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)
THURSDAY, MAY 27, 1993
Afternoon Sitting
Volume 10, Number 11
[ Page 6565 ]
The House met at 2:06 p.m.
Hon. M. Harcourt: It's with great pleasure that I ask the House to welcome some visitors from the People's Republic of China. Vice-Minister Liu, from the State Commission for Restructuring the Economy, is here with a group of senior administrators from the commission and from the Ministry of Public Health. They are here to study our health care system. They are spending two days in British Columbia, meeting with staff of our Ministry of Health, and making many site visits. I ask the members of the House to give them a very warm welcome -- niyo.
P. Ramsey: Joining us in the gallery today are my parents, Paul and Shirley Ramsey, who are visiting our province for a bit of a vacation, and also to watch their grandson -- my son -- graduate from the University of British Columbia yesterday. Would the House please join me in making them welcome.
B. Jones: One of the sacrifices of speakership is that you don't get to introduce constituents when they come to visit Victoria. On behalf of the Speaker, it's my privilege to introduce to the House today Joyce and Morris Knight and their granddaughter Jessica Knight. Would the House please make them welcome.
Hon. T. Perry: Although they are not from my constituency, I would also like to join in welcoming the parents of the hon. member for Prince George North and Paul Ramsey III, and congratulate him on the degree received at UBC yesterday.
C. Evans: Joining us in the gallery today is a longtime friend of mine, Bobbie Samet from New York. She says she has come all the way to B.C. to investigate whether or not there is truth to the rumour that we have fewer murders in Canada because we take all of our aggressions out in question period. I assured her that it's not true; that we love one another, and we're polite. Would you please make Bobbie and Marcia Braundy welcome.
NAFTA AND U.S. DUTY ON SOFTWOOD LUMBER
Hon. M. Harcourt: I rise today to inform the House of an issue of great importance not only to British Columbia's forest industry and the workers in communities it supports but to our provincial economy and our trading relationship with the United States.
It has been my position as Premier, and the position of my government, that the treatment of our province's softwood lumber exports is a litmus test for the Canada-U.S. free trade agreement and the North American free trade agreement. Recent developments in Washington, D.C., on the softwood lumber countervail duty case give us great concern about the ability of the FTA to protect Canada from unfair United States trade practices and harassment. These developments strengthen my government's opposition to NAFTA, a treaty that the federal government is at this very moment pushing through the House of Commons with imprudent haste.
I would like to share with the House my letter to Prime Minister Mulroney:
"Dear Mr. Prime Minister:
"I am writing to request a delay in the North American free trade agreement vote scheduled....
An Hon. Member: Point of order.
The Speaker: Order, please. I hear a point of order. With the indulgence of the member, the Chair would choose to hear that point of order after the Premier has finished the ministerial statement and before the replies are given.
Hon. M. Harcourt: I'll repeat the opening of the letter:
"Dear Mr. Prime Minister:
"I am writing to request a delay in the North American free trade agreement vote scheduled for this evening, pending a meeting with you on the softwood lumber countervail dispute between Canada and the United States.
"B.C. Forests minister Dan Miller has just returned from Washington, D.C., and as a result of his consultations over the May 6 free trade agreement panel decision on the subsidy side of the countervail issue, it is now clear that B.C. log export controls, and indeed all Canadian provincial domestic processing requirements, have been left exposed to U.S. trade harassment. This situation will be further exacerbated by passage of the NAFTA by your government.
"On May 16, 1992, the U.S. Department of Commerce calculated a duty on imported Canadian lumber of 6.51 percent. More than half of this duty was based on B.C.'s log export controls. Canada appealed this U.S. decision to an FTA panel. Despite the fact that B.C. log export controls receive specific protection under article 1203 of the FTA, the panel ruled on May 6, 1993, that log export restrictions and similar controls may be countervailed as a matter of U.S. law.
"The major objective of the FTA was to achieve secure and enhanced access to the U.S. market and to eliminate the harassment of Canadian exporters through the capricious use of U.S. trade remedy laws. To this end, the FTA called for further negotiations between Canada and the U.S. to settle the outstanding issue of the application of trade remedy laws. The task of negotiating fairer trade remedy laws was considered so important that a failure to agree to implement such changes is grounds for either party to terminate the agreement.
"In fact, many new anti-dumping and countervailing duty cases have been initiated against Canada since the signing of the agreement. No progress has been made to date on negotiating fair trade laws with the United States. As a result, the binational dispute panels under the FTA can only determine whether U.S. trade law, however unfair, has been properly applied. In the case of export restrictions on B.C. logs, this means that lumber from B.C. and other provinces is exposed to severely damaging countervail actions even while the
[ Page 6566 ]
U.S. maintains similar -- and from our point of view supportable -- restrictions in its own northwest states. Not only is this situation hypocritical, but the countervailing duty takes away a benefit that was specifically promised in article 1203 of the FTA.
"Now, with the NAFTA, Canada is taking a further step backward. Under NAFTA there is no longer a requirement to negotiate a 'substitute system of rules for dealing with unfair pricing and subsidization,' eliminating...."
Interjections.
The Speaker: Order, order. Is it a point of order that is being raised?
D. Mitchell: Hon. Speaker, I rise on a point of privilege.
[2:15]
The Speaker: The Chair has suggested, in recognizing a former point of order, that I would take the point of order at the end of the Premier's statement. I hope the hon. member will be cautious in the way he is raising the point of privilege, and I must take the point of privilege at this point.
D. Mitchell: I can't anticipate what the member for Abbotsford was going to raise with his point of order, but I can state that I believe the very political statement that the Premier is making today is a violation of the privileges of a legislative committee of this House, which has been appointed to look into....
Interjections.
[The Speaker rose.]
The Speaker: Order, please. I remind the hon. member that in raising a point of privilege, he must briefly state his point of privilege and make the motion that he proposes to move available to the Chair. I ask the member to adhere to those guidelines on raising a point of privilege.
[The Speaker resumed her seat.]
D. Mitchell: Today the Premier is making a statement which I believe is a very serious violation of the privileges of a standing committee of this House. A select standing committee of this Legislature has had a matter referred to it relating to the NAFTA....
The Speaker: Order, please. I cannot allow the member to continue unless he does adhere to the rules of raising a point of privilege, which is to briefly state it -- which he has done -- and to make available to the Chair a copy of the motion that he would move, if the Chair should so rule. And I must ask him to now do that, or I will have to ask the member to take his seat, and we will go back to the Premier's statement.
D. Mitchell: A point of privilege, I understand, has to be raised at the earliest opportunity. I do not have a motion prepared because I could not have prepared one in the time available. But the Premier raises today a very serious point of privilege, a violation of the rules of our House.
The Speaker: Order, please. I'm going to ask the member to take his seat, and I'm going to ask the Premier to continue with his statement. Then I will take the point of order at that time, and there will be opportunity for submissions on the point of order.
Interjections.
The Speaker: I would ask for the cooperation of the members. I have outlined the procedure that the Chair wishes to take, and I assure the members that I will hear the point of order and the submissions at the end of the statement. I would ask the Premier to please continue with his statement.
Hon. M. Harcourt: As I was saying:
"Now, with NAFTA, Canada is taking a further step backward. Under NAFTA there is no longer a requirement to negotiate a `substitute system of rules for dealing with unfair pricing and subsidization,' eliminating any hope for reduced exposure to tariffs on products from B.C. and other provinces where domestic processing restrictions are in place.
"Mr. Prime Minister, the situation outlined above is untenable to the people and producers of British Columbia. It requires your immediate attention.
"I would urge you to delay the vote scheduled for this evening, and for arrangements to be made for a meeting between us to discuss this matter further."
The recent decision of the FTA panel makes plain the fundamental flaw of the FTA's dispute resolution system. The binational panels can only determine if a country's trade law is applied fairly, not if the law itself is fair. It is our position that any U.S. law that could be used to undermine a provincial resource policy explicitly protected in an article of the FTA is an unfair and intolerable law. It is also clear that NAFTA, in that it contains no requirements for parties to negotiate new fair trade remedy laws, ensures that the dispute resolution system remains largely ineffectual in protecting Canadian exporters against trade harassment.
The protection of provincial domestic processing requirements is not only an issue of importance to B.C.'s forest industry and to B.C. jobs, it is also an issue for the other Canadian provinces who were told that their policies in this area were protected in the FTA and in NAFTA -- as, for example, in the east coast fishery processing requirements. I have therefore shared my letter to the Prime Minister with my colleagues, the 11 other first ministers, and hope they will join British Columbia in calling on the Mulroney government not to move with undue haste on the implementation of the NAFTA. [Applause.]
The Speaker: Order, please.
I now recognize the point of order from the hon. member for Abbotsford.
[ Page 6567 ]
H. De Jong: The reason I raised the point of order is that this matter was referred to a select standing committee at last fall's session. The committee has not had the opportunity to report to the Legislature. The debate is currently going on, or perhaps has even concluded in Ottawa by this time. It has been known for at least the last three days that this debate would conclude today.
Interjections.
The Speaker: Order, please. The hon. member for Abbotsford does have the floor.
H. De Jong: The Premier bringing this statement before the House today is nothing other than political manoeuvring on the part of this government. Furthermore -- and this is far more serious -- it's a complete breach of normal parliamentary process, which this House deserves.
The Speaker: Submission on the point of order, hon. Government House Leader.
Hon. M. Sihota: I took the opportunity -- which I wish the hon. member would -- to review comments with regard to ministerial statements. These are found in Parliamentary Practice in British Columbia, which was written, of course, by Mr. MacMinn. On page 49, it says: "For many years, the government has been allowed by custom to make statements of new or altered policy at the opening of the daily proceedings." I pause at this point. That's exactly when the Premier rose to make the statement -- at the beginning of proceedings today. "These announcements usually relate to matters of general interest...." I don't think anyone in this House could argue that....
Interjections.
The Speaker: Order, please. I would ask the minister to give a submission on the point of order as briefly as he can.
Hon. M. Sihota: Announcements usually relate to matters of general interest. I don't think anybody can deny that NAFTA and its implications for the economy of this province, particularly as to log exports, is a matter of general policy and, if I may quote, "...and urgency...." Again, with the House of Commons voting on the issue today, I don't think anyone can argue that there's no urgency.
Interjections.
The Speaker: Order, please. The Chair is willing to hear submissions on this point of order, but we need to have the courtesy to listen to the member who has the floor at this time. I would remind the hon. minister that this is a submission on the point of order and that he is not to debate the subject matter.
Hon. M. Sihota: Thank you, hon. Speaker. I'm just pointing out on the point of order, if I may continue, that "...the practice is accepted today as a useful vehicle by which government policy may be made known to the House...."
We're dealing here with a May 6 ruling that has not been dealt with by the NAFTA committee. Therefore the Premier, in his capacity as Premier of the province, I'm sure is entitled -- in fact, it is incumbent upon him -- to deal with this issue now, in light of the fact that the ruling is one that occurred May 6. The only basis upon which the opposition would seek to take issue with the Premier's right -- indeed, his duty and prerogative -- to stand up in this House and make this statement is the fact that they themselves have a different position on NAFTA than the government does.
The Speaker: Are there further submissions on the point of order?
G. Farrell-Collins: I too would like to quote from the guide book that the minister so often quotes from as it relates to ministerial statements. However, I intend to do so a little less selectively.
It says: "For many years the government has been allowed by custom to make statements of new or altered policy at the opening of the daily proceedings." Clearly there is absolutely not one thing new or altered in the comments by the Premier. It's the same NDP rhetoric we've been hearing from Ottawa for the last five years. It goes on to say: "These announcements usually relate to matters of general interest and urgency and the practice is accepted today as a useful vehicle by which government policy may be made known to the House when no other proceeding offers a suitable opportunity."
The reality, as the Premier well knows, is that the House has already referred this issue to a standing committee of the Legislature, which in the past few days and in the future will be touring the province soliciting input from British Columbians, not from MPs in Ottawa. We want to hear what the people of British Columbia have to say about NAFTA. That committee will then report to the House, and then we can have a comment from the Premier.
Clearly the Premier's ministerial statement does not fall within the guidelines. It is not new or altered. There is plenty of opportunity for the Premier to put out his political propaganda in a more convenient way than to take up the time of this House. The Premier is clearly out of order in his ministerial statement, and it does not fall within the guidelines of Mr. MacMinn that we all try to follow.
Interjections.
The Speaker: I would call the House to order. I have heard the submissions on the point of order that was raised. From time to time we have had ministerial statements in this House. As all members well know, ministerial statements, while not part of the official standing orders, are certainly a part of the practice of this House, and the guidelines that both members, from
[ Page 6568 ]
both sides of the House, have referred to are not definitive.
The Chair has listened carefully to the points of order, particularly the concern regarding the referral of the matter to the select standing committee. But in this instance the Chair does feel that there are no specific limits on ministerial statements relating to matters that may be in the hands of select standing committees.
In addition, in ruling on these points of order, the Chair is also very much aware that with a ministerial statement, there is a built-in opportunity for response from both opposition parties. So in this instance the Chair does not feel that the ministerial statement went beyond the limits of that which has been allowed in this House as a matter of practice.
I appreciate that the member raising the point of order may feel aggrieved, but I would invite the two opposition parties to make their comments in response to the ministerial statement that was made. I would invite the members to now do so.
[2:30]
F. Gingell: Of course all members on all sides of this House are interested and concerned with the fairness of the trade rules between us and our largest trading partner. Eighty-seven percent of British Columbia's trade is with the United States.
Some Hon. Members: Forty.
F. Gingell: Forty percent. It's 87 percent of Canada's.
It is our most important single trading partner, and the Premier wants us to turn around and tear up a valid contract. It's time the Premier realized that acting like King Canute doesn't work. All you will do is get wet feet, and we will all catch cold and suffer the consequences of your actions. You can't go around trying to close the door after the horse has bolted.
An Hon. Member: Another one.
F. Gingell: A third one.
They should listen to their own Minister of Forests, who encourages everybody in this House not to be naysayers and nitpickers. Let this government get on with the job of ensuring that British Columbians take advantage of the opportunities that are there for us in these trade agreements. The Premier travels the world encouraging trade, and then he comes back and wants to tear this up and throw it in the face of our most important trading partner. It's blatant hypocrisy, and I sincerely believe his statement today -- standing up and making this speech -- was shallow political rhetoric for the purposes of their federal party's election campaign.
H. De Jong: If we go back a little ways, to last summer, it's my understanding that the Premier had an invitation from the federal government to deal with the fine points of the free trade agreement. The Premier declined that invitation. He declined it on behalf of all British Columbians. Then, at the fall session, the select committee was established with a mandate to tour the province and find out what the people of B.C. were thinking about the NAFTA. There were many presentations made, some for and others against. But the fact is, hon. Speaker, that there were many good presentations made -- from both sides. Certainly this ministerial statement today is premature. In fact, it's an embarrassment to all those people who made presentations to the committee. They made those presentations in all honesty and sincerity to the committee, and yet this Premier, this government, does not allow that committee to report before he stands up here and makes his ministerial statement. I think it's a shame. It's an abuse of the House; and it's an abuse of the privilege of the Premier, in terms of establishing a select committee.... I have served on the committee....
Interjections.
The Speaker: Order, please. I would ask the member to take his seat while I call the House to order so that the hon. member for Abbotsford can complete his statement.
H. De Jong: I have enjoyed serving on the committee.
Interjections.
H. De Jong: The fact of the matter is that since the House went into session I have not attended a committee meeting, and I have specifically...
The Speaker: Your comments through the Chair, please, hon. member.
H. De Jong: ...made known to the Chairman of the committee that because of our duties in the House I could not attend those committee meetings. However, that's beside the point. The point is that the Premier has not allowed this committee to report to the Legislature before making the statement here today. Because of the abuse the Premier has caused to this select committee, which was duly established by this Legislature, I take the opportunity at this point to officially resign from the NAFTA committee.
The Speaker: The hon. member for Okanagan West on a point of order.
C. Serwa: No, I'm going to also take the opportunity to respond to the ministerial statement.
The Speaker: I regret, hon. member, that the practice in the House is to allow one response per party to a ministerial statement. Therefore I cannot allow the hon. member to respond.
The hon. member for West Vancouver-Garibaldi on a point of order.
D. Mitchell: I rise to move the point of privilege I attempted to raise earlier.
[ Page 6569 ]
The Speaker: Briefly state your point of privilege and then forward the motion to the Chair.
D. Mitchell: The issue today goes beyond the order and proceedings of this House. It strikes at the privileges of this Legislature and its legislative committees. I believe that the statement made by the Premier today really does constitute a gross contempt for this parliament. If the Speaker would agree with this -- and I would await her ruling -- I would be prepared to move a motion that would read....
The Speaker: No, hon. member. You can only forward the motion to the Chair; you cannot read it.
D. Mitchell: I will forward it to the Chair. The substance of the motion...
Interjections.
D. Mitchell: ...is dealt with by the Speaker. But I....
Interjections.
The Speaker: Order, please.
Interjections.
The Speaker: I call the House to order.
D. Mitchell: Hon. Speaker, the case I would make for this -- which I would ask the Speaker to consider when she is considering whether a point of privilege does exist here -- is whether the Premier's statement made today prejudges the work and the referral on NAFTA that was made to a select standing committee of this House. I believe that it does. I believe it's a very serious matter, and I would hope that the Speaker would be able to rule on this in short order. Thank you, hon. Speaker.
The Speaker: A submission on the point of privilege raised, Government House Leader.
Hon. M. Sihota: The hon. member argues that somehow it is in contempt of parliament for the Premier to stand in this House and make a statement with regard to NAFTA. The countervailing duty costs British Columbia about $300 million a year -- about 1,500 jobs. The Premier has an obligation to stand up in this House and take a position. Surely it cannot be in contempt of this parliament for the Premier to stand up and protect jobs and stand up for an industry in this province. It seems to me.... Hon. Speaker, it may be that the opposition....
The Speaker: A point of order has been raised by the Leader of the Official Opposition.
F. Gingell: Hon. Speaker, the Government House Leader is obviously out of order because he should be speaking to the motion of privilege, not to the subject.
The Speaker: Thank you for your point of order, hon. member. I'm sure the Government House Leader will keep your comments in mind and make a submission on the point of privilege only.
Hon. M. Sihota: Hon. Speaker, it may be that the opposition may wish to take refuge in points of order, but it is a duty of the Premier to stand up for British Columbia and protect the jobs and the paycheques....
Interjections.
The Speaker: Is this a submission on the point of privilege?
G. Farrell-Collins: Yes, it is, hon. Speaker.
The Speaker: I will hear the hon. member.
G. Farrell-Collins: Quite clearly, this House debated some time ago the referral of this issue to a select standing committee of the Legislature. It is the duty and privilege of members of this House to sit on that committee, to take submissions from the public and to report them to this House. For the Premier, particularly as the head of government with responsibility for trade, to stand up in this House and make the type of statement that he did usurps the privilege of every member to sit on that committee and to bring the recommendations of that committee before this Legislature for discussion.
If the Premier had intended to continue to make this type of statement and prejudge the work of that committee, then he shouldn't have referred it to the committee in the first place. The privilege and the duty of every single member of this House who sits on a legislative committee has been damaged by the political opportunism of the Premier.
The Speaker: The Chair has heard the submissions on the point of privilege. The Chair will take the matter under advisement and come back to the House later with a ruling.
The hon. member for Surrey-Cloverdale on a point of order?
K. Jones: No, hon. Speaker. I rise to speak on this issue as it impacts on the concerns of my constituency. It is very appropriate for each member whose constituency is affected by this issue to make a statement in this regard.
The Speaker: Unfortunately, hon. member, the Chair cannot allow that. There is no ability to do that.
Interjections.
The Speaker: I ask the member to take his seat.
On a point of order, the Minister of Finance.
Hon. G. Clark: If it would help the Chair or members of the House, the member could ask for leave to respond to the statement, and we would see if
[ Page 6570 ]
members of the House would be prepared to give him leave.
Interjections.
The Speaker: Order, please. I'm sure the House will agree that wasn't exactly a point of order; it was more of a suggestion.
The hon. member for Fort Langley-Aldergrove on a point of order.
[2:45]
G. Farrell-Collins: Yes, hon. Speaker, it is a point of order. I believe that you may have already been advised by the Clerk of the provision under the guidelines for ministerial statements, which you referred to in your ruling to the member. The last item under "Limits on Content of Statements and Reply" states: "A member whose riding is particularly affected by a ministerial statement has been permitted a brief comment with the general concurrence of the House."
Hon. Speaker, with due respect, quite clearly the member for Surrey-Cloverdale, living as he does in a riding that borders on the United States and that has a great deal of cross-border trade, has a particular interest in this issue.
Interjections.
The Speaker: Order, please. The member who has raised the point of order.... The Chair does have that sentence in front of me at this time. Quite clearly, although it has not been the normal practice of this House, if the House wishes to give general concurrence to a member's request, that request can be asked for.
K. Jones: The NAFTA has been having a serious impact on my riding....
Interjections.
The Speaker: Order, please. I would ask for the cooperation of hon. members, so that we can get through this with some semblance of order. If the hon. member is rising and wishes to make a statement that clearly demonstrates his riding is particularly affected by the ministerial statement, the Chair has said that he must first have leave of the House to do so. That has been the Chair's statement, and I am now in the hands of the House as to where we go from here.
K. Jones: I would request the concurrence of the House to proceed with the debate.
Leave granted.
The Speaker: Please proceed with your brief statement. I ask the member to beware of the very narrow limits in terms of your own riding being particularly affected.
The hon. member for Okanagan West on a point of order.
C. Serwa: My point of order is simply that the House can only function with some consistency. A few minutes ago I rose and requested permission to speak. At that time permission was denied by the Chair. Now the Chair has reconsidered the decision and made another decision which appears to be dramatically inconsistent with the first, hon. Speaker. How can this Legislature function?
The Speaker: In light of the confusion this afternoon -- although that's not exactly a point of order, hon. member -- I can appreciate the point that's been made. The Chair would respond by saying that when the hon. member rose, he did not seek leave of the House to make that statement. In the eyes of the Chair, he rose simply to respond to the ministerial statement.
So with that explanation, I would now ask the hon. member for Surrey-Cloverdale to continue with his statement.
K. Jones: In my riding I have several forestry manufacturing plants that are going to be directly affected. This whole issue is also going to impact the transportation side of things, as there is a continual flow of trucking that carries industry from my plants into the United States as part of the trade process. With 300,000 trucks crossing the U.S. border at the Pacific crossing at the southern end of my riding, this has a very major impact upon the people in my riding. We are definitely concerned about the impact upon the plants along the Fraser in the north end of my riding, the various sawmills. This statement is going to have an impact on how they do business. It is a major monetary item that has to be addressed. It's going to affect the economy of Surrey and the general area around Surrey. This is indeed an area of great importance. The issue is so great that I think it should have been referred to the select standing committee that is reviewing the NAFTA. This was very improper and immature, and without proper procedural presentation. I think it put the select standing committee and its process into question.
The Speaker: Before I recognize members in oral question period I will make a statement, and while the Chair may have second thoughts about choosing this time to do so, I hope that I will have the cooperation and attention of members.
A couple of days ago the Chair had occasion to urge the cooperation of members in adhering to standing order 47A in both asking and answering questions. In reviewing subsequent question periods, I'm reluctant to say that the Chair has not noticed a great deal of change. In fact, the Chair has noticed that several questions continue to be particularly argumentative and enter into debate, and that several answers have quite clearly been inordinately and inappropriately long.
I want to urge members from both sides of the House to address their comments to the Chair, and also advise members that the Chair will be particularly vigilant today in encouraging both sides of the House to adhere to the guidelines of standing order 47A.
With that, I will now recognize question period.
[ Page 6571 ]
EDUCATION AS ESSENTIAL SERVICE
W. Hurd: I have a question for the Premier. Yesterday in this assembly, the Minister of Education made one of the most outrageous statements about education ever heard in this assembly. Given the fact that his Minister of Education has clearly sided with the BCTF in this strike affecting 130,000 students in this province, will the Premier be guided by the ruling of the Labour Relations Board, and order an end to the lunacy in our school system by demanding that education be made an essential service?
Hon. M. Sihota: Let me say, first of all, that we have received the advice from the Labour Relations Board.
G. Farrell-Collins: Do something with it.
Hon. M. Sihota: If the opposition wants to just chatter away, I'll give them time to do that, hon. Speaker.
Secondly, as a result, section 72(2) requires the minister to make determinations as to whether or not the next step should be taken. That includes options that range from doing nothing to ordering designation. At the appropriate time the government will advise all members of the House of our intentions with regard to the ruling of the Labour Relations Board.
W. Hurd: My supplemental question is to the Minister of Labour. Hon. Speaker, this minister has failed the students and parents of British Columbia. He failed them during debate on Bill 84, he failed them by passing the buck to the LRB, and he's now failed them by asking the school boards to bite the bullet. When is this minister going to bite the bullet himself, summon up some courage and backbone and designate education as an essential service in this province? When is he going to replace rhetoric with some backbone, hon. Speaker?
The Speaker: Order, please. I'm sure the hon. member can appreciate that in this fairly highly charged atmosphere in the House, language that is not moderate and temperate is only provocative. I would ask the hon. member to take back the words that are personally attacking another member of the House and to just restate his question in its simplest form.
W. Hurd: Hon. Speaker, I have to stand by the comment that this minister has no backbone. But if it's the desire of the Chair that I should withdraw for making those remarks, which I believe to be fair comment about this minister's performance, I'll accept the direction of the Chair.
The Speaker: The Chair has asked an hon. member to withdraw comments that the Chair considers are a personal attack on another member of the House. I think all members recognize that....
An Hon. Member: But he's running for the leadership.
The Speaker: I would ask the House to come to order, please.
I think all members recognize how important it is to adhere to the principles of parliamentary language in order to encourage productive debate in the House. While I know members feel very strongly about these matters, as the Chair who has made the determination that that language is not appropriate, I'm going to ask the member a second time to please reconsider, withdraw the personal comments, and ask his question as the Chair has suggested.
W. Hurd: Hon. Speaker, perhaps you could advise me exactly which phrases, in the opinion of the Chair, impugned the integrity of the minister.
The Speaker: The hon. member well knows that it's not the Chair's responsibility to do that. The Chair has made a request of an hon. member to withdraw words, and I am now asking a third time for the member to reconsider his words, and in the interests of proceeding in an orderly fashion, to please withdraw the words. Otherwise, unfortunately, the Chair will have to ask the member to withdraw. But I'm sure that the member would like to now reconsider, withdraw the words, and we can proceed with question period.
W. Hurd: Thank you, hon. Speaker. On a matter of principle, I will withdraw from the chamber for the reminder of the day.
The Speaker: Order, please. The Chair has acknowledged that the member has refused to withdraw the words. Regrettably, the Chair confirms that the member must withdraw from the chamber for the reminder of the day.
CONSIDERATION FOR GRADE 12 STUDENTS AFFECTED BY LABOUR DISRUPTIONS
C. Serwa: My question is to the Premier. The comments made by the Minister of Education yesterday were an embarrassment to this government and a disgrace to her office. If the minister doesn't even believe in our public school system and the value of education, what is she doing in her job? Why was she appointed, and how can the public have any confidence in that minister?
Hon. M. Harcourt: I think the minister, like every member of this House on occasion, wishes that words that have left her mouth could be taken back. I think all members realize that, and that the minister has apologized and explained herself. I think that if members now want to continue to pursue this, it will be a comment on them and not on the minister.
[3:00]
The Speaker: Before I recognize a supplemental, I'll advise members that question period will be
[ Page 6572 ]
extended by the four minutes that were taken up by non-question-period matters. Supplemental, please.
C. Serwa: The supplementary is to the Minister of Education. The public must be wondering if the minister is disinterested in the plight of students, or simply proving inept and incompetent with respect to her refusal to grant special consideration to students writing provincial exams in strikebound districts. Yesterday she defended an apparently shallow policy as a matter of fairness because the students affected supposedly enjoy an advantage by their lack of class time. What cloud is this minister living on? Why won't she reconsider that ridiculous policy?
Hon. A. Hagen: Hon. Speaker, first of all I want to take this opportunity in the House to express regret for the comment that I made yesterday. Secondly, I want to make very clear that the policy that I spoke about yesterday, around a fair exam system, has long been a policy of this government. It's a policy that was in place with the previous government. In fact, the only time that policy was altered was in the year of an election. It was altered for a strike that was taking place just prior to that election. Our exam system needs to be fair to all students. Right now we have a labour dispute that is making life very difficult for those students. With respect to those students, we are ensuring that their marks for the school year will be in place and that they will be able to write their exams. We are working with the post-secondary institutions, who are aware of the unusual circumstances that exist for these students.
Interjections.
The Speaker: Order, please.
Final supplemental, hon. member.
EDUCATION AS ESSENTIAL SERVICE
C. Serwa: The minister didn't stand up for students when education was removed as an essential service from the Labour Code. She was asked six times yesterday whether she personally believes education should be declared an essential service. Is the minister now willing to confirm, without any bafflegab, that education must be considered an essential service?
Hon. A. Hagen: The ruling of the Labour Relations Board provides a very solid basis for looking at the importance of education in the context of a collective bargaining system and strikes. The Minister of Labour has indicated that he will be dealing with the matter of designation of essential services. This is a part of the labour code and the Labour Relations Board has made a ruling in respect to schools.
LABOUR DISRUPTIONS IN SCHOOLS
C. Tanner: I have a question for the Minister of Education. In light of the minister's statement yesterday that students might do better on final exams because of the teachers' strike, has the minister considered reducing costs and improving education by having textbooks issued in September and sending the students home until their final exams in June? This would be a closer-to-home education system.
A. Cowie: My question is for the Premier. The parents of schoolchildren in my riding, Vancouver-Quilchena -- and the Premier's riding of choice -- are outraged by the fact that there's no action on improving the strike situation and getting the children back to school. The Minister of Labour is unwilling to get off his bandwagon for the BCTF; and the Minister of Education clearly showed yesterday that she was out of touch, but fortunately has apologized today. My question is: isn't it about time that the Premier took leadership, put an end to this bickering and got the students back to school?
Some Hon. Members: Hear, hear!
A. Cowie: Clearly more inaction by the Premier.
The Premier and the NDP in their election promise No. 41...
The Speaker: Your question, hon. member.
A. Cowie: ...promised they would get the best education for children. In fact, they promised that the school boards would have their mandates restored. My question to the Premier is: are you finally going to get these children back to school, or are we going to continue just to have the rhetoric and no action -- similar to the Canucks in the playoffs this year?
NORTHERN SPOTTED OWL ISSUE
D. Mitchell: I have a question for the Minister of Forests about the northern spotted owl. The Minister of Forests has indicated that the spotted owl issue is likely to be as difficult for us here in British Columbia as it has been in the northwest states of our American neighbours. Many thousands of jobs were lost in the forest industries of Washington and Oregon as a result of this issue. Is the minister saying that this government is helpless, that there isn't anything we can do, that we're going to see our resource-based communities devastated because we can't manage this issue in a way that balances the need to protect an endangered species with the need to preserve forestry jobs which now seem to be in peril?
Hon. D. Miller: No.
D. Mitchell: I have a supplemental question for the Minister of Environment. The interim management guidelines for the northern spotted owl in British Columbia -- which were issued by his ministry, and which he has told us are now in a draft form -- have already had a very negative impact on resource-based communities in our province. Will the minister agree to set aside those guidelines until a much more detailed and complete study of both the environmental and the socioeconomic impact of this issue can be assessed,
[ Page 6573 ]
which involves all of the key stakeholders, including the forest industry, local governments and the general public?
Hon. J. Cashore: I will commit to continue to work closely with the Minister of Forests. The two ministries will continue to work together to resolve this issue in the most appropriate way possible.
D. Mitchell: I have a final supplemental to the Premier. Clearly the Minister of Forests and the Minister of Environment are unwilling or unable to show any leadership on this very important issue. After thousands of jobs were lost in the American northwest, President Clinton called a timber summit to deal with that devastated industry. Will the Premier show some leadership and agree to hold a British Columbia timber summit before thousands of jobs are lost in our province, and involve in that summit representatives of industry, unions, communities and others who are determined not to see the job losses in our province that we've seen in our American neighbours' forest sector? Will the Premier agree to hold a B.C. summit?
Hon. M. Harcourt: This is an important issue, and as you've heard from the two ministers, they are working very closely with each other on it. The question of an industrial strategy that adds jobs in British Columbia instead of shipping logs to the United States is important. The minister has been meeting for a number of months with leaders in the industry, with workers and with others to bring about the creation of more jobs in British Columbia, instead of shipping logs across the border or off the continent.
The Speaker: The bell signals the end of question period.
Interjections.
The Speaker: The bell was in error.
K. Jones: It's nice to know that that bell has so many capabilities.
TOLLS ON BRIDGES IN GREATER VANCOUVER AREA
K. Jones: My question is to the Premier. Your Minister of Transportation and Highways, in a speech a few weeks ago in Kamloops, suggested a 65-cent-per-car toll on each bridge leading into greater Vancouver. Can the Premier confirm that he is actually considering creating a fortressed Vancouver, a city surrounded by toll gates?
Hon. M. Harcourt: The issue of improving the transportation system, which has been neglected for many years, is an important one. It is a matter of future policy. I will take it on notice for the minister.
Interjections.
The Speaker: Order, please. Unfortunately, hon. Premier, a minister can only comment or take it on notice; he cannot do both.
K. Jones: To the Premier once again. This one is directly to you; you don't have to pass it on to the minister. The Minister of Transportation and Highways made his comments upcountry, away from the region of impact. Do you, as a member from the targeted area and the leader of the NDP, endorse this "toll them all, toll them all -- the rich, the poor and the small"?
The Speaker: Order, please. The Chair fails to see how that comes within the jurisdiction of the Premier. I will now recognize the next questioner.
B.C. GAS AND B.C. HEALTH SERVICES LTD.
L. Reid: My question refers to an issue of both health and petroleum resources and talks about B.C. Health Services Ltd. Inland Natural Gas Marketing complained to the commission about fixed charges contained in the interruptible and transportation rate schedules of B.C. Gas and asked for a waiver of certain basic charges that the utility was recovering from customers. I am addressing my comment to the Premier because the Minister of Energy, Mines and Petroleum Resources has just left. The question looks at Health Services Ltd., which is a private sector company trying to do business in this province. Indeed, what is their proprietary interest in opposing an application for a rate change? I would ask the Premier to respond.
Hon. M. Harcourt: I tried very hard, hon. Speaker, to catch that. It was almost like the Kraft commercial: "I've got six seconds to sing." It was that fast. I will take on notice what I think I heard.
Hon. M. Sihota: Hon. Speaker, I call second reading of Bill 8 in this chamber.
I also advise members that Committee of Supply A is called for the Douglas Fir Room to deal with the estimates of the Ministry of Environment.
SOCIAL SERVICE TAX AMENDMENT ACT (No. 2), 1993
(continued)
The Speaker: The Leader of the Official Opposition adjourned debate.
F. Gingell: Bill 8 is the admission of defeat of Bill 9. First of all, part one of this bill retroactively reintroduces a tax that was struck down by the British Columbia Supreme Court. This government calls itself the New Democratic Party; it knows that one of the basic principles of a democracy is that there not be retroactivity in taxation. You can't pass laws and create taxes and make them retroactive. It simply isn't right and it simply isn't fair. The Minister of Finance, hon. Speaker, should recognize that when you lose, you don't have the right to change the score. You can't go back and say: "We've decided that instead of losing this one, we have won."
[3:15]
I appreciate and understand that it is perfectly acceptable to change the rules for the future and to start
[ Page 6574 ]
a new game, but it is simply unacceptable to turn around and create a retroactive tax when it has been defeated in the courts. On this particular issue, the minister is not living by the rules of a democratic society. I think that is most regrettable. Why did the previous social services tax amendment that applied to the legal profession get struck down? It got struck down because basically the act wasn't clear. It was too vague, and anybody could be subject to penalties for not following the rules and regulations that the act had set down.
[H. Giesbrecht in the chair.]
The defence of the Attorney General, who was representing the government, was that they could only put people in prison under this act for two years, so therefore that should not be considered a valid reason. But the fact is that the British Columbia Supreme Court dealt only with one issue. They were able to find that section 7 of the Constitution Act of 1867 came into play because the wording of the act was too vague. I accept and understand that under Bill 8 the minister and his advisers have enlarged the description of what legal services are and widened and made more definitive the description of what purchases are. But there were other issues involved in that challenge that the court didn't rule on.
The first question is whether or not the province has created a tax that only applies within the province, or whether it applies outside. That matter hasn't been dealt with. There was also a challenge based on the question of whether this is a direct tax or an indirect tax. The province has the right, under the constitution, to levy direct taxes. They do not have the right to levy indirect taxes. That particular subject, and the defence that the plaintiffs are bringing, comes back to an issue that we tried to convince the minister of during debate on Bill 9, which was the time-lag between the delivery of the services, the billing, the requirement of the lawyer to pay the amount and the time at which he might collect those fees and taxes. We tried to explain to the minister at that time that those particular sections were really unfair. To make the assumption that the first penny collected is the tax and the last penny collected is the fee and to require the amount of the tax to be remitted immediately it has been billed, or within 15 days of the month following -- when the lawyer has not necessarily been paid -- seemed to us to be a gross miscarriage. And the minister was expecting the lawyers to finance this themselves. Only something less than 25 percent of legal fees are paid promptly from the lawyer's trust account at the time the billing is made. We didn't appreciate that there was also a constitutional question on that issue, but it is something that we really do suggest the minister should revisit.
Another issue is the question of whether this tax is discriminatory. We dealt with this at great length during Bill 9, and it's just as discriminatory now as it was then. Why on earth would this government decide to levy a tax on the cost of the services of a lawyer and not on the cost of the services of an engineer, architect, accountant or any other profession? Why have they selected -- in a discriminatory manner -- lawyers? We all recognize and accept that governments will create discriminatory taxes on things like luxuries, so we have luxury taxes. A fur coat -- if you can find one these days -- might carry a different rate of tax than a cloth coat. We have seen this government bring in an additional provincial sales tax on what they call luxury automobiles.
Legal services are never a luxury. You don't go to a lawyer -- I can assure you -- unless you really have to. You go to a lawyer to get a court order to protect you because you have an abusive spouse. Is that a luxury? You go to a lawyer because you're in financial difficulties; you need to go through bankruptcy proceedings. Is that a luxury? You go to a lawyer when you're in marital difficulties and you need to get a maintenance order to provide for your children. Is that a luxury? More people are first-time homeowners than any other classification. Buying your first home is not a luxury, but you need a lawyer. When you have your will made up, that's certainly not a luxury; you are contemplating a death and all that entails. They don't charge a provincial sales tax for a person to go to a tanning studio to get an attractive tan. They don't charge a tax on the cost of going to a diet centre to get an attractive figure. But they charge a tax on the cost of going to a lawyer to get an order to protect you from an abusive husband, or to get maintenance payments for your children -- certainly not a luxury. Governments as a matter of public policy bring in discriminatory taxes that are called sin taxes. They're taxes on tobacco, taxes on liquor, taxes on things that we don't think are particularly good for you. They not only raise revenues but also discourage the use of such things. Do we want to put a tax on lawyers to discourage their use? You don't go to a lawyer unless it's absolutely necessary.
Interjection.
F. Gingell: At this point I'll just cede the floor for a second.
Deputy Speaker: The Chair recognizes that the member has taken a short break.
C. Evans: I'd like to thank the Leader of the Opposition for allowing me to make an introduction.
Leave granted.
C. Evans: Many years ago I used to log with a fellow. Both of us have now grown up and gotten more honourable professions; he's slightly more honourable than myself perhaps. Barry Gray is here as a school-teacher with a group of students from the Nelson Waldorf School. They've come very far. I wish everybody to make them welcome.
F. Gingell: I was speaking with respect to whether or not this tax is discriminatory, working on the thesis that you have luxury taxes that are discriminatory, and clearly a tax on legal fees is not a luxury. You can have what we call sin taxes, which are discriminatory and accepted as public policy. People normally only go to lawyers when they're in trouble or need help or are in
[ Page 6575 ]
the throes of bankruptcy. You don't go to lawyers for the fun of it, and that's one thing that's true. So is this a discriminatory tax? Clearly it is. In fact, it actually works in reverse. There's a positive discrimination in the act. There is no provision in the act for a lawyer to pay tax on the value of the services that he renders on his own account. If a lawyer is purchasing a piece of property and registers the property himself, that work has a value. There's no requirement in this act to have that tax paid. Everybody else has to pay the tax, but if you're a lawyer you don't have to pay. That seems to me to be inappropriate. If you are in the business of manufacturing or selling tangible goods, and you take them for your own use, you pay the tax. It's obvious this is clearly discrimination in reverse.
I saw that the two new tax experts that the government has hired Professors Gunton and Maloney, agree that this tax is regressive. I think all members of this House would agree that a tax on legal services, on the value of services rendered to someone, has no relationship to the ability to pay. But the Minister of Finance, on April 30, 1992, said that this tax was a progressive one and he was proud to introduce it. So that he understands the difference between progressive taxes and regressive taxes, I want to make the point to him clearly that progressive taxes are based on the ability to pay. They are normally taxes on income; they are not taxes on spending. Spending taxes or consumer taxes are considered to be regressive. As the Minister of Finance, it's very important for him to understand that. There's clearly no relationship between needing the services of a lawyer and the ability to pay for them. There may in fact be an association, but it may be negative rather than positive. Lawyers tend to deal with single mothers, bankrupts, the elderly and first-time homebuyers. They deal with people who need their services, and to suggest that this class of people has the ability to pay this additional tax is simply poppycock. In fact, the reverse is true.
[3:30]
When it comes to corporations, one would expect large corporations with their own house counsel to do their legal work to have a greater ability to pay a tax on legal fees than would a small business. A small business has no choice but to go outside and hire a lawyer. The tax does not apply to the value of legal work done by house counsel for the company that employs them. That simply doesn't make sense to me, particularly when the minister thinks it's a progressive tax. The burden is going to fall far more on the small business. It's also going to fall more on the individual than on a corporation, because the corporation is able to deduct the 7 percent tax from their taxable income. If they're in the 50 percent tax bracket, they'll only pay 3.5 percent; the people of Canada will jointly pay the other 3.5 percent. It is very unusual -- it normally never occurs -- that an individual would be able to deduct fees and taxes to determine their taxable income. So as an individual, you won't get any deduction; as a corporation, you will. That doesn't seem fair.
Earlier I mentioned briefly the question of delay of payment. The provisions of this act have been written in such a manner that the government has determined that the first penny paid is a penny of tax. All of the first collections, up to the amount of the tax, are taxed, and it is not until that is paid that the payment of the fee begins. This clearly is unfair and needs to be changed. We all understand and appreciate that there are such things as bad debts, particularly for lawyers who are dealing with bankrupts and single parents and people who are in difficult financial positions. Clearly there should be a simple calculation whereby the amount of money that is collected is divided at the ratio of 7 to tax and 107 to fees.
It's an unusual set of circumstances when we once again have the opportunity to debate the same bill and the same issues that we debated last year because the minister or the Attorney General got it wrong. I'd be interested to know if the Attorney General ministry, which does legal work for all of the ministries and, I presume, some of the Crown corporations, has started billing them tax on the services they render. But we said it all last year. The minister is going to hear it all again this year. This tax really is unfair; it is discriminatory. It should not be applied to lawyers if you're not going to apply the tax to architects and engineers and accountants. They -- let's face it -- are normally dealing with clients who are building something, or at least are reasonably wealthy. I'm certainly not trying to encourage you to widen the net. You should be closing it and not taxing any of these services, because it is a regressive tax. To pick out lawyers, who normally are dealing with trials and tribulations and situations where there is family breakup and a lack of money, I think shows an absolute lack of understanding and sympathy by this government for the people who are forced to take their problems to the court system.
To suggest that the purpose of putting in this tax is to fund legal aid, which is what the minister said when this tax was proposed at this time last year, is also nonsensical. We don't have taxes that are normally created to fund specific actions. I don't think that's good policy. I know the Minister of Finance doesn't believe that's good policy, because in Bill 4 -- which I was prepared to speak about -- you were taking it away for what I believe were good and valid reasons. I don't see the logic of suggesting that people who can afford to pay their legal bills should pay an additional tax to fund those who can't.
With that, I would make one last plea to the minister to reconsider this. I am sure that the Law Society is going to challenge this once more, because all of the issues that were dealt with didn't have to be dealt with by the courts. They looked at the first one and said: "That's enough. It's unconstitutional; throw it out. We don't have to look at reasons 3, 4, 5 and 6." So they'll be back next year. This time I hope that when the minister loses -- as I'm sure he will lose -- that he won't try and change the rules after and that he'll accept the verdict of the courts and allow the money to be returned to the people who were improperly taxed and make any changes that he believes are in the interests of British Columbians to apply only to the future. He really should learn to be a good sport. You don't change the rules retroactively.
[ Page 6576 ]
H. De Jong: I to rise to speak against Bill 8, and I guess that it's not unusual for a member from the opposition to speak against it. This bill is not simply a bill concerning lawyers' fees, hon. Speaker. Lawyers are being used as collection agents to gather these taxes on behalf of the government from clients who need the services of lawyers. So it's not a tax on lawyers as the bill would have it.
This bill indicates that the tax will be applied retroactively. I'm not sure of the date last year when the courts ruled that because of some technical aspect it was indeed illegal to charge this tax, but surely since that time lawyers have not collected this tax because it was unconstitutional or illegal -- whatever term may have been used. So lawyers have had clients who would normally have paid but didn't pay because there was no need to pay an unconstitutional tax. Is the minister, with his retroactive statement in the bill, suggesting that these lawyers go back to their clients of the last year to collect these taxes? Surely he wouldn't do that.
An Hon. Member: Knowing him, he might.
H. De Jong: I guess nothing is impossible with this government.
Interjection.
H. De Jong: Yes, but it's not a lawyers' tax; it's a tax on the people who use lawyers for whatever purposes.
Now put that over against the other segment of society that uses legal services through the Ministry of Social Services. Had it gone through, this tax would have been an additional cost to the Ministry of Social Services as well. But the courts decided that it was not an appropriate tax to charge. Has the Minister of Social Services continued to allowed this 6 or 7 percent tax to be paid on the charges that were put in by the legal services lawyers, or are the people using the services of legal aid exempt from this tax? I'm sure they're not because it is still a legal service provided by lawyers. Why should one lawyer pay but not the other, or one lawyer charge but not the other?
At the same time, a question comes to mind: would the Minister of Social Services allow this tax to be paid even after the courts have said it's not right, that it's illegal? Surely there must be control on the minister. Whether that is true is a question that's often asked. If indeed the courts have said that this tax is not to be charged by lawyers and not to be paid to this government, then how would the minister allow this tax to be paid? I'm sure that the minister would not allow this tax to be paid since that decision was made.
Put that over against the average person who used a lawyer's services last year, how can this government expect the people who used the services last year to pay for that particular legal service this year? They missed out on the taxes last year because of a decision by the courts. Surely we don't have a double standard in this province. If this minister wishes to push through this bill in its present form, however, we will have a double standard.
It's not unusual for this government to do that, particularly when it comes to raising taxes. They've tried it on a number of things this year -- one they finally withdrew from. This tax is not against lawyers but against a certain segment of society that needs a specific service, which we may all need from time to time. As the Leader of the Opposition stated, the large corporations which have an in-house service don't have to pay this tax because it is simply salary paid like any other within the corporation.
[3:45]
Again, this tax is aimed at middle-class people. It is another onslaught on small businesses, which often have to use these services, and on the average family, which requires legal help from time to time in purchasing a home or other things.
I'm opposed to this bill. For one thing, I cannot see the logic of it. I think it's unfair to a specific segment of society. Mostly, it's unfair to have a retroactive clause to demand that lawyers collect the taxes they should have collected last year after the courts have ruled that they were illegal. I'm opposed to this bill; we will certainly oppose it at second and third reading.
L. Stephens: It is a pleasure for me to rise today to speak in opposition to Bill 8. As the Leader of the Opposition has so clearly stated, it is a discriminatory tax. This tax, along with the labour tax, selects services and taxes them. Luxury services are not taxed. Does the government then view legal advice as a service and not as a need? Does an individual need to draw up a will? Does an individual need a lawyer during the purchase of a house? Does an abused partner need a lawyer in order to file for separation? These are the types of services and advice that will be taxed by the government's social services tax. Why does a law-abiding individual have to pay a tax to establish a will, to settle the purchase of a house or to seek an injunction against an abusive partner?
As a number of members have said in this House, this is a tax not on lawyers but on people. It's going to be on elderly couples seeking to prepare wills; on single, working and non-working mothers striving to maintain or to enforce child care maintenance agreements or court orders; on young, first-time homebuyers whose resources are already strained by the purchase of their homes; and on small business people whose cash flow is tenuous in this economy, but who still need consultation on their business problems. This is a tax on clients -- on people -- not on lawyers. The consumers of legal services will bear the burden of this tax; that's all of us.
This is a regressive tax that will impact most severely on those low- and middle-income people. It may discourage people from seeking legal help. Legal services are essential services, not luxuries. People need lawyers' advice and assistance to protect their rights and seek their remedies.
This tax will hurt small business especially. Many large firms have the benefit of in-house counsel. Small business people do not have this option. Many business people will have to pay more for legal services. This will
[ Page 6577 ]
make it harder for them to survive in an already very difficult time.
The bill stipulates that the tax will be applicable to and payable on legal work performed by non-British Columbian out-of-province lawyers if the subject of the legal work being done is situated in British Columbia or if it is contemplated that the subject of the legal work might be done at some future date. How will this collection be enforced? This stipulation will have an impact on offshore real estate and business investors. The stipulation was not in the bill last year that introduced legal fees; this is a new addition.
The legal firms will become Revenue B.C. The tax will be a burden on small firms in particular, who will have to collect the tax and pay it. The government requires that the tax be paid whether or not the firm has collected the full payment. Small firms are going to have a difficult time with this stipulation.
B.C. is the only province in Canada to impose a tax on legal services -- another first for this province.
An Hon. Member: Nothing to be proud of.
L. Stephens: And that's nothing to be proud of. No U.S. state imposes a selective tax on legal services.
This tax will discourage people from seeking legal counsel, particularly low- and middle-income people, including seniors, single mothers and people on fixed incomes. For those reasons, and others that we will be speaking about in committee, I urge all members of the House to vote against this bill.
A. Cowie: I wish to speak very briefly on a couple of points that haven't been covered by the Leader of the Opposition and my fellow members. Clearly I'll be speaking against it. It's a very unfair bill, in my opinion, to....
Interjection.
A. Cowie: Absolutely. The minister says there are more lawyers per capita in the Vancouver-Quilchena riding, and that's absolutely so. I can assure you that many of the lawyers have called me on this.
Interjection.
A. Cowie: Actually, the member for Delta North suggested that I live in Tsawwassen. I do, but I wish to announce that I am now moving to Vancouver. We have finally sold our house, and I am moving to Vancouver-Quilchena.
An Hon. Member: Move before the bill is enacted.
A. Cowie: Thank goodness I don't have any legal costs.
It purely is discriminatory, and that's what many of the lawyers who have called me.... I hope that the next step isn't that architects, landscape architects, engineers and planners.... My goodness, planners don't make enough money to even survive anyway. Surely there wouldn't be much money coming in on a tax for planners. The Social Credit government already ruined planning in this province; surely the NDP government wouldn't want to make it any worse.
However, I wish to make one point that perhaps the minister hasn't thought of. Many of the municipalities -- particularly the small municipalities -- contract their legal services out to private companies, so this is simply going to be a double tax. The lawyers will have to tax the municipalities and the regional districts. That's just going to add to the local tax burden, because there's no way of getting around it. So it's just government taxing government.
Having worked in municipal life, I can assure you that those taxes will be considerable. Legal costs on rezonings, and the way municipalities have to get legal advice these days to protect themselves, are horrendous. The member for Delta North will know that in Delta alone -- when he was an alderman a few years ago -- legal costs were probably in the range of $250,000 a year and are now in the range of $750,000. So you can imagine the taxes the municipality will have to pay -- through the lawyers, of course. The main and final point that I want to make -- because I did say my comments would be brief -- is that this is a ridiculous tax, singling out one profession. It's most unfair -- grossly unfair -- and I hope the minister will reconsider it.
L. Fox: I rise to speak on the principles and philosophy of Bill 8. Obviously those principles and that philosophy are more in line with this NDP government than they are with my party, and I therefore am opposing Bill 8.
First of all, I wonder how effective the province will be in policing this particular tax. When I look at the retroactivity of it, how will this government go back with some accuracy....
Interjection.
L. Fox: Hon. Chair, I'm competing with the member from the Liberal Party who said he didn't want to speak to this bill.
I will complete my statement about retroactivity. We read here that if an outside legal firm does business for anybody that falls within the province's domain, tax is supposed to be collected and remitted to British Columbia. First, I wonder whether the government has the autonomy to go after a firm that may have its offices in Alberta or Washington yet has been called to the bar in British Columbia. I know there are several firms like that that have done business over this course of time. In fact, I would suspect that this government would not have the autonomy to use force upon those legal firms outside the jurisdiction of this legislation in order to collect this tax. I would suspect that the courts, as they did with the earlier legislation last year, would view that as not being within the constitutional jurisdiction of this Legislature. So that's one area that I think has not been well thought out.
When we look at who uses legal services the most, obviously business and industry play a big part. Several members spoke about the fact that the larger industries
[ Page 6578 ]
have on staff at least a portion of the legal expertise they use. Beyond that, they do contract out for expertise on specific issues, and obviously they would then be obliged to pay the tax. But the bulk of the people that this will hurt will be the small entrepreneurs trying to start up or develop new companies, who are already hurting. Quite often we find that when smaller businesses are starting up, a large percentage of them fail because they're undercapitalized. Going through the legal process is a substantial cost in starting a new business, and this tax will increase that by 7 percent. True, those businesses will have the opportunity to write off that expense. The problem is that if you don't have any profit to write it off against, all the write-offs in the world are really of no value to you. So there is a direct expense.
The other part of life and the segment of the population that I believe contributes most and will be impacted most by this taxation is the average working British Columbian. The individual who is not fortunate enough to be working has the opportunity to apply for legal aid; and his costs will be paid, as the previous member for Abbotsford pointed out, by the Ministry of Attorney General or by social assistance through our legal aid program. It will be the average working person who wants to protect his family, to develop a will....
N. Lortie: He wants fair wages.
L. Fox: Well, now we want fair wages, and this 7 percent tax is going to create fair wages? That's a new twist. That's a real new twist on it. That shows the integrity and the understanding of the back bench.
It's this kind of tax that will necessitate higher wages by increasing the cost of legal protection and the cost of seeking justice to the average British Columbian. That will encourage those individuals to once again seek higher wages, either through the bargaining process if in fact they're organized, or through their employers if they're not organized, because their relative buying power is going down with every new tax that this government brings forward.
[4:00]
One of the main issues in legal fees is in the area of conveyancing. I think it was the Leader of the Official Opposition who pointed out that for first-home buyers this is not a luxury. Right now, on most homes in my region, legal fees are between $1,000 and $1,400 just to handle the average conveyancing. This 7 percent tax puts another cost of $70 to $90 directly onto the purchaser. Yet it's possible, hon. Speaker, to have your conveyancing handled by a notary public. If you choose to go that route, there's no taxation on it. Yet, if you choose to use a lawyer, you're going to be taxed for it. I don't want to suggest that a notary public cannot convey your title as well as a member of the legal profession. The act is favouring notaries public over the legal profession. It's promoting that individuals use a notary public in order to handle the land transactions that they're entering into. That, I believe, is another unfair part of this bill.
Look at some of other taxation policies that this minister has brought in, particularly the taxation on labour that he brought in with his budget. Look at the impact of that on ICBC. By the minister's own admission -- after it took him a month to answer a question taken on notice -- it was going to have a $4 million impact on ICBC over a six-month period. That's an $8 million impact on ICBC over the course of one year from a 7 percent tax on labour. I ask the minister: how many dollars does ICBC spend in legal fees in order to settle claims? It's going to be a dramatic amount of money. Where is that going to come back? Once again, it's going to come back on the average working British Columbian when he goes to buy his auto insurance. Once again, there's a compounded effect by this kind of taxation.
I'm also extremely concerned about another very expensive part of justice that involves the probating of wills. If you look at the process that must be gone through here, through the courts and through the legal profession....
I must be giving a really exciting speech, because virtually the whole House has left me.
Anyway, the probating of wills is an extremely expensive process with horrendous legal fees attached to it. This particular legislation is nothing more than a tax grab on those individuals, even though they are buried and gone. We knew that this government was considering legislation which would see those estates taxed, but we didn't realize that they were also going to tax the legal fees charged to probate those estates. That's obviously what this bill allows to happen.
There are many aspects about this, and there's no question in my mind that it's going to be challenged by the legal profession, even though the legal profession knows that they are only an agent for the government in this process. They realize that this tax is not on them as individuals or on their corporations. They won't have to pay it. The average British Columbians are going to see their costs of and opportunities for justice increase by 7 percent due to this bill.
For those reasons, I join other members of the opposition who have spoken against this bill, and I'll be joining them in voting against it.
K. Jones: I also wish to speak against the Social Service Tax Amendment Act. It sounds like it's got something to do with social services, but we have to look at who the tax is intended to attack, or who it's intended for. It is primarily going against legal fees. As such, it's not helping social services; it's creating more of a problem. It's going to place more people into difficult situations. There might even be a few more people added to the social services rolls as a result of this extra cost they are facing as they become quite marginal, particularly the small business people who depend upon this type of legal advice. They can't have a person on staff, like a larger corporation can, which this government says that they would more appropriately tax.
In this case they are going against their own intentions. Their intentions would be to tax the very wealthy and give tax relief to the poor. In this case they're taxing the poor and releasing the wealthy. It seems to be a total contradiction to the entire
[ Page 6579 ]
philosophy of the NDP. I can't understand why the Minister of Finance would even consider bringing forward such a bill. Surely the minister must have been sleeping at the time the bill was being processed, and he still hasn't had a chance to read it. Otherwise he would have thought better of it and stuck to the basic philosophies; or maybe they have changed. Maybe they are just another Social Credit Party from the past, and now that they are in government they're doing all the things that the Social Credit Party wants to do. Maybe that's the reason this bill has been brought forward. They've lost track of their basic philosophical roots, and the minister is now in charge of the big corporation that taxes all the people of British Columbia. He wants to make sure he gets every penny squeezed out of every little change purse the poor people of British Columbia have.
Believe me, this taxation has got to be the most retrogressive, the most cowardly, form of taxation hitting the poorest people who need legal services. They're certainly going to need legal aid, even if they're in the middle-income bracket, because by the time this type of extra taxation comes on it, the legal bills will be so high that most people won't be able to afford it. Maybe the intention of the minister is to do away with the legal profession. I know he has a great abhorrence for the legal profession and certainly would like to stick it to them every chance he can. Maybe this is his way, through this method. The only trouble is that he has missed the mark. He has missed the target, and the arrow is going right past the lawyer, and he's getting the backside of the consumer. The consumer is the one who will be paying and saying ouch, not the lawyers.
I will step down for a moment to allow the hon. member for North Vancouver-Lonsdale to make an introduction.
D. Schreck: I ask leave of the House to make an introduction.
Leave granted.
D. Schreck: I would particularly like to thank the hon. member for interrupting his presentation to allow me this opportunity.
In the gallery are approximately 34 grade 5 and 6 students from Lonsdale Elementary School, accompanied by one of their instructors -- and I know I'm going to mispronounce this name, but I will try -- Mr. Stuible. I know that the students will forevermore ridicule their teacher over my mispronunciation of his name. I bid the House make them welcome. Thank you for coming to Victoria.
K. Jones: The wisdom that comes from the mouths of our children is sometimes very incisive. It's a pleasure to have them here.
I hope that through this debate you will have an opportunity to see some of the problems that a government, which seems to be slightly misguided as to its purposes.... In the light of our presentation, it will be shown that this is not the type of bill this province needs. We in the official opposition, and other members of the opposition, are speaking against this bill. We are saying that it is an improper bill to be brought forward and that the Minister of Finance should seriously consider withdrawing it.
I would ask the minister to consider putting this bill to the test. After the previous bill was passed into legislation, it was tested in the courts, at great expense. I would like the minister to consider withdrawing it at this time and putting it through the test it's ultimately going to receive anyway, and that is the legal test the Law Society will definitely give it. Many other bills the minister has brought forward would probably fail that test if they were put under the same type of scrutiny as the previous bill, which this one is replacing.
The previous bill certainly does discriminate against people, according to the decisions of the Supreme Court. I think this bill also discriminates against people. It means that certain people will have to pay this tax, and other people will not. Those who, through incorporation -- whether it be privately or as a company -- can afford to have a solicitor on staff can get free of this taxation; yet those who have to hire the services of a solicitor on an hour-to-hour or day-to-day basis have to pay the tax. That's discriminatory. The minister has to realize that this is wrong; it's a contradiction of the basic philosophy of fairness in taxation.
We really wonder how much revenue will ultimately come out of it. What it will amount to is that fewer people will be able to use the services of the legal profession, and those services are only used when they are really needed. The people who are going to be hit by this are going to be those in our society who need special advice -- the person who is appealing a case with regard to their land title or some problem with the neighbour. It's the ordinary, common person who's going to be really impacted by this. We're already hit with taxes to the bottom of our pockets today, and certainly this minister is digging right through the holes in our pockets down into the bottom of our boots. There's nothing left there, hon. minister, for you to go after.
I urge you to recognize that this type of taxation is not appropriate. It is a tax that has to be withdrawn. Recognizing that you're going to go through a long legal process again and probably will not collect any money through this budget year, as you didn't collect anything through the last budget year, who are you trying to collect this money for? By the time you get finished, it will not have any value, because of the inflation process -- especially with the provincial debt increasing at such a great rate. It will basically bring no return to the province. It certainly won't be of help to the budget year that you're planning this for.
I ask and urge the government and this minister to withdraw this bill today. If he needs to do this, he should make sure that it is done in a more appropriate manner -- a fair and equitable taxation, not this continual attack upon poor people.
[4:15]
[ Page 6580 ]
Hon. G. Clark: I rise to close debate. It's always nice to follow the semi-incomprehensible remarks of the member for Surrey-Cloverdale.
I simply want to make a couple of points. First of all, no one likes to raise or impose any tax, least of all anybody in politics, but we have some choices. If you're going to raise taxes, who is going to pay them? We had a problem in British Columbia -- we still have it, although it's getting under control -- of a 100 percent increase in the cost of legal aid. Actually, it was more than that. It's absolutely dramatic. We now spend $100 million on legal aid as a result of the previous government doubling the fees paid for lawyers on legal aid. We have since cut those fees by 15 percent, and the costs are more or less under control, but it is in the area of $100 million.
It's a lot of money, hon. Speaker, and when we chose to look at revenue sources to pay for it, we thought that a tax on legal services was a fair and appropriate way to do it. I want all members to know that this is not a regressive tax; this is a progressive tax, and it is statistically proven. This is not a subjective opinion; this is an objective fact. The majority of this tax will be paid for by business, and of those individuals who pay taxes.... The more money you make, the more likely you are to spend money on lawyers. That is a statistically proven fact. This means that the more money you earn, the more tax you pay on this type of service.
As a result, it is very clear that it is a progressive form of taxation. It's not one which I enjoy, not one which I like. I prefer not to do this, but if we're looking at $40 million in revenue, the alternative sources of raising that kind of revenue are, in almost every case, more regressive than this one. While I don't enjoy imposing this kind of tax on any professional group, we do think it is progressive. It does raise $40 million, and it helps to defray the costs of legal aid, which are rising dramatically in British Columbia and in other provinces.
With that, hon. Speaker, I ask members to support second reading of Bill 8, Social Service Tax Amendment Act (No. 2), 1993.
Motion approved on the following division:
|
YEAS -- 38 | ||
|
Petter |
Perry |
Marzari |
|
Boone |
Priddy |
Edwards |
|
Cashore |
Jackson |
Pement |
|
Beattie |
Schreck |
Lortie |
|
Lali |
Miller |
Smallwood |
|
Hagen |
Harcourt |
Sihota |
|
Clark |
Cull |
Blencoe |
|
Barnes |
MacPhail |
Copping |
|
Lovick |
Ramsey |
Pullinger |
|
Farnworth |
Evans |
O'Neill |
|
Doyle |
Hartley |
Streifel |
|
Lord |
Randall |
Kasper |
|
Brewin |
Janssen | |
|
NAYS -- 14 | ||
|
Chisholm |
Cowie |
Gingell |
|
Dalton |
Farrell-Collins |
Wilson |
|
Stephens |
Hanson |
Serwa |
|
Fox |
Tanner |
Jarvis |
|
K. Jones |
Tyabji | |
Bill 8, Social Service Tax Amendment Act (No. 2), 1993, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.
Hon. G. Clark: Hon. Speaker, I call second reading of Bill 4.
BUDGET MEASURES IMPLEMENTATION ACT, 1993
Hon. G. Clark: This bill amends three acts to implement various revenue measures which support the government's commitment to control the deficit. The bill also includes amendments which reinforce the polluter-pay principle and improve the accountability of the sustainable environment fund. In this bill we have succeeded in reducing the deficit without jeopardizing essential services. Meeting our fiscal objective of working towards eliminating the deficit will ensure that future generations are not left a legacy of debt. To do this, we have had to make difficult decisions to increase some taxes.
The bill includes the following changes. Effective April 1, 1993, the tax rate on natural gas used in pipeline compressors is increased to 1.9 cents per 810.32 litres. This is of historical significance. It also applies to natural gas used in internal combustion engines to run pumping stations of oil pipelines and is expected to raise an additional $7 million annually.
This bill also includes an increase to the tax rate on cigarettes. Members might remember that last year we didn't raise the tax on cigarettes, and this year I was reluctant to do so because we were concerned about smuggling. But we do have the best record in the country on the problems associated with smuggling of cigarettes, and we're very confident that as a result of some new tax-marking schemes we will be very much on top of that problem. The rate of tobacco tax is increased to $22 from $21 per carton of 200 cigarettes. The increase is consistent with calls from the medical profession for higher taxes to discourage smoking -- especially among young people -- and is also consistent with the legislative committee which is reviewing a similar kind of provision and demand to increase taxes on cigarettes. In addition, cigarette smoking is a particular problem that drives up the cost of medical services. So in a sense, this is a form of user pay.
[4:30]
The amendments to the Sustainable Environment Fund Act restrict the fund to only those revenues and expenditures related to environmental degradation. Because of the narrowed focus, corporate management of the fund by the cabinet committee on sustainable environment has been removed and the Minister of
[ Page 6581 ]
Environment, Lands and Parks will have sole authority over fund activities. I think this is important not only for accountability purposes, but also because when we have an environmental tax, as we do on rubber tires, we want to make sure that the revenue generated goes into dealing with environmental problems, particularly the environmental problem associated with rubber tires. I think that increases accountability, and I hope that it increases the acceptability of the tax. People have a problem when a tax is raised ostensibly for environmental purposes, and then the Minister of Finance or the government of the day uses the revenue for something else. This improves the accountability, so that revenue generated from environmental taxes goes into dealing with environmental cleanup or the problems associated with that, and the Minister of the Environment is the minister responsible for spending money out of that fund for those environmental purposes. The amendment reinforces the polluter-pay principle and improves accountability by strengthening the link between revenues and associated expenditures. I now move second reading.
F. Gingell: There isn't a great deal to this bill, but there are two or three issues that I would like to deal with. I'm clearly not worried about the problems of taking out references to leaded gasoline. I'll be interested to learn during committee debate exactly what the historical reference is to 810.32 litres. I was trying to work it out and thought that it might be one tonne. But I don't think it is a tonne; it's a little less than a tonne.
The issues that I think need to be addressed are that the minister, in his remarks just now, has spoken about the allocation of revenues from specific sources to accomplish specific goals. He was speaking about the revenues that come from a deposit on tires. But the minister is in the process of removing from the sustainable environment fund the automatic allocation of certain revenues to the fund -- I was under the impression -- not in this bill, but in Bill 5, I think it is. So those are two different messages.
[M. Lord in the chair.]
I have problems understanding if he is intent on removing specific funding exercises. The problem we have with special funds and statutory allocations of revenue streams to special funds is that the spending of the amounts raised does not come in front of this Legislature for debate. A little over $16 million will be coming into the sustainable environment fund in the year 1993-94 as a transfer and appropriation from vote 33. In addition, there is an amount of $24,700,000 coming in. This is the total amount of certain revenues that the government receives which, under the Sustainable Environment Fund Act, are deemed to be incoming revenues of that fund. So in the process of legislative debate, there is $16 million that we can discuss and $24 million that we can't or shouldn't. It seems to be an inconsistent and unsatisfactory way of arranging government finances when certain governments -- a government in this case in 1990 -- made a decision on spending initiatives that would carry on forever. It seems to me that it's the position of the Minister of Finance that he and the Lieutenant-Governor-in-Council -- the cabinet -- have the determination to decide what the budget is. Therefore I encouraged him in the past to collapse many of these special funds and to have the revenues that accrue to the special funds accrue to the government without any charge or hypothecation of them.
I don't know how I should comment on the fact that the Minister of Finance, in his wisdom, has decided to increase taxes on cigarettes. I understand what he's doing. I wish he would make the commitment that the additional funds raised would be spent on education and on programs to discourage young people in our schools from what my wife tells me is the filthy and disgusting habit of smoking. I see that he has increased the tax on pipe tobacco. I want to assure this House that we do not have any private arrangement that caused him to allow cigars on this one occasion to go through without an increase in tax. But I note it.
This bill is flawed. I know the minister has a great reluctance to changing sections of the bill, but it is flawed. The way it is written at the moment simply won't fly. During committee stage debate we will be proposing an amendment to section 7, because the "and" should come at the end of paragraph (f) and not at the end of paragraph (g). I'm surprised that the minister is so incompetent that he hasn't got that. At least, I hope that is the case; I am fairly certain that it should be after paragraph (f). With that major change that we will be seeking the support of the government on in committee stage, I thank you for the opportunity, hon. Speaker, to speak on this bill.
L. Fox: I rise to speak on the philosophy and principles of Bill 4. This legislation has several effects that are of concern, particularly the increased tax on an "internal combustion engine at a compressor station of a gas pipeline or a pumping station." I'm suggesting that the increased tax on the supply of natural gas is going to have a major effect on the residents of northern British Columbia.
Interjection.
L. Fox: The minister asks why. I'm absolutely surprised that he should have to ask that. He puts forward a tax that is going to cost one company alone -- Westcoast Energy, which supplies most of the gas to northern British Columbia -- $4 million. To whom is that going to be charged? I would submit that immediately they will be going before the Utilities Commission and applying for an increase in gas rates to offset the impact of this government's taxation. Winters in my community are longer and colder than in the south. In the winter months natural gas alone in my home costs about $225 a month. The impact, once again, is going to be felt by the northerners and those people who rely on this type of heat. It will have a far more severe impact on them than on the people in the south.
Let me go on to suggest that we should be encouraging the delivery of natural gas, not discouraging it
[ Page 6582 ]
through taxation, because it's environmentally friendly. If we continue to hike the prices, we will see people go back to other forms of heat -- perhaps not as the primary source but as a supplementary source so as not to pay increased gas bills. Many communities, particularly in northern B.C., are looking to do away with wood smoke and the other forms of delivery of heat because of the environmental impact on those communities. Now we see this government taxing something that was helping in those particular areas. I believe that's the wrong direction. The minister should have found other means rather than taxing something that encourages a more environmentally friendly form of heat.
Let's talk a little around the amendments to the sustainable environment fund. The previous speaker spoke about the dollars that are coming into that fund. I hope this particular initiative is finally going to see some movement. The Finance minister mentioned the issue of tires. Presently the sellers of tires have to look after the disposal of old tires when they're exchanged for new ones, but there's no process for disposing of them. We have piles of tires at tire shops and service stations around the province, with no way to get rid of them. I hope this will encourage the Minister of Environment to find a way of recycling them, because they're becoming horrendous in many rural areas of B.C., although not so much in the southern sectors. There's a means of recycling them when there isn't a large transportation cost attached, but to transport used tires 500 or 600 miles down to this process, which really doesn't have the capacity to utilize all the tires anyway, doesn't make a lot of sense.
As for the rest of it, being a cigar smoker myself on occasion, I appreciate that the minister didn't attack the smoking tax part of it.
Hon. G. Clark: Amend it in committee.
L. Fox: I thought that was where the leader of the Liberal Party was heading.
My key concern in this bill is that we are impacting a process and the delivery of a gas, which will have a strong negative effect on northerners versus southerners because of the climatic and living conditions. I really would have appreciated the minister looking elsewhere or looking at suspending versus putting more tax on northerners. I will be voting against this bill because I believe it's an unfair tax on some parts of the province.
Hon. G. Clark: To close debate, I appreciate the remarks of both opposition parties on this bill. I think we can give some comfort in committee stage to their concerns. I'll pass on the previous speaker's comments with respect to the Ministry of Environment and the question of surplus tires. That's a legitimate concern. As you know, there are horrendous problems in the eastern provinces with respect to the disposal of tires. Some progress has been made. If there are particular problems in the north, I'm sure this gives a revenue source which we can at least look at fixing.
[4:45]
With respect to the concerns on natural gas, I just want to remind members opposite that other provinces have forms of taxes that we don't, which were options we could have pursued. In Saskatchewan a 9 percent sales tax is applied to natural gas at the compressor site. Manitoba applies a 7 percent sales tax at the compressor site. We have 1.1 cents per 810 litres. It does raise some revenue. I want to assure the member that while some of this will be passed on to the producer, which I appreciate is a concern, we're still very competitive in that area, and we want to make sure that continues to be the case.
Secondly, some of that will be potentially passed on through the rate base, spread out through all of the rate base with respect to Westcoast Energy. The cost will be very modest indeed, if any, to the residential consumer. So while I do appreciate and take seriously members' concerns about the disproportionate costs associated with heating a home in the north, I think you'll find it's very modest with respect to this bill.
This is essentially not a principle bill where there's a large debate. This is one that we can better do in committee. I move second reading.
Motion approved on division.
Bill 4, Budget Measures Implementation Act, 1993, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.
Hon. G. Clark: Hon. Speaker, I call second reading of Bill 18.
MOTOR FUEL TAX AMENDMENT ACT, 1993
Hon. G. Clark: I don't want to move in a hasty way for the members opposite. I'm not attempting to do that. I was just saying to the Leader of the Opposition, who wasn't here, that I'm not attempting to move in a hasty fashion here. This is second reading debate on the Motor Fuel Tax Amendment Act, and I hope that doesn't give too much discomfort. It's a rather small bill and provides a number of amendments to the Motor Fuel Tax Act and the British Columbia Transit Act.
Bill 18 proposes a transit tax of 1 1/2 cents per litre on gasoline and diesel fuel purchased in the Victoria regional transit service area. I want to emphasize that the tax is introduced at the request of the Victoria Regional Transit Commission. The revenue from the tax will contribute to the local share of transit funding and will allow transit facilities and services in the region to be upgraded.
I will say a couple of things about that for members. When we took office, the government had a deficit in both the Vancouver regional transit area and the Victoria regional transit area. Victoria is not as serious a problem as Vancouver, because Victoria had a surplus in its account. It essentially had a stabilization account which they had to draw down. Nevertheless, the annual deficit would have accumulated. In addition, as members know, there is a lot of growth in this region and a lot of demand for improved bus service in
[ Page 6583 ]
particular as well as other transit services. So we had to fix that deficit question. The transit commission -- the local people -- had to make recommendations to the government on how to fix it.
A variety of things were proposed. One was that they suggested taking off the hydro levy and putting a very modest charge on property taxes. That, I think, is a very positive initiative which saves the taxpayers of Victoria $330,000 in GST payments alone and is very modest indeed on the property tax bill.
Secondly, they proposed a tax on gasoline, as we -- meaning as a Vancouver MLA or Vancouver resident -- have in the lower mainland. In Vancouver the current transit fuel tax is 3 cents a litre; this is 1 1/2 cents a litre here in Victoria.
I want to emphasize to members that from the provincial taxpayers' point of view, this is a very good agreement generally, although no one wants to see any tax increases. In terms of funding transit, I think a gas tax clearly has some linkage and some merit. The tax is half the rate of Vancouver and allows for -- I want to emphasize this -- a 25 percent improvement in bus service over the next five years, and as a percentage of the cost of transit the province's share declines very modestly. So what this does, even though it's a bit of a phony distinction because of the system we inherited from the previous government.... It's phony in this respect: the 1 1/2 cents a litre that we are asked to vote on today in this House is classified as a local share of funding. So this is the transit commission, local mayors and council members appointed by the government, albeit in this region, asking us to pass what is effectively a provincial tax and give it to them for their local share of costs. As reluctant as I am, as Minister of Finance, to do that, there is a real logic to gas-funding transit. They've asked for it. It allows for dramatic improvement in the service in this region, which is desperately needed, particularly in some of the congested areas -- the Colwood area and the like. Our share of the subsidy for transit, which is the largest of any province in Canada, does not grow with this dramatic increase in service. This sort of provincial tax share does not grow; it's largely supplied by this local share. In this case, the predominant amount is this 1 1/2 cents a litre.
I've talked a bit to give more comfort to members opposite. It's very positive. I must say there's been a lot of public debate in this region about this issue. This is not new; it's not a surprise to anybody. It's been debated extensively in the local community. It is not universally loved, and I acknowledge that very clearly. However, I would say that a majority of citizens in this region -- certainly their elected representatives -- see that we have to pay this deficit. This is probably the best way of doing so.
Bill 18 also proposes amendments to the Motor Fuel Tax Act to provide an explicit legislative basis for suspending or cancelling a person's authorization to colour fuel where that person contravenes the provisions of the act and regulations which govern the colouring of fuel. This is again taking the opportunity for housekeeping amendments to ensure that we have a legislative basis for doing what we are in fact doing and have been doing for some time, as the Ministry of Finance.
In addition, Bill 18 proposes amendments to the act to establish that a person who uses lower-tax coloured fuels for a purpose that is not authorized by the act may be assessed for the difference between the coloured-fuel tax rate and the clear-fuel tax rate. The proposed amendments respecting authorizations to colour fuel and assessments for unauthorized uses of coloured fuel are required to protect provincial revenue from losses that occur when the lower-taxed coloured fuel is used for unauthorized purposes.
A. Cowie: I wish to thank the Minister of Finance for giving us a few minutes to prepare for a brief reply. The Liberal caucus supports this bill in principle. In fact, the 1 1/2 cents per litre has been requested by the local authority, as the minister said. It's a bottom-up decision and a request to provincial government, shall I say. We believe in the community making those kinds of decisions. There certainly is a need for improvements to the bus service. As the minister says, it's projected that this will give a 25 percent increase in the quality of service to the local residents of greater Victoria.
It is my hope that these improvements to the bus service will be combined in the long run with improvements to rail transit, Mr. Minister. It's also very important. I've heard from the mayors and councils of greater Victoria. They would like to see transit improvements made over the next few years tied with land use decisions. So any transit money that....
Interjection.
A. Cowie: I'll just pause for a second, because I think this is a very important part of this bill.
Any money that comes in for improvements to transit should not be spent willy-nilly. I'm not suggesting the transit authority would do this. We recognize that the first moneys have to be spent on bus improvements. However, in the long run there will be a rail transit system in greater Victoria, and it's very important that major land use decisions about where future housing, commercial and industrial use will go are tied to that decision. It's a great opportunity if this money is spent in looking at long-range planning and in tying transit with land use.
With that provision, the Liberal caucus can certainly support this bill. We are, with a little caution, concerned about increasing taxes generally, but provided the money is well spent in long-range planning and improvements that will be made in the next short while, we can support it. With that, I will turn it over to any other members who wish to speak.
For the minister's observation, I am not going to comment on the coloured fuel aspects or any other housekeeping aspects of this bill, just the long-range planning and the fact that funds which are collected will be spent for that.
F. Gingell: Nobody likes additional taxes, and I'm sure the people of Victoria -- much as the minister protests that this is requested -- really don't want the
[ Page 6584 ]
additional taxes. It's important for all levels of government to recognize their responsibility to deliver the services required by our citizens at the lowest possible cost.
Late last year there was a report done for B.C. Transit which talked about the kind of savings that could be achieved. I haven't seen all of that report, but I believe it referred primarily to the Vancouver side. I'm sure that similar concerns, savings and improvements can be made on the Victoria side. Rather than always looking for more money from our taxpayers, we must be looking for more effective and efficient ways of delivering the services they need. I plead with the minister to pass that message on to the individuals who are responsible for the Victoria regional transit area, because simply increasing taxes is not acceptable.
If I may, I would also like to deal briefly with the coloured gas tax issue. There have been very substantial problems in the coloured gas area. The ones of which I have some knowledge dealt primarily with fuels being moved out of Alberta into Regina and Saskatoon, where there are so many farmers it is possible to get coloured fuels without a great deal of question -- not quite the same situation as in British Columbia. If we have laws, government and taxes -- and I guess we're going to have all of those things for some years to come -- we have to have fairness and equity, and it's important that everybody be treated the same way.
[5:00]
If these provisions allow the Minister of Finance and the people within his ministry to administer this act in a fair manner, to ensure that the taxes that are required to be paid are being paid.... If they are not being paid when they should be, then that is a burden that is placed on the law-abiding citizens of this province. Perhaps when the minister closes debate he might let us have a few words on the issue of enforcement and the need for it in British Columbia. As my hon. friend the member for Vancouver-Quilchena said, our party will be supporting this bill.
L. Fox: I don't find a whole lot within this bill to speak on, but an observation comes to mind every time the Finance minister stands up and talks about minimal impacts in terms of taxation. We've heard that statement so many times. Eventually, so many minimal impacts become a massive impact and there is, in fact, a tax overload. That's what we are presently seeing in this province, and that's why so many people are discouraged to the point of.... Well, I hate to say that they're taking part in any tax revolts, because those seem to have come and gone. But certainly the concern of people in B.C. is at what point this government is going to start looking at minimal cuts in spending rather than minimal taxation increases. I think that question is on the minds of virtually all British Columbians.
I don't profess to understand all of the concerns about the Victoria transit system. While I understand the process that has been gone through, I hope that the minister in drafting this is projecting it the way it was, and that he is respecting the wishes of the transit authority. That being the case, I certainly support it.
[E. Barnes in the chair.]
There is an issue with respect to the authority to colour fuel. While the Liberal leader touched on it, there is, besides the colouring of the fuel, the whole issue of who should have the authority to burn coloured fuel. This particular legislation, while it provides the authority to colour fuel and a penalty for not doing it correctly, doesn't give any definition as to who has the authority to burn coloured fuel. That's really the crux of the whole matter. That's where the individual gets into problems. There is such a grey area out there in terms of defining, for instance, what a bona fide farmer is or what particular road construction can or cannot use coloured fuel. On its own this will not really improve the aspect of who can or cannot burn fuel. It provides some authority for penalizing and for colouring it, but the major question still has to be addressed. With that, hon. Speaker, I will take my place.
R. Neufeld: I want to talk just briefly on this bill. My colleague brought up the fact, and so did the Leader of the Opposition, that it's another new tax by the NDP. As I've said many times, British Columbians have told me, and they have probably told the government, that they are tired of taxes. They are tired of increases in taxes. There is a multitude of small taxes that, in the end, take a large share from people who are trying to make a living. There may not be other ways to finance transit in Victoria. I know a good part of it's done this way in Vancouver. Like my colleague from Prince George-Omineca, I'm not familiar with the whole transit system on the lower mainland, but I realize that the transit system has to be put in place. In fact, there should be more public transit in the lower mainland to get away from the use of automobiles as much as possible. I don't think we'll ever get away from the use of automobiles in Canada or North America -- not for many years, anyway, because it's a love that North Americans have.
I would like to touch briefly on the coloured fuel amendments to the act. I am fairly familiar with it because I was authorized to colour fuel for 13 years as a bulk-plant agent for Petro-Canada. At that time, there were many representations made to government to....
Hon. G. Clark: Wasn't that a state-owned oil company?
R. Neufeld: It was a state-owned oil company that I joined when it was Pacific Petroleums; it was a private company.
H. Lali: Shame on you for working for a state-owned company.
R. Neufeld: I'm still working for a state-owned company. Anyhow, getting back to the coloured tax....
An Hon. Member: Coloured gas tax.
R. Neufeld: Coloured gas tax. Hon. Speaker, I guess it's been quite a day, hasn't it?
[ Page 6585 ]
Deputy Speaker: Yes. Now back to Bill 18.
R. Neufeld: Authority is given to the agent for the company to colour gasoline and diesel fuel, and that agent alone can colour fuel. It makes it very difficult at times, if you live to the letter of the law -- especially in the north where I come from, where things happen seven days a week around the clock -- for the agent to be there at all times to colour gasoline. It also becomes a hard call at some points to say who can really buy coloured gasoline.
I know many representations were made to government to withdraw the colouring of gasoline and diesel fuel altogether and to put the onus on the person buying it to reclaim the tax. I would rather see something like that, than repealing parts of the bill and substituting new parts to make it a little more difficult for everyone out in the field. After all, we do want to simplify government as much as we can, not make it more difficult. I would rather see that we did that, but I see the Finance minister does not want to do that. He wants to put in his own rules, or the government's rules -- just change some that were there before.
As we go through committee, maybe we can deal with each point more easily than trying to do it in second reading. With that, I don't believe I have any real opposition to the bill, other than to the addition of more regulation and the interpretation of that.
Deputy Speaker: The hon. minister closes debate.
Hon. G. Clark: I appreciate that today there was slightly less partisanship with the four speakers in the opposition. Maybe it's because they're all supporting the bill for a change. But let me try and deal with some of the concerns raised.
First, the Leader of the Opposition made an excellent point about looking first to the expenditure savings before we move on the tax side. Through the Crown corporations secretariat we commissioned a report on transit. I'm very pleased to inform members of the House, if they're not aware, that in the middle of last year we actually cut $20 million from the transit budget as a result of that review. I think that Mr. Denhoff, and B.C. Transit generally, deserve some congratulations for that, and now we have a CEO from the private sector.
As a result of that fairly dramatic cut, it has meant significant savings both to the province and to the local share. So the deficit in Vancouver has come down significantly, and a little bit in Victoria as well, as a result of those cuts. Can more be done? Yes, absolutely. I have discussed this with the new CEO. I've been very frank -- as I usually am -- that there aren't a lot of new resources there, so we're looking for increased efficiencies in order to improve public transit without additional tax resources. Having said that, we do still have a problem in Vancouver which we'll deal with, I'm sure, at some other time.
I want to pay tribute as well to the Victoria transit staff, because all of the reviews we've done with transit show -- and I don't mean this as a criticism of Vancouver -- that the Victoria transit operation is uniformly more efficient than the other major system in Vancouver. Just to give you one statistic, there is an average of 20 sick days per bus driver in Vancouver; 12 sick days in Victoria. Now, 12 is too high -- I don't have any hesitation in saying that -- but it's a lot better than 20. The morale, efficiency and cost in Victoria are quite a bit better than in Vancouver. There are arguments that say the reasons for that are that it's a smaller system, it's not quite as polarized and it's not as unwieldy. I don't diminish that, but I would just say that Victoria does a much better job. If we could obtain those levels in Vancouver it would mean millions of dollars in savings. We're obviously striving to do that and to do an even better job in Victoria.
I think the transit commission has done a good job here. I think the staff -- Mr. Lingwood in particular, who manages this operation here -- are doing generally a very good job. We are looking, however, for more efficiencies. I want to make that very clear. We have achieved significant efficiencies in transit. But more are needed, no question about it. Unfortunately, we need to improve service as well, with this growing population, so it requires this tax increase.
On the coloured fuel question, I appreciate the comments from members opposite who know more about this and certainly have more experience in this than I do. The Ministry of Finance sees a lot of various interest groups and the like. Often they're not happy or they want something. But farmers organizations as well as car dealers have made very constructive comments in this vein to the government in recognizing our fiscal circumstances. Farmers have suggested, for example -- the member opposite mentioned this -- that they issue a bona fide farmer's card, which they claim would save millions of dollars because of the leakage in the system and which would deal with who's a bona fide farmer. They would have to be approved. That's a bit of a private sector response, so that the government is not saying who is a farmer; the farmers' association is. I want to tell all members of the House that we're reviewing that suggestion very carefully. I think there are some pilot projects taking place, but I'm not positive of this. We're looking at that with farmers' organizations because there is a problem. We want to give a tax break to farmers with respect to fuel and to others who qualify. We do not want this to be broadly applied, because then it defeats the purpose and the money can't go to farmers who need it. Clearly this is increasingly so in Canada and British Columbia.
We are looking at all those options. The members point out quite correctly that this bill does not rectify all the problems. This bill helps to codify and deal with problems we have in enforcing the situation we find ourselves in today and in ensuring that it stands up to any legal challenges. The fundamental question of who is a bona fide farmer and who should be eligible is a more vexing and serious problem. This bill doesn't do that, but I want to assure members of the House that when I have the opportunity we will be actively looking at working with the industry -- if you will -- in trying to find better ways of making sure this is policed.
With that, I move second reading.
Motion approved.
[ Page 6586 ]
Bill 18, Motor Fuel Tax Amendment Act, 1993, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.
Hon. G. Clark: I call second reading of Bill 5.
INCOME TAX AMENDMENT ACT, 1993
Hon. G. Clark: I move the bill be now read a second time. I want to say that we have half an hour or so left, and I don't anticipate rushing this through second reading. Some members -- certainly the Leader of the Third Party, I know -- are suggesting that they would like to speak on this. I want to advise members of the House that we will begin second reading debate, but I'm giving some assurance that we won't complete it today. That's certainly not my intention -- to comfort all members on that question.
Bill 5 makes four major changes to the Income Tax Act. The bill increases the personal income tax surtax on higher-income earners. Some people have accused me of saying that people making a certain income are rich or well off. I want to assure members that this is not a subjective question. This is an objective question in this respect: the high-income surtax only applies to the top or wealthiest 8 percent of income earners. That is not a subjective interpretation or a political judgment. It's simply a fact that the high-income surtax only applies to the top 8 percent.
[5:15]
Secondly, this bill eliminates the renter's tax reduction. However, thirdly, it introduces a new refundable sales tax credit. Fourthly, it increases very modestly by half a percent, the general corporate income tax rate.
Bill 5 increases the high-income surtax for 1994 and subsequent taxation years. Both surtax rates increase by 10 percent. Of course, there's $50 less for each dependent. So we tried to deal with it on somewhat of a family bias, which the Conservatives have eliminated lately. The $60,000 is roughly the threshold for individuals. That means if you have a two-income family with $120,000, you do not pay a penny more in income tax for this budget. This applies to individual tax filers, which is one of the reasons the number is so small: 8 percent. It is not a family income surtax; it is a surtax on individual tax filers. And there's a $50 per person deduction for families.
This change to personal income tax will provide additional revenue, again to reduce the deficit and to maintain essential services. The tax burden is only increased for the top 8 percent of taxpayers. For those taxpayers paying both levels of the surtax, the increase in tax is an additional 3 cents on every dollar earned above $80,000.
Bill 5 eliminates the renter's tax reduction, effective for the 1993 taxation year. As promised in last year's budget, I remind members that the government reviewed the renter's tax reduction program. We had Mr. Audain and Ms. Duvall review housing options. They recommended eliminating this and putting it into a housing program, and that's what we intend to do. We will not receive any income from eliminating this renter's tax reduction until the next fiscal year. Mind you, we do not have an expense associated with the sales tax credit until the next fiscal year, either. The current Income Tax Act phases out the renter's tax reduction beginning in 1993.
The third change to personal income tax is the introduction of the refundable sales tax credit. The maximum credit will be $50 for each family member, to be phased out at a rate of 2 percent of the net family income in excess of a threshold level that varies with family size. The threshold level will be $15,000 for the tax filer claiming the credit, plus $3,000 for a spouse and each dependent.
I want to emphasize to the House that this credit will benefit 700,000 individuals and families in 1994 and will be provided on behalf of more than one million persons. For the majority of these recipients, the credit will more than offset the additional tax they will pay due to the provincial sales tax changes announced in the 1993 budget. As I say, 28 percent of British Columbians will have an actual reduction as a result of this.
The government is committed to ensuring that large corporations pay their fair share of the tax burden. Effective July 1, 1993, the general corporation income tax rate will be increased by half a percentage point. The general rate will be 16.5 percent. With this change, British Columbia is just slightly on the higher side of the middle of the corporation tax rates in Canada. Of course, we did not change the corporation tax rate for small businesses.
In summary, the income tax changes introduced by Bill 5 will help make the British Columbia tax system more progressive. The tax increases will be paid by those taxpayers most able to shoulder the heaviest burden, while the sales tax credit will protect lower-income taxpayers from the impact of changes to the sales tax.
F. Gingell: Mr. Speaker, I hope we can drag this debate out until 6 o'clock. In fact, I'm sure we can. I don't think there will be any trouble, because Bill 5 is a matter that we wish to deal with in some depth.
As the minister said, there are four main portions of this bill. On the removal of the renter's tax credit, we understand and appreciate the report done by Elain Duvall and Mr. Audain, but it is important for this government to recognize that people with low incomes need assistance in housing. I agree with this process. I agree that it is better to remove the renter's tax credit and to use those resources wisely and well in providing good low-cost housing. It is critically important for the people of British Columbia who are in the lower end of the income range, and it is something we support. We've seen the reduction in the tax credit. We haven't yet heard the way in which the government is going to use those funds -- the government's proposals to initiate the kind of work we must be doing in the provision of low-cost housing. This is important.
Number two. Yes, I appreciate, as the minister says, that the term "wealthy or high-income taxpayers" is an objective one that he has determined to be the top 8 percent. Nobody ever thinks, unless they are very well
[ Page 6587 ]
off, that they are a high-income earner. I am surprised that the minister puts the term "high-income taxpayers" into the act. It just seems to me that it has a little political connotation to it that we really don't need in our legislation. But this government and the federal government -- the federal government first -- are not dealing with the real problem and are pushing up taxes at a rate that is fairly substantial. The surtax has gone from zero to 30 percent of the provincial tax in three years, and 30 percent is a substantial amount. We're not dealing with the problem -- we're encouraging the problem.
It simply isn't fair that a single-earner family is taxed in such a different manner from a two-earner family. As an example, the minister said that two $60,000-a-year earners in a family will not be affected by this bill. I suggest that that $60,000 times two earners should make them no better off than a single-earner family that has an income of $120,000. But are they different? They are substantially different. You get to the point where the tax laws in this country do not encourage the family unit. They work to the detriment of the single-income earner with a spouse who stays home to raise the children, whether it's the male spouse or the female spouse. The tax treatment of those similar-income families is so dramatically different that it simply isn't equitable. We need to have income splitting, as they do in the United States, or some process to make this fairer. It just isn't fair now.
Interjection.
F. Gingell: I appreciate that it's a federal issue, but I would like to take this opportunity to encourage the Minister of Finance to talk to the federal Minister of Finance, not just about the immediate issues of situations like this, but the whole tax system. This country needs to have a royal commission on federal, provincial, regional and municipal taxation. Our tax laws and our tax system have gotten so complicated and create such a ridiculous bureaucracy to administer that we're just pouring resources down the drain. Clearly, the time has come to wipe the blackboard clean and to think about the responsibilities of the federal, provincial, regional and municipal jurisdictions and the kind of funding that is most appropriate for their needs, and not go through all these ridiculous transfers that require major bureaucracies to administer them. I don't approve of these tax increases. I think they're just pushing us in the wrong direction.
The bill introduces the refundable sales tax credit. A refund of $50 is reduced by a certain percentage, so that by the time someone earns $17,000 the tax credit is gone. It's another one of these gimmicks -- and it really is a gimmick. I know it does help, because you're able to talk about 28 percent of total taxpayers, but it's a gimmick. It adds another paragraph to the Income Tax Act. It adds another line to the income tax return. A person will probably have to spend $50 to go to H&R Block or somewhere else to get them to fill in their income tax return. We need to have a simpler tax system, and the minister should not be making it more involved.
Perhaps he should just... I won't make a suggestion now.
Interjection.
F. Gingell: How many?
Hon. G. Clark: Fifty million dollars.
F. Gingell: Fifty million dollars. A million sounds high.
It just is a very complicated and complex exercise and makes the act more complicated than it was before. It's time to simplify things, to find better ways of making transfers to people than through gimmicky exercises through the tax act.
We've now got the corporate tax rate for the province only -- we recognize it's for the province only -- added to the 25 percent base tax rate for the federal government. It's now up to 16.5 percent. In the last three years, the minister says, it's only been half of 1 percent, but of course, we all know that it's really about a 4 percent increase from 16 to 16.5. My notes tell me that since 1990 the corporate tax rates for the province have gone up by 17.8 percent.
Interjection.
F. Gingell: I don't know whether it's lower than it was under Bennett, but it's 17.8 percent higher than it was under the previous administration, and we won't advertise their name. We'll keep that private to ourselves.
We cannot support this bill. We appreciate that it is a bill to enact budgetary measures that were brought forward in the presentation of the budget by the minister. We didn't support that, and we won't support this.
I move adjournment of the debate.
Motion approved.
Hon. G. Clark: Hon. Speaker, I call second reading of Bill 13.
INCOME TAX AMENDMENT ACT (No. 2), 1993
Hon. G. Clark: Bill 13 proposes a number of amendments to the British Columbia Income Tax Act. Primarily, these amendments are required to maintain harmony of the provincial and federal tax systems, as a condition of the Canada-B.C. tax collection agreement.
[5:30]
This is -- and I mean it sincerely -- housekeeping legislation. Bill 13 parallels recently enacted changes relating to the federal government's changes, which is a requirement of our reciprocal tax agreement. Revenue Canada gives greater discretion in administering taxpayer inequities -- for example, extending the time limitation for taxpayers to claim statute-barred refunds.
While the net impact of the federal changes is minimal, without the proposed changes to the British
[ Page 6588 ]
Columbia legislation, Revenue Canada does not have the proper legislative authority to administer provincial income tax on the basis of the new rules recently enacted by the federal government. The proposed amendments under Bill 13 resolve this problem and are retroactive to the effective dates of the federal changes.
Additionally, and this is perhaps more significant than housekeeping, Bill 13 exempts the Vancouver International Airport Authority corporation from British Columbia income tax. The authority is a non-profit corporation. What we have done, essentially, is support the privatization of the federal airport. This bill leaves them with the same tax status that they would have had, had they still been run by the federal government. It's no revenue loss to the government in the sense of what we had previously, although there is a revenue loss in the sense that we are exempting them from income tax.
Interjection.
Hon. G. Clark: Well, we can debate this, and maybe you can convince me otherwise.
In July 1992 the responsibility for operating the Vancouver International Airport was transferred to the authority from the federal government. At that time, I want to emphasize, the provincial government agreed to provide certain tax concessions, including an exemption from provincial income tax. These concessions ensure that tax treatment of the airport will not substantially change simply as a result of the transfer from the federal government to the airport authority.
In return, the authority agreed to establish a joint advisory group with the province to consult on potential expansion and other developments at the airport. This advisory group has now been established. This income tax exemption is retroactive to 1992, the year the responsibility was transferred from the federal government.
In short, we simply maintain their tax status as if they continued to be a federal agency. As all members know, the expansion of the airport is of vital importance in terms of expanding economic development in the province. We clearly need expansion. We clearly need improved services at the airport. I must say that I'm very impressed with the new organization. Mr. Emerson is, as you know, the CEO. We've tried to make an accommodation here to ensure that that is a successful undertaking. We think it is a net economic benefit to the province.
With that, hon. Speaker, I move second reading. At this time I would move adjournment of the debate on this bill.
Motion approved.
Committee of Supply A, having reported progress, was granted leave to sit again.
Hon. G. Clark moved adjournment of the House.
Motion approved.
The House adjourned at 5:35 p.m.
The House in Committee of Supply A; D. Streifel in the chair.
The Committee met at 3:23 p.m.
ESTIMATES: MINISTRY OF ENVIRONMENT, LANDS AND PARKS
(continued)
On vote 32: minister's office, $375,354 (continued).
J. Tyabji: I'd like to start with the chart that was provided by the minister's staff. I'll start by saying thank you very much -- that helps out. It raises more questions, however. I'm hoping that the minister and his staff have a copy of the submission that was given. As is outlined here in the relationship between the protected-areas strategy and CORE, there seem to be essentially three streams of committees: the Commission on Resources and Environment as a stand-alone stream, which we know has the three regional committees; then underneath the Cabinet Committee on Sustainable Development we have one stream.... The protected-areas strategy assistant deputy minister is where the first question comes in. I assume that's an Assistant Deputy Minister of Environment who is taking over. The way that's worded....
Hon. J. Cashore: Would you like that clarified?
J. Tyabji: Yes.
Hon. J. Cashore: That's the assistant deputy ministers' committee, so it's in the plural.
J. Tyabji: Underneath the committee of the assistant deputy ministers for the protected-areas strategy, we have an interagency management committee. Am I to understand that that is the committee responsible for the interministerial workings and communication with the other ministries, such as Forests and Agriculture?
Hon. J. Cashore: That's all outlined in the covering document that we circulated. The assistant deputy ministers' committee that was referred to in the first question includes representatives from the Ministry of Environment, Lands and Parks; Forests; Agriculture, Fisheries and Food; Economic Development; Tourism; Aboriginal Affairs; and Energy, Mines and Petroleum Resources. It provides broad policy direction to regions on such issues as the amount to be protected in each region; what ecological, recreational and cultural criteria have to be met for any area to be considered; what assessments will have to be done before any area can be proposed; and an analysis of
[ Page 6589 ]
what ecological areas are not well-represented in the province. In each region an interagency management committee, which includes representatives from the resource ministries at the regional-director level, has the role of coordinating a collection of information for the use of the CORE table and conducts assessments on presented candidate areas for protection. So the inter-agency management committee is at a somewhat lower level in the public service -- it's at the executive level of the various ministries -- and their work is more related to the work of the CORE table.
J. Tyabji: I have read through all this, but I'm not clear whether we are saying that the committee of the assistant deputy ministers.... Actually there's a grammatical error there that is a bit misleading, because you've got minister's, and it should be ministers' -- so that it's plural possessive rather than singular.
Hon. J. Cashore: My apologies.
C. Serwa: That's pretty serious stuff.
J. Tyabji: Well, it was misleading because it looked like one assistant deputy minister.
Hon. J. Cashore: I agree.
The Chair: Could we have the debate through the Chair for the clarification of the committee and for the efficient recording by Hansard.
J. Tyabji: Thank you very much, most honourable and venerable Chair....
The Chair: As long as I'm not vulnerable.
D. Lovick: And the common denominator is "-able."
Interjection.
J. Tyabji: This is definitely the silly season.
With regard to the handout, we've got a committee of the deputy ministers of the ministries that are listed, and then we have regional directors. Are those regional directors from the same ministries listed? They are, okay. Is it one interagency management committee at the provincial level, or am I to understand that there is a committee in each of the regions?
That ties into the other question regarding the regional protected-areas teams. If your regional directors are on the interagency management committee, who's on the regional protected-areas teams? This is like a baseball thing: who's on first, and what's on second, and...?
Hon. J. Cashore: The sentence begins with the three words "in each region," so the answer is yes. The hon. member has read that correctly.
J. Tyabji: First of all, how many people are on the interagency management committee? I guess I'll just have to count the ministries. Who's on the regional protected-areas teams?
[3:30]
Hon. J. Cashore: Members of the staff of various ministries, as assigned by the interagency management committee.
J. Tyabji: How many people would be on a regional protected-areas team, and how many teams currently exist?
Hon. J. Cashore: It is based on the forestry regions of the province, so I believe it's eight. It could be six. I'm just not sure off the top of my head the number of forestry regions in the province, but it's based on the forestry map of the province. The question of how many staff within those teams: it varies, but between four and eight.
J. Tyabji: When we go to the third stream, as outlined on the organizational chart, we have the protected-areas committee team to provide Victoria's support to the protected-areas assistant deputy ministers committee. I'm wondering what the difference is between the protected-areas committee team and the interagency management committee. For the minister and the minister's staff, the reason I'm asking these questions is that when we pursued this line of questioning originally, I was trying very hard to understand why there are so many committees when they seem to be doing almost the same thing. We have the Commission on Resources and Environment with three regional committees. We have the protected-areas strategy with committees of the assistant deputy ministers. Now we find that there is an interagency management committee, the regional protected-areas teams and then a third line with the protected-areas committee team and a project office.
It seems to me that at the very least you have a duplication in the protected-areas committee team, because there seem to be two things underneath the protected-areas strategy that could deal with that. I'm not sure how this works out, but it seems like a very cumbersome structure and that there may be a heck of a lot of staff involved. From my own experience of how these things work, it is generally speaking very difficult to develop enough communication when you have so many different groups working on the same mandate.
Hon. J. Cashore: The protected-areas committee teams are the directors of the committees working in Victoria. So they have a generic role with regard to the entire process on a province-wide basis; they are not duplicating. The interagency management committees are at the regional level.
J. Tyabji: If the interagency management committee is made up of directors on a regional level, and a protected-areas committee team is made up of directors based in Victoria, wouldn't it make sense that they would coordinate their activities, that the regional
[ Page 6590 ]
directors would be funnelled through that, and that it would in that way be streamlined?
Hon. J. Cashore: The answer is no. It's all coordinated through the project office, which is the next one down on the right-hand side of the flow chart.
J. Tyabji: I wonder if it would be possible to get a breakdown. I don't need it right now for the debate, but I'm still a bit unclear as to how many people are involved in this whole thing and what it costs. That's what I'd like to get to. It would be helpful for me to have a better idea of what it is they're doing. Right now, based on the two-page outline that comes with this, it doesn't seem to me that there's enough distinction between what they're supposed to be doing. In effect the protected-areas strategy team seems to be doing what CORE is mandated to do, except that CORE is more of a public process that takes in all the stake-holders and members of the public, whereas from what I can see of this, the protected-areas strategy is less a public process and more a staff process. That being said, if it would be possible to get a little more clarification, and if there is a public process with regard to the protected-areas strategy structure -- particularly the interagency management committee and assistant deputy ministers' committee -- I'd be interested.
I think in our previous discussion the minister mentioned that the regional protected-areas teams do the legwork -- here it says "do the legwork and assemble the relevant ecological, recreational, cultural and economic data" -- and that recommendations can be made through the interagency management committees. However, the difference is that in CORE there must be a public process, but in the protected-areas strategy there may be a public process. I'm not sure, but I still don't understand how there can't be overlap here.
Hon. J. Cashore: With regard to the costs, we have budgeted $800,000 within Parks for protected-areas strategy work, but given that there are other staff members involved at various levels in the regions and from Victoria, it's also true that work is done sometimes off the side of the desk -- as the saying goes. It is very difficult to quantify given that it's work that's done along with the regular job descriptions of line staff. The hon. member is asking about assurance that there not be duplication, but I'm not clear on that question. So if she wants to ask it again, I'll endeavour to answer it.
J. Tyabji: If CORE is mandated to develop a comprehensive land use strategy for the province through a public process that involves all the stake-holders, the public and all the groups that are interested in having a submission, and if the protected-areas strategy is mandated with developing a conservation strategy within the 18 percent of the province that's outlined on the preliminary map without a public process -- but possibly a public process -- there are two different structures in place. I don't understand how there can't be overlap, because the protected-areas strategy automatically falls under CORE's mandate.
Hon. J. Cashore: The protected-areas strategy is part of a policy framework within which CORE makes the land use decisions; therefore this is not overlap. It's guidance that is given to CORE. The very structure itself is designed to avoid overlap and provide guidance.
J. Tyabji: CORE is, by definition, a public process and something that stands alone from cabinet. If you ended up with the public process coming forward with extremely strong recommendations on land use strategy for the province that were in opposition to the protected-areas strategy, which already has 18 percent identified with 12 percent guaranteed to be put aside, and the protected-areas strategy is based on the best scientific, ecological, environmental.... Let me see, just so I read it out properly. We've got ecological, recreational and cultural criteria. So on the one hand you have a lot of staff, a lot of excellent resources and a lot of brains focusing on translating data into a land use strategy. On the other hand, you have a public process where you may also be collecting input from the public -- well, you would be -- and you end up with two different maps. The protected-areas strategy is only a recommendation, but the CORE is a public reporting process. I think there is a chance for conflict.
Hon. J. Cashore: The beauty of this process is that it is designed so that can't happen, and that's watertight. It simply won't happen. The protected-areas strategy works closely with CORE, and CORE sits with the ADMs' committee. So it's not a case of the right hand not knowing what the left hand is doing; it's a case of both these entities being dovetailed and designed in such a way that there are no surprises.
J. Tyabji: My thanks to the minister. However, my understanding is that the very nature and purpose of CORE is to have it separate from government, a public process that cannot be driven by cabinet. I remember that legislation very clearly, and it said that although CORE is to report publicly to cabinet, cabinet cannot influence CORE. CORE is to be owned by the public, and that that's how it's going to happen. It's going to have certain things allocated to the short term, but the long-term mandate is a comprehensive land use strategy. Since the government cannot drive the CORE process and the public can, but the government is putting its resources toward the land use strategy based on staff collection of data and a staff land use strategy, I'm wondering what happens if and when -- as may very well be the case -- we end up with a public process where the map looks very different for the protected-areas strategy. The map for the protected-areas strategy came out over a year ago.
Hon. J. Cashore: Hon. Chair, that's absolutely incorrect. CORE makes recommendations within the context of government policy. Therefore what the hon. member is describing can't happen. The fact is that the policy includes the protected-areas strategy, so it's designed in such a way that it's not overlapping.
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There can be a number of processes where government sets up a commission, and it has to be designed so that the commission can work with various agencies of government. It happens all the time. It's part of the process to have public servants assisting and designing, so that those processes can dovetail. There is nothing unusual or sinister about that, and there is no reason why it cannot or will not work.
J. Tyabji: I'm not trying to imply anything sinister; I'm just saying that I believe there is a potential conflict down the road. As I understand the minister then, the CORE process, which is a public process, has to work within the confines of the protected-areas strategy, as originally outlined about a year ago -- in general terms. Or is it -- as I understand it -- that if the CORE process came up with something outside the bounds of the protected-areas strategy, the CORE process would prevail? Based on what I'm hearing today, the government policies are going to be the framework through which CORE operates. That's something that I haven't heard before.
Hon. J. Cashore: This line of discussion could possibly go on and on. I just want to say that it's designed in such a way that there will not be conflict; there will not be a situation of the right hand not knowing what the left hand is doing. The protected-areas strategy guidelines have not come out yet. There is more information coming out very soon with regard to the protected-areas strategy. CORE is in the context of a mandate that has been given to it by government. That is consistent with government policy, as is the protected-areas strategy, as are all the other processes that are working with regard to land use in the province.
J. Tyabji: I'd like to leave that for now. If there is some more information that might help in an understanding of how there won't be a conflict, I'd very much appreciate it. At this stage I'm not convinced.
If we could go back to the report on the environment, I'd like to more or less finish with that today, if we can get through it. There are some general concerns that I have with it and some questions with regard to potential restructuring of some of the ministries based on the information.
I'd like to state, as I have before, that I think this is an excellent initiative and a very thorough overview. It's well researched, and that's very handy. I'm a little bit concerned that in some cases I've noticed that some of the references with regard to the data that's available -- and I'll get to them a bit later -- have come from industry. For example, later on we'll get into potential groundwater contamination from some industry emissions, and the study to show that there wasn't contamination was commissioned by industry. That's the only kind of concern that I have: when there's no independent data used for the conclusions brought forward in the report -- just as an aside. I do recognize that in B.C. we don't have a lot of independent data; that sometimes we do have to go through the route where industry basically is reporting on itself.
[3:45]
I believe that we had pretty well canvassed everything up to about page 12, and that would take us into the acidic deposition and some of the potential problems with particular contaminants and air quality. So that's where I would like to start.
Last year we spent a lot of time on new technology and alternate methods of technology, and I had asked a number of questions about research and development. I notice here that many of the things that they're talking about with regard to car and industry emissions are things for which there is currently a technology that can deal with that. I know that this morning there was a lot of canvassing of air emissions. I do recognize that the ministry has been trying to deal with these things and has been bringing in some regulations, and that it does take some time.
I know that the member for Powell River-Sunshine Coast wants to talk a little bit about what happens if an industry is planning to shut down in a few years and so is in non-compliance until then.
What I'd like to talk about, very briefly, is whether the ministry has had any discussions with some of the high-tech companies in British Columbia. For example, companies like Ballard Power Systems put British Columbia on the leading edge in the world with regard to alternative technology for transportation. I had brought up a few of these things last year. Have there been any discussions about whether there might be some pilot projects, or some encouragement to small business in B.C.?
Hon. J. Cashore: This is one of the questions I was really looking forward to, because Ballard Power Systems is British Columbia's story that has so many positive aspects that it's incredible. Ballard Power Systems, which I believe is now on the North Shore, has about 90 full-time employees. They are developing hydrogen fuel cell technology that is directed, in the initial phase, to a hydrogen fuel cell bus. They have a prototype bus that is one of the vehicles in the bus fleet here in the lower mainland. The back one-third of that bus consists of the fuel cell and three computers used to iron out the bugs in that technology. Ballard, I understand, is at least two years ahead of any other consortium in North America seeking to develop this type of technology.
Just before I went to southern California to look into some air quality issues there -- including, among others, the South Coast Air Quality Management District -- I availed myself of the opportunity to attend the Ballard site on the Friday evening before I left. They took me for a ride on the bus. That was a transforming experience, because it was like being at Kitty Hawk -- really! I couldn't have imagined the enthusiasm I would find there among the workers at the Ballard plant. They have this infectious enthusiasm, given that they realize they're on the cutting edge and producing something that is going to be the future.
Ballard Power Systems is now in phase two of their activity, which means they've gone through the basic workup. It was painstaking, visionary work on behalf of the people behind Ballard. They're now into phase two, which involves ironing out the bugs of this
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prototype and then getting the prototypes out into various cities in North America.
When I was in California and met with the South Coast Air Quality Management District, I managed to secure a letter of intent from South Coast agreeing to enter into a partnership with Ballard to the tune of at least $250,000 a year for the next three years. It could be more than that. I expect it will be more because, as you know, South Coast is in a regime that, due to regulation, is having to address the issue of zero-emission vehicles at both the domestic vehicle and bus stages.
When in California I visited the city of Los Angeles bus repair depot, which is a mammoth operation. In that location they were experimenting with about five different types of alternative fuels in their buses. They're eagerly looking toward the time when they will have a Ballard-fuel-cell-powered bus on the streets of Los Angeles. They'll have a big sign on there indicating what it is, as they do on the bus that travels around North Vancouver now.
But it really is possible -- and I would encourage all MLAs and staff to do this -- to go for a ride on a zero-emission bus. It is true that at present the hydrogen energy is coming from natural gas. Eventually it will come from water; that's probably several years from now. But this is a massive step in the right direction. I appreciate the hon. member recognizing the importance of this technology.
I just want to say a bit about my sense of a philosophy of the environment. If we look to a machine as a resolution of our environmental problem, that's a mistake. That's the idea that we can have a technofix and solve all our problems through technology, which we can't. You have to have the public will and the political will to get people onto the bus -- to get people recognizing the importance of using public transit systems to transform a way of life so dependent on the independence of the automobile.
The Ballard fuel cell is going to be producing economic benefits in job creation for British Columbia that I think are going to be enormous. It will be in partnership with California, where there will also be job creation. I think we're going to see more of those kinds of partnerships. It will be a result produced not solely by technology but by a partnership among a public that is knowledgeable on the environment, industry that is coming up with truly appropriate technology and government that is willing to facilitate but not get in the way.
J. Tyabji: I'm very encouraged to hear that the work of companies like Ballard Power is being recognized by the government.
When we were in debate on Bill 3, the Build BC Act, one concern I brought up then that I'd like to bring up now, and then ask a question, is that I think we are going to see a major transformation in transportation. I think B.C. will lead the way in that. Companies like Ballard Power are just one example. With that transformation in transportation, when we are looking to the existing infrastructure, for example, the Lions Gate Bridge and the problems the lower mainland is facing with regard to commuting and air quality.... Anyone travelling to or from the lower mainland can see the haze that sits over the valley, in large part a result of vehicle emissions. Vehicles like the ones Ballard Power is developing won't be contributing to this.
Is there some kind of long-term plan by the Ministry of Environment in conjunction with the Minister of Finance, because of his having the portfolio for transit, to move away from massive traffic problems and move toward these alternative vehicles with some kind of incentive for the public other than a straight environmental one? Is the Ministry of Environment doing anything to try to coordinate a green transit program, for example, something that will tie in with your clean air strategy and the other things you are trying to do?
Hon. J. Cashore: The answer is yes. It involves many different agencies in government: Finance with regard to issues relating to transit; Economic Development, Small Business and Trade with regard to issues relating to the development of technologies that assist us in clean air approaches; Energy, Mines and Petroleum Resources with regard to some aspects of the alternative fuels and how that area is developed; and Environment, Lands and Parks, for obvious reasons.
To give one example: given that the Ministry of Environment, Lands and Parks to some extent -- not in its totality, but to some extent -- is a regulatory ministry, we are sometimes cast in the light of being anti-business when we put regulations in place. On the contrary, all you have to do is talk to the Environment Industry Association. When they come through my open door, what they are saying is that they need to see more regulations, because when we bring in regulations, it creates business opportunities for them. That has to be done with diligence and wisdom but is nevertheless the case. When we implement good regulations with effective enforcement, we provide a potential market for companies in the environmental field.
A number of partnerships interact to be able to bring about some of these good policies. However. just as the state-of-the-environment report gives both good news and bad news, I would like to say that the good news is that these issues are being addressed on a number of fronts, and the bad news is that while we have a goal that we want to improve the quality of the airshed significantly, I think we have only succeeded in leveling off the graph. That is an accomplishment, in view of population growth, but we haven't yet reached the point where we are seeing that graph coming back down. I say that in all candour. That has to be something that takes the political will of this ministry and this minister, and of other ministries and ministers. Indeed, the public mind-set is an enormously important part of that as well.
J. Tyabji: I'd like to congratulate the minister. That sounds very encouraging. I agree that there has to be political will, but more than that the public has to be aware of its role in this. There is a lot of goodwill on behalf of the public, and they need a little bit of leadership. There should be some way there can be a
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little bit more awareness of what is going on in terms of, for example, a move away from traditional methods of transportation to some initiatives that are coming forward. One reason that I bring this up is because from my perspective, in the next couple of years, some of the issues will be faced by this government. In the lower mainland we see the Lions Gate Bridge already at capacity with regard to transportation, and a real movement afoot to build a second bridge or something else. It seems to me that when you create the avenue for people to drive more easily, you will get more traffic, whereas if there were some kind of environmental initiative for mass transit that was extremely accessible and effective, it could perhaps change people's patterns of doing things.
With regard to the comment about environmental industries, the good thing about the addition of new environmental industries to environmental regulation is that they're locally owned. Most of the environmental industries that come forward are the small and medium-size British Columbia businesses that stay and work in the province. There are oil filter recovery places, recycling plants, composting businesses and the things that we've talked about before, which are obviously the next generation of free enterprise in the province, and which will be a green form of free enterprise.
It would be useful to have more information on some of the interministerial initiatives like a green transit or some kind of vision 2000 for the environment. This could be shared here or in a memo. It would be extremely useful because right now there seems to be either a news or an information blackout on them. If I hadn't asked the question, I wouldn't even have known that this is going on. So perhaps the minister could share a little bit about that.
Hon. J. Cashore: There are frequent news releases going out, news conferences and public statements, and all of these releases do go to the hon. member. An example of one -- I think was very well received -- was the regulation on ozone depleting substances, which the hon. member didn't mention just now but I'm sure that she was aware of that, and that this was a very significant and positive announcement.
Also, the Ministry of Environment, Lands and Parks participates in the Go Green campaign in the lower mainland, which involves the regional district, Environment Canada and Transportation and Highways. Again, that is attendant to the remark I made a little while ago about the fact that we've managed to level off in terms of the air quality, but we haven't really got the improvement that is the goal -- yet.
[4:00]
But there is a degree of success, due to the participation of people like Prof. Douw Steyn from the University of British Columbia, who is an air quality expert; and Dr. David Bates, who's retired but working 16-hour days addressing health issues that relate to the ozone levels, and who has drawn our attention to the impacts on the health care system as a result of instances of respiratory illness showing up at the doors of emergency wards during air inversions. There are a lot of efforts going through the Go Green campaign that are working on public awareness on transportation alternatives. So, hon. member, these issues are being dealt with on a number of fronts, and we will make up a package of the releases that we've already sent out and make sure that you have a chance to read them again. We probably have some other information that we'd like to send you on that too.
J. Doyle: Do we as a province or as a country have any ironclad agreement -- or any kind of agreement -- that with free trade or NAFTA, B.C. waters would not be diverted to the United States or south of the border?
Hon. J. Cashore: This question is properly put to the Minister of Economic Development, Small Business and Trade where it's dealing with a trade issue. With regard to the environmental aspect of that question, I have extended the moratorium on coastal bulk water exports that was instituted by the former Minister of Environment -- who is in the chamber at the present time -- who did so at my urging, I might add. I might add. I extended that moratorium until May 1994. In the meantime, we are going to be coming forward very soon with a paper on restoring the water resource. Part and parcel of that process will be to review the entire issue of water exports in the light of various trade initiatives. There is some very real concern about some of the assurances given by the federal government with regard to water not being a good and therefore not being subject to NAFTA. Some of those assurances are cold comfort, and there are legal opinions from a well-known Liberal, Wendy Holm, and others, that we cannot really trust those assurances.
Therefore I have no hesitation in stating my own personal opinion on that, which is that I am adamantly opposed to the export of water from this province in any way, shape or form -- other than as value-added job creation in a bottle. Somebody's going to say: "Define a bottle." I guess you could produce a bottle that would carry several hundred thousand litres and put a cork in one end. No, we're talking about water as a value-added product that creates jobs here, instead of shipping our water south of the border where somebody can create jobs down there, using our water. We don't want to see that happen.
There are a number of issues that have to be looked at, and one of them includes the grandparenting, possibly, of present arrangements that are already underway. Again, that is one of the questions to be considered. That's not a decision that I am saying is a decision, but it's one of the issues that has to be considered. I think we have to look at this issue in the context of the potential for enormous environmental impacts. One doesn't need much of an imagination to think of the possibility for the tanker traffic that we brought into Toba Inlet alone. If the licences that have been applied for in that one inlet were granted, some estimates are that there would be as many as 200 medium-sized tanker movements a year, which I think would be unacceptable to most British Columbians.
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With regard to interbasin transfers going down into the States, such as the project that we hear so much about, I would say that I am adamantly opposed to that. I cannot see any justification whatsoever for us to take that kind of risk with our resource, when water is so important to British Columbians and when it's so unnecessary to do so. I think to do otherwise would be imprudent. You know, we often hear some controversy -- and I know this isn't my area -- about the export of raw logs. Here we have the opportunity to do it right, where we don't start a raw log or raw water export process but we look upon it as value-added job creation.
J. Doyle: Does the ban on water exports by tanker include water in the interior?
Hon. J. Cashore: No, it doesn't. That policy direction is going to emerge through the discussion paper process that I have outlined.
C. Serwa: I have just a few quick questions on that particular topic, because it is a very important topic, as the hon. member for Columbia River-Revelstoke has brought up. The minister has confirmed that. It's my understanding that under the British North America Act, the Constitution Act, water is within the jurisdiction of the province. The only federal influence on that is that fish are a federal jurisdiction reserved under the BNA Act, and that's where they have some influence in the pollution aspects of provincial water: lakes, streams, rivers, etc. With that in mind, there is no way that any agreement written by the federal government can force the provincial government, to the best of my knowledge, to export water in bulk shipments or in diversions. Is that correct or not?
Hon. J. Cashore: Hon. Chair, I will not presume to give a final answer to that question, but I will say that the question is of such enormous import that it behooves us to be extremely cautious and get the best possible legal interpretation in the context of developing our policies.
Also, with regard to what the hon. member says about the BNA Act and the federal-provincial relationship with water, I think that we have to be very vigilant here and recognize that the present acts under which water issues are addressed, to my understanding, are the Fisheries Act and the Navigable Waters Protection Act -- which are federal acts. There are also issues that relate to the whole environmental assessment question that come into this equation as well.
It's our understanding that the other issue is that the federal government has certain jurisdiction with respect to trade issues. Therefore, very understandably, there's a deep concern over the unilateral way in which the federal government proceeded on the NAFTA equation without bringing in the provincial governments at the earliest stage so that there would be a complete consideration of those provincial resource rights before the federal government starts bargaining away our historic rights.
C. Serwa: Just one last question. There are a number of licences already out for a considerable volume of water from sources that empty out into the Pacific Ocean. I imagine that the source is Ocean Falls -- is that correct? -- and is fairly heavily licensed. Personally, I'm very uncomfortable with that particular licensing in place at the present time. Nevertheless, it is there, and I don't know what the government can do. I guess I have a real concern in that under the free trade agreement -- and we're talking agreements -- if we charge a firm price for water for export, apparently we have to charge the same price as electricity for export. There has to be some relationship to volumes and to price, and if there's a cutback, then we have to cut back our own consumption as though we're intending to cut out the amount for export. Is there anything that can be done to the existing agreements so that they can perhaps conform to or comply with the new draft regulations or guidelines that the ministry is looking at?
Hon. J. Cashore: I don't have the answer to that. We're putting together a plan to address such questions. That's a very good question; it's an important question.
C. Serwa: We were under considerable pressure from, I think, the Goleta water board in California to export water. Since that time, I've stopped in on a trip down there and talked to engineers. They have done a great deal of work themselves, recycling used water and irrigating -- with a dual-pumping system -- green areas, ball diamonds and park areas with recycled water. But in spite of the type of pressure -- and certainly this past winter has, I guess, filled the reservoirs -- they still have not succumbed to the necessity to use other things such as waterless toilets. There are still many things that they can do. I'm always concerned that if the areas that create the problems don't address the problems they create, then by simply exporting, we only expand the type of abuse and the problem. So I will look forward with a great deal of interest to the ministry guidelines. I'll peruse them very closely when they come out, because they will have a tremendous impact. And I guess if we can agree on anything -- and it's a pleasure to agree occasionally -- it is that this is a most vital and important subject for the future of British Columbia.
Hon. J. Cashore: I appreciate that and the fact that this minister prevented, if you will, opening the floodgates at a time when there was a great deal of pressure. If necessity is the mother of invention, it seems to be a short-lived learning, because when I was in California in March the hills were green, the reservoirs were filling up and I guess the necessity was going away. I don't think we can be smug about that in British Columbia. We have to start here and take a look at our own habits. For instance, consumers could chose to purchase toilets now on the market that use a fraction of the water per flush that most toilets use. There are many other ways we should examine our own approach to water and our own ethic of conservation.
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J. Tyabji: I've been listening with interest to this, but actually there are other things I want to bring up. I'm trying to keep to the report so we can go through it in sequence.
I would like to go back to air emissions. I'm encouraged to see that there is an awareness of the technology, and some move to work with the other ministries with regard to this. I'm curious, but will defer to the Liberal critic for Agriculture with regard to alternative fuels and initiatives that government can come forward with to encourage those kinds of alternatives.
R. Chisholm: One subject I want to address is ethanol, which would help out your ministry and agriculture. They need it because the grain growers are in a bankrupt situation. There is the technology to produce ethanol from grains, corn and other low-grade agricultural products.
I'm wondering if you have any thoughts of a joint venture with the Ministry of Agriculture to develop ethanol plants. There are 60 of them operating in the United States, one here in western Canada and two being developed in Ontario. It is a viable technology that is well worth the effort. If you take a look at ethanol, it reduces emissions. If you take 10 percent, it reduces emissions by 5.9 percent on carbon dioxide, 25 percent on carbon monoxide, 8.5 percent on volatile organic compounds, 5.7 percent on nitrous oxide and 5.3 percent on urban ozone.
[4:15]
If 10 percent ethanol is used, no modification need be done to any upcoming engines or those that are presently in use. It is approved by all the major automobile companies in the world. It seems to be a solution for the pollution that we have -- for instance, in the Fraser Valley. Along with the transportation problems in the valley, all the emissions produced in Vancouver are pushed inland down through the geographic valley. They sit just below the mountain tops until we get a violent storm.
If we could reduce the emissions by these percentages, it would lessen the pollution in the valley and the province and get rid of it. It would enhance the agriculture industry of this province. We could kill two birds with one stone.
Hon. J. Cashore: Hon. Chair, this is an excellent point. We've had some discussions of this within government. I think we need to recognize that there is some success in British Columbia. I think it's quite appropriate for me to mention this as I'm on this side of the House. It's my understanding that 5 percent of the fuel that Mohawk is selling is ethanol. Also, if my memory serves me correctly, at the time that the AirCare program was getting some very interesting publicity -- when it was first starting up and having some start-up problems -- a lot of people, given the word getting out on the street that if they had some of these alternative fuels they would have a better chance of getting through, gave the Mohawk business a real boost, and that was quite interesting. The point is well taken. I think government needs to be giving leadership in this field. That is understood and that is agreed. We also need leadership from the industry. We need to find every opportunity to encourage the larger producers to take a leaf from Mohawk's book and start providing this as an alternative. I am sure the hon. member is aware that in addition to the stats that he has cited with regard to the improvement in air quality issues, if that is combined with the new generation of automobiles -- catalytic converters and the types of methods in the newer automobiles -- it becomes a much more significant percentage of improvement. I notice that one of our staff is writing some more notes for me here, so I'll probably have some more things to say about that.
R. Chisholm: This is a win-win situation for B.C. and for Canada. With ethanol -- and with 10 percent we don't have to adjust the engines -- it would reduce the emissions by upwards of 40 percent.
This is a win-win situation because we utilize the grains we can't get rid of -- and it looks like we won't be able to get rid of them, because the EEC and the Americans are fighting over grain, so we can utilize our own. That makes the farmers viable, we reduce the emissions by approximately 40 percent, and we do not have to give tax incentives or anything else for anybody to change their automobile -- to put natural gas in, or whatever the case may be. The only incentives that we would have to offer, possibly, would be to industry to come in and build the plant. This can be done through many means, as we know -- through tax or through cheaper power, or whatever the case may be.
Not only do we have this in the win-win situation, but this process leaves absolutely nothing. After the ethanol is extracted, there is a flour with which we can produce biscuits, cookies, that type of thing -- or food for the Third World. It can be turned into fertilizer or cattle feed, so there is absolutely nothing wasted in this system.
We do have people in this country who are already in this business -- not only Mohawk but UCO and Commercial Alcohols Inc. in Ontario -- and like I was trying to state earlier, there are 60 companies in the States using this now. There have been trillions and trillions of miles driven on ethanol-based fuels.
Not only do we put ethanol in, we take MMT out. As we know, MMT is very suspect as to what it does to small children. If we can get rid of this dangerous commodity and put in something that is user-friendly and environmentally friendly, it's a win-win situation for this province, and especially for the Fraser Valley.
Hon. J. Cashore: I agree with all of that, and I commend the hon. member for the excellent research that he has done.
The Chair: We will recess to attend the division, and then reconvene under the direction of the House.
The Committee recesssed at 4:21 p.m.
The Committee resumed at 4:35 p.m.
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Hon. J. Cashore: We have been discussing alternative fuels in general and ethanol specifically. The hon. member for Chilliwack is making excellent points here. I want him to know that we are part of an alternative fuels committee -- if that's the right term -- with Energy, Mines and Petroleum Resources. We are working together on drafting a regulation that would require somewhere in the range of 9 to 10 percent ethanol to be sold within the province. This is a way we are seeking to bring that part of the industry that has not done so on its own volition into making ethanol available.
The point the hon. member for Chilliwack makes about an ethanol plant in B.C. is excellent. This would also help with our wood waste problem. I do have to say, as I said yesterday, that there are other industrial uses of wood waste where all of a sudden we could find ourselves in a situation where there's a shortage of supply. That sounds a bit strange, given the problems we have with wood waste right now. That could happen. At the present, for a variety of reasons, I think it would be very useful to have a plant in British Columbia.
I'd also like to suggest to the hon. member, given his knowledge of this issue, that I would really welcome the opportunity to arrange for him and members of his staff and colleagues to sit down with staff within the ministry to talk about this issue. I think the sharing of ideas could be very useful.
J. Tyabji: I do have a quick question that has nothing to do with this, and then I'll defer again to the Agriculture critic. It has to do with something I've observed with regard to the ministry staff. Why are the men always at the front and the women at the back? It just drives me crazy -- just for the record. You need a female Environment minister.
Hon. J. Cashore: That question is one I could go on about for a long time. I'd like to point out, though, consistent with that, that Ms. Shelton here is the member of our staff who is in the forefront of the Ministry of Environment program dealing with gender issues. I know she would be delighted to hear you raise that question.
J. Tyabji: On behalf of everyone here, I note that there are other desks available, and I'd really like to invite all of them to be sitting around the table with us. I would feel more comfortable that way.
Interjection.
Hon. J. Cashore: Hon. Chair, I really think this is a strain, but it is partly to do with my ability to hear. It's very convenient for me just to be able to turn and have somebody whisper an answer in my ear so that I can sound erudite.
R. Chisholm: Back to the subject of ethanol. The hon. minister mentioned the Ministry of Energy and Mines and ethanol. I don't quite understand that, considering ethanol is distilled from grain. The original question was: is a plan being put into place now to have your ministry and the Ministry of Agriculture do a joint venture on ethanol? Or do you see this happening in the future?
Hon. J. Cashore: The reason is that we have an alternative fuels committee, which is driven by the Ministry of Energy, Mines and Petroleum Resources. Therefore that ministry has a very clear function with regard to this issue. With regard to the point that is being made, however -- it's a good point -- we are consulting among ourselves with regard to the initiatives that I've already pointed out for the record in response to earlier questions.
R. Chisholm: If they are negotiating, are they taking ethanol seriously? As for the second question I brought up before on mass transit in the valley, it seems that the problem is the automobile. We have to get the automobile off the road -- or as many of them as we possibly can. One of the alternatives to the automobile is, of course, mass transit of some sort. Last year, you may recall, I talked about utilizing the rail lines that already exist and possibly incorporating rolling stock, which would not be that costly, to start commuting people from the Chilliwack area through Abbotsford and Langley and all the way into Vancouver, and getting people off the Trans-Canada. The Trans-Canada, for one thing, is overcrowded as it is, and if we enlarge it, all we are doing is inviting more automobiles -- and we want to get rid of some of them as it is. Are you looking into car-pooling or pushing that style of travel?
Hon. J. Cashore: Hon. Chair, I'll confine my answer to the environment part of this question, which more appropriately goes to the Minister of Transportation and Highways, who is responsible for this issue, and the Minister of Finance, who is responsible for transit.
First of all, I want the hon. member to know that everything I've said in response to his question about ethanol has been to indicate that we are working on this issue. We're seeking to promote it, and we're cooperating among ourselves. I can't quite understand what sounded to me like a perception that that wasn't the case. Every effort has been made in my answers in the last half-hour to appreciate the point that the hon. member is making, to assure him that we are following up on these issues and to invite the hon. member to meet with our staff, so that we may have the benefit of his expertise on this issue. I have given some very definite answers that indicate initiatives which are underway -- of both a regulatory nature and a persuasive nature with regard to the industry. I agreed with his point that while we have Mohawk setting such a good example, we have to expand that to the larger companies that should be more forthcoming on this issue. I agreed with him that we need to have a plant, and I also assured him that the alternative fuels committee, which involves Energy, Mines and Petroleum Resources, also involves the Ministry of Agriculture.
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With regard to the mass transit issue, I want to say two things: one that relates to the question that was asked and something else that's a bit tangential. As I said before the member was in the House this afternoon, we have to address these issues as government, as industry and in terms of the public will, too -- political will, public will and also the will within industry itself. The hon. member may have noted that the committee headed by Mayor Len Traboulay recently reported to the hon. Minister of Finance with regard to the work of his committee in the Port Coquitlam-Coquitlam-Port Moody area, and he had a set of recommendations that were very high profile. One recommendation was that rolling stock make use of the two existing railway lines as a means of addressing commuter needs in that area.
[4:45]
I also want to point out that we've seen rampant growth which did not have the kind of planning component that should have been in place, and we've seen massive housing go into the northeast sector of the Fraser Valley without the infrastructure planning that would enable the right transit to be planned prior to the housing developments going in. There's a real need to change the way we do planning.
The hon. member makes a good point, and I know that the hon. member, being in Chilliwack, is also referring to the opportunity for rolling stock going out that far. I cannot answer this for the Minister of Finance, but I think there are questions of economies of scale at the present time that have to do with the number of potential commuters from that area. But it should be watched very closely. If we have the kind of population that you have in Europe, where you have many millions being moved, it does afford a much more cost-effective mass transportation system.
The other point I want to make is that I have a little bit of a dilemma I want to share with you. I agree we need to get people out of cars and into mass transit, but at the same time, when I was in California, I had the opportunity to drive a zero-emission vehicle -- an electric car. We know that if we go that route, that creates the opportunity for the independence and individualism the automobile affords -- but even a zero-emission vehicle has to get energy from somewhere. I recognize that point. But I do predict that when the price of that prototype comes down to around $20,000, it's going to become a hot seller here in the lower mainland and we will get the benefit of the economies of scale in southern California. The law there is requiring that 2 percent of automobiles sold in the year 1998, I believe, be ZEVs -- zero-emission vehicles. By the year 2003, it has to be 10 percent. That means it is creating an incredible opportunity for the automakers and, while that environmental regulation has an impact in southern California, it will make that vehicle available to us here in British Columbia.
What was a real surprise was that when I got in to drive that car -- and I thought I was getting into a golf cart, though it didn't look like a golf cart; it looked like a little sports car -- and turned the key, nothing happened. There was no vibration or anything. I have never driven a golf cart, so this was kind of surprising to me. But then when I stepped on the pedal, this thing just took off and I went out onto the L.A. freeway and was able to keep up with all the traffic there. The only problem was that it had such a large battery pack, there wasn't room for much else. But I am told that within two or three years those batteries, which have a 50-mile capacity, will be much smaller and have a 100-mile capacity.
The other thing is that the South Coast Air Quality Management District, to encourage different types of flex-fuel and alternative-fuel vehicles -- recognizing that the solution is not to go with any one particular approach but to have a variety of approaches -- has put in a solar panel right next to its office complex. This, therefore, is solar energy -- and if you have an electric car, you get to park your car closest to the door of the plant or office. You can plug it in and top it up while you are at work so you can make the commute back. They're doing some very interesting and innovative things we can learn from.
Further on that visit, I think there was a good exchange of some of the things we have to share -- not the least of which was the AirCare program, which they are very interested in.
Interjections.
D. Schreck: I want to take this opportunity in the context of the minister's remarks to point out that Ballard Power, which is located in my riding of North Vancouver-Lonsdale, is working on precisely the technology for the zero-emission vehicles. It soon will not be necessary to visit California to see this technology; B.C. is a major developer and soon-to-be exporter of this technology -- from the riding of North Vancouver-Lonsdale.
Hon. J. Cashore: I'd like to suggest to my hon. colleague and good friend that when he has time he should read Hansard for the flowery words that members of the opposition and government were saying about this hon. member's riding and the innovative work there. We were actually suggesting that he make a bunch of sandwiches some day and invite us all over to go for a ride on the bus together, to demonstrate to his constituents how well we all get along.
R. Chisholm: This is all very nice, hon. minister, but that's going to take ten, 15 or 20 years. In 1988, in Chilliwack, you could see the trees on the mountains two miles away; in 1993, you can't and that's on view every day. The problem is we have to have some sort of temporary stopgap procedure to try to slow this effort down, because it is worsening at the east end of that valley in the Abbotsford, Chilliwack and Matsqui areas. It is not getting better, it's getting worse.
We have to do something within the next couple of years, because goodness knows what we're doing to our environment out there. We already know that the crops in the valley are not producing at the same percentages they did 20 years ago. Their output is down by 10 or 15 percent. That's due to pollution. We know that it's due to the air, the pesticides, the herbicides and all the rest that we're utilizing. It's deteriorated in five years to that
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degree, so by 1998, when your first experimental electric car comes on stream, it's going to be too late for some of these areas. All I'm saying is that we have to look at alternatives until the final solution comes along, because it may be years in the making.
Hon. J. Cashore: I couldn't agree more, except I can't agree with some of the terminology that the hon. member has used. I don't see it as a temporary stopgap procedure -- I just don't see that being in the works. I think we have to do careful, incremental planning, using an array of resources. But it's going to have to be something that functions in concert, involving government, public and industry. I think we have made an achievement in levelling off the levels of ground-level ozone that, as I've indicated, can clearly be demonstrated. We have to do better than that -- there's no question.
I think the hon. member might want to consider standing up in public and saying that he feels more financial resources should be made available to this ministry to help us do some work in this area. I would certainly welcome that type of advocacy on behalf of the environment. I would be delighted if he would ask me a question in the House where he'd make it very clear that he favours greater financial resources being made available to assist the work of this ministry in addressing this urgent and pressing problem. I would be absolutely delighted if he would do that.
R. Chisholm: You talk about the little study that they had out in Port Coquitlam. I was talking about this a year and half ago in the House, if you recall, in private members' statements. I have discussed it around the province; I have discussed it in the chamber; and I have discussed it with various ministries in this government. On top of that, if you've read your bills, Bill M219 -- one I introduced -- happens to be an act to introduce a minimum ethanol component for gasoline.
I believe very strongly in what I'm saying and doing right here now. I'm not saying spend a lot of money. I am saying we can give the incentives, get industry to spend the money, and we can utilize what we have here in the way of resources for benefits in the way of jobs and the economy, and get rid of the pollution that is affecting this province -- especially in the Fraser Valley. So I have put my money where my mouth is, so to speak, hon. minister.
Hon. J. Cashore: Hon. Chair, again I agree with this hon. member, but with all due respect, what he has just described and what he is suggesting be done, is not a temporary stopgap measure at all. What he is suggesting be done is exactly what I have been indicating: careful, incremental, well-thought-out planning, which is exactly what's happening. Hon. member, I commend you for your private member's bill, and for the very fine work that you are doing in carrying this issue forward. I'm glad that you made your statements a year ago; I'm glad you're making statements again this year; and I hope that you will also consider other ways that you can help to encourage us in government to move forward on this issue. It would be very helpful to have your support in all aspects. Of course it isn't a question of just throwing money at the problem. But I'm sure the hon. member realizes that if we had more conservation officers, for instance, to deal with monitoring and enforcement issues, that would be one way in which there could be quite a direct impact on the air quality issues that he's so concerned about. I look forward to this member rising in the House and suggesting that more resources be made available, so we can have more staff for monitoring and enforcement to help improve the air quality in the Chilliwack area.
C. Serwa: I have one quick question with respect to ethanol. In the last three-quarters of an hour, probably, we've heard a great deal of discussion on ethanol, and we'll have another question. But in Winfield, in the constituency of the member for Okanagan East, is a plant sitting in a mothball situation right now. The Hiram Walker distillery is not being utilized. It could work at full capacity, with very little modification, for the production of ethanol, and could probably employ about 25 full-time staff in that production facility. About four years ago they ran extensive scenarios to look at the economic viability of simply producing ethanol as a fuel additive, and explored markets with Mohawk and other merchants of gasoline.
Bearing in mind the minister's strong feeling -- as he's identified over this last three-quarters of an hour -- would the minister consider it worthwhile for the principals of Hiram Walker to resubmit proposals? The reality was, what was difficult was the cost of transportation of the grain from perhaps the Peace River area. But I note that other processes have evolved that accelerate the production of ethanol. Perhaps I could encourage the principals to contact the Minister of Environment and resubmit proposals with the margins they would require for the effectively viable operation of that whole plant.
Hon. J. Cashore: The hon. member is right: conditions are constantly changing. I am not familiar with these proposals. I would be interested in having a look at them. I can't say off the top of my head how it would play out. We have to put that in balance with the suggestion of the member for Chilliwack. I think he would like to see a plant more in the vicinity of potential for production of raw product in the Fraser Valley. But obviously these are....
C. Serwa: Peace River.
Hon. J. Cashore: Peace River? I'm sorry, I misunderstood what the member said. The hon. member was suggesting a plant in the Peace River country. Be that as it may, I think we need to look seriously at those kinds of proposals. But please remember that we also have proposals dealing with other processes coming to us. To the extent that wood waste is seen as part of the process in some instances, that would require careful economic analysis. Again, some of these questions are better put to the Minister of Economic Development.
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D. Mitchell: While we're on this topic of ethanol, I'd like to just ask the minister if his ministry has been involved with, or is aware of, any of the proposals now being generated to produce ethanol from wood waste in British Columbia. He mentioned wood waste just now, and it's an interesting topic. I know there are some proposals. One particular process apparently has been sponsored by the federal government in this area. It's the ACOS -- acid catalyzed organosolv saccharification -- process. It would seem to be a tremendous fit for a province like ours, where our forest industry has a perennial problem eliminating wood waste. If we could actually generate ethanol, and if ethanol could be used in ways -- described by the member for Chilliwack -- that could be a positive engine of economic development in our province, and if we could deal with a waste problem in the forest industry as well, there would seem to be some tremendous synergy with those ideas. I wonder if the minister could tell us whether or not his ministry is involved with any of the proponents of this kind of process and whether or not there are bright future prospects for generating and producing ethanol from wood waste in our province.
[5:00]
Hon. J. Cashore: I previously made a number of comments that answered different components of the question. So, without wanting to repeat all that, I just want to say that the answer is yes, we are looking at this. We realize that that is a very significant and important suggestion, but it has to be put alongside other suggestions that are coming forward so there can be a well-coordinated approach. There are some suggestions that could impact on the availability of wood supply, believe it or not. As I said the other day, an industry has emerged in Oregon that is making new products out of wood waste, and the problem they are having now with the success of that industry is security of supply. There are some people -- environmental groups, for instance -- who would not want to see wood waste going into a process that might ultimately end up in burning, if they could see it go into some sort of primary construction material or something like that. So we have to be cognizant of those complexities. I personally have a concern that industry from Oregon, because it has a regulatory regime down there to deal with it, is getting in on the ground floor with these manufacturing processes using wood waste. It is now being brought into British Columbia, in some instances, where we should be developing local small business opportunities. I met with a firm from Campbell River, for instance, that was up against the competition from a much larger firm being contracted by a neighbouring municipality. I'm just saying that that is one of the complexities.
We've also looked at wood waste in relation to cogeneration and the various alternative fuels that we need to be considering. These are all good and responsible ideas. We also had a full-day seminar on various technologies for eliminating wood waste, including the one that the hon. member has mentioned.
J. Tyabji: I'd like to continue in this vein -- on emissions -- and move to the particulate contaminant section of the state-of-the-environment report. Last year we spent some time talking about the clean air strategy and the minister's direction on that. I know we had legislation last year, and we've got a different direction in the legislation this year, and that debate will be carried on elsewhere. With regard to particulate contaminants, as the minister made reference to earlier and as we debated last year, I note that one component of the cost of slash burning and the resulting particulate suspension in the air -- particularly in areas where there is a local weather inversion, such as the Fraser Valley, the Okanagan and some parts of the Kootenays -- is that there is generally a corresponding increase in emergency room admissions and in demands on respirologists. In fact, I'm sure the minister has been contacted by Dr. Bill Arkinstall of Kelowna, who is one of the province's leading anti-slash burn campaigners. As the minister is aware, last year I advocated alternative forestry methods that would involve the elimination of slash burning and a move toward a different, more comprehensive way of dealing with forest regeneration and wood waste.
I want to look at this section and canvass the minister's input, because very clearly in this minister's report it says:
"...materials can be deposited in the human respiratory system and may damage human health. Children, the elderly, smokers and those suffering from lung disorders may be especially susceptible to this type of air pollution. Total suspended particulates are primarily a local problem, and eventually all of these materials are deposited onto surfaces either locally or downwind."
We know that this has been a serious problem around the province. I don't think it's getting any less serious, and I don't know that there has been a serious effort made in concert with the Ministry of Forests to deal with this in terms of the clean air strategy. I'd like to talk to the minister to see if any progress has been made in the last year and in what direction we'll be going, particularly as we see very specific talk about smoke sources and the effect on human health in the smoke management section of the state-of-the-environment report.
Hon. J. Cashore: In relation to the comments the hon. member just made, we have received a health study done by UBC professor Dr. Sverre Vedal. His expertise is on the health side of air emissions, and this study was cofunded by the Ministry of Health and ourselves. I haven't seen it, but I am advised that it's a very important study and very significant in terms of the issue the hon. member is raising. I will also point out that with regard to smoke control and slash burning, we had Bill 29 in the Legislature last year. We have just completed our smoke regulation, and that is public. That draft regulation will address the issue of smoke from slash burning and woodstoves with a code of practice that will emerge from the process enabled as a result of the regulation. In the meantime it clarifies the requirements for permitting burns in forest areas and
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non-forest areas. It also addresses the issue of beehive burners.
J. Tyabji: I have a direct question to the minister. I know that the Ministry of Forests is planning to bring out a new forestry practices code. Is there work being done between the two ministries so that the smoke regulations from the Ministry of Environment dovetail with the new forestry code?
Hon. J. Cashore: The answer is yes, there is coordination between the two ministries. That coordination was part of what emerged in the draft regulation, part of what emerged in Bill 29 and part of what will emerge in any other areas where this is being dealt with.
With regard to the specific question about the role of smoke in the draft forestry practices code, at this point I have to say that that could be dealt with under environmental legislation and regulation. That is subject to further consultation, again involving both ministries.
J. Tyabji: I'm referring more to alternative practices that may be used. There are some very successful examples in the United States and in some European jurisdictions where they've moved toward what they are calling "ecoforestry." I think they would assist in the development of a new forestry code and of our clean air strategy, rather than it just being a case of regulation, for example, of air emissions.
I note that on page 14, at the top of the third column, it states: "There are no quantitative estimates of the amount of smoke generated in B.C." I'd like to have some clarification on that, and I'll wait for the minister's response.
Hon. J. Cashore: Through the draft code of practice that would be pursuant to the burning regulations, we would seek to address these issues. Of course, we would be interested in any information the hon. member has about models from around the world. One of the goals of the draft regulations, though, will be to reduce waste through high utilization of what is now considered waste but should be considered valuable material. Another goal will be a new understanding of the circumstances under which slash burning should take place -- that it should always be in conditions of what is referred to in the trade as high venting, where the smoke would go up to the upper atmosphere.
J. Tyabji: That has overtones of the debate we had last year, when that same statement was made. I know that's always the intention: to only conduct major burns when there is high venting. But I know from experience, living in the Okanagan, that quite often that is not the case; and even when it is, it gets into the higher atmosphere and comes down somewhere else. Sometimes we're on the receiving end, and sometimes it comes down elsewhere, but it is still a problem.
I will commit to bring copies of some of the ecoforestry models that I have in my office, hopefully for tomorrow's debate.
Historically, we've had a problem in Canada from being so close to the border and to some of the industrial centres of the United States. At the bottom of page 14 and the beginning of page 15, we see: "...B.C. may also have to address the issue of transboundary movement of atmospheric contaminants drifting south from B.C. to the U.S.A., where strict air quality and visibility standards are in force.... As well, B.C. will need to consider the issue of contaminants drifting north from the United States." I wonder if the minister could expand on that. I think it's interesting that the issue of air quality, in reference to stricter controls, is when it affects the United States. They might get a little bit upset about the air quality that, if it doesn't drift south, we end up putting up with, so we might have to deal with it. What would be the process? What does that paragraph refer to?
Hon. J. Cashore: Hon. Chair, there is a Canada-U.S. clean air agreement that seeks to address that in a way that is fair. If there are specific instances where that is not being dealt with fairly, we should know that. There's also the environmental agreement that B.C. has with the state of Washington. I'd also mention the context of the Georgia basin initiative, which I think is widely appreciated as a means of enabling the participation of the public, of scientists, and of other parties -- say, from municipalities -- that have a great interest in these cross-border issues, recognizing that the air is no respecter of the border.
J. Tyabji: Tomorrow when I table the ecoforestry models that I have in my office, I will also commit to table Cascadia Wild, which is a preview publication from Mitch Friedman and, I believe, Herb Hammond, who have put that together -- which should be coming out in book form fairly soon. It also deals with the concept of the ecosystem, regardless of borders; and of course, Cascadia Wild refers to a lot of the area referred to in the Georgia basin initiative.
[5:15]
I would like to know, specifically, since we're on the borderless environment concept, to what extent the Ministry of Environment is participating in the Georgia Basin initiative, and what the main focuses of participation are?
Hon. J. Cashore: There's a budget item in the Ministry of Environment that has to do with the Round Table on the Environment and the Economy. One of the assignments that has been given to the Round Table on the Environment and the Economy is to coordinate the Georgia basin initiative with regard to helping enable the province to carry forward with that initiative. The round table coordinated a conference that took place a few months ago -- I am trying to remember the exact month. It was a very successful event and there was good participation from both sides of the border. Issues of mutual concern were identified and worked on. There was a good sense that this wasn't just a meeting for people to sit down and talk, but that this did have the political will of the Governor of Washington State and the Premier of British Columbia and, therefore, that
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these issues were going to be dealt with on both sides of the border and addressed effectively on a regular basis. On this cross-border process, there are a number of issues being worked on. With regard specifically to the Georgia basin initiative, the Ministry of Environment, Lands and Parks obviously has a major interest in that, along with other ministries of government.
J. Tyabji: I'd like to move further on in the state-of-the-environment report and not get into any of the specifics of some of the emissions. I look forward to the clean air strategy, and we can revisit that.
The next section is water and, while we're on the water section, there is one issue that came up today that I'd like to ask the minister about specifically. It is with regard to the Cowichan Estuary Protection Society and the fact that the report on the Cowichan estuary was near completion -- and the funding has been virtually eliminated. I think there is a lot of concern locally that they won't see a completion of that report. Could the minister give me an update as to what is going on?
Hon. J. Cashore: Some information is being gathered for me, so I will be able to give a bit more information on that later than at the moment. I want to say that the issue of the Cowichan estuary is an important one. We have signed a cooperation agreement with the Cowichan band; Chief Philomena Alphonse and I signed a joint memorandum of understanding with regard to a process that would involve the band and also Environment in the cleaning up of the estuary. Our staff, working out of our Nanaimo office, continues to work with the band on that initiative. I hope I've got this right, but I believe that the hon. member was asking a question about the estuary.
There is also a question that sometimes comes up with regard to the entire Cowichan corridor, and that's another issue that's being addressed. In February, I availed myself of the opportunity to drift down the Cowichan River with Joe Saysell, who's a guide in the area, to see what an opportunity there is there -- and was there several years ago before much of that land became impacted by private interests. It's a truly outstanding river on the doorstep of a highly populated area. That is also related to that.
I'm not sure I have the note we're looking for, but perhaps the member could go onto another question, and then we'll come back to it.
J. Tyabji: The follow-up question to that one is.... The report, as I understand it, is almost ready, and there isn't any funding to complete the report. I think it might be prudent to reallocate some resources internally so that the report can be finished. Perhaps we could start with some of the committees we were discussing earlier and maybe put some of the staff on those committees over to this report.
With regard to water, as the Environment critic for the third party brought up earlier, we have a situation in British Columbia that is unique, in that we have basically the world's last supply of clean fresh water. The two things that are going to concern us in the next ten years are water quantity and water quality. To a large extent, we're going to have a hard time assessing future water quantity because of a few things -- one being that we're not sure what the population growth, the demand, the technology, the industrial use and these kinds of things will be in the future. Because groundwater use is unregulated, we don't currently have an inventory of water quantity as it relates to groundwater. We are not yet sure what the federal government is going to commit us to with regard to water exports. To a large extent, of course, that's where some of the legal jurisdiction will come in as far as water being treated as a commodity or a good.
So there are a lot of concerns with regard to water quantity, and one is brought up on page 19. It names a number of places where there has been a high demand in the summer, with seasonal changes, and areas of the province where they've experienced shortages of water. A lot of these areas are some of the fastest-growing. The Thompson-Okanagan, of course, is the second-fastest next to the Greater Vancouver Regional District; then we have the Capital Regional District. These are all areas that are growing rapidly, and they've already experienced some problems with water quantity. One of the problems, I think, is that there is so much water available that there hasn't been adequate regulation of some of the usages.
I think that the concern brought up here, toward the bottom of page 19, where it says, "Climate models suggest that global warming may further exacerbate this situation by significantly reducing summer precipitation in southern B.C., while increasing summer evapo-transpiration," is an important point to make, because right now there isn't an adequate debate on limits to growth as identified by the natural limits that we're faced with. When I talk about limits to growth, I'm talking about strategic planning; locally based economies; recognition of limits, in that nature has to provide for our needs; and obviously, tailoring our economy so that it is healthy and so we provide for our own economy before we start providing for others. So that's where I don't think there's enough strategic planning in terms of water quantity. This is a large area that I think has to be discussed. I know there's a discussion paper coming out on water exports, but there doesn't seem to be a strategy -- and I know we're talking about water usages -- for inventory of water. I know there may be some legislation coming out in 1994 with regard to water regulation, but from this ministry's report on water, I think we can see some potential problems in the future.
Hon. J. Cashore: On the contrary, this government has a very clear strategy with regard to water. Clearly the hon. member either hasn't been listening or has been away when much of the information has come out. I outlined many of the answers to the questions that were just asked earlier in the afternoon. I have said on many occasions that we need a complete revamp of our water legislation. It is not correct to say that we're simply dealing with the water export issue. We are dealing with the revamp of the entire water regime in the province, recognizing that the existing legislation is
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hopelessly out of date. In order to do that, we need to have a multi-stakeholder process that goes out to the community. That paper soon to come out is part of a process that has been going on, and it was actually started before we became government. So a lot of work has been going into this. The Round Table on the Environment and the Economy has produced a definitive paper on water. It's not to disagree and say that the issue isn't important, but it is to disagree and say that we have been addressing this very responsibly.
I think we, as MLAs, have a responsibility to be aware of what is happening and to make constructive input into that, based on a knowledge of what is happening. What is happening in this regard has been the subject of a tremendous amount of energy from people working within this ministry. So I make no apologies whatsoever with regard to the work that's been going into addressing this backlog on the water issue. And as far as I'm concerned, it's one of the most important issues that I will ever work on in my term as Minister of Environment, Lands and Parks.
J. Tyabji: I think the minister has misunderstood what I'm saying. I've read most of the reports that have come out. I've read the round table's report with regard to water. I've read the discussion papers from the Ministry of Environment. What I'm saying is that I have yet to see any discussion of a strategic plan that would be a province-wide recognition of what the current limits to growth are. That debate hasn't even happened yet. It's not enough to say: "Yes, we need to regulate; yes, we need to legislate; yes, we need to decide what our philosophy is with regard to water exports."
Every poll, where the public have been canvassed on this issue, shows that people feel very strongly about water sovereignty and ownership of their resources. It's practically a religious issue in British Columbia, but that's not the point. The point is I still don't see a long-term strategic plan, that would, for example, recognize arid areas of the province, the need for potential water metering in those areas and what the limits to growth are. For example, we know that in the Okanagan, on the initiative of the three regional districts, they are going to have some regional coordination of things like airshed and water management. However, I still don't see any initiative from the Ministry of Environment, like we talked about last year, on some of the ways in which growth should be directed. That's what I'm talking about with regard to water.
I do recognize that the minister has targeted water as an important area, and I do know that the legislation that will come out on it is going to be comprehensive; whereas the legislation that currently exists is almost irrelevant to the process. At this point we're just dealing with band-aid legislation in terms of what we need. Currently we're not even regulating our groundwater. There's no evidence of major mining of our underground aquifers, but we're not even 100 percent sure of that. So for the minister to suggest I'm not aware of the process.... I'm aware of the process. What I believe the process is lacking is a long-term strategy, recognizing the province's incomplete inventory of our water resources, the potential change in that inventory from numerous factors and therefore our limits to growth. I've never heard that debate even suggested.
Hon. J. Cashore: It's really interesting to hear this comment on limits to growth, in view of the discussion that took place in this chamber this morning. Members of the Liberal Party were coming forward with arguments that were contrary to the concept of the Club of Rome, the architect of the precautionary principle. It's very interesting to hear this kind of conflict within the Liberal Party with regard to this issue. Again, the hon. member has made a comment about concerns about water exports, yet her party appears to be playing both sides of the fence with regard to NAFTA. It's very interesting to hear these comments; I find them fascinating.
I say again, I make no apology whatsoever with regard to the proactive work being done with regard to water in the brief 18 months since we have become government. And there is more to come. So put on your seatbelt, hon. member, you're going to be seeing lots more activity on water coming from this government.
While I might move the motion, I know that the hon. member for Okanagan West has a question. If he'll agree to ask it briefly, I'll agree to a one-word answer.
The Chair: I'm prepared for this.
C. Serwa: Thank you very much. I appreciate the offer. It's really not a question; I guess it's just a statement with respect to the way the debate is going at present. I'm really interested in participating in the debate of the estimates of the Ministry of Environment.
We in this room all know what is causing pollution. It's growth in human population, and it's the needs, wants and expectations of that growing human population. To try to resolve the dilemma, the complexities or the magnitude of that is not really possible. Nor is it the responsibility of the Ministry of Environment. So when we're taking a look at the resources, we have to understand those fundamental things.
[5:30]
It seems to me that if we're going to discuss the estimates of the Ministry of Environment, we can't do it by going line by line through the state-of-the-environment report. There are some questions as to how we in this jurisdiction stack up to other jurisdictions in Canada.
I had a lot of questions with respect to the estimates, but for me the discussion is becoming so philosophical and unsolvable that we are not doing justice in assessing the activities of the Ministry of Environment.
Hon. J. Cashore: I appreciate that comment and agree with it. I would like to move that the committee now rise, report progress and ask leave to sit again.
Motion approved.
The Committee rose at 5:30 p.m.
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