'd like to give you some idea of where some of the money went: the Fort St. James fire department received $41,619; the West Richmond Community Association received $750,000; the Capital Mental Health Association in Victoria received $128,000. Those are just some of the grants that were given out over that period and that made it so that we had an overrun.
G. Farrell-Collins: Perhaps I should ask a long question so that the minister has a chance to regain her breath. I was worried that she was going to faint.
Hon. Chair, the minister says that $86 million is outstanding. Is that as of now?
Interjections.
[ Page 4925 ]
G. Farrell-Collins: The Finance minister says it is and the minister says....
Hon. L. Boone: No. That was last year.
G. Farrell-Collins: Last year $86 million was outstanding. That's an increase or overrun of approximately 4 percent, or something to that effect -- not quite 3.7 percent. It's probably more than that, because if my reading of the estimates is correct, the minister estimated an operating cost of $44.58 million for the Purchasing Commission. How much of that would be from the GO B.C. pay-out, and how much of a percentage increase is this $2.2 million overrun?
Hon. L. Boone: Perhaps you didn't understand. The entire overrun is from previous GO B.C. commitments; $86 million was outstanding last year. We've paid down that amount by $46.3 million. In fact, in terms of the amount that came in unexpectedly, we ended up being $5.5 million over what we budgeted. We reduced approximately $3.3 million within our ministry, so that we only had to have a special warrant for $2.2 million. That is all of it. None of it is in administration at all; it's strictly grants that had been approved previously that came in.
As you know, when grants are approved, it takes some time for the various organizations to complete them. Often they are left over a period of two or sometimes three years before they actually get completed and we get the dollars out to them. That's why we had this overrun at this time, and that's why it's really hit-and-miss as to how much we're going to have to expend this year. We have done some phoning around, asking the groups: "When do you expect to come in for your grant application?" We have then based our budget this year on our best guess as to who's going complete their projects within the year. Hopefully they will do so. If not, if more of them complete this year again, we may have a special warrant at the end of this year. But it has nothing to do with any additional costs in any other portion of the ministry; it's strictly for the GO B.C. grants.
G. Farrell-Collins: I guess the question I'm trying to ask the minister.... We have an overrun of $2.2 million because people came in with their grants. What was the amount...?
Interjection.
G. Farrell-Collins: The Social Credit member seems upset by the question. Perhaps he's sensitive on GO B.C. Maybe the minister will have more to say on that.
What I'm wondering is: how much was anticipated being paid out in GO B.C., and then, with the overrun, how much was actually paid out?
Hon. L. Boone: For our total grant program, we anticipated $40.8 million. Out of that, $31 million was to be for previously committed grants. As you know, we expected to have $2 million for a new grant program. And then there are other things that go in there: in-province travel, community archives, the Maritime Bicentennial, Sea to Sea and Halfback. That all comes up to $40 million.
When we were phoning around, we anticipated by August of last year that there would be a lot more people coming in for grants than we originally thought, in terms of the $31 million. So that's why we did not proceed with the new program, and that $2 million was rolled into the other one. As I said in the beginning, in that whole grant program we are only over by $5.5 million. We then looked within the ministry, and reduced $3.3 million within the ministry, so that the special warrant we came forward for was $2.2 million. We made internal savings so that we wouldn't have to come for more dollars than was necessary.
On warrant 5.
L. Reid: I'd very much like to debate the issue of interim supply. The requirement for an additional $40 million to cover additional costs arising out of settlements between the Health Labour Relations Association and health care worker unions is a further indication of this government's lack of accountability in managing health care resources. I'd ask the Minister of Finance to please comment.
Hon. G. Clark: The member is correct that the wage settlement in the acute care sector was over budget by $67.19 million. During the year, we achieved some cost savings in the amount of about $27 million -- actually more than that, but that's in this sector -- and as a result, the warrant requirement is for $40 million.
Members should refresh their memory. The members of the opposition were clamouring for a settlement to the health care dispute. Every day we moved to a series of mediations, and then literally a series of non-binding arbitrations, where an award came down to recognize some of the unique characteristics, particularly of nurses and mostly women workers. They did receive a significant settlement, and it was more than we budgeted for. But it was a settlement that we were obligated to pay as a result of the process, and it's a settlement we did pay. We achieved some significant cost savings through the year, so the warrant is significantly less than it would otherwise have been.
L. Reid: While we understand the government's seeming preoccupation with consolidating the labour unions in this province, our concern is the cost of this agreement, and certainly what has been reported over time has looked at $40 million. I ask today that the minister respond to the entire cost of this package. I'm not convinced that the individuals will be employed under this agreement.
[7:00]
In John Blatherwick's memo earlier this week -- basically it's a job-hunt memo -- he's asking people in British Columbia to brainstorm on where they might find hospital employment for 500 people. Either the agreement is going to employ people actively in health care delivery in this province, or we're going to be paying their salaries while they are doing other things. I ask the minister to comment.
[ Page 4926 ]
Hon. G. Clark: I'm not quite sure of the question, hon. Chair. As you know, this is a warrant for money that has been spent when the House is not sitting. As I said at the outset, it is true that the additional requirement for hospital wage settlements was $67.19 million more than we budgeted for. Part of the reason for that is that some of it was retroactive, so it actually passed through two budgets. So while the budgeted increase for this year....
Interjection.
Hon. G. Clark: No, I'm not trying to blame anybody, except that the budgeted increase for this year -- 1992-93 -- was exactly what we settled for. But the budgeted increase for the previous year was higher and as it flowed through, it cost more money than we had in the budget. There's no getting around that; we acknowledge that. We underestimated how much would be required to settle the health care workers' dispute. We felt it was in the public interest to settle this dispute. We settled it in an independent manner, essentially through arbitration, and this is to provide the funding to fully fund that settlement. So it is fully funded this fiscal year. Of course, the budget we've introduced is to continue that funding for the following year. However, that funding is very challenging and requires a significant reduction in the number of staff in order to meet the requirement. That's why we're taking other action in that regard. But this fully funds the health care settlements for the current year just ending.
L. Reid: Can the Minister of Finance justify the complete abrogation of the collective bargaining process resulting from his intervention in the recent HLRA agreement? The question refers directly to whether or not the public sector should be leading in terms of these settlements. I don't believe you have responded to my first two questions.
Hon. G. Clark: I wasn't as involved in the settlement that we're debating, but I have certainly acknowledged my involvement with the Minister of Health in the settlement for the coming two years. It's actually for three years: the end of the current agreement for one year and then a two-year extension.
L. Reid: So you were involved?
Hon. G. Clark: Yes -- after the fact, but not dealing with this warrant at all. This covers until the last year of the collective agreement.
Was the wage settlement excessive? The nurses' wage settlement was for 4 percent, 3 percent and 3 percent. At the time of that settlement, that was generally perceived to be a pretty good settlement in the public interest, because the settlements were coming in. The teachers had settled for 7 percent on average, and the public sector settlements in the municipal field and others were for 5 or 6 percent. The BCGEU settled after this agreement at 6 percent, which was competitive in the time frame that we're talking about. The nurses settled for 4 percent, which I think was a good settlement. The second 3 percent was budgeted for, but the 4 percent was higher than what was in the previous budget that we inherited, and it sort of flows through as an overrun.
You might know that even though there are more people in the Hospital Employees' Union -- the nurses and the Health Sciences Association are higher-paid individuals because of their skill levels -- more than half of the actual wage bill in the acute care sector is dominated by the nurses and the Health Sciences Association. So the predominant part of this overrun was a result of settlements in the three unions involved. They were high. I'm not sure that I am prepared to say they were too high. When you look at it competitively across the public sector and the private sector, they were....
Interjections.
Hon. G. Clark: I'll just remind members that this is 1991-92. The inflation rate in 1991-92 was about 4 percent. Private sector wages were a little lower than that -- that's correct. In terms of the competition for nursing talent -- predominantly women -- in North America, this was not an exorbitant settlement. But it was more than we budgeted for. We did have an option, and that was to not provide this funding in order to fully fund the settlement, which would have resulted in significant layoffs in the health care sector. This year we chose to fund it and then to take a new approach for the subsequent three years, so that's the difference, hon. member.
We did achieve cost savings during the year in the Ministry of Health. The warrant is for $40 million, which is not that large on a $6.5 billion budget. It's not really acceptable; I acknowledge that. No one wants to see any overruns, but compared to some of the overruns we've seen in health care, which is one-third of the budget, it's not a huge amount, largely because of the cost savings we achieved during the year.
L. Reid: To make direct reference to the warrant:
"AND WHEREAS Estimates for the fiscal year ending March 31, 1993 made insufficient provision for the funding of costs arising from hospital wage settlements between the Health Labour Relations Association and the British Columbia Nurses Union, Hospital Employees Union, Health Sciences Association, International Union of Operating Engineers, Professional Association of Residents and Interns and British Columbia Government Employees Union;"
I believe the International Union of Operating Engineers is currently on strike in private residences in this province. You're assuring British Columbians that the cost of this agreement is in their best interest -- to avoid a disruption in health care delivery. What is your response to the current interruption of service, if indeed this warrant is supposed to guard against that?
Hon. G. Clark: It doesn't have anything to do with this warrant, as far as I know. Operating engineers have a very small number of members in the major acute care hospitals. They largely deal with the heating and boiler operations in the hospitals. This funds those settlements and doesn't deal with any subsequent settlements you might be talking about, as far as I know.
[ Page 4927 ]
L. Reid: The point you have made today -- and the minister has repeatedly made -- is that this is going to buy us labour peace in this province. My concern is that British Columbians are obviously not being well served by this cost overrun if it is not going to give us any benefit, and it certainly is not benefiting us in its first year of what is going to be a three-year package. We are paying today for the first year, and we're not receiving the services that both you and the minister have assured us we would. What is your response to that?
Hon. G. Clark: In fact, it has given us labour peace here. Remember, we had a health care dispute -- a strike. We had an arbitrated settlement, and it was agreed to. This is the cost of that arbitrated settlement, and we haven't had any strikes in the acute care sector since then. What you're referring to -- in terms of the renegotiation of the third year that was arbitrated and an extension for two years -- is a different approach. It's not the subject of this warrant. This warrant is only to deal with the first two years of the collective agreement. It did settle a labour dispute and we have had labour peace in the acute care sector. This cost overrun is to fund the settlement that Mr. Munroe recommended to the parties.
L. Reid: There's a concern in terms of the cost and who this is going to cover. In the last number of weeks we have seen six new executive directors appointed to be the so-called facilitators of the Closer to Home process. I see this $40 million as being required to fund the shift to community care. Are we going to be able to actually benefit from this without any kind of cost accounting? We have not seen that. Is there anywhere in this $40 million some feasibility study, some sense that this a good return for British Columbians? These dollars have already been spent.
Hon. G. Clark: I'm not sure what you would have us do if we were not to fund it. That would cause significant reduction and significant layoffs in the health care sector. I want to remind members that we made cuts elsewhere. On the expenditure side of this budget, in spite of these warrants, we have come in under budget. There have been cost savings elsewhere to fund it, so in spite of these we took corrective action elsewhere to fund this as a priority as we moved through. It does not do anything. This is basically a continuation of the status quo -- an arbitrated settlement which we're paying for.
I'd be delighted to talk about the future -- and I'm sure we will before the session is through -- and how we're trying to manage the health care budget. This is simply a continuation of what we had in the past. We had an industrial dispute, a strike; we had mediation; then an arbitrated settlement that was agreed to by both parties, and this is the consequence.
G. Farrell-Collins: The original cost would have been $67.3 million, I believe the minister said, because of a $27 million savings by the ministry. In fact, the warrant we're looking at now is only $40 million. What portion of that $27 million savings was a result of the job action itself and the fact that people weren't working and weren't being paid for that period of time?
Hon. G. Clark: The answer is none, I believe. The hospitals receive a global fund, so any savings accrue largely to the hospital, I believe. I could check it for you, but that's my understanding. We went through, as you probably remember, three rounds of savings. We first asked for cuts, then sent some people in to review budgets and finally implemented some savings across the ministries. There was significantly more than $27 million in the health care field, as was announced at the time, but I wanted to keep it apples and apples and limit it to the acute care sector.
So it's not a savings associated with the dispute. Savings were associated with delays in bed openings. There was some reduction in debt service costs as a result of interest rates coming down and changes in the way we managed that. There was a delay in implementing new programs. There were some recruitment lags in hiring in the community care sector as well as in the acute care sector. We undertook a variety of expenditure-saving methods in health care, and we're not counting any of the savings associated with the dispute.
Actually, the dispute was quite clever in that respect. The Hospital Employees' Union managed to apply a fair amount of economic pressure in the sense that they never actually went on a full-scale strike where we would save a lot of money. They had rotating strikes, half strikes, hours here and there, which the hospitals had difficulty managing, and they didn't achieve any significant savings as a result of the dispute. The good news is, of course, that we didn't have a full-scale shutdown, which would have dramatically affected the quality of health care at the same time. It was more an irritating -- at least from a management point of view, I'm sure -- and fairly effective way in which they could impose some costs on the institutions and not suffer the same kind of economic pressure themselves.
Anyway, it was a long and drawn-out dispute that we ended up moving, as is normal, to a third party for mediation, then another third party for arbitration, and which resulted in a settlement.
[7:15]
G. Farrell-Collins: It was probably more than just irritating to a lot of people. It was quite disruptive to a number of people in this province. There is a cost overrun as a result of this settlement of $67 million, which then was reduced by $27 million, and the minister is saying essentially that the $27 million saving was done over the entire health care budget.
Hon. G. Clark: It's a lot bigger.
G. Farrell-Collins: Whatever. The reality is, though, that some portion of the $27 million that he's discounting from the $67 million has to be as a result to some extent of the job action. If the minister would commit to find that information for us, perhaps we could move on to something else.
Hon. G. Clark: I'll certainly commit to find that information, but I can say with all sincerity that we did not save money on the dispute. We've saved money in
[ Page 4928 ]
other areas. But I have no hesitation in getting any information.
L. Reid: I want to refer to the Health Labour Relations Association chart, "Total additional funding required over three years," because I believe it certainly needs to figure into the equation on the first $40 million. There is the table that looks at costing variation: one staff replacement for the 36-hour work week; no reduction of FTEs. It's looking at $529 million.
Hon. G. Clark: On a point of order, hon. Chair. I don't mean to do this in a provocative way, but the member's comments are dealing with prospective costs -- nothing to do with this warrant whatsoever. The settlement to which you refer -- which is legitimate, and I look forward to the debate -- is the last year of a collective agreement that we have not started yet; it starts, I think, April 1, and is for two prospective years. This funding is for this past fiscal year, which was not at all the subject of the accord which was reached by the unions, the employer and the provincial government.
The Chair: I would concur with the explanation by the member, and caution the member to address her remarks to the expenditures that have been made under warrant 5.
L. Reid: I believe I am dealing directly with the warrant, because I believe it was this minister who suggested that this agreement was a cost-free agreement to the taxpayer. Certainly this $40 million warrant has been sold to the public as part of that package. There is no doubt in the minds of the public that this is a package -- none whatsoever. What I would ask the minister to comment on is where we are headed in terms of public sector settlements leading private sector settlements, because it is definitely a package.
The Chair: Hon. member, before I recognize the Minister of Finance, I would ask that the member address her remarks to the fact that the warrant has passed and the funds have been expended. As the minister has pointed out, we're not addressing future expenditures under this particular warrant.
Hon. G. Clark: Hon. Chair, you've dealt with the question -- that it has nothing to do with the settlement. We acknowledge that there is an overrun in this ministry to deal with the arbitrative settlement in the health care sector, and this is how we fund it.
R. Neufeld: Just a couple of questions. The $67 million overrun and the $40 million warrant. You talked about the other $27 million and some thousand as a saving. Would that have been slotted back in the 1991-92 expenditure side?
Hon. G. Clark: That is also not the subject of this warrant. But you'll see there are two categories you can look at. If you look at estimates last year versus estimates this year, you'll see that the $67 million is not there. Okay? A more appropriate way to look at it would be to look at estimated actual expending this year versus estimates next year. In other words, this $40 million warrant is included in the base, and on top of that would be a 3 percent lift, as the Premier announced, for next year.
F. Garden: I'd like permission to make an introduction to the committee, if I may.
Leave Granted.
F. Garden: Colleagues, I have the pleasure of having visitors in the gallery from Quesnel. They are schoolchildren from Baker Elementary School, Carson Elementary School and Quesnel Secondary School. They're here for three or four days on a tremendous program that was thought up by a couple of the teachers. They spent over a year preparing them for coming down to see this city and get part of their education right here in Victoria. They're accompanied tonight by Bill and Kathy Fowkes, and there's a total of 64 students and six adults, and I'd ask you to join me in making them welcome to the Legislature.
Hon. G. Clark: I'm not sure they're learning too much today by this excruciatingly painful debate, but welcome.
I have a sense that I lost you, and I think I lost some of my colleagues here, so I'll try again.
This is an overrun of $40 million net. That's the total overrun. That's why we have a warrant here. In next year's budget it will be essentially a 3 percent lift on top of the overrun, so that's why -- as we call it, blue book to blue book -- you'll see the increase for hospitals being more than 3 percent because of this overrun. Do you follow me? The full amount isn't in the base budget. This $40 million, the wage bill, is in the base budget, and in real terms we've added 3 percent to that for the acute care sector.
R. Neufeld: I'm not too sure you didn't lose the Minister of Forests and myself again. When I go to your 1992-93 estimates and your revised forecast and subtract those, you have a difference of $13 million. You're asking for a warrant for $40 million. Are you telling me that some of this $40 million is really for next year, not for last year?
I just want to explain my rationale a bit so you understand it. If I go down to Social Services, it's bang on; it's the $40 million. The difference between your estimates and your revised forecast is $40 million, and that's what the warrant is. I'm still confused as to why the difference is only $13 million, yet you're asking for $40 million.
Hon. G. Clark: Did you say the difference between the estimates and the revised forecast is only $13 million? No. It should be $40 million. It may be that you're looking at more than vote 49. Vote 49 provided $3.9 billion, and it has come in $40 million over budget, even after any cost savings. In next year's budget, you'll see $3.9 billion plus $40 million plus 3 percent for population growth and inflation that we provided for hospitals.
L. Reid: The Minister of Finance made light of the $40 million in his comments earlier this evening by saying that wasn't a significant overrun. I believe it's a
[ Page 4929 ]
significant amount of money. I require some reassurance that this overrun is going to be taken seriously and that we are not going to be subjected to significant overruns in future. I believe $40 million to be a very significant sum of money.
Hon. G. Clark: Yes, it is. I apologize if I left that impression. I guess what I meant was that given that we have achieved cuts and cost savings in other areas, and the fact that the budget in total, for all ministry operations, is on budget, the fact that we're over budget in this area has been compensated for by cuts in other areas.
I would say further that there have been health care warrants pretty well every year since I've been in this chamber and before that. Because of the sort of open-ended nature of our health care system, you often get warrants. In fact, this year the Ministry of Health did a very good job of estimating the impact generally. This warrant is specifically for the wage-bill overrun, as opposed to the utilization overrun. Often the warrants are quite a bit higher than $40 million. This year it's lower than it could be; given the total size of it, it's a bit smaller.
You're quite correct. We're not satisfied with any overruns, and we work hard to try and bring them down. But the important point is that if we do have an overrun in one ministry, we try to make sure we cut elsewhere so we can bring the budget in on budget. And we did that this year.
R. Neufeld: Just another quick question. From all your explanations, I would say that you're safeguarding warrants for next year of about $26 million or $27 million.
Hon. G. Clark: No, I don't think you're correct. I'm not trying to be mischievous. There's no intent here....
R. Neufeld: The numbers don't add up.
Hon. G. Clark: If the member will permit, I think it would be beneficial if I make sure that the Minister of Health discusses the discrepancy that you have there. These warrants are not entered into lightly. We require $40 million more for health care than we had budgeted, and that should be reflected in the estimates book. If it isn't, I'm sure there is a good explanation for it. Believe me, we certainly wouldn't pass a warrant for more than is required to fund health care.
R. Neufeld: Just so the minister knows, I appreciate that there have been warrants in the past, and there will be warrants in the future. I'm not disputing that so much as I'm pointing out that the numbers do not add up.
C. Tanner: Could the minister give this House the assurance that none of the $40 million in this warrant is going to pay shortfall in doctors -- as it has been in past warrants?
Hon. G. Clark: It's absolutely guaranteed. It's a different vote, and that vote has come in under budget.
The Chair: There being no further speakers on warrant 5, we'll move on to warrant 6.
On warrant 6.
V. Anderson: Perhaps I could ask the minister, first of all, if she would be kind enough to explain the breakdown of the $40 million so that we might understand what it covers.
Hon. J. Smallwood: The $40 million makes up, I believe, a $3 million overrun for day care subsidy, and the rest is caseload.
V. Anderson: Looking first at the day care subsidy, could she explain a little more about the day care subsidy? What was the reason for this overrun? Does it tie in with other day care programs, or are these simply ones that are run by this ministry?
Hon. J. Smallwood: The day care subsidy is a program that is run by this ministry and this ministry alone. It's a subsidy program to support the cost of day care for low-income earners.
V. Anderson: There's a $3 million overrun. How much was the main part of that prior to the overrun? What is the total, and what is the overrun, of which this is a part?
Hon. J. Smallwood: We'll get that information for you, but you should know that this is one of the programs that is driven by statute. In other words, if a person qualifies for the program, then we're obligated to support that child in that day care. We'll get the budget numbers for you.
[7:30]
V. Anderson: While we're waiting on that, what is the statutory provision? What are the standards for this day care that drive the program? Is the increase in cost due to the increase in the cost of services? What is the number of the increase of children and families requiring the service?
Hon. J. Smallwood: The cost is purely driven by need. If a family comes in and meets the eligibility test, it is then eligible for the day care subsidy. The subsidy levels depend on the type of day care required and the age of the child. There are a number of different categories, depending on whether it's a licensed or a home day care. Rather than boring you with all of the numbers, I'd be happy to make those numbers available to you.
For last year the day care subsidy was $71 million, so the overrun is $3 million over that.
V. Anderson: I'm assuming that the $71 million was what was budgeted for the year, and the $3 million is the overrun.
Again, the other part of that question: was the overrun because of difference in costs for day care than what was originally anticipated or because of the increased usage?
[ Page 4930 ]
Hon. J. Smallwood: The levels that we pay for the day care subsidy are set, so the overrun was simply driven by demand: the number of people coming in and being eligible for the day care subsidy.
V. Anderson: Looking at the other $37 million, could you expand a little on the reason for the overrun, either in certain categories or in certain areas of responsibility? Why this particular overrun? What was the original amount budgeted, and what was the overrun on that $37 million?
Hon. J. Smallwood: This is the overrun for income assistance. The total budget for last year was $1.6 billion. The warrant is only a portion of the overrun. The actual overrun was $67 million, but because of savings that the ministry was able to incur over the past year, we are asking for the difference of $37 million as an overrun, in addition to the voted amount of money.
V. Anderson: If I understand correctly, the total cost was $1.6 billion and there was an overrun of $67 million, and you then took another savings of $30 million out of your ministry, which then left you the overrun of $37 million.
Hon. J. Smallwood: Let me clarify the numbers. I quoted you $1.6 billion, but $1.7 billion was voted for income assistance last year. The overrun was $67 million, and the savings for the ministry achieved by delaying certain expenditures that were voted on was $27 million. That's where you see the difference in the actual warrant.
V. Anderson: You say that the amount was $1.7 billion for income assistance. How much of that was actually in day care? The $67 million?
Hon. J. Smallwood: Of the $1.7 billion, the day care subsidy was $71 million. This is all within the vote last year on the programs for independence; it's all in the same category.
V. Anderson: If I understand the minister, she's saying that this is strictly because of the demand in that area. Can the minister give us any reason for that particular demand? Did any themes or any directions turn up?
Hon. J. Smallwood: This is caseload-driven, whether it is for the day care subsidy, for the additional $3 million or for the increased caseload for income assistance. We have seen a number of things impacting the day care and income assistance -- everything from the numbers of people who are coming to British Columbia from other provinces to look for work to the number of people who are no longer eligible for unemployment insurance. Just as an example, with the last changes that the federal government brought in, we're seeing an additional $100 million on this year's caseload alone because of the downloading on the province. Prior to those changes, people who would have been eligible for UI now have no other option but to come to income assistance. It's these kinds of shifts that we're seeing that have driven this overexpenditure.
While we are very clearly unhappy with an overexpenditure, I think it is important to acknowledge that because of good management in the system and because of the employment programs that we've been able to initiate over the past year, this warrant is half the size of the warrant that was brought in by the Social Credit government one year prior to this year. The warrant for last year was $80 million.
V. Anderson: You mentioned employment programs. Is this warrant strictly for income assistance to people, or is part of it employment programs and other programs? In other words, is it divided up into different categories?
Hon. J. Smallwood: It's caseload only. You rightfully point out that the other parts -- the employment programs -- are in this vote. They are on target; they are not overspent.
V. Anderson: Just for clarification, when you say "caseload only," you're presenting that this is strictly funds given to families because of their need for food, clothing, shelter and other kinds of undertakings.
Hon. J. Smallwood: That's correct. As the member knows, the income assistance vote is also a statutory obligation. If a person meets the needs test that is in the legislation and regulations, then we, as a province, are obligated to meet that need.
V. Anderson: Has there been any significant change in the needs test during the year which would, in itself, alter this program? Have there been increases during the year for those who meet the test, which would automatically indicate -- as it has in some other areas -- that there is a higher payment now required per person when they meet the test? What are the conditions that might have changed this?
Hon. J. Smallwood: For the member's information, the needs test is the same. As the member is aware, there was a rate change in February 1993. That was part of the estimates of last year. That was included in last year's estimates and is not impacted by this overrun.
V. Anderson: So to clarify, then, I understand the minister to say that the increase is strictly a result of the increase in the number of persons who find themselves unexpectedly in need. They have no other place to turn, so they have naturally turned to the ministry. Therefore you've been bound to.... There have been no other extenuating circumstances apart from those in which they have found themselves.
Hon. J. Smallwood: That's correct. Just to emphasize it, people's options in this province, as well as in other provinces, are being limited by policy changes that the federal government has brought in. The example I gave you was the unemployment insurance change. Where in previous times they could have been eligible for unemployment insurance, they now have limited options and find themselves on income assistance. Just to make a point about the changes we're seeing here in this province, as a person who grew up in British Columbia, I never thought I'd
[ Page 4931 ]
see the day where institutions like Woodward's, Birks and Peoples Jewellers would be going out of business, and where we'd see that kind of corporate restructuring going on. I think everyone in this House knows somebody in their neighbourhood who is being impacted by those kinds of changes. Those changes are being brought about by the changing global economy that we all talk about when we talk about global competitiveness and meeting the global challenge. Well, the ramifications of some of that restructuring are reflected in our caseloads. That is driving this particular overexpenditure. I want to remind the member once again that because of the good management in the system and the delayed spending that we were able to initiate, the warrant is considerably less than the warrant of $80 million that was brought in by the previous administration last year.
V. Anderson: Perhaps I could ask the minister to indicate some of the good management and creative bookkeeping that made this possible.
Hon. J. Smallwood: The answer is not creative bookkeeping. It was the practical implementation of a strategy that gave this ministry the ability to be more proactive and to give people more choices. In the past year we doubled our spending on employment training from $26 million to $58 million, which gave people real opportunities to work, to get trained and to be successful in their re-entry into the workplace. I believe it helped to, if nothing else, limit the growth and pressure that all provinces are seeing. We saw tremendous pressures on our system in British Columbia. Our very conservative neighbours on the other side of the Rockies, in Alberta, saw a 21 percent increase in their caseloads. We believe that is good management, and that it is proactive. We're giving people options to income assistance; those options are meaningful employment.
I will itemize the cost savings to the system for the member. The total was $27 million. We managed to recover $9.5 million in the slowdown for deinstitutionalization around Woodlands and Glendale. Delays in implementation for family support programs saved $5.5 million. That was simply a matter of slowing down the contracting of those programs, because we're very committed to ensuring that those programs are in place. We believe that those are cost-saving measures as well. We saved $4 million in employment initiatives. Again, that was a slowdown in the implementation of that program. There are others: building occupancy: $1 million; a slowdown of the development of systems implementation: $0.5 million; slower-than-forecast enrolment in the at-home respite program: $1.6 million; savings in services for adults with mental handicaps: $4.9 million. That's a total of $27 million.
[7:45]
V. Anderson: I'd like to pick up on the last one: the savings in services for adults with mental handicaps. We've heard a great deal of comment in the press about the need in that area. I'm surprised that there are savings in that area. For what reason would that be? The indication out there is that the need has not gone away, so why the savings?
Hon. J. Smallwood: The member could make that point on absolutely every program that we administer. There is tremendous need in this province -- whether it is for support of adults with mental handicaps, of children or of people who live in poverty. In this particular program, it was simply a delay in paying out the support money for adults with mental handicaps and, in particular, for wage parity costs. That was meeting a contract obligation that the ministry had in place to pay wage parity, in an attempt to help stabilize some of those programs.
V. Anderson: The minister mentioned employment initiative. In the past, many people have taken six-week and six-month employment training programs, but as a result of those they didn't get a job. What has been the actual success in those programs of people actually coming up with permanent and full-time jobs.
Hon. J. Smallwood: I'd like to remind the member that we're dealing with a warrant, and the warrant is dealing only with day care subsidy overexpenditure and caseload overexpenditure. I'd love to get into issues around the employment and training programs with you, but unfortunately we'll have to wait until the estimates to do that.
A. Warnke: To the minister, I would just like to explore one problem that obviously came out of her answer. Considering the fact that a good deal of that $37 million has a lot to do with caseload, I'm wondering if the minister has examined in detail the types of caseloads here. By looking at these various categories, has she been able to identify perhaps one type of caseload that has contributed to this increase of $37 million, as opposed to other types of caseloads? I'm curious whether the minister has done that.
Hon. J. Smallwood: Just to make the point that this particular amount.... It's very difficult to pick out a certain point in time to describe a certain dynamic among the caseloads. The caseload distribution is fairly even. But specifically to the issue of costs, when we're seeing increased numbers of single-parent families, those caseloads are more expensive than, say, a single person, because obviously there are more members in the family. Because our income assistance payments are based on need and family size, those cases are more costly.
The Chair: Order, please. I will just say that the members carrying on conversations in the chamber are making it difficult for the Chair to hear the members' debate. So please try to moderate your tone. Thank you.
A. Warnke: I think the minister answered the question that I was sort of looking for: was there any one type of category? The minister did focus on family single parents. It makes sense that this is one group that has a bit of a problem, which we have to address.
[ Page 4932 ]
The minister also said, in response to a previous question, that the ministry is trying to be proactive and that it is a particular kind of strategy. I'm wondering whether the minister has focused on the single-parent family, and whether there is a difference -- and perhaps not; perhaps it's difficult here -- between reacting to a sudden increase in the caseload here, and that involves a different kind of strategy for expenditures, as opposed to being proactive, whereby meaningful employment can be provided to the single-parent family.
Hon. J. Smallwood: For the member's information, I'd like to make the point that the trend in the increase in caseloads started considerably before this government took office. To make the point for the member, in case he wasn't listening to the earlier exchange, in the previous administration's last year in office, just as an example, the caseload increase was 18 percent, and the overexpenditure was $80 million -- twice what we're seeing here.
What we saw with the increasing caseload at that time continues to this day, and that is a reflection of the economic reality that those who are most vulnerable face not only here in this province but also across Canada and in other jurisdictions. The member talks about a more proactive strategy, which I referred to earlier. In this past year we have very clearly positioned the ministry -- and continue to do so with this next budget -- in a very proactive fashion: investing in people in their communities, meeting their needs and supporting them into successful employment. We have done that in a number of ways.
I'm straying a little from the warrant, and I just indicated to the hon. critic that I would not do that.
The employment and training programs that we have had in place in the last year do a number of things. First of all, they meet people where they are. If a person has difficulty with literacy or has difficulty reading, whether they have ESL problems or drug and alcohol problems, we have designed our programs to meet them where they are and support them in their transition so that they can be successful in the workplace. Obviously, if you can't read and write, it's pretty tough to hold down a job or be successful at it.
We have gone then with our employment initiatives program in partnership with small business in order to match the employer. If the employer pays minimum wage, we will then top up the $3.50 with a wage subsidy to provide a good job for entry back into the workplace and training and stability. Where that opportunity doesn't present itself -- in communities with very high unemployment, where there are no jobs available for people -- we have a RISE program. It is a regionally focused program that identifies work opportunities and actually creates jobs for people right where they live. Through that investment in people and investment in communities, we have actually impacted 85,000 income assistance recipients in a positive and supportive fashion. It is our hope -- and most of the studies show -- that by investing in people for a positive transition back into the workplace, they are far less likely to fall back onto income assistance.
A. Warnke: Essentially I am again trying to figure out exactly what the major contributing factor to such an increase as $37 million is. We are dealing not with a 2 percent increase or something like we've seen with some of the other warrants; we're talking about a fairly significant, double-digit increase. I've listened very closely to the questions asked earlier by my colleague. I'm trying to get a handle on this. When the minister says that they've essentially done something that is different from the previous administration -- and I well appreciate that -- the fact is that we're still trying to get a gauge on what it costs to be proactive. The latter few sentences that the minister put forward to describe the program and is all very well and good, but I'm really trying to get a concrete handle as to where among this $37 million the bulk lies, or what the contributing factor is. What does it cost to engage in this sort of proactive strategy? Has it been successful in terms of creating employment? I'm not sure about that. Perhaps that question could be explored later in estimates. But essentially I'd like to know the cost of taking a proactive strategy. Is that perhaps a contributing factor of an overrun here?
Hon. J. Smallwood: First of all, it's interesting that the member would reference a 2 percent overrun in other programs. The warrant represents less than 2 percent of our program overrun, and I think that would reflect good management for any large corporation. Secondly, the cost of our proactive initiatives.... When you look at the cost of the employment and training programs, the fact of the matter is that they are better than cost-neutral in that by supporting people to get into the workplace, it is a net saving to income assistance. Quite frankly, we would much rather have people working than on income assistance.
A. Warnke: I did not ask whether it's better or whatever; I'm just essentially trying to get a concrete figure as to the cost of engaging in a proactive strategy. It's as simple as that. Never mind whether it's good or bad.
Hon. J. Smallwood: Let me give my answer a different way, and maybe he will understand. By not investing in the employment and training programs -- the $56 million -- it would cost more in welfare caseloads, because these people are eligible for income assistance. The cost of having them sit on welfare would be more to the system, the taxpayers. It is cheaper for us to be investing in employment opportunities.
To make the point to the member, in our employment initiatives program, it costs us $3.50 an hour to support someone, in partnership with small business, in a real job. They're not only involved by working in their community but they're also paying taxes. Mr. Member, it is cheaper for the system to support someone off income assistance than it is to pay welfare.
The Chair: I would remind the committee that we are on a $40 million spending warrant for the Ministry of Social Services. We should stick strictly to that expenditure and that overrun and not enter into a full debate on the scope of the ministry in general.
[ Page 4933 ]
A. Warnke: As a matter of fact, the point you've raised, hon. Chair, is in fact a most appropriate one. Certainly it's not an argument put forward by this side -- neither by myself nor by my distinguished colleague, who is the critic in this area -- to suggest other than that it would cost more to the system and so forth. That is an argumentative of point, and as a matter of fact it's a point that has been made by my distinguished colleague for Vancouver-Langara. The question is not how much it costs the system and so forth, if we flip that whole coin around. I was looking for a specific answer. I did not get one, so I'll just kindly move on.
R. Neufeld: I don't have too many questions. I think the minister has answered most of them. She said that there was a saving of $27 million. I'm sorry if I missed your explanation about what that saving was. I was talking to someone else. I'd like you to quickly cap that again for me, please.
[8:00]
Hon. J. Smallwood: It starts with the slowing down of deinstitutionalization. There was a $9.5 million saving there; there was a delay in the implementation of family support programs, which was a $5.5 million saving; there was a delay in the employment initiatives program of $4 million -- that was the program we were talking about earlier; building occupancy, $1 million; a systems development slow-down, $0.5 million; a slower-than-forecast enrolment in the at-home respite program, $1.6 million; and savings in services for adults with mental handicaps, specifically in the wage parity program, of $4.9 million. That's a total of $27 million.
R. Neufeld: The minister referred to the $80 million warrant in the year previous to her becoming minister, and there was an indication of quite an increase in caseloads. I would just like the minister to confirm for me, for Hansard, that she was in control of that budget for five months, that from November to the end of March, the $80 million was under her purview.
Hon. J. Smallwood: I will confirm that for the member, and I'll go one step further. In 1988-89, when the Social Credit government was in power, there was a 6 percent overrun -- keeping in mind that this is 2 percent -- of $45 million. During the '84-85 period when the Social Credit was in power, a time when the economy was booming -- just to make that point, member -- there was a $21.6 million overrun by the Social Credit government.
R. Neufeld: On a point of order. Hon. Chair, you alluded earlier to the fact that we should stay with the $40 million warrant. I asked a question about an issue that the minister raised about an $80 million warrant. I wasn't expecting her to go back to 1972, but if she wishes, maybe we should get research to go back to '72-75 and bring up some numbers there, too.
The Chair: The point is well taken, hon. member. I hesitated to interject, but now that you've brought the House back to order, I would ask the minister to assist us by addressing the warrant before us.
C. Tanner: Just one question to the minister. From some of the answers she's given tonight, can she confirm that she was party to some tricky footwork and peculiar financial shenanigans...
The Chair: Order, order. Would the hon. member please address the warrant.
C. Tanner: I'm getting there, Mr. Chairman.
...that the Minister of Finance undertook to delay payments so that he could make his figures look good for tonight? It has been suggested by various people outside of this House that the minister delayed a whole bunch of payments and consequently made the figures look better. In fact, this was confirmed by the minister tonight, who said that by delaying certain expenditures they were able to balance and come out with a $27 million savings. Could the minister comment on that?
Hon. J. Smallwood: The programs that I referred to were slowed down. They are fully funded this year in the base and are calculated in this year's voted expenditure. We can certainly talk about those in the estimates. The program money was spent. It was simply that the process of implementing those programs was slowed down.
C. Tanner: I understand what the minister says, Mr. Chairman. In fact, they're obligations for next year which have to be paid as a consequence. You've helped the minister fudge his figures by delaying those payments to make his books straight for this year.
Hon. J. Smallwood: We simply delayed the implementation of those programs, and that's where the cost saving was. They were funded for more months than we actually ended up paying out.
V. Anderson: In speaking to the nature of the caseload that involved the overrun, the minister mentioned, not surprisingly, single-parent families. Were there other areas of increase? I'm thinking particularly of two-parent families. Was there any significant increase in two-parent families, seniors or youth?
The Chair: Before recognizing the minister, I would ask that the member address the warrant before us, an expenditure that has been made, rather than getting into open debate on the estimates. The Chair has to advise members that we have allowed a fair amount of latitude in these warrants. It would assist if the minister and the opposition would stick strictly to the purpose of the warrant so that we can keep the committee in order.
V. Anderson: I was sticking strictly to the cases that were covered by the warrant and trying to understand the reasons for those and what categories were covered by the warrant. I was asking for some clarification on that.
Hon. J. Smallwood: All categories of caseload are covered by the overexpenditure. I think the point the member is trying to get at is that we continue to see an increase in the caseload growth for single males.
[ Page 4934 ]
Schedule approved.
Preamble approved.
Title approved.
Hon. G. Clark: I move the committee rise and report the bill complete without amendment.
Motion approved.
The House resumed; the Speaker in the chair.
Bill 9, Supply Act (No. 1), 1993, reported complete without amendment, read a third time and passed on division.
Hon. G. Clark: My understanding is that the Lieutenant-Governor is within walking distance of the precincts. He'll be here within 10 minutes. With that, perhaps I could move a recess at the call of the Chair.
The Speaker: We will declare a brief recess until the Lieutenant-Governor does arrive.
The House recessed at 8:15 p.m.
The House resumed at 8:17 p.m.
The Speaker: I call the House to order. Hon. members, I am advised that His Honour the Lieutenant-Governor is in the precincts and will shortly enter the chamber. If members could please take their seats.
His Honour the Lieutenant-Governor entered the chamber and took his place in the chair.
Law Clerk:
Supply Act (No. 1), 1993
Clerk Of The House: In Her Majesty's name, His Honour the Lieutenant-Governor doth thank Her Majesty's loyal subjects, accept their benevolence and assent to this bill.
His Honour the Lieutenant-Governor retired from the chamber.
Hon. M. Sihota: It's been a very long and productive day, and I thank all hon. members for the kind and gentle debate that we had today. With that said, I move that the House do now adjourn.
Motion approved.
The House adjourned at 8:18 p.m.
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