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)
TUESDAY, JUNE 1, 1993
Afternoon Sitting
Volume 10, Number 16
[ Page 6737 ]
The House met at 2:05 p.m.
C. Serwa: Joining us today is a very special individual who has travelled all the way from the Kootenays -- a former Social Credit member representing the Kootenay area. He is here as a former Minister of Labour, altogether too willing to give advice to the present Minister of Labour. Would the House please make Terry Segarty welcome.
Hon. D. Miller presented a message from His Honour the Lieutenant-Governor: a bill intituled Forest Amendment Act, 1993.
Hon. D. Miller: It is my pleasure to introduce Bill 30 to this House. This bill amends the Forest Act to improve the management of provincial forests in a number of areas. The act introduces amendments to allow the Minister of Forests more frequent opportunities to update the terms and conditions of tree farm licence agreements.
The act introduces changes to the woodlot licence program which allow flexibility to change the boundary or size of a woodlot licence, increase fairness in the awarding of new woodlot licences and allow for greater equality in allowable timber harvest volumes between coastal and interior woodlot licences.
The act introduces amendments to help the Forest Service protect the financial interests of the Crown by strengthening controls over the scaling of timber and improving the ability of the Forest Service to collect moneys owing to the Crown.
Finally, the act introduces housekeeping amendments to clarify the intent of some sections of the Forest Act. Bill 30 helps fulfil this government's commitment to better management of our province's forest resources.
Bill 30 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.
LABOUR RELATIONS CODE ADVISORY COMMITTEE ACT
G. Farrell-Collins presented a bill intituled Labour Relations Code Advisory Committee Act.
G. Farrell-Collins: This bill will require the minister to immediately establish an advisory committee under section 3 of the Labour Relations Code. This committee will aid the minister in reviewing the Labour Relations Code by making recommendations to the Legislature and the minister with regard to the impact, effectiveness and problems of the new labour code, resulting in a more practical and effective labour relations climate in the province to better serve all British Columbians, including students.
Bill M221 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.
WELFARE FRAUD
A. Cowie: A question to the Minister of Social Services. A private investigator has uncovered a scam for getting fraudulent birth certificates. These enable persons to receive numerous welfare cheques. The minister is obviously aware of this. What is the minister doing about it?
Hon. J. Smallwood: For the member's information, we have been working with the Attorney General, who in turn is working with CLEU and also Interpol, because the whole issue of counterfeit identification is one that is hitting all systems, ours included.
A. Cowie: Again to the minister. This fraud is costing millions and has for the last number of months. Much of this fraud can be stopped by photo ID similar to the common driver's licence. This has been done in Quebec. Will the minister provide those people requesting social assistance with proper ID similar to the driver's licence, so the people requiring assistance can get it and the money doesn't go to the fraud artists?
Hon. J. Smallwood: I'm going to say one more time that this is an issue that is of concern to all financial institutions, ours included. The concern that we have has been highlighted by the additional resources that we have put in place: additional fraud investigators and a specialized team to deal with sophisticated fraud. That is what we're talking about, hon. member -- sophisticated fraud. Counterfeit documents, whether they are birth certificates or picture ID, are of concern to the Attorney General, to CLEU and to Interpol. All of those senior agencies are working to tackle this problem.
A. Cowie: Again to the Minister of Social Services. Surely the minister can get real. In Quebec all they have is ID similar to drivers' licences, and it has cut down the fraud by 50 percent. You don't need any more advice than that to save millions. When will the minister get on with it?
Hon. J. Smallwood: We require two pieces of identification in our ministry: a social insurance number and a second piece of identification. In areas where there is significant concern, a financial assistance worker is supported and encouraged in requiring additional pieces of identification to address those concerns. The issue, I reiterate, is one of sophisticated fraud. It is of concern to all systems. We are working with all agencies in trying to tackle this problem.
[ Page 6738 ]
PREMIER'S ROLE IN DEALING WITH LABOUR DISRUPTIONS IN SCHOOLS
W. Hurd: My question is for the Premier. The Premier has still not given the people of the province an explanation in this assembly as to why he exempted himself from cabinet meetings in which the settlement of the Vancouver teachers' strike was addressed. Can the Premier tell us exactly when he exempted himself from cabinet meetings on the Vancouver school strike and why he waited so long to get a ruling from conflict-of-interest commissioner Ted Hughes?
The Speaker: Before I invite the Premier to answer, I would caution all members on both sides of the House about the guideline in 47A, and that the proceedings of cabinet meetings are not acceptable subjects for question period. With that guideline, I will invite the Premier to answer and ask him to keep those limits in mind.
Hon. M. Harcourt: Thank you, hon. Speaker. I dealt with that question yesterday. Secondly, if the member needs further information, I will take his question on notice and supply what further information I can supply, having due regard for the confidentiality oath that I swore when I entered cabinet.
The Speaker: I will invite a supplemental, asking also the hon. member for Surrey-White Rock to keep in mind the guidelines of question period regarding cabinet matters.
W. Hurd: Then perhaps I can ask the Premier a question of principle. Does the Premier really expect the people of the province to have confidence in a Premier who exempts himself from cabinet meetings, for whatever reason, without an adequate explanation of why he should leave the cabinet -- the executive council -- without a functioning Premier? Is this the Premier's definition of leadership?
L. Hanson: My question is to the Premier, too. By dodging his duties in cabinet under the pretext of a possible conflict of interest, the Premier has confirmed what most British Columbians already suspected: that he's only a part-time Premier. Is the fact that he's a part-time Premier the reason he took a 5 percent wage decrease?
[2:15]
The Speaker: I would remind the hon. member that presence in or absence from cabinet is not in itself a matter for question period. Members need to frame their questions carefully.
L. Hanson: Thank you, hon. Speaker. I suspect that most taxpayers in B.C. would prefer that the Premier base his pay on the number of promises he has kept. He probably wouldn't be getting anything.
If the Premier felt that he needed Mr. Hughes's permission to sit in cabinet, why did he wait 19 months? Didn't the Premier anticipate that his government would likely have to deal with the issue of putting teachers back to work in the case of a strike?
The Speaker: The hon. member for Okanagan-Vernon has a third question?
L. Hanson: One final supplemental, hon. Speaker. I'd like to ask the Premier how many other ministers are going to bail out of their responsibilities, as we've seen in this case. Which of the other ministers are unable to do their job? Is the Premier satisfied?
The Speaker: Order, please, hon. member. I am going to disallow that question. I have already reminded hon. members about the limits of question period on this topic.
NON-PROFIT ADOPTION AGENCIES
V. Anderson: My question is to the Minister of Social Services. Last week a national study was reported as supporting non-profit adoption agencies. The minister was reported as saying that she now also supports non-profit adoption agencies in B.C. Will she confirm that statement for us here in the House?
Hon. J. Smallwood: The reporter who wrote that story in the first place asked me twice whether my position had changed. The answer to her, twice, was no. Regrettably, on subsequent occasions the editorial page carried editorials on that same topic. The editorial department has a letter from me clarifying and challenging that misquote, and have made a commitment to run a disclaimer. The information and the quote from the paper that you have are incorrect. We continue to work to develop adoption policies for the province. Any debate around this issue will have to take place when that legislation is tabled in the House.
The Speaker: Supplemental, hon. member.
V. Anderson: The confusion engendered by this has, nevertheless, caused a great deal of uncertainty in the province, even more than we had before. Besides writing to the paper, will the minister make a public statement explaining why and on what basis she goes against the national study? Will she please explain why her wisdom is greater than the national study?
Hon. J. Smallwood: I think it's regrettable that the member chooses to quote a single line out of the national study. The national study that has been concluded and made public -- two years work by those authors -- is extensive, and to a considerable extent supports the work that we currently have underway in this province around adoption policy. I'm very pleased by that fact.
As for the disclaimer, it is my hope that the newspaper publishes that disclaimer, as they have agreed to do.
[ Page 6739 ]
NANAIMO COMMONWEALTH HOLDING SOCIETY
L. Fox: My question this afternoon is for the Attorney General. It has been well over a year since Mr. Henderson was appointed to investigate the Nanaimo Commonwealth Holding Society scandal. Has the Attorney General had any status reports from either Mr. Henderson or his staff, or does he have any idea as to why this investigation is taking so long?
Hon. C. Gabelmann: The answer to the first part of the question is no.
L. Fox: Is the Attorney General confident that Mr. Henderson will have completed his investigation prior to the end of this legislative session? Has he or any of his staff asked Mr. Henderson for an update on the investigation?
Hon. C. Gabelmann: In respect of the first part of the question, I have no idea; in response to the second part, no.
L. Fox: Does the Attorney General have any specific knowledge or reason to suspect that any members of cabinet are implicated in Mr. Henderson's investigation?
The Speaker: Hon. member, that appears to be a very hypothetical question.
Interjection.
The Speaker: Order, please. Ministers can answer for their administrative responsibility. If the Attorney General chooses to do so, I would caution him not to address the hypothetical portion of it.
Hon. C. Gabelmann: If that member or other members want to know how the process works, I would recommend they read the Owen report of about four years ago.
THREE GORGES PROJECT
D. Jarvis: My question is to the Premier. A British Columbia Hydro representative stated yesterday that Hydro has no current involvement in the Three Gorges project. Can the Premier confirm that Hydro is not part of the Canadian consortium that is seeking a contract with that project and that it is no way involved?
Hon. M. Harcourt: The minister responsible, the Minister of Labour, is not here today. But I can say that B.C. Hydro is part of a consortium of other utilities in Canada and SNC-Lavalin that is looking at hydro needs in China. One of the projects that was being reviewed in terms of feasibility was the Three Gorges project. That was terminated in 1989 as part of Canadian government policy because of Tiananmen Square. I can say that no decision, as I understand it, has been arrived at on hydro projects in China. But if the member is interested, there are some other hydro activities in China in which B.C. Hydro is involved with consortia.
The Speaker: Supplemental, hon. member.
D. Jarvis: The Premier is on record in this House as saying that the Chinese government has addressed all the concerns involving it with regard to this project. The Environment minister denied any knowledge of the issue when I asked him about the situation several weeks ago. He was completely unaware of it. To the Environment minister, are you now aware of the issue, and are you satisfied that all ecological concerns are being addressed?
Hon. J. Cashore: It's rather interesting that after the fall session and into the spring session, the third question we get in question period on the environment is not about the environment in British Columbia but about the environment in China.
Interjections.
The Speaker: Order, please. I would call the House to order so that the minister can address the question. Please proceed, hon. minister.
Hon. J. Cashore: Hon. Speaker, if I am cautious in answering this question, that is my intent. I think we have to be very cautious about being paternalistic with regard to our decision about what should happen in another country. There are significant environmental concerns about this project. There are also significant environmental concerns about the alternatives, given the nature of the coal in China, and I think we have to be very cognizant of that. I don't think it helps us internationally to sit here, as the Liberal opposition has done, and pronounce what is morally right with regard to another country without having had the appropriateness of being fully cognizant of all the issues.
B.C. GAS AND B.C. HEALTH SERVICES LTD.
Hon. A. Edwards: In response to a question asked on May 27 by the member for Richmond East, I would like to clarify for other members of the House that B.C. Health Services Ltd. is a hospital purchasing group and a wholly owned subsidiary of the B.C. Health Association. Commonly called BCHSL, this company filed a complaint regarding the basic charge in B.C. Gas's proposed interruptible and transportation rate schedules. Those schedules are fairly complex. They are being put forward by B.C. Gas in the rate design hearing before the Utilities Commission on July 5, 1993. BCHSL is an intervener at the hearing. Their complaint will be heard and dealt with by the Utilities Commission. Of course, every other interested party, including any citizen or MLA, is free as well to intervene at the hearing and represent their interests.
I would be pleased to give further information to the member about the proposals.
[ Page 6740 ]
A. Cowie: Hon. Speaker, I request permission to table the UTV expos� of welfare fraud.
Leave granted.
Hon. C. Gabelmann: Hon. Speaker, I call both sections of Committee of Supply. It is my understanding that Committee B will be doing the estimates of the Ministry of Environment, Lands and Parks as soon as it has finished Economic Development.
[2:30]
The House in Committee of Supply B; R. Kasper in the chair.
ESTIMATES: MINISTRY OF ECONOMIC DEVELOPMENT, SMALL BUSINESS AND TRADE
(continued)
On vote 23: minister's office, $347,800 (continued).
L. Fox: I want to get back on the topic that I started just prior to lunch. I spoke to the minister about job creation impacts being different in different sections of the province, and I related to him some stats from last year. I wonder if he has any specifics on what he perceives the regional impacts will be for the upcoming year. From his perspective, will we be continuing to see growth that sees the bulk of the new jobs created in the lower mainland region? Are there significant impacts similar to that of last year in the other regions of the province being estimated by his ministry?
Hon. D. Zirnhelt: I think the results of the improved prices in lumber will help in some of the interior towns. I think that industries that are still under stress -- like minerals -- will probably not see a great increase; it would be nice to change that.
We will expect ongoing growth in the urban areas. I don't think there's any question that urban areas like Vancouver, the lower and upper Island areas and places like the North Okanagan will continue to grow. I think there will still be an expansion in the larger centres in the rural areas where there might be an overall decrease in employment. It is my understanding -- having looked at some of the materials -- that some of the larger cities now have quite a bit of growth. A pleasantly surprising experience is the way in which a small town like Clinton -- I'm sure you've driven through Clinton -- which has struggled to maintain its population size, has experienced quite a bit of growth over two or three months.
We are seeing a return of employment in a lot of the rural areas of the province, but we have redirected our resources and tried to focus on those areas. I often talk about trying to help communities to stabilize their job base.
L. Fox: I thank the minister for his answer. I am sure that Clinton is probably feeling some spinoff from the pressure in the Fraser Valley and so on, and we are looking at some growth there.
My concern is that there are many regions of the province where the opportunities are not the same for small business and job creation as they are in the urban centres of the province. I wanted to ask specifically what this ministry was doing, first, to understand the extent of the problem, and second, to come up with some direction as to how his government might improve the climate in order to encourage investment in those areas that are not growing and are very important to the economy of British Columbia.
Hon. D. Zirnhelt: We are continually trying to refine our understanding of what's happening in the regions. As a result, we work closely with the Ministry of Finance to put out reports. I'm sure you've seen those reports with the indicators in them.
Interjection.
Hon. D. Zirnhelt: Well, averages within the.... There's always change, and to come up with some generalizations that apply in all places is difficult. The whole reason we fund the local economic development program is so that people who understand the local situation can help analyze what's going on in their own communities. We are continually monitoring what is affecting the growth and development of industries. For example, we know that there is growth potential in the value-added wood industry. As a result, we look at employment in that area and the conditions under which those kinds of industries thrive. We are doing that continually. It's not just the provincial government; the local economic development commissions also do that. We provide to them aggregated information for a region -- averages and so on -- and they know what's happening in their communities. To develop the data that you're talking about would require resources well beyond those of this government or of any government.
L. Fox: I'm rather disappointed with the minister's response, because I don't think it would take a whole lot of effort to gather those kinds of data. The minister suggests the economic development commission of an area will help to provide that kind of information. I have to suggest -- and if the minister were well aware of the economic development issues in the province, I'm sure he would recognize -- that the only areas that have economic development commissions are large urban areas. Many small, single-resource communities don't have such a structure. Their driving force is their elected municipal people; they don't have economic development commissions.
I had hoped that the minister might have gotten into a concept plan. He told us earlier that we now have 24 regional economic development officers in 22 different regions. I had hoped that he would have used this as a tool and outlined the kind of programming these people were going to do in order to enhance economic development in specific regions, rather than using averages produced by the Ministry of Finance for setting global policy.
[ Page 6741 ]
Hon. D. Zirnhelt: I think I misunderstood what you were saying. When you talk about studies or analyses, you must realize that you can spend $20,000 in a particular community and still not have all the data you want. But the people in the field are continually trying to analyze the general data and how it applies.
Since I understand where you're questioning is going, I'll give you some of the activities that the regional economic development officers are supposed to undertake. You're right -- and I've often said in the House -- that these people are there to provide services to those communities that don't have them. We have tripled the number of people in the field; and when they're in place, they will be able to assist those communities that don't have local economic development commissions. They have to work with those as well, because as you've correctly said, there is spinoff to smaller communities from some of the larger ones that do have economic development commissions. The communities that aren't large enough -- and I would use the example of Valemount, which has minimal funding -- will get additional services from one of the REDOs who's working in Prince George. The people in Vanderhoof can work with the smaller communities around it to the extent they need some economic planning. The REDOs will do strategic planning in any community to the extent that they have the time, but I expect they will be able to help every community in their area. They will be working at developing the capacity of the community itself to form community development, adjustment and strategic planning initiatives; and identifying program needs -- if the problem has been analyzed -- in order to deliver existing ministry programs. They will work with the various agencies that have an impact on economic development in the communities and try to pull them together.
I could give lots of examples of what the ministry staff has done in those that are in place. For example, there's a project coming up on June 12 in the Comox Valley where the REDO will be helping the community, including economic development agencies and planning groups, develop a community vision. It's a result of the visit to the community that I made some time ago. I initiated talks between the people in Economic Development and Social Services. There are lots of examples of them doing that work.
L. Fox: I guess I was looking for a little more proactive planning from the minister on how we were going to diversify the economies, because so many of the rural communities are single-industry towns. They survive on either the forest industry or the mining industry. Very few of them have the privilege of having a diversified economy which allows them to be part of more than just one industry. However, I'll leave that for right now.
In reading the Blues, I noticed that in your budget you have an industrial incentive fund of $40 million. There was some discussion on that yesterday. Out of this, the question that again came to mind was the Vanderhoof Pulp and Paper initiative. If the infrastructure needs were going to be met, would it have to come out of that specific fund, or are there other funds available for those purposes?
Hon. D. Zirnhelt: It would only if there was a loan or an investment by the government in it; but infrastructure, no.
L. Fox: Thank you. So this particular fund is for loans or an investment to be paid back to government at some point at a later date? Okay.
I had one other question in my mind. Recently in Parliament in Ottawa, there was a patent protection act passed. During that debate, the drug companies made a commitment to look at B.C. and other provinces to expand their research and development. As I understand it, last year there was only $3 million spent in British Columbia. Given the commitment made by the pharmaceutical companies, what action has this ministry taken to encourage those pharmaceutical companies to invest some of those committed dollars in British Columbia, versus other provinces?
Hon. D. Zirnhelt: You have chosen an area in which we share responsibility with Health, to a certain extent, but also Advanced Education.
Interjection.
Hon. D. Zirnhelt: Well, everything is a small business. You could say that therefore we're responsible for everything in agriculture and in forestry. As I've explained time and time again, where there is a ministry that has a lead role, we assist that ministry. This ministry has shown the pharmaceutical companies what strengths there are to operating in the economic environment here in British Columbia. We have worked with the Ministry of Advanced Education, Training and Technology on that and helped to articulate the strengths of the biomedical research capacities at UBC and in the province.
L. Fox: Just to follow up on that so I can be sure as to the action, would the minister like to give me a point-by-point action plan that has been conducted so I would know to what extent you are trying to invite.... It's a great opportunity, in my view. I specifically know of two companies that are looking to invest in British Columbia, in this particular area. They are, however, somewhat concerned because of the taxing policies of this government. I would like to know what action is planned. It specifically falls within your ministry, because it falls in the investment area. My understanding is that something like $10 million in new investment is available for this specific purpose in 1993. So I want to know what specific plan you have, as the Minister of Economic Development, to try to encourage that money into our economy.
[2:45]
Hon. D. Zirnhelt: We have people working in this field who are meeting with the companies and other agencies like the Advanced Education ministry and the research establishments at UBC. Merck Frosst,
[ Page 6742 ]
for example, has announced its intention to establish at UBC, and invest, I believe, some $15 million if the province invests a similar amount in the building. But we are not at all convinced that having made the efforts to get them here that the benefits outweigh the costs of that particular legislation. The increased costs to this government for drugs is a major concern to us. You rightly point out that as an offset to that we're supposed to see investment in this province. But there's already a critical mass of investment in this field in the province of Quebec, and they're fighting hard to establish it. One of the problems we have is to get to the critical mass here, and we have continually argued with the federal government that as a result of their legislation it's absolutely essential that they assist us to establish an industry here.
Specifically, what we're doing is meeting with them and providing them with the information about the advantages of operating here. I know of no public comment, by any of these companies, about their concerns about a specific tax policy. I would be happy to address that if we were to get any.
L. Fox: First of all, I never suggested that any of them made any public comment. I suggested that I had spoken to two of them.
Secondly, while I respect what the minister is saying, the fact of the matter is the impact is there in the way of costs, whether we like it or not, because the legislation is passed. If we're going to reduce the impact of that and if we believe there are more costs, then we should be out there literally selling British Columbia as an opportunity for research and development for these companies. We shouldn't be sitting back and waiting for them to contact us. We should be literally going out there and soliciting those companies that we know are in a position to invest R and D money in Canada in the next year.
My final question -- or a series of questions -- is around Build B.C. What kinds of dollars does your ministry see being funnelled through your ministry, in cooperation with Build B.C. How is that going to work?
Hon. D. Zirnhelt: The way our ministry operates with Build B.C. is through my representation on the committee, where we try to take a regional perspective to the committee. There are no program dollars allocated to my ministry as part of the Build B.C. initiative. We will look at the plans for the regions, and try to ensure that any investments work with plans that have been made. But as you probably know, in a lot of regions there aren't existing well-developed plans that you can automatically fit into. But to the extent that there are plans, we will fit into them and help Build B.C. work with the existing local priorities.
F. Gingell: I'd like to return to the subject of the B.C. Pavilion Corporation. Early in its mandate your government created a new government bureaucracy called the Crown corporations secretariat. B.C. Pavilion Corporation is, I think, the only Crown corporation that comes under your jurisdiction. Would you please advise us as to what work or proposals or studies have been done by the Crown corporations secretariat since it came into existence, and is anything ongoing planned for 1993-94?
Hon. D. Zirnhelt: I'm going to assume that you're asking about studies that relate to Pavco, because I can't answer for all of the activities of the Crown corporations secretariat.
F. Gingell: Only for B.C. Pavilion Corporation.
Hon. D. Zirnhelt: I just wanted to correct that. I know of no studies that they're doing. All of the Crown corporations had an initial meeting with the Crown corporations secretariat.
Interjection.
Hon. D. Zirnhelt: Yes, to put them on a business-like foundation -- to go out and be entrepreneurial and reduce their dependence on government.
We keep in close contact, but B.C. Pavilion Corporation is well run. It has a management that is, in my view, quite entrepreneurial in terms of looking at its own market needs and its need for capital investment. To my knowledge, no studies have been initiated with respect to the Pavilion Corporation, and I think that's a mark of our support of its management.
L. Stephens: We have just a few more questions to ask, basically to do with regional and community development. The development regions branch develops programs such as the Queen Charlotte economic development initiative. Are there other initiatives like that one around the province to help the pursuit of economic development in specific areas?
Hon. D. Zirnhelt: I'm sorry, I'm not sure of the question. The development regions branch doesn't exist anymore. We have a community economic development section now. We've just gotten our staff in place in the last few months, so they will be developing work plans. Some initiatives are underway. For example, on the north coast there's a value-added wood fibre study, involvement in the land claims negotiation and work with Orenda pulp and paper. Some are regional-specific, some are project-specific. In the Nechako area we're looking at cogeneration initiatives. There's a tourism strategy, which is an overall strategy, and there are literacy initiatives. In the Thompson-Okanagan we're continuing to look at regional transportation needs, tourism initiatives, and science and technology initiatives.
I could go on, but I'm not sure that I'm answering your question.
L. Stephens: I wanted to know specifically whether, with the reorganization of the ministry, there were any new plans in place to develop the initiatives formerly done by the rural development branch. However, the minister has answered that those are in progress. It's just getting going, and these things will be
[ Page 6743 ]
coming forward. So we'll be asking about it from time to time.
Yesterday the natural resources fund was discussed at some length. Just skimming the Blues, it wasn't clear whether or not there was a lot of discussion on the training, skill development and worker relocation initiatives. Could the minister tell the committee what has been done in regard to those initiatives -- job creation and skill and training development -- in the single-industry towns and in the regions around the province that the natural resource community fund was set up for?
Hon. D. Zirnhelt: Each of those communities that indicated an interest has been sent an application. We expect some applications where there is a shortfall in the federal-provincial funding that's already in place through the industrial adjustment service. There is some indication that some of these communities won't have sufficient funds. We fully expect applications from a number of communities in that area. It will be for those where significant downsizing or closures take place. So those activities -- training and skill development and worker relocation -- are eligible for funding under the NRCF.
L. Stephens: So, at this point in time, nothing has come forward from these communities with regard to developing job training, skills upgrading and so on.
I'm sure that the minister appreciates the importance of worker retraining and skills development. Just as an aside, I hope that the Ministry of Economic Development will be very active in the symposium coming up in June at BCIT dealing with worker retraining and skills development. I encourage the minister to be very aggressive in participating in that endeavour.
I know the minister understands that these one-industry towns are becoming more pressured. I would certainly support the minister in bringing those kinds of initiatives forward much more quickly and in making the communities aware of what is there for them in order to move the process along. The longer we take to develop these kinds of programs, the more difficulty we will be in.
I know cross-border shopping was discussed briefly as well. The minister must understand that the retail industry represents about 15 percent of B.C. business, employs about 145,000 people and represents 50 percent in the lower mainland. Cross-border shopping has diminished to some extent this past year due to the dollar, but it's still a concern to businesses. The largest concern, of course, is the taxation question. The chamber, as you know, has put forward a number of recommendations. I would like to know the minister's response to the recommendations that the province negotiate an agreement with Revenue Canada for the collection of provincial sales taxes at all the entry points for consumer goods purchased in the U.S., and that the existing Canada Customs laws be strictly enforced. Finally, has the minister contemplated establishing a task force on cross-border shopping?
Hon. D. Zirnhelt: In reverse order, with respect to task forces, because so many of the factors are federal issues -- and you mentioned a couple, like collection -- we are on the federal task force and work actively in that area. It's not a B.C.-specific task force, but where there is a local problem, there are people working locally. The Minister of Finance advises that strict enforcement is something that he pursues frequently and vigorously with the federal revenue minister.
I think the chamber is also suggesting that we harmonize with the GST, which is something we're not prepared to do at this point, because it does spread the taxation more broadly than we would choose at this point. The specific recommendations of the Chamber of Commerce.... I will be meeting with the new president, hopefully in the next week or so, to go over a whole agenda of issues that they have. As you know, they frequently prepare documents for each department. We will give a full and detailed response at that time.
You did ask a supplementary question and make some comments on training, skill development and worker relocation. We are very vigorously pursuing those communities that are worst hit -- single-industry towns like Port Alberni, where there's been massive amounts of effort by our department over the years, which we have renewed -- to work, quite successfully, I think, with diversification activities there. There is diversification potential there.
[3:00]
We are also working with CORE. With some of the experiences in the Pacific Northwest where, because of the spotted owl and other timber deferrals -- and log exports, I must hasten to add -- there's been a wind-down in economic activity.... We want to learn from the experience of those communities, share our experience and try to get some of the people who know the most about it, so that our people who are working out in the field have the latest knowledge about what happens around the country.
Our regional economic development officers have information; when they are fully staffed, they will make sure that the business information centres and community agencies have information on the programs that are available. One of the reasons we instituted the natural resource community fund is to have a program that can pick up those pieces that fall through the cracks. Our people are very vigorous about making sure that people have the information, that the local committees exist where possible and do those things that the community can do itself, and that we draw in advanced education -- colleges and so on -- to work on a comprehensive strategy for skills development in the area.
L. Stephens: I was pleased to hear you say "comprehensive strategy for skills development." I haven't heard much from the government side at all about a skills development strategy. The way our economy is changing, we know that we're going to have to have very extensive skills retraining, training and so on and so forth. Jobs and the economy are the two top issues on people's minds. Many people around the
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province -- not just in our resource-based towns, but all people -- are concerned about the stability of their jobs. It really is unfortunate that this discussion hasn't come from the government up until.... Well, it's still not there. I can't impress strongly enough on the minister the importance of this job training and skills training. When the government does come forward with a strategy to deal with this, I am sure the whole province will be interested and waiting. I know the opposition will be, because that's something that is critical -- extremely so.
We will conclude with one more question. I'd like to know if the minister has given any consideration to creating special economic zones in the province to try to compete somewhat with the economic zones in Washington State. Has the ministry conducted studies on the feasibility of such an initiative? If so, what would they be?
Hon. D. Zirnhelt: I have to say that special economic zones are continually being studied, but this is not one of the primary focuses of the ministry at this time. The reason is that the studies indicate the advantages may not outweigh the cost. In other words, when you give a tax break for a special zone, you lose tax revenues; what you gain by the additional activity may not offset that. So that's the primary reason.
I would like to point out that I am a full participant in the Premier's economic summit on skill development. As I travel around and meet with economic leaders, I bring in education leaders and others and sit down and talk about the desirability of putting additional funding and emphasis on skill training. In my own experience, wherever I work with community groups looking at economic development planning, they always find there's a need to facilitate, or to develop the capacity of the communities themselves, to ensure a linkage between the needs of small business and industry in a community and to articulate those needs.
For example, a lot of the agencies involved in skill development will say quite often that they're not sure of industry's specific needs. So I've had the experience of sitting down and encouraging a dialogue at the community level between the agencies developing the skills and the industries and businesses in an area. We can facilitate that if it is not being done in the community. We generally look at the development of leadership capacity in communities to deal with the whole range of things: the provision of capital, training, infrastructure, assistance in dealing with regulatory regimes -- whatever small business needs. Looking at the whole thing, what always comes up is skill development, and I don't think we can ever devote enough resources to that.
R. Neufeld: My colleague talked earlier about jobs in urban areas and in the rural parts of British Columbia. I agree with the Liberal critic that jobs and taxes are probably two of the items that come up in most discussions. I think people are very concerned about jobs; the young people are concerned about not getting jobs. Every time I speak in the House, I talk about jobs. I'm not talking about jobs created by government with a few more million dollars here or there, just to keep somebody going for a little while. I'm talking about real jobs out there in the real world.
I'm going to go to a little of your campaign material -- not specifically yours, but your party's. There were a number of promises or indications given about economic development in the province. Maybe you could enlighten me about what progress you've made on this promise. I won't read the whole dialogue, but I'll read part of it: "A New Democrat government will work with the business community to develop new markets and new products that diversify our traditional resource base." I know pretty well what our traditional resource base is in most of British Columbia. Maybe the minister could enlighten me as to what markets have been opened up in the last 18 months since this government took over and he became minister, and how they have diversified the traditional resource base to create new jobs.
Hon. D. Zirnhelt: We have worked fairly extensively -- and the B.C. Trade Development Corporation has the lead -- in developing new markets overseas. We've worked on developing markets for wood products, which then feed back to the development of value-added industries in our communities. We're looking at additional markets for value-added food products -- for example, value-added fish in Japan. I participated in some meetings that dealt with trying to open up those markets. I don't have with me here the specific measurements of export activity, but I'm sure it can be provided to you.
Mitsui Homes, for example, has set up a plant in Richmond, I think, and they will be exporting. So here is a plant that's opened with foreign capital. Those have all been facilitated by the government. There has been further development on Toyota's second expansion -- the market for wheels in the world is considerable -- there's the CAPTIN plant in Richmond. CIPA Lumber, which is owned by the Hochu Group, is spending $15 million to purchase and reopen the Delta plywood plant. So that's a reopening. But finding a new market to provide an additional source of sales for the plywood product, which, as you know, has high-value-added activities, or lots of jobs for the amount of timber they use.... So we have worked on opening markets in Korea, Taiwan and China. It takes a while for them to mature, but we have emphasized those three.
We said we are working with business, but it's actually business and labour, because we find it very useful that labour leaders understand the world economic environment for which they are producing goods. So we have them along on the trade missions with business people to showcase their products and to understand what kind of competition and opportunities are out there.
So the trade missions have opened up some new markets. Our ministry is working less in that field. Export promotion is B.C. Trade's responsibility, the responsibility of the Premier, and I would encourage you to get into that debate there. We work on the investment and work with B.C. Trade to make sure
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there are investments that match the market opportunities. Where we identify an opportunity in value-added wood or metal manufacturing, for example, we will then encourage investors, who often come looking for an investment.
R. Neufeld: Would you say that your ministry played a large role in the expansion of the Toyota plant and CIPA Lumber's initiative to reopen the plywood plant?
Hon. D. Zirnhelt: Yes. They were initiatives that were established, but they are expansions which diversify into other markets, working with existing businesses to expand. You shake your head, but.... Well, the other member is shaking his head.
Interjection.
Hon. D. Zirnhelt: That's better. I wouldn't want to impugn you here.
Eighty percent of jobs are created by the expansion of existing businesses, so you have to look at the expansion. We have emphasized the growth of small to medium-sized firms. We have worked very extensively to match businesses in this country with investments and marketing opportunities in other countries, through their organizations and government departments that relate to their medium-sized businesses. We can't ignore medium-sized businesses. Those are the ones I have mentioned here. They have considerable growth potential, and we work with them very closely.
R. Neufeld: I agree with what you said about labour and about having labour as a component of the Premier going oversees or your ministry doing some work over there, so that labour and government can see the competition that is there, whether it's in labour costs or taxes. Your government has been attacked quite a bit about increases in taxes, regulations and paperwork. I hear about it all the time. Those have continued to increase.
A lot of regulatory fees have been increased by up to 400 or 500 percent. That's in relationship to a few hundred dollars -- percentages can get a bit out of line. Specifically, for things such as land deals, where farmers are applying to subdivide, those fees have gone up probably by about $250. I know that's under the Ministry of Agriculture, but it still affects jobs and economic growth. It still affects the farmer, because the farmer is a small business man, and he's an important part of British Columbia. But we have had a litany of taxes and fee increases that your government has imposed.
In fact, the other day I got a letter from someone in a small business in Fort St. John who is absolutely refusing to pay the fee increases he has been billed for. He has a hotel, and I think there were eight new fees for different parts of his hotel business. That isn't conducive to businesses that create important jobs in B.C. or to the agricultural community.
I was at the Ministry of Forests offices the other day talking about grazing fees. I know that is part of the Ministry of Forests, but it's also about jobs and about the ranching and farming community. They're facing increasingly more paperwork. Water licences and water fees -- you people seem to know no end. Yet in promise No. 6 in "A Better Way," you say: "A New Democrat government will help small and medium-sized businesses grow. We will work with business to achieve regulatory reform and reduce the paperwork burden." I say to you, minister, that your government has not done that; your government has done the absolute opposite, and it's having the opposite effect. Obviously you were there in the cabinet committee when you discussed the tax increase. Did you even look at what putting sales tax on labour would do to small business? I ran a small business that paid $60,000 to $70,000 a year in labour costs to a garage for maintenance on equipment. The person who owns that business is now going to pay another 7 percent on that. He doesn't have any place else to go to retrieve that money. It's either close down or lay someone off. It gets to the point where you apply so many taxes that businesses just start eliminating people. They go on unemployment insurance or welfare, and that doesn't help at all.
As a minister, what kind of drive are you going to make in your cabinet discussions about new taxes and the effect that they will have on investment in this province and on the creation of jobs -- or even on just keeping the jobs we have now?
[3:15]
Hon. D. Zirnhelt: To the extent that we have information -- and we try to get it on all sectors -- we provide impact information if it's available. If there is a negative impact that we can see on a particular sector or a particular business, we make that known. It's available.
Interjection.
Hon. D. Zirnhelt: Yes. And you know that once the government takes a decision, we stand by it. I need to remind you that I make those views known where they are articulated, and I have no problem holding my head up in public and saying that I do that.
As a result of some of the activities -- out of concern for this -- we left the small-business tax rate. We didn't tax restaurant meals when there was some fear that that would happen. The threshold tax on capital was raised, with some significant benefit to those.
We have also been successful in establishing a process whereby, before a tax or fee is imposed, the impact is known and we get some discussions outside of the budget process. Once the tax is set, or as it is being set, it's set on a confidential basis. What we can do, are doing and have done with the tourism industry, and will do with the agricultural community and any others that we can engage in it, is look at the whole range of effects on that business -- the costs of productions that are not government-related and those that are government-related -- and look at the cumulative impact. While we don't have all the information, we now have a method in place for doing that. We will be engaging small business.
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With respect to the comment about platform point No. 6, you have to remember that that is a platform we will be working on for the full four years. We don't expect to be able to deliver on everything in the first year or two, but I don't think we have in any significant way added to the paper burden. If you ask small business, a lot of the paper burden is federal. With respect to what we're doing on that, if there are regulations that are unnecessary, then it's important to address those through this process of consulting and looking at the cumulative impact of regulations, because there are some things that have to be regulated.
The whole point of having fees and licences is not for the revenue they produce; it's that a fee is there to cover the costs of providing the service. It's either an inspection fee or a fee for administering that resource. In all fairness, the people who ought to bear the burden are the people who benefit from the service that's provided.
R. Neufeld: It's interesting that the minister said that before you put a tax in place you have discussions and find out what the impact will be on the people of British Columbia. I wonder what happened with the tax you put on homes over $400,000 that you had to backtrack on. So I don't think that is working all that well.
You said there were some methods in place to find out.... You've just got them in now, because it's going to take a while, and I appreciate that. What methods do you have in place now to monitor small business? I've been in small business for quite a few years. I can tell you that we experienced increases in fees before, and I know what that did to us, including the increase in paperwork. Some of it was warranted; but as far as I'm concerned, a lot of it wasn't. Some of the regulations that are put into place just increase employment within the government. It takes more people to monitor it, and in most cases it isn't needed.
I'll take the monitoring of grazing fees for an instance. I'm sure you're familiar with what happens now with the Ministry of Forests. They go out and measure -- if the grass is four inches high, you can turn your cattle out. Things like this take more people. You and I have been in the agricultural world. Is it your opinion that cattlemen and farmers have to be regulated so heavily as to be told when they can turn the cattle out on grass that's four inches high or not? We both know that that rancher or farmer is not going to destroy his livelihood. In most cases those people have been on that land for more than one generation.
When you increase the amount of people to monitor these people, so that they can pay some more fees and have some more regulations put on them, it just gets to be a cat-and-mouse game. Who finally wins? The small businesses give up. They're to the point now where they're just about ready to stick their hands up in the air and say: "I give up." There are a lot of them. There are some younger ones, I grant, that are gung-ho, and they're going to go. But there are a lot of people who have been around for a lot of years and are ready to quit, Mr. Minister. The fees and regulations from government have just hampered their operations so much that they don't know what they can do.
Guides and outfitters are another large...
L. Fox: You need to hire a lawyer and an accountant now just to fill out the paperwork.
R. Neufeld: ...part of my economy in Peace River North.
The member for Prince George-Omineca said they need to hire a lawyer to fill out all the permits and fees. Then on top of that, you pay 7 percent tax on the lawyers' fees. You talked a bit about not wanting to align the GST, but it seems to be going that way. I take exception to you saying that you've lessened the paperwork and the regulations. I think you've increased them, and you've increased them dramatically. It's affecting the business and corporate world; it's affecting whether people are going to come to British Columbia and invest. We don't have a lot of investment that I know of. But maybe you could help me: tell me how many millions of dollars of investment we've had in the last year in British Columbia in creating new jobs, and how many jobs that created.
Hon. D. Zirnhelt: To answer your last question, there is approximately $25 billion worth of investment in various stages of development in B.C. We've had more business start-ups than we ever had in B.C.
Interjection.
Hon. D. Zirnhelt: All over the province. Check the building starts in your own home community.
I have to correct the member in that I have never said we have lessened the burden. I said it's an intention to examine ways to lessen the burden. But I have to remind you that a lot of the burden is that of federal regulations.
With respect to the one example you used about whether cattlemen know to turn out when the grass is four inches high or not, you have to ask what would happen if there weren't a regulation. All it takes, as you know, is one or two years of doing that to knock it back. There's an argument that B.C. has better grass, certainly, than neighbours to the south. One of the reasons is that there has been good regulation. If there is arbitrariness in the regulations, then I would encourage those responsible in the Ministry of Forests to work closer than ever with people in the agriculture community to go over that. I know they do, on a constant basis, but people gripe a bit. They don't want to be regulated. They would rather do what they want to do. A few people out there need the regulation, and I think the most constructive way is through peer pressure. But you've got to have the regulation to back it up, because there's no other power than that of the regulator to do it.
I'm not aware of new regulations. They're changing all the time, but you've got to protect the general regime that's there for all of the resources. I think we're going through this experience where members of the public are saying to people operating on Crown land that they want other resources, like water, protected. That's why
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there are some regulations in place. There may be a sense of unfairness, but when pricing Crown resources it has to be realized that they have to generate a revenue equal to the cost of administering. We're nowhere near that, and it's going to be difficult to get there. In recognition of that, the Minister of Agriculture indicated, on behalf of the government, that water fees and grazing fees have been frozen pending the very review that will look at putting those things on the table and assessing their cumulative impact.
R. Neufeld: I agree that there are a lot of federal regulations. I don't dispute that. There's also a lot of provincial regulation. I guess it's the same as taxes: as far as the person who's living under those regulations is concerned, it's government. You know that as well as I do. Try to tell them that it's not your fault because it's the federal government's jurisdiction, and they say: "Look, I want something done, and you're the closest person to me." But as we continue to add to those regulations, it just makes it worse.
The minister says it's only fair that the fee should pay for the services provided. In the budget this year your government put in 1,200 new FTEs for the province and 1,600 last year -- 2,800 new employees in B.C. At that rate, I don't know whether the poor guys who are paying the fees and licences are ever going to catch up.
You talk about encouraging growth and investment in British Columbia. I have an article here from the Vancouver Sun, May 20. I'm sure the minister is aware of it. It says: "Move to B.C. Much Too Taxing." An executive saves himself $50,000 by having a job in Burnaby and living in Bellingham. If that's happening, then something's wrong. If we're encouraging people to live across the line and come into B.C. to work at jobs that are fairly lucrative, we're losing all kinds of money. That's basically what I was trying to tell the minister before: that if we continue to increase regulations and fees, thinking we're going to get that much more revenue, we drive business underground or across the line. Those people still come into B.C. and very likely enjoy our medical and other programs, which are second to none in the world; but they live across the line because our systems of taxation and regulation are so high.
[3:30]
What are we going to do to combat that and encourage people who work in B.C. to live in B.C? How are we going to encourage people coming from other places to invest in B.C., not just in a $200,000 home on the Island so that they can retire forever? That's basically where all the job growth has been. If you look at some of the studies, it's in the lower mainland. I think the minister even alluded to it earlier -- that the jobs are happening where all the houses are being built, and the growth is in people. But that doesn't fuel an economy. That doesn't give us the money we need to keep the investment and sustain the programs we already have. What are you doing as the Minister of Economic Development to combat that? Maybe you could tell me a little about it.
Hon. D. Zirnhelt: I don't know the details of the example that you're quoting. My guess is that if those are the taxes, he's probably making $250,000 a year, and we're not going to apologize for the fact that he may have to pay a few more taxes up here.
The services that are provided by this government are superior to those provided across the line. We would have to look at it, but when we studied all of the taxes for a small business operator in Washington and in British Columbia, there's in the neighbourhood of 20 percent less in taxes. Yes, the personal part of it may be higher, but the corporate part is lower than in Washington. All told, there's upwards of a 20 percent advantage on the tax side in operating a business -- everything from the municipal rate through to federal taxes. The facts we've put out are unassailed. When confronted by those facts several months ago on a radio station, a Whatcom County economic development officer had to admit that when you take everything into consideration, yes, it might be better to operate in British Columbia.
Why do we continue to get the growth? People come here because of the services and the lifestyle. Obviously the taxes aren't too much or they wouldn't continue to come here. But I have to admit that any taxation has some depressing effect. Everybody would like to operate without any fees or regulation. It's the fairness of it and what it does to the competitive position. We have studied the competitiveness of advanced manufacturing, for example, an area that should grow on its own, and we're satisfied that it will continue to grow.
A member from our side who has just entered the House can attest to the fact that in Taiwan, where he and a representative from the B.C. Investment Office met with a number of businesses, they did not raise this issue of taxes or labour code. They know what the environment is here; they think it's a wonderful place to invest. We're very optimistic that people will continue to come here. But you do hear in the press that the odd person is concerned. Maybe quite a few people are concerned, because they would rather have no taxes, or lower taxes, to give us an advantage. Then they would be complaining about the taxes somewhere else. We are concerned that we remain competitive in this province, and we recognize that if we do anything that makes us uncompetitive, we'll be cutting off our nose to spite our face.
You talk about the increase in the number of FTEs. I just have to point out that we're being honest about the accounting. A lot of these are conversions from contractors. In fact, in the figures that I have, there's a growth of 300, or about 1 percent of the public service, when the growth in the economy is pushing 3 percent. You say there's more government. The government share of GNP is actually reduced. Government is a smaller part of the GNP than it was a few years ago. It has marginally declined.
Earlier you were asking about regulators. There have not been large increases in the number of people that affect many of the sectors. In fact, a continuing problem for us is that we're not able to enforce existing regulations. We would like to do more of that. There are people out there asking us to protect certain resources
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for their use and enjoyment, or for their businesses. When you get conflicts between resource users and no way to solve them, you have to have an intervener of some kind, and government has done that. But we have not substantially increased that burden.
R. Neufeld: The people who hear you say that you need more people to do more regulation but that you can't afford it are probably saying to themselves: "I hope you can never afford it, because I've got enough now." There's no doubt that regulation is needed in some areas; I agree with that. Regulation is probably needed in all parts of government and Crown resources and those types of things. I have no problem with that. But it gets to a point where it's overregulation.
[F. Garden in the chair.]
I'm going on to something else, and it's another point in your "A Better Way." My colleague asked a little about B.C. 21, and you didn't answer very much about what involvement you had had with it, but it says: "The New Democratic government will work with local governments and communities to make sure that every region gets its fair share of economic development and opportunities." I would assume that falls into your ministry.
With Build B.C. and what you're going to do with it, could the minister tell me that he's going to see that each region of the province gets its fair share and how he feels that fair share is going to be done -- by population, by region or by need? On what level is this minister going to work at to try and see that that development takes place in an even way across the province?
Hon. D. Zirnhelt: As I've said before, we will look at needs in the regions. We have indicated that there are, in effect, two economies in B.C. One of the reasons we've created this instrument is to try to address problems that otherwise couldn't be addressed. We will be focusing, through the B.C. Investment Office, on the regions that need projects. It has a regional focus. There are a number of projects in each region. We will continue to try to find investment locations in regions to match investment opportunities with the investors that come through the door of the B.C. Investment Office. Our people in the regions will be looking at the opportunities. We will be articulating the opportunities and the needs through the B.C. 21 committee to the extent that we have good information available. For every 100 projects that are out there, only ten of them might see the light of day as being feasible, but we will make some assessment of the needs available to the people considering decisions on B.C. 21.
R. Neufeld: I thank the minister for assuring me that we'll be dealt with fairly across the province and that he'll be there making sure, when those decisions are made, that it will be fair across the province, because I think there's probably some fear in some parts of rural B.C. that things may not happen, for whatever reason. I think there are all kinds of programs that could go ahead; I can think of one in my constituency that's on the table. It doesn't need any engineering or any okays or whatever, and it could have gone ahead two years ago but hasn't yet. I hope that that's taken into consideration. That will create jobs.
Did the closure of Cassiar and the annihilation -- levelling -- of the town of Cassiar have any effect on your ministry? If it did, how many dollars would have come out of your ministry? Or did it come out of some other ministry? Maybe you can help me a little bit there. I'd also like to know what happened to the people that came out of Cassiar in job retraining. Have they been put into new jobs? Or are those people on unemployment insurance or still trying to find a job someplace?
Hon. D. Zirnhelt: I don't think we have a final report on the Cassiar situation, and we may not be able to track what happens to everybody. I'm not sure what it would serve. I think we know that a lot of people have been relocated, but I don't know how many. We could probably try to get some information on that for you; I don't have that with me here. We made attempts to keep Cassiar up by having a Peat Marwick study done through the job protection commissioner, which shopped around looking for investment and buyers. As you know, at the last minute there was some interest, but nothing materialized. We were participants in a committee there that assisted in the winding down of the town. As for dollars that we actually contributed to Cassiar, there was a write-off of a loan. I'm not sure if that's what you're asking for. Seven hundred thousand dollars of the $5 million loan was written off. A lot of that went....
Interjection.
Hon. D. Zirnhelt: Yes. There were other funds spent, but our ministry wrote off $700,000 of the $5 million loan.
The Chair: The member continues, through the Chair this time.
R. Neufeld: I apologize for that. I was just trying to speed up the process a little bit, because I've got a couple of questions yet.
I appreciate knowing the amount of the loan, but what other dollars were expended by your ministry specifically towards the closure of Cassiar, the retraining of workers and trying to find those workers jobs?
Hon. D. Zirnhelt: There was a special fund established through Treasury Board. They did not flow the funds through our ministry. The Minister of Finance would be able to answer that; he has the specifics. Our ministry didn't flow the dollars.
R. Neufeld: Okay, I'll work on those later.
My last question is about cogeneration. My colleague from Prince George-Omineca also talked about Vanderhoof and cogeneration with natural gas. This is a big part of Peace River North natural gas. The
[ Page 6749 ]
Energy Council was out for over a year making up a report that came out just a while ago, which set some parameters for the export of electricity. Not too long after that the Minister of Energy came out with a report which okayed a fairly large sale -- I can't remember exactly off the top of my head -- of natural gas to some companies just across the line in Washington, where they were going to generate electricity with that natural gas.
When we talk about value-added, you talk about value-added in the wood industry, I talk about value-added in the natural gas industry and in the crude oil business. That's one value-added that we could do. We could generate that electricity in B.C., create some more investment, some more jobs and then export that electricity across the line. I don't want the minister to misunderstand me. I'm not saying that we shouldn't be giving those export contracts for that natural gas. It's all beneficial to the province, and that's what creates jobs in the north. But I think there was one further step we could have gone. We could have still produced the gas but also created some jobs by making it into electricity and then sending it across the line. I wonder what input the minister had with the Minister of Energy, or with cabinet, in making those decisions -- where we don't encourage IPPs to build in B.C. -- and your government hasn't -- and just sent the raw gas across the line.
Hon. D. Zirnhelt: With respect to raw gas going across the line, from the studies that we have done, I understand that there's an economic problem. It's cheaper to flow the gas through pipelines and have the electricity generated there, than it is to generate the electricity here and transmit it. So the economics of the industry are dictating a little bit of what's happening. We have undertaken through the B.C. Investment Office a major co-gen study. We've analyzed specific projects, and we will be providing the investment office and the advisory committee with a study that talks about the economics of the industry.
[3:45]
Just as recently as yesterday I met with some of my colleagues to discuss the Elk Falls cogeneration facility. Fletcher Challenge has made a new proposal to Hydro to actually generate electricity and natural gas. What makes the economics of gas-fired, or any co-gen, is the "co" part of it, where you're using the surplus heat to kiln dry, or something like that. In examining the opportunity for export of electricity, those that have export markets are actively working on coming forward with proposals. In fact, I think we have one application now for an export permit. But most of the projects cannot find markets. There is a difficulty in finding a market, because their costs of production are higher than what they can sell for. The basic problem is that if they expect B.C. Hydro to be the customer, it would require some subsidy, because B.C. Hydro would have to get less from it than its actual cost. The B.C. Energy Council found that the idea of paying a premium was not acceptable to the people. If we were providing a subsidy to a wood waste generator, one project may have an insignificant effect on Hydro rates for everybody, but many projects coming in under the same criteria would create a large cost, and we would be artificially affecting the economics of that industry.
I am hopeful that we will see some projects up and running, but even with the ability to export, it is still difficult to operate energy plants here on a cost-effective basis. But we will be assisting wherever we can.
R. Neufeld: I appreciate that the cost of wood-waste-generated electricity is more expensive. I think we knew that long before the Energy Council went out to check that out. That's something that has to be dealt with. It's another issue that maybe we can deal with in the Minister of Environment's estimates, because that wood waste is being burned regardless. It's a good way to get a dollar for it.
I'm interested in what you say. It's cheaper to export the natural gas to the U.S. and have them generate electricity in Linden, Washington, and sell it to the U.S. market than it is for us to generate it right here or even north of us. We could generate it in Fort St. John -- in fact there's a big co-gen plant there -- and export the electricity through B.C. Hydro.
That would lead me to believe that what you said earlier -- that it's just as cheap to operate in British Columbia as it is in Washington -- doesn't ring quite true. Maybe you can just explain that a little more.
Hon. D. Zirnhelt: I wasn't talking about operating costs; it depends on the location. You have to examine every site. The transmission loss on wires of electricity that's generated here is significant, and the transmission corridor cost is higher than for transporting the gas. Looking at the economics, often it's better to generate the electricity closer to the point of consumption of the electricity. That's the point I made.
R. Neufeld: I want to press that a little more, because there's no reason why.... We have the pipelines in place -- the same as the hydro lines from the north. We could generate that electricity in co-gen plants right here in the lower mainland, in Vancouver or the Fraser Valley someplace. That's not very far from Linden, Washington. Can we compete there if we generated it there? Are you telling me we still can't compete? I don't believe there's much line loss between Chilliwack and Linden, Washington.
Hon. D. Zirnhelt: I have to know which project, generally speaking. We do produce electricity down here, and it's some of the cheapest we produce for B.C. Hydro, but there's environmental impact here, too. If we establish them here, we've got airshed problems in the lower mainland, so that's a factor. My guess is that, yes, we're cost-competitive in producing it. I just have to fall back on saying that you've got to examine all the factors that affect the operation of the particular industry. You can't answer most of those questions unless you do an in-depth study of the particular project.
I was saying that given the situation, there are still marketing problems for the electricity. There is a
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surplus of electricity in British Columbia already, and it's among the cheapest that can be produced.
R. Neufeld: As far as air quality goes, I don't know how the minister thinks, but if you generate electricity with natural gas in Linden, Washington -- I'm not sure of my geography, but it's not very far across that imaginary borderline -- or you generate it in Chilliwack, does that mean that the pollutants, if there are any, from Linden, Washington, all stay south of that imaginary border line, that they don't impact on us? I fear not. I think it goes into the same air, and it's the same air that we breathe. I think that really the work that's been in cogeneration has delivered, as you say, a very cheap hydro. The companies that are buying that gas across the line to generate electricity obviously have some markets for it. I think Fording Coal had some markets already established that they were shut down on because the Energy Council had to do a study on it. That certainly doesn't lead to job creation or any kind of wealth of investment. I wonder what the minister thinks of that.
Hon. D. Zirnhelt: I think you're asking me to be an expert on wind, and you're a pretty good expert yourself. When you get into some specific environmental impacts, I can't comment; it's not my area of expertise. But yes, generally I guess I'd have to say that if there are two plants on the same side of an imaginary line, then there are generally the same regional environmental and economic effects. If that's the answer you're looking for, then I'm prepared to offer that. I really lost the point of your question, but I'm not an expert on the environmental impact.
But I can answer that when the government of the party that you represent provided a premium, it was done without any analysis. It was a deal to get a cogeneration up and running, and it didn't have the analysis that could stand any test of examination. We took some time -- a year -- to examine the whole role of energy exports in the economic development of the province. We have said yes, under certain conditions -- and that's out there. We're reviewing the conditions that were recommended by the Energy Council. They've recommended that yes, as long as there's no subsidy, there can be some energy export. We're hopeful that there will be a number of projects coming out of the new policy for which there is a market and that are viable and that will provide jobs.
But you can't say that cogeneration is the answer for job creation in British Columbia. Yes, it's one of the things that will produce jobs, and we're very hopeful that quite a number of those projects will be up and running.
R. Neufeld: I know that the cogeneration is not the answer to all the jobs in British Columbia, and neither are the issues that you talked about in value-added wood and in value-added in other places in the agricultural industry. That's not the answer to all the jobs in B.C., but if you put them all together they culminate in some investment in British Columbia, and they provide some jobs that are needed in B.C. That's what I'm talking about.
I don't think you have to be an expert on the environment or a rocket scientist to figure out that if you're going to generate electricity 20 miles across the line, that whatever goes into the air is going to affect us in British Columbia as much as it does the people in Washington. I think that's a pretty loose excuse on your part for not being there and trying to ensure with your government that we are doing everything possible to create value-added jobs in that specific industry. There are all kinds in other industries. Maybe the minister isn't strong enough in all the other areas -- in the wood, in the agricultural business and in the ranching business, all those industries -- at the table in letting the concerns of people in British Columbia be known to the rest of cabinet on the issue of jobs and the creation of economic development. I don't mean just in Vancouver and Victoria and the Okanagan, because that isn't where everybody in British Columbia lives. There are a lot of people who live in the other parts of B.C. who also need a little bit of help and encouragement. All I can say is that with all the additional taxes, fees, regulations, and maybe some of your ineptness in trying to get across to the rest of your cabinet members that it's very important to create jobs, part of the problem we're in today is caused by not seeing a lot of growth in the rural and northern parts of British Columbia.
I don't have any other questions for the minister at this time, so I thank him for his indulgence.
L. Stephens: I just want to make a few comments. The opposition has no further questions. I would like to thank the staff of the ministry for helping us through this process. Due to the reorganization of the ministry over the past year, there were a number of questions that we had to bring forward. I'm sure there were a few more that we could have asked as well.
I'd also like to say to the Minister of Economic Development that the people of British Columbia are looking to this ministry and to you to promote the economic well-being of British Columbia and bring forward government policy that allows for expansion and investment in the province. The opposition would like to see the minister pursue more vigorous initiatives to expand our markets and trading partners, promote our communities and regional economic development for all the citizens of British Columbia and support job creation, training and skills development for our most precious resource: the people of the province. With that, Mr. Chair, I take my place.
L. Fox: By way of a brief summary -- I'll try to keep it brief, because I know the Attorney General is looking over here constantly; he's waiting to see us conclude this so we can get on with the next order of business of the House -- I'll summarize the few days that I've had in the course of these estimates. I have to say that I was extremely disappointed in this minister not taking on the advocacy role that in my view he should in representing the interests of small business at the cabinet table. It's obvious from the course of action by
[ Page 6751 ]
this government, through the litany of fees and services and expansion of tax on the small business community, that small businesses can't feel comfortable that they have a minister who recognizes and represents their interests at the cabinet table. The upcoming year is going to be extremely challenging for this ministry, because the statistics will show that we still have two economies in the province; we'll find that the rural and northern economy is going to continue to drop in terms of the number of jobs, but we'll see jobs being created in the lower mainland and other growing areas around the lower mainland. That's a concern to me.
[4:00]
Hon. Chair, there's no real reason that we should consider profit as something which is not desirable. If we have a climate in this province that deters individuals from risking their capital in the way of investing it in small business, which.... As I pointed out before in these estimates, there are 500,000 people working in this province for companies that employ 20 or fewer employees. I know from my experience in a company of that nature that the encouragement is not there. Between the two levels of government, there's no longer any incentive for me to risk the holdings that I've achieved in order to do business in this province, because if I do make a profit, immediately this government looks upon it as something that gives it room to move in terms of taxing policies.
My colleague from Peace River North pointed out an issue, and in fact I respect what the minister suggested. It maybe doesn't reflect the total picture, but if an individual is making substantial earnings in a corporation in Burnaby but chooses to live in Bellingham because of the total tax package offered in the United States, that has to be a concern. While that certainly isn't the main problem, it's an indicator that this minister should look at, because it's a symptom of a problem. It should help to identify those areas of concern and those limitations to investment in British Columbia.
If we are going to be successful, specifically in the regions of this province, we have to recognize that the high-paying jobs we once enjoyed in the rural parts of the province are diminishing. They are being replaced with much lower-paying jobs in the value-added area and in other small business areas. There's a huge shift there and a dependency on government at all levels because of that shift.
We have to encourage development which will help us meet the demands in those other regions. We should not just stand up in this Legislature and say that British Columbia has the fastest growing economy in Canada, because that is an average statistic, and it applies a lot differently to Prince Rupert or Vanderhoof than to downtown Vancouver. The failure of this government to recognize that has indeed led to a weakening of the economy in many of those areas. The challenge for this minister is to be more proactive: be more of an advocate, and stand up for small business and say that there's no crime in making a profit. Profits in fact drive the investment in terms of small businesses.
With that, I want to thank the minister's staff and the minister for sitting through this sometimes tedious process. I do appreciate the opportunity.
Vote 23 approved.
Vote 24: ministry operations, $73,954,200 -- approved.
ESTIMATES: MINISTRY OF ENVIRONMENT, LANDS AND PARKS
(continued)
On vote 32: minister's office, $375,354 (continued).
D. Jarvis: I just have a quick question, and also a little bit of an appeal, that pertains to the Maplewood flats in my riding of North Vancouver-Seymour. As you are probably aware, it's one of the few remaining salt-water marshes in the lower mainland, especially in dirty Burrard Inlet and the environmental mess that it's in now. They are trying to clean it up, but they are short about $30,000 or $40,000. I don't know whether to ask you whether you could allocate some priorities or if you are already in the midst of it as part of the program that's going on. Are you familiar with that?
Hon. J. Cashore: Over the years I have had many conversations with Mr. Partington, who is very much involved in the Maplewood flats issue. With regard to the specific role of a component of our ministry at this present time, I don't have that answer with me, and we don't have the staff with us at this time who can provide that answer. It was our understanding, by agreement, that we were starting off with the Crown lands part of the ministry this afternoon and then moving into parks. If there were any further questions on Environment, we would have Environment staff come in at that time. We have made a note of that and will get back with an answer -- either during these estimates or directly to the member.
D. Jarvis: You are correct in your understanding, but I interjected in there because I had some previous appointments. I'm running back and forth between Houses and everything. I will look forward to your reply on that.
F. Gingell: The minister will remember that yesterday we were discussing the special account, and I have a couple more questions.
To quickly review, the revenue net of direct costs that goes into the special account comes from sales and easement leases. We were discussing the way they had been dropping in amount fairly dramatically in the last four years. In fact, they are anticipated this year at $37 million net after $9 million costs -- down from $67 million in 1991. You said that that was primarily a decrease in sales proceeds. The amount of the decrease is fairly substantial. Does this indicate that there is a change in this government's policy relative to the disposal of Crown lands -- i.e., that you are a little slower to dispose of Crown lands these days than governments have been in the past?
[ Page 6752 ]
Hon. J. Cashore: It reflects that some areas, such as the shore-land sales, are decreasing for reasons that were explained yesterday.
With regard to the general gradual decline in this area, I wouldn't go so far as to say that it reflects an overt change in policy, except I think that we're all cognizant that there's a renewed land ethic. More care, therefore, is being taken in terms of how we administer and dispose of the land and for what purposes. So in a number of ways the entire land base is under review. It's reassuring to know that the amount of land that is sold or leased within a given year is a very small portion of 1 percent of the Crown land base of the province. So it doesn't reflect some policy that says we're going to reduce it by that amount of money. It does reflect that a great deal more care is going into these considerations.
Hon. Chair, I would like to introduce two officials who are with me in the House who have not been introduced yet: Tracey Burns-Clark, who is manager of the Crown land account and Greg Roberts, director of land policy.
F. Gingell: Hon. Chair, can the minister please advise me how much of the lease revenue anticipated for the year 1993-94 comes from my favourite 4,212 acres of the Roberts Bank backup lands, and how does that rental income compare to last year?
Hon. J. Cashore: It is part of the calculation, but we don't have the details on that at this time.
[4:15]
F. Gingell: Perhaps the minister would make the commitment to send me that information and I'll pass it on.
There was an item in the special account called "Financing Transactions." When you read them it gives you the picture that these deal with the sale of land on term payments and the subsequent receipt of amounts owing on debts due from the sale of land that was previously recorded as a revenue. I'm having problems following that. Perhaps the minister could give me a better description of what those receipts are. The estimates say, "receipts represent repayment of outstanding loans and deposits made on pending sales." I presume then that the disbursements are the accounting for transferring the deposit to a sales proceed when the sale is finally consummated. Perhaps you could explain what all those things mean.
Hon. J. Cashore: If you'll bear with me, we're trying to get the detail on that answer. Some of the information is quite detailed, so perhaps if the hon. Leader of the Opposition could go on to the next question, we will respond to that shortly. Also, with regard to the earlier point on the backup lands, we would like to arrange a full briefing for the Leader of the Opposition, where staff would give the detail with regard to that question.
F. Gingell: Thank you very much for that offer. If we just go back to the operating transactions, the little grouping above, I understand that in this year's estimates, the amount that's shown as $2,638,482 is the difference between the 1993 estimates and what they actually believe they are going to come out at. That is relatively straightforward. You made some estimates of what you expected the revenues and expenditures to be for this year. You got to the end or the middle of February, and an estimate was made to come out with an estimate of where you'd be at the end of March. You recorded that for us. Fine. But you've also got a proposed adjustment of $9.8 million for '93-94, and that's an unusual item in a special account. Could you explain to me what that $9.8 million is?
Hon. J. Cashore: Hon. Chair, this adjustment is required to reinstate the profit from operations reflected by net revenue calculated on an accrual basis to a cash basis.
F. Gingell: Is the minister saying that the $37 million recorded as revenue is on a cash basis only, and the $9.8 million is the amount of sales proceeds that will be received, but in subsequent years?
Hon. J. Cashore: Hon. Chair, we're getting into some very complex detail here. Again, I think that it would be more productive if somehow we could all sit down in a room, go over these figures together and review it in that way. But this $9.8 million revenue is required on an accrual basis, as an adjustment to bring the account to cash.
F. Gingell: As a matter of fact, I've probably had more briefings on special accounts than any other member of this Legislature, and I thought I understood them. Anyway, if I may just go back, then, to save us some time. My statement was that it is the portion of proceeds that is not to be received in cash this year but is to be received in cash in a future year is the amount that has been added to. Is that what you have said back to me? I believe that it is.
Hon. J. Cashore: Yes, it could be.
F. Gingell: So all of the items that are in the financing transactions, then, are purely and simply cash receipts on sale contracts that have been made in previous years and are now being received in a subsequent year. Is that correct?
Hon. J. Cashore: It's cash that's received in a current year. The revenue could be received in a previous year or a future year.
F. Gingell: Thank you very much. I've got one last question on special accounts. We discussed briefly yesterday the intention in past years to make transfers back to general revenue to get rid of these huge notational balances that have been built up over many years primarily from the sale of Crown land. The question that I asked then was: why were the transfers not made? What was the reason for the discussions between the Crown lands and the Ministry of Finance
[ Page 6753 ]
that caused those transfers not to be made? I would like to suggest to you, in all sincerity, that the response that you made yesterday that was on that briefing note that had been sent to my colleague for Surrey-White Rock is not an answer; that's just repeating the question. The question is: why were the transfers not made?
Hon. J. Cashore: It wasn't made as there was confusion re the appropriate accounting policy. We have received advice from the Ministry of Finance, and those appropriate changes will be made.
F. Gingell: I will just add one more question. The original intention of these special accounts, one would presume -- and I haven't gone back to the original Housing Act of 1973 -- is that revenue coming in from specific sources, like revenue coming in from stumpage and royalties in timber, has sort of been mentally committed to forest industry matters. In this case, one presumes that the intention was that revenues coming in from the sale and various actions relative to Crown land were being saved for and would be used for Crown land type of expenditures and programs. This clearing out of the account -- and reducing it, in effect, to $50 million -- basically says: "This policy that wasn't followed through on in past years is no longer the policy. We recognize that we're not going to spend $474 million on Crown land, but leave us with $50 million so that we do have enough money to make sure our ongoing programs are able to be funded." Is that a fair statement?
Hon. J. Cashore: Yes, that is a fair statement. I'm glad I don't have to repeat it, because the Leader of the Opposition said it well.
Hon. Chair, with regard to another question that was asked earlier about the backup lands lease revenues, the annual gross revenue from Roberts Bank backup lands is approximately $850,000. This has remained consistent for the past few years.
J. Tyabji: I think we're almost finished the general framework for Environment, but we're just finishing off the water section.
I want to ask about a news release that came out on April 15 with regard to the Kootenay Lake fertilization program that the Ministry of Environment is doing in conjunction with B.C. Hydro. I apologize if the staff aren't here for this specific thing, but I wanted to canvass this in general terms.
In the news release, the Minister of Environment, Lands and Parks and B.C. Hydro have committed $450,000 for the second year of the Kootenay Lake fertilization program. This program is a response to the declining level of kokanee that they found in the lakes. Is it standard policy for the Ministry of Environment to solve the declining fish stock problem with a fertilization program, in absence of an investigation into the cause, or would there automatically be an investigation into the cause and an enhancement program as an adjunct?
Hon. J. Cashore: There was an investigation. Every situation we deal with requires its own response because of the unique circumstances. In this case, the biological chain was certainly impacted involving the mysis shrimp, the kokanee and the food chain: and, of course, there was a major consideration with regard to the Gerrard rainbow. Insofar as the question of whether this a matter of policy, it's policy to address challenging concerns in terms of areas like this. That is why this process was followed.
[E. Barnes in the chair.]
Hon. Chair, I would mention that it was our understanding from the consultations that had taken place among House Leaders that we were going to be needing land staff while we wrapped up on the lands part of the considerations. Then we were advised that we would be moving on to parks issues -- we have parks staff standing by -- and then if there were further questions on environmental and wildlife issues, we would conclude with that. We are simply going on the basis of what we understood to be the process.
I know the hon. member asked me to give a general answer, which I can do, but I think it's getting into the area of a question where we do need the specifics.
[4:30]
J. Tyabji: For the minister's information, I was not aware of what the arrangements were with regard to staff, and having seen some of the staff from the general environment estimates earlier today, I just assumed it was more or less open. However, we do have the critic for Lands and Parks with us. I think there's a very limited number of questions that he has left for that part of the debate. I'm hoping that we can get through the general framework for the entire estimates by the end of today; then we can get on to some specific issues and close the estimates fairly soon.
Hon. J. Cashore: Perhaps someone on the opposition benches could advise me when we will no longer require our land staff here. At that time our park staff will come in. If we require further environment staff, they are standing by.
W. Hurd: The opposition doesn't have a great deal more about lands, although I did have a few additional questions on the policy with respect to Crown land use for ski developments in the province. I am specifically asking for information about the Tod Mountain development and the requirement for advertising public meetings in connection with these ski developments. In the case of Tod, can the minister advise us what participation his ministry had in the public meeting process that would have gone into finally awarding a management development agreement to the company? I'm looking down the road into the next fiscal year to determine, in the event that these types of agreements are signed, what type of involvement we can expect from the ministry in providing public information about the sale and/or lease of Crown land
[ Page 6754 ]
which is required to put these kinds of ski hill deals together.
Hon. J. Cashore: Given that this was a sale of an existing entity, the situation is different than it is in the regular policy of dealing with land that's coming into a ski development for the first time. In the area of determining land use with regard to our ski policy, there are processes for involving and consulting the public. When it gets into the negotiation stage, the public are not involved.
W. Hurd: Perhaps I can ask a specific question about the Premier's announcement, which occurred during his trip to Japan. Were staff members available from lands at that announcement, or are we dealing with just a...? Given the fact that that announcement pertained to a Crown land issue and to the ski hill development process in the province, can the minister explain what exactly the Premier was releasing when he was travelling to Tokyo, and whether any assistance was provided for the Premier in addressing any questions that might have come up in connection with this policy? It just seems to the opposition to be a rather curious method of announcing this type of development, given the fact that there were at least a few concerns expressed by the public about the nature of the sale and/or lease of Crown land.
Hon. J. Cashore: A sales agreement was announced between Tod Mountain and Nippon, which had to be approved by the Crown lands branch of this ministry. All of the Crown land negotiations were completed prior to the Premier going on his visit to Japan. No land staff was present, nor was there any reason why they should be, because the appropriate diligence of the Crown lands branch had been applied in every respect to every aspect of this transaction. It is not unusual for a Premier to be involved in making a major announcement about an activity that takes place in any of the ministries or the branches of ministries of government.
W. Hurd: In connection with the Todd Mountain facility, then, the minister is basically saying that the Premier's only involvement in this particular development was to make the announcement in Tokyo, and that his office in no way was involved in any of the discussions with the Japan-Nippon cable company or any other principal who might have been interested in this development. This was strictly in the purview of the Ministry of Environment, Lands and Parks.
Hon. J. Cashore: Hon. Chair, I'm not evading this question; I'm simply stating a fact. If the hon. member wants to ask the Premier what his involvement was, whom he has had conversations with, or who his office has talked to, those are not questions that I am able to answer, and they are not questions that are appropriately put to me. I can answer for the actions of the officials in the Crown lands branch, and I have said and will say again that those officials have carried out all of the required functions in monitoring this transaction. I would also say that it's entirely appropriate for the Premier to be involved in making such an announcement, and I can only speculate that when it comes to making an announcement it would seem to me to be quite reasonable that if the process was being worked out for the time and place of an announcement, that that would seem to me to be quite an understandable conversation to be taking place.
C. Tanner: I want to change the subject with the minister a little bit, but it still concerns Crown lands. Those are the lands that belong to the Crown that are between Vancouver Island and the mainland, and the ocean floor in between. It's my understanding that those lands belong to the Crown and come under the jurisdiction of the minister. Is that correct?
Hon. J. Cashore: Yes.
C. Tanner: The Islands Trust organization is presently putting together a policy which they hope to have in place by September, and part of the policy is consideration of artificial reefs and the dropping of artificial reefs in various parts of Georgia strait. It is my understanding that they have developed a tentative policy which they are going to put before public meetings. I also understand that the minister's department in his Crown lands branch is looking at a policy. Could you tell me how the two are working together?
Hon. J. Cashore: Hon. Chair, I answered this question yesterday in a very full and comprehensive manner, so this issue has been thoroughly canvassed.
C. Tanner: I will read the Blues for that, and I apologize for going over it again. It was my understanding you hadn't, but with the two Houses we sometimes miss these things. Two years ago we did drop a boat, the Church, in a provincial park, and there was one dropped, as you know, in the ocean off Sechelt this year. Did the minister talk about parks as far as artificial reefs are concerned yesterday?
Hon. J. Cashore: No, that is introducing a new aspect to the discussion. We will have park staff in shortly, I understand. But I believe we'll probably find that the question has also been answered, and, for the hon. member's information, we did state that there will be no further artificial reefs until a review of the entire process has been completed to my satisfaction.
C. Tanner: Is the minister aware that in the United States, for example, they have specific legislation for artificial reefs and parks, to protect not only the people who want to dive but also the fish within the artificial reef?
Hon. J. Cashore: Yes, I am aware of that. I'm also aware of the question with regard to marine parks and how it relates to this type of amenity. We are reviewing that.
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W. Hurd: I just want to briefly shift the focus of discussion to tenures that could be offered by the Ministry of Lands for recreational ventures: wilderness experiences and backpacking adventures. Can the minister advise the committee whether in this coming fiscal year the Ministry of Lands will be issuing any tenures to groups or individuals proposing to secure access to Crown land for a period of a fixed lease to provide these types of tourism ventures with some sort of security over Crown land which would be used to facilitate these types of developments?
Hon. J. Cashore: The answer is a tentative yes, based on the completion of the back-country recreation policy, which is addressing this issue. A lot of the details of the very item the hon. member was asking about are in the process of being decided. Once that policy is decided, we believe that we will have in place a fair and appropriate modus operandi for addressing this issue, in the context of recognizing that a multiplicity of issues need to be carefully thought through. So the back-country recreation policy is the vehicle with which the government is coming forward with its decisions on this issue.
W. Hurd: I'm aware of at least one or two proposals that have reached the stage where tenures are close to being granted -- at least that's my understanding. Before those tenures are granted, can the minister advise us whether it's necessary for the applicants to deal with local Indian bands with respect to gaining access or having the tenure approved? Is it the responsibility of the applicants to deal with Aboriginal Affairs issues, or is the ministry actively involved in trying to address some of those problems?
Hon. J. Cashore: We do it, because it's clear that it's part of our fiduciary responsibility.
[4:45]
W. Hurd: So it would not be the responsibility of the applicant for tenure to deal with bands in any way; the ministry would be totally responsibile for addressing any concerns the band might have about the nature of the tenure and the types of developments that might go forward -- whether they be fishing lodges, hunting lodges or any other type of facility. Is he aware that there might be some negotiations going on between some of the tenure-holders and aboriginal people? Or would that not be what they should be doing in this case?
Hon. J. Cashore: The answer is yes, we are aware of that. We have a fiduciary responsibility within the lands branch of the government to ensure that those consultations take place. When it behooves an operator to enter into such consultations, we see that as understandable and, for the most part, positive.
W. Hurd: Given a scenario where those negotiations might break down over the issue of aboriginal title or an aboriginal treaty, would it be the responsibility of the Ministry of Environment, Lands and Parks to mediate that process, or is a more likely scenario that the tenure application would just be put on hold until such time as the Aboriginal Affairs questions were dealt with?
Hon. J. Cashore: The mediation is certainly a viable approach. Where mediation is not successful, government has a responsibility to make a decision. That decision would have to be made taking into consideration all of the factors extant at the time.
W. Hurd: In terms of access to Crown land in the form of a tenure for a wilderness adventure company or a fishing operation or some other type of tourism venture, it wouldn't necessarily be the case that a disagreement with one of the local aboriginal communities would stall the application for tenure. It might be possible for the ministry to mediate any disagreements and grant that tenure. Is that a role that the ministry would engage in in order to bring some of these worthwhile tourism ventures into active management of the province, obviously with a lot of spinoff economic benefits? Would the tenure issue be in any way halted -- thwarted even -- by a disagreement that might exist between the applicant and the local Indian band?
Hon. J. Cashore: It is the responsibility of government to govern, and therefore we have the responsibility to make a decision. In making a decision, we have various options. We can grant the tenure; we can grant the tenure with conditions; we can refuse to grant the tenure. All of those options are part and parcel of the decision that has to be made by the Ministry of Environment, Lands and Parks. In making those decisions, the kinds of issues that the member for Surrey-White Rock is describing are issues that are understandably before us.
W. Hurd: Can the minister advise us then of whether those who are currently applying for tenure and may be close to receiving it and who may be having difficulties coming to an agreement with the local aboriginal people.... Will the ministry, over the shortest possible time, address their tenure applications independent of whatever dispute might be ongoing? Will a decision be rendered that won't be tied up in the broader issue of aboriginal treaties and compensation in the province?
Hon. J. Cashore: Right now things are being tied up not because of those kinds of decisions, but because there is a moratorium in place until we have our policy work done. We realize there is urgency to get that policy concluded and out. As I said before, government still has the responsibility to make a decision in a timely manner, and it has to take all of those factors into consideration.
W. Hurd: I have a final series of questions on Crown lands. It relates to water licence fees and grazing fees, which were recently increased by the government. I understand that responsibility for range land falls
[ Page 6756 ]
within the purview of the Minister of Forests, but could the minister possibly advise the committee of the kind of overlap that exists when you're dealing with the cattlemen's associations? I assume that they make direct application to the Minister of Forests on range fees even though the lands may be Crown lands, or would they make submissions to both ministers with respect to this important issue?
Hon. J. Cashore: It's my understanding that they make their initial application to the Ministry of Forests, but it's also true that we in the Crown land branch do have ongoing discussions with the Cattlemen's Association.
W. Hurd: When it comes to monitoring the effect of wildlife and cattle grazing on the grasslands, am I correct in assuming that that would then be a function of the local office of the Ministry of Environment, Lands and Parks?
Hon. J. Cashore: We rely on the expertise within the Ministry of Forests range division. Since we rely on that, I would say we do have a role in having some input into how to manage the results of that input.
W. Hurd: Can the minister advise how the dates for grazing in the province are arrived at? The opposition has received expressions of concern about some areas of the province which have a heavy moose population, for example, and because of that heavy population the date on which cattle are permitted on the Crown grazing areas is moved back every year. Would that decision be made by the Ministry of Forests or would it be made under the direction of the Ministry of Environment, Lands and Parks?
Hon. J. Cashore: For the most part, that relates to the rangeland, not the grazing leases; being rangeland, it's Ministry of Forests.
W. Hurd: I ask this question on behalf of cattlemen in the Cranbrook area who have been advised that because of the pressure of wildlife on the range, the date for grazing has been moved back to June 1, and may even be later in the season next year. I understand that will put their industry at a severe disadvantage and may render it financially unviable. The people in that area are under the impression that these rules are set by the Ministry of Environment, Lands and Parks, because they relate to the overall effect of grazing of all animals on Crown land. For the benefit of rendering suggestions to those who call, I'm looking for some sort of direction from the minister about who sets the date and who is responsible for determining what level of grazing among all types of wildlife is to be considered.
Hon. J. Cashore: That particular area is dealt with by the East Kootenay Trench agriculture-wildlife committee, which has been in place, I believe, for three years.
W. Hurd: One assumes that's an advisory body. Or does it contain government representation? Fine.
I have one more question about the water rate increases that were levied by the government. I recognize this isn't a Crown land issue, and if the appropriate staff are not here, we could certainly revisit it at a later date. When we were questioning the Minister of Forests about the increase in rangeland fees, he pointed out at that it was based on a market calculation for beef. I wonder if the minister could explain to us whether any such calculation is factored into the rather draconian increases in water rates for the cattle industry. Perhaps he could explain how the water rates were arrived at. I'm sure his ministry is receiving the same letters from the B.C. Cattlemen's Association that the opposition is receiving, pointing out that they can't understand how these rates were arrived at.
Hon. J. Cashore: I believe that we should seek to answer this question when we have environmental protection staff available who are involved in the work of setting those rates. If we're able to, we will get that answer this afternoon; if not, we will get it to the hon. member.
W. Hurd: That virtually concludes the questions that I had as the critic for Lands. Whether, after a short adjournment to provide for the staff being here, we want to deal with Parks issues.... I'm at the direction of the minister.
Hon. J. Cashore: Hon. Chair, I now have Parks staff available in the House. Assistant Deputy Minister Jake Masselink has entered the chamber, so we are ready to proceed with Parks questions.
W. Hurd: One question that we attempted to raise yesterday concerns the transfer of provincial parks to the jurisdiction of regional districts and local governments. With respect to these transfers, the opposition has raised the issue of what will happen to the existing wildlife management plans and the hunting and fishing regulations. One assumes that they also are subject to change by the regional district. Does the ministry retain any control for a period of a few months or years over the regulation this type of activity?
[5:00]
Hon. J. Cashore: It would be the responsibility of the regional district after such a transfer was effected. Wildlife management plans and such would be subject to the decision-making of the new body responsible for that park. In some instances there could be specific requirements spelled out in the transfer of the park to the regional district -- but that rarely happens.
I should just add that we have an enormous responsibility in managing the parklands in B.C. In doing so, there are criteria that we look to with regard to our provincial parks. There are instances where those criteria would suggest that certain parks would be more appropriate as a regional park. Examples would be where housing in a regional district grows up and almost surrounds a park, or the situation where the
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major use of the area is by local rather than provincial residents. When we're able to make those transitions and effect those transactions, we are able to concentrate on doing the good job we are doing in the provincial park system, which, as you know, is expanding.
W. Hurd: Perhaps, then, I can just ask one question about Sooke Mountain Park, which has been raised as being subject to a transfer to the Capital Regional District. I'm sure the minister will have received submissions from wildlife groups, hunters and fishermen, who are concerned about access to that park being denied or reduced by virtue of its transfer to the regional district. Can the minister advise us whether, in his opinion, the transfer of that park to the regional district is predicated on the kinds of points he was making earlier -- being in the middle of a residential area and not suitable, for example, for hunting any longer?
Hon. J. Cashore: No, it is not surrounded by residential development; it's up against water district lands. For the information of the member for Surrey-White Rock, Sooke Mountain Park is the only remaining class B park in the province, outside of the rather unique situation with the class B park in the area of the Westmin mine within Strathcona. Strathcona, as you know, is a class A park that has had its boundaries entrenched in legislation. But there is an anomaly because of the Westmin mine, so the area surrounding the mine is defined as a class B park. Sooke Mountain Park is the only remaining class B park in the province.
W. Hurd: I have a couple of questions about plans for the Cypress Bowl Provincial Park, which I'm sure is another issue that has come to the attention of the ministry in the past year, as it has to me. Can the minister give us a timetable for a decision on the application put forward by the developer and, indeed, on the master concept plan for Cypress Bowl? I'm aware of the hearings that have been held and the considerable controversy the project has engendered. Is there a timetable for a decision on this particular development?
Hon. J. Cashore: Just to go back to the question about Sooke Mountain Park, I want to state for the record that a decision has not yet been rendered on that.
With regard to Cypress, it's difficult to give an exact timetable at this time, because we are awaiting the ombudsman's report, given that questions have been raised regarding administrative fairness in the way the planning process was handled. Until we have that ombudsman's report, we will not be able to proceed with other matters that have to be dealt with along the road to the final decision on the difficult issue of Cypress Park.
W. Hurd: Does the ministry, then, have a policy about how it deals with the transfer of land from a park jurisdiction to some other type of use? I'm familiar with the change that occurred at Red Mountain in the interior, when application was made to transfer lands from a park designation to use for expanding ski facilities. Obviously that means the status of the park has to be changed. Is that correct?
Hon. T. Perry: I seek leave to make a brief introduction.
Leave granted.
Hon. T. Perry: I have met some wonderful kids just now who are in grade 3 at Lord Tennyson Elementary School in the Vancouver-Little Mountain constituency and their teachers, Anne Ptucha and Laurie Linton. I think they're just coming into the House now. They're really delightful kids -- very happy, along with their teachers, to be back in school and having a wonderful time over here in Victoria. I would ask members of the Legislature to make them welcome. In case they're wondering, these are the budget debates on the Minister of Environment's spending.
Hon. J. Cashore: Again, each of these situations is unique to the terrain in which it happens to be located. If it's not of provincial significance, and if it is of regional significance, then we look to a regional body that may wish to negotiate a transfer of that park. But each area is looked at on its own merit.
W. Hurd: When the minister talks about merit, I'm a little confused. Once a park is designated, does he see it as being site-specific when the decision is made to declassify the area as a provincial park -- in other words, to change its usage? I believe that's the concern being expressed in Cypress: once it's redesignated from parkland to a ski hill venture, that in turn reduces or eliminates the other options that are available on parkland. Is the minister telling us that such items as public usage of this area and the types of activities will be monitored and weighed before a decision is made to redesignate it to what is really a more restrictive use?
Hon. J. Cashore: The answer is yes, we will consider access issues when we make the decision.
W. Hurd: Can the minister give us an idea, just for the benefit of the committee, how often this transfer occurs, where land is taken out of a park and designated for other use? Are we dealing with an issue here that is just specific to ski hills, or is it a situation that occurs in the province with any frequency at all?
Hon. J. Cashore: Even where this is considered, it doesn't necessarily have to come out of park status. It happens from time to time. It could happen with regard to a ski operation; it could happen with regard to road access; it could happen with regard to picnic tables. There are those kinds of instances, but it doesn't mean by definition that it comes out of park status.
W. Hurd: I was hoping that we could engage in a more meaningful discussion on this issue, because parks proponents in British Columbia are certainly concerned about the pressure from ski hill
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developments where they abut provincial parks. The precedent being set of changing designation, as the minister I'm sure is aware, is of concern to outdoor groups. I just wonder whether Red Mountain and Cypress are unique problems, or whether we're dealing with any long-term policy initiative here that might cause other developers of ski facilities, where parkland is involved, to bring forward new developments or ideas for expanding ski facilities. Really, we're talking about a limiting of or a reduction in the variety of activity that can be undertaken on the land by recreation groups. I would welcome any indication from the minister that this policy is site-specific to the two areas and does not represent any sort of initiative of the minister.
Hon. J. Cashore: Yes, I would like to affirm that. I think that point is correct. I would clarify, however, that a portion of Cypress Park was not sold; facilities were sold. That was the action of a former government. This government did not do that. This government is now dealing with some of the obvious fallout of that decision with the park use question, as we have to make decisions that will be forthcoming.
With regard to Red Mountain, we were dealing there not with a class A, B or C park but with a recreation area where there were mineral tenures. In that case, it was an area of questionable significance. I don't think the transition that took place with regard to Red Mountain was seen as contentious, certainly not by the mail that I received. I think it was generally a well-accepted decision.
W. Hurd: I really have no additional questions on parks. I understand that the Environment critic wishes to canvass a few more issues today before adjournment. Whether we adjourn for a few minutes to get those staff here or whether we just continue with debate, I welcome direction from the minister.
Hon. J. Cashore: We're now arranging for Environment staff to come into the chamber. They'll be here very shortly.
[5:15]
J. Tyabji: Just a general question to the minister while we're waiting for the staff. I'm a little unclear as to the recommendations to government that Stephen Owen brought out with regard to Clayoquot Sound. Which area of the Ministry of Environment would that fall under, specifically the recommendations on staffing for the planning and monitoring of the sound?
Hon. J. Cashore: The answer is regional operations of the Ministry of Environment, Lands and Parks, but it would be the Environment part of regional operations out of the Nanaimo office.
J. Tyabji: That's reassuring, because I was wondering if we had to canvass that under Lands and Parks.
I have one issue-related question with regard to wildlife management. It's a wildlife management issue, but some of the wildlife is on Crown lands, and there's urban encroachment on the Crown lands. I'm assuming that we can canvass that under the general Environment debate.
Hon. J. Cashore: Yes, we have staff here now who can assist me with that line of questioning.
J. Tyabji: Before we went back into the Lands and Parks section -- and I do apologize for however that confusion arose; I think the schedule today has been a little bit interrupted -- we were talking about the fertilization program that the Minister of Environment has in Kootenay Lake. The question I have is: how does a lake like Kootenay Lake get classified as a fertilization project? What is the basis for that? As the minister has confirmed that an investigation is done first into the declining fish stocks before the fertilization, is there any attempt when the problem is sourced to solve the problem and not go into a fertilization program -- i.e., is a fertilization program the last resort?
Hon. J. Cashore: There were scientific experts who were called in to assess the situation, and they advised us that in their opinion, and as a result of their research, the problem was a lack of nutrients and the solution was the application of fertilizer. It's not really a question we can answer as a matter of policy, because this is such a rare occurrence, but I would have to say in all candour that there's no guarantee it's going to work. Preliminary indications are that it is working and that there is improvement, but it was an effort to deal with a very difficult situation. As I said earlier, the Gerrard trout, which are certainly very, very famous, were going into a very serious decline.
J. Tyabji: I appreciate that it's always a difficult situation when one is faced with depleting wildlife resources. But as the minister says, the problem was a lack of nutrients. Then the natural question is: what was causing the lack of nutrients -- i.e., what was it that was interfering with the ecosystem that caused the fish to be in such low numbers in the first place? I'm asking because -- if the minister is aware -- according to the chaos principle and how science is now applying that in terms of fractals and the inability to predict what happens when we intervene in nature, it could end up that in the short term a fertilization project would be successful, but in the long term a disaster. I'm just wondering what safeguards are built into something like that to prevent a future problem?
Hon. J. Cashore: It's a good question as to cause. We don't have an answer. We know that there's an artificial structure there that's quite significant: the Libby Dam. When you have a dam in an ecosystem, it stands to reason that you can at least speculate that that would be the cause of the problem. But we don't have definitive proof in scientific terms whereby we can say that that is the problem. What we do have proof of in scientific terms is that there is a nutrient problem there, and we realized that this was perhaps our last
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opportunity to do something about it, so we thought we'd better act.
J. Tyabji: Lake Koocanusa and Williston Lake are two other areas where there has been massive man-made interference with the natural process. With B.C. Hydro's plans with regard to Lake Koocanusa for the summer and the potential impact on fish stocks, will there also be a reaction by the Ministry of Environment to that if it is found that there is a dramatic change in the fish stocks?
Hon. J. Cashore: To go back to Kootenay Lake just for a moment, Hydro is putting $350,000 into that project.
With regard to Koocanusa and Williston, should similar types of occurrence be recorded, there would be a cooperative approach between the Ministry of Environment, Lands and Parks and B.C. Hydro to address the mitigation issue.
J. Tyabji: One general question I would like to ask the minister is with regard to his own personal information on Williston Lake. I travelled up to Williston Lake last summer and was quite over-whelmed by what has been done up there, in terms of what a dramatic change there is. When you look at what is basically a man-made inland sea at the junction of what used to be the two rivers and when you see the siltation in the lake -- the fact that in the winter you have a 70-foot drop on the shorelines and you have existing snags there.... Are there any ongoing studies by the Ministry of Environment into the environmental impact or the new ecosystem? If you talk to people who have lived at Williston Lake for some time, they're talking about local climatic changes. There has been a dramatic change because of the large increase in surface area that the water is covering. I'm just wondering if the Minister of Environment is monitoring it in terms of weather patterns, fish restocking or the effects of the siltation on the downstream water system which is feeding through the Peace River into Alberta.
Hon. J. Cashore: The answer is no, we are not conducting any studies on that at the present time. Again, should there be indications that there's an issue to be addressed there, it would be done in consultation between B.C. Hydro and B.C. Environment.
J. Tyabji: How would the Minister of Environment know that there is a concern there? Would it be because someone who lives there brings it to the minister's attention? Is there some mechanism that would bring it to the minister's attention, or does it fall to the public to bring it to his attention?
Secondly, has the Minister of Environment ever been to Williston Lake or flown over that area to see how the landscape has been impacted?
Hon. J. Cashore: In 1987 I had the privilege of travelling to Williston Lake with the person who is now the Minister of Government Services. We landed in Ingenika, had what I felt was significant input into addressing some of the living conditions there, and travelled to Fort Ware. I'm very familiar with the points that the hon. member is making. I am aware that prior to Williston Lake there was a very viable commercial transportation industry operated out of Fort Ware, and the construction of the dam resulted in a change of way of life for many people.
We are doing some downstream work on the Peace that involves a relationship that includes B.C. Environment, B.C. Hydro and the government of Alberta with respect to monitoring downstream effects of the Williston Lake Bennett Dam. Given the vastness of this province and the fact that our greatest concentration of population is in the lower mainland, I would say that our first line of defence in an early alert with regard to an environmental concern is the fact that out there on the land are aboriginal people, trappers, hunters and people who are out there enjoying wildlife. These people are very often the first to bring to our attention a situation which then needs to be followed up.
J. Tyabji: For the record, I would like to say that I find that a little bit alarming. I don't put the fault for that at this minister's feet, because I understand that he inherited a system that had been developing over 25 years. It seems to me that when there is such massive human-initiated intervention in the environment as we've had throughout the water systems of our province, we should have some automatic monitoring of the impact on the environment that existed before we put the dams there. Anyone who looks at a map of the province and sees how the waterways go will realize that there are some areas of the province where there has been massive intervention and almost no population. Where there is population, they might not realize that it's incumbent upon them to raise the concern. So I'd like to register that concern.
I think that there might be a better way of doing it, even if it meant passing it to the municipalities and regional districts and getting their groups aware that monitoring would fall generally to the people of the province. There's nothing wrong with that system, provided people realize that that's how the monitoring comes about.
I wasn't sure if the minister already gave me the answer to this, but Lake Koocanusa.... My understanding is that B.C. Hydro is planning an enormous release of water south of the border that will reduce the lake levels to such an extent -- the purpose is to flush the fish fry south of the border, further down the water system in the United States -- that the impact on Canada's water system will be significant and the fish on our side of the dam will be severely and negatively impacted. When B.C. Hydro is planning something like that, to what extent is the Ministry of Environment involved in the process before the action takes place?
Hon. J. Cashore: We have a relationship with B.C. Hydro in which we are informed of their plans. There is an aspect of this question that obviously deals with other ministers and an international aspect of this that involves those international connections as well.
[5:30]
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J. Tyabji: I'd like to find out from the minister, if he could just walk me through the process: in the event that B.C. Hydro had a plan to send, say, a million acre-feet south of the border in excess of what they were doing before -- for example, through Lake Koocanusa -- at what stage would the Ministry of Environment be notified of that? Would there be an environmental impact study automatically commissioned? Who would judge if it was necessary? If one were ordered and this didn't "make" the environmental impact study, what would be the process for preventing it from happening? I think there's a real problem that we're going to face in the Kootenays.
Hon. J. Cashore: Hydro is committed to notifying us and also the Ministry of Energy in such an event. There are limitations under the Columbia River Treaty that also obtain in this regard.
J. Tyabji: My question is actually with regard to an environmental impact study. Is there a mechanism that automatically kicks in if B.C. Hydro or another government agency or ministry is going to do something that would potentially have a serious environmental impact? Is there an automatic environmental impact study undertaken? If it fails the environmental impact study, does the Ministry of Environment have the authority to prevent that action from taking place?
Hon. J. Cashore: The question of environmental impact study is dealt with as the need arises. It's not automatic; it's based on specific circumstances. We are bringing in legislation very shortly with regard to environmental assessment, and aspects of the issue are going to be dealt with in that context.
J. Tyabji: I'd like to move on to PCBs. If you review last year's Hansard you'll see that we're actually going in very much the same way we did last year, except that occasionally I'll refer to the state-of-the-environment report. Last year we talked a little about some of the contaminants. I know that Bill 26 is before the House, so I won't be asking any specifics about contaminated sites. But one thing that isn't addressed in Bill 26 -- at least I don't see it coming up -- and one thing that I would really like to canvass the minister on is whether or not an inventory of existing storage sites for PCBs will be provided and whether or not there is a strategic plan in place to dispose of the PCBs and where it would be done.
Hon. J. Cashore: There is an inventory of existing storage sites. It's always being updated.
With regard to the second part of the question, that issue is being dealt with in consultation between the minister, the toxics reduction branch of the ministry and the commissioner, Dorothy Caddell.
J. Tyabji: I assume that we'll be waiting for the final report of the waste reduction commissioner to find out about the disposal of PCBs.
The state-of-the-environment report talks about residual levels of PCBs in marine life. Of course, we're just assuming that PCBs, like dioxins, are getting into the general ecosystem. Is the Minister of Environment conducting some monitoring process of the marine environment to check on that? I see that the report makes reference to primary sources. But is there some kind of strategic plan for the future, so that when the waste reduction commissioner reports out and when we start...? I'm assuming that a strategy will be in place at that point to start eliminating the PCBs that are currently in storage. Is there going to be some kind of regular monitoring of the environment, not only of what exists but so that we can start bringing marine environment levels down?
Hon. J. Cashore: Generally the federal government has the resources to deal with marine environment analysis, but obviously we're interested in that. We certainly have responsibility for dealing with liquid waste plans. I realize the hon. member put her question in the context of PCBs, but in listening to the question I think it was somewhat more broadly canvassed. The context in which we are formally addressing that is primarily through the development of liquid waste plans in consultation with the regional districts. There is also the monitoring the government does with regard to industry, wherever it may be located within the province. So dealing with the point sources is another aspect of that.
J. Tyabji: I'd like to move off the water issue for now, in recognition that when we.... The most important issue under the heading of water is going to be water sovereignty and the potential diversion of our water resources. But we're going to have to wait for the final draft of the discussion paper before we get to that. For the record, I want to say that's why I haven't spent a lot of time on that, because I know we've got the discussion paper out. To me, that is going to be the biggest environmental issue that we face in the next ten years in B.C.
I am not going to spend any time on the biodiversity section of the state-of-the-environment report, because we still have the protected-areas strategy to report out. So we won't really know what the parameters are to deal with biodiversity until we hear from the protected-areas strategy. So I'd like to move to the land section of the state-of-the-environment report and deal with one question in particular. After that, the Agriculture critic will be talking at some length about pesticides.
I find it interesting that in the land section of the state-of-the-environment report the first question is: who governs the land? This is the question we started off with in the Environment estimates. I wanted to know if there was a plan under way. Has the Minister of Environment started to plan? I know that we're waiting for the report from the waste commissioner as far as the strategic plan for how we deal with our waste and what we want to do with it is concerned. I know that we have the Treaty Commission under way to discuss where the lines will be drawn with regard to aboriginal lands. But what will be the mechanism for dealing with waste management on aboriginal lands? Is that something that will still be under the purview of the Minister of
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Environment? I'm asking because we know automatically that legislation in this House to deal with waste management on Crown lands comes out of this ministry. What will be done with aboriginal lands?
Hon. J. Cashore: It's an important issue; it's part and parcel of the negotiations that take place between the government, through the Ministry of Aboriginal Affairs, and the first nations in the treaty-making process. It's future policy, but it is policy that relies very heavily on the negotiations between the first nations and government.
J. Tyabji: This is a very difficult issue to canvass, because there are so many ministries and levels of government involved, but the baseline question that I'm trying to ask is: is there some comfort that when we deal with waste management in the provincial legislature, on lands that are currently designated Crown lands, the legislation will still apply, even when the jurisdiction passes to the aboriginal people?
Hon. J. Cashore: That all depends on the outcome of those negotiations, but Environment will be very much involved in those aspects of those negotiations.
J. Tyabji: Am I to understand that the Minister of Environment will still be directing some of the waste management discussions, within British Columbia, under aboriginal jurisdiction?
Hon. J. Cashore: No. I would like the hon. member to understand that the answer to the question will come out of the negotiations. During the negotiations, the Ministry of Environment, Lands and Parks will have a major role in participating in those discussions.
J. Tyabji: Will the major role of the Minister of Environment in the discussions with the aboriginal people be to direct their policy with regard to environment internally, or will it try to coordinate their administration with what is being done right now? I'm asking that because there have been a number of issues which have come under federal, provincial and aboriginal jurisdiction. For example, with waste incinerators, the federal laws -- and I understand I'm just giving you an example on the federal level -- would not allow their location on non-aboriginal land, but it would be allowed on aboriginal land; yet we recognize that the airshed is still the same airshed. So when we have waste management issues passed through this House, particularly as we deal with waste water, is there some comfort that the same dioxin emission levels that apply to pulp mills on non-aboriginal land will apply to pulp mills on aboriginal land? Where does that jurisdiction get negotiated? Is the minister telling me that the jurisdiction for dioxin emissions may end up 100 percent with the aboriginal people, and that he doesn't know because all of those negotiations will be done by a different ministry?
Hon. J. Cashore: The province approaches treaty negotiations upholding the provincial interest. How that aspect is worked out between the province and aboriginal interests is subject to those discussions. The Ministry of Environment, Lands and Parks has a major role in ensuring that through that process the provincial interest is appropriately maintained. I say "appropriately maintained," recognizing that it's in the mutual interest of all parties involved in these negotiations to have a healthy environment. We are there making sure that the provincial interest is maintained. But it is not possible to answer those parts of the hon. member's question that seek a description of exactly what things will look like after those negotiations take place. I could speculate on that, but I won't. I am confident in the process, however, and I am confident that it will produce an appropriate result.
J. Tyabji: Flipping to the other side of the coin, we currently have an issue before us with regard to the Nechako River diversion that affects the Cheslatta Indian band on the Cheslatta reserve near the Nechako valley. I'm sure that the minister is aware that issue hasn't gone away. I have received quite a lot of information on the potential impact of the Kemano 2 completion. I know the Minister of Environment commissioned an environmental impact study just a few months ago. I wonder if the minister is in the process of discussions with the Cheslatta on the Nechako River.
Hon. J. Cashore: I met with the Cheslatta people on site in September. This was prior to our January announcement of the review to be conducted through the B.C. Utilities Commission. Given that the review is now launched, it is not correct for me to be in consultation with the component groups in any other way than on behalf of the government. Neither I nor my colleagues, such as the Minster of Energy, who has responsibility for the Utilities Commission, should be involved in discussions pertaining to the clarification of the meaning of the eight terms of reference put in place at the time we announced the commission. I am very familiar with the points that have been made by the Cheslatta. I have consulted with them. I met with them here in my office in Victoria, along with other ministers, prior to the launching of the commission. I recognize that there are very significant questions coming out of their concerns.
J. Tyabji: About half an hour ago I was talking about the after-effects of hydroelectric projects and the monitoring that should be in place. The minister has advised the House that there is no automatic mechanism for monitoring the potential ecosystem impact of a hydroelectric project. Has the ministry conducted any studies with regard to the salmon run, as it has been put forth by the fisheries associations? I know that a lot of lobbying has been done with regard to the Fraser River sockeye salmon run. A claim is being made by some of the fisheries that 50 percent of the run will be affected by temperature changes, with the diversion of the Nechako River. To what extent is that
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going to weigh on the review? To what extent is the minister prepared to look into the ecosystem impact of the Nechako River diversion?
C. Evans: Could I ask leave to make an introduction?
Leave granted.
C. Evans: Hon. members, you will remember that on the day the Legislature opened, there was a group of people here concerned about environmental matters, and there was quite a disturbance. The disturbance has led young people in Victoria to feel that they have gotten a bit of a bad rap. A group of people is here today to say that they too are very concerned about the environment but wish to make that expression in a peaceful way.
[5:45]
They have asked me to introduced them by saying the following things. They are called GRYFIN, which means Group Representing Youth's Future Interests Now. They believe that they are the youth advocates of Vancouver Island. They are here to address the systemic violence in our society and to say that all violence stems from our society and the policies of the society that allow violence. They are here to ask us to listen.
Several MLAs, including the Environment critic and the Minister of Women's Equality, met with them outside. I invited them in to see, so that young people could see that they were welcome in these halls, and could come in safely to hear the debates about Environment. Minister of Environment and critic, please make them welcome.
Hon. J. Cashore: I would like to join in that welcome, and to say that hearing the values that are implicit within the basis of the formation of this organization, GRYFIN, that I take great hope in that. I would think I speak for all members of the House in affirming that we welcome, and we should welcome, the lively critique that comes from young people, especially when it's in the context of their concern for the future of the planet, and for our responsibility in a part of the planet where only slightly more than three million people occupy a land the size of Germany, Switzerland and France. We have a tremendous opportunity in this province, and I am very encouraged that among our young people are those who are going to provide the kind of ferment and discussion and critique that will certainly ensure that those of us who have the privilege of being in this House will be cognizant of the issues that they are so concerned about as they look to the future and seek to care about that future. So I'm very glad that you've been able to come here.
With regard to the last question the hon. member asked, the response is in the context of the work that's being done by the Utilities Commission. The Utilities Commission has completed its scope hearings, in which several presentations were made by the various parties who have a interest in the future of that project. They are now in the process of deciding on the dates, as the commission gets to the further work of its actual hearings. Questions raising issues with regard to the need for impact studies and various types of review would be the appropriate subject of that commission. For me to comment on that now would preclude that process.
J. Tyabji: I know that we're nearing the end of the day's debates, but I want to say for the record that I understand that it was difficult for this minister to deal with the Nechako River diversion proposal, in that it had been initiated by the Social Credit government. However, when this minister was the Environment critic and shortly after he became the Minister of Environment, he spent a lot of time talking about the web of life and fragile ecosystems and the need to preserve the environment. I have before me an enormous submission from not only the Cheslatta band, but also the Commercial Fishing Industry Council, the Northern Trollers' Association, the Lower Fraser Fishing Authority and basically anybody who lives in that area. There's the Rivers Defence Coalition and the environmental groups in Prince George. Without exception, all of them are saying that the Nechako River diversion is going to have a dramatic environmental impact.
I know that a lot of money has been spent on Kemano 2, but I have great difficulty with the fact that in this last hour we've canvassed that there is no automatic mechanism to monitor ecosystems once a hydroelectric project has been put in place. I think that's a big problem. Even if we can't stop Kemano 2 -- and I'm not sure that we can't -- even if we accept that it's something the Social Credit government started and it's past the point of completion, surely we can prevent it from happening in the future. I'm not talking about necessarily legislating a fail-safe environmental assessment before it happens, but we have hydroelectric projects throughout the province that have led to the damming of major waterways. Large reservoirs have formed and there are downstream problems. We know that there's growing pressure from the south for water exports and diversion of our internal waterways to the United States.
There must be some strategy from the Ministry of Environment to prevent ecosystem destruction. It's ironic that at the same time as the protected-areas strategy and CORE are trying to set aside representative ecosystems on our land base, our waterways are being virtually neglected. The Utilities Commission, B.C. Hydro and West Kootenay Power are in charge of our water resources. I think there's a problem with that. We'll have to wait until the next sitting, but when we get into the specific issues, I also want to talk about the water legislation and the fact that we make no allowance for the natural users of the water, which are the fish and wildlife within it. In this context, is there any discussion right now within the Ministry of Environment to prevent ecosystem damage after projects like Kemano 2?
Hon. J. Cashore: I've already answered this question. The fact is that this will not happen in the future. It cannot happen in the future. It's future policy.
[ Page 6763 ]
There's legislation to be introduced into this House very soon that.... Our environmental assessment bill will be dealing with virtually every point the hon. member has just raised. Once this legislation is in place, it will not be possible to have the type of circumstance that would create a major project such as Kemano without an appropriate, extensive, fair and inclusive environmental review. You will see that, hon. member, when you see the nature of the legislation to be introduced. There is no question that this government is taking every aspect of every point that the hon. member just made with grave seriousness -- and more so.
The hon. member asked if there is a program. Is there a program! A very extensive legislative framework will be coming down that will ensure that this is addressed appropriately.
J. Tyabji: My understanding from the previous discussions we've had today was that although -- and I know that there's going to be comprehensive water legislation coming out.... We've heard a lot about that coming attraction to be expected before the B.C. Legislature. I am trying to get from the minister whether there is going to be provision in that water legislation for monitoring our fish and the habitat, outside of the general public? We just finished talking about how, in the current system, it's more or less incumbent on the public to bring to the minister's attention serious depletion of fish stocks. When we have major hydroelectric intervention in the waterways and the ecosystems, there should be a monitoring process in place. The minister has said there isn't. We know there is water legislation coming to prevent a future Kemano 2, but I'm talking about the after-effects of Kemano 2, Williston Lake and Lake Koocanusa. I could go on and on. I congratulate the minister ahead of time for his water legislation, which I greatly anticipate. If it contains all the things that he mentioned, I'll be the first to congratulate him. But will there be a monitoring system to check on the places where we've put major hydroelectric projects?
Hon. J. Cashore: I want to assure the hon. member and members of the House that we have extensive monitoring procedures within government. This government has made a quantum leap in the numbers of conservation officers who are able to assist the province in monitoring and enforcing a variety of situations that deal with wildlife and pollution throughout the province.
But this government and this ministry recognize that in a province as vast as British Columbia, it's very important to recognize the value of partnerships with those people who are on the land and are often the first ones to notice something. That is not something that should in any way be criticized as being willy-nilly or by happenstance. The fact is that we have very vigilant pilots who are flying and criss-crossing this province all the time, and they are observing and reporting when it behooves them to do so. We have hunters and fishers on the land who observe and report when it behooves them to do so. We have trappers, guide-outfitters and people who are on the land. Indeed, hon. Chair, we have MLAs who are out there on the land when they are able to be out, and they have a network of offices to which people report their concerns. These concerns are reported. That is not to suggest for one moment that we do not need appropriate methods and procedures for monitoring with all of these things.
The hon. member has mentioned future policy with regard to water. I have mentioned legislation with regard to environmental assessment. There are a wide variety of initiatives coming forth from this government which are enabling this province to catch up with regard to a number of urgent and pressing matters so that we can ensure the appropriate future for environmental quality for our children.
With that, hon. Chair, I would move that the committee rise, report progress and ask leave to sit again.
Motion approved.
The House resumed; the Speaker in the chair.
Committee of Supply B, having reported resolutions, was granted leave to sit again.
Committee of Supply A, having reported progress, was granted leave to sit again.
Hon. R. Blencoe: Hon. Speaker, before we adjourn -- and I wish everybody a pleasant evening -- I would like to notify the House that we will sit tomorrow.
Hon. R. Blencoe moved adjournment of the House.
Motion approved.
The House adjourned at 5:58 p.m
The House in Committee of Supply A; D. Lovick in the chair.
The Committee met at 2:54 p.m.
ESTIMATES: MINISTRY OF TRANSPORTATION AND HIGHWAYS
On vote 58: minister's office, $410,000.
Hon. A. Charbonneau: In opening the estimates, given the fiscal situation in the province, we all know that decisions have been taken, which I agree with, to protect education, health care and social services -- the social safety net. Of necessity, several ministries -- my own included -- have to live on a fairly tight budget in the coming year. As I've said, I believe that is reasonable, considering the budgetary condition and the desire of this government to get the deficit under control.
[ Page 6764 ]
With my engineering background, I am fully cognizant of the state of transportation not only in our province but across the country. There has been chronic underfunding in transportation for at least a generation. In this period we have turned our attention to efficiencies, to maintaining the level of standards expected in the maintenance and operation of highways and to protecting to the maximum degree possible the rehabilitation portion of my budget -- yielding where we need to on the capital investment side.
As I said, there has been underfunding in transportation not only in British Columbia but across North America. I have been speaking up since taking office and saying that the way to resolve that would be through capitalization of new highway construction. This approach has been pursued by this government in Bill 3 this year, through the establishment of a Transportation Financing Authority, in order that we can get on with the very real job of solving the transportation needs of the province. Those needs are many. The Premier has charged me with preparing, over the summer, a province-wide strategic plan in transportation that will look ahead five or ten years to determine what our priorities should be. I will be doing that with the Transportation Financing Authority in mind.
It has become clear to me that the only way we will solve the transportation problem is by adopting, to a substantial degree, a user-pay philosophy. The Transportation Financing Authority permits this and establishes the basis for this in law. It has enabled me this year to expend some $85 million, based on financing arrangements made through a 1-cent-a-litre tax on fuel and a $1.50-a-day tax on rental cars. At some point in the near future I will be releasing details of our planned expenditures under B.C. 21 within the authority of the Financing Authority -- the details of projects for that $85 million.
[3:00]
Looking around the province, the large-dollar transportation problems tend to be in the lower mainland and on the Island. The needs of the Island have been put first and foremost on the agenda of Transportation at this time. The Island Highway has been talked about for a generation, but relatively little has actually been accomplished. We intend to start correcting that this year.
Around the rest of the province, solving the so-called gateway problem in Vancouver has to take a very high priority as well. One can move all around the metropolitan area identifying transportation needs: the completion of the four-laning and interchanges on the Trans-Canada Highway; the replacement or rehabilitation of the Lions Gate Bridge; the expansion in capacity of the Second Narrows; a bridge across Pitt River; an additional crossing of the Fraser -- or perhaps even two -- in the next ten years; the expansion of the Port Mann Bridge; the expansion of the Trans-Canada all the way in from Langley; a port or perimeter road through Surrey and Delta; some better road on the North Shore connecting port facilities in North Vancouver as well; a proper road system into the northeast suburbs of Vancouver; the completion of the north end works started on the Alex Fraser Bridge; the expansion of capacity at the Deas Island Tunnel; the realignment of part of Highway 17; the establishment of some kind of road with substantial capacity generally paralleling the American border to take stress off the Trans-Canada. All of that must be done in conjunction with proper planning for transit, B.C. Ferries, a new airport authority and the railways. That kind of work is underway now, and it will be ongoing through the summer under the strategic plan I am preparing.
However, we cannot forget the rest of the province in this process. I've mentioned the Island and the very real needs there. We certainly have very real needs along many components of what could be established as a national highways system, and we are in negotiations with the federal government to establish a national highways policy, which would include the definition of a national highways system. There was agreement of all jurisdictions on what that national highways system network should look like. In British Columbia, for example, it included the Trans-Canada, the Yellowhead Trans-Canada, the southern transprovincial, Highway 99, Highway 97, Highway 5 and several others. They form a good network of roads across British Columbia, and there are very real needs on all those roads.
We hold ourselves out to the world as a major industrial power -- one of the G-7 -- yet we don't even have a four-lane highway across the province. The congestion and associated danger that occurs on the two-lane portions of the Trans-Canada is unacceptable, as is the choking of commerce, business and transportation. As we all know, when we look at the position of B.C. in the world marketplace, we find that a good portion -- as high as 40 percent -- of the selling price of our product is transportation costs. Any efficiencies we can effect in the transportation system will go right to the bottom line, make our goods more attractive internationally and hence give us the necessary economic competitive advantage we need. That in turn will spur ongoing economic development.
On all of these roads through the province that I mentioned, we have capacity constraints, volume constraints, safety constraints and safety problems. Highway 97 down the Okanagan is a particular problem. We need to resolve some of those problems. We need to make safety improvements on elements of the Yellowhead Trans-Canada. We are doing some improvements this year on connections into the northeast part of the province -- all of them. We will not forget the rest of the province in coming up with this strategic plan and in looking at what can be done under Bill 3.
Coming back to the lower mainland, I want to stress again the need to have a comprehensive solution that includes transit to a very large measure: high-occupancy-vehicle lanes, queue jumping arrangements, perhaps busways and, in addition to that, of course, the possibility of major expansion in the rapid transit system. The transportation problem in the lower mainland cannot be solved by simply running eight, ten or 12 lanes of concrete into Vancouver; we all know that. We will be working closely with the Minister of Finance on those elements of the plan that involve B.C. Transit.
[ Page 6765 ]
It is proposed through Bill 3 that the necessary funds be derived from tolls or dedicated taxes, and I would point out at the beginning that the citizens of British Columbia are paying enormous tolls now. They're paying the toll in lost personal and family time, as they sit in traffic jams for 20 minutes, a half-hour or sometimes an hour on the way to work. They are paying a toll environmentally with the stop-and-go driving and idling in traffic for God knows how many millions of vehicle-hours each year. We are all paying a toll in the cost of commercial goods as our commercial vehicles are tied up in traffic jams, and in the loss of productivity and of benefits due to capital equipment being tied up. That applies not only to the road system but to our rail system as well. So we are all paying enormous tolls. We are paying a toll of safety. We're paying a toll of deaths and injuries in accidents. We're paying very large tolls in our medical and ICBC systems. We intend to make reasonable improvements of the highway system based on a user-pay philosophy that will replace all the tolls that I have mentioned with a much more modest toll of perhaps a dollar to cross a newly expanded bridge, a new tunnel or a new piece of freeway. I think we will save a great deal of the other tolls and a great deal of money in the long run. We will make our economy more competitive to boot and realize the benefits from that as well.
There must be a modest start on this. One cannot jump to full-bore major highways initiatives from a standing or near-standing start; we propose about $85 million this year. Through these strategic plans I propose to expand that rate of expenditure and to coordinate closely those rates of expenditures with suitable expenditures in transit, ferries and other sectors of transportation. In the meantime, our top priority will be keeping the system we have now in the best and safest condition possible.
D. Symons: I thank the minister for that outline of the goals and concerns of the ministry for the coming year. He has covered much of what I would have liked to have said during that opening remark, so I'll keep my remarks rather brief. I share many of the interests and concerns that he expressed.
Although cuts in the Ministry of Transportation and Highways may be necessary to adequately fund health care, social services and education, I think that adequate funding in highways is necessary to maintain the infrastructure we currently have. Past studies have shown that somewhere in the neighbourhood of $250 million a year should be spent on rehabilitation in order to maintain the current level of infrastructure in A-1 shape. The ministry's spending on that may be considerably below that level. We'll get into that further when we get into the various votes.
Even though education, health and social services are important, we cannot totally ignore the needs of the highway system in the province. As the minister mentioned, good operating transportation systems are necessary for the economy of the province. That is another reason why we can't put off for another day what has to be done today.
The minister mentioned the methods of capitalization and the importance of Bill 3. We seem to be putting together a strategic plan for the province. The Delcan study done more than five years ago was a pretty good blueprint for a strategic plan. Possibly that could be dusted off and updated. When we fit that in with the 2021 study being done in the Greater Vancouver Regional District, those two things will give us a good idea of what really needs to be done in the province in the next few years. I hope the minister doesn't spend too much time on the strategic plan, because a great deal of that groundwork has already been done; we don't have to revisit or spend a lot of time on that. We've had studies for quite a few years now. I think it's time those studies move into some concrete decisions on actions to be taken.
You said $85 million is going to be raised this year through Bill 3 provisions for a 1-cent-a-litre gas tax and the $1.50-per-day car rental tax. However, I think it's going to need more than that to address the problems. As you mentioned, there are many projects that need doing. I hope you will be releasing the details soon on where that $85 million will be spent for this fiscal year, because many projects around the province, which must be done for safety, for the convenience of travellers and the economic betterment of this province, have been delayed for too many years.
[3:15]
You mentioned the big-ticket items on the lower mainland and on Vancouver Island. There's no doubt in my mind that those are the areas of most critical concern in the province. As you mentioned, it's certainly going to be necessary for the economic welfare of the lower mainland that this gateway city have proper transportation modes for the goods going to and from Vancouver -- our port city and hub city. We're going to have to do something about those particular issues in the greater Vancouver area.
I was waiting for it to come in, so I'm glad you also mentioned working in conjunction with proper transit. As you said, a great deal of the answer is not going to lie in creating more roads and bridges. Again, particularly in the lower mainland, we pretty well have to double those to handle the increase that will happen in traffic over the next 25 years. Simply adding more lanes will not solve the problem. I think transit is something we must begin to address almost immediately. Alternatives must be there for people to use, which should be in place before we start using the stick of tolls and all the other methods we might use to discourage people from using their vehicles. I believe that the carrot should somehow be there before the stick.
The national highways system is something else the minister touched on, and certainly that has been a long time coming. I'm pleased to hear that there is some progress on that. I would like to see some progress on funding a national highways system through the federal government, because I believe we currently get next to nothing from the federal government in contributions toward highways in British Columbia -- be it the Trans-Canada Highway or any other highway. The federal government takes a fair amount in fuel taxes out of the province, and I would like to see some of that
[ Page 6766 ]
money dedicated to coming back to the province of origin. I believe that's one thing we could push the federal government very hard to do. At least the money -- or, as I said, a good portion of it -- would be spent on a national highways system in the province where that money was collected. Poorer provinces probably would need some of that money to assist them in their case, but a 50 percent return of federal moneys collected here would be a good start.
I note also that you mentioned problems developing with volume and safety, particularly in the lower mainland on Highway 97 and the Yellowhead. Those two are interests of mine. Many improvements are needed. You commented about the user-pay philosophy, and I have some difficulty with that. Again, you did mention concerns with the current tolls that people are paying with the use of highways in the extra costs of goods because of delays, the fuel, the environment and all the other usages of the roads because of the current holdups. Again, if we start addressing the issues of rapid transit, I believe that will somehow alleviate some problems to begin with and give the trucks more opportunity to move more quickly on the highways.
Also, I believe strongly that we should be investigating, and maybe should have already installed, more high-occupancy-vehicle lanes. We don't have those on Highway 99 through my riding, and I think that could be achieved on Highway 99 into Richmond. We could also put in a high-occupancy-vehicle lane almost immediately on Highway 1. Those should include bus lanes; we have a bus lane through Highway 99 that could be expanded. Not that many buses travel it, so it would be possible to integrate high-occupancy-vehicles and trucks that can maintain speed on those particular lanes. That would help commerce move a little faster in the province.
With those opening remarks, I would like move onto the actual estimates themselves, and I'm not sure whether I introduce that topic or whether the minister responds. So I will take my seat for a moment and see if there is any response or any comments others would like to make, and at that point we will move into the estimates.
The Chair: Mr. Minister, would you care to respond in general terms and perhaps clarify how we are going to deal with the particular subvotes?
Hon. A. Charbonneau: As a general response to some of the questions, first I should make it clear that we don't intend to reinvent the wheel with respect to studies that are out there now. We're funding half of the Transport 2021 study and looking forward to receiving technical recommendations this summer. The Capital Regional District has another study going on, and we will be receiving their report early in the new year.
We have transportation priorities that have been determined by regional transportation committees. That information is still available. Various studies that have been done for the ministry are available, and they will all be brought into the mix. The various Crowns have their own plans that are being gathered together. Plans of other organizations, such as B.C. Rail or the airport authority, are being brought together. All of those things are happening, so there will be a coalescing of this information and an updating of it to reflect current conditions and expected population trends based on current studies.
A significant incidental benefit to user-pay and to tolls, which I did not mention and which may come up subsequently in these estimates, is traffic demand management. We have the technical capability today of adjusting tolls on a quarter-hour basis, if we feel like it, and of bringing in tolls that might be higher during typical peak periods, lower in off-peak periods and, conceivably, no toll at all overnight or late evening. Those are all possible now. We are looking at that in conjunction with the high-occupancy-vehicle lanes and with the extension through B.C. Transit of additional bus capability; the Hastings-Barnett people-moving project is an example of this. The Trans-Canada Highway jumps out as a possibility, as well as Highway 99 and several other routes, for high-occupancy-vehicle lanes. So making transit attractive, safe, reliable, secure, friendly -- everybody has a seat sort of thing -- combined with a disincentive to take your own ton-and-a-half of metal downtown with you is the direction that we want to go.
With respect to the national highways system, the federal government draws out of British Columbia perhaps $500 million year in fuel excise taxes and has returned something like $18 million in the past 25 years since the completion of the Trans-Canada. I regret to say, however, that the federal government broke off the national highway system negotiations and implemented unilaterally something that they have called the strategic highways initiative program. They did so late last fall. We may participate in it to a limited degree.
They take half a billion dollars a year and have made the magnificent offer of approximately $6 million a year for five years to help solve our transportation problems. It's a return of more like 1 percent of what they take. Unfortunately, I have heard directly from the Minister of Transport in person when I was in Toronto a couple of weeks back with the other transportation ministers. The flat statement was made that the federal Treasury Board was simply not going to put any more money on the table. My critic has suggested a 50 percent return. Frankly, I would be delighted with a 10 percent return, but it's not even likely to be that.
We will be picking up the negotiations for the national highway policy in the fall. A substantial majority among the provinces -- I would go so far as to say unanimously -- want it on the basis of a funding formula that at one point in time was defined and agreed to by all jurisdictions. Then the feds unilaterally decided to dramatically change the funding formula, which caused the loss of support of the province of Ontario -- very understandably, because they were being shortchanged dramatically. On that pretext the federal government then withdrew from the negotiating process. However, as I say, I hope to see it up, and we'll try again in the fall.
With respect to where we go from here, I will look to the Chair for the wisdom on which section we call next.
[ Page 6767 ]
The Chair: Thank you, minister. I would just advise committee members that there are only two votes in Highways: votes 58 and 59. It would seem to me, if agreeable to the parties, that we simply deal with all Highways expenditures at once, rather than in a seriatim fashion. Is that acceptable?
D. Symons: I think last year we did vote 58 first, and it included 59 automatically. So we're basically doing that.
The Chair: Fine. We shall do so then.
D. Symons: Just before we start the actual estimates, I would ask -- maybe it's an oversight -- the minister to introduce the guests. We are all friends here, but for the record, I suppose, we should have their names.
Hon. A. Charbonneau: I could do that: my deputy, Vince Collins; assistant deputy in operations, Dan Doyle; assistant deputy in finance, Gordon Hogg; and assistant deputy in planning, Bruce McKeown.
D. Symons: Thank you. I wonder if we might look at vote 58 to begin with, since it comes first. The first thing that struck me here, under Salaries and Benefits, STOBs 1 through 3, is: how many staff members are there in the minister's office now?
Hon. A. Charbonneau: There are currently eight staff members.
D. Symons: I note that's the same number you gave me last year. There have, however, been some changes in your office. You have a new administrative assistant as of May 20, I believe. How do the salary and benefits of the new holder of that position compare with those of the previous holder of that position?
Hon. A. Charbonneau: I'm sorry, but I missed "that holder." Which one were you referring to?
D. Symons: The person who is now your administrative assistant as of, I believe, May 20 by order-in-council.
Hon. A. Charbonneau: It is the same salary and the same benefits -- just a change of person.
D. Symons: You also have a new ministerial assistant. Are there any salary or benefit changes involved in that position?
Hon. A. Charbonneau: It's the same salary and the same benefits -- again, just a change of person.
The Chair: Excuse me, could I ask both minister and member to please wait for the Chair to acknowledge you, simply because it wreaks havoc with Hansard if we don't do it that way.
[3:30]
D. Symons: Thank you. We're just so fast; I guess we want to get this over with.
The previous ministerial assistant was brought out from the Maritimes at a relocation cost that I think neared $12,000 to the taxpayers of British Columbia. Are there any relocation or transfer expenses for any of the minister's office staff -- with the two new positions or with any other changes that may have taken place in the last year? If so, you might tell us how much was involved.
Hon. A. Charbonneau: There were no costs associated with either of the two new staff members.
D. Symons: I'm glad to hear that, because it looked like we were beginning to train people for other departments. You must have a good ministry there, in the sense that your staff are being swiped for elsewhere. The previous administrative assistant is now a special assistant to the minister. Is this a new position, or did that position exist before? Does the change in title also involve a change in salary or benefits?
[M. Lord in the chair.]
Hon. A. Charbonneau: There is a slight increase in salary. I could provide the dollar amount tomorrow, perhaps.
D. Symons: In the estimates book there appears to be an increase in employee benefits under STOB 3. What benefit changes would account for this particular increase?
Hon. A. Charbonneau: The benefits are determined as a flat percentage of base salaries; as the base salaries go up, so do the benefits.
D. Symons: I believe that the change there is considerably more in the benefits compared to the change in the flat salary. Maybe it's not that much; it does occur in some of the others.
I'm wondering now about the figure in the base salaries. Your staff has increased by 5 percent. Is this increase because you had more staff added, or is it possible that there have been salary increases?
Hon. A. Charbonneau: It was due to salary increases across government.
D. Symons: The number of staff in the ministry's office has stayed the same, so this is strictly increases in that 5 percent.... Is that the 5 percent the minister personally took as a decrease to make up for paying the others?
Hon. A. Charbonneau: I don't think it works that way.
D. Symons: Your salary wasn't high enough to cover all the others, I guess.
There are two new entries under the minister's expenses this year, STOBs 25 and 68, for information
[ Page 6768 ]
systems. Although these figures are small, in the absence of any such expenditures before, I wonder if the minister could tell the committee of the need for this cost.
Hon. A. Charbonneau: In one instance it is a charge that had previously been paid by the ministry related to phone charges -- for example, phone lines and cellular phones -- which is now charged against the ministry office. The second item had to do with some computer equipment.
D. Symons: So this is just a reorganization of ministry expenses and putting minister's office expenses where they originally....
Next Question: under STOB 30 the office and business expenses have more than doubled last year from the previous year. For this fiscal year it's dropped back slightly from last year's high, but it is still well above what the Social Credit had budgeted for office expenses. Considering cutbacks in the ministry, particularly in capital construction, could this figure not be lower? I wonder if you might explain why that figure is that high.
Hon. A. Charbonneau: I just seek to clarify. You're saying that one expense is slightly lower this year than last year, and you want to know where I derived these marvellous efficiencies from?
D. Symons: No, I didn't word it quite that way. It is under STOB 30; this year it's $14,000, and last year it was $17,000. The year previous to that, though, in the Socred years, it was $6,500. So it jumped dramatically last year. It has fallen back a little bit, but I'm still curious. They were able to get by with office and business expenses of under $7,000 two years ago. Why is it now costing twice that much?
Hon. A. Charbonneau: I cannot speak to why a previous minister of a different persuasion might have had such-and-such an expense. I'm sure you were satisfied with my explanation for my expenses last year during estimates, and you ought to be even more satisfied that I've reduced them this year.
D. Symons: When I asked that question last year you explained that it was for funding your office in Kamloops. Between then and now, that doesn't seem to be the case. That leads me to the next question. I'm assuming that's what STOB 65 does. Is that true?
Hon. A. Charbonneau: Again, with respect, we're talking about the changes from last year to this year. I'm still operating a minister's office in Kamloops at approximately the same cost. What is reflected there is strictly a rental cost, but it is no change from last year in any substantive way.
D. Symons: I suppose I'm asking then where the cost of operating an office -- be it rental, staff or whatever -- might appear in this particular line. Under which STOB number would it appear in vote 58?
Hon. A. Charbonneau: STOB 65 is the rent for the ministerial portion of my Kamloops office.
D. Symons: I'm wondering if the office you have in Kamloops is a stand-alone office separate from the regional offices in that city. I'm wondering if it might be more economical if you were simply to choose an office that was in the ministry offices already in Kamloops and therefore save the taxpayers a little bit of money on that and on other office expenses that are incidental to the rental.
Hon. A. Charbonneau: I guess I could take you to Kamloops and show you Phil Gaglardi's old office in the ministerial buildings. But the rent that would be charged through BCBC against my minister's office account would show up in any event, and in fact it would likely be substantially higher. I have a very good deal with the landlord where, by adding a very small amount of space to where I was, I am able to accomplish this at truly a bargain price.
D. Symons: I can attest to that, because the figure here makes me jealous in regard to what I am paying for my constituency office in Richmond. I think I should be voted in in Kamloops next time, and I'll have a much lower rent, obviously, than in Richmond. I can see that.
What I notice here is that in the minister's office vote 58 for operating costs has increased by 15 percent overall. I am wondering if this increase is acceptable at this time of fiscal restraint, especially in the light of the fact that capital construction is greatly reduced, and a new, separate Transportation Financing Authority has been created to deal with construction of new highways in the province. That would seem inappropriate to me, since there is a reduction in the responsibility of the minister's office; there should be a corresponding reduction in expenditures.
Hon. A. Charbonneau: From last year to this year, there has in fact been an increase in responsibilities with B.C. Ferries and with ICBC. The amount of work that is done on capital projects does not correlate with the work that is done in the minister's office. Sometimes it takes as much time -- or, I would submit, more -- to explain to groups and to meet with and explain to mayors why something can't be done this year. That is where much of my expenses and time are taken up. On the other hand, if the member does wish to go for the Liberal nomination in Kamloops, I would be willing to assist.
D. Symons: Thank you. I may take you up on that.
I notice, though, that when Ferries was under the Ministry of Transportation -- before the current administration; now it's been returned to its proper home -- the overall spending on the ministry's office was still somewhat lower than it currently is. I don't know if these increased responsibilities would account for increased costs here. I find it interesting that you were saying that part of these increased costs are brought about by the fact that you're spending less. You have to spend more to spend less is basically what you
[ Page 6769 ]
were telling me because of the problem of arguing with the community as to why they are not getting what they think they are entitled to.
Under administration and support services in vote 59, I find that under STOBs 1, 2 and 3 the amount budgeted for basic salaries has decreased by over 20 percent. Is this due to reduction in staff in the department, or is it because of wage reductions? How many full-time equivalents are covered in this particular line in the estimates?
Hon. A. Charbonneau: Some efficiencies have been gained. There has been a reduction of 12 staff in that department, and the reduced number reflects that.
D. Symons: I believe that last year you gave me the figure of 225 staff members, so that would be 213 now, if I read your answer correctly.
Hon. A. Charbonneau: I think that should have been expressed in terms of positions, but yes, that is correct.
D. Symons: There has also been an almost 50 percent reduction in STOB 2, the supplementary salary costs. What premiums or allowances have been discontinued? I think the larger reduction there couldn't be reflected just by the fact that you've cut back a few staff members. So what accounts for this remarkable reduction?
[3:45]
Hon. A. Charbonneau: The major element of that item has to do with the Coquihalla toll plaza and shift premiums associated with the operation of it. Through better efficiencies we have been able to substantially reduce the shift premiums.
D. Symons: I'm glad to hear that the efficiencies are working well there. However, I notice the amount for employee benefits has not seen a reduction that's proportional to the basic salaries. While basic salaries have dropped by over 20 percent, the benefits part has stayed virtually the same. So last year the benefits were about 20 percent of the basic salary budget, and this year they're closer to 25 percent of the basic salary budget. Why this proportional increase in the benefits?
Hon. A. Charbonneau: The item includes relocation allowances. As we are reducing the number of positions, we were allowing that there could be some take-up on relocation allowances.
D. Symons: There has been a substantial reduction of close to 40 percent in STOB 20, the professional services. Does this represent a reduction in these services, or will these services simply reappear under the new Transportation Financing Authority that's set up by Bill 3?
Hon. A. Charbonneau: Part of the overall strategy over the last year has been to make more use of staff and less use of contractors, and this reflects that.
D. Symons: I guess I'm going to be asking quite often about some sort of relationship between the current staffing of the Ministry of Transportation and Highways and how that's going to fit in with this new Transportation Financing Authority. I wonder, when there are reductions here, whether it's reappearing on the other side, or what the case is. You're saying that in this case there isn't a relationship of that sort. I'm concerned that there may be some duplication going on here. Could you point out to the committee where the reductions in staff and spending are within your ministry, which are going to offset the functions that will be taken up by this new Transportation Financing Authority? Apparently some of the things in its mandate seem to parallel activities, planning, and so forth, that take place already in the ministry.
Hon. A. Charbonneau: Well, those changes and the expenditures related to them have not, of course, occurred at this time. But I must inform the member that it is not the intention to build a large, fully functioning Crown corporation like B.C. Ferries or ICBC. The Crown corporation created as the Transportation Financing Authority will be primarily a financing authority. It will do some planning, but I don't anticipate that we're looking at more than a dozen staff members. It will not duplicate the design capacity of the ministry. It will have an overview capability and a strategic planning capability both on the transportation side and on the financial side. I would anticipate that in fact a number of those staff members will be seconded in from either the ministry or from Crowns.
D. Symons: That leads up to my next question: are there members of your ministry who have been or will be transferred over to this authority? I assume you're saying that there may be some who will do that. Has the Transportation Financing Authority begun to operate in any way?
Hon. A. Charbonneau: No, at this point in time it has not begun to operate.
D. Symons: Since you will be the chairman of that particular group, I'm wondering if there's a timetable that we can look forward to, so that we will be able to tell where the $85 million in there is going, and what works for this particular year will be funded. Is there a timetable for that authority to begin operating?
Hon. A. Charbonneau: Yes, there is a timetable that you can look forward to.
D. Symons: I would gather from that answer that the minister is being somewhat cagey and isn't going to divulge what this timetable is going to be. What is be the projected number of full-time-equivalents who will be working on policy and planning in this agency? You mentioned a dozen. Is that roughly the figure? Will these full-time-equivalents be on staff, or are they going to be contracted out or seconded in? Are they likely to be all staff members or people brought in temporarily for certain jobs?
[ Page 6770 ]
Hon. A. Charbonneau: Some staff members of the authority will be seconded in from either Crowns or the ministry. There may be some who will be hired, and from time to time that financing authority may contract out certain things.
L. Hanson: Now that the subject of B.C. 21 has come up, I think it's important that we in the opposition get some understanding of what we can expect in terms of reporting. We recognize that it's a Crown corporation and that the need for reporting as a Crown corporation is quite different from the need to report to the Legislature and question those estimates. Let me outline some things that may be of concern.
First of all, we get a very close scrutiny of FTEs, as an example, in the ministry. We're transferring a number of the responsibilities that normally -- and I don't know what's normal in the world anymore -- have been under the management of the deputy, the assistant deputy and the Minister of Highways. Those FTEs, and the people who do the planning, the processing and everything, come to this forum for scrutiny. Can the minister give us some idea of what the difference will be now that we have the financing authority, which is going to assume some of the responsibilities that are now being carried out within the ministry?
Hon. A. Charbonneau: As I've said, first, I do not see the transportation authority replacing the ministry in terms of the design and delivery of product. Furthermore, I see that we are adding some planning capacity here which up to this time, to my knowledge, has not existed. We have not had planning that brings together all the Crowns related to transportation and the agencies outside of the provincial government. We have not had planning of that magnitude. That planning could conceivably be done within the ministry by staffing for it, or it could be done in the Crown by staffing for it.
Under B.C. 21 we will get into the financing of projects and the capitalization of projects. Joint ventures are possible with private capital or perhaps with union pension capital. All of those have been suggested to me. I've had submissions from a number of firms regarding the possibility of joint ventures. That kind of thinking has not been done before. It requires some capability to be added within the ministry, in terms of this financial planning: the revenue expenditure, the business plans for various possible projects, the financial payback that relates to various projects and cost-benefit ratios -- the kind of work that has not been done heretofore. We can staff up to do that either within the ministry or within the transportation authority.
If we have people, as we do both in the ministry and in various Crowns, who have capabilities that could be developed, some of them will be seconded. So it will be a case of which office the individual is working in. I do not see it as an unnecessary salary burden on government -- either directly or indirectly -- with respect to the accountability, be it through the FTEs, the projects or the costs.
There will be the opportunity, of course, in the estimates process next year to query the responsible minister very closely on every kind of expenditure that that agency has been involved in and plans to be involved in in the coming year. As well, of course, there is the opportunity every time the House sits to raise issues related to the financing authority in question period, the same as issues are raised today with respect to the Ferry Corporation or to ICBC. There will be full and open accountability of a new, exciting and more efficient way of delivering a quality transportation product.
L. Hanson: Well, I guess this is part of the debate on Bill 3 that went on, and it certainly was addressed in the House. I suppose the only comment I can make as a result of what the minister has assured us is to get his assurance on the record and watch what happens, so that we're well aware of what we might be able to look for next year in the estimates. I don't think there's any doubt that there is a concern in my party and in an awful lot of people who I've talked to. The formation of B.C. 21 as a financing authority is in itself understandable, but the need for the Crown corporations to be set at arm's length from Highways is a little more difficult to understand. It could be done within the Ministry of Highways if you make the policy judgment to amortize the cost of highways over their life.
Some questions we might want to look at are the term of the amortization, and what is happening in B.C. 21 compared to what was happening before in the Ministry of Highways, where all of these similar things were done. I know the minister has suggested that there hasn't been a long-term planning process. We could get into an argument about that, but I'm not sure it would be to the benefit of the estimates.
[4:00]
I'm not going to ask any more questions on B.C. 21; I'm going to look at it with great interest over the next year to see if what is happening is what we were told was going to happen. That is a serious concern. I think you know my philosophy -- and have for some time. I'm not opposed to tolls or to amortizing highways over a period, as long as there is a requirement to balance the other side of the budget.
Hon. A. Charbonneau: I will take the comments as I'm sure they were intended. I will just add in passing that I did not mean to state -- if that is what you heard -- that there was no long-term planning. There has been long-term planning. I'm suggesting that the kind of overarching integrated planning between rail, airport authority, ferries and highways has not occurred -- at least not to my knowledge. I would imagine it has occurred on an ad hoc basis, but I have not seen the benefit of any overarching plan for the transportation of all of British Columbia. I'm sure, however, there was long-term planning -- and good long-term planning.
D. Symons: Just on the minister's last comment, I note that at the same time during estimates last year, I asked that question about the cooperation and the
[ Page 6771 ]
coordinating of activities among the various arms of transportation in this province. You indicated that there was a committee -- granted, at that time you mentioned it hadn't met yet -- that was to work together on that. I think a coordinating committee could have been set up within the various ministries involved. It might not have the same effect as what you seem to be describing now, but the possibility of cooperating seemed to be there in the past, and I'm sure it could have taken place.
[H. Giesbrecht in the chair.]
Not too long ago I attended a function that you spoke at. It was an event sponsored by the B.C. Road Builders' Association on investigating private financing of public infrastructure. Primarily, it was dealing with highways. A gentleman with the highways ministry from California was explaining how they are working in that state. It was a very interesting afternoon and evening, listening to these gentlemen speak about what appeared to be a very worthwhile project to look into.
Besides the gasoline tax and the possibility of tolls, I'm wondering if the ministry is looking at the idea of actually giving a company the right to build a highway. They would bid on this -- tolls, build, operate and transfer arrangements, or various combinations of those. Has the ministry done some studies on that, and where are those studies at?
Hon. A. Charbonneau: Proposals have been put forward to me involving the so-called BOT -- build, operate and transfer -- proposals relating to finance and design and proposals relating to finance, design and construct. I will contemplate the possibility of any or all of those in the process of establishing, starting up and operating B.C. 21.
D. Symons: Has the minister been approached by any consortium or business people with suggestions of taking on a particular project? Has someone actually said to the ministry that they would be willing to build a bridge here, given certain conditions? I'm wondering if approaches have been made to the ministry.
Hon. A. Charbonneau: Yes, there have been explicit statements of interest with respect to either rehabilitation or replacement of the Lions Gate Bridge, for example.
D. Symons: Is the ministry giving these serious consideration or waiting until B.C. 21 is up and operating?
Hon. A. Charbonneau: There is nothing going forward on that right now. As I stated earlier, however, Bill 3 establishes the Transportation Financing Authority and gives it the authority to enter into joint ventures. I will be considering the possible use of private pools of capital in transportation projects.
D. Symons: I am pleased to hear that, because by simply using the gasoline tax or tolls as a means of funding, the interest charges on the large number of projects that need doing in this province would quickly strip either the new financing authority or the ministry of a lot of its discretionary funds for a good number of years. We would be boxing ourselves in for future years once we do these initial projects. Allowing private companies rather than the Crown to take that risk seems to be a way of avoiding that.
I wonder if I could return to vote 59. Before we go back, there is something on this thought. If you have comments on that, or another speaker....
L. Hanson: I have one more question on B.C. 21. You mentioned earlier that there may be about $85 million spent on highways this year. Do you have projects that you are actually contemplating doing with that money, or is it for this all-encompassing study about transportation in British Columbia?
Hon. A. Charbonneau: The $85 million that I have been allocated is for projects. I have a list of projects in mind and will be making announcements at the appropriate time.
L. Hanson: I understand the timetable for this year that the passage of Bill 3 has created for the ministry. Hopefully, next year the projects of B.C. 21 will be available at estimate time for these sorts of questions.
Hon. A. Charbonneau: It is reasonable to expect that the details of some projects which are proceeding could be shared at estimates time. I will not make the commitment that all projects will be foreseen. They could be accounted for and questioned in a following estimates period, however.
L. Hanson: One of our concerns was that at estimates time we would have a fairly free and broad-ranging discussion of the projects that Highways has undertaken for the year. Even though we don't always know what the specifics are, we have a dollar figure attached to what we might be doing in the coming year. That doesn't seem to be easily or readily available to us in estimates under this new process.
Hon. A. Charbonneau: It is my view that once the strategic plan is completed and accepted as the basis, we would see what projects are intended to be started in a given year. Business plans and revenue expenditures must be prepared for them, and I for one would be willing to share that information at estimates time. I would think that by and large the plans for expenditures -- the plans of what projects to undertake -- will be fairly well known at estimates time.
I'm just saying that it's the same as in the ministry, when due to developments through the year, we sometimes end up undertaking a project that was not on the books at estimates time. Should the funds come available -- through savings or cancellation of other projects -- we proceed to do that, even though it is an item that did not come up at estimates. If there was anything untoward about it, it could certainly be caught either in the process of the House or at subsequent estimates periods. But it is my intention to be as full and
[ Page 6772 ]
open, in terms of disclosure, as I possibly can, given the information that I would have in hand at the time.
D. Symons: I was going to return to the vote, but just for a moment I'd like to carry along with that. I've been reading in Hansard the debate on the Freedom to Move initiative by the Social Credit, and it seems that many of the concerns we are currently expressing were exactly what the NDP were expressing at that time about the Freedom to Move. One of them was what you just mentioned: the business of being able to move money from one particular project to another. It seemed to bother the NDP opposition a great deal that the Freedom to Move would give the ministry that freedom. You're sort of saying now that you've built this into the way that B.C. 21 is going to work. And I'm wondering why it was of concern that we can shift moneys around a few years ago, it seems to be a plus now, whereas it was a negative at that time.
Hon. A. Charbonneau: I don't know that the Freedom to Move was intended as freedom to move money; I thought it was more freedom to move.
D. Symons: The option was there.
Hon. A. Charbonneau: Hon. member, I'm just being straightforward and honest. I cannot at this time foretell precisely what the expenditures will be or what projects will be undertaken, even within my ministry. At the time of estimates last year I stated, for example, that the Castlegar bridge was not going to proceed. To the best of my knowledge at that point in time, I was simply not going to have the money to do it. But as things developed through the year -- you save money on this or that project, or for other reasons a project is not started or property is not acquired -- moneys came available. I was delighted. That allowed me, midway in the year, to announce that we would proceed on Castlegar.
I would have no hesitance in sharing at some future time -- should I be the responsible minister -- my list of priorities, and down to this point on the list is what we intend to undertake this year. Should it become possible through the year to add another item to that list, I will go down the priority list -- and you will know what those priorities are -- and add a project.
D. Symons: In the Freedom to Move, when you look at the Estimates book, you see all those figures you're talking about listed down there in the priority of projects very nicely. It is there in the Estimates. I guess that may be some of our concern on this new financing authority -- that there wasn't built into it the necessity that these things be spelled out in that way. You're very graciously offering to make those available to us, but it doesn't seem to be built into the system that that need be the case. Maybe that was a lot of our concern when the reading of that bill took place. When some projects are going through in the manner they are and you're saying that we'll find out maybe a year later some of these changes that take place, it does beg the question whether this is a Ministry of Transportation and Highways operation or whether it's now a Transportation Financing Authority operation. Although one was set up as a financing authority -- because it has the planning structure and acquisitions and all these other things built into that act as well.... This is where I was bothered about the overlapping. I begin to wonder if this is a Ministry of Transportation project that they're going to finance. If so, somehow I feel it should be here, and it isn't.
[4:15]
Hon. A. Charbonneau: I think you're making it something that doesn't exist. The Transportation Financing Authority will do some overall strategic planning and determine, through overall strategic financial planning, what the priorities should be and what the rationale for projects should be, and they'll do so with minimal staff. Once those decisions have been made -- and they will be made in a very public way -- the projects will be passed over to the ministry for the actual implementation, the actual design, the acquisition of properties and the construction. All of that will carry on as it does now. We're speaking strictly of the ability to do the over-arching planning on both the financial and the transportation side.
D. Symons: Would the ministry then bill to the financing authority the cost of the planning? Will this all be built into the cost of the project, so that what the ministry is doing for that particular project will now become a cost billed to that particular project and go through the Transportation Financing Authority? Or is it going to be carried on in the normal way under the various STOBs that we currently do here?
Hon. A. Charbonneau: The lion's share of the actual expenditures will show up in the ministry. The financing authority will be charged with raising the money and with doing whatever planning work is necessary for them to come up with the priorities within that planning -- other expenditures that they might have with respect to actually arranging the access to capital, whether it be private pools of capital in a joint venture or issuing a bond, for example. So the financing authority, in its books, will show the aggregated amounts, including amounts that they expend themselves as the so-to-speak cost of doing business, but the expenditures will show up. I don't know if it will be 98 percent or what have you, but the major expenditure on any project will show up within the regular accounts of the ministry.
L. Hanson: I said that I didn't have any more questions, but things keep coming to mind when I listen to the minister speak. I'm a little confused, because when we were discussing Bill 21 in the Legislature there was a lot of talk that as far as highways were concerned it was a financing authority.
Now it seems that the minister has expanded that slightly, because it seems to me that the overall planning and the prioritization of the various projects around the province would not be the responsibility of a financing authority. It seems to me that they would
[ Page 6773 ]
rest with the ministry. I guess I'm a very simple person, so I would look at it in this manner: the Minister of Highways would look at a highway and say, "That's our number one project in the province," and communicate that to B.C. 21 and ask, "Do we have enough money or the financing ability to build that highway, because it's our number one priority?" after this blanket study was done.
From what I'm getting from the minister, it sounds more like B.C. 21 is going to make the decision as to what priority is in the province, besides providing the financing over a period of time.
Hon. A. Charbonneau: For clarity, I would like to separate the elements of B.C. 21. B.C. 21 is dealing with the $100 million special account, the coordination of Crown spending on capital and the accelerated social infrastructure. The remaining element of B.C. 21 is the Transportation Financing Authority, and it is only the Transportation Financing Authority that I am responsible for -- or will be, as the chair of that Crown corporation.
I have said from the outset that I saw the function of that Crown corporation to be strategic planning on the transportation side and on the financing side. I feel that is desirable because we shouldn't have just the Ministry of Transportation and Highways deciding that this is the highway we should build, and this is how much money we need. We need an agency that can say: "We could build this highway with this amount of money; or we could build this transit system and this different highway with this amount of money; or we could build these fast ferries, combined with these HOV lanes, this rapid transit link and this kind of highway." We need someone to do that kind of blue-sky thinking and planning. We don't need a lot of people, but we need some good people at a moderately high level of planning.
I'm saying that I see the financing Aathority as having a small core staff, and I tossed out a number like a dozen. Most of them would be seconded from existing government operations at a suitably high level to do that kind of strategic thinking. They would do it on the financing side: working out joint ventures, finding partners in the private sector to do that, determining the pluses and minuses of tolls, determining how you fit in tolls and traffic demand management with transit and all of that kind of thing. Let them do the large-scale thinking. Once a decision has been made that this highway, this piece of infrastructure, this bridge or this tunnel needs to be built or expanded, then the Ministry of Highways would be handed that assignment to go on and do the very important job related to the detailed planning of everything to do with it -- that is a sizable task -- and then to actually deliver the product.
So there's no overlap of services. It's not a nefarious scheme that I have come up with to hide things away. I believe it is just a more sane and rational way to plan and implement some transportation strategies.
D. Symons: I'd like to revisit just for a moment the question I asked a while ago. Maybe I didn't make myself quite clear on it -- this business of whether the financing authority would pay back to the ministry the expenses related to carrying out a project.
As I understand, it was given with Bill 3 that this is going to be financing projects that would basically be self-financing or at least self-liquidating, in the sense that we are going to be using tolls or gasoline tax or something to end up paying those moneys back. If we take the Lions Gate Bridge as an example -- a new bridge is built across the Lions Gate there -- then through tolls you are going to be paying back into the financing authority the money that was forwarded for building the project. My question, then, was about part of the total expense of building the project being borne by the ministry, and these people you have there in the planning and the operations end of it that were putting it together -- the next step after it goes from this financing authority. That's why I'm asking: when the money goes back into the financing authority from tolls, is the ministry then being, in a sense, reimbursed for its expenses? Is that total expense of the bridge being reimbursed, and does the ministry get its share of that reimbursement from the tolls collected over the years?
Hon. A. Charbonneau: The ministry will receive funds -- let us say, as an example -- to replace the Lions Gate Bridge. It will receive funds to do that from the financing authority in the same way we would now receive the funds from general revenue. It is up to the financing authority to determine where it will access those funds and how it will pay them back. They might put out a bond issue and raise whatever it is -- $200 million -- and pass that over to the ministry to do the work on some schedule. It will be up to the financing authority to bear the bridge financing, if you will permit me, and then to repay the bonds, to amortize them over whatever -- 30 years -- and to handle the money coming in, be it from a dedicated tax or dedicated tolls, and to retire the debt.
D. Symons: Okay. We'll go back to the actual estimates and vote 59. I'd like to look at the line covering administration and support services, if we could. I note in there that the office and business expenses have been reduced by 40 percent. Is this a direct result of smaller staff, or have you streamlined operations to reduce expenses?
Hon. A. Charbonneau: It is related to efficiencies, the reduction of staff.
D. Symons: Thank you. I am just trying to keep notes here; I don't have the advantage of the staff you have. STOB 50 has been reduced from close to $1 million to under $200,000. Maybe you could share with this committee how that's been accomplished, and possibly we could apply that technique to other ministries in levels of government.
Hon. A. Charbonneau: Could you repeat your specific question?
D. Symons: I'm looking at STOB 50 under administration and support services. For estimates last
[ Page 6774 ]
year, the figure was $893 million and some-odd hundreds after that, and this year it's only $169 million.
Interjection.
D. Symons: I beg your pardon. Am I putting my decimal in the wrong spot? It was $893,000, and now it's $169,000. It's a rather dramatic drop there, and I'm wondering if the techniques you have used there could be applied to all the ministries. We would save the government a great deal of money if that would work.
[4:30]
Hon. A. Charbonneau: I'm going to try to cut to the chase, if you will. In the process of estimates, you can slice and dice and come up with a whole number of different lines that add up to a number at the bottom. In the process of actually going through the year, you find for a whole variety of reasons that something gets charged to that one instead of this one -- sort of micro-decisions that are made all through the year. The bottom line is what counts: what we anticipated spending overall in these areas and what we actually end up spending.
The movement from item to item or from line to line can sometimes occur for a variety of reasons -- in an almost random way from year to year as to where something happens to end up being accounted for. If you were to take it all apart and put it all back together again, you would still end up talking mainly about the bottom line as opposed to which cubbyhole it ended up being accounted for in as opposed to which cubbyhole it was anticipated to fit in. I would suggest some attention to the overall numbers.
If you look at the overall admin and support services, last year's estimate was $30,692,000, and for the coming year the estimate is $298,693,000 -- perhaps a 3 percent difference. How you end up with a column of numbers that adds up to those as they are thought to be now, and as they will end up being then, would be a very tedious process to go through on a line-by-line basis, explaining why such and such an item got moved to such and such a line. Overall, you can see that we are looking at a reduction of about 3 percent.
D. Symons: I don't think it would be 3 percent there, but there is a reduction in the total figures you are speaking of. I'm a little disappointed in the answer. It's not that your answer is wrong but rather that I was looking for something you had discovered -- a way of cutting expenses dramatically. That doesn't seem to be the case; it's a case of where the cubbyholes were this time compared to last time. I was just hoping that maybe we had the secret of cutting government expenses covered under that particular entry here. Unfortunately, that's not the case.
There has been almost a $2 million increase for information services under acquisitions. That's under STOB 68. Does this not represent a rather expensive undertaking considering the state of the province's finances and general cutbacks in the ministry? I can understand the need for an adequate information system, but this seems to be a rather expensive expenditure at this time.
Hon. A. Charbonneau: These are related to some expenditures up at the Coquihalla toll plaza. From time to time allegations have been made about how funds are handled there. We're putting in a security system that will cut to the bottom of this and demonstrate that the funds are being handled in a safe and secure way. I believe that it's a very wise expenditure in order to get a certain handle on what could otherwise be a significant problem.
D. Symons: Thank you for that answer. I note that you're getting a handle on it, and it's costing roughly 10 percent of the yearly take in the Coquihalla tolls. This is about a $3 million expenditure for the new information system there. It does seem like it's a rather expensive system you're putting in for the amount of tolls that are taken at that particular location, but if it helps year by year I suppose it's an investment in the future. Do you have comments on that?
Hon. A. Charbonneau: The expenditure that I referred to at the Coquihalla toll plaza wasn't all of the expenditure, but it was the largest element of it. It was a onetime expenditure, so I don't think you should look upon it as a certain fraction of this year's net. It is something that you should amortize as a cost of doing business, of providing the level of security that probably should have been there in the first instance. You should look at amortizing it over five or ten years. That is how business would look at it. I might add that it's simply an unavoidable cost of doing business.
D. Symons: I wonder if we can move into the next line in the figures here. You commented about putting things in cubbyholes, and I do find it interesting looking at the estimates to see how things have changed and where priorities seem to be placed in here. So I'd like to move to the next line, which deals with transportation policy and planning, and municipal programs.
The first question I have concerns the rather large increase in the base salaries category, and I assume that this represents an increase in staffing. How many FTEs does this $1.35 million increase represent? Is part of this increase due to salary increases, pay equity or causes other than new staff?
Hon. A. Charbonneau: Again, it's an allocation. In this instance, certain staff that had been paid for under admin have now been charged to transportation policy and planning. If you look at your totals under administration and support services, it is proposed that it will drop by almost $1.5 million. Transportation policy and planning is shown to increase by about $600,000. But it is not an increase in FTEs overall; it is a matter of allocating certain FTEs -- again moving them from one account to another account. Overall though, there is no addition.
[ Page 6775 ]
D. Symons: So if we take the admin and the transportation policy lines together, then this is going to balance out. That's what you were saying. Then would the decrease in professional services, which is item 20, mean that there is more policy and planning being done in-house rather than being contracted out?
Hon. A. Charbonneau: Yes, that is substantially correct.
D. Symons: There was no funding for advertising, statutory notices or non-discretionary funds before, and I notice that there is some this year -- at the minimum, mind you. Is this the beginning of the growth in these expenditures, and what has changed that you now have these expenditures there?
Hon. A. Charbonneau: If we're going to discuss a budget of $350 million by $5,000 at a time, we are going to be here an awfully long time. The details of that particular $5,000 expenditure are not available at this time. It goes down to a level of detail that I would never expect my officials to have here. If you wish to leave that question on the record, however, we will do extensive research into it -- probably at the expense of more than $5,000 -- and report to you at a subsequent session.
D. Symons: Point well taken.
The municipal contributions, item 82, are down by 35 percent: $8 million for this fiscal year compared to $12 million for last year and $20 for the year before that. Does this represent a cost savings by downloading onto local municipal governments? I feel that municipal governments and homeowners should not have to bear the brunt of changes to municipal grants.
Hon. A. Charbonneau: I was given very tough marching orders from Treasury Board. I have to find savings in a variety of ways. I cannot save on operation and maintenance; they're locked into contracts with the maintenance contractors. Rehabilitation would not be a wise place to try to save money.
So I looked at those areas where we could save some money either through the delay of projects on the capital side or through expecting municipalities to make the same kinds of decisions in their area of responsibility. They will have to share the pain, so to speak. If we have to cut back on the kinds of projects we want to do but are simply unable to, given the financial situation of the government, then we simply expect that the municipalities will cut back on what they wish to do at the same time. In no sense are we saying that they're not necessary or desirable projects; we're simply saying that if we're going to get the deficit down, we have to cut expenditures. This is one area where I chose to cut expenditures.
[4:45]
D. Symons: That answer maybe explains what you mentioned earlier about the difficulty with the municipalities, and the fact that you have to do more travelling because of the problems you're having in selling some of the things going on. I'm sure that would be one that municipalities would have a great deal of difficulty with.
I'm wondering if you might tell me what the nature of these municipal grants is. What do municipalities get grants in the ministry from? On what basis are these projects prioritized? Who determines the priority of the projects? Is this done within the municipalities? And how do regional districts fit into this program?
Hon. A. Charbonneau: I'm going to take advantage of a new procedure here, which I think we should have been following long ago. Rather than from time to time, on detailed questions, having answers whispered in my ear, I'm going to ask my deputy to participate in this and give you some answers directly.
D. Symons: That would be fine.
V. Collins: There are two principal areas in which grants involving municipalities are handled. The first is secondary highways. The ministry has had a program for a long time designated as secondary highways -- those being highways on which there is a substantial amount of traffic moving from outside a municipal boundary through the municipality to another municipality or unorganized territory. The ministry evaluates requests received from municipalities for those capital grants each year through our district offices. A prioritization is given both at the district and regional levels. Those are aggregated at headquarters, and a total provincial assessment is made on the overall basis for that program. Recommendations are then made to the minister, based upon that technical assessment of the amount of moneys that should be allocated in turn based upon the budget allocated to the minister by Treasury Board. That's the secondary highways program, which makes up approximately $4 million of capital moneys in the past budget and approximately $2 million this year.
Incorporation grants are provided to municipalities that are either newly incorporated or are expanding their boundaries -- either of which has impact upon formerly provincial highways. Under that set of circumstances, a formula is struck with the incorporating or expanding municipality. There is an agreement whereby, over a period normally of seven or eight years, the municipality which has just been created or expanded has an opportunity to apply for capital funds. Those requests for capital fund allocations from the ministry are evaluated -- again, each request every year -- based upon their priority as well as the ministry's ability to pay. As the minister has indicated, based upon priorities, those funds for capital have been eliminated this year. But municipalities have been advised that they'll be free to continue to apply in future years.
D. Symons: I feel that some municipalities -- particularly some in the lower Fraser Valley -- can certainly be put at a hardship. A lot of those communities basically act as a thoroughfare for people further up the valley and for traffic to get into
[ Page 6776 ]
Vancouver, and it's not their traffic. Basically, you've cut back some of the ability they would have -- without going into their own taxpayers' pockets -- to service the traffic through their community that isn't theirs. This would seem to me to be a downloading of ministry responsibilities onto communities. I'm not sure how you managed to sell that to the communities out there.
Hon. A. Charbonneau: The member would be aware that a lot of the highways and roadways that he speaks of are primary highways or arterial roads, which the ministry pays 100 percent of, based on our own assessment of priorities. In addition to that, the municipalities can apply through Municipal Affairs for revenue-sharing to assist them on some of their projects.
D. Symons: In some places, like Burnaby, I think they find that many of their streets have been co-opted by people who are coming from further east -- and they wouldn't necessarily be highways. I'm sure that if you have managed to find it necessary to cut back on the amount of municipal funding through the Highways ministry, then the Minister of Municipal Affairs has probably done likewise. I'm not too sure whether the municipalities would be able to turn there for a little alleviation of this problem that seems to be put on their doorstep. I wonder if we could move on, then, unless you had something to add on that.
Let me move on to the subvote on highway operations. I notice that there's a 30 percent increase in the basic salaries -- to $16 million. At the same time there's a 50 percent increase in the benefits -- under item 3. I'm wondering how many more employees this increase would represent and what the total FTE is under this subvote. While we're at it, why is there the dramatic increase in the benefits part relative to the salaries?
Hon. A. Charbonneau: Again, it is a reallocation of personnel from one account to another, and the benefits still relate to about 20 percent of what the salaries were. They're both simply adjusted due to reallocation of staff.
D. Symons: I'm not quite sure on that answer. If the staff have been reallocated to make a 30 percent increase in this particular subvote, why would the benefits not correspondingly be around 30 percent, rather than at 50 percent? It seems that if you change the staff, the benefits would change in a proportional manner.
Hon. A. Charbonneau: I'm not sure if we're looking at the same numbers, and I don't have a calculator handy. They both look pretty close to 20 percent to me. If that does not seem to be the case to you, can you identify precisely the numbers that you're referring to?
D. Symons: I didn't have my calculator when I worked out those percentages, but I'm fairly good at doing it in my head. Maybe this is my mistake, but we will see. Last year under STOB 1, we had close to $11.5 million; this year it's very close to $16 million. That was my 30 percent increase there. The other figure under STOB 3 last year was $2.2 million, and now it's a little more than $3.3 million, which is roughly a 50 percent increase over the $2 million.
Hon. A. Charbonneau: The first figures that you mentioned were the original blue book, and there has been a restatement of those figures as a result of the reallocation of staff. So you're comparing a number that is, so to speak, one turn out of order. You have to go from the estimates to what the actuals were and then compare actuals to estimates. In looking at the numbers here, after the restatement of figures has occurred, the $11.5 million becomes just about $13 million, and the figure that you had mentioned of about $2.2 million became about $2.5 million. By my visual estimate, the ratios are pretty close with respect to benefits.
D. Symons: For my benefit then, what you're referring to is the figure.... We'll take last year's total voted expenditure. That was what we were talking about last year, and we are currently using the same figures at the very end of the line. It was some $37 million, but I see when we come to this year's estimates we start off with the voted estimate last year as a different figure. It is now some $39 million, so this is the corrected one. That's why there is the discrepancy between what we read in the last line of last year's and the first line of this year's. And you're saying that the $2 million and some odd is accounting for the differences I am referring to?
Hon. A. Charbonneau: The answer is yes. Looking at the restated figures for last year -- for example, the totals for highway operations: the restated add up to $39.2 million, and the estimates for this year are about $37.7 million -- a reduction.
D. Symons: So I wouldn't have these figures spread in there. When I am looking here -- and I may lead into this problem later on in my questions as well -- I will have the figure that was last year's voted estimate. Then I will have the corrected figure for that at the beginning of this year's. And if there is a difference in those two figures, as you are telling me now, then that spreads out somewhere among last year's figures. But I won't necessarily know where. You know where, but I don't until I ask a question, and you'll tell me where it is coming in. Okay. That will help a little later when I have some problems with differences. So if these figures are somewhat different, that may explain some of the questions I may be asking at a later date.
I suppose the decrease in professional services, item 20, is reflecting a switch from contracting out to having work done in-house. Is that correct, or will these services be picked up by our Transportation Financing Authority?
Hon. A. Charbonneau: A reduction in contracts.
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D. Symons: We notice that the non-discretionary publications budget in this particular year is only 15 percent of last year's funds. I had this interesting question: if it was non-discretionary last year and you can cut it back to a very small percentage of what it was, how come those cutbacks you're making aren't non-discretionary this year?
Hon. A. Charbonneau: The amounts in the previous year were related to the re-tendering and re-awarding of the maintenance contracts. There was a lot of activity that required that kind of advertising. We are not doing that this year, hence it falls to a very small figure.
D. Symons: I guess I didn't realize that the tendering of maintenance contracts runs to that much money for the 28 districts. There seems to be quite a bit of money involved in the advertising and whatever relating to that.
Under highways maintenance, there's an overall increase of 3 percent. Does the minister feel that this is a sufficient amount to maintain the current level of service?
[5:00]
Hon. A. Charbonneau: Referring for a moment to your previous comment about the level of advertising, you must realize that the value of contracts is about $350 million a year. That was the level of magnitude required or the total of all the contracts. In the process of advertising those opportunities all over the province in the ways that were required, we are talking about something like one-tenth of 1 percent of the value of the contracts taken up with advertising, so it's not really a figure that is out of order. Now I've forgotten your second question.
D. Symons: I was just going to comment on your comment, if I may. Or do you want the floor back?
Hon. A. Charbonneau: Yes, you can comment on my comment following your comment. The maintenance operation figure is set by the contracts, so it simply reflects what the contracts add up to this year.
D. Symons: My comment on your comment was: coming from a humble beginning and background, of course, these figures up in the millions of dollars are all quite large for me. I guess I still don't have a handle on talking about millions and billions of dollars yet, but I'm learning gradually with these expenses.
I'm wondering what professional services have been cut to account for the 30 percent reduction under STOB 20.
Hon. A. Charbonneau: I'm going to have to ask you to repeat that question. My staff was trying to find a different number for me.
D. Symons: I'm looking under STOB 20, highways maintenance, and I noted under professional services that there was a reduction of approximately 30 percent from the previous year. Since these are professional services, I'm wondering what professional services you're doing without.
Hon. A. Charbonneau: I'll have to take the question on advisement. Again, it deals with a level of detail that we do not have information for.
D. Symons: I note that the information systems in STOBS 25 and 68, taken together, have very significant increases. These large increases in information systems seem to come in other places throughout the ministry as well. I'm wondering if this is all one large computer mainframe and each department is basically paying for its share of the use of that mainframe. Or do you have some stand-alone systems?
Hon. A. Charbonneau: First, I'll refer again to the pigeonhole problem, where costs end up being allocated. If you look for STOB 25, the total restated was $22 million even, virtually, and for '94, about $22,200,000, which is virtually identical. Again, on a line-by-line basis there are changes within that where there has been reallocation.
On your second item, STOB 68, there is a substantial increase. Most of that increase had to do with the other item we discussed earlier -- the installation of the security system at the Coquihalla toll plaza. In addition to that, we have expended some funds on a pavement management system, which shows up in the difference between the amounts as well.
A. Cowie: I have a few general questions to ask. The ministry has a large planning staff in its regional offices, which I think is a good thing. Since Municipal Affairs don't have any, someone has to do the transportation planning. The next few questions will basically deal with the coordination of those two functions.
For instance, in Nelson you have at least one or two qualified PIBC planners. Could you tell me how many qualified planners you have in your regional offices?
Hon. A. Charbonneau: Could I seek a clarification, right off, of your definition of qualified?
A. Cowie: In transportation planning it would be an engineer with planning capability of some sort, who had gone through an engineering degree at UBC or some other engineering institute. I classify that as a qualified transportation planner. You also have a number of qualified professional land use planners, which you use in your ministry in your transportation and planning division. They are Planning Institute of B.C. members, and you call them planners. I'm just wondering how many you have.
Hon. A. Charbonneau: Before I give you a number, I want to clarify a bit more. We employ transportation planners, and they would typically have an engineering degree, a PEng status. We do not employ land use planners per se. We may end up employing someone who, by coincidence, has some qualifications as a land use planner, but that is not a qualification
[ Page 6778 ]
required in our organization. So are we talking about the same thing now? How many qualified engineering and transportation planners do we have?
A. Cowie: There are really two questions. I want to know how many qualified transportation planners you have in your regional offices. You can call them transportation engineers, but I call them planners -- those people with expertise on how to do transportation rather than road or bridge construction. Then I want to know how many qualified -- that is, professional, registered -- land use planners you have in your offices, I know you do have some, but I guess it's just purely by coincidence. I could name one as an example if you want me to. Don Barcham, for instance, is very well qualified and very expert. I congratulate you for having him on staff. How many of these sorts of people do you have?
Hon. A. Charbonneau: The number of transportation planners in each region varies from two to about ten. I don't have a precise number for you. It might be something in the order of four or five per region, on average. So it would be perhaps twenty in all of the regions. There are some who coincidentally might be qualified, registered land use planners; if we captured any of those it was not by explicit design. We are all qualified planners in transportation.
A. Cowie: I want to congratulate the minister for having these qualified people on staff. We all know that you can't do transportation planning without land use planning, and that you can't do land use planning without transportation planning. Your ministry is evolving in the right direction, whether you know it or not. I congratulate you for it, or whomever I have to congratulate.
Your personnel are the official approving officers in unorganized areas. It is something that always dismays me. I wonder if you plan to continue that practice. They are usually unqualified people who have worked their way up; they are charming people, but they have not been trained professionally in land use planning.
Hon. A. Charbonneau: I agree with the earlier comment on how land use planning and transportation planning interrelate. In Transport 2021 we see a very significant exercise where things are being put the right way around, which is getting in and doing some serious land use planning and then following that up with the transportation planning. It's happening mainly in 2021. I would like to see more land use planning happening in the Capital Regional District, in the Okanagan and in any other areas of rapid growth.
With respect to our approving officers, many years ago Transportation and Highways ended up in charge of this function on the basis of having offices out there. Inasmuch as the plans of developers had impact on our systems, it seemed logical that we be the ones to do the approving. I have been speaking to the Minister of Municipal Affairs about moving that from Transportation.
On the land use planning side, of course, we don't do that at all. That's a function of the regional district. Whoever they're dealing with in terms of developers deal with the regional district. They only come to us for the approval of their subdivision permits, say, when we can make comment or insist on changes with respect to how things impact on our system. I think the approvals process might reside best with the regional districts.
[5:15]
A. Cowie: As far as land use planning and unorganized areas are concerned, other than those just on the fringe of municipalities.... Municipalities should be larger and there shouldn't be those areas anyway, but that's beside the point. That will get corrected under Municipal Affairs someday, I would assume. Highways handle everything else but the land use. I mean, the regional districts will decide what the land use is, and then Highways handle absolutely everything else, whether there's flooding -- at least I assume flooding; flooding may still go through the regional district -- avalanche, road-access problems, the size of lots and those sorts of things. They all go through Highways, to my knowledge anyway, because anything I've ever had to do has always involved the approving officers. I still assume that they handle everything, including water, sewer and all of those things.
Hon. A. Charbonneau: No, you're ascribing to us powers and authorities and areas of influence that we don't have. Flooding, which you mentioned, really belongs with Environment. Some of the sewage issues belong with Environment, or perhaps the medical officer has something to say about that. We have nothing to do with lot sizes; they're in the regional district, I suppose. So there are a whole number of things that you've enumerated that we are not involved in. We are involved in the approvals of the subdivision plans. We do look at the impact on the road system and on the drainage as it impacts the road system.
W. Hartley: While we're on this subject, it reminded me of a situation I came across in the area I represent. Part of the area I represent is an electoral area, and it's my understanding that the Ministry of Transportation and Highways does look after the road system in electoral areas. I've always been concerned about the impact on the ministry and thought that perhaps the development community could be more involved in looking after the road system. It's my understanding that in an electoral area, where no official community plan is in place, it is the responsibility of the Ministry of Transportation and Highways, and that if development takes place within that area, cost charges are not levied against the development. I've had that question for many years. I wonder if the minister might comment on any anticipated review of that.
Hon. A. Charbonneau: I take your point, and a point that another member made a while before, that there seems to be a lack of planning and regulation in the unorganized territories.
[ Page 6779 ]
Transportation has a role to play with respect to the transportation system. I have been arguing, as I have with respect to the approvals procedure, that it should be moved out of Transportation. I have spoken to and continue to speak to the Minister of Municipal Affairs about the fact that it ought to belong there or with the regional districts.
With respect to development cost charges, we don't have the authority to impose them. It might well be that you're making an argument that there should be a system set up to do that kind of regulation and to collect the development cost charges with proper land use planning in mind -- such that all of us save money in the end, and we have a better product out in our communities. I can't disagree with any of that, but there's nothing underway right now in terms of planning to precipitate that.
I can use the idea that I have been putting forward of moving the approvals office to a more appropriate location as a catalyst to trigger a larger discussion -- perhaps best carried out by Municipal Affairs in consultation with UBCM or whoever -- that these kinds of planning changes occur, but I don't think we will be a major player in that.
W. Hartley: I think that's something that I and others may wish to pursue, I guess through anticipated changes through regional planning and the Municipal Affairs ministry.
I have one other consideration that deals with highway planning in all areas, certainly in electoral areas. First, on behalf of my constituency, I want to congratulate the ministry for the maintenance and rehabilitation projects that are taking place at this time of restraint. But I have a real concern with regard to future highway planning. The minister is aware, I know, of a recent court case that involved a freeway in Maple Ridge. The justice ruled that the municipality didn't have the jurisdiction to show a highway route in its official community plan unless the province had committed funding to it. I'm also somewhat aware of the Transport 2021 project, which relies heavily on the ability of municipalities to recognize future transportation corridors in their official community plans. How does the minister see municipalities at this time dealing with some of the consequences of this decision? Do we need to be looking at some sort of legislation, respecting that there isn't the moneys available to allocate funding for projects at this time.
Hon. A. Charbonneau: I certainly do appreciate the situation that the member has alluded to. One of the major costs of transportation is land acquisition, and it seems such an enormous shame to me that we look at an area and we know that in five years or ten years -- or perhaps 15 years, if we're really doing our job -- a bridge or a freeway will be or ought to be located there. Yet we know that by the time we get around to building that freeway, the route will probably be littered with strip-malls and apartment buildings and service stations that we will have to purchase -- at great cost, at great penalty to the taxpayer in the long run, with great dislocation of businesses, of families, and with great pain and anguish. It could be done in a much more rational way. The Cottonwood corridor that Maple Ridge proposed to include in their community plan was a good idea. It laid it out that here was the corridor for the connection of a possible new bridge near Albion, and this is how it would connect into the existing system and on into what might be the northeast freeway. It was an excellent idea, and I went out to your community and defended it against considerable odds. I was disappointed that the justice ruled against Maple Ridge, saying that you can't reserve a corridor unless you are prepared to give a schedule for building the future infrastructure and the funding is in place to do so. Well, of course, we can't realistically fund and call out a schedule for something that might not occur for ten or 12 years. We know it will occur, but we don't know precisely when, and we certainly will not get funding out of Treasury Board for it. I would tie this, as you perhaps have by implication, to B.C. 21.
I have also argued long and hard, and will continue to argue long and hard, that we should be able to access the Crown land account, so that we can define corridors in partnership with communities. Then we can say to the citizens caught within the proposed corridor that if they wish to sell their property, we'll buy it right now. If they wish to stay on the land and live there for another eight or ten years and then sell it to us, we'll do that too. If they want to sell it to us and lease it back, we'll talk about that as well. The key thing is that we should be able to acquire those corridors in an orderly fashion now, when the development along it is of relatively low density. In the long run we could save the taxpayers of British Columbia hundreds of millions of dollars by so doing. We would also make those people's lives more orderly, and we would not have all the other dislocation that I have mentioned. It would not need to occur.
One thing I hope to be able to do through the Transportation Financing Authority, perhaps in conjunction with Crown lands, is establish a pool of money that could be used to purchase land as it becomes available. Because I certainly do understand, on the other side, if someone has some land and development ideas and yet is constrained from putting that into effect on the one hand, and unable to sell it on the other hand because the ministry doesn't have the money to buy it. We're in that situation all over the province in various areas. I would like to be able to access a pool of money to buy the lands in a logical, timely fashion and then subdivide, sell off the excess land and have the funds come back into the account. And as the roads are developed, let funds -- in a notional sense, at least -- come back into the account. If we see some improvement in value of some of that land in the process, that's fine with me, but let that money come back into the account. Let the increased value come back such that we can, on a continuous basis, be drawing from the account to purchase land for requirements and needs another five years out. That capability simply does not exist right now. I'm arguing that it should exist, and B.C. 21, or the Transportation Financing Authority, is one possible vehicle for that.
[5:30]
[ Page 6780 ]
A. Cowie: I take it, Mr. Chair, that we have a few more minutes. I want to, for one, support what the minister just said. I often wondered why the government and the Minister of Highways wasn't more aggressive at buying and selling land according to some recognized public plan. We've often seen places where it would be very easy to buy land, rezone it to some higher density, sell it back and actually make enough money to pay for the right-of-way through. The government seemed absolutely stymied and not able to do it in the past, so you would certainly get my support on this. Whether it goes through your B.C. fund is another matter, but the principle is a good one. It's a good planning principle.
I wanted to get back to subdivision. I'm glad to see the minister is thinking of shifting it over to Municipal Affairs, which would probably be the best place, or to regional areas. I'll give you a couple of examples. On the way to Whistler, there's Black Tusk and Pinecrest. There is a big difference in these two. I believe one is a bare-land strata, but it's a subdivision; it's one lot against the other. The other one is a bare-land strata in more of a cooperative corporation, so it goes through a different system. The subdivision goes through Highways for approval. It has wide roads, and it's all paved. It looks like a standard subdivision to some extent. The other one looks like a recreation or resort development. It has narrow roads and gravel roads. The two are very different. Both are really resort-type communities or, I would hope, meant to be.
If the minister is going to go in this new direction, I think it will help to alleviate that problem, because your technical people have to go by the standards they've got. Again I would ask the minister to comment on the appropriateness of the present standards when it comes to recreation.
In the Gulf Islands, for instance, you have very sensitive lands -- rock outcrops and all that sort of thing. If you follow the highway standards, you have to have a 66-foot right-of-way and wide roads. In many cases it absolutely decimates the land and gives it completely the wrong character to what it should be.
I was just wondering if the minister has any comments. That is something which I have personally fought for a long time and have not been able to stop. Perhaps now we have a more enlightened minister.
Hon. A. Charbonneau: First, I'd like to thank you for your support on the Crown lands account and from the rational approach for land acquisition well out in advance. I fully expect to see you standing in your place in the House when it comes time to vote on that issue.
With respect to standards, I share the concern and am pleased to point out that the ministry is actually a step or two ahead. We struck an agreement with the Islands Trust to revisit the standards on the Gulf Islands, because it doesn't make sense to build runways through properties on the Gulf Islands. If the folks there want twisty roads that have some ups and downs because they fit in with the character of the islands, that's fine. We have changed our maintenance standards, our brushing standards and our clearing standards to meet that, all through negotiation with the Islands Trust, and I signed an accord with them. I'm looking to do something similar in some other recreational areas. It might well be that in parts of the Kootenays, for example, they would like to stay away from the straight 66-foot, clear-the-forests-back approach. They want something a little different that fits in with the lifestyle. I think that we should listen to them. I feel it's not only smart from the point of view of listening to people and giving them what they sensibly want, but we save money to boot. It's far easier to make improvements on existing alignments, and perhaps add cycling paths and other amenities, than it is to go in and start moving dirt and blasting rock and cutting down trees. They don't want it; I don't want it. We've come to that understanding.
A. Cowie: Mr. Chair, this minister is showing too much enlightenment and progress. I can't take it any more. So I'm going to move that the committee rise, report progress and ask leave to sit again.
Motion approved.
The Committee rose at 5:36 p.m.
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