1994 Legislative Session: 3rd Session, 35th Parliament
HANSARD
The following electronic version is for informational purposes only.
The printed version remains the official version.
(Hansard)
WEDNESDAY, MARCH 23, 1994
Afternoon Sitting
Volume 13, Number 11
[ Page 9567 ]
The House met at 2:04 p.m.
Prayers.
D. Lovick: It's my pleasure, Mr. Speaker, to introduce two of your constituents. Joining us in the gallery today are Mr. Rob Watt and Ms. Jennifer Murdock, and I would ask my colleagues to please join me in making them welcome.
K. Jones: I have the pleasure of introducing to the House a gentleman farmer visiting us from Anahim Lake, which is between Williams Lake and Bella Coola. He was a resident and businessman in Victoria for several years before leaving for the north three years ago. Would the House please join me in welcoming Mr. John McCarvill.
B. Jones: It's my pleasure today to introduce my two favourite British Columbians: my wife and my son, Jennifer Jones and Emery Jones. Would members please make them welcome.
G. Farrell-Collins: I ask the House to make welcome 40 grade 11 students from Credo Christian High in the riding of Fort Langley-Aldergrove. They are here today with their teacher, Mr. De Jong. Would the House make them very welcome.
F. Garden: I would like to introduce two constituents of mine from Quesnel, Mr. Om Dut Keram and Mrs. Satya Keram. Accompanying them from Victoria is Mr. Keram's father, Mr. Rulia Ram Keram, who is 83, and Mr. Mukand Pallan. Would the House please make them welcome.
R. Chisholm: It gives me great pleasure to introduce to the House Mr. and Mrs. Steinson of Chilliwack. Mr. Steinson is a councillor with the City of Chilliwack. This is also the second introduction of Randy Lendout and Henry Klop, who are visiting the Legislature today. Would you make them most welcome.
G. Wilson: I have the pleasure to introduce two members from my riding who are here today. The first is Joyce McMillan from Sechelt. The second is my son, Matthew, who is here to take advantage of the good weather and try to beat his dad at tennis. I'm glad to say that he hasn't quite been able to do that yet, but with a couple more weeks of practice, I'm sure I will find myself on the receiving end rather than the giving end.
J. Pullinger: It's my pleasure to introduce two good friends and constituents who are with us in the gallery today: Ms. Bev Campbell and Trudy Thorgierson. I would ask the House to make them very welcome.
C. Serwa: On behalf of the member for Yale-Lillooet, I would like to introduce a very good friend, Chris O'Connor, from Lytton. He is accompanied by his wife, Denise, and daughter, Sarah. Chris is the woodlands manager for Lytton Lumber Ltd. and was very active in bringing the Canyon Power cogeneration project to fruition. Would hon. members please welcome Chris and his family.
M. de Jong: In the gallery today are two friends of mine, George and Sylvia Peary. Mr. Peary is a councillor with the district of Matsqui and also the new director of the Clearbrook Technology Centre, an innovation in education that we're awfully proud of. Both of them have had a profound effect on my life and must take much of the blame for me being in this place today. Please make them welcome.
J. Beattie: We have visitors today from the second-most-beautiful part of Canada. In the chamber are Esther and Paul Dubec from St. John, New Brunswick. They're the aunt and uncle of my LA, Sherry Marshall. Would the chamber please make them welcome.
C. Evans: We have a couple of guests today from the most beautiful part of Canada, the Kootenays: Sheila Haegendorn of Nelson and Sandy Korman. Sandy Korman used to be an artist, but with cutbacks to the arts, she has had to work for me.
E. Conroy: I know that these people are reluctant to be introduced, so I'll make it short and simple. I'd like the House to welcome the Rebalkins from beautiful Thrums, British Columbia.
D. Symons: It's an honour today to introduce a young man who's here to see what his grosspa does in this place. Would the House please make Jeffrey Symons welcome.
L. Hanson: I want to introduce a friend, an ex-MLA and a room-mate of mine for a number of years during the previous government, Bruce Strachan from Prince George. He has now joined that much feared and maligned group, the media. Would the House please make him welcome.
R. Chisholm presented a bill intituled Family Day Act.
R. Chisholm: Hon. Speaker, 1994 is the United Nations Year of the Family, and it gives me great pleasure to present a bill that celebrates the family. This bill is designed to ameliorate the lives of all British Columbians at a time when juvenile delinquency is on the rise. The family unit has metamorphosed, and financial obligations often detract from quality time spent together as a family. It is imperative that we acknowledge the importance of family life. A day spent in celebration of the family can only increase our awareness and our quality of life. I know that the values our pioneers built this province on had to do with the home and the family. As we get into the speed of modern society, we forget about the foundations that helped us to build such a magnificent province.
I'm looking forward to seeing communities across British Columbia make Family Day an important part of our tradition in the future. It should be noted that Alberta has passed a similar act, which has had a positive impact on the quality of life in Alberta. I urge members to support this legislation.
Bill M212 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.
[ Page 9568 ]
B.C. HYDRO EXECUTIVE COMPENSATION
G. Campbell: My question is to the Premier. Last week people across the province of British Columbia were outraged to learn of the almost $1.2 million set aside as a pension fund for NDP stalwart and appointee, Mr. Marc Eliesen of B.C. Hydro. Today I have in my hand a document which shows that Mr. Eliesen was responsible for the termination of a senior executive at Hydro. When that took place, that senior executive's pension fund went up by over $1 million to $1.5 million. My question to the Premier is this: does the Premier condone these kinds of excessive pension funds being paid at B.C. Hydro?
Hon. M. Harcourt: One of the reasons why our government acted so quickly on the Korbin commission, why we have introduced the Public Sector Employers' Council and why I have introduced guidelines to deal with the compensation of executives -- with such things as pensions and perks -- right across the public sector is to make sure that the taxpayers of this province can see that we are competitive in attracting good people in the public sector, but that the pay and pensions are consistent across the public sector.
The Speaker: The Leader of the Official Opposition on a supplemental.
G. Campbell: In light of the Premier's desire to try to make government accountable, will he finally accept the opposition's demand that B.C. Hydro be brought forward to the Select Standing Committee on Crown Corporations so that Hydro and its actions will be accountable to the taxpayers and ratepayers of British Columbia?
[2:15]
Hon. M. Harcourt: I don't know why the Leader of the Opposition would only want to deal with B.C. Hydro. Our government wants to deal with the whole public sector. That includes the city of Vancouver, where the city manager is making more than the Deputy Minister of Health. That includes the GVRD. That includes bureaucracies that have doubled in size. That includes the whole public sector.
The Speaker: The final supplemental for the Leader of the Official Opposition.
G. Campbell: Unfortunately, the Premier continues to confuse competence with the patronage appointments of his political friends. It is important that the Premier understand that accountability means that all British Columbians get to peruse the books and the actions of every Crown corporation. We have asked for B.C. Hydro to be before the select standing committee. I repeat my question to the Premier: will he bring B.C. Hydro before the Select Standing Committee on Crown Corporations so that, at last, Hydro will be accountable for the kind of mismanagement that we've seen in the last few weeks?
Hon. M. Harcourt: We're going to make sure that all of the Crown corporations -- and that includes municipalities, regional districts, universities and public bodies -- are brought under public scrutiny. As a matter of fact, it also includes all operations of government, because this government introduced the toughest conflict-of-interest and freedom-of-information laws so that government is less secretive right across the province and throughout the public sector.
G. Farrell-Collins: What the public would like to see is less talk from this Premier and more action.
Hon. Speaker, it appears that the Liberal opposition has hit the mark with our questions regarding Mr. Eliesen's $1 million pension, because Mr. Eliesen has just threatened the Leader of the Official Opposition in writing with legal action with regard to the questions we've been asking in this House. Will the Premier please educate Mr. Eliesen and tell him that it is the job of the official opposition to hold him and any other government body accountable to the taxpayers of British Columbia?
The Speaker: A supplementary question from the member for Fort Langley-Aldergrove.
G. Farrell-Collins: We've seen intimidation by this government over the last little while. We've seen intimidation with the roadbuilders; we've seen intimidation with the Speaker; and now we're seeing intimidation with the opposition.
Hon. Speaker, my question to the Premier is: will he tell Mr. Eliesen that he's a member of the public service, and if he's not comfortable being accountable to the public, to get out of the public service?
The Speaker: Final supplementary, hon. member.
G. Farrell-Collins: I hope that if members of the NDP back bench get a chance to ask a question today they will do so, because we have a private member's bill from one of the members of the NDP that says: "Strategic lawsuits against public participation are lawsuits in which powerful and wealthy interests, typically in the form of a corporation, seek civil damages for criticisms expressed in a public forum." Will the Premier stand behind his own members, do what's right and tell Mr. Eliesen to stop this type of intimidation?
CASINO GAMBLING
H. de Jong: My question is to the Premier. In view of the development proposals called for by the Vancouver port authority, and should such a proposal include a Las Vegas-style gambling casino, would that proposal be within the laws presently in British Columbia?
The Speaker: The hon. member for Abbotsford on a supplemental.
H. de Jong: Seven years ago tomorrow, the now Minister of Municipal Affairs stated in this House that they would oppose any move to introduce casino gambling for other than non-profit organizations. Is the Premier still of that conviction?
Hon. M. Harcourt: The first question was highly hypothetical; the second one is welcome and very concrete. The answer is that I am opposed, because the Criminal Code does not allow for stand-alone, for-profit gambling casinos in this country. The gambling casinos in Canada -- in Montreal and Windsor, and the one in operation at Hotel Fort Garry in Manitoba -- are owned by the governments, and they have different arrangements as to who operates and who can manage them. I can assure the member that this government is going to follow, with very cautious and
[ Page 9569 ]
thorough due diligence, gambling issues, and whether people in British Columbia want to expand the $1.5 billion gaming industry that exists in lotteries, horse racing and others into these other areas. So we're going to do a thorough, cautious review of whether or not British Columbians want that extension of gambling.
The Speaker: The hon. member has a supplemental.
H. de Jong: A final supplemental, hon. Speaker. As I'm sure that this is a very sensitive issue for all British Columbians, will the Premier commit himself to putting this matter to a referendum of the people of British Columbia before changing the law?
Hon. M. Harcourt: That is, of course, a matter of future policy. But I can say that that is one of the options we will be examining -- after we have completed a thorough consultation with the people of this province about whether we want to extend the already extensive gaming industry here.
SALE OF GOVERNMENT AIR SERVICES ASSETS
K. Jones: My question is to the Premier. Last October the government signed a ten-year lease, at a million dollars a year, for the new government air terminal. How much is it going to cost us to get out of this lease?
Hon. R. Blencoe: The reason this government didn't go for the ownership of a hangar but rather for a lease was that we could always sublease. We will be doing that. I can assure the hon. member that winding down government air services by the decision that was made yesterday will save the taxpayers of British Columbia millions of dollars. That's what this government is serious about.
The Speaker: Supplementary, hon. member.
K. Jones: To the Premier again. A completely like-new jet was purchased last year. How much are B.C. taxpayers going to lose on this purchase?
Hon. R. Blencoe: We will achieve considerable money for the assets owned by government air services. We expect a return of $10 million to $12 million on the sale of the planes alone. The province will earn considerable money from selling these assets.
The Speaker: Final supplementary by the member.
K. Jones: Could the minister tell us how much he paid for that aircraft?
A. Warnke: And how much is he getting for it?
K. Jones: How much are you expecting to get for it?
Hon. R. Blencoe: I didn't personally buy the aircraft, hon. Speaker. Because I know that the member is very serious about these issues, I will return to the House with the exact amount in the very near future.
INTEREST RATES
D. Mitchell: I have a question for the Minister of Finance about some of the economic assumptions that her budget is based on. I'm wondering if the minister is comfortable with her forecast of Canadian interest rates declining to less than 4 percent when the bank rate set by the Bank of Canada yesterday, just prior to the introduction of her budget, rose to 5 percent. Can the minister tell us if she has calculated the impact that that kind of change would have on her $20 billion budget?
Hon. E. Cull: Hon. Speaker, yes, we have.
The Speaker: Supplementary, hon. member.
D. Mitchell: Mr. Speaker, most British Columbians who operate businesses or own businesses understand the impact that interest rates have on their businesses. A 1 percent difference in interest rates can mean a huge difference to a $20 billion budget. Our gross provincial debt is now at $27.4 billion. One percent of that is $274 million.
Can the minister commit today to this House that she will not use poor forecasting -- poor forecasting of interest rates in particular -- as an excuse if and when her budget fails to meet its objectives?
Hon. E. Cull: The forecasting at the Ministry of Finance last year was bang on in terms of the growth of the economy, and I want to assure all hon. members that when we have put together our budget forecast we have considered what might happen in the economy. We have considered interest rates, we have considered the risks of all of our forecasts, and we have taken a prudent and somewhat conservative estimate of our growth for next year.
The Speaker: Final supplementary, followed by the member for Matsqui.
D. Mitchell: The short-term trend, at least, on interest rates is rising, not falling as the minister has predicted. Likewise, I think the minister's prediction on inflation rates can be questioned, because it shows a decline from 2 percent to 1.8 percent. That's what she said in her budget yesterday. But Canadian inflation rates are predicted to be between 3 and 4 percent, and American inflation rates are now forecast at between 4 and 4.5 percent.
Is the minister confident that we can close ourselves off to the rest of the world, that we won't import inflation into our economy here in British Columbia, and that our budget that she presented yesterday isn't based upon very dangerous and very wishful thinking?
Hon. E. Cull: Our projected growth rate next year is 3.4 percent, and if you look at the other bodies that have looked at British Columbia's economy, you'll see that's toward the low end of the scale. The average increase forecast for our economy next year is 3.8 percent, and that includes bodies like the Conference Board, the Bank of Montreal, the Royal Bank and the B.C. Central Credit Union.
COST OF GOVERNMENT ADVERTISING
M. de Jong: A week after being first asked, will the Premier finally tell this House how much taxpayers' money he has approved to finance his NDP campaign of misinformation and propaganda?
[ Page 9570 ]
The Speaker: Hon. member, thank you. The bell terminates question period. Order, please. Please take your seat, hon. member.
Especially for the member just taking his seat, being new to the House, I commend the reading of standing orders 47 and 47(A) with respect to the confines of questions. I'm sure it will be of great assistance.
R. Chisholm: I have the honour to present a petition on behalf of some constituents of mine concerned about taxation. The petition reads: "Objection to Any Increased Taxation on Homemade Beer and Wine Products."
Hon. J. Pement tabled the 1993 annual report for ICBC.
F. Garden: I beg leave to make an introduction.
Leave granted.
F. Garden: I neglected to mention that in the gallery there are some other constituents from my riding: Sharon, Dick, Ben and Pat Vinge are here from Cariboo North. Will you make them welcome, please.
[2:30]
(continued)
F. Gingell: Mr. Speaker, there was a delightful photograph in the Times-Colonist of you this morning, sitting at the piano. Perhaps at the start of this budget speech, it would be appropriate for the rest of us members of this House to show our musical talent by joining in one chorus of the song that is on every British Columbian's lips today. Sixteen tons and what do you get? One year older and deeper in debt.
The Speaker: Order, hon. member. The Chair must intervene, with reluctance, but I hope that the hon. member is not imputing any improper motives to the Speaker because he plays the piano.
F. Gingell: Not at all, Mr. Speaker; I hold you in the highest regard.
It gives me pleasure to rise to respond to the third budget of this NDP government. I am reminded of the parable of the good Samaritan. A man was travelling from Jerusalem to Jericho when he was set upon by robbers and left for dead. The first person who came upon him was a priest who heard his cries, but passed by on the other side. The parallel is obvious. The traveller is the taxpayer of this province, and the robbers are the first two budgets of this government, which beat up the taxpayer and left him almost dead. The priest is this minister who ignores the taxpayer's cries for help and passes by on the other side, leaving him no better off.
In a nutshell, that summarizes this budget. It's a do-nothing budget which leaves the people of this province in almost the same state that sparked off such protests one year ago. What has changed in this budget? Nothing. Should we be happier that taxes continue to be exorbitant? Should we be happier that there is still no economic plan for the province? Should we be happier that spending is still rising? No, no, no. Three strikes. We wish you were out.
What is the job of the Minister of Finance? It is, first, to set the parameters of all spending: operating, debt servicing and capital. Secondly, it is to manage the province's finances: borrowing, servicing of the debt, payment of costs, collection of revenues and investment of trust funds. Thirdly, it is to determine how the necessary revenues will be raised to pay operating costs, service and retire the debt and fund capital expenditures. I know it sounds simplistic. The Minister of Finance will tell you that it's much more complicated than that, and I'm sure that it is. But those are the essentials.
So the first responsibility is to determine what the best measure of spending is. I suggest it is a percentage or portion of the gross provincial product. At the start of the 1980s, we spent almost 14 percent; in 1995 we plan to spend 22 percent. We have to get that percentage down. We simply can't afford it. The minister shouldn't determine how much is spent on K to 12, university buildings and tourism development. Instead, the minister should set firm expenditure limits, as determined by long-range and short-term targets.
On the revenue side, the minister has to determine how to best raise those revenues. What is the criterion? Clearly, it is to infringe as little as possible on good economic development. You mustn't have taxes that discourage job creation. You must know which taxes will be cut first, as total expenditures as a percentage of GDP drop. How can you do the least damage now, and what do you do in the future to do the greatest good?
I don't think that this Minister of Finance or her predecessor had any philosophical foundation for tax policy. They just search around for a new tax to raise more revenue or, where they can, increase an old tax, irrespective of the consequences. Theirs has been a policy of punishing the successful so that they can reward their friends. When they make a major boo-boo, they have to back off. We saw this with the property supertax, the jet fuel tax, no trade-in credit on car sales, the partial retreat on the corporate capital tax and the partial retreat on the homeowner grant clawback.
I never hear them talk about tax reform. I never hear them talk about developing a tax system that will not deter or discourage industrial expansion, economic development and, most importantly, job creation. Which taxes increase the costs of the goods we produce and make them uncompetitive in export markets and at home? Economic benefits are derived from competitive goods and services that have world markets. The taxes that flow from that job creation will far outstrip the taxes hidden in the costs of production. It is the multiplier effect of a manufacturing job that creates economic growth, reduces unemployment and improves the standard of living for all our citizens.
I hear them talking about renegotiating federal-provincial transfers. But I have never heard them call for the federal government and municipal governments to join with them to overhaul and reform our ineffective, inefficient, unwieldy and overcomplicated tax system. They should beencouraging their provincial counterparts to force the federal government to join them and regional and municipal governments in this long-overdue and important task.
Having said that, I'm going to focus my remarks on the revenue and financing side of this budget. I will make some broad comments on program expenditures, but my colleagues will deal with those issues in detail. My call on that issue is to reduce the expenditures -- operating, debt service and capital -- in a sensible but urgent manner until they are below 18 percent of gross provincial product. It's a difficult task, but you will never know if it can be achieved until you try.
[ Page 9571 ]
I want to do three things today. Firstly, I want to put this budget in the context of what has happened to the province's finances over the past few years -- specifically, the terrible increase in taxes, debt and spending. Secondly, I want to dispel some of the myths and make obvious the sleight of hand that attends this budget: a deficit that is really $1.2 billion, not $900 million as claimed; the myth of no tax increases, when there are increases; and the myth of controlled spending, when spending is out of control. Lastly, I want to talk about mismanagement and the lack of an economic plan to guide this province's growth.
First I have a few words about the budget process, which can be summed up as a disregard for this House. For the second time this week the Premier has shown his disregard for this House: first he fired the Speaker, and then he pre-empted the budget speech. Did the Minister of Finance notice the irony of the Premier's pre-empted budget address, or was she swept away by the packaged sincerity of the moment -- a powdered and panicked Premier reading his budget cue cards straight from the heart? Surely the minister noticed something missing from his performance. It's called democracy. The financial policies of a parliamentary government are to be presented and debated in this House first; they are not supposed to be leaked by a Premier on television. It was a shameful and pathetic attempt to give the Premier an aura of command. When will his communication advisers realize that you can't make a General Patton out of a Mr. Pickwick?
I was glad yesterday to hear the minister reiterate her thoughts on the last years of Social Credit in power. It was, as she said, a financial disaster; spending was out of control. Two years of 12 percent spending increases were clearly beyond the ability of the province's taxpayers to pay, and in opposition, the NDP said that very clearly. So when the NDP took power, did they take firm control of the purse strings, as they said they would? Do we have to tell you the answer? Unfortunately, no. To spending that they described as out of control in 1991, they added cost upon cost. What is the result? In the past five years government spending in British Columbia has increased from $13.3 billion per year to $20 billion, a 45 percent increase. To put that in perspective, it is almost double the rate of growth in the provincial economy.
Excluding interest on debt, B.C. has the largest per capita spending of any province in Canada. We spend more on programs, including welfare, than Newfoundland; 20 percent more per capita than the socialist government in Ontario; and 12 percent more than the national average. If we, a prosperous province, spent only what other provinces spend on a per capita basis, we would save well over $2 billion this year. We would run a surplus and would be retiring debt and looking for tax cuts.
Let's look at how this government spends our money: education, where higher wages on a stand-pat budget translate into a loss of quality in our schools; health, where we are spending more money to less avail and where there is no direction; a hundred new bureaucracies and an organizational chart that runs for pages and pages in its confusion. Money is swallowed up in that bureaucracy rather than spent on care.
The government has implemented many measures that cost us more for the services they provide. The fair wage policy drives up the cost of most capital projects and makes a mockery of the competitive bidding process. There has been a 24 percent increase in the wages paid to BCGEU members. This isn't controlling spending.
Finally, this government has wasted our money by not managing it well. According to the latest figures I have, the government has $2.5 billion of U.S. debt, which is unhedged in a market where the Canadian dollar has been falling. What is the loss? It's maybe $50 million to $100 million. Now we know why the Premier wants casinos in this province. He's been gambling with our money and losing it; now he wants one more roll of the dice.
Let's look at revenues. The amount of revenues -- be they taxes, royalties or Hydro dividends -- has increased from $13.5 billion in 1990 to $18.7 billion in 1994-95. That's an increase of almost 40 percent. Again, that's a much higher growth rate than the provincial economy -- 55 percent greater. This has simply meant that the provincial government is taking a larger and larger slice of the pie. We saw tremendous tax increases over the past two years in particular: property transfer taxes, sales taxes, corporate capital taxes, Hydro rates and property taxes -- the list goes on and on. The taxpayer is a little like a victim whose assailant continually returns to beat him, each time with a bigger stick. This year the government is asking us to be pleased because the size of the stick hasn't gotten much bigger -- but the deficit is still large: $1.2 billion.
The debt continues to grow. In 1990 we had a surplus. Our economy has grown since then. Taxes have gone through the roof, yet we have a huge deficit. Something is wrong, and the government does nothing. Our total debt has increased by $7.5 billion in that period; the debt continues to build. We are not as fortunate as some members of this House who can walk away from their debts by simply leaving their old party associations and name behind and name-napping a new one. These are the simple facts, and they condemn this government.
We have a debt crisis in this country and in this province. More importantly, we have a spending crisis. The deficit is simply the difference between spending and taxes, as we all know. But the solution is not to raise taxes, as this government has done during its mandate. That is the problem, and it has come home to roost. That is what, in the end, we are trying to avoid.
[2:45]
The financial problem of this government is simply that it's costing us too much -- whether we pay now or later, as happens when we run a deficit. The solution is that we have to spend less, not tax more. This is one of the most important differences between ourselves and the NDP. They want to raise taxes with the belief and attitude of: "What are you complaining about? You can afford it." The fallacy of this kind of thinking was shown in the property tax fiasco last year. The NDP are out of touch with the ordinary people of this province -- the wage earners, the small business men and the homemakers trying to make ends meet. Many people in this province have to count their dollars each month to get by. They put off purchases, cut back and vacation at home -- or not at all.
But this government blithely hikes rates, schedules tax increases, says they aren't taking any more -- when we all know they are -- and blandly spends our money on retreats, million-dollar salaries and pensions, and new office furnishings as if it's all okay. They won't get down to trimming spending so we have the assurance that every dollar going out is money well spent. People can't afford it any more; they need taxation relief.
I now turn to some of the myths that the government is propagating about this budget. First and foremost is the premise that there are no new taxes. They have also made a promise that there will be no new taxes over the remainder of their time in office. This was exactly the promise the Premier made in 1991 before taking office: no new taxes. Instead, we have had two budgets with the largest tax
[ Page 9572 ]
increases in B.C.'s history. If past performance is any guide, this government's promise of no new taxes bodes ill indeed for the citizens of this province. How can we be expected to believe this promise?
The government has said that it has frozen taxes. Then why will individuals pay an additional $105 million in the new personal income tax surcharge, effective January 1, 1994? This is a 1.5 percent to 3 percent surcharge on all income over a threshold amount. This is a new tax in 1994, announced last year but effective this year. Is the government going to be true to its word of no new taxes and roll back this increase? Or will we have new taxes in 1994? The minister, I suggest, has selective amnesia on this matter.
As I outlined yesterday, most of the members of this government believe that increases in fees, licences and hydro rates are simply taxes under another name. The House has agreed on that. Do we have no new fee increases as is implied? No. Do we have no new rate increases from Crown utilities, whose profits are funnelled into provincial coffers? Have you looked at your hydro bill lately? All the excess profits of Hydro which aren't spent on executive salaries and office renovations are eventually sent to the provincial government as revenues. If taxes are frozen, why is the government budgeting on and taking an additional $360 million from the pay packets of individuals in this province -- over $200 per person from each member of the workforce?
There is more. Change in the property tax regime is still rippling through the system, resulting in larger assessments on property taxes this year. The provincial government is piggybacking on the changes in income tax enacted in Ottawa in this year's budget. Some of the taxes raised as a result of eliminating the capital gains exemption will end up in Victoria as new tax revenues for the province.
The end result is not pretty. According to Peat Marwick Thorne, British Columbia has the highest marginal tax rate in Canada.
An Hon. Member: Shocking!
F. Gingell: That is shocking for such a prosperous province.
Let's look at some of the other revenue figures. In addition, we have delayed taxes. At some point, we are going to have to pay for all of our spending, and the shortfalls in revenues will have to be made up. Every increase in spending has to be matched by an increase in taxes, whether we pay now or later. This year we have $1.2 billion of delayed taxes that will be passed on to future years -- the legacy of an NDP government.
I also want to revisit some of the tax rollbacks. Let's examine the automobile industry. The government's disastrous policy of last year should make them ashamed. They introduced a tax that was so bad and so poorly conceived that it actually reduced provincial tax revenues by shutting down economic activity and driving people -- if you'll excuse the pun -- underground. No wonder they are reversing that stand on this tax -- an admission of incompetence in one short year. What has been the cost of this kind of ineptitude to the economy? The people of the province can't afford to be the unwilling guinea pigs in failed socialist experiments. Do your learning somewhere else.
We in opposition take some consolation from the fact that we have been recommending some measures for some time now. Take the rest of our advice: please scrap the corporate capital tax, the biggest deterrent to investment in the province.
First of all, the deficit is $1.2 billion, not $900 million, as the budget claims. This is the result of hiding some expenditures by keeping them off the books -- a favourite trick of the Socreds, which was roundly criticized by the NDP in opposition. Now as government they somehow want us to think that a $300 million expenditure in roadbuilding activities doesn't count. We have to pay for it; it counts.
Then there are the little tricks that are so infuriating, like this year's pension adjustment. When the news was bad, as it was in 1992, this government charged $455 million in unfunded pension liabilities to a prior year. They did a new estimation this year, and the news was good. They found that they had overprovided. So what did they do? Did they adjust it back to the 1991 year? Of course not. They said it was part of this year's good news, and they included it in this year's results. A small hypocrisy maybe, but it's indicative of the kind of truth in advertising that we have come to expect from this government.
Let me now turn to the third major failure of this budget: the lack of planning and the lack of a strategy for the provincial economy; in short, the lack of economic leadership. The province has prospered in the last year compared to the rest of the country. This government would have us believe that they are due the credit for this, but economic growth in the province is not because of them but in spite of them. It is being driven by interest rates and higher lumber prices. These are decided externally, on world markets. There has been little in the way of overall productivity increases, nothing to enhance our competitive position in world markets, no economic strategy and no vision for the future. Nothing.
Where are the results of the Premier's extravagant missions abroad? What is Mark Rose, the province's agent general in London, doing besides sipping tea with renovators at Harrods? Other governments aren't like this one -- lost sheep wandering in the fog. Other governments have economic strategies. They entice businesses. Our rivals in Washington, Oregon, Korea and Taiwan have positive tax regimes, strong economic climates and governments that encourage businesses. What do we have? Corporate capital taxes that scare away investors, personal income tax surcharges and burgeoning red tape. The result is that investment is drying up, and we have an economy that this government admits will lag behind the rest of Canada this coming year. I've talked....
Interjection.
F. Gingell: It's in your own budget report. Look at it.
I have talked to many businessmen over the past months, and from their view the horizon is not unclouded. Interest rates are rising; commodity prices for minerals and pulp continue to be low. This government goes on blithely spending our money. What has this government done in key sectors of our economy?
Let's look at mining. Exploration is down 80 percent since this government took office. Hundreds of millions of exploration dollars have been lost or are flying out to other locations. There is increased regulation and a climate that makes miners now despair of opening a new mine in the province to replace those mines whose ore bodies are depleted. What has the government done to revitalize this industry that they don't understand and whose prospects they have destroyed? Their response has been incompetent. They have thrown the industry a bone, and that's all.
Forestry is the backbone of this province. What has this government done for forestry? It has reduced the harvest,
[ Page 9573 ]
lost jobs, offered only platitudes about assistance and introduced up to $1.5 billion of compliance costs under the new Forest Practices Code. What has the government done for this industry? They have no excuse for not knowing, because there were 25,000 people on the legislative lawn two days ago telling them what they've done to this industry.
What has the government done for the finances of this province? These are relatively prosperous times, and it is no wonder that tax hikes are less severe than in past years, but these are the times that government should be saving for a rainy day, not just holding the line. We are prosperous, they say, but expenditures still exceed revenues. We have windfall stumpage fees, yes, but we've spent it all and then some. Any household that gets a wage increase and a bonus in their income one year and still spends more than their income on rent and groceries is in trouble. If they don't recognize it, they are foolishly deluded and headed for a fall. This government is leading the province down that path. These are good times, but there are still massive deficits. In prior years, when times were good, the province was able to put funds aside to balance the bad years that they knew would surely come. This was the essence of the Premier's promise to balance the budget over the business cycle -- another promise that has been abandoned by the Premier.
We have one of our largest deficits ever. Since our last budgetary surplus, the economy has grown by 25 percent. New taxes have been introduced and tax rates have been increased. Government revenues have increased by 45 percent. Inflation has been virtually nil. But what is the state of our provincial finances in good times, given these tax grabs? It's as bad as it's ever been, no better; just in these fortuitous circumstances, no worse. The government crows over all this and tells us what a good job they are doing.
[3:00]
And to end, we come to the last page of the budget book, page 88. As I said yesterday, you have to get to the last page to complete the story. We have to deal with the sleight of hand that has taken place. The minister has been talking about paying for groceries out of current income and not deferring it on a credit card, and about taking out a mortgage to pay for capital assets. But what have they done? They have sold a capital asset, the B.C. Endowment Fund, and used it to pay for groceries when it should have been applied against the mortgage. I'm going to adjust that to include the B.C. Transportation Financing Authority, so that comparisons are fair and consistent. To be immune from criticism, I'm going to compare it to March 31, 1992, not five months earlier in the midst of the largest budget deficit ever, when this government took control of the ship.
The operating debt will have increased from $6.61 billion to $11.367 billion, an increase of 66 percent, and tax-supported debt from $3.488 billion to $7.968 billion, an increase of 128 percent. Together, over three years, it is an increase of 91.5 percent. When we add it to the province's so-called commercial debt, it's $7,500 per person, or $30,000 for a family of four. How do you think the people on the legislative steps on Monday, who are concerned about job security, feel about you increasing their debt?
Some words of caution for the Minister of Finance about her rosy hyperbole. Yesterday the Dominion Bond Rating Service downgraded Canada's foreign and foreign-currency debt from AAA to AA+. Can ours be far behind? That will increase interest costs for this government. The prime rate went up half a percent. What's half a percent on $27.5 billion? It's a little over $137 million. The minister's economic assumptions use the Canadian dollar at over 75 cents U.S. This morning, the Canadian dollar was just over 73 cents U.S. You have, according to the recently published public accounts, $2.5 billion in unhedged U.S.-dollar debt.
Lastly, on the subject of debt, the debt you so comfortably describe as self-supporting Ontario Hydro, that once proud major utility -- I didn't want to remind the government of Mr. Eliesen; they have enough troubles to worry them without that -- is now subject to closures, layoffs and exorbitant rate hikes. The world can change, and surprisingly quickly sometimes.
My history tells me that about 1,000 years ago the Norsemen, led by Ragner Lodbruk, raided Britain every summer in regular fashion. They extracted tribute in ever-increasing amounts. They pillaged Lindisfarne one year and plundered Iona in another. Some years they didn't bother coming back, not because of any goodwill but because they had already burned the country and taken all they could. But they demanded tribute, and tribute had already been agreed upon. Messengers came and took the Danegeld back each year.
Did the people of Britain count themselves fortunate? Did they love the Norsemen? Were they grateful for the threat of rape and pillage being suspended? The people of British Columbia feel the same way about this government and this budget.
J. Weisgerber: It is my pleasure today to respond to the third NDP budget. It's unfortunate that the Minister of Finance can't be here today, because I was going to start by complimenting her on a number of changes introduced with this year's budget. I would have -- and will -- recognize that all of those changes are reversals of programs and policies brought in by the NDP. I suppose that's a backhanded criticism of the former Minister of Finance and the government in its early years in office. But I did think, for example, that the reintroduction of the sales tax credit on automobiles was an important step forward -- a recognition, indeed, that last year's budget was a disaster.
I was happy to see that that silly Energy Commission, which has been stumbling around the province for a couple of years, has finally been put out of its misery. Unfortunately it spent $2 million of taxpayers' money in that exercise, and we understand it's going to cost another $1 million to wind it down. But at least it's out of its misery. At least we don't have to put up with that anymore.
I think also it's important to recognize that the government was courageous in dealing with government air services. I think it's an issue whose time has come. I believe there are other ways that government can accomplish its business, and it doesn't need a fleet of jet aircraft. Why in the world the government, while contemplating that, would have had a brand-new hangar built and then leased it for ten years, is a bit hard to understand. The Minister of Government Services said that he leased it rather than had it built because then they could sublease it. With that kind of leadership, the next couple of years don't look very bright -- very much like the minister in question, I suppose.
But what I want to get to are the really important parts of this budget. This budget is primarily a budget dedicated to concealing debt. It's a budget that fails to recognize the need to cut the size of government, fails to recognize that British Columbians want less government, less expensive government and smaller government. Indeed, they didn't get that. They got a government that's growing instead, a government that's becoming more expensive, a government with a much larger budget. Indeed, it's a government that is, most importantly, adding critical amounts of debt to our
[ Page 9574 ]
already accumulated debt. This year the government has to borrow $2 billion more simply to carry on its operations.
Even after selling off a benefit, an asset, the so-called Endowment Fund, first called the B.C. privatization fund -- money that was accumulated when highways maintenance was privatized; assets that were sold and put into a fund -- government is now using that money and pretending somehow that it reduces the borrowing needs of the province. The money should have been applied to the accumulated debt. The assets were accumulated over time, the debt was accumulated over time, and the only fair and honourable way to have dealt with those assets was, if they couldn't manage the fund....
It seems like that Endowment Fund got them into more trouble than they wanted to put up with. The purchase of shares of MacMillan Bloedel was one example of their astute money management, just before they went to Clayoquot. Then there was the genius that saw them invest in VLC at the time that corporation was preparing to apply for a major casino licence. The government in both of those cases tried desperately to bail out of those purchases in a way that left them with some shred of dignity.
So the government decided instead that they're going to do away with the fund. The fund, I think, could have been managed to earn a better return on investment than the government is able to borrow funds at so that there would have been an opportunity to leave the fund in place and bring the earnings of the corporation into revenue. But the government decided to get rid of it. It should have applied the proceeds to the accumulated debt.
That aside, this year we are going to be $2 billion further in debt than we were last year. That relates to a per capita debt increase that now amounts to $7,800 for every man, woman and child in British Columbia -- $2,000 more per person than when the NDP took office. That seems to be decades ago, but it was only a bit more than two years ago. If that were the only problem.... While we were going into debt by another $2,000 per person, we were also looking at an annual tax increase that amounts to $2,000 for every individual in the province. British Columbians are disappointed. They are angry about these tax increases.
An Hon. Member: Do your numbers.
J. Weisgerber: Hon. members across the way pooh-pooh these suggestions, as they so often do. If they don't believe that British Columbians are angry about tax increases and debt, how in the world do they rationalize their pathetic standing in the public opinion polls? Do they blame it on the Premier? Is it the fact that the Premier himself is unpopular? There has to be some reason. I believe that it's because British Columbians understand precisely the mess that this government has made of the finances of this province over the last two years. The government's popularity is in rapid decline as a result of mismanagement.
If you look at the total tax take in British Columbia this year, you will find that it represents $13,600 a family. So British Columbians who perhaps haven't had a salary increase over the last year or two, or had a small salary increase but somehow the money doesn't seem to be going quite as far as it used to -- the take-home paycheque is a bit smaller than it used to be or perhaps substantially smaller than it used to be -- look at the income tax deduction section. The tax activity by this NDP government is reducing the spending power and discretionary income of British Columbians. Over the term of this government, since 1991, taxes have increased by $4 billion, and 61 percent of that comes from direct taxation.
[3:15]
In addition, there have been hidden taxes. B.C. Hydro rate increases are turned into dividends. ICBC rate increases are used to repair road intersections that used to be paid for by the Ministry of Transportation and Highways, but that is now somehow camouflaged under accident frequency reduction plans -- if you can imagine. The government doesn't fix the roads now; they wait until there are enough accidents at an intersection and then they get ICBC to pay for that. We didn't hear any commitment yesterday that ICBC rates won't go up. We didn't hear any commitment about insurance rates, and believe me, there was a very good reason for that. We didn't hear any promise to fix hydro rates. We know that there's a plan in place to increase hydro rates at 2 percent greater than the inflation rate, a rate that over the five years leading up to this government's election would have increased hydro rates by 40 percent, when indeed the utilities commission of the day only allowed rate increases of 10 percent over that period. Those are the kinds of actions that British Columbians are sick and tired of and are speaking out on. And British Columbians can't wait for the big opportunity to speak out.
The way things look, the government will probably be here for another 18 months. I doubt whether they will be able to screw up the courage 18 months from now to face the people, but two and a half years from now the Lieutenant-Governor will resolve that problem for them. We can't have to wait more than another two and a half years. Looking at the record of this government over the last two and half years, we wonder whether we're in for and should be prepared for the same kind of economic disaster that's plagued us over the last two years.
With debt rising by $2 billion or more a year and taxes going up by $2 billion or more a year -- $4 billion more a year in government expenditures -- one has to ask where in the world has the money gone. It's gone to three primary purposes: first, it's gone to wages; second, it's gone to interest; finally, it's gone to welfare. Those are the three areas where this government has spent most of its $4 billion a year in increased expenditures: welfare, wages and interest. If the government were to deal seriously with wage costs -- the size of government, the number of people working for government and the wages paid to those people -- and if they were to deal seriously with the question of welfare abuse, then they could start to deal with the problem of interest. The interest issue can only be resolved once this government gets its spending priorities in order.
Over this government's first two years we've seen 3,500 new bureaucrats on the payroll. This budget suggests that there are going to be another thousand added this year. Government is growing much too quickly. Government shouldn't be growing at all. What British Columbians want to see is a government reducing its size, becoming less expensive and less intrusive into their lives. That's what British Columbians want, and that's what this government fails to hear. This government continues to ignore the signals that it's getting.
Let's look more closely at this question of wages. That's a key issue that this government will never have the courage to deal with. This government will never have the courage to come to grips with the question of public sector wages. The government has increased direct spending on salaries and benefits by $400 million a year. Sixty-five percent of total health care costs go directly to salaries and benefits. Over the last two years, health care spending in British Columbia has increase by $900 million. That means that there is $600
[ Page 9575 ]
million more being spent on wages and salaries for health care workers than when this government took office. We heard last year of a master plan that was going to reduce the number of health care workers and reduce their hours to 35 per week. Attrition was going to cause a large reduction in the number of health care workers. The government wasn't going to cause any pain to those health care workers; they were going to ensure that even if they worked fewer hours, they were going to have the same net take-home pay. Guess what happened? The government reduced the number of hours and increased the hourly wage, and people didn't resign in numbers. Indeed, people understood that they had to hang on to their jobs, because there wouldn't be an opportunity to come back into the workforce. Women who might have gone out of the health care field for a year or two, perhaps to have a child....
Interjection.
J. Weisgerber: The member across the way says: "Why just women?" First of all, quite often women who are at the age of raising a family are desirous of moving out of the workforce and back in, and most health care workers are women. But the government didn't understand that, so they have now put those women and men in the position of not being able to move out of the workforce for a year or two and then move back in. The net result has been that the same number of people are working in the system, working fewer hours and making the same wage. It was a miserable failure, engineered by the now Minister of Employment and Investment. Perhaps that's how he got the job. They figured if he could increase employment at that rate, cut the kind of contracts that would see people work less and be paid more and keep more of them in the workforce, that would be something worthwhile to try to achieve.
The situation is not at all different in the education field. Salaries and benefits take up 80 percent of education costs. Education costs under this government are up $800 million, which suggests that another $600 million in education has been dedicated to wages and benefits. In other words, the government has spent another $1.6 billion directly on wages and benefits: $400 million in the public service, $500 million in education and $600 million in health care.
The solution seems quite clear. The government should and must put on a wage freeze. Indeed, it should go further than that. It should roll back salaries and wages for anyone making more than $40,000 a year. It should start right here in this chamber -- from MLAs, the public service and Crown corporations. Let's roll back wages 5 percent. We don't have to lay off a whole bunch of people. If that sounds unacceptable to the members across the way, have a look at what's happening in the private sector. Look at the contracts that are being signed by unionized workers. Look at the people who understand the reality of the world today. People in the private sector understand that there is a limited amount of money available. They also recognize that there are a couple of ways to deal with that. Those with seniority hang on and let the others go their own way, or they can rationally decide to roll back salaries. Government should consider that. I'm convinced that this government never will, and I put it out there simply as an option for the next election, because that's certainly a program that I will be pursuing. It's one that British Columbians will embrace.
We see not only wages and salary expenditures in education, health care and the public service, but we've also had a stroke of brilliance from the government with its fixed-wage policy -- more commonly referred to in government circles as the fair wage policy. By every account it cost the taxpayers at least $100 million -- and more likely $200 million -- and was a total failure in terms of the government's agenda. It didn't do anything for anybody, other than increase the cost of publicly funded projects.
We've moved from those kinds of issues to $2.5 million for the new Public Sector Employers' Council; $1.6 million of that for salaries for hacks like Linda Baker and others out of the Premier's office who are supposed to reduce public sector wage costs. This is the mind-set of this government: set up a public sector employers' council, fund it for $2.5 million, and give $1.6 million to bureaucrats to tell them how to reduce public sector wage costs. People like Linda Baker, making in excess of $100,000 a year, are going to give good advice to the government on how to bring down public sector wage costs.
We have something else called the public sector and public service human resource management branch. Last year they had an increase in budget from $9.4 million to $12.5 million, a 33 percent increase to a group, to advise government how to better manage the public service. Those folks know how to manage the public service, just like Linda Baker knows how to manage the public service, as well as those people the government puts in place, like Mr. Gathercole with his Energy Council. "Gather Salary" would probably have been the best title and the most appropriate name. Wages are a serious problem. There is a solution. The government could deal with it but probably won't.
[D. Lovick in the chair.]
Welfare was an issue discussed in this chamber for a good part of the last session of the Legislature. One minister failed to deal with that and found herself moved off to browner pastures -- if not greener pastures. This is because welfare spending in British Columbia has grown by $800 million under this government -- a 66 percent increase in budgets in only three years. One out of every ten British Columbians is now on welfare, six out of ten single parents are on welfare, one out of eight children in British Columbia is dependent upon welfare, and one-third of all the people on welfare are single, employable men. This is a serious problem this government has refused to address. I think it's because the members believe that those one in ten British Columbians represent an electorate constituency for the government, and the government is therefore unwilling to deal with those problems in a realistic and meaningful way.
There are some other curious items in the budget. Thirteen of 19 ministry budgets have been increased -- the Premier, on a percentage basis, by far the biggest winner -- as well as another $100,000 for staffing in the Premier's office. This is downsizing; this is controlling the size of government. Indeed, the other big winner, if spending more taxpayers' money is being a winner, is the Minister of Skills, Training and Labour. I think he really believes he is. He's clapping the desk; he feels pretty good about that. The next winner is the Minister of Municipal Affairs, and finally there is the Minister of Employment and Investment.
[3:30]
British Columbians don't want government investing money in business. They want their government to create an economic climate that will allow business to flourish on its own. There's no shortage of capital in British Columbia, in Canada or in the world. What there is is a shortage of confidence in the economy of British Columbia because of the actions of the current government. That's the problem. The easiest way to resolve that is to re-instil some confidence
[ Page 9576 ]
in the business community and get rid of that silly corporation capital tax. The government has now fiddled around with it and raised it by a tiny percentage, as if anybody -- on the inside, at least -- would be misled or fooled the least bit by that kind of tinkering. The business community wants to get rid of the corporation capital tax. They don't want the limit moved from $1.25 million to $1.5 million.
Interjections.
J. Weisgerber: Indeed, hon. Speaker, as entertaining as the talk is, the government's going to spend another $3.2 million on public information. Read that as "propaganda," because that's how everybody else reads and understands it. The nerve centre for propaganda in the government, the government communications office, is getting another $100,000 for salaries. This is government taking a tough line on salary increases. But everywhere you look, there's more, more, more -- bigger salary increases and more bureaucracy.
The Ministry of Women's Equality is getting a budget this year of $203 million; that's up from $20 million two years ago. Imagine that -- a tenfold increase in budget. Can anyone tell us what the Ministry of Women's Equality has done for British Columbians? I think, hon. Speaker, that you would be hard-pressed to find anybody in British Columbia who could answer that question for you.
The Ministry of Aboriginal Affairs had an 80 percent increase in funding over last year's budget. Funding for treaty negotiations will be tripled to more than $9 million.
The sad truth is that the government, through its budget, has deliberately tried to mislead British Columbians about spending, about debt, about the size of government, about the size of the deficit and about the accumulated deficit of government. The government has deliberately tried to paint a picture that is altogether different than the harsh and sad reality that exists in British Columbia today. The government had within its power the ability to deal with most of these problems. The government was faced with an opportunity, after two years of enormous tax increases and some windfall profits in the area of forestry stumpage, to have balanced the budget this year in a genuine way, not by budgeting and borrowing $2 billion off-budget or with the kind of chicanery we see with B.C. 21 and the capitalization of highway construction. This government has, and had, in its power the ability to balance the budget and start to deal with the accumulated deficit, but the timing wasn't right for them. The government wanted to delay that. In the final hours before its next election, it tried to cobble something together in a way that didn't offend their traditional supporters. We'll see something that looks like a balanced budget on the surface but that adds another $2 billion or $3 billion to the accumulated debt.
I see that my time is fast running out. Let me say that there is a solution. Get rid of the patronage posts. Do a review of all redundant boards, agencies and commissions. Tackle wages and welfare expenditures. Impose an across-the-board 5 percent cut in public sector wages over $40,000. Pass a law that would limit severance pay to any public sector worker at an amount no greater than eight months' salary. Hourly workers and people working in middle management are limited to eight months' severance. Why should senior bureaucrats be getting million-dollar settlements when they get fired? Pass a law to limit the amount of severance that can be claimed. In order to show that you really mean that and believe in it, get rid of the MLA severance package.
I see that my time is running out. I would like to conclude at this point.
Deputy Speaker: I thank the minister very kindly for his comments. The Chair now recognizes the hon. Minister of Skills, Training and Labour in response to the budget speech.
An Hon. Member: The minister of defence.
Hon. D. Miller: Defence? I'm appalled.
I'm pleased to rise again in this new parliament to talk about what I consider to be one of the better budgets that has ever been introduced in the history of this province.
I must say that I am constantly amazed in this business when I listen to what I consider to be fundamental contradictions. We always get the people on the right.... My hon. friend from Peace River South, who's now the leader of the B.C. Reform Party, may be wandering in the wilderness a little bit. We'll wait to see where he lands. I'm not certain that, for all the rhetoric, his leader in Ottawa has ever taken a wage cut; I don't think he has. The leader of the federal Reform Party talks the talk, but when it came time to take a cut in his own salary -- which is far greater than $40,000, my friend -- he didn't do it.
The message is that you've got to do more than simply talk about what people should do; you've got to start setting some examples. This government froze the wages of MLAs. We're on the second year of a 5 percent cut in cabinet ministers' salaries. When that hon. member was in cabinet -- he was on this side not long ago, and I was on that side -- I didn't see him advocating what he's advocating now. I wonder at the change. I wonder at the right-wing rhetoric that talks about cuts, cuts, cuts. Yet when we look at the federal level, what did the right-wing Tories leave us in terms of a deficit? It was $45 billion. It's hollow rhetoric.
Again, my friend who was a member of the cabinet of the last government talks about wage cuts. He talks about controlling spending. Theirs was a government that had the greatest increases in government spending in the history of this province. Theirs was a government that negotiated a contract with one group of public sector employees for four annual increases of 7 percent per year, and he has the audacity to stand here in this House.... He's living proof of that old adage that for every complex problem, somebody usually comes up with a simple solution that is wrong.
Let's look at some of the spending elements of this budget. I am extremely pleased that my new Ministry of Skills, Training and Labour has received a significant budget increase. I'll go into some detail about where we're looking to spend those moneys, but I don't consider myself the winner for getting this money. British Columbians will be the winners for me getting this money and spending it in ways that will help average British Columbians.
The Minister of Finance travelled around the province prior to putting this budget together. She came to my hometown of Prince Rupert. She met with members of the business community, public sector unions, public sector employers and labour people, and she listened. People said: "Look, we've got some problems with respect to taxes. We can't take any more." We froze taxes for three years in this province. They're worried about jobs and job-training. We'll get into that. They're worried about the deficit. They know as average British Columbians that you can't continually spend more than you're taking in. Over the last two years, we've started to take positive steps to reduce the deficit. We now
[ Page 9577 ]
have an operating deficit projected to be less than $1 billion. We have a target....
Interjection.
Hon. D. Miller: I don't know what business school they come from, but if the best my friends in the opposition can do to attack this budget is to quibble over the fact that $300 million in expenditures, which have an identified revenue source, should be included in the deficit, then, I'm sorry, they don't have much to quibble about.
The Minister of Finance and the government listened to the people in my constituency. We are cutting waste in spending. It is significant that we've reduced spending in real terms to 1.3 percent. It is significant that we'll be reducing the deficit to less than a billion dollars, and subsequently to zero over the next two years. The fact that we have frozen taxes in this province for three years is significant. It is also significant that we are using some government assets to pay down the debt. We are cutting further waste.
I see members of the opposition praising the government, saying: "You've made some good moves." What can I say if the only complaint from members of the opposition is that we listened to them and average British Columbians and acted on that? What's their complaint? I don't understand it. We'll be making further cuts. The clear priorities of this government are to reduce the deficit, look at job creation and hold the line on taxes.
The hon. member for Peace River South just spoke in a really backhanded way about the minister responsible for women. He asked: "What does she do?" Where has that hon. member been? Did he not listen to the fact that 7,500 child care spaces are going to be created in this province? That's what that minister is doing. She is working on providing child care spaces so that some of the people you talked about who are stuck on welfare may have an opportunity to improve their skills and get jobs, knowing that they can put their children in safe, quality day care. That's well worth doing.
We're talking about investing $300 million in upgrading the Island Highway. Are the members opposite saying that that highway project should not proceed? Is it their position that highway projects -- including the Vancouver Island highway project and many projects in their ridings -- should not proceed?
We talk about the forest industry. Again, a priority of this government is to deal with the legacy of mismanagement in the forest industry in this province. I was happy to see those forest workers on the lawns of these buildings the other day. Those were working people coming down and saying to government and to the public at large: "Pay attention to us. Pay attention to our plight."
I want to relate that back. These issues don't just appear overnight, particularly when you're talking about resource management and forestry. They don't just happen. It wasn't last week, the week before, the year before or even the year before that when these problems started. The hon. leader of the Reform Party gets up and in a simplistic way says: "You shouldn't have that many government employees." Let's go back to the eighties and the actions of the then-Socred government that eliminated over 2,000 employees from the Forest Service. They brought in sympathetic administration; they struck a deal with the companies. And the legacy of that total mismanagement was what you saw on the lawns of this Legislature the other day. That's why 20,000 people were down here protesting: it's the legacy of mismanagement by that Socred government, year after year, which did not manage our resources in a proper manner.
[3:45]
This government is determined to bring in that proper resource management. We will have -- and we need -- a Forest Practices Code. All of us are aware of the threats against this vital industry from those offshore, those uninformed and those with their own agendas. It seems to me, when we look at bringing in forest practices codes and setting aside some of the best examples of our landscape, we can say to the world with absolute confidence: "We have the best forestry practices in the world. Knock off that boycott stuff." We came to this job late, after years and years of terrible Socred mismanagement, and now we're trying to deal with it.
So how are we trying to deal with it? First, through establishing CORE to try to achieve some consensus. We understand that consensus is difficult, because these are tough issues. It's not just a nice, neat little affair where everybody gets together and agrees; they're very tough issues. But should we not try? Sure, we should try. We launched CORE; in addition, we launched the timber supply review. Why is it that now, when we subject our timber supply to that kind of detailed analysis, we find our harvest rates are far too high? It goes back to the legacy of mismanagement of the previous Social Credit administration. We're determined to deal with that as well.
But it's not good enough simply to deal with the resource in isolation from people. We have to do the right thing. We do not want to wind up in British Columbia like our fellow Canadians on the east coast of this country, where the cod stocks have disappeared, the unemployment rates are up to 50 to 60 percent and nobody knows what to do. We're determined that that won't happen in British Columbia. We will tackle these tough issues, and we will not abandon communities and workers in doing that.
We have provided $40 million for a forest worker development program under B.C. 21 that is a continuation of the work we started last year. We're looking at providing forest workers with the skills, which they sometimes lack, to do a variety of jobs, particularly in the emerging occupations in forestry that are generally centred around land management. We're providing real money.
The opposition talks about cutting spending. Should we cut that spending? No. We hear silence from the opposition when we start to talk about specific programs. They generalize and say, "Don't spend money," even though they come and see me privately and say: "Oh, Mr. Minister, would you spend some money in my riding?" Should we stop spending money on forest workers? The answer is no. Should we not have increased the Ministry of Forests' budget this year to put more money into the small business forest enterprise program so that we can generate more revenue and jobs in this province? The answer is no. Should we not have maintained the spending of $275 million on silviculture this year? Of course we should have, because that provides jobs now and in the future. When you get beyond the platitudes and oversimplification that my friends on the other side are so fond of trotting out in this chamber, and you start to deal with the real programs and the real British Columbians we're trying to address in this budget, the picture changes.
Let's talk about some of the problems we have with respect to unemployment, because it's certainly true that although British Columbia is really in the most favoured position of any Canadian province, and although we're generating more jobs than any other province, we find that every time we come out of those down cycles in our
[ Page 9578 ]
economy, we have a structural unemployment level that continues to rise. So even though we have a flourishing economy, we still have unacceptably high levels of unemployment. I was looking over some statistics, and the city of Vancouver appears to be bearing the brunt. I'm sure that's no reflection on the fact that the now leader of the Liberal Party spent a number of years as mayor of the city of Vancouver. I'm sure there's no relation at all, but we find unacceptably high structural levels of unemployment.
When we look a little closer, we find that as many as 40,000 unemployed British Columbians could actually be working if they had acquired the skills necessary for some of the emerging jobs in our economy. Believe me, since I've been the Minister of Skills, Training and Labour, I have travelled around. I've met with the colleges and universities. I've talked to students, workers and trade unions. There's agreement that the job of really trying to equip our citizens in the workforce and in our schools with the skills that are relevant to this changing economy has really been left undone. We see the decline in some of the traditional jobs -- for example, the traditional forest sector jobs in the mills are on the decline. But if you look at the other side of the ledger, you can see there's an increase in fairly sophisticated technical jobs having to do with forest and land management. We desperately need to try to start to equip people with those skills, to build our economy and to invest in human capital.
I'm proud to stand up and say: "Yes, I do have an increase in my budget, and yes, that increase is going to benefit those in our society who really need it most. It will provide British Columbians with those skills." Unemployed British Columbians want to work. Sometimes I really resent the meanspirited characterization.... To be fair, I'll say that it may be unintended, but I think it is meanspirited to simply characterize all British Columbians who may, for a variety of reasons, wind up having to use our social safety system -- whether that be the unemployment insurance system or social assistance.... I find it meanspirited; perhaps it's not meant that way. This government has taken measures. You've heard of the savings we expect to generate -- some $20 million -- by cracking down on those who would defraud those systems. I'm aware that any system is open to that kind of fraud, and we've got to combat it. But, quite frankly, almost 300,000 people are mired in that social safety net, and they want to work. When we are dealing with those issues, we should try in our remarks to be clear that we simply don't blame the victims.
A joke was told years ago -- I used to tell it a lot -- about the old W.A.C. Bennett government and the way they dealt with people who happened to fall between the cracks and unfortunately landed on welfare. In fact, my predecessor in Prince Rupert joined in on the joke, which was that the Socreds decided to declare war on poverty and sent Phil Gaglardi out to throw rocks at beggars. All too often, that's the attitude we get from that side of the House.
The people who wind up there are single mothers without affordable day care for their children and without the skills that would allow them to become more attached to the labour force. They're young people coming out of school without the skills that allow them to go into a very tough job market. We talk about our young people. It's interesting that when we ask young people entering their last years of high school what they think they're going to do, 90 percent say: "I'm going to university." Guess how many go? Less than 30 percent. Some 70 percent of young people coming out of school don't go on to any post-secondary institution within three years of leaving. They're out trying to get jobs in a very tough market -- the "McJobs." We have to start giving those young people more opportunities.
I went through the apprenticeship system. Far too few opportunities are there. We need to look at revitalizing the apprenticeship system. We need to look at partnerships with employers, because businesses, as much as they've invested in technology -- and we've seen the result of that technological investment, particularly in the forest sector, and the decline in employment -- need to invest in human capital. They need to invest in people, because at the end of the day people really are our most valuable resource.
W. Hurd: Where are those 22,000 jobs?
Hon. D. Miller: There are more than that.
We also have to do something to try to create more opportunities at the post-secondary level. The estimates -- and let me caution that these are estimates, because it's very difficult to forecast -- are that maybe 20,000 students in British Columbia want to get into university or community college, and there's no space for them. I'm proud to say that we've increased my budget. One of the results of that increase is the creation of over 8,000 new spaces in our universities and colleges, so that our young people have some place to go to acquire those skills. I don't hear the opposition attacking that. They say "cut spending," but they don't attack that.
We talk about the skills required in this new economy. Half of the skills of technical workers become obsolete within three to seven years of their training. They require upgrading and retraining and should be able to get what they need without sacrificing employment. Again, it's not just the initial training that people require, whether it's apprenticeship, college or whatever; it's lifelong learning, upgrading.
I was very pleased that my ministry, along with the federal government, sponsored a retraining effort in my community as a result of layoffs that occurred in the pulp mill. I was struck by a couple of things. I attended the graduation ceremony on Friday. Some of the workers who entered those training programs -- and there were a variety of them: pulp technology, welding and a number of others -- could have gone back to work but instead chose to stay in class and get their final certificate. There was a very strong feeling among the workers I talked to that it was important for them. They feel that they need to have those kinds of skills and opportunities. That's a small example of the direction we're going in and of where we're putting our resources in this province so that we have that kind of highly skilled workforce.
What about the groups in our society that have been disadvantaged? Again, it's all too easy to simply blame the victim and say that it's their fault if they haven't prospered in our society. That's a Walter Mitty approach, I suppose, but it's not a recognition that all of us in this province -- not just government, but businesses and individuals -- need to try to create opportunities for people. Why is it that when you look at various elements in our society such as women, aboriginal people, visible minorities and people with disabilities, their employment rates are so terribly low? Is it because they're less worthy human beings, because they're not smart enough or because they don't have the drive? Absolutely not. A lot of our citizens face systemic barriers to employment, quite frankly, because most of us don't face them, we don't really care too much about them.
Why is it that when visible minorities and women make up 60 percent of the workforce, they make up less than 3
[ Page 9579 ]
percent of the apprenticeship systems? It seems to me that the answer is reasonably clear. A little inward-looking is required by all of us, including employers. We have to do more to specifically target those members of our society who have not been able to take advantage of the opportunities in one of the most prosperous areas of the world. It's not good enough to simply point a finger and try to characterize everybody who is unemployed as somehow being worthless and not really wanting to work. It's a personal feeling, but I get quite concerned about those kinds of broadly based attacks. That's why I was so offended by the former Social Credit leader when he made a joke about presenting shovels to people, without realizing that he was talking about people who, in many cases, were living in abject poverty and who were suffering. He was making a joke at their expense. Quite frankly, that's why so many people found that so offensive. I think all of us need to consider that as we focus on this. I understand the opposition's desire to do their job and attack the government, but my caution is that we should be selective, careful and prudent about how we talk about it.
[4:00]
We really have nothing to apologize for in terms of taking a balanced approach in our budgeting and avoiding the terrible mistakes made by Social Credit back in '83 -- the slash-and-burn approach, when they cut 2,000 workers from the Forest Service and impaired the Forest Service's ability to do their job. Now we're trying to clean up that mess. I don't think we should apologize for a minute for taking that kind of balanced approached and maintaining growth in this economy. There's absolutely nothing wrong with having decent wages in our economy. Working people spend their money in this economy by buying houses and material goods; they contribute to this economy. It's called the internal economy. If you want to go to some places where they don't have that wage level, check out their economies compared to ours.
[The Speaker in the chair.]
The hon. Labour critic -- perhaps we'll get into that in another forum -- was commenting on the Thompson report that just came out, which is about dealing in a good, intelligent way with issues like the minimum wage and extension of benefits. His remark was that if we move in any of those areas, we would deprive young people of jobs. I immediately went and checked some statistics, and I discovered that in British Columbia, where we have a minimum wage of $6 an hour, the unemployment rate for the 15- to 19-year-old age category is unacceptably high: 16.7 percent. That's unacceptable to me, but that's what it is. Then I checked out a couple of states in the United States: Florida and Louisiana. The unemployment rate for that age category, 15 to 19, is 22 percent and 26 percent respectively. Guess what? They have no minimum wage whatsoever. If that's the kind of economy and society the members opposite are advocating, then I don't think British Columbians are going to accept that. I don't think you're talking to British Columbians; I don't think you're listening to British Columbians.
We want to take a balanced approach; we've done that. We have reduced the rate of spending, and we have brought the deficit down to below $1 billion. It will go down further next year. I know they don't like it, but by 1996 there will be a zero-zero-zero operating deficit in the province of British Columbia. I think we're on track in serving the needs of our citizens, in maintaining our economy and in controlling the cost of government. As I said at the outset, in my view this is one of the best budgets that has ever been brought down in the history of this province.
M. Farnworth: Hon. Speaker, it's going to be a pleasure to follow such stirring words and such truthful comments. I, too, rise to speak on this budget. It's a historic budget for British Columbia. I want to talk about some of the highlights, what it means for the province as a whole and what it means to my constituency. Then I want to focus on what the Liberal opposition proposes, how they would deal with the economy of British Columbia and what their budget proposals might consist of.
This budget does what we said it would do. It brings the deficit down, it creates jobs and it has a three-year freeze on taxes. We have the strongest economy in the country, and we have one of the strongest economies in North America, with 3.2 percent growth last year -- the best in the country. Every other province is envious. Every Liberal jurisdiction in this country would love to have the economic growth that we've had over the last year -- 76,000 new jobs.
Interjection.
M. Farnworth: One of the members of the opposition asked where. If he came out to Port Coquitlam, he would see. In the last three years alone, over 5,000 new homes have been constructed: good, solid, paying jobs in construction, services and roadbuilding are employing British Columbians. That's what this government has done. We've brought stability to the economy of this province, after years of spending that was out of control: 12 percent, 12 percent and 12 percent at a time when the economy couldn't sustain it. We've brought spending under control, and we've brought in a system so that this year alone there has been 3.5 percent growth in spending. It has been targeted not to Social Credit -- or, as they like to call themselves now, the Reform Party -- giveaways. We have ensured that the services go where people's needs are greatest -- to things like schools, roads and hospitals.
We have a growing population: 150,000 people in the last two years. The opposition seems to think that we're not doing a very good job. Let me tell them this: people speak with their feet, and they're moving here every single day from all over this country and from around the world. Retail sales are up 7.8 percent. That's the strongest in North America. Capital investment is up. It's the strongest in North America and in this country. This government has created a foundation to ensure that British Columbians are put to work and that we get our financial house in order. That's what we're doing. The deficit this year will be $898 million. That's down 65 percent from the $2.4 billion mess that we inherited when we took over. No other jurisdiction in this country even comes close to making the progress that we've made. There have been those who herald what's happening in Alberta -- and I'll talk about that in a minute -- but even Alberta doesn't come close to making the progress that we've made.
Locally, this budget will have a tremendous impact on my own constituency. As I've stated before, we're a rapidly growing community, but we're also an affordable community; we're one of the most affordable areas in the lower mainland. Over 5,000 units have been created. We've lived up to a campaign commitment in this budget. We did away with the property transfer tax for first-time homebuyers. The average price of a house in Port Coquitlam is around $250,000. Condominiums start at anywhere from about $90,000. We're telling that young couple who are
[ Page 9580 ]
buying their first place that they're going to save $3,000. That's $3,000 that they don't have to worry about, or an extra $3,000 that they can put on top of a down payment. That's going to make a real difference in the lives of ordinary British Columbians. It's going to make housing much more affordable. That's something we campaigned on and it's something I'm extremely proud to announce in my constituency, because we're affecting the lives of ordinary British Columbians. We're also increasing the threshold for the homeowner's grant. Last year it was at $400,000; this year it will be $450,000. When the Liberal opposition was moaning and complaining last year, warning people that this government was going to take away their homeowner grant because they wouldn't raise the level at which it kicks out, we said it wasn't true. This budget shows that. We carried through with that commitment. More people in my constituency are going to get the homeowner grant.
We're spending $1 billion on infrastructure for a growing province. It's amazing that the federal government seems to think that infrastructure is important. When you listen to the Liberals, they don't want infrastructure; they don't want schools, roads or hospitals. They don't want us to spend the money that's required to provide for a growing population and for growing areas like the one I represent.
A. Warnke: Where did you get a notion like that?
M. Farnworth: The hon. member for Richmond-Steveston asks where I got a notion like that. I'll tell him where I got it: from his own leader, who has advocated 10 percent cuts in areas like education and said that we have to make cuts to health care and social services; in short, we have to penalize ordinary British Columbians.
J. Beattie: Those who need it the most.
M. Farnworth: Those who need it the most, as my colleague from Okanagan-Penticton quite rightly points out.
The fact is that we're making investments that are needed today. It's just like when you have a growing family -- a two-bedroom home is no longer big enough, and you have to add on a third or a fourth bedroom. We have a growing province. More roads mean more jobs. It means more opportunities for business, it means more opportunities for this province. That's what we're doing: investing in the future. We've got the very best credit rating in the country. We know how important that is. Unlike the opposition, which seems to think that Moody's is a holiday destination, we know how important Moody's credit rating is to this province.
I see even the opposition caught that one. It's nice to see they still have a sense of humour.
An Hon. Member: It took them five minutes.
M. Farnworth: That's because they're Liberals and it takes a little time to sink in.
There are different opportunities and different ways to approach economics and approach budgets. I'll tell you something. We've rejected what some provinces have done, and we've said we want to take a reasonable, long-term approach so that people can expect and see what's coming -- stability and predictability. In other words, it's good government.
On the other side of the mountains there's a province called Alberta, where there's a movie playing called Nightmare on Klein Street. Ralph Klein has cast himself in the role of Hannibal Lecter and is busy cannibalizing all the public sector services in that province.
An Hon. Member: Shame!
M. Farnworth: Shame, as my hon. friend says.
There are user fees for kindergarten, a 10 percent cut in the education budget, and 10 percent in the environment budget. We don't need that here in British Columbia. In fact, the Leader of the Opposition seems to think.... He says he understands what's going on there. I'll bet he does. I know what show would be playing if he were in power here. It would be called Nightmare from Howe Street, and he'd have himself cast in the leading role of Freddy Krueger, slashing the public services of British Columbia. He'd be slashing spending to schools, slashing spending to health care and slashing spending to the environment. He'd be putting thousands of British Columbians out of work, and he'd be jeopardizing the economic recovery that this government has worked so hard to implement. That's a show I'm confident the people of this province won't choose. They won't choose Nightmare from Howe Street; instead they'll give two thumbs up for Jobs on Main Street every time.
As I said at the beginning, this is a budget for today. It's a budget for the future, it's a budget for British Columbia, and it's a budget of hope.
[4:15]
D. Schreck: In supporting this budget speech, I'm happy to see a budget in which the deficit is down, in which jobs are up, and in which there's a three-year tax freeze.
In the short two and a half years of this government the deficit has been brought down by 60 percent, despite massive off-loading from the federal government -- off-loading by denying the federal government fair participation in health and education, off-loading from the federal government to this province on health and education, which was begun under the Trudeau Liberals, continued under the Mulroney Tories and now is being examined for a further dump on social assistance programs under the Canada Assistance Plan by the new Liberal bunch in Ottawa.
Have we heard any pressure from our friends on the opposition benches on their federal cousins, that Liberal government in Ottawa? Have we heard from our friends on the opposition benches how that federal Liberal government should stop dumping on British Columbia? No, we haven't. What we have heard I'll go into in a few moments. But it would be nice if the opposition would stand up for British Columbians rather than standing up for their federal Liberal cousins.
We have seen a budget in which jobs are up and there is continued strength in the B.C. economy. As my constituents frequently point out to me, no government should take credit for generating those jobs. For many in the private sector, it would seem that governments have an ability to be job killers. But in British Columbia the government has not gotten in the way of that entrepreneurial spirit. The government has meshed well with that entrepreneurial spirit, has listened to business and is helping business prosper.
In British Columbia in the last 12 months we have created 50 percent of all of the jobs in Canada. We have the highest growth rate, the highest credit rating and the lowest business bankruptcy rate. Every economic indicator points to this province as the place to be, the place of success. Today we have a provincial budget that builds on that success, expresses its confidence and helps British Columbians. It
[ Page 9581 ]
extends that help by honouring the Premier's commitment of a three-year tax freeze.
When I talk to some of my constituents about a three-year tax freeze, some naturally express some initial skepticism. They ask what that means. The U-brews in this province know what that means. Some wanted to shut down the U-brews through exorbitant taxes in order to eliminate some competition and some do-it-yourself work. They know what that commitment means for the next three years. The restaurant industry that has lobbied everyone in this chamber, every budget season, about the fear of having a tax on restaurant meals, knows what that three-year tax freeze means. Small businesses which would have been hurt if another percentage point were added to the sales tax -- which could have been a step towards some sort of radical balanced budget legislation -- know what that means. Instead of having that mindless approach to balancing overnight, we have a balanced approach that looks after the economic interests of those business people and those men and women working throughout this province. My constituents know by real, concrete examples what it means when we talk about having the deficit down, jobs up, and a three-year tax freeze.
When I heard the Premier on CBC television a few weeks ago, I thought that if that was the basic message our government is extending to British Columbians, that by itself would be very good news. I am surprised and delighted to see that the news in the budget is even better than that.
Sixty-five percent of the people in my constituency are tenants. A lot of them are young families or people who have never owned a home. This budget says to those young families: you're going to get a break of possibly $3,000 to $4,000, depending on where you choose to buy a home, by the waiving of that unpopular property transfer tax that was introduced by the Socred government. Our government has eased the burden put on first-time homebuyers by that Socred government. Our government has recognized the ambitions of those young families.
I was delighted to see on the front page of today's North Shore News that my friend and neighbour from the Liberal opposition benches was praising the positive impact of this budget on my constituents. The front page of the North Shore News said today: "But [the North Vancouver-Seymour MLA] said most North Shore residents who would benefit from the tax exemption would be Schreck's constituents...."
I agree with the opposition member that our government is benefiting working people throughout this province. We have restored tax fairness. Those in the six-figure income bracket are paying more fair taxes, and those in the $30,000-to-$40,000 income bracket are having the property purchase tax -- which was implemented by the Socreds -- waived. It so happens that ordinary working people populate my constituency, and they are benefiting from the economic policies of this government.
I continually ask the opposition not to be simply naysayers -- criticizing everything that comes along for the sake of criticizing it -- but to offer a few positive alternatives. Someday we are all going to face the voters again. Rather than having the builders of the province on the government side facing the naysayers on the opposition benches, perhaps it would be more constructive if we put two visions of action before the people. We on the government side have the budgets and economic growth of this province as well as bringing down the deficit, getting jobs created and freezing taxes.
What is offered by way of alternatives? We've heard some of those alternatives. While we have to hunt for them in this chamber, I must say that we are aided by statements attributed to the opposition and by the fact that the official opposition went through a bit of a leadership race, where the person who got them their seats was purged. During the purge we heard many statements about what the new opposition Liberal leader would do to the people of this province. We heard that again in the statements today by the opposition Finance critic.
What is one thing that the Liberal opposition would do? I have to say first that no one in this chamber would like to see any taxes. But regrettably, in the world in which we live, gold doesn't fall from heaven. We have to get the money somewhere to pay for health, education, highways and the services we need. The question is how to do it in a fair way.
We could do what they did in Alberta, and gut the health and education systems with across-the-board cuts of 10 or 12 or 15 percent. Or we could do what they've done in some jurisdictions, and say that we're going to tax ordinary working people even more, making them pay the bill. But we said that it's time for a little tax fairness. One of the measures we took was the introduction of the corporation capital tax. I, as much as any member in this chamber, would like to eliminate the corporation capital tax. But I've got to say that I would like to see it eliminated after I've looked after income tax fairness for middle- and low-income taxpayers, after getting the social services tax down another point and after lightening the burden of property taxes on residential homeowners.
I have on my priority list that it's necessary to make some adjustments to that tax, as the Minister of Finance did yesterday, by eliminating it for the family farm and by upping the limit for another 1,000 small businesses. But its outright elimination for all businesses, big and small, as promised by the opposition leader, would cost what? Well, in the estimates book it tells us clearly what that would cost: it would cost $364 million to honour that one throwaway promise by the opposition leader.
What could you do with $364 million? Well, you could build more than ten Westview interchanges in my riding; you could build the most expensive option to replace the Lions Gate Bridge; you could operate three hospitals like Lions Gate Hospital. So if that Liberal opposition leader ever is given the nod to govern this province and that giveaway to his corporate friends is honoured, what's going to happen? Are hospitals like Lions Gate going to close? Are we going to have to wait another 25 years for the Westview interchange? Will it be that we never see a replacement for the Lions Gate Bridge? Those are the types of projects that member is throwing away when he promises to his big monied interests that he would cave in on that tax.
What other differences exist between those opposition promises and vision and what our New Democratic government has promised and delivered for the people of British Columbia? At that convention that purged the former Liberal leader, I heard the new Liberal leader say he would immediately deliver in his first term of office -- when and if that ever occurred -- the elimination of the school tax for businesses.
Interjection.
D. Schreck: I'm delighted to hear the opposition benches applauding that promise to cave in. Again we have to say: a dollar you don't put into the purse either has to be taken from someone else or has to be realized by cutting expenditures somewhere else. I just explained that the cave-in on the corporate capital tax -- not the fine-tuning
[ Page 9582 ]
and adjustments that have helped family farms, as our government has done, but the total cave-in across the board to all businesses big and small -- would cost three Lions Gate Hospitals, 10 Westview interchanges or one and a half Lions Gate Bridge replacements. Well, that is small potatoes compared to what it would cost to deliver that other cave-in to the big monied interests that financed some of those Liberal opposition promises, hopes and plans for the future. Again we can turn to the estimates book, and we see that in this case the school property tax on businesses -- not on your home and mine -- raises $680 million every year in this province.
What do you have to do if you're going to offset the cave-in and giveaway of $680 million to your wealthy friends? Well, you have to look somewhere else. We can look down the list here and see how much other tax is raised. We see that the fuel tax raises $636 million. So I suppose we could say that what that Liberal opposition is promising is to double the fuel tax. They might be able to get gasoline up to $1 or $1.50 a litre with a promise like that. But I know that the folks in my riding don't want to pay gas prices like that to make up for the cave-in to the Liberal financiers.
We could look at other possibilities here. We could see that the hotel room tax raises $66 million; that is one-tenth of what the Liberal opposition leader is promising to give away to some of his business friends. Well, we could make it up by jacking up the hotel tax so high that it kills the tourist industry in this province. There might be other alternatives. Perhaps they're just talking about eliminating 20 percent of all of the hospitals in the province or closing a fifth of all the schools.
[4:30]
Interjection.
D. Schreck: Like Ralph Klein, my friend says. That is the opposition's vision.
It is important to deal seriously with important matters of public policy. It is not easy to put together a provincial budget. We have seen our government struggle with difficult challenges dealing with all the people on all sides who are affected. I was pleased to hear my colleague the Minister of Finance present a budget yesterday and then to turn on the TV and see the automotive industry applaud my colleague. They said it was a good budget that helped their industry. I called my constituency office, and my constituency assistant told me that people were calling in and saying that they're now going to go out and buy a car because of the confidence in the commitment made by our Minister of Finance in this budget?
I turned on the TV yesterday and saw representatives of the real estate industry -- the same industry of which my good friend from North Vancouver-Seymour in the Liberal opposition is a member.... My good friend was able to say with considerable authority on the front page of today's North Shore News that my constituents will benefit and be assisted in getting a home as a result of that budget. I saw the real estate industry stand up and say that this is a good budget that will help British Columbians, get people into homes and spur growth in this province.
When we compare real moves like that, at the same time that the deficit is coming down, jobs are going up and taxes are frozen, with the vision that's offered by the opposition, we have to say: "Friends in the opposition, where would you get the billion dollars that you've promised to give away in the first term of office to your corporate friends in just those two tax concessions? Are you going to get them out of my constituents' pockets by doubling the sales tax, destroying the tourist industry or closing my hospital?"
It's not enough to engage in the empty rhetoric that we hear from the opposition benches of across-the-board cuts and emulating Ralph Klein. The people of British Columbia deserve better. They deserve that balanced budget, they deserve the jobs that are being created and they deserve that freeze in taxes. They don't deserve a tax dump in order to pay for concessions to opposition buddies and friends. They don't deserve to have to make up for those off-the-cuff promises to people who may finance campaigns.
In listening to the response from the opposition Finance critic, I respected some of his comments as an accountant. I particularly respected the first five or ten minutes that the Finance critic spent yesterday with his breath so taken away by this budget that there was not one critical remark. Every comment made was to try to take credit for the good news of this budget.
I have to admit that, in addition to talking to my local media yesterday, I picked up the phone and talked to the Powell River News. A reporter, being the cynical folks they tend to be, said: "You may be talking the line of the government, but what's the opposition saying?" I said: "My friend, you can listen to the opposition Finance critic. For the first five or ten minutes of his speech, all he could do was run in front of the good news and take credit for it. If that's all the opposition can do, it must mean that we really have a good-news budget."
When I listened to the more in-depth comments we heard today, the hour-long version of those five- or ten-minute comments was much the same. My friend was smart enough not to repeat the opposition leader's foolish promises of giveaways and $1 billion in concessions to corporations, because he probably understands how that would hurt ordinary working people. But he did throw out some of this confusing rhetoric on the difference between debt and deficit, and I want to take a moment to talk about that.
As someone who is used to ordinary household finance, and as an economist, I find that it does a great disservice when setting policy if you mix up paying for your groceries with the purchase of your house and your mortgage payment. We are reducing and eliminating the deficit. That means that out of the day-to-day revenues taken in by this government, through the income tax, sales tax and various royalties, we are able to offset all of the operating expenses of paying for health, education, social services and the justice system; and by next year, or certainly by the 1996-97 fiscal year, that deficit will be gone. The people in my riding tell me that they don't care what I have to do; they want the Westview interchange yesterday, and they understand that that $30 million project cannot be paid for out of day-to-day expense money, and that they're going to have that Westview interchange for decades to come -- hopefully a lot longer than I'm going to be around. We shouldn't pay for it the same way we pay for the schoolteacher's salary next month. It would be rather bad accounting to take an asset, real wealth, and instead of paying that off as you pay your mortgage payments, pay that off in one lump sum and say: "Oh, the budget's unbalanced." Anybody who runs a household account knows that if you go out and buy a new home, you don't say that you suddenly made a major financial mistake this year because you have to pay for the whole home all at once. Buying a home is paid for over many years of mortgage payments, and at the end of the day you wholly own one of the most valuable assets you have in your life. Buying that home is equivalent to buying the hydro dams, the B.C. Rail system or the schools -- or buying the Westview
[ Page 9583 ]
interchange, which I hope to hear announced in the next few months. Those types of capital purchases are real assets.
It's no wonder we hear nonsensical, confusing promises from that Liberal opposition, because they don't seem to understand the difference between a balance sheet and a profit-and-loss statement. The flip side of debt in this province is over $60 billion in real assets: schools, courthouses, bridges, roads, dams and the railway.
I agree with my constituents that I want another asset in that list of Crown assets owned by this province: the Westview interchange. I want the opposition to stand up and be honest with my constituents. Are they saying that they won't build it? Are they saying that they put their funny-money policies ahead of delivering on the Westview interchange for my constituents? Let them get their story straight. Which is it: Radical Ralph Klein's restraint, or building the province of British Columbia? Building that Westview interchange is an investment. I have seen people from throughout the North Shore sit at that traffic light for half an hour on a Friday afternoon, missing their ferry, being late for dinner, being angry and polluting the air. They tell me quite clearly that that is not a waste of money, that it's not like paying a salary, but that to get on with that project is an investment in their quality of life and the future of this province. Every time I have the opportunity to be on my feet, every time I have the opportunity to communicate with my constituents, you're going to hear me putting pressure on my friends in government to build that project yesterday, if not sooner.
I say shame to those opposition benchers. You're saying that you would put Ralph Klein's radical restraint ahead of the interests of my constituents. We know who speaks for whom. We know who speaks for the six-figure income set and who speaks for ordinary British Columbians. We know who speaks for funny-money policy, those who can't understand the difference between a profit-and-loss sheet and a balance statement, and who wants to build real assets for the people of British Columbia.
I urge everyone to look at the real numbers, to put numbers behind those hollow promises from the opposition benches. It may sound good when they say: "We'd like to eliminate school taxes." They sometimes forget to mention that what they're talking about eliminating is school taxes for business buddies, while they keep them on your home. If I had my choice, and we had the budget balanced, the debt coming down and could reduce taxes, I've got to say that I'd cut taxes for residential homeowners long before I would cave in to the business friends for whom the opposition Liberal leader is trying to deliver.
We know now who speaks for whom. We know we've got a government that was capable of getting the deficit down, of getting jobs up, of balancing taxes for three years and taking another step beyond that -- offering hope to the constituents in my riding that they can get their first home with a saving of $3,000 or $4,000 by eliminating that bad Social Credit tax. You'll have to hold it down in contrast to that other vision that would say to 65 percent of tenants in my riding: "You can wait to buy your home, because we're going to deliver for our corporate friends. You can pay a higher sales tax, a restaurant meal tax or a tax from the U-brew, because we're going to cave in on these billion dollars' worth of taxes for our rich buddies."
I've got to tell you, hon. Speaker, that most of my constituents don't know what those tax bills look like, because they live in another world. But then I have to say that those opposition benches seem to live in another planet than the real working people in this province. I am pleased that we have before us a budget that shows the difference in who stands for whom and where growth is going in this province. It is a budget that I can stand behind and say: it is delivering on commitments like this that make me proud to be a New Democrat and make me look forward to standing in an election against those opposition members who want to deliver for 2 or 3 percent of their friends. I'll look after the other 90 percent, and I'm proud of that.
M. de Jong: This afternoon I received the golden tap indicating that I would be asked to deliver my maiden speech to this assembly. I'm told that that affords me a certain opportunity to deal with not only the budget speech itself but also matters particular to my riding. I understand that I will be granted that opportunity. I'm reminded that I won't be heckled, but I'll leave that to the discretion of the assembly.
It is a privilege, Mr. Speaker, to rise and participate in this response to the budget speech, and to render my maiden speech to the assembly. First, Mr. Speaker, as others have done, I offer you my congratulations on assuming the mantle of the Chair. I don't mind saying that it's a bit traumatic, as all new members rising in this place know, to attempt to meet the legacy of debate and oratory. Just a few days ago one of my constituents was in the gallery and commented on the brightness of the lights shining on my thinning coverage up here. Several days ago, coincidentally, I came across an anecdote involving a former U.S. House Speaker, Nicholas Longworth, who was totally bald. But that did not inhibit his ability to be with the ladies. Apparently, a congressional aide approached Mr. Longworth, ran his hand over his bald head and said: "It feels just like my wife's behind." After passing his own hand over his head, Mr. Longworth said: "My heavens, so it does." I wish you well in the chair, Mr. Speaker.
[4:45]
When I was a young man I took a tour of the Legislature. On that occasion, as a ten-year-old, I was impressed first of all by the physical surroundings. I was impressed by the chamber here, whose walls have borne witness to so much of the political history of our province. I was impressed by the seriousness of purpose with which the members of the chamber and the occupants of the building approached their work. All those impressions returned to me last Monday as I entered the building for the first time as the newly elected member for Matsqui. To those observations I'd like to add one more, which is the particularly warm and friendly welcome I've received from all hon. members and their staffs. I thank them for that.
The winds of change are blowing across the province of B.C. My presence in this chamber is demonstrative of the fundamental changes that are reshaping the political landscape in B.C. Some people have suggested that the Matsqui by-election should be termed historic. I'll let the historians make that judgment. What is a fact is that for the first time in over 40 years the people of Matsqui, my neighbours, abandoned their traditional party of support, the Social Credit Party, in favour of a candidate representing the B.C. Liberal Party. They opted for the new era of leadership that we in the B.C. Liberal Party are offering. It is a new approach to politics and a rejection of politics driven by ideology and, ultimately, paralyzed by extremism. That same spirit of renewal and revival was at work in Vancouver-Quilchena. I'm proud to have entered this House on the same day as the new leader of the B.C. Liberal Party and member for Vancouver-Quilchena.
When the by-election in Matsqui was called, there was an expectation in some quarters that another individual might occupy this seat that is reserved for the member for Matsqui.
[ Page 9584 ]
I am proud and humble to have been called upon by the people of Matsqui to sit in this chamber. I'm mindful, however, of the contribution made over the past many years by one of my opponents in the Matsqui by-election. You don't have to agree with all that Mrs. McCarthy advocated to admire the spirit of the woman and the enthusiasm with which she approached the task of representing her constituents and British Columbians. The mantle of leadership, I'm sure, weighs heavily upon those who are selected to carry it. For Mrs. McCarthy, it can only be with great regret that she finds herself presiding over the demise of her once-formidable party. I do not lament the passing of her party; that is a reward the decimated ranks of the Social Credit Party have brought on themselves. I do, however, remain tremendously respectful of a woman who has dedicated much energy towards improving, in her own way and in the way she felt best, the province she clearly loves.
Having said that about Mrs. McCarthy, I should like to at least make passing reference to an individual who almost became a candidate for the governing party. I will preface my remarks with the comment that I think we all come here with principles. We all come here espousing certain ideas of fairness, and parliaments in this country and this province have created charters, human rights acts and constitutions that purport to enshrine those concepts of fundamental fairness. Principles of equity, which we all purport to hold so dear, really are, in my view, rendered meaningless if we demonstrate by our actions a willingness to abandon them purely for the sake of convenience or political expediency. Let all members of this chamber be on guard not to subvert the ideas of fairness and equality, which I hope we all seek to promote, by our more partisan desire to achieve or maintain a seat on one particular side of this chamber.
As I said, I am proud to have been elected to represent the people of Matsqui. I know Matsqui well. I was raised there on a very small farm, I attended public school there and I practised law there in a small practice in the district of Matsqui. I have a long history of community involvement. I hope that when I address this assembly, in spite of the differences that members opposite may have with some of the things I say, that no one will doubt that I speak with the conviction of my purpose in putting forth Matsqui's concerns and needs. I intend to, and hope that I can, represent Matsqui and make certain that its concerns are represented as often as is necessary and with as much force as is necessary to effectively represent the interests of my constituents.
Like, I'm sure, all hon. members, and certainly like the member who immediately preceded me, I am proud of my community and of its many accomplishments. The member for Abbotsford is here, and I think we both share a pride in what has become the Abbotsford Air Show, the Central Fraser Valley Fair and the Agrifair. We are proud that we will be welcoming the Western Canada Games to our community in the very near future. Very shortly, the member for Abbotsford and I will be living in an amalgamated community, and that is something we also take great pride in.
I'm proud of the manner in which my constituents have responded to the pressures associated with being one of the fastest-growing communities in B.C. Regarding education, members will know about the difficulties associated with ensuring proper housing for students in their ridings, and certainly that is the case in my riding. Members will know about the pressures brought on governments at all levels to ensure proper funding for ever-growing numbers of students in their ridings and elsewhere. In my community, the difficulties associated with funding increased demands on hospitals and health care are something we must deal with on a daily basis. It calls for great vigilance on the part of all governments, more particularly at the provincial level, to ensure that public moneys are expended wisely and responsibly to ensure they are placed where they are most urgently needed.
In my community we have concerns about air quality and transportation. More particularly, we've heard from the member preceding me his concerns about a particular interchange. We have similar concerns. So when the member suggests that members of the Liberal Party aren't sympathetic to the needs of community, I can assure him that he is absolutely incorrect, and I will join with him in urging upon the government a response to the needs of my community.
In the short time that I have been here, much has been said about updating and changing the manner in which this chamber and the government of the province undertakes its business. Reform seems to be the catchword for more reasons than just the obvious. My observation is that reforms are required. We must bring to the government, to this chamber, and to politicians throughout the province a greater concept of financial accountability. That is why members of the B.C. Liberal Party have called for legislation compelling the delivery of balanced budgets. It's why we call upon the government to introduce legislation compelling standardized accounting practices -- to avoid those shady practices of this government and governments of the past which have attracted such valid criticism from, among others, the auditor general. And it's why we have called for greater ministerial responsibility for expenditures and cost overruns, and why we dealt with that, concentrated on it, and emphasized our belief that the time has come for ministers of the Crown to take personal responsibility for the budgets they administer.
We have called upon this chamber to embrace concepts of political accountability and to enshrine that principle in the rules by which we conduct our affairs and our business. It's why we have called for a greater availability of free votes. It's why we have called for the introduction of meaningful recall legislation.
Others seem to be attracted to these ideas, and now call for them and proclaim their commitment to them. I again preface my remarks by ackowledging the fact that I have only been here a short time; but I am suspicious of the sincerity of those individuals who make those calls and those demands. It is perhaps the words of a restless younger generation, but I am compelled to make the observation that they had their chance. And where did these members deposit their commitment to change during the days not so long ago when they were in a position to act upon the intentions they now so loudly proclaim? Like the early morning commuter, those members are watching the bus pull away from the curb and they're clamouring to climb on board, and I am suspicious of their sincerity.
The budget delivered by the Minister of Finance yesterday has given rise to some members, particularly those bent on defending the document, pointing selectively to the figures presented by the government. I will not follow their approach. When you get right down to the budget and all that the minister said yesterday, it's an issue of credibility. The fact of the matter is that British Columbians don't believe this government anymore, and they certainly don't believe this government when it comes to reporting the true state of our economy and the province's books.
[ Page 9585 ]
In November of last year the auditor general tabled a report that seriously questioned the accounting practices of this government and its practice of hiding debt. We see that abuse process continuing and being taken to the nth degree in the speech delivered by the Minister of Finance. The member preceding me made the comment that he addresses these matters from the perspective of a householder. The householder doesn't have the option of hiding debt in the manner that this government purports to in the budget it introduced yesterday. Small businesses in this province don't have the option that the government has availed itself of -- incorrectly, I might add -- to hide debt.
[D. Lovick in the chair.]
When British Columbians find themselves questioning the credibility of the government and the Minister of Finance, they do so realizing full well what has taken place in the past. The government says no new taxes. British Columbians, who have witnessed the largest single increase in taxes in the history of the province, are appropriately skeptical of what the government says. When you look at the figures, the NDP budget increases spending by $675 million. Since 1991, spending has increased by 16 percent, which doesn't strike me as a frugal approach to guarding the public purse.
[5:00]
What do these figures really tell us? What's really taking place here? To accurately assess that, let's examine the accumulated debt, which is, after all, simply deferred taxes -- and the day of reckoning is near. What about that debt? When you examine the figures, you know that every family in B.C. is now responsible for $2,600 more debt this year than last. Is that a responsible approach to guarding the public purse and expending public dollars? I think not.
Since the NDP government took office, an examination of the figures will reveal that the accumulated debt has increased by over 50 percent. Perhaps most disturbing is that all of this has taken place at a time when we've witnessed and been forced to incur record tax increases. They've raised taxes and lost money at the same time. It's difficult to comprehend, and at this point it's impossible for British Columbians to withstand. Members on both sides of this House will examine the budget documents tabled yesterday by the minister and the speech provided by her, and they will put their own spin on them. The bottom line is the significant increase in the debt, which we will have to reckon with in the years to come.
When the Premier says "no increased taxes," what does he mean by taxes? Is he including in that analysis the various fees and licence charges that we're compelled to pay on a day-to-day basis? When members trumpet the fact that the property purchase tax exemption has been extended to first-time homebuyers, within a certain amount, are they taking account of the fact that those same homebuyers may be precluded from purchasing a home because they can't sustain other charges, such as B.C. Hydro, on a monthly basis? Those are the questions that ordinary British Columbians have to deal with on a day-to-day basis, and those ordinary British Columbians are becoming a bit tired of the chicanery and warped accounting practices of this government.
It also disturbs me that when I examine the budget documents.... I confess that many of the tables and approaches are foreign to me, perhaps as foreign as they apparently are to some members opposite. That, after all, is part of the problem. Ordinary British Columbians don't know the true state of our books. They deserve to know that because, after all, it's their money. If you're going to be in debt, by God, at least you should have an accurate reading of how far in debt you are.
As I went through the document and tried to make heads or tails of it, it disturbed me greatly that there are increases to certain government departments -- to the communications branch, for example. That disturbs me because I have some grave suspicions about what those dollars are being used for. Those suspicions extend to the government's demonstrated practice of using taxpayers' money to trumpet its own story, for partisan, propaganda-type purposes. That disturbs me greatly. The people of British Columbia will take no issue with governments making a legitimate attempt to provide information to the public. They will take great exception when governments use public moneys blatantly, politically and in a partisan manner to get themselves re-elected. That type of practice has to stop, and that shouldn't be done by a government that purports to be spending money wisely.
I am pleased to have discovered that I have been assigned the task of being the Environment critic. I look forward to immersing myself in all of those issues that are so important and that, by virtue of the gathering that took place in front of the Legislature several days ago, are so obviously front and centre in the minds of so many British Columbians. I greatly look forward to participating in the debates in this chamber and to becoming acquainted with members on both sides of the House. I'm not ashamed to acknowledge that I have much to learn, and to assure all members that I will work diligently to learn what I can and to discharge my duties as an MLA, as a critic and as opposition to the government in a responsible manner.
Hon. Speaker, I thank you and all hon. members for indulging me on this day of my somewhat belated maiden speech.
Deputy Speaker: I thank the member kindly for his remarks and acknowledge the member for New Westminster, in response to the throne speech.
A. Hagen: It's a great pleasure for me to enter into the debate today, because I like this budget. My constituents like this budget: I've been on the phone over the last 24 hours, since the Minister of Finance tabled the budget with full disclosure of where we are in the province and where we're going. As a new government coming in after years of a government that grew increasingly tired and out of touch with the people, that transparency in what we've done in these two years is nothing short of amazing. People feel a sense of hope and stability, and a sense of where we're going in the future, as a result of the budget the Minister of Finance tabled yesterday. The people on the other side of our Legislature are grasping at almost anything they can find to try to get a handle on their opposition role, which is clearly something that the opposition is charged to do.
I listened a moment ago to the new member. I was very happy to hear the new member speaking about his riding in his maiden speech. He speaks about all the things that our government is looking at: schools, hospitals and transportation.
Interjection.
A. Hagen: Yes, hon. member, in Matsqui, in that rapidly growing suburb of the Fraser Valley, a community that's changing, the things that are a part of our urban environment in the lower mainland and in Victoria are
[ Page 9586 ]
things that you need, and our government is responding to them.
When we look at this particular budget we know that it's planned to meet the needs that people have said they want us as a government to pay attention to. As I have often said in this House, I don't believe there's any disagreement about those issues, nor do I believe that there's as much disagreement as the rhetoric on the other side of the House might give rise to. In fact, my hon. colleague on the other side of the House clapped mightily at some of the initiatives of our government as he listened to the Finance minister's speech yesterday.
Let's get down to some of the specifics that people in my community call "the right direction." We're going the way that gives us the prosperity that this province is noted for and that makes us the envy of Canada; we're going in the direction that will ensure that the prosperity continues. We've heard a lot about the importance of taxes. Freezing taxes is one way to allow people to plan. It tells them that they are not going to be seeing increases in income taxes and that they don't have to worry for the next three years about Medical Services Plan premiums going up. That's good news for businesses as well as individuals, because many business people contribute to the health benefits of their workers; that's as it should be. Freezing taxes tells people that school taxes across the province are going to stay the same, on average. There won't be increases. It says that there are going to be some measures which provide some tax relief for ordinary working people.
In my constituency, the old constituency of New Westminster, our population is growing. People are moving into the city. Our configuration, our city, is changing. Many people are buying new homes -- not so much single-family homes now, but condominiums, which are still their homes, where the property purchase tax has made a difference in the affordability of those homes. As first-time homebuyers they now will be relieved of that tax. We will see then that the young families coming into the communities will benefit from that direction.
I might note that the car dealers, whose numbers are legion in my riding, are happy as well, because we have listened. We've listened to the people who are affected by our decisions, and we have reversed the decision on the trade-in allowance for cars. Those are just a couple of areas where people have been affected.
More important, perhaps, in my community are some of the changes that affect small business. I believe, because jobs are such an important part of our budget, that the initiatives as they affect small business are particularly important. Over the last couple of years, over 3,500 small businesses have benefited from changes in taxes that recognize that they are the job-generators and that we need to give them the tools in our tax regime and in our regulatory regime that help them. I might note that, like a lot of people, I've dropped in on the U-brew people in my town, who have said: "Look, we're a small business. We're entrepreneurial. We're doing things in ways that are quite impressive to see. Keep in mind that we're employing people and that we are creating business in the Sappertons or Queensboroughs of our community." We've listened to them too around not introducing new taxes.
[5:15]
It's important, as we talk about some of those measures that stabilize and give people a sense of where we're going, that we look at where our spending priorities are. I'm proud to be part of a government that has no question at all in its mind about where those spending priorities are. First of all is the health of our citizens and we continue to provide a third of our budget for the wide range of services that means that our citizens can enjoy the excellent health care provided by so many professionals, by so many volunteers who work with those professionals and by so many services that are a part of the fabric of our province.
It's important to note -- and I think we sometimes forget about this -- that the people who provide those services are workers. They get paid. They spend money in your community and in my community. They are a part of keeping a community healthy. One of my favourite recollections, which certainly gives a sense of proportion for an urban person, was in talking when I was first elected with a rural mayor who said: "If there were three or four fewer jobs in a hospital or school or government service in my town, that's like 150 to 200 people being unemployed in an urban area." Those people are important to the economies of regions as well as for the services that they provide. They pay taxes. They shop. They buy services. They help our economy go around. We are preserving those jobs, unlike Ralph Klein in Alberta, who is in fact cutting those jobs by the hundreds in Edmonton, in Medicine Hat and in Pincher Creek, putting people on unemployment and welfare rather than using their skills to provide essential services for people.
But at the same time we as a government recognize that those services have to be managed carefully, and what we've done is engage in discussions among the players -- government, the practitioners and the consumers of services -- to look at ways in which we can make those dollars go further. I was singularly impressed with the words of the Minister of Finance, who said that studies have shown that by cooperating we might very well save $50 million just in purchasing practices in health care alone. Just imagine what some of those millions could buy for special needs children, for people with mental illness, for mentally challenged people, for people who are seeking to look after their health in their homes -- instead of using expensive services -- and who need more services available to them. We have work to do, but it is within a framework of us assuring that those services are maintained and that we can improve on them by good planning.
The same thing holds true in education, where we continue to fully fund enrolment and provide excellent programs for the most needy children. Our inner city schools funding, which is increasing this year by something like 150 percent, recognizes that if we can provide those services to schools in our urban areas or where children are needy, it pays off in spades for us. It pays off in the children having confidence that their community cares for them and that resources are available.
I'll give just a couple of examples of that, which tell how, when government takes some initiative to use our money wisely, the community picks up the challenge and makes it go even further. It's a bit like the parable of the loaves and fishes: a small amount translates into large volumes of service. Our inner city schools project, along with the school meals project, has inspired in people a recognition that school is only in session ten months of the year -- school is not in session right now in spring break or at Christmastime, and those kids are still needy. As a result of people seeing what happens when services are provided for meals or after-school programs, those communities have taken initiatives to ensure that those services are there during school break time -- recognizing that the kids get from that a sense of the continuity of the community and how the community cares for them. And then their sense of citizenship -- of taking responsibility for their own lives, of
[ Page 9587 ]
working within their community -- is enhanced. All of those things mean that we are providing for children, through our government programs and in cooperation with communities, in ways that deal with the poverty that's there, where we must particularly reach out to those children.
Particularly in the area of education this year, I want to commend and celebrate the initiative our government has taken on skills training. We have been increasing the number of seats available, as they say -- places that will allow people to attend post-secondary institutions. But we have had an enormous challenge in that area; to tell the truth, many parents and students have not been finding the doors open. There will be 8,100 full-time-equivalent places added this year as a result of a special initiative: a two-year program with new money, $200 million that has been earmarked for those programs.
I want to have people recognize that 8,100 full-time-equivalent spaces will translate into many more than 8,100 people getting opportunities for the kind of training that will match their skill development with the jobs in communities. That matches something governments, educational institutions, business and union leaders more and more are seeking to work out: ways that ensure that when we've got a job, then we've got a person who has the training to enter into that job. We have taken the initiatives to make sure that match is there. That 8,100, I'm willing to estimate, will translate into almost three times that number of actual people getting new opportunities. Some will be single parents going part-time; some will take a short course, and then there will be another group of people come in to take that course. So we might actually run courses that, over a year, would serve three groups of people. Some of them in fact will be combinations of work and classroom experience. One of the things I hope this new initiative does is provide for the 75 percent of secondary students who never get to post-secondary institutions but who need the skills training, cooperative education and on-the-job experience that will give them an opportunity to participate in our economy.
Hon. Speaker, the people on the other side have made a great case about how we are managing and accounting for our spending. The first thing I want to say is that we're accounting for it in detail. Any of you can look at the documents; those documents are available to any citizen. They're readable and accessible. They tell you what programs we're spending money on currently, what programs we're buying this year, and what we're buying in the way of infrastructure -- for hospitals, schools and roads -- to service us for the future.
I haven't heard anyone on any side of the House go to the Minister of Education, who's sitting over here, and say: "Mr. Minister of Education, I really don't think you should build my school this year, because we really can't afford to build it." I haven't heard anyone on the other side of the Legislature suggest that we shouldn't build schools in Matsqui, North Vancouver or Richmond, which are some of the communities that they represent. I haven't heard any of them say to the Minister of Transportation and the Minister of Employment and Investment, who is responsible for the B.C. 21 project: "Look, we can deal with secondhand roads and long waits getting to and from work and the environmental pollution that that creates. We can wait until we can deal with all of that out of current expenditures."
Ever since we've been involved in building our infrastructure in this province, we have, as a prosperous economy, taken out a mortgage. The member for Matsqui, our newest member, sits on a school board, and he's taken out mortgages.
Interjection.
A. Hagen: Do you still sit on a school board? That's a good question. I'm not sure whether he is double-dipping at this stage of the game. That's something that he may want to deal with. I would not, in any way, want to comment on the many occupations that he is dealing with at this particular time.
But that member and other members know very well that it is essential that we don't have children spending all of their lives in a portable across a muddy field, because we are going to wait until we have the money in our pockets to pay for that school. A 20-year mortgage is something I'm very comfortable with when it's for the students in my rapidly growing community of Queensborough. I'm prepared to support the schools in any member's riding, because those are very important things for our kids.
Regrettably, none of the people who sit on the Reform or Social Credit side of the House are here to have me once more call them to account for what happened in the eighties. That is an object lesson that none of us in this House should forget. I was a school trustee dueing the five years that the former administration decided that it was not going to build schools, deal with hospital construction or provide the services that we value and continue to provide on a regular basis. If you can believe it, in the last year that I was a school trustee, that group of people provided $20 million for 75 school districts, and they managed to underexpend it by $1 million -- by 5 percent. We don't want to have anything to do with that kind of restraint and blinkered planning.
What we are talking about is a plan for our hospitals, schools, roads and justice facilities. It is just like the plan that my husband and I made when we were first married. We figured out how we could look after our daily expenses, pay a mortgage on a house and plan for our future. That's what a good government does; that's what stewardship is all about. That's what we've been talking about in this budget. That is the philosophy that we as New Democrats, as a movement and a government, believe in.
Consider the fact that we've done this in the face of an off-loading by the federal government. The Liberals who now sit on the other side of the House are the people who started it under Trudeau. They try to lecture us about how we should run affairs. It started there and continued through a Conservative government, which probably covers just about everybody on the other side of the House. I want to be spared from the kind of lectures that they're giving us about debt and management.
It's all here in the B.C. budget. All the details are there. The plan is there. It will be tough, and we will have to manage that plan very carefully. No one has any illusions about that, but we have been upfront about our agenda, and that is to get the deficit down, because the deficit adds to our debt. It is to keep our taxes steady, because that gives people the stability they need to plan for their future. And it is to ensure that every citizen in this province -- young, middle-aged or elderly -- has an opportunity to participate in our economy: good education for our children, good opportunities for people of all ages, abilities and incentives to get the kind of training and education that they need to participate in our economy.
For me, the part of this budget that I am proudest about is that initiative. We all have parts of the budget that we particularly like and want to work with: for me it is that initiative which deals with so many of our young people, who need to have new opportunities in apprenticeship, co-op education, work experience and special skills training.
[ Page 9588 ]
That is a wonderful government initiative that gives people of all ages -- grandparents, parents, young people and workers -- who are looking for retraining some hope that we are on the right track.
[5:30]
In the middle of a term when we came into government when the federal people -- whether Conservative, as when we came into government, or Liberal now -- were determined to push as much down onto us as possible, I think we have done a darned good job, and that's what the people in my community of New Westminster are telling me. I'm proud to be able to talk about this budget in every detail. I'm proud to be able to say that if you want information about this budget, here it is: how we're going to spend it, how we're going to get our deficit down, and how we're going to manage to build up our assets for the benefit of all people. If you've got ideas and suggestions about how to do it well, one of my jobs as an MLA is to work with my community to do that. I intend to do that with all the energy, wisdom and ideas I have. I'll be looking for ideas from my community on how to take advantage of what the government has provided in this budget and of the direction and programs that are supported by this budget.
As I said at the start, I like this budget, and I'm proud of this budget. I feel strongly that it is moving us in directions that are good for our economy and for the province. The naysayers on the other side of the House talk a lot about stuff that is very easy to grasp if we look at what we're doing with our money, which is what we all do. I wish they would join us and look at ways in which we can make sure that the very things they're calling for too -- improvements in their communities, in programs and in health care.... I know that there are lots of ideas over there if they could just manage to forget that their job -- they think -- is to look at what isn't there: a hiding of the truth.
The truth is that this is a transparent budget designed for people. It is designed to ensure that we know where we're going and that, as legislators, we can go out and talk to people about how we will use their money, their taxes and their contributions to the economy in order to make my community and your communities a better place. Join us.
Deputy Speaker: I thank the member for her comments and apologize to her for the fact that I invited her to speak to the throne speech. Happily, she disregarded me and stayed in order by speaking to the budget.
L. Krog: Hon. Speaker, when one has listened to the eloquence of the member for New Westminster, it is always very difficult to start off by saying anything of importance to this House. She has spoken with the usual rationality, common sense and generosity of spirit that has come to be expected of her by everyone in this chamber. That, of course, is in contrast to what we often hear from the opposition.
Budgets are not exciting. I have tried my best; I have spoken to accountants and tried to work up some great fervour over budgets. They're not exciting, but they are absolutely necessary to the governing of this province. The budget fulfils and lays out in clearer terms what the throne speech addressed last week, and that is this government's plan for British Columbia and its progress.
The only thing we achieve of any value in life is that which is achieved over time. Quick solutions very rarely work. What this government has done through several budgets is demonstrate that you can get to good ends only by a long-term strategy, and our long-term strategy is clearly paying off.
When I was campaigning for election, I said to my constituents that neither I nor the government would take full credit for a prosperous economy any more than I or the government would take full responsibility for a bad economy. What the budgets of this government demonstrate -- this one in particular -- is that the government's role in the economy has been handled in the best manner possible. Different approaches have been taken in other provinces. They are not working, and they will not work. The Bennett restraint program is a prime example in the history of this province of how withdrawing the government's responsibility for the economy does not produce good results.
[The Speaker in the chair.]
This government has been able to reduce the substantial deficit inherited from the previous Social Credit administration from $2.4 billion to $898 million for '94-95. It's the best government. The deficit has been slashed by 60 percent in three years. At the same time this province has led every jurisdiction in Canada and most jurisdictions in North America in economic growth, job creation, capital investment and, most importantly, the creation of infrastructure, be it schools or highways or hospitals or long-term care facilities. That represents the best values of our society.
I listened with interest, as I always do, to the member for Delta South when he addressed the House today. I'm always charmed by his wit and, I would say, by his kindness to the government on occasion. He is one of those members of the House who is willing to acknowledge the government when it does good things. I was particularly touched by his Biblical references. I would remind him that there is also a part in the Bible that says that it's easier for a camel to go through the eye of a needle than for a rich man to enter the Kingdom of Heaven.
He talked about our government wanting to punish the successful and reward our friends. We know who the friends of the Liberal Party are. They are the folks who not only won't get into heaven but could never go through the eye of the needle. They are the friends who supported the leader of thatr party in his campaigns. They are the people who do not wish to be known, who do not wish to reveal what they've contributed and who wish to maintain the status quo for their own personal benefit. They are the secret occupants of Howe Street, Shaughnessy and the wealthy areas of this province.
Interjection.
The Speaker: Order, hon. member.
J. Beattie: On a point of order, I hate to interrupt my hon. comrade when he is on a roll, but the hon. member for Delta South is inciting the back bench, particularly the young member for Matsqui. If he is to do so, I wish he would take his proper seat in order that this does not degenerate.
The Speaker: The hon. member has one valid aspect in his point of order. If the member is speaking from a seat other than his own, that is not customary in this House.
L. Krog: Thank you, Hon. Speaker. I'm always appreciative of the concern that my colleagues in this House show for me.
Let's talk about friends. I've talked about the friends of the Liberal Party, and obviously the member for Delta South
[ Page 9589 ]
was talking about the friends of this government. I want to list the friends of our government. They are the poor people in this province, the people and the children on social assistance; the weak and the sick; those in need of education; and working people. The friends of this government are the majority of the people in this province, those for whom we have shown concern in this budget.
Interjections.
L. Krog: It's always a pleasure to address this House, particularly when I incite some interest from the opposition.
The member for Delta South talked about the necessity for tax reform. That is so incredible to hear from the right wing -- the necessity for tax reform. The tax system has been set up to ensure that those who have will keep it and get more of it, and that those who have nothing will have to pay more than they can afford to start with. The member for Delta South is an accountant. That's how they make their money -- protecting the rich and making sure they pay as little tax as possible.
My friends, the friends of this government, can figure out how to do their tax returns. It's quite simple. The leader of the Liberal Party talked about taking the percentage of the government's expenditure from 20 percent of the gross provincial product down to 15. That's what he's talked about outside this chamber. It's reported, and he'll have to acknowledge it. Today, in keeping with the true Liberal spirit of never being able to stick to one position for very long, I heard the member for Delta South say: "We want to reduce it to 18." I guess that's a compromise. I guess that's a switch of position.
What I want to know is: who speaks for the Liberal Party? Is it the member for Delta South, or is it the leader of the Liberal Party? What is it they wish? I guess it's because in my remarks the other day to the throne speech I mentioned what taking it from 20 percent down to 15 percent meant. It meant the closure of all the schools and the hospitals in this province. I guess the Liberal Party has now decided that we're only going to close a few schools and a few hospitals to reach this magic figure. Why do we want to reach this magic figure? Quite frankly, I have no idea.
This government in two years is going to get to a balanced budget. We will start paying down the debt. Indeed, we have already in this budget -- by eliminating the Socred fund, if you will. We will bring down the total debt by over $600 million in the next couple of years. In the meantime we will continue to borrow appropriately, as my colleagues have already articulated in this House, to build schools, to build hospitals, to build roads, to provide the necessary infrastructure of government.
I understand that the vice-president of the Royal Bank, in speaking last year to the Vancouver Board of Trade, said that the role of government is to provide infrastructure. This government has done nothing more than take the advice of the vice-president of the Royal Bank of Canada. Is there something wrong with the fact that government should provide infrastructure? Is there something wrong with the fact that we should educate our children? For two and a half years I have heard a continuing cry from the Liberal Party that we should be spending more. Their former leader talked about the need for a fund to create highways and roads, a financing authority. We've done it, and now we're being criticized for doing it. I simply want to know what the Liberal position is. I don't mind criticism, and I don't mind honest criticism, but I want some from the Liberal Party that is at least philosophically consistent.
Interjection.
L. Krog: My friend says I'm expecting too much. I suspect I am, but it never hurts to ask.
This government is eliminating the deficit in a balanced and fair way. It is doing it in a way that addresses what I see as the major challenge for every government in the western world and, indeed, around the planet for the next decade or two: how to reduce our dependence on unsustainable desires for more material wealth, for more energy and for more of everything. There is no question that that is what governments have to address. Whether it be in taxation policy or the provision of services, we have to spend smarter, and we have to do with less. That's not popular and that's not easy, but what this government is achieving in British Columbia it is doing in the best way possible. We'll get the same results at the end of the day as the slash-and-burn economies of Alberta and other provinces, but we will get there with people and our economy intact, with our education and health care systems intact, and with infrastructure available to carry us forward into the twenty-first century -- an economic engine that will keep this province ahead of every other in this country. We'll be a beacon to the world, because we have addressed needs for sustainability and for looking to the future. We will have addressed our forest problems. We will have solved a lot of difficulties if we are given a chance to do so.
I want to ask my friends in the opposition to join in that, to finally start to give a few compliments to this government where they are due. I haven't heard their position on Clayoquot from them yet. We have heard criticism over and over again about various things, but they have not had the courage yet -- and their Forests critic was here today -- to talk about what their real position is. They're not willing to accept that what the government did there was the right thing. They're not willing to provide the kind of opposition that good opposition should provide.
This budget addresses the needs of ordinary British Columbians. As the member for New Westminster said, it has given them certainty for three years. They now know that taxes are not going up. They can start to plan a little. We've said that to the province as a whole. This is what we're spending on infrastructure. This is when we hope to and will achieve a balanced budget. This is how we're going to do it. Now, let's have everybody play their role. It's leadership, hon. Speaker.
[5:45]
Through the elimination of the property purchase tax for first-time homebuyers, we are providing encouragement for those young people who want to make a home here, so they will be able to buy a home, take pride in ownership and provide some certainty and help to the economy at the same time. In the restoration of the trade-in allowance for automobiles, we are giving a boost to the automobile industry. We're helping mechanics remain employed. We're helping car dealers and the people who work for them. Quite frankly, I would have thought there would have been a thunder of applause from the opposition for that, but I haven't heard one complimentary word. Spiro Agnew said it best: they are "nattering nabobs of negativism." They simply will not get on board.
We have increased the allocation in this budget for education, health and social services. It represents a real cut of 1.3 percent, but it's a lot better than any other province in this country can manage right now. Indeed, it's a lot better than most other jurisdictions. We're able to do that because people have some sense of certainty. They know that this government has a good economic plan. They know that this
[ Page 9590 ]
province has the lowest per capita debt in the whole country. Not including Crown lands, they know that our assets in this province represent some $60 billion. It's there in black and white for the Liberal opposition to read it if they care to. The debt is an issue that we are addressing, but we are addressing it fairly. It is not the great be-all and end-all that the Liberal opposition talks about.
If we took the Liberal approach to the deficit and debt, then in my constituency we would stop building the Island Highway. I would go to my school board tomorrow and tell them to junk their plans for the new schools that are needed. I'd tell the children who have been in portables for years to stay in portables and forget about having a school with washrooms. I'd tell the community organizations that need grants to give culture and life to my communities to forget it, they're going to remain in a wasteland. I'd have to go to the parents in my constituency who want and need to work outside their homes and tell them to forget it, the government won't be assisting with day care. That's the Liberal plan. It's a plan of nothing; it's a plan of negativism. It's a plan that won't do anything for this province or this economy.
In the next two years this government will spend over $200 million extra to create 8,100 new post-secondary spaces in our education system. That means that thousands more British Columbians will have an opportunity to get the training they need to meet the jobs that are being created in this economy. The president of UBC said the other night that a survey has indicated that of the jobs that will be created between now and the year 2000, 47 percent of them will require university degrees -- post-secondary education. And what is this government doing? It is listening to people; it is paying attention to those things. It's not ignoring the future and pretending it's just going to happen. This government has addressed that need for extensive post-secondary education with a meaningful contribution of nice cold hard cash that the universities, university colleges and colleges in this province will be able to use to educate our young people.
B.C. 21 provides funding for a whole series of initiatives that are absolutely necessary to keep our economy rolling along. In addition, the mining industry in this province is going to get the benefit of $18 million of tax incentives. There are 45,000 people who work in the mining industry in this province and they know that they have a friend in this government. We have demonstrated our commitment to the mining industry with that $18 million tax incentive.
We have demonstrated our commitment to the smaller people in our economy by eliminating the corporate capital tax for over 1,000 smaller businesses and reducing it for another 1,000. There is $112 million of tax cuts in this budget. Is there any other province in this country that is providing a tax reduction? A lot of those provinces should be increasing taxes, and taking it from those who have and giving it to those who don't. This province has actually been able to reduce taxes.
Three years of tax freeze, given that our jobs are up and the deficit is down, will mean that three years from now this province will be so far ahead of every other jurisdiction that no one will catch us. I suspect that three years from now, when the Liberals are still sitting in opposition, they, the Reform Party, the Socreds and every other independent member sitting there nattering away, as they have consistently for two and a half years, will have to finally acknowledge that what this government has laid out in the throne speech and that what this government has followed through with this budget is a path to the future. It's a path to economic stability; it's a path to sustainability. It's a path to a future that every one of us can look forward to.
We know what they will be saying three years from now. They will still be whining and complaining. They will still be naysaying. They will still be asking that we cut expenditures somehow, I'm sure, and at the same time put schools in their constituencies. They couldn't possibly come to grips with the reality of who they represent and be forthright. If they would just tell us that they're only interested in looking after their rich friends, I'd accept that. But they're still pretending to be friends of ordinary British Columbians and working people. Three years from now they will still be pretending to be friends, but they won't have been friends. The people of this province will have re-elected this government, because the people of this province will know who their friends are. Their friends are in the New Democratic Party in the government of British Columbia. Their friends are in a government that cares and isn't prepared to engage in slash-and-burn economics; their friends will be well on the road to success in the twenty-first century.
This is a fine budget. I said at the beginning that I couldn't get excited about this budget, because I don't get excited about any budget. But I'm excited enough about this one to spend a bit of time today praising this government and the Minister of Finance for bringing down this budget. I've got to tell you, hon. Speaker, that in conversations with my constituents -- be they small business people, car dealers or working people -- they're pretty happy with this budget. They have reason to be. They're like the member for New Westminster. They're happy with this budget. They like it, and I like it. It's just too bad the Liberal Party can't like it.
Noting the time, hon. Speaker, I move adjournment of the debate.
Motion approved.
The Speaker: Hon. members, before calling on the Government House Leader, I'd like to state that on Monday last, the member for Powell River-Sunshine Coast sought an adjournment of the House under standing order 35 for the purpose of discussing a definite matter of urgent public importance, namely the current status of the Vancouver Island land use plan. At the outset, I should point out that standing order 35 provides a method of setting aside the normal business of the House in an extraordinary situation. At the time the matter was raised, the House was embarked on the throne speech debate -- a debate of wide scope to which the standing orders have given priority over other debates. The throne speech debate has been consistently cited as "an ordinary parliamentary opportunity," which would accommodate the discussion proposed by the member. I would refer the House to Speakers' opinions to be found, among others, in the Journals of the House, page 54. For the foregoing reason, I am of the opinion that the matter does not comply with standing order 35.
Hon. A. Edwards moved adjournment of the House.
Motion approved.
The House adjourned at 5:55 p.m.
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