1994 Legislative Session: 3rd Session, 35th Parliament
HANSARD

The following electronic version is for informational purposes only.
The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

THURSDAY, JUNE 16, 1994

Afternoon Sitting

Volume 16, Number 15

[ Page 12031 ]

The House met at 2:05 p.m.

Clerk of the House: Pursuant to standing orders, the House is advised of the unavoidable absence of the Speaker.

[D. Lovick in the chair.]

Hon. G. Clark: I have several introductions today. First of all, we have a visiting delegation from China. I'm very pleased to introduce to the House, Mayor Bo and Vice-Mayor Li from Dalian. I'd ask all members of the House to make them most welcome.

In addition, visiting in the gallery today are two individuals from Local 516 of the Refrigeration Workers' United Association Union: Rick Seder and John McKnight. I'd ask all members to make them welcome.

G. Brewin: It gives me a great deal of pleasure, on behalf of all of you here, to welcome the Canadian ombudsmen. They are meeting here in Victoria. I would like to name names, if I may: Dulcie McCallum, British Columbia; Brent Parfitt, deputy ombudsman, British Columbia; Roberta Jamieson, Ontario; Barbara Tomkins, Saskatchewan; Gordon Mayer, Saskatchewan; Daniel Jacoby, Quebec; Dr. Guy MacLean, Nova Scotia; Barry Tuckett, Manitoba; Harley Johnson, Alberta; Ellen King, New Brunswick; and Betty Harnum, Office of Languages Commissioner, Northwest Territories. Would the House please join me in making them all welcome.

W. Hurd: I'm pleased to introduce to the House today a group of 60 grade 5 students from South Meridian Elementary School in my riding. They are accompanied by their teacher, Val Hammell, the sister of the hon. member for Surrey-Green Timbers. Would the House please make them welcome to the assembly today.

Introduction of Bills

RECALL AND INITIATIVE ACT

Hon. C. Gabelmann presented a message from His Honour the Lieutenant-Governor: a bill intituled Recall and Initiative Act.

Hon. C. Gabelmann: Bill 36 fulfils this government's commitment to greater direct democracy and greater accountability of our political institutions. It will place British Columbia in the forefront in this area of reform. Bill 36 responds to the will of British Columbians expressed in two referenda in October 1991. It is based on the findings of the all-party Select Standing Committee on Parliamentary Reform that held 25 public hearings and received 172 written submissions from the public, political parties and other interested groups. It reflects research into practices in American and European jurisdictions, and policy papers and presentations from academics specializing in electoral reform.

Bill 36 will demand greater accountability from all elected officials and will enhance accessibility to government for all British Columbians. This bill enables, by regulation, financing and disclosure requirements that will help British Columbia set a level playing field and avoid the experiences of other jurisdictions where use of these initiatives has been dominated by special interests. The government would like to hear from members of the assembly and the public on regulations that will ensure that these grassroots measures benefit all citizens and do not become the exclusive domain of well-financed special interest groups.

Hon. Speaker, I am pleased that members from all parties of the Legislature met the challenge of helping to implement the call to action expressed by British Columbians in the October 1991 referendum, and that at the same time they were able to address the very difficult questions around the introduction of reform measures that develop outside our parliamentary system.

Bill 36 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.

LOWER FRASER VALLEY EXHIBITION ASSOCIATION AMENDMENT ACT

S. Hammell presented a bill intituled Lower Fraser Valley Exhibition Association Amendment Act.

Bill Pr401 introduced, read a first time and referred to the Select Standing Committee on Parliamentary Reform, Ethical Conduct, Standing Orders and Private Bills.

Oral Questions

NANAIMO COMMONWEALTH HOLDING SOCIETY

M. de Jong: Yesterday the Attorney General called for a full and unfettered investigation into the events that occurred following game 7 of the Stanley Cup final. We applauded the Attorney General, because he was right when he said that the people of British Columbia want to know what happened. Well, the people of B.C. also want to know what happened in the Nanaimo bingo scam. My question to the Attorney General is: why did it only take one day for an investigation to be called into the riot, while this government continues to refuse to hold a full public inquiry into the Nanaimo Commonwealth Holding Society, after two years of public demands?

Hon. C. Gabelmann: I will continue to have nothing to say on the matter while it's in front of the courts.

Deputy Speaker: The member for Matsqui on a supplementary.

M. de Jong: I will remind the Attorney General of what was contained in count 8 of the information sworn by Corporal Forster on May 18, 1993, alleging that former NDP MLA David Stupich conducted a charitable lottery in breach of the Criminal Code provisions as early as 1973. In light of these disturbing facts, will the Attorney General now commit to launching a full public inquiry into the activities of NCHS from 1973 to the present? And will he commit to launching that investigation one day after the deadline for appeal has expired?

Hon. C. Gabelmann: Nothing has occurred in the last minute and a half that causes me to change my answer.

M. de Jong: The Attorney General also knows that count 31 of the information sworn by RCMP Corporal Forster alleges that the Nanaimo NDP association has been involved in this Bingogate fiasco since at least January 1, 1973. My question to the Attorney General is: when he announces -- if 

[ Page 12032 ]

he does choose to announce -- that a full public inquiry will be taking place, will he commit that the investigation will look into matters extending back at least as far as January 1973?

B.C. TRANSIT EXECUTIVE COMPENSATION

D. Symons: My question is directed to the minister responsible for B.C. Transit. When the government fired Mike O'Connor as B.C. Transit's president, they gave him a severance package worth more than $460,000. This included writing off his car for $21,000. Can the minister explain how he justifies spending $500,000 as a severance package when B.C. Transit is drowning in red ink?

[2:15]

Hon. G. Clark: I assume the member is talking about Mike O'Connor. I obviously don't get involved in personnel decisions -- the corporation has a board of directors that does that -- nor in negotiations surrounding any severance as a result of contracts entered into by a previous board of directors. The Leader of the Opposition was on the board when his compensation package was arranged, including any severance arrangements which may arise as a result of his departure.

Interjections.

Deputy Speaker: Order, members. We must at least hear the question.

D. Symons: I find his answer most interesting and amusing. After releasing Mike O'Connor, the NDP hired Frank Dixon. Then they fired Frank Dixon and hired Eric Denhoff. When Denhoff quit, the NDP bought him a job with the B.C. Forest Alliance, so now they're still paying his salary. They're being sued by Frank Dixon. And B.C. Transit is being run by a part-time Burnaby NDP councillor.

Deputy Speaker: Question, member.

D. Symons: To the minister: when you add together O'Connor's $500,000 handshake, Dixon's lawsuit and Denhoff's parachute, how much has the taxpayer paid for a transit system that won't even stop to rescue passengers in a riot?

Hon. G. Clark: Unlike some of the arrangements made by the previous administration -- the previous board of directors of B.C. Transit -- no severance arrangements were made for either Mr. Dixon or Mr. Denhoff. In fact, the current chair, who is not full-time -- Derek Corrigan -- has been praised universally by members of all political parties, George Puil in Vancouver and others. I think the Leader of the Opposition is very supportive of Derek Corrigan and generally has been. I hope the Leader of the Opposition is as supportive of that member when he runs for nomination again as he is of Derek Corrigan.

D. Symons: Whether you call it severance or a parachute or whatever, it is money being paid out of the pockets of the transit users of this province. In addition to all of this, this government is responsible for hiring Marc Eliesen and Dick Gathercole on five-year contracts and then firing them after two and a half years. My question is to the Deputy Premier. When you add up all the income guarantees, golden parachutes, pending lawsuits for Dixon, Denhoff, Eliesen, O'Connor and Gathercole, how much money have your ministers wasted on behalf of the B.C. taxpayer?

RATIFICATION PROCEDURE FOR LAND CLAIMS SETTLEMENTS

J. Weisgerber: My question is for the Minister of Aboriginal Affairs. The Treaty Commission process has six stages, as outlined by the land claims task force. Stage two, preparation for negotiations, requires that all three parties have in place a ratification procedure. Will the minister tell us today what ratification process has been adopted by his government?

Hon. J. Cashore: I find it shameful and appalling that the Reform Party has been reported as saying that it is not suitable for duly elected members to be dealing with ratification of such matters.

The six-stage process that has been agreed upon is being followed through appropriately at every stage and in every regard. I would remind the hon. member that the process we have entered into is being followed through absolutely appropriately. I find that the kind of comment that this hon. member is making is fomenting fear and loathing in a most inappropriate and unnecessary way.

J. Weisgerber: This government accepted all 19 recommendations of the land claims task force. Recommendation 13 says that all parties must develop a ratification process prior to entering into negotiations, and those ratification procedures must form part of the treaty framework. Will the minister tell us today what ratification procedure this government has adopted, and what ratification procedure will be enshrined in the framework agreement? Who's going to ratify the claims?

Hon. J. Cashore: Hon. Speaker, I told this hon. member two days ago that this would be ratified with the process of reporting to cabinet and to the Legislature. I find it appalling that he would suggest that duly elected members are not appropriate members to be dealing with the ratification. Further to that, as the former Minister of Native Affairs who brought this province into treaty negotiations with the Nisga'a, the member knows full well that he signed the confidentiality process that was part of that, and he set that tone. He knows that. This hon. member was doing very well. He was starting to understand this justice issue, and he has become a backslider. He's a backslider, and he does not....

Interjections.

Deputy Speaker: Hon. minister, will you wrap it up, please.

Hon. J. Cashore: It is simply not acceptable that this type of opportunistic approach would be taken by the Reform Party at this time. It is very different from the approach the hon. member was taking before.

Deputy Speaker: The member for Peace River South on a supplemental.

J. Weisgerber: It has been a while since I've had that kind of sermon, but I suppose the minister's previous vocation shows through.

Interjections.

[ Page 12033 ]

Deputy Speaker: Members, we know it's the end of the week, but please grant the member the courtesy to ask the question.

J. Weisgerber: Mr. Speaker....

Interjections.

Deputy Speaker: Members, please allow the member to pose his question.

J. Weisgerber: If the minister believes there's a confidentiality agreement around the ratification process, he really is mixed up. He doesn't understand the process at all that his government agreed to. The Northwest Territories and the Yukon gave all residents of those jurisdictions an opportunity to vote on the land claim agreements reached.

Deputy Speaker: May we have a question?

J. Weisgerber: Will this government have the courage to extend that same right to British Columbians in the areas affected by claims?

Hon. J. Cashore: The hon. member knows full well that the Treaty Negotiation Advisory Committee is in place. He knows full well that there are going to be advisory committees in every region that will have direct contact with the negotiating teams. He knows full well that the Premier has stated his position that local governments may acquire observer status at the negotiating table with regard to issues directly affecting them. He knows full well that those processes are in place. Because of expediency, this hon. member has backed off from the position he was taking before. I think this hon. member should publicly distance himself from the remarks of his colleague, Herb Grubel of the Reform Party. Expediency will no longer work, hon. member. Make your statement and distance yourself from those racist comments. [Applause.]

B.C. 21 CAPITAL INVESTMENT PROJECTS

F. Gingell: Thank you, everybody.

Recently the Minister of Employment and Investment was quoted as saying: "God, we're shovelling money off a truck." Of the $1 billion in capital projects announced in addition to the Island Highway, 90 percent are located in NDP ridings. Will the minister admit that his intention is to use B.C. 21 only to pay for more special favours for his NDP friends?

Interjections.

Deputy Speaker: I would like to advise all members that their enthusiasm is taking time away from question period. Having said that, I recognize the Minister of Employment and Investment.

Hon. G. Clark: It's not surprising that members of the Liberal Party would be concerned about B.C. 21 initiatives, because they voted against it in the House. They stood up and said they were opposed to capital investment and this kind of investment in province-building. Having voted against it in the House, however, that member is quite happy when a B.C. 21 grant goes to the Tsawwassen Lawn Bowling Club in his constituency. He is quite happy to support investments in his community and lobby the government on its behalf.

Hon. member, we have made community grants in every region of the province and in every constituency regardless of politics. I commend the member for supporting his constituents when they come forward. The fact that 75 percent of constituents in the province are represented by New Democrats is no fault of those who actively advocate on people's behalf.

Deputy Speaker: I am going to allow a supplemental.

F. Gingell: The minister makes a great point of talking about doormat community grants when he knows perfectly well that we were talking about major capital projects. Last year this minister announced that these funds would go to help all regions of this province, but 95 percent of the $83 million in community grants that were announced this past April...

Deputy Speaker: Member, I said you have a supplemental, but you must ask a question.

F. Gingell: ...will be going to NDP ridings. When did the minister decide that he's responsible only for helping his NDP friends?

Hon. G. Clark: It's interesting. Is the Liberal Party opposed to the Island Highway? Are they opposed to commuter rail? Are they opposed...?

Interjections.

Hon. G. Clark: The answer is yes, very clearly. Are they opposed to $600 million in school construction this year, much of this in high-growth areas like Tsawwassen? Is the member not supportive of the east Ladner bypass? Is he not supportive of the south perimeter road? Is he not supportive of investments on the north side of the Alex Fraser Bridge that will benefit his constituents? They want to stand up in the House and oppose B.C. 21, oppose capital investments, oppose the Island Highway, oppose commuter rail, but say that we should do the projects in their constituencies.

Deputy Speaker: I'm sure that if I extended question period, I would be accused of being partisan.

Orders of the Day

Hon. G. Clark: In Committee of Supply, Section A, I call the estimates of the Ministry of Forests. In the main House, I call committee stage of Bill 46.

[2:30]

CHILD, FAMILY AND COMMUNITY SERVICE ACT
(continued)

The House in committee on Bill 46; D. Lovick in the chair.

R. Chisholm: I would ask leave to make an introduction.

Leave granted.

R. Chisholm: I'd like to introduce 40 grade 7 students from Tyson Elementary School who are here with Mr. Wallace. They're in the precincts today to see how things operate in Victoria, and hopefully they'll learn about our 

[ Page 12034 ]

parliamentary system. Would you make them most welcome.

On section 20 (continued).

J. Tyabji: I have reviewed Hansard from before the adjournment, because I did leave five minutes before adjourning. I just want to reassure the minister that I won't cover anything that has already been done on this section.

The last question I asked before we adjourned was with respect to the family conference. I'd just like to get this firmed up, because when we get to later sections in the bill, we know that the aboriginal component begins to play a very significant role. The minister has said that the person who convenes the conference -- I've assumed that is the director, and I haven't been contradicted -- is the keeper of the process and that the agenda is set by the participants. The question I have on that point is fairly simple: who decides who is at the table? I asked this just before I left, and I would like to know. In the case of the child the conference is convened around, if that child has been defined, for the purposes of this bill, as aboriginal, to what extent will someone other than the parents be determining who sits in on a family conference?

Hon. J. MacPhail: The conference coordinator and the family.

J. Tyabji: With respect to my final question on this section, we see under 20(1): "The purpose of a family conference is to enable and assist the family to develop a plan of care that will...(d) take into account the child's culture and community." If it is an aboriginal child as the minister has defined for the purposes of this bill, if the aboriginal community is the one designated by the minister, and if a plan of care has to be developed according to these guidelines and taking into account 20(1)(d), would there be an example where the family conference would be convened and the director, who would be helping to set the agenda in consultation with the family, would be making recommendations to bring into the family conference -- dealing specifically with this as an aboriginal issue, because that's how the bill is written -- someone from the aboriginal community, even when that is not necessarily the wishes of the parents?

Hon. J. MacPhail: No.

Section 20 approved.

On section 21.

V. Anderson: I move the amendment standing in my name on the order paper.

[SECTION 21 (3) (a), to be amended to read: (3) If the child is 12 years of age or over, the director must before agreeing to the plan of care (a) explain the plan of care to the child in the presence of another adult, preferably known to the child, and]

Once again I am concerned that the child have support and not be left on their own, so I have moved that amendment. I think it's important, or preferable, that the person be known to the child; but even if a person known to the child isn't there, there should be another person to help with the explanation. It's important that there be more than one person involved.

On the amendment.

Hon. J. MacPhail: I appreciate the suggestion, and one of the reasons we're going to take some time to implement this act is so that the practices that flow from the substantive policy issues of the act are put in place with the greatest of consultation and care, to ensure the greatest success. So while the member makes good suggestions by amendments to the act, I think it best that we deal with this through practice. Already in this act, we have incorporated the new fact that the child's views have to be taken into account and the plan of care actually has to be explained to the child. That's a breakthrough. The issue of how we do that is really a practice issue, and I would suggest that we would definitely take his views under advisement when we implement the act. We'll have months to make sure it's done properly.

V. Anderson: I think it's important. There are a variety of possibilities: one is language differences; there are always cultural differences; and even if the persons are of the same culture, they may have come from different backgrounds. So it is extremely important how that explanatory interview is undertaken.

R. Neufeld: I want to stand in support of the amendment. I think the member brings forward a good point. To explain the care of the child in the presence of another adult, preferably known to the child, is a good move. I can't see where that would change the intent of the legislation at all. All it does is set in place the fact that we're going to be receptive to some of the concerns of those children who are being placed in care. I think we all know that some 12-year-old children may be very afraid if they're by themselves, but if they're with another family member -- a grandparent, say -- or someone they know really well, maybe they could understand it a little better. I don't think it would change the intent of the bill at all.

Hon. J. MacPhail: No, and I didn't mean to indicate that it does change the intent of the bill. But what we are discussing here -- and I understand that it's complicated, because we are changing not only the act but also the way we do our business, and therefore the way we deliver our services -- is that we've got to be careful not to entrench practices in legislation, because if practices change, then we have to amend legislation. All I'm saying is that this is a policy and practice issue. The views are well known, and certainly I don't disagree with them. I also remind the members that we will be debating a piece of legislation where we're instituting, separate and apart, a whole independent advocacy system for children, which can be made use of, perhaps, in planning for this.

J. Tyabji: I'd also like to speak in favour of the amendment. Notwithstanding practice, any director or fieldworker of Social Services is going to be looking to the bill, obviously, for some guidelines as to how they operate. We know there are many examples where an educational program -- such as the controversial CARE program that used to be in the school system -- can have an impact on a child. A child could easily be in a session where a director is explaining to the child why there are reasons for acting a certain way. In absence of another adult, there is no balance to what the child is being told. Although the child may have reached 12 years of age.... I find it ironic that when this government brought in the amendment to the Infants Act, they said that under the Charter of Rights, an arbitrary discrimination on the basis of age was unconstitutional. Yet here we've got an 

[ Page 12035 ]

arbitrary discrimination on the basis of age. The bill assumes that once a child is over 12 years old, that child has the mental capacity to automatically understand what they are being told by the director. That could be a very traumatic period, so somebody else who has a vested interest in the rest of that child's life should be present at that meeting.

[2:45]

Amendment negatived on the following division:

J. Tyabji: Subsection 21(1) says: "The plan of care developed by means of a family conference must include the director's consent...." What does that mean?

Hon. J. MacPhail: The plan of care has to be agreed to by the director, so that we ensure that it actually meets the needs of protecting the child and preventing the child from being at risk, and that a plan of care that includes provision of services is able to be offered.

J. Tyabji: As I understood it, the family conference is a voluntary consensual arrangement. I'm wondering why, under this section, it says that it's something that the family volunteers to be involved in. It says that it "may include provision for services to support and assist" and make them safe, so after a family conference you could actually end up with a plan of care that requires no government intervention whatsoever. Why would this be worded so that a plan of care like that must have the consent of a director? Why wouldn't there be something, for example, that would say that if there is a financial obligation on the part of the government, then it would require the director's consent, rather than saying that any agreement coming out of this conference requires the director's approval?

Hon. J. MacPhail: We are talking about children who may be at risk and who may be in need of protection. This is to confirm that the plan of care developed by the family conference meets those needs -- to confirm it in a professional way -- and, if there are some services offered that don't require any government intervention, that those services meet the needs of protecting the child. That's it; it's fairly innocuous.

V. Anderson: On the same concern, I understand and appreciate the kind of backup protection this indicates for the responsibilities of the ministry and also for the responsibility of the child and family. But there is also the danger that.... If the mediation conference comes to a plan of care and the director overrules that plan of care, where do you go for an appeal? You have then set the ministry and the government against a mediation plan which has been worked out by the parties involved. So there is a great deal of danger, unless there's a way to appeal the decision. If the director vetoes the plan of care, the consequences can be devastating to everybody concerned.

Hon. J. MacPhail: It is achieved by consensus, and everyone, not just the director, has to consent. The family conference will go on until we achieve everybody's interests in this. In other jurisdictions where it has been used, that is exactly what has happened. So you continue to work at it until it meets everybody's needs.

J. Tyabji: What happens with the plan of care? Is that registered with the ministry? Does it have any weight in law? Is it something on which a court order could be based afterwards?

Hon. J. MacPhail: It could be.

J. Tyabji: It could be the basis for a court order. However, once a plan of care has been hammered out and has the director's consent, is that something that stays...? Is there a registry of plans of care or something like that in the ministry that would set a precedent? Is there a formula for them?

Hon. J. MacPhail: No, it's an individual plan of care, particular only to the child or family to whom it applies.

J. Tyabji: I guess if it is something that may be used as a basis for a court order, it is understood why you might want the director's consent. Maybe this isn't possible, but would the minister acknowledge that there could be a family conference convened and at the end of it there could be no resolution? Since it's a voluntary process, I would assume that the family can withdraw from it at any time and make their own arrangement about what they wish to do. Is that a possibility?

Hon. J. MacPhail: The family can withdraw from a family conference at any time. However, the decision about the child at risk and protection matters won't be left with the family.

J. Tyabji: Maybe the minister can help me understand this. Because it's under "Cooperative Planning and Dispute Resolution," I assume that a family conference is not necessarily for children in danger; but it could be for families in difficulty, because when we started this debate the minister spent a lot of time talking about families in difficulty. What I'm trying to understand is.... If they can solve the difficulties on their own, they can opt out and then this ceases to apply. I'm hearing the minister say, though, that if they do opt out of this process once the process has begun, the director can continue to intervene if the director chooses to do that -- notwithstanding the family self-determining or resolving their issue.

[ Page 12036 ]

Hon. J. MacPhail: When a family conference occurs as a result of a child protection concern, the family can opt out, but then the director has further responsibilities. If a family conference is convened when there are no concerns about protection, the family can opt out and that's it -- there is no further intervention.

J. Tyabji: Is there a possibility through this process that the family could opt not to have something that would require assistance or intervention of the government, but to provide some evidence of resolution to the director for the purposes of ending the file -- for example, when the purpose is a family conference, where they don't necessarily want the consent of the director or any government assistance. They've recognized and are prepared to deal with the issue on their own and provide evidence to the director. If so, could they register their own plan of care, independent of what the government might offer?

Hon. J. MacPhail: Yes.

V. Anderson: I'd just like a simple clarification. In subsection (4)(b) there's a limitation of 18 months for a plan of care. I presume that after the 18 months a new plan of care could be developed, and it would then be ongoing as well. It would have to be redeveloped as a new plan of care, to deal with the circumstances at that point.

Hon. J. MacPhail: Yes. That is intended to say that after 18 months we should have some resolution to the child's life in a meaningful way -- and that could be one option.

Section 21 approved.

On section 22.

J. Tyabji: I just have a point of clarification. Where it says "or other alternative dispute resolution mechanisms...." Well, I guess I have two questions. First, the minister said a family conference will continue to operate until a point where they've reached consensus, so everyone's interests have been met. Obviously there will be times when a family conference will not be able to do that, and that's why this section is here. So in a way it almost contradicts a bit of the debate we had before. If they're not able to resolve an issue through a family conference, I assume this is when section 22 kicks in. When it does, what is an alternative dispute resolution mechanism other than mediation?

Hon. J. MacPhail: Sections 21 and 22 are separate alternatives that are not necessarily connected and not necessarily done in isolation either. One doesn't necessarily follow the other.

Other kinds of alternative dispute resolution mechanisms that could be intended here could be culturally sensitive about.... Just dispute resolution mechanisms accepted in the family's culture that aren't mediation -- I don't have examples. We don't want to limit those, though. We want flexibility.

J. Tyabji: Sections 21 and 22 may not be connected, which means they can bypass the family conference and go to mediation as an option if they can't resolve an issue. It could be mediation or an alternative dispute resolution mechanism that would be based on culture. But there are no examples, because the minister doesn't want to limit it.

[3:00]

Maybe I can ask if an alternative dispute resolution mechanism.... Are we talking about court action? Are we talking about community intervention? The only reason I'm asking is that I don't understand what it means. Perhaps there could be an example that doesn't limit the usage but gives an idea of what we're talking about.

Hon. J. MacPhail: It could be anything that brings people together to resolve a dispute. We didn't want to limit our flexibility in this area. I gave cultural sensitivity as an example, but it's not limited to that.

Section 22 approved.

On section 23.

R. Neufeld: I have a couple of brief questions. Section 23(1) says: "On application the court may adjourn a proceeding...." It doesn't designate who makes application to the court. Can anyone from the family conference unit make application to the court?

Secondly, in section 23(3) it says -- I'm just reading the last sentence -- "if the child needs protection, a director may file the agreement with the court." Why is the designation "may" file? Should it not be "shall" file?

Hon. J. MacPhail: On the first question, it's anyone who is proceeding.... A participant can make an application to have the court adjourn.

Under subsection (3), the reason it's permissive is that the agreement reached may require that people never go back to court -- that it's satisfactory that people not go back to court. Therefore that's the end of it; the resolution has been reached. However, the sanctity of the court may be necessary in some cases in order to ensure that participants live up to their agreement.

R. Neufeld: Then, under subsection (1), members of the family conference can make an application to the court. Should that not be spelled out a bit differently in the legislation? It just says "on application." It doesn't designate -- or come close to designating -- who. If it is the people who are in the family conference, then possibly that should be designated in the legislation.

Hon. J. MacPhail: The people are already before the courts, so there are already parties before the courts. This kicks in when those parties to the proceedings, who are already there, want to adjourn them so that they can go into the other sections. It's already presumed. In fact, the way the legislation reads is that it's the applications from those who are already before the courts.

J. Tyabji: Section 23(1) says: "On application the court may adjourn a proceeding under this Part one or more times...." We said family conference and mediation are not necessarily linked. We know that a family conference may be something registered with the courts if there is a plan of care. I probably should have asked this under the other section, but for the purposes of this section, I would imagine mediation may end up with a plan of care as well. That plan of care may also be registered or used as a basis for a court order. Is that correct?

Hon. J. MacPhail: It may, yes.

[ Page 12037 ]

J. Tyabji: In that case, if after the.... Maybe this has already been answered; I did miss a minute of the previous debate. If the plan of care that results from either a family conference or mediation can be the basis of the court proceedings, which would be filed with the court, would that also then take the place of the proceedings prior to that? Would the court proceedings that were adjourned then be replaced by the plan of care?

Hon. J. MacPhail: The process is a continuum wherever we can avoid court. Whatever part of the agreement can conclude court matters or resolve part of the issue that doesn't require further court action, then that part of the agreement stands. The agreement doesn't necessarily become the full court order.

J. Tyabji: For the purposes of this section, I understand the reluctance to deal with the courts. I think mediation and family conferences are the best ways to go -- and I've said that on the record, provided it's the family determining that itself. Having said that, if court proceedings are underway, and those court proceedings are adjourned and another process is used to come in with a plan of care, there would be two aspects. One would expect that the substance of the court proceedings would form the basis for both of those processes. The plan of care would automatically take into account the substance of the court proceedings, or the mediation would take that into account. In order to secure the process of mediation or plan of care, one would hope that that plan of care would be entered in the court proceedings and registered, so that there wouldn't be the opportunity for one party to renege on the agreement.

[M. Farnworth in the chair.]

Hon. J. MacPhail: Yes.

J. Tyabji: I don't know what that yes was in response to. Does that mean it's a good idea to have the plan of care registered? The reason I'm asking is that you don't want adjourned court proceedings to pick up where they left off and not have the plan of care on record as part of those proceedings.

Hon. J. MacPhail: You have outlined a scenario under which a plan of care can be concluded, and you have an understanding of how that takes place. That was what I was saying yes to.

Interjection.

Hon. J. MacPhail: The family may never be before the courts again. The matter may be concluded, and there may not be a necessity to go back to the courts. But if a court order is issued, so be it. There are circumstances under which you may not have to go back into court to have the agreement stand. This concept is not unusual in other areas of law either. I say this with the greatest of respect. We are not breaking new ground on this matter.

J. Tyabji: Perhaps we could break a little bit of new ground here; I think it would save the province a lot of time and money. Let me give the minister a specific example. One reason that I am fairly familiar with this is that I have been through it myself. You go through the process of mediation, there is something filed with the court at the beginning, you hammer out a mediated process, and it doesn't get registered with the courts. If you end up in litigation, none of the mediation gets entered into the court proceedings. It's a complete waste of time. The security you felt at the end of that process is gone and you end up with litigation and something totally different. If you have the ability to enter it in.... Either the court proceedings become part of the mediation or, conversely, the mediated result gets entered into the courts, so you're not vulnerable.

Mediation tends to take place on the basis of good faith. Litigation is an antagonistic process. If somebody -- for an emotional reason, for a day -- decides to go back on a good-faith mediation and go through a litigation process, it's almost a.... Once litigation begins and you go back to the courts, it's almost out of your hands, because the litigation process churns its way through -- bad faith is generated and it escalates. For the purpose of protecting the good process, if court proceedings are underway, it should definitely be entered in the courts. Otherwise you will end up with the good faith having no weight in law, and the court proceedings begun under this section not being updated by the plan of care.

Hon. J. MacPhail: I'll try this one more time. The family conferencing or mediation may resolve all or part of the issues that are before the court, and there may not be any necessity for the court to intrude any further. We are trying to develop legislation that is the least intrusive in families' lives. That's what I've heard from the hon. member over and over again: stay away if you can. The agreement may form all or part of a court order, or it could stand in lieu of a court order, and the court application would then be withdrawn.

I understand that the hon. member, speaking from personal experience, has had situations where agreements have broken down. I don't know how to reply to that in light of this legislation. I'm saying to you that the agreement stands. If it is necessary that an agreement carry the weight of a court order, the court will order that; however, if it's not necessary, we won't go back into court to get that.

Section 23 approved on division.

On section 24.

V. Anderson: There are some concerns with section 24(1), the confidentiality provision, concerning whether or not one who is part of the family conference is able to discuss their own personal needs outside the conference with a lawyer or advocate of their own. Or does this prevent them from getting and maintaining the kind of resource or advice they might have?

When you jump ahead and look at section 76, it is on the "right of access and right to consent to disclosure." It says here that section 24 applies despite sections 76, 78 and 79. In section 76 an individual can give consent to disclosure, but that right seems to be overridden by the statement in section 24: "...(a) with the consent of everyone who participated in the family conference...." If a person participating in a family conference wishes to get some advocate advice or help outside the conference, then they need to be able to share their opinions with their lawyer. If we take the case of a youth who has a youth advocate working on their behalf and who may not be part of the family conference, and if that person wants to be able to discuss matters from their point of view, are they prevented from discussing what happens in the family conference with their advocate or with their lawyer? They would have the ability to work it through and 

[ Page 12038 ]

think it through for themselves in order to participate meaningfully in the family conference.

That's why I move the amendment standing in my name on the order paper.

[SECTION 24, to be amended by adding the following subsections: (2) This section does not prevent a person from subsequently sharing his or her personal information with his or her advocate or lawyer as needed. (3) This section applies despite sections 76, 78 and 79.]

The amendment says that subsection (2) become subsection (3) and that there be inserted a new subsection (2): "This section does not prevent a person from subsequently sharing his or her personal information" -- not other people's -- "with his or her advocate or lawyer as needed." It leaves it open for them; it doesn't prevent them from doing that.

On the amendment.

Hon. J. MacPhail: Section 24 is to capture the confidentiality of the negotiations or discussions that take place during the family conference or mediation. That's what confidentiality is about. One cannot take away anyone's right to his or her own personal facts and how that person may use those personal facts outside the conference. The example that you bring forward is not affected by this language. This section would come into force if someone were about to reveal the nature of the mediation that would take place -- actually, that's inappropriate. No, every individual has a right to take his or her own personal information away and deal with it as is appropriate.

Amendment negatived.

J. Tyabji: A quick question to the minister. We dealt a little earlier with solicitor-client privilege. In a case where a lawyer has been retained by the person to act on their behalf throughout the proceedings, or in court proceedings -- or however it works -- to what extent would a person who participated in a family conference not be allowed to discuss with their lawyer the impact of that participation on court proceedings, litigation or whatever the lawyer was involved with?

Hon. J. MacPhail: The intent of section 24(1)(b) is to cover the circumstances the member raises. If the person needs to make arrangements for his or her personal circumstances, in light of the conference, it's covered by that section.

[3:15]

Section 24 approved.

On section 25.

J. Tyabji: This section is very bothersome to me in a way. Perhaps the minister -- especially the Minister of Social Services -- could help me with it. What comes to mind is families in poverty and especially single parents, many of whom live below the poverty line. I would worry about a parent who may be very loving but who has minimal resources and cannot.... We know there is a growing problem with latchkey children. As heartbreaking as that is, the parent may be providing a loving environment and the best environment they can, given the condition of poverty. The Minister of Social Services knows probably better than any other member of cabinet that many families are living in poverty. Many times children are not adequately cared for, not because the parents don't want them to be but because the resources are just not available. The government would probably go bankrupt living up to the expectations of neighbours, for example, about how children should be cared for.

The reason I raise this is that throughout this bill we've argued over the discretion of the director and the ability of a third party to report an allegation of the negligence of a parent. It would seem to me that if it was a busybody neighbour, almost every poor parent could be reported under this section. Section 25(1) says: "If a child is found without adequate supervision when premises are entered...." This bill is actually written so that a director could be informed by a neighbour that there is a problem with a child. It could be because the parent could not afford to have someone help out. The director could enter the premises, find a child -- such as a latchkey child, whose parent cannot afford to have someone there -- and seize the child.

It's not that anyone in this House would support children being unattended. But the way it is worded.... To me, a child who is being raised in poverty is in a difficult enough situation, without being removed from a loving parent who may be doing their best to provide for that child. I raise this because I think the issue of family poverty is going to be very much with us in the next decade. I'd like the minister's reassurance that this section couldn't be used against the very poorest in our society to basically further traumatize a family that may be in economic difficulty.

Hon. J. MacPhail: In fact, the member outlines exactly the kinds of circumstances and changing economic situations for which this clause is intended. Under the act by which we now live, the child would have to be apprehended, and there would be the severe consequences, not only for the parent but also for the child, of having to go through court proceedings. This is to deal with the kind of situation that she so aptly outlines, in an exactly accurate way. It's only if the child is found without adequate supervision. There are different ways of providing adequate supervision to a child. In any case, if that supervision is inadequate, it doesn't necessarily mean that the child is immediately apprehended. In this situation, we are allowed to ensure this child's safety and at the same time use other sections of the act, short of removing the child from the home in a detrimental way. It allows us to give those support services -- homemaker services, etc. -- that may be needed in the circumstances. It is the supportive clause that the member outlines.

J. Tyabji: So when I read the rest of this part of the section, the homemaker is someone.... If we assume that it's a working parent or a parent who has to go out of the home, and if it can be determined by the director that there's not adequate supervision -- it could be a case where the parent has not been able to provide supervision for economic reasons -- then would the Ministry of Social Service's role be to assist the parent with a homemaker? Would it be in cooperation with the parent? What I would be worried about is the self-determination of the family. Adequate supervision is really in the eyes of the beholder. How would that work out?

If it turns out that the parent is already on social services or is a member of the working poor, to what extent would this affect the overall family income? We know that there are some examples where, if a parent is on social services and has whatever obligations outside the home, sometimes Social Services compensates with other money that is then 

[ Page 12039 ]

deducted from the money they get otherwise. To what extent is this going to be imposed, and to what extent is it going to be in cooperation with a parent who may be part of the working poor or already on social assistance?

Hon. J. MacPhail: Under this section the services are supplied, but not by income testing. It is possible for the agency offering the service to move right into the home, in homemaker fashion, for up to 72 hours, during which time we hope to have contact with the parent in order to arrange for ongoing support in an agreed-upon fashion.

V. Anderson: In the same discussion, I've had concerns brought to me that other definitions are being suggested here. In one case, for instance, you have a 12- or 13-year-old who is a babysitter in their own home. If that 12- or 13-year-old is babysitting younger children in their home, is that considered not giving good care? Or a 12- or 13-year-old -- which is a high school student, perhaps -- is out babysitting in somebody else's home. Are they not giving good care? When you're talking about a child under 19, under 16, under 13, under 12, you're on the borderline of also saying indirectly that children are not recognized and qualified to be babysitters. If you've hired your neighbour's son or daughter or your own older child to babysit, you could be in contravention of the act. That's one concern.

The other concern is that many people from other cultures, immigrants who have come into our country, have children who have been through unbelievable circumstances. They've learned to cope very well and very independently at a very young age and are able to look after themselves very well; they've survived war and famine and other kinds of things. Yet somebody may come in and look at that and say: "No, you're not able to cope." How do we deal with the cultural differences, on the one hand, and on the other hand, the whole question of babysitting and disqualifying many who would like to babysit?

Hon. J. MacPhail: It is only because of my babysitting earnings that I am here today, so we would definitely not intervene in that.

This whole section will only come into effect when a concern has been raised by others about the lack of supervision of a child. We all know that our neighbours and our communities often provide babysitting for children -- even a neighbour watching a couple of homes after school or whatever. It's when the concern is raised and it is determined that there is a lack of adequate care.

Throughout the act the principle of cultural diversity is well established. This section is only there for the protection of children who don't have any of those kinds of provisions.

Hon. Chair, I seek leave to make an introduction.

Leave granted.

Hon. J. MacPhail: I'm pleased that some of the staff of the ministry have joined with us today to listen to the debate. We have some of our many expert and very valued staff, particularly today from the family and children's services division and the aboriginal services teams. I'm so glad that they're able to join with us here for the debate. Would the House please make them welcome.

V. Anderson: I'm delighted the staff are here, too, because they can help and hear firsthand what concerns we're trying to bring, which the community has brought to us. I think the staff need to hear that, from our point of view, we're generally in favour of the bill and are delighted with the direction in which it is going in response to the community, but we want to make sure about that in some directions.

If I can take for a moment the experience that so many people have had who will be dealing with this bill out in the community, some of the concern comes from their experience with the GAIN Act. They have had more difficulty with the regulations and the interpretations of the GAIN Act than they have had with the act itself. Time and time again, the appeals have been won because the act was in favour of the appellant, but the regulations which limited and enforced certain interpretations were not in favour of the act. Either the regulations tend to extend the philosophy of the act in practical situations, or they tend to limit and bind the act so that it can't do what it's intended to do.

I think what we're stressing here, at least from my point of view, is that the issues raised need to be fairly clear, so that when the regulations are given.... I appreciate that the minister emphasized the word "adequate" in this. "Adequate" can be defined in a very narrow sense or it can be defined, as the minister has been doing, in a broad and supportive sense. I trust that the regulations will continue to define it in that broad and supportive sense rather than the narrow sense, so that some of the examples that we've been using today will be not be frowned upon but included and given the kinds of support they need. So the act very much needs to be interpreted, and the regulations need to be written, not in the legal but the philosophical sense that the minister is putting forward.

Hon. J. MacPhail: Yes, that's an excellent point. This part of the act will not be regulated; it stands on its own. Your point about interpretation is a legitimate one. In terms of the practice or implementation of this section of the act, I know that you have outlined a wide range of circumstances that we already deal with in an appropriate, supportive fashion in our practice, and we will continue to do so. What we now have available to us, though, are mechanisms that are legislated -- which is good news.

V. Anderson: I just have to comment. I believe the minister herself, and others within the ministry staff, are trying to move in new directions. Community members, who have lived for years under other directions, still aren't experiencing that in a large enough manner to begin to really believe it. So the concerned people that I've talked to can't say we're doing it, because at the moment they aren't seeing it being done. The community hears it's going to be done, but as yet they aren't feeling or seeing in large part that it is being done.

Hon. J. MacPhail: Yes. In fact, while many staff are moving in that direction, they haven't had the legislative support behind them to do it. There have been less supportive messages in our previous legislation. We're now trying to do exactly what the hon. member says: legislate the new way of doing things.

J. Tyabji: Before starting, I'd like to welcome the staff here as well. It would be nice if we could sometimes have more staff input into the debate.

[3:30]

Under section 25, the minister has said that this section of the act will not be regulated and that we will just be reading the legislation. I note that the director may authorize a health care provider.... In the absence of regulations and based on this bill, to what extent will the parent have any input in 

[ Page 12040 ]

determining who the health care provider will be? As the minister has said, that person may move in with the parent.

Hon. J. MacPhail: The parent isn't present. We're trying to cope with the child's lack of adequate supervision in the absence of the parent. Just on observation of the child, there may be a determination that some health care needs have to be attended to. The parent isn't there to tell us about that, so we may have to invoke this section of the act.

J. Tyabji: When we started the debate on this section, I was talking about latchkey children and children of a single parent who might be part of the working poor. If there has been a report of negligence under this act, and the director enters the premises and finds the child unattended, as I read this section, the director has the option of arranging for homemaker services. Perhaps I'm wrong in taking this from this section, but I assumed that that meant a parent who was there but could not be there full-time, or who was working part of the time. If there were a latchkey child and the director found that the child was not being supervised while the parent was at work, and that parent intended to continue to work but could not afford someone to supervise the child, would the director step in? Or would the director see that as a situation that did not need intervention?

Hon. J. MacPhail: This section is really intended to go much beyond latchkey children. The reality of the world is that children are left alone and are abandoned for short periods of time by their parents for various reasons that aren't -- and I say this with the greatest respect -- as noble as the hon. member outlines. It is in those circumstances that we are trying to support the child and not disrupt the whole family at the same time -- when we can get in there and, perhaps when the parent returns, provide some services in the way of drug and alcohol counselling or in-home support services.

The situation that the hon. member addresses -- in the ordinary course of events, a parent paying for care and attention for the child in the time between school ending and the parent returning from work -- is not the kind of circumstance which our ministry deals with on a regular basis. If indeed a situation comes to our attention, where a neighbour decides that that kind of arrangement needs to be looked into, we may look into it. If it isn't literally adequate in the broadest sense, we may assist the parent in finding adequate post-school care, or whatever. But really, the situations that face us are much more black and white in terms of determining whether there's adequate supervision or not.

J. Tyabji: In the instance that the minister is talking about, where, using the minister's words, there's a less noble motive for the child being left unattended, and in the event that alcohol and drug assistance may be given if the parent is a substance abuser, I would assume that some of the assistance offered would also be a homemaker or someone to help care for the child while the parent is in care. Maybe the minister could clarify that. And if that is the case, would the parent have any say as to who the person -- from the point of view of that person being in the home -- taking care of their child would be while they're undergoing rehabilitation?

Hon. J. MacPhail: This section is about dealing with a child who is left unattended and what we can do to ensure that the child gets to stay as close as possible to her family environment without having to invoke full court proceedings. We're dealing with the child under this section. However, our ministry, and indeed the act, has all sorts of family support services that we can make available to the parents, which may include life skills training, homemaker support, alcohol and drug counselling, referrals, etc. In fact, that is what occurs.

J. Tyabji: I'll take one last shot at this section before moving on. What I'm trying to get at, as the minister can understand, is that any family in the kind of difficulty where there may be a need for some assistance because of substance abuse will probably already have stressed relationships, whether it's a single-parent family or not. If a third party is introduced to the family without the consent of the parent, even if the director is the person who believes that this person is suited for that environment, that may cause further trauma for the parent-child relationship. Would the parent's wishes be taken into account -- a parent who may be in serious need of rehabilitation or counselling? Notwithstanding that, they are still the parent of the child. If we're looking at the child's best interests, obviously the child should understand what is happening. If the parent feels comfortable and has some say, some input, that is obviously going to make it a less stressful situation while the parent is in the process of rehabilitation. That's the only thing I'm trying to get at. To what extent does the parent have a say in choosing the person who will be assisting them through a transition period?

Hon. J. MacPhail: The parent isn't there; that's why this situation is invoked.

Hon. member, I understand your frustration, but this section applies if the parent isn't there. This section deals with the first 72 hours when the parent isn't there. If and when the parent returns, we will invoke every possible support mechanism to ensure the best interests of the child.

Section 25 approved.

On section 26.

J. Tyabji: With regard to a "lost or runaway child," I would imagine that this includes street children as well.

Hon. J. MacPhail: Yes.

J. Tyabji: Subsection (5) says: "If the person responsible for the child is not located by the end of the 72 hour period, the director no longer has charge of the child." Then who does?

Hon. J. MacPhail: Yes, that's right. The child is not in our care for the first 72 hours. We are in charge, but he is not in our care. We then have to proceed through the other sections of the act, which may include the courts.

J. Tyabji: So the intent of this section deals with the interim period of 72 hours. At the point where that expires, the director may apply for a temporary custody order, and we go through the rest of the act. The only reason I'm asking is that I want some assurance that there would be that follow-up through the bill.

Hon. J. MacPhail: Yes.

[ Page 12041 ]

V. Anderson: It comes up in a number of areas, but perhaps I'll ask it here. One of the questions that has been raised is in regard to an unattended child or children who are taken into care, if you like. Once children are taken into care, I presume the legal responsibility that normally applies to the parent is now in the hands of the ministry. When they are in the ministry's charge, is legal responsibility also with the ministry, or is it still in the hands of the parent in that period? What's the difference between the two?

Hon. J. MacPhail: In that 72-hour period, guardianship is still with the parents, and our legal responsibilities and obligations flow from the act. That's where we are to maintain the health and safety of the child while we find the parents.

Sections 26 to 28 inclusive approved.

On section 29.

The Chair: The member for Okanagan East. We were on a roll there.

J. Tyabji: Yes. Hopefully we can get through some of the other sections of the bill as quickly.

With regard to section 29, what is the definition of essential health care, and to what extent will this be in conflict with the religious background of the individual or the family? If the family subscribes to naturopathic methods, will they be able to object to what we call conventional medicine?

Hon. J. MacPhail: The determination of what is essential is listed under subsection (3) as health care that "is essential to preserve the child's life or to prevent serious or permanent impairment of the child's health." That has to be confirmed by the opinion of two medical practitioners. In the event that a family may have religious or philosophical beliefs that suggest they don't want the child to have any essential health care, that's when the court comes in. We can go before the courts. It won't be in our hands to determine the validity of that belief; the court will determine that.

J. Tyabji: Who chooses the two medical practitioners for the opinion on essential health care?

Hon. J. MacPhail: Actually, the way this has unfolded now is that the doctors themselves come forward. It's an issue of the child being in the care of a doctor.

J. Tyabji: I read into the record in the debate last week something provided by the Citizens' Research Institute with regard to some of the examples where a family has chosen not to use an experimental drug, so I won't go over that again.

One thing that comes to my attention -- certainly in my riding and, I'm sure, around the province -- is that we're at an age where there's a bit of a transition in terms of medical treatment. There are a lot more people opting to go to chiropractors rather than take painkillers, and there is some major.... In my opinion, there is a bit of a lobby by the medical profession to prevent that. Obviously they have a vested interest in perpetuating conventional medicine. Two medical practitioners may come forward with a complaint that a certain drug or method of treatment that has been prescribed by that practitioner, perhaps in conjunction with another practitioner, is not being used by a family. For that to be the basis for a complaint as constituting negligence of essential health care is a problem. What would be the avenue of appeal for a family if, let's say, they didn't want to go the route of drugs and were trying to pursue alternate medical treatment? Could they then provide two other medical opinions to combat the first two, so that there wouldn't be this determination under this section?

Hon. J. MacPhail: Yes. In fact, the avenue available for appeal is the courts. There is the opportunity to present that kind of evidence to the court.

J. Tyabji: Who would pay the litigation costs of the family if they were trying to defend their position on health care?

Hon. J. MacPhail: The family.

J. Tyabji: I very much object to this, because I don't see it as in the best interests of the family. I'm sure the minister can see, upon reflection, that if we want the opinion of two medical practitioners, and if two came forward to Social Services saying that there was a need for essential health care, then the two that would provide an opinion should be one chosen by the Ministry of Social Services and one chosen by the family. That would be cheaper because it doesn't require litigation. Litigation increases the cost to Social Services and to the family, not to mention the trauma and stress involved. The way the bill is written now and the way it was practised before, the child can be apprehended during the litigation proceedings, because it's up to the family to prove that the child doesn't need the care. The child could end up being on a drug that the family doesn't approve of. Maybe it's not even for religious or philosophical reasons; they just don't think it's what the child needs.

Let me draw the minister's attention. If we watch television anytime, we will see advertisements for new drugs, with the list of doctors to prescribe them whom you can go to. We can see examples where doctors will advance a drug, because they may sincerely believe it's in everyone's best interest to be on Prozac or something. Then you'll find a fleet of other doctors who don't think it's a good idea.

To avoid the cost of litigation, I hope that in practice, the two medical practitioners used would be one chosen by the family and one by Social Services, and then in that sense, if we have to, we would go to mediation before we go to court.

V. Anderson: I think the minister can provide some assurance to people on that particular issue. It is one -- raised by a great many people -- of being able to make sure that their own family medical practitioner can be involved in the decision.

In the past there has been the feeling -- rightly or wrongly, but the feeling is necessarily there -- that two doctors chosen by the ministry are favourable to the ministry in the decisions they make, and the family practitioner then doesn't have the opportunity to be involved. If there can be some assurance that the family practitioner always has the opportunity to be one of the doctors in the consideration, then this would alleviate many of the concerns.

[3:45]

If it's an emergent situation and that doctor isn't available, then that's something else. But in all normal circumstances, the family doctor who has the history and the ongoing care of the patient should be one who's there to present the medical needs of that child. Can there be some assurance in that direction?

[ Page 12042 ]

Hon. J. MacPhail: The two doctors are merely to raise the issue of whether, in those two doctors' opinions, the child's health is at risk as outlined in subsection (3). After that, the decision goes into the courts, where the family has a full right of representation. If the family has a family doctor they wish to have present -- in some circumstances the family may not wish to have their family doctor present -- that's entirely up to the family if they so choose. They can bring whomever they wish to court.

V. Anderson: Following up on that, the way the minister responded, it sounded like the family doctor was being excluded by design in that first medical opinion to the court. If the family doctor can be part of that first medical opinion, then right at the very beginning you have more confidence in it.

But if it's two doctors who are apart from the family doctor by design, then you've already set up a conflict between the family doctor and two other doctors. If the family doctor -- if people wish it -- can be part of those two right at the very beginning, it would simplify the process and do away with the antagonism, which the minister is trying to overcome in the rest of the bill. It's a process of including those people who are trusted by the family at the beginning, not one of having them confront the opinion of two other doctors later on.

R. Neufeld: We've had representation made to us by people who are looking over the legislation that they would like the family physician named at least as one of those people, simply because the family physician knows the history. For reasons that the last member just spoke about, many people feel there's a plot -- even though there isn't -- to have two other practitioners subjected to looking into the medical reasons.

I can't imagine why that would be so hard for the minister to understand. When we're talking about the child and the family and we're trying to stay away from conflict, why would it be so hard for the minister to understand how the opposition and the public feel about this? Maybe not the people you're talking to, but the people who talk to us have some concerns about it. It would be a friendly amendment, which would very simple for the minister to accept. I can't for the life of me understand why the minister would not want to do that.

Hon. J. MacPhail: I'm not aware of an amendment being before me. Certainly I understand that the hon. member may be trying to provoke me into saying that I don't understand. I fully understand. Let me tell you what the realities of this clause are, though. I'm giving you an exact example here. A child could be badly burned and unconscious, and the family is saying: "No blood transfusion." It is not us searching out two doctors; it is two doctors who have come to us. At that point, where there is clearly a situation of the opinions of two doctors versus the family's opinion, there's no sense in us trying to decide those issues. That's the provision of this act. The act does give the family the right to then bring in his or her family doctor. There are also many situations....

Interjection.

Hon. J. MacPhail: No. The two medical practitioners are merely to determine.... It's not us who will determine, without medical advice, whether there is even a suspicion of the child being at risk. That's why the two medical practitioners are involved in the first place. It isn't a matter of us going to search them out. In reality, the doctors come to us and say that the two of them think this child's life is at risk or the child may be subject to serious or permanent harm.

In many circumstances, it is the family physician who is involved. But there are also other circumstances. The child may not be in their hometown, or the family may not wish any medical intervention whatsoever, so they're not willing to bring the family physician in, regardless. We don't want to hold it up at that point. We're just saying that that's the kick-start to the proceedings. We may go to court to determine if the child is at risk, from a health point of view, at which time both sides have a right to bring forward whomever they wish. In fact, when those issues have been decided in court, there have been occasions when the parents' wishes have been upheld.

R. Neufeld: Far be it from me to tell the minister that she doesn't understand. I certainly wasn't trying to imply that the minister doesn't understand. Maybe I'm trying to say that you're not responding to what we're hearing from the groups we're talking to on this particular issue.

I have an amendment to section 29(1): after the words "of 2 medical practitioners," add "if possible, one of whom is the family physician." It's a fairly friendly amendment. The minister brought forward quite correctly that the child may be in a different town than their family physician. So if you put in "if possible" -- and we do that throughout the whole bill when we talk about the director, whether they may or may not -- that would be the driving factor: if possible, use the family physician as one of the physicians.

On the amendment.

Hon. J. MacPhail: I wish to outline for hon. members what the current practice is, according to the act. It is such that the child is apprehended, and the viewpoint of those other than the family is imposed. This amendment is changing it to meet the needs of the constituents I assume you're representing, which is to say: "Hey, give us a chance here. Let our opinion be heard. Don't impose religious or medical points of view on us that conflict with our religious or philosophical points of view" -- because that's what happens now. This act is changing it to say that that determination will no longer be made by the ministry; if there's a dispute, it will be made before the courts.

There are also some very real circumstances that face our ministry every day, and for which I receive information every day, where a child is greatly at risk. I'm not sure that the member intended to impose a greater risk on that child by having us search out and wait for the family physician. The practice now is that when the family physician is available, the doctors themselves do that. I have the highest regard for the networking among doctors. In fact, the reality of the day is that very often the family physician is called into play. Mind you, it's not at the family's request that the family physician is called in, because the family is in dispute about any medical attention being offered.

You articulate the needs of your constituents by saying they should have a say in the future of their child. That's exactly what the act does. I understand your concerns. I hope you see that the act does provide for allowing them a say. The amendment about the family physician will not meet your constituents' concerns.

J. Tyabji: I wonder how the minister would feel if her child's doctor recommended an experimental drug. Perhaps the child exhibited some behaviourial changes at school that 

[ Page 12043 ]

may be normal for an adolescent and Prozac was prescribed, or prednisone was prescribed for a health disorder; or, for the first time we have a genetically engineered vaccination for the meningitis virus, which has not been adequately tested, that is being administered to some students. Parents are assuming that these are safe.

If a family, through self-determination, wants to object to a medicine.... I didn't move the amendment for the family physician, because....

Hon. J. MacPhail: You wrote it, though.

J. Tyabji: Well, he asked me to do that, and as a constructive opposition member I'm prepared to do that.

The minister should be aware that in my opinion, what needs to happen before you go to court and before the public and the family pay for court proceedings -- and let's remember that under section 30, they don't have to go to court; they can apprehend the child and administer the health care, if that's what the director chooses to do -- is that at some point, the family should be able to choose a medical practitioner for the purposes of the director, not a court, so that you don't have to go to court. When you talk about the mediation proceedings and things like that, that should take precedence over court action.

I don't know how the minister would feel. Two doctors could come out constantly and be prescribing pharmaceutical products for almost any child. It's common. Heavy antibiotic treatments are being prescribed, and cortisone creams and all kinds of things that are controversial can be prescribed for children.

Basically, the point is that if a family is to feel secure in their self-determination -- whether it's a one-parent family, a two-parent family or a grandparent -- they should have some comfort that if someone from outside the family is trying to prescribe a drug, the family has the option to determine who provides the second opinion. Rather than having the person who provided the first opinion finding a buddy to provide a second opinion to back him or her up, the family can say: "We've got this other opinion. Therefore let's not go to court; let's go to mediation." Then we don't have a big court expense, a judge involved or all the other necessary expenses. It seems to me to be a pretty basic point, and I think the bottom line is who chooses, how much it costs and what pain and suffering we are going to inflict on these families, who may be proven in the long run to be right, because it could be an experimental drug in the first place.

[D. Lovick in the chair.]

Hon. J. MacPhail: Rather than dealing with the hypo-thesis of drugs in this day and age -- of which I have no expertise and no experience whatsoever -- let me say this. The hon. member posed a question to me. If I were faced with the situation she outlined, rather than have the current practice invoked upon my family of having my child apprehended, I would want to have some neutral avenue where I could explore the options for the future of my child.

In terms of the realities of the situations we face, and of the realities that families face under this particular section, we are dealing with situations where a child's life is at risk, and we have to prevent a serious or permanent impairment of a child's health. We're not making things up here. We face these situations. Children are brought in from accidents or fires, and there is no time to delay in terms of choosing a range of sources merely to get the situation before a neutral court; that's all we're talking about here. I feel badly that I cannot make the members aware of the improvement this situation offers to the family's right to self-determination. The current situation allows the family no self-determination.

[4:00]

If the hon. member is saying that in some way the big, bad ministry would ensure that the family is excluded from allowing any input into this, that is simply not the case. If the family is available and requests a particular medical practitioner who is available and will not contribute to the child's imminent risk, then we'll do it. But in the absence of that, there would be two doctors, and then the parents would have their say. If there is still conflict -- and sometimes there isn't -- then the courts will decide.

R. Neufeld: We're starting to belabour this a bit. The minister implied earlier on that I would pose an amendment to this bill that would allow serious or permanent impairment to a child. I think she knows better than that, coming from me. I certainly would not want to put something in legislation that would cause harm to any child, and I don't think it was fair of the minister to say that I would do that. All the amendment says is that if it is possible, the family physician be used as one of the two doctors.

As I told the minister earlier, through the whole bill we talk about.... In fact, I have one in front of me. Section 31(2) says: "The notice may be given orally or in writing...." So we go broad in all kinds of areas. All we're asking for is that the family physician be one of the medical practitioners, if possible. That does not mean that I want to put any child in danger, or that that member wants to put any child in danger. I think we're all trying to do the same thing: to look after the children as best we can.

I'm not saying that the way it was before was better or that this way is better. I agree that some parts of this legislation do enhance what we have in Social Services. I have no problem with that, and I agree with them.

V. Anderson: I have a feeling that we need some mediation in here -- that we're misunderstanding each other.

One of the realities is that the legislation not only needs to be seen to be effective by the people who are presenting it, but it needs to be seen to be effective and fair by the people who are reading it -- who come cold to it -- and haven't the philosophical background or discussion that many of us have been involved in. If we talk about it from the point of view of plain language, when other people read it, they must be able to get the intent. Somewhere in here -- and this would be as good a place as any -- we need to signal to the populace that when it comes to health care, the family physician has an important and significant first place. If something happens to me, I would want my physician involved as well as the specialist, because they work together as a team.

All we're asking for -- and I would support the amendment heartily -- is the signal. This paragraph is not dealing with something that has to be decided within the next two hours. Subsection (2) refers to two days before the hearing takes place, so this section is not a time factor in the sense of an emergency which has to be decided between 12 midnight and 2 o'clock in the morning. That emergency decision which has to be done right then and there because there's no time to wait is covered in other places; that's another matter. This one deals with a longer-term situation. There are at least two days before the decision is going to be made, so there is normally time to contact the personal physician and get their input and the history about this person. If you have two days, and if decisions are being 

[ Page 12044 ]

made without this particular patient's history -- apart from the family's concerns, the medical history.... I know in our own particular case, without the x-rays of our daughter those decisions could not have been made, because we needed a historical period of time in order to make the decision at that moment.

So all we're saying is that in this particular case, because of its seriousness, if possible, the patient's own physician -- and their history -- should automatically be called into play as one of the two people. If that signal is there, it will do away.... It doesn't distract from but adds to the section, by giving the signal that the medical history of that child, from the physician who knows him, is important.

Hon. J. MacPhail: I really do very much appreciate the hon. member's understanding of the philosophy of the act. But we also must be careful not to impose our own particular circumstances on the populace at large through legislation. Let me just give you examples. It is important because in some cases families have two or three family physicians. In some cases a youth has her own physician, separate and apart from the family. And in some cases the family may not want the family physician involved; that's all. I appreciate the way you understand the import of this, but it isn't up to us to.... We should legislate as little intrusion into the family's decision-making as possible.

But I will tell you that when the crunch is on and you truly are in a dilemma, the practice has been -- and I have talked to some of my staff colleagues who are actually in the business of practising this -- to involve as many people as you possibly can in order to reach the best decision possible.

H. De Jong: The minister, in her earlier comment, said that in the absence of the family doctor, she would probably then look for two medical practitioners. All that the amendment really says is that when the family medical practitioner is available, he be one of those. So I simply cannot see.... And the minister can say that we on this side of the House want to impose our own feelings. I suppose that we can have the same argument from this side: the minister wants to impose her own ideas onto this bill. I believe that it is a fair and reasonable amendment to at least give the family the choice of whether they wish to have the family practitioner involved in these situations, which are not easy situations for a family. So I simply cannot understand why the minister would be opposed to this amendment.

Hon. J. MacPhail: I agree with you, hon. member for Vancouver-Langara, that we seem to be getting a little carried away with this and need mediation.

Let me pose to the hon. member who just spoke: what if the family physician were the one that the hon. member for Okanagan East said ordered the drugs? What would we do in that situation?

J. Tyabji: I think that's exactly why we need to have the family determine one of the two opinions. That was basically what started this debate in the first place.

Hon. J. MacPhail: That's not what the amendment says.

J. Tyabji: It's not my amendment. I wrote....

Hon. J. MacPhail: You wrote it.

J. Tyabji: The minister is saying I wrote the amendment. I did so at the request of the member who was on his feet; I put together the amendment he asked me to write for him. In fact, when I'm speaking to the amendment.... I'm sure the minister knows that when I started this debate, the whole point was that if you want two medical opinions, one should be a medical opinion gathered by the family for input into determining whether services are needed.

I want to quickly give an example before we go to a vote on this, because the minister says she has ultimate faith in doctors and, when she was talking about medicine being prescribed and the doctors' opinions, that she doesn't know a lot about....

Hon. J. MacPhail: I said I'm not an expert.

J. Tyabji: She said she's not an expert. I'd have to review the Hansard. She said something as well about having faith in the opinion, but....

The Chair: On the amendment, members.

J. Tyabji: On the amendment, there are two examples that I'd like to provide the minister where her ministry incurred significant court costs because, on two separate instances, they did not allow the family doctor to offer an opinion. The first was with regard to an eight-month-old baby apprehended by Social Services after the mother, on the recommendation of her doctor, had taken the baby to Children's Hospital for examination. Prior to that, two doctors gave two medical opinions that said the child was suffering from a virus and dismissed it. The mother didn't believe that and went to the family doctor, and the family doctor recommended further inspection. At the Children's Hospital, the baby was diagnosed with two broken legs. After two medical opinions of a virus had been given, the child was diagnosed at the recommendation of the family doctor as having two broken legs. Social Services didn't try to determine where the child had received the broken legs. They immediately apprehended the baby on the basis of the medical opinions and spent over $20,000 in court just on the basis of Social Services.... It was later determined that the baby's legs were broken at the day care. The parents had exercised due diligence. The mother had been trying to protect the child and had gone in the best interests of the child.... Social Services apprehended the baby on the basis of medical opinions without even consulting the family doctor or the parent in terms of where the child had received the injuries.

The other example, which I'm not going to go into any detail about, is the one where I talked earlier in the debate about a young girl. She sustained an injury and had a flu. The Children's Hospital, not the family doctor, intervened. A doctor who did not know the family prescribed an experimental drug which the family did not wish to administer and, in that case as well, they ended up spending a long period of time and thousands of dollars in court trying to prove that the child did not need the medication. Meanwhile, the child's health did deteriorate because she developed side effects from the drug that they were administering to her.

[4:15]

In this respect, I am speaking to this amendment, because it would certainly make it better. I should put on the record that this is an improvement on the status quo; there's no question. Many of the things that we're objecting to in this bill are improvements on the status quo, because the status quo is section 30 without accountability. This is an improvement, but if we're going to improve it, for goodness' sake, let the family decide one of the two medical opinions. For the 

[ Page 12045 ]

purposes of this amendment, that should be the family doctor, which would obviously be an improvement on two people who don't know the family record or the children or the parents involved in the discussion. It's an easy amendment. I would imagine that if the minister doesn't have an objection to it, it should just be passed.

Amendment negatived on the following division:

The Chair: I will give members who have other duties an opportunity to attend to them.

Before I recognize the member for Vancouver-Langara, I'd just like to offer an observation to members of the committee. This is a complex, lengthy bill, and we have a huge number of amendments on the order paper and a number of others that will probably be sui generis -- that will come along as we proceed. I want to suggest to members that if we have extensive, long and detailed debate verging on principle on every amendment, we will not complete this measure for a very long time. I want to suggest that what we ought to do with amendments is hear the amendment moved, hear from any other member who wishes to speak in support of the amendment and then hear a response from the minister as to whether she, in this case, accepts the amendment; and then, in most cases at least, we should put the question. It seems to me that going beyond that and having debate back and forth on amendments is not going to be helpful, quite frankly. I hope members won't mind if I suggest that that become the procedure from this point forward.

Having said that, I recognize the member for Vancouver-Langara.

V. Anderson: I think that we on this side are all nodding in agreement with what you have said. That doesn't mean we will all agree on the point, but we will try.

Not to belabour it, this is an important point. I would move the amendment to section 29(1) that the minister has in front of her: "after 'in the opinion of 2 medical practitioners,' add 'one of whom, if possible, is a medical practitioner of the person's choice'." Let me use the illustration of a young person who may have their own medical practitioner who is different from their family's practitioner. To respond to that, I still think that's important, where possible. I recognize that if the medical practitioner the person chooses contradicts the other medical practitioner, they'll have to go further in order to deal with it. But I think if they had that up front, it would make it a lot easier in the majority of cases. I would so move.

On the amendment.

R. Neufeld: In following your direction earlier, I will speak in favour of the amendment. I'll be very short. There was some problem with "a family physician." If we're going to talk about a physician of their choice, I think that alleviates the problem. I think it's a good amendment. The wording may be a little more acceptable to the minister. I hope the minister will accept this friendly amendment.

J. Tyabji: I'm in favour of the amendment.

Hon. J. MacPhail: I have nothing to add to the debate that hasn't already been said.

[4:30]

Amendment negatived on the following division:

Section 29 approved on division.

On section 30.

Interjections.

The Chair: Excuse me, members. Could we have some order so I can hear the member's questions?

V. Anderson: I move the amendment standing in my name on the order paper. Section 30 has to do with the removal of a child. I recognize that this section is included to deal with exceptional and urgent circumstances. Sometimes action has to be taken quickly and with due diligence. I have two amendments which I think are important for those involved, and they are on the order paper.

[SECTION 30 (1) and (2), to be amended to read: 
(1) A director may, without a court order remove a child in the company of a police officer if the director has reasonable grounds to believe that the child needs protection and that 
    (a) the child's health or safety is in immediate danger, or 
    (b) no other less disruptive measure that is available is adequate to protect the child. 
(2) A director may without a court order and by force if necessary but in the company of a police officer, enter any premises or vehicle or board any vessel for the purpose of removing a child under subsection (1) if 

[ Page 12046 ]

    (a) the director has reasonable grounds to believe that the child is in the premises or vehicle or on the vessel, and 
    (b) a person denies the director access to the child or no one is available to allow access to the child.]

Those are the words to be amended. When this is done, we think it's important to the family as well as to the children that this be available.

On the amendment.

R. Neufeld: Not to belabour it, I agree with the two amendments that the member for Vancouver-Langara puts forward.

Hon. J. MacPhail: In the interest of brevity, I'll save my philosophical comments on the amendment. Let me just say that police are brought if it's necessary. But under many circumstances it's not necessary. It may not be appropriate in terms of time and the best use of public resources. It just may not be necessary at all. In some cases, for planned apprehensions -- and there are cases of planned apprehensions -- the amendment would make it far too heavy-handed, to be frank.

With the greatest of respect, because I know that the hon. member supports the intention of this bill, I say that this bill is not to criminalize the process. Quite frankly, this amendment is inconsistent with the underlying principles of the act.

Amendment negatived.

H. De Jong: I have a question about "reasonable grounds." I know it was in the old act too. We had a situation where a family had foster children for the last 25 years. They tried to adopt the two children. When some investigation then took place, all of a sudden these children were taken out of that home -- without any warning to the parents, without any discussion and without any way the parents could speak to them about why the children were taken out. This is where I have difficulty understanding what reasonable grounds means. In my opinion, there were no reasonable grounds in that situation.

Hon. J. MacPhail: In fact, that's why we're changing the law. The situation you described, if it's a British Columbia situation, must be under the current law. The law is changed now.

We're dealing with the situation where reasonable grounds have to be determined. Reasonable grounds is a legal concept and well-tested in the courts. That has to be determined, in conjunction with the fact that the child's health or safety is in immediate danger and also that less disruptive measures have been tried first.

H. De Jong: I just want to continue for a bit. I don't want to belabour this very long, because the matter probably is going before the courts. I'm not sure; I don't think it is at the present time. But I do know that this section and the way it's been applied in that family now puts the family into a position of spending all of their life savings to get those children back -- if they ever do get them back.

This is where I find more consideration has to be given before that final step is taken. I simply cannot see where a director may, without a court order....

If those reasonable grounds were in fact applied in that case, then an awful lot of families are going to find themselves in a situation where for 25 years -- and some perhaps longer -- they have looked after children very well, given good service to the community, been a well-respected family in the community and are put in that position to gain these children back. I don't think that is appropriate. In my opinion it's absolutely unfair.

I realize there may be other situations too, and that's why I'm bringing this up. In that particular situation, I feel the parents were badly treated.

Hon. J. MacPhail: I believe I heard the hon. member describe foster parents and adoption. While I'm not sure of the details of his case -- although I suspect I do know which one he's talking about -- foster parenting is a contractual arrangement that comes to a conclusion under the circumstances he talks about. When the contractual arrangement is ended, the children need to have some other care. It's not this section of the act that applies. While the point may be well taken in advocating on behalf of his constituents, it's not under this act that the breach has occurred.

Section 30 approved.

On section 31.

R. Neufeld: Section 31 says: "(1) A director who removes a child must promptly make all reasonable efforts to notify each parent of the child's removal. (2) The notice may be given orally or in writing" -- that's part of what bothers me -- "and must include a statement of the reasons for removing the child." I understand that when a child is being removed there is probably a relative amount of confusion, and oral notice is probably acceptable at that time. However, in a follow-up there should be written notice. It's the only way to ensure that the parents know the reasons the ministry is doing what they are doing. In the case of a court action later on, it may be something that could just as well protect the caseworker -- the director in this case -- or the parent or the child.

I move the following amendment standing in my name on the order paper.

[SECTION 31, by adding the following subsection: (3) If notice is given orally under subsection (2), the director must deliver a written copy of that notice no later than 7 days after the oral notice was given.]

I hope that the minister will find that friendly amendment helpful with this section of the bill.

On the amendment.

V. Anderson: I have to speak against the amendment and in favour of the amendment that I will be bringing forth. It's important that at the time the child is taken -- particularly if the parent is available -- notice be given in writing. If your car is picked up and impounded, you are give an indication of where the car is and how you can get it back. If children are taken, there should be a receipt, if you want to put it that way -- some statement of who has taken the child and who a person can contact about the child -- and that should be given immediately to the parent. If they are taken from a house and the parents aren't there, that statement should be left in the house so they know where the child has gone, who has taken the child, and they don't have to go to the police and say: "Who stole my child?" It's traumatic enough to have the child taken, but to have nothing left and to give an oral statement to a babysitter or to someone else is unacceptable. There needs to be a simple written statement available as to who has taken the child, where contact may be made and 

[ Page 12047 ]

what authority to contact. I am against this amendment and would be prepared to make my own.

J. Tyabji: Unless something different is going to happen with this amendment, it's going to meet the fate of all the other amendments. So I would like to speak in favour of the intent of the amendment and won't move the one that I was going to move. I think all of us are concerned that the parents have something in writing at the earliest possible time -- that it not be an "or" clause; that it be an "and" clause, recognizing that you might need something in the short term orally, but that there should be something in writing almost immediately afterwards.

Amendment negatived on division.

V. Anderson: I move the amendment standing in my name on the order paper.

[SECTION 31(2), to be amended to read: (2) The notice must be given in writing and must include a statement of the reasons for removal of the child and how further contact may be achieved.]

We all know how ineffective oral communication is. We can be misunderstood. I think it needs to be in writing, particularly with multiple cultures and languages and other concerns. Nothing is more precious than your child, and therefore it should be clear.

On the amendment.

Hon. J. MacPhail: Parents don't get notice now. I know that in the briefings the hon. member had, there was certainly an understanding of what a great improvement this is.

The intent of oral notice is that if there is a situation of immediate concern, the parents are orally notified immediately. The practice of the ministry, even without the legislative requirement, has always been to leave a notice in writing. There is now an inclusion that a statement of the reasons has to be given. Within seven days the whole matter will be before the courts, with the parent having full notice and full representation.

V. Anderson: If your child has been taken away, seven days is an eternity, particularly for many people in our multicultural communities who have come from situations where when children were taken by police, they were never seen again. That's the reality that many of our people have faced. Something needs to be in writing: who has taken the child and why, and where can you contact that child. There needs to be a phone number for someone you can contact. If it's 12 o'clock at night, you need to be able to phone that night and say: "Where is my child? Who has my child?"

[4:45]

Hon. J. MacPhail: Yes, but listen: the point is well taken, except that the reality of the day is that often the parent isn't there; the child has been abandoned. In some circumstances the child isn't being apprehended from the parent. So we are saying that in those circumstances where the quickest notice to the parent is oral, we should have that option. The practice of the ministry has always been and will continue to be as the hon. member outlines.

V. Anderson: All it takes is a few moments for the person who is taking the child to write down on a prepared form that this child has been taken by the Ministry of Social Services, this is where the child is, and this is the phone number where you can contact the ministry about this child. It's as simple as that; it doesn't need to be any more complicated than that. Otherwise, it's secretive and frightening beyond imagination.

The Chair: I would just remind members of our agreement. The member for Okanagan East.

J. Tyabji: As with a similar amendment, the previous one, oral notification is at the earliest opportunity and then there's something in writing. I think it's important to remember, for the purpose of the debate, that the definition of parent in this act doesn't just include the biological parent. The minister said that in some cases the parent might not be the person who has charge of the child. It could be the person with whom there's an agreement, it could be a guardian or it could be whoever is caring for the child. For the purposes of this bill, they become the parent. In that case, notwithstanding where the biological parents might be, there must be someone who would have care of the child. We know a number of cases where children have been apprehended without proper notification. It does seem like it would be very simple to pass this amendment and move on.

Hon. J. MacPhail: In answer to the hon. member's seeming indignity around the issue of oral notice, some children are apprehended from the streets; the parent is not to be found. If we were required to give written notice, the apprehension would grind to a halt, and the child would be left at risk.

I seek leave to make an introduction, if I may.

Leave granted.

Hon. J. MacPhail: I am pleased that families are back with us to share in the debate of this legislation. With us today in the Legislature are Carol Richardson, Sarah Berland and Anne Berland, who are the family of Jeremy Berland, the director of family and children's services. I ask the House to make them welcome.

V. Anderson: I don't want to withdraw it. If the parent isn't there and you can't give a report, fine; but if you're able to give an oral report and the parent is there to get that oral report, then it's just as easy to give them a written report.

Hon. J. MacPhail: Hon. member, really. What if they're in Vancouver and the parent is in Fort St. John? You can make a telephone call in 30 seconds, but you can't deliver a letter in 30 seconds.

R. Neufeld: There seems to be some difficulty in getting the minister to accept an amendment of any kind to her bill. I agree with the member, but when you look at it, it would be a little difficult to hand a written notice to the parent if the child was on the street. But there must be some happy medium here, because just to say that it must be done orally or in writing.... How many times has somebody said to you that they called you and told you something, and you say: "I can't remember that"? That's how easy it is to misuse an oral presentation -- unless it's also written out. That's why we in this House use Hansard. We never used to. I guess that years ago they didn't use Hansard and anything went, but now we use Hansard to record this so there's something there -- and so we can always come back on the member for Nanaimo about what he said many years ago. Anyhow, that puts a little humour into it.

[ Page 12048 ]

Really, Madam Minister, I would like you to speak with your staff a bit. Maybe we can stand this section down for a while and talk about it, rather than trying to get amendments back and forth through the House here. Seven days is too long, and five minutes is too short; maybe there's a happy medium there someplace. It's protection for the caseworker and for that director also, and it can be used later on. I would think that with some of the problems we have experienced recently that the minister's well aware of, probably something like this would help. I'm talking about Fort St. John. If we wrote down things that happened, why they happened and why they didn't happen, it would be a lot easier to deal with it later on. I can't for the life of me see why the minister wouldn't want to accept some friendly amendment that the member for Vancouver-Langara and the rest of the opposition would be happy with.

Hon. J. MacPhail: I'm certainly open to that, hon. Chair, if we wish to stand this section down, or whatever the terminology is. However, I hope the hon. members also understand the circumstances that we face daily and have to cope with. But if there's some provision such as "as soon as is practical," or whatever, we can work on that language together.

The Chair: We'll stand down section 31, if that's agreeable to the minister and the members opposite. All right. And the assumption is that there will be some meeting outside this chamber. Fine.

Section 32 approved.

On section 33.

V. Anderson: I move the amendment to subsection 33(2) standing in my name on the order paper.

[SECTION 33 (2), to be amended to read: (2) When a child is returned, the director must inform the parent in writing whether the director intends to withdraw from a proceeding under this Part or to take further steps under this Part.]

Again, there needs to be a clarification of what the director is doing, and it needs to be clear to all parties. If it is in writing, then there's no misunderstanding. It's a very simple thing for the director to do that when the child is returned, so that it's clear that the director and the parent -- and the child, as the case may be -- have in their mind what is happening, and they can count on it for the future. It's that written document which is so important to make everything clear and concise.

Hon. J. MacPhail: We can accept that.

Amendment approved.

On section 33 as amended.

V. Anderson: Section 33(3) is where the seven days comes in, and I say that seven days is too long. So I move this amendment.

[SECTION 33 (3), to be amended to read: (3) If the director does not intend to take further steps under this Part, the director must, within 24 hours after the child's removal, (a) present to the court or a justice of the peace a written report on the director's reasons for removing and returning the child, and (b) provide a copy of the report to the child's parents and any person notified or the presentation hearing.]

The amendment says: "If the director does not intend to take further steps under this Part, the director must, within 24 hours after the child's removal...." -- rather than "within 7 days." When you're dealing with a family -- a child and siblings and all the others involved -- seven days is an eternity. I move that it be 24 hours, because I think the minister herself has indicated that we need to move things along in a very quick fashion, and that we're trying to get away from the normal court proceeding, which just extends things on and on. If I understand rightly, it's important, if the director is not going to take steps, to make that known as soon as possible.

On the amendment.

Hon. J. MacPhail: The intent of this section is to notify that there will be no continuation of the court proceedings. However, there has to be some determination, contact and plan established within that period of time. Twenty-four hours is too short. This is merely filing a notice, saying that the court action is off. But we have to have time to prepare for circumstances otherwise, for putting a plan of action in place. So it's not as if the care and well-being of the child don't continue during that period of time. It's just saying that we can't do it without due deliberation, which requires seven days. It's merely a notice that's being filed with the court; nothing turns on it in terms of the planning for the child.

Amendment negatived.

J. Tyabji: With respect to returning a child, I see there are four subsection provisions under which a director may return a child. What happens in the event that the director has made a mistake? I think that is covered by section 33(1)(c), where there might be a receipt of "information that causes the director to believe the child does not need protection" -- although it could be that after the apprehension of the child, the director has determined that the child didn't need to be apprehended. I assume that's been covered. But if there has been an apprehension and it's later determined that that didn't need to happen, what is the accountability process?

Hon. J. MacPhail: That accountability is under section 33(3). It was what I was talking about in the debate just before this. That report has to be filed, and the court has to be aware of the director stepping away from the case.

J. Tyabji: One would assume that when reports are filed with the court, there would automatically be.... Well, I would hope that in every case of apprehension, the minister's office would be directly informed, in the same manner as the court would be informed. Is that true?

Hon. J. MacPhail: Excuse me. You said "minister"?

J. Tyabji: Minister's office.

Hon. J. MacPhail: No. This isn't a political process.

The Chair: Is there some confusion, member for Okanagan East?

J. Tyabji: What I'm asking has nothing to do with politics. In the event that someone who works for the Ministry of Social Services -- under the direction of this minister -- 

[ Page 12049 ]

apprehends a child from a family, is there a process by which the minister's office is informed of that, just as the courts are informed whether or not there will be proceedings under this act?

Hon. J. MacPhail: I hope I can answer the intent of the question. The minister isn't a social worker, in normal cases. The act is not administered by the minister; it's administered by the director. Thus the director holds the responsibility for it. I'm not sure why the hon. member would want the involvement of a politician in this. I just don't know.

J. Tyabji: I don't want the involvement of a politician. The point is that the minister is the one who has debated, outlined and brought in the bill and is the person directing the entire Ministry of Social Services. We have had extensive debate in this House; we've brought up some case studies, and the minister has known or not known about them.

I would assume that this minister would want information from the director after the director gets the report on apprehension. We know that it may not be the director herself who is directing the apprehension; it could be someone delegated with the authority to apprehend. I was just assuming that it's a question of procedure. Is the minister going to be made aware? Throughout this debate the minister has repeatedly given us her assurance about the way apprehensions would occur. I would assume she'd want to monitor the apprehensions that occur by receiving reports from the director, considering the magnitude of the apprehensions in this process.

Hon. J. MacPhail: I hold the ministry accountable through my executive.

Section 33 as amended approved.

Hon. J. MacPhail: Seeing as we're going to have to step down from committee, I have an amendment to section 31 that may meet the needs of the House. Maybe we can consider it before asking the committee to step down.

The Chair: If that's agreeable to members, given that we stood it down, proceed, minister.

On section 31.

Hon. J. MacPhail: Section 31(2) would now say: "The notice must where practicable be in writing and must include a statement of the reasons for removing the child."

[5:00]

On the amendment.

J. Tyabji: When it says that it's in writing "where practicable," where it's not practicable, will it be orally? How does that section read? The reason I'm asking is that both components are necessary. Obviously the immediate notification could be oral and then followed up in writing. If it's just in writing and you can't get hold of them in writing, what do you do? I'm not sure if the amendment leaves the provision for oral notification.

Hon. J. MacPhail: Yes, it does.

Amendment approved.

Section 31 as amended approved on division.

Hon. J. MacPhail: I move the committee rise, report progress and ask leave to sit again.

Motion approved.

The House resumed; D. Lovick in the chair.

The committee, having reported progress, was granted leave to sit again.

Hon. G. Clark: I call committee on Bill 41.

COMMUNITY FINANCIAL SERVICES ACT
(continued)

The House in committee on Bill 41; D. Lovick in the chair.

On section 17.

G. Wilson: Do you know what? I don't think I'd want to be the minister under these circumstances. Other circumstances, maybe, but not these ones.

I just have one very quick question. It has to do with section 17(a), where it says: "...the sum of money is a fixed sum of money that, with any interest that may be payable on it, is not more than the prescribed amount...." It then goes on to say, in (b): "...to guarantee the payment or repayment has an unqualified obligation to reimburse the corporation for the full amount of the payment...." It sounds as if this is fairly straightforward with respect to guarantees. I am assuming this is put in place in order for it to comply with the acts that govern it -- the financial whatever-it-is act.

Hon. G. Clark: I think it's the Financial Institutions Act, hon. member.

I'll just read you the general notes, first of all.

"As part of its normal business relationships, the corporation may need to provide guarantees or performance bonds for specific projects. Given its powers of a natural person, the corporation is able to provide such guarantees, and in any amount. This section limits the ability of the corporation to guarantee third-party debts only to prescribed amounts as recommended by Treasury Board. As the corporation does not expect to undertake commercial lending functions during the period of the initial business plan it is unlikely that Treasury Board would be asked to recommend a prescribed amount in the near future."

G. Wilson: Just a question, then. It was put to me by somebody who knows a whole lot more about banking than I do, so I'm going to ask it on their behalf, as they're following the debate -- at least in Hansard, if not directly. With respect to these guarantees, does that then allow an opportunity for an alteration in the guarantee during the term of such an indebtedness? Is that something that can be carried over and be binding on future administrations? I would assume that the answer to the second is yes; otherwise, it would imply that you couldn't enter into an agreement that has a longer life than a government.

Hon. G. Clark: The answer is yes.

If I could, I'd just like to flesh out some of the notes in a little more detail than I just described, just to put it in context. Under the Financial Institutions Act, other financial institutions may provide guarantees under normal ancillary business guidelines with no restrictions on the guaranteed amounts. So this is not uncommon. Any other financial institution under the Financial Institutions Act can provide 

[ Page 12050 ]

unlimited third-party guarantees. However, other borrowing restrictions are placed on these institutions under the federal Bank Act, which does not apply to this corporation. They don't have a prescribed amount; they can provide an unlimited amount of guarantees. They're only limited by the Bank Act. This has no such limiting regulation under the Bank Act; therefore we've now applied a prescribed limit on the third-party guarantees.

The extent that the corporation will need to provide guarantees is certainly not apparent at all at this time. Rather than leaving the corporation open to provide unlimited guarantees, as would be the case in other financial institutions -- other than those prescribed in the Bank Act -- this section limits the guarantees only to prescribed amounts. This enables Treasury Board to review and determine the corporation's needs in this area. The approval of the guarantees only in prescribed amounts reduces, of course, the potential liability resulting from any provision of guarantees.

G. Wilson: This is my last question on this. I would assume, then, that the "Disclosure of identity" provisions of the Financial Institutions Act, sections 90 to 94, would also apply.

Hon. G. Clark: Yes.

F. Gingell: Does this section need to state who it's prescribed by? Is there any uncertainty there? Or is that somewhere else in the act?

[A. Hagen in the chair.]

Hon. G. Clark: I'm advised that when it says "the prescribed amount" in the legislation, it's implicit that that means the Lieutenant-Governor-in-Council. We're saying Treasury Board, and then it would have to be the Lieutenant-Governor-in-Council.

Section 17 approved.

On section 18.

F. Gingell: The directors have some very important responsibilities. In corporations, it's usually to examine and approve the business plan, hire and fire the chief executive officer and determine when the corporation will pay dividends. I appreciate that these circumstances are somewhat different, in that all the shares belong to the provincial Crown. But I'm surprised that you specifically take that responsibility away from them.

Hon. G. Clark: We are the sole shareholder in that respect. I don't think it's a fair characterization to say that we've taken responsibility away from the directors. This section was debated in the community, and several people have said to me.... In fact, I think I read some criticisms somewhere about this particular section...

Interjection.

Hon. G. Clark: Yes, in the Powell River News, or somewhere.

...and that we were attempting to gouge people, etc. We were criticized both ways. One was that this would be a money-loser, and then the same individual, I think, criticized that it was somehow going to pay dividends by taxing, if you will, low-income people or charging them for the services. This is here really as part of the overall view of what government has tried to do in the last two and a half years: make sure that there is some discipline on these corporate entities and that we try to operate these entities -- Crown corporations or otherwise -- in a businesslike fashion.

While I think it's highly unlikely that any dividends will be paid in the near future, it's important that we say to the community and to the corporation that there will be tension between the demand for more service in the community, the costliness of that, and the demand to protect the taxpayers. We recognize that, we've repeatedly talked about that, and this adds to that tension. It says to the corporation, "We expect you to attempt to make a profit while at the same time be socially responsible and perform the services we've asked of you in the other sections," and I've talked about that in this House. That's why it's here. I would hope over time that if the corporation is run.... We wanted to send a signal, if you will, to the community and the board that we expect them to attempt to achieve a dividend payment to the owners -- the government. After all, with the investment of $5 million in equity, we would like to see -- down the road, at least -- some return on that equity to the taxpayers.

Section 18 approved.

On section 19.

F. Gingell: Section 19 says that "'depositor' includes 2 or more depositors, considered together as a single unit, who own a separate deposit in the corporation." I am trying to work out exactly why it has been written in those words. I wonder if four depositors acting in concert can get up to something like two times two times four guarantees -- 12 guarantees. Perhaps a good way to start the discussion on that would be, if you have anything in your briefing notes, to define exactly how that works.

Hon. G. Clark: I don't have anything in my notes, but I think the purpose of it is so that people cannot conspire, if you will, to enhance the guarantee that we're providing -- so that people cannot pool their resources and get a greater guarantee than is contemplated by the act.

[5:15]

L. Hanson: This says: "(3) The maximum amount payable by the government under subsection (2) is (a) $2 million" -- which includes principal and interest -- "...if the depositor is (i) a public sector pension plan, or (ii) an entity...." That's kind of an interesting word: "entity." Can the minister enlighten us as to what he envisions as an entity that might be covered under that situation?

Hon. G. Clark: To elaborate on the last question, the definition of depositor is lifted exactly out of the Financial Institutions Act from a similar provision. That fits with my next answer, which is that the definition of entity is exactly the same as in the Financial Institutions Act. In this bill it's the same as that, with one exception: we added aboriginal organizations. While that's a bit of a redundant definition, if you will, the community asked for it because of the high number of aboriginal people in the community and their sense that the financial institution might be able to attract some deposits from aboriginal organizations. That's the only difference from that which exists in the current Financial Institutions Act.

[ Page 12051 ]

L. Hanson: Regarding the guarantee of $2 million, in the sense of a public sector pension plan or this entity, to the minister's knowledge, is there another sort of guarantee where this kind of institution gives that high a guarantee on those kinds of funds?

Hon. G. Clark: Not in Canada, that I know of.

L. Hanson: Because of other commitments I haven't been part of the debate, but I believe that somewhere in his earlier remarks the minister suggested that the expectation for total deposits was a rather modest amount in terms of banking. I suspect that with that kind of guarantee it might be a little more than the minister is suggesting. It would seem to me that, in the competitive world, that's a pretty attractive situation for those kinds of funds, is it not?

Hon. G. Clark: I don't want to go over the debate, but individuals who put money in the Royal Bank, notwithstanding the CDIC guarantee, the Canada Deposit Insurance Corporation.... Most depositors would see any of the chartered banks, the class A banks, as pretty secure and effectively guaranteed by the large size of the institutions. So we're giving it this competitive advantage in order to not provide an ongoing subsidy. But I wouldn't overstate that.

There are two things I have to say about that. First, it's going to be difficult to attract sufficient deposits even with this guarantee, because sophisticated investors -- and pension funds are among the most sophisticated.... While the guarantee is attractive, the rate of return is also an important consideration -- arguably it's the most important consideration. Obviously those are related questions.

Second, I would say, in the broader answer to your question, that there is a limit on how much will be guaranteed by the government. That limit is determined by the Minister of Finance. So if this were successful beyond my expectations, and we were to have people from all around the world wanting to put money in this institution because of the guarantee, the limit in the act to public sector pension funds and some other entities limits it.

Then it talks about other entities as prescribed by the Minister of Finance. The reason for that is specifically so the Minister of Finance could not grant that guarantee in order to limit any exposure if this were to be wildly successful. The business plan upon which this is predicated -- and obviously no business plan is perfect -- indicates that if the institution receives between $80 million and $100 million on deposit, then with a very conservative, very low-risk strategy, this institution will more than break even. That's the only reason for that magic number. It's going to be hard to get that high.

I could say I was successful in convincing Treasury Board to allow this to proceed in part because the Minister of Finance can control the extent of liability that does accrue to the Crown. The extent of liability that I've indicated we would like to achieve -- if I could put it in that context -- is $100 million, which makes this a successful corporation. If we were to go higher than that, I think the Minister of Finance would revisit whether or not to allow any guarantees to continue.

L. Hanson: Maybe the minister could tell us this: because the government is providing this kind of guarantee to those entities, what would the requirements of the bank be for reserves, comparing that to other institutions in British Columbia?

Hon. G. Clark: They are exactly the same as any other financial institution regulated by the province. The Financial Institutions Act requires a certain level of reserves and a certain equity base, and those are being followed in this legislation.

G. Wilson: I've actually got a series of questions on this. Maybe I'll just put out a few, yield, come back and trade, and we'll get through it.

Of all of the sections in the act, this is probably the most controversial, I would think, because of the guarantee that's being proposed. I guess my first question is....

F. Gingell: The whole thing is controversial.

G. Wilson: As the member for Delta South says, the whole thing is controversial. Why the government has to get into the banking business in the first place is controversial enough.

Nevertheless, the entity prescribed in the $2 million guarantee is presumably determined by the deposit. If you are fortunate in attracting a deposit the size of $6 million, shall we say, is it then possible that that entity, whatever it may be -- let's say, by way of example, a union pension fund -- could simply invest in three $2 million blocks to take advantage of three $2 million guarantees? If that isn't possible, can you explain why? What is there to safeguard against that being done?

Hon. G. Clark: The answer is: absolutely not. You cannot break up your deposit to take advantage of the guarantee. It's akin to the answer I gave a minute ago in the definition of depositor. There are several other definitions in the earlier sections.... Further to that, it would not be our intent at all to do that. It's in the institution's interest to have more than a handful of depositors. Another reason for the $2 million guarantee -- aside from Finance or Treasury Board's reluctance to give an unlimited guarantee, as the consultant recommended to make this bank viable -- is that it's not in the ongoing interest of the institution to have one $100 million depositor, if that were at all possible. It's in the institution's interest to have a wide range of many depositors so that it's not vulnerable to a withdrawal at any future date. The $2 million was an attempt at that kind of balance: to provide the incentive to get the deposits but not to provide such an incentive as to have it oversubscribed. It's not our intention, nor is it allowed, I'm advised -- I'll just say this as a caveat -- by staff and the legislative drafters. The advice I gave to the legislative drafters, and the advice which I am told is in the bill, is that it is not possible to break up your deposits in such a way as to take multiple advantage of the guarantee.

G. Wilson: If I could just flesh out that question a little more, the definition of depositor, which is the same definition as we see in the Financial Institutions Act, says that it "includes 2 or more depositors, considered together as a single unit...." So that would assume, then -- and I want to go directly to the pension funds as an example -- that you could have a combination of two funds invested. I don't know if you can tell me if this is correct, but I would argue that as long as the two units considered together were not the same -- if you had a number of funds available for investment -- they would be treated as separate depositors. Why wouldn't that be so? There is nothing in the language of this act, and there is certainly nothing under the Financial Institutions Act that I've been able to see, that would 

[ Page 12052 ]

preclude that. I'm not even sure that it would be desirable to preclude it, if you're trying to get the base investment that you're looking for, other than the fact that I'd be concerned about the guarantee.

Hon. G. Clark: I know they are considered a single unit. That's what this legalese definition means by: "'depositor' includes 2 or more depositors, considered together as a single unit, who own a separate deposit in the corporation." In other words, if the public service pension plan were to subscribe for $2 million and then a consortium of the public service pension plan and the municipal plan had a pooled fund which put an investment in, that portion which was attributed to the public service pension plan would be.... It's the total amount; if their name is attached in any way to any deposit in the institution, it is the sum of their deposits which comes under the $2 million deposit guarantee. It is specifically designed in this way to accomplish that end.

G. Wilson: I confess right up front that I'm wading into an area that I'm not at all familiar with in respect to the law, although I have tried my best to read the Financial Institutions Act to try to understand it.

Would that also mean that if moneys were on deposit...? I want to come back to this fund that the minister is talking about where the fund may be two parts removed from the investment -- if you know what I'm saying. Maybe the minister could point out -- in the Financial Institutions Act, this act or some other statute -- where that would eliminate the possibility for that guarantee to be carried.... I could see where somebody investing in a series of funds may want to do that -- and a number of other funds are currently actively seeking union pension moneys for investment opportunities. The name on the fund does not reflect those which have put moneys into it. In fact, it may even be twice removed from the original source of capital. So if you could just point out where in the act that is covered, I will yield for the moment, and we'll come back to something else.

[D. Lovick in the chair.]

Hon. G. Clark: It's the same as the credit union deposit insurance today, which is on a $100,000 provincial deposit for anybody who deposits their money in a credit union.

To get the guarantee, could you somehow conspire to hide the fact that you have more than $100,000 on deposit? I guess the answer is yes. But in the event of a bankruptcy, which is when there is a call on the guarantee and it's all sorted out, it would become evident that you have more than $100,000 on deposit. Therefore you would only have that much -- the $100,000 -- guaranteed.

Similarly here, if the member is saying: could a pension fund...? First of all, I'm not sure they could do this, because of the fiduciary obligations of the pension fund. But could they attempt to circumvent what is intended here by this section and the definition, or accidentally do it by way of participating in pooled funds, etc.? I guess the answer is that possibly they could attempt to do that. But when the call on the guarantee is made at the end of the day.... These things are all very clearly and diligently analyzed. It would be the same in this case. You would discover they inadvertently or advertently had exposed themselves to more than the $2 million guarantee, and therefore only $2 million would be guaranteed. That's the ultimate safeguard at the end of the day.

F. Gingell: As I said to start with, I must admit I am uncertain exactly how that reads. I accept the minister's explanation. But I'm wondering, because I think we would all agree that it is critically important that we understand exactly what the guarantees are, if the minister could get an opinion for us on this matter before the bill passes third reading.

[5:30]

Hon. G. Clark: If it's desired, I can get it from the Attorney General before it passes third reading.

I'm just looking at my detailed notes again. There are regulations attached to subsection (2). The regulations, which are being drafted now, parallel the provisions of the deposit guarantee in the credit union deposit insurance fund and the Canada Deposit Insurance Corporation. So this mirrors, if you will, the other guarantees. If the member wants some legal comfort in that, then we certainly can do that.

F. Gingell: When we come to the $2 million guarantee, that is only for a public sector pension fund. For any other entity or organization, it is only when it has been approved by the Lieutenant-Governor-in-Council on the recommendation of the Minister of Finance. That becomes a rather ponderous way for a bank to do business, but I can appreciate the minister's need or desire to clearly have control of that.

Is there any intention or thought by the minister that the Minister of Finance and Corporate Relations will start off by approving a description of depositors -- like union pension funds, or union pension funds that have their head office in the province -- rather than dealing with each application one at a time as they come along?

Hon. G. Clark: This time the answer is no; it's each application. I was unable to convince the Minister of Finance to put some descriptions in here which would have opened it up for a better marketing campaign, if you will. If we were to say all pension plans, it would have been a lot easier. Instead, the Ministry of Finance -- and I'm certainly sympathetic to this -- said: "No, we're very concerned about this being too successful, and so you'll have to convince us that an entity, if you will, is sufficiently prudent, or the size of it is justified to warrant the guarantee." That means that if we were to go to the B.C. Tel pension plan -- which is a management plan or a jointly trusteed plan -- we would have to ask them if they would consider investing in this, and then I would have to go to the Minister of Finance and ask her if she would agree to support that guarantee when it went to cabinet for consideration. That's how it is, and it makes it difficult in any marketing campaign, I would say. But again, it was part of the balancing act to protect the public and the Finance minister's obligations, and also to try to promote the institution. At this point there is no broader definition in the act or elsewhere. It is simply that if an individual, or more importantly, if an entity, a pension fund or a corporation would like to take advantage of this guarantee and invest or deposit in the institution, then I, on behalf of the institution, will have to convince the Minister of Finance to advance the guarantee.

F. Gingell: I think that I've come to the end of my questions on section 19, with the assurance that we're going to get some comfort letter on the issue of the exact meaning of that first thing.

What I want to finish off with specifically is.... We spent a lot of time earlier on, I felt, convincing the minister that the 

[ Page 12053 ]

guarantees are a form of subsidy. When the member for Okanagan-Vernon spoke just now, the minister went back to his previous position that the guarantees are not a subsidy. But the moment an investor accepts a lower rate of return in exchange for the guarantee, that is a measurement of risk. That is a measurement of risk that the government has taken on, and that is a subsidy. I just want to make the point, as we finish the discussion of paragraph 19, because I felt that we did have it established before, and it's important that the people of British Columbia understand what is involved. How big that risk is, is for each of us to decide, but the risk nevertheless is a subsidy.

Hon. G. Clark: I'm certainly prepared to accept that there is some risk. You're right, the individual will take the lower rate of return; therefore the risk is moving to the guarantor, which in this case is the government. As you know, it's my contention that with very conservative lending or investing practices, the risk is very small. The chief executive officer of the B.C. Central Credit Union said precisely that. I assure you that there's an intent on the part of the corporation and of the government to try to minimize the risk. But risk there is, and I'm not attempting to diminish that.

Now is that a subsidy? It is something that the government is doing which it doesn't do elsewhere; in that respect, there is some liability moving to the government which wouldn't do in the normal course of events. In a somewhat academic way, one could say that is a subsidy to the bank. But in terms of the operating account of the government of British Columbia, in terms of how it's expensed, in terms of the budgetary line items debated in this House, it is intended that the use of the guarantee eliminates any ongoing operating subsidy from the province. It was in that respect that I was referring to the member for Okanagan-Vernon.

The government is doing two things in an extraordinary way to make this succeed. One is that in the current year there is a subsidy, if you will, of $1 million -- an actual expenditure from the B.C. 21 special account -- that will go to the corporation. That could be construed as a subsidy in the sense that it is expensed in this fiscal year; it's in the budget, and the money is flowing. That is not intended to be spent in this fiscal year -- in one year. Nevertheless, that is money that we, for the purposes of public accounting, have written off. It's invested in the corporation. We're hoping that this will eventually make money and pay dividends to pay that back, but in the meantime we've expensed that. That is what I would call -- in the normal vernacular, I guess -- a subsidy.

The second thing we are doing to make this a success is providing a guarantee to attract a sufficient level of deposits in order to make money on the larger deposits to cross-subsidize what banks now currently lose money on -- small depositors, largely social assistance recipients.

So those are the two things that the government is doing. I fully accept that, and I will be quite upfront about that. We believe there is a very minimal risk associated with this, because it is owned by the government; we plan to invest it only in extremely conservative investments, and to not lend it in such a way that it increases any risk. As the guarantor and the owner, we have a double incentive to do that.

We believe the subsidy this year of $1 million is more than justified in the sense of savings with respect to lost cheques, stolen cheques and law and order -- the cost of policing and other things associated with the problems in the downtown east side, which this is intended to rectify and which amount to more than the $1 million that we are floating this year and that we anticipate will be consumed in the first few years of operation until we get a deposit base sufficient to carry the ongoing costs of the operation.

G. Wilson: I'm prepared to yield on further questions on section 19, but just for the purpose of the committee, could the minister tell us his understanding of what will be provided by way of the legal opinion prior to third reading? That's just so that we're in agreement as to what it is that we have just asked for.

Hon. G. Clark: I undertook to give comfort to the members opposite, and to everybody, about what is a legal opinion with respect to splitting up deposits to try to enhance your guarantee. The question was asked -- and I haven't answered it to the satisfaction of members opposite -- whether there is a sufficient guarantee in the language of this bill and the Financial Institutions Act, because they're cross-referenced, to give comfort that there isn't a way of making the guarantee more than the $2 million and $100,000 guarantees. I've undertaken to have legal counsel give such a legal opinion. I gave that undertaking very promptly to members, because legal counsel have obviously been intimately involved in drafting the legislation. This is a matter which is of significant concern to the government and the Minister of Finance. I'm completely confident that we can very quickly give a legal opinion to satisfy members.

Section 19 approved.

On section 20.

C. Serwa: Perhaps the minister can explain to me why the corporation must pay all taxes other than income tax under the Income Tax Act. Will the corporation be responsible for paying the corporate capital tax?

Hon. G. Clark: It's paying all taxes, including the corporation tax. I'll just give you an explanation. This is a policy decision by government. It needn't be the case. As a 100-percent-owned provincial Crown corporation, the company is automatically exempt from paying federal income tax. We could easily have exempted it from paying corporation capital tax. I decided, and recommended to government, that as a policy decision, we would require the corporation to pay all provincial taxes, the corporation capital tax and the federal income tax. So we will be paying a grant in lieu, if you will, of federal income tax. We don't have to do that. The reason for that is that we wanted to tell other institutions -- banks, trust companies and credit unions -- that this was intended to be a commercial model and that it would not get an unfair advantage in this respect if it were competing for business. Again, as a Crown corporation, it doesn't have to do that. We chose to make it pay all the applicable taxes that any other institution would pay.

G. Wilson: I notice that that's a significant change from the original drafts of the bill that were being circulated, where I think it was to be expressly exempted. The corporate capital tax will, then, presumably only apply to the paid-up capital owing.

Section 20 approved.

On section 21.

[ Page 12054 ]

F. Gingell: I don't have any real concerns that the comptroller general won't designate an accounting system that is satisfactory, but banks are different. Banks do have their own ways of....

Interjection.

F. Gingell: Yes. They've got them all switched around the wrong way.

Banks are different. I would have been more comfortable if the section had said that the corporation must establish and maintain an accounting system satisfactory to the comptroller general and in accordance with generally accepted accounting practices, just because banks are different. I wonder why subsection (1) has been written in this form.

Hon. G. Clark: I appreciate that there is a difference with financial institutions, but this was in part our decision in drafting, but also the comptroller general's request, I guess, or the Ministry of Finance's request. This section requires the corporation's accounting system to be satisfactory to the comptroller general. It requires the corporation to provide detailed financial records when requested by the comptroller general. We're trying to ensure that the records are consistent with other Crown corporations in order to assist in the ongoing review and inspection of the corporation's accounts. It will be consistent with generally accepted accounting principles because the comptroller general will be approving them. The concern of government since we've come to office -- and I think the member generally supported this -- has been to try to have some consistency with respect to how we deal with the government accounts and Crown corporations' accounts in the combined financial statements of the province. So we try to make it subject to the comptroller general, if you will, so they can be consistent across the board. I know the member has a high degree of confidence in the comptroller general, so I hope he appreciates that in some respects that's more important than dealing with the banking, if you will, rules.

[5:45]

F. Gingell: It seems, from memory, that because this corporation is going to be 100 percent owned by the provincial Crown, the auditor general has all the rights and responsibilities that he needs to assure himself of its financial....

Hon. G. Clark: Yes, that's certainly my understanding. As the member knows, the auditor general has not undertaken significant audits of.... Well, that's not completely true. There was B.C. Hydro; there have been some. I know the Public Accounts Committee and the auditor general have been anxious to follow the money, if you will, into entities that have been heretofore more arm's-length. I have supported that drive by the auditor general and the Public Accounts Committee. It's less significant in a commercial Crown corporation; generally speaking, the auditor general is less likely to pursue any kind of value-for-money audit, because it has the discipline of the marketplace, and it's making money. I think this is certainly reasonable in a situation like that of B.C. Rail, which is purely commercial and profitable. With subsidized Crown corporations -- one could take B.C. Trade or something else -- given limited resources and the Public Accounts Committee's direction, he would like to pursue how those Crown corporations are active, because they are in fact subsidized from general tax revenue. I agree with that.

This case is kind of interesting. Clearly I have absolutely no problem with the auditor general attempting to pursue any audit, value-for-money or otherwise, of this creature, this Crown corporation. Even if it is a profitable corporation, the auditor general may well choose to pursue it at some time because of the guarantees. I have absolutely no problem with that. In fact, I would encourage that, although there are probably higher priorities, given the limited resources of the auditor general.

Section 21 approved.

On section 22.

F. Gingell: This is perhaps where we can talk about the role of the auditor general a little more. In fact, I hadn't really thought about this with respect to value-for-money audits but just the general function of balance sheet verification. As the auditor responsible for the overall package of government, and recognizing that the auditor general's office can't do all the audits -- and we surely wouldn't want them to; it's much better for them to have a lot of that work done outside -- it's important for the auditor general to be involved in the decision to appoint an auditor. The auditor general's voice should be listened to, and he should have a statutory right to make his opinions known.

Mr. Chairman, you will remember earlier on we were discussing dividends and saying they had removed the right of the dividend decision away from the directors and pulled it back to the shareholders, which is a different thing. Shareholders have very few rights. The rights that they normally have are to receive annual financial statements, receive dividends when they are declared, elect the directors and appoint the auditors. The appointment of the auditors, who are clearly the shareholders' representatives, is one of the few rights that shareholders have in public companies. What we've done here is take the right to appoint the auditor and given it to the directors. That, to me, is backwards.

Also, section 22 in no way sets any qualifications for the appointment of auditors. That may be unnecessary. There may be some other provision of some other act that, the moment you use the word "auditor," defines the qualifications of that individual. I would appreciate it if the minister would respond, first of all on the question of the qualifications of the auditors, and secondly about the fact that he has given this right of the shareholders to the directors.

Hon. G. Clark: That's a somewhat interesting discussion, and in my time as Minister of Finance I dealt with some of these policy questions.

First of all, the auditor general is not involved in choosing the auditor in any government entities. But the comptroller general is involved in the audit -- in fact, has to approve the selection of the auditor in many institutions. For example, a lot of community colleges have to appoint auditors, and have to have a competitive bidding process every few years.

When I first took office I had a flood of community colleges asking for three-year renewals, notwithstanding legislation that required them to bid those things. Most of the renewals had built-in escalator clauses. I rejected them all and said that they should be competitively bid. I routinely did that, so that the last year and a half as Minister of Finance I didn't have anybody asking to roll over the contract with a 5 or 10 percent increase.

But I guess what I'm getting at is that there are a variety of.... There is a consistency in government, in my view, in 

[ Page 12055 ]

this way. Auditors are chosen by the directors in agencies that are funded by government generally at the recommendation of, or after approval by, the comptroller general. The comptroller general reviews the bid procedure to ensure that it's consistent and then generally approves the selection of the board of directors. In Crown corporations, the board of directors chooses the auditor.

I understand the argument with respect to the auditor general, but I'm generally of the view -- and this is not particularly a government view -- that it is more appropriate for the board of directors to choose the auditors; to have the review by the comptroller general, who is an agent of the government; and that the agent of the Legislature, the auditor general, be then essentially independent of that process. I don't think it's a big issue with the auditor general, and my view is that the auditor general should be independent of the choosing of the auditor, other than to audit, if you will, the criteria which are provided. In a value-for-money audit, that's quite appropriate. The auditor general could say that he's not satisfied the criteria are being followed adequately.

That the board chooses the auditor is consistent with every Crown corporation I know of, although this has an added wrinkle. In the Financial Institutions Act, the superintendent of financial institutions can remove an auditor. So this has an extra test -- a public interest test, if you will -- which allows for removal of the auditor if the superintendent so chooses.

Section 22 approved.

On section 23.

F. Gingell: I had a whole series of notes on section 23, but I'm not sure, after all the discussion we've had, that I need to ask any questions. My notes concern the issue of requiring the financial statements to be tabled and dealt with in a prompt manner and getting in some specific dates. That actually comes up under section 25.

Section 23 approved.

On section 13.

Hon. G. Clark: I would like to call section 13, which was stood down. The member for Delta South has prepared some amendments which I'm prepared to agree to, with one change -- "five" to "three" -- which the member opposite has agreed to. We have had several hours of debate on section 13, and now we have some excellent amendments which I think the member would like to move.

F. Gingell: I move the following amendments.

[Section 13(1) 
    By adding after the words, "for review and approval a", "three-year" 
    By deleting after the words "on behalf of the corporation," "in the following fiscal year" Section 13(3)(a) be deleted and replaced with: "proposed operating and capital  budgets for the next following fiscal year, including any projected borrowings," 
Section 13(3)(c) be amended: 
    By replacing the word "corporation" in the 3rd line the word "entity" and the word "corporations" with "entities" 
Section 13(3)(d) be deleted and replaced with: 
    (d)(i) financial statements dated no earlier than 60 days with comparisons to budget 
        (ii) financial statements projected to March 31 
        (iii) a budget for the next fiscal year]

The Chair: As members have pointed out, given that we have already had considerable discussion on the amendment, I will go directly to the minister for his response.

On the amendments.

Hon. G. Clark: These are very good amendments by the member for Delta South. They are technical amendments which add to the requirements under the business plan to be prepared. I am very pleased to support them. They give more detailed requirements for inclusion in the business plan.

With that, we are certainly prepared to support them.

[W. Hartley in the chair.]

Amendments approved.

Section 13 as amended approved.

Section 24 approved.

On section 25.

F. Gingell: This is the section that deals with the need for the corporation to deliver the financial statements to the Treasury Board, and it talks about "promptly." It's just nice if you've got some definitive limits in there. Ministers of every ministry in this government are supposed to deliver a report on their ministry annually and promptly, and you're all in trouble. The majority of you are two or three years behind schedule. It would be a real mistake to allow this to get behind schedule. The kinds of reports that are required are things that the corporation will be doing in the normal course of events; it isn't some special arrangement. It will just be part of the ongoing relationship between government and the corporation. I was wondering whether you would consider making an amendment to change "promptly" into some definitive date, such as within 30 or 60 days. That would get my support, Mr. Chairman.

Hon. G. Clark: No, I'm not prepared to do that, although I certainly recognize the member's concerns. This is consistent with every other piece of legislation. "Promptly" is really defined by Treasury Board and the Minister of Finance. While I appreciate the member's concern, I wouldn't want to limit it by putting an inflexible time in the act. It's really up to government, and government can be held accountable if there isn't prompt action in this regard.

F. Gingell: There's a much more important one when we get down to the bottom of this section, and that's subsection (3)(c). It starts off: "...if the financial statement contains a statement of changes in net assets or a statement of source and application of funds...." -- or as we now call them, "funds statements." This is a really important part of the financial statements. Well, it's a very important part of the financial statements in a commercial enterprise. Whether it's an important part of the financial statements in a bank, I'm not quite sure. I must admit that I haven't looked at any bank financial statements lately, but it seems to me that a statement of changes in net assets, source and application of funds is something that should be there, and that permissive "if" should be out of there.

[6:00]

Hon. G. Clark: I don't believe it's a permissive "if." I agree with the member that this is an important part of the 

[ Page 12056 ]

financial statements, and it's not intended to be an option. Section 25(3) says: "In addition to any other reports the auditor is required to make under this Part, the auditor must, promptly after a financial statement is prepared under subsection (1), provide to the minister a report on that financial statement and must state in that report whether, in the auditor's opinion...(c) if the financial statement contains a statement of changes in net assets...." I honestly believe, and I'm sure it's the case, that it's a routine question with respect to the financial statement. It's intended that this is not permissive and that the auditor will in fact prepare such a statement if it's deemed necessary. I'm certain that the Financial Institutions Commission and Treasury Board will want such a statement in the legislation. It is not intended that this would be permissive in that regard.

F. Gingell: I've just rushed over and grabbed the Company Act. Section 169(1)(b) reads: "...in the case of a reporting company, a comparative, financial statement relating separately to...." Then (i), (ii) and (iii) are profit and loss, a statement of surplus and "in the case of a company, other than a mutual fund in the Province as defined in the Securities Act" -- which this would be; this would not be a corporation so defined -- "a statement of source and application of funds for each period...." I think it is going to be required under section 169, so subsection (3)(c) is a bit of a non sequitur.

Hon. G. Clark: That may be a legitimate point -- in the sense that the member is correct, and that's why it twigged my memory that it is compulsory. The member is correct that once you extend the Company Act, it essentially makes that so. This may be a bit of a non sequitur -- somewhat redundant would probably be a better term -- but I don't think that's a problem. It simply says that this has to do with the auditor's opinion, and it allows the auditor to comment on these financial statements that contain a statement of changes. Maybe it's a question of the wording, but I don't think it's significant.

Sections 25 to 42 inclusive approved.

Schedule 1 approved.

Title approved on the following division:

Hon. G. Clark: I move the committee rise and report the bill complete with amendments.

Motion approved.

The House resumed; the Speaker in the chair.

Bill 41, Community Financial Services Act, reported complete with amendments to be considered at the next sitting of the House after today.

[6:15]

Committee of Supply A, having reported progress, was granted leave to sit again.

Hon. G. Clark: I note that the House was to rise at 7 o'clock, but in deference to our friends in the press gallery we've moved things along to complete on time. I know that will mean all of us will get favourable treatment at the hands of the press for some time.

Hon. G. Clark moved adjournment of the House.

Motion approved.

The House adjourned at 6:16 p.m.

PROCEEDINGS IN THE DOUGLAS FIR ROOM

The House in Committee of Supply A; G. Brewin in the chair.

The committee met at 2:33 p.m.

ESTIMATES: MINISTRY OF FORESTS
(continued)

On vote 36: minister's office, $412,867 (continued).

W. Hurd: When we last left the discussion, one of the concerns being raised was the impact on ministry staff of the initiatives the government is currently involved in as well as the Forest Practices Code. I think it's fair to say that the code itself will by definition result in a massive training program for ministry personnel. I imagine it will be an immense training program to deal with the complexities of the new rules and regulations, and I'm aware that the ministry has identified that challenge.

I wonder if the minister could advise the committee which specific measures in the coming fiscal year are going to be devoted to addressing the challenge that ministry staff will face under the new requirements of the Forest Practices Code.

Hon. A. Petter: Before answering, let me introduce for the benefit of members the two staff members who are accompanying me at the table today. Thea Vakil, who I 

[ Page 12057 ]

introduced yesterday, is assistant deputy minister, management services division, and Bob Friesen is director of the corporate policy and planning branch.

As we discussed yesterday, there is a major reorganization of the ministry taking place. That reorganization is very much in sync with the Forest Practices Code, because the consequence of that reorganization is to ensure that there are more staff resources moved from regional and headquarters offices into the field through the district offices. That reallocation of staff is itself a major activity that supports the introduction of the code, and it will give the district offices the resources they require to ensure that the code is effectively implemented.

In addition to that, I mentioned yesterday that there is an influx of new personnel as a result of additional moneys that are granted through this budget for the Forest Practices Code. This will enable us to bring in new and additional staff -- I mentioned the numbers yesterday -- in addition to the 200 who will be reassigned through the Spalding review.

In more specific terms, there is a major training initiative underway within the ministry, but it is not confined to the ministry. It will involve partnerships with industry, labour and others to ensure that there is a training program undertaken. I think it's recognized that if we want the code to be effective, training ahead of time can be a very important -- perhaps the most important -- instrument in producing an effective transition to the new set of standards and the new procedures under the code. If we can create a common understanding among ministry staff in the field and at headquarters, various ministries, industry and labour, then we can get ahead of the challenges and work together toward these new standards. Those are, in broad terms, some complementary initiatives that are underway within the ministry to support the introduction of the Forest Practices Code and to ensure its success.

W. Hurd: Could the minister describe what programs or measures his ministry is undertaking in conjunction with the private sector on this new code? Clearly a lot of give-and-take in communication will be necessary in order for the foresters, the field staff and the licensees to work with the ministry.

A review of this set of estimates immediately raises the concern that there appear to be few resources devoted to those kinds of outreach and joint efforts on the part of industry and government. A code with such rigid guidelines, hefty administrative penalties, court fines and costs speaks of the need for a cooperative approach by all people who are on the same wavelength in planning and harvesting activities in the woods.

The reallocation of staff from the ministries to the regions may be one solution. However, without those kinds of conferences or joint planning sessions, there's a possibility that this Forest Practices Code could go off the rails because the ministry would be training in isolation. There would then be the expectation that licensees and others would have to scramble to catch up. It occurs to the opposition that setting the standards, the guidelines and the regulations is one thing. Bringing the personnel up to speed by training both in the ministry and in the private sector is another; they need to scramble as well. Could the minister just amplify on what the government will be doing to better coordinate the efforts of private sector people on the land base with the responsibilities the ministry will have in monitoring and auditing those activities they perform?

Hon. A. Petter: Of course, the whole effort of producing the Forest Practices Code and the standards under it has been one in which we have engaged in extensive public consultation with industry and stakeholder groups.

Perhaps the Chair can advise me. Do we just recess at this point?

The Chair: You're entitled to finish your sentence, and maybe another one, and then we'll recess to go and vote.

Hon. A. Petter: Very briefly, we have an implementation team, and we have been working with industry on implementation of a training program. Under the forest renewal plan there is a proposal, which is being actively pursued and is well underway, for the creation of a forest sector skills council involving labour, industry and government working cooperatively. That council will act as a forum for training as well. So the whole approach to development of the code, its implementation and the training necessary to ensure that compliance and enforcement are conducted with a common knowledge base and a level playing field are being fulfilled through those initiatives.

The committee recessed at 2:41 p.m.

The committee resumed at 2:48 p.m.

W. Hurd: Upon reflection, I have a series of questions with respect to the Forest Practices Code and its implementation by ministry staff in the field. I don't know whether that would require the minister to bring in other staff, but something about the minister's response to my initial query raised some additional questions in my mind. Obviously to deal with a code of this complexity, containing some 360 clauses -- it's a piece of legislation that in some ways rivals the Forest Act itself in terms of its complexity -- will require a major redeployment of resources in the field in order to meet the demands being placed on ministry staff.

With respect to the demand for training that I talked about before the recess, can the minister tell us how many ministry staff are currently involved in training programs that will enable them to deal with the complexities of this particular legislation?

Hon. A. Petter: What's contemplated is about 16,000 hours of training. I can't give a precise number of staff, but those in the field in particular will receive such training, as will others who are involved in other aspects of approvals that require knowledge of the code.

W. Hurd: Can the minister then advise us whether those training hours are in some way being dovetailed with the existing duties of ministry personnel? Will these training sessions take them out of regional offices? Will they be able to perform their existing duties?

I think there's a rationale for these questions, because I'm sure the minister has heard the same rumours that others have about the difficulty regional offices are facing with respect to a number of these initiatives, but particularly with the code. Since it will be such an important part of the ministry in the coming year, could the minister briefly describe for the committee what types of training programs we are looking at here? Are we dealing with fieldwork exercises? Is it classroom instruction? What specifically is being done with respect to the Forest Practices Code in bringing ministry personnel up to speed on it?

[ Page 12058 ]

Hon. A. Petter: The training will vary, depending on the personnel involved. I understand that five modules are being developed to deal with training. They range from fairly general training and familiarization with the code and its requirements for those for whom that is all that's required, right through to the kind of fieldwork and on-the-ground training that would be expected of those who are going to be involved in the actual day-to-day enforcement of the code. They include all of those. The modules being developed speak to the particular needs of personnel in a variety of those roles, some field-related, and some not.

In terms of phasing in this training, there is, of course, ongoing training within the ministry. Essentially what has happened is that the Forest Practices Code training has been given priority so that it can take place throughout the year in a way that is least disruptive to ongoing operations. I would point out to the member that one of the reasons we have this additional influx of budgetary funds -- $13 million for the implementation of the code and additional FTEs -- is that in the initial stages part of that will assist with training, and the FTEs will then be dedicated in further years to the ongoing enforcement. That's one of the reasons for the budget being increased -- the need for extra personnel and anticipated training requirements.

W. Hurd: The training will be a formidable challenge in the auditing, monitoring and enforcement area with respect to what licensees are doing on the land base vis-a-vis the code. Then there will be the somewhat broader and even more challenging responsibility for ministry personnel involved in the small business enterprise program, who will find themselves in the same position as the licensees in planning the new cutblock requirements, the new roadbuilding standards, the new streamside management regimes and the complex number of guidelines and regulations to be enforced.

Could the minister provide more detailed information to the committee? What component of the 16,000 hours would be devoted to the formidable challenge of the small business enterprise program alone, and how much administrative, monitoring and auditing work would go on with respect to the activities by licensees on the land base? Clearly those are two divergent training needs within the ministry. I'm concerned that the ministry is spending more money in the small business enterprise program, by virtue of its heavy administrative workload for the ministry, as opposed to what should be happening out on the land base in order to properly monitor and audit the activities of the licensees which, as the minister has indicated before, and various audits have proven, at times fall short of what the public expects in responsible forest management.

Hon. A. Petter: As the member's question suggests, a number of different approaches need to be taken with respect to training under the Forest Practices Code. One of the modules I referred to will deal with monitoring and enforcement, and one will deal with planning. The focus on planning needs to be incorporated into a training program. Another more general module will deal with the legislative framework for those who are less immediately involved with monitoring and planning, but will benefit from training in the general framework and structure of the code.

All of those will be pursued by the ministry in a way that ensures that staff have the appropriate amount of training to match the needs demanded by their jobs under the code. Certainly, within the small business program, those who are responsible for designing and implementing cutting will have the appropriate training. As I've said before, there will be and has been a relationship developed with industry that will ensure a common basis of information and material for training. The code will be implemented far more smoothly and effectively if we are all working from the same set of materials and understandings. We will therefore achieve, through implementation of the Forest Practices Code, not only better standards and enforcement mechanisms, but also an opportunity to gain a more common and certain understanding of what is required of licensees and those in the small business program.

W. Hurd: The minister has described what appears to be an ambitious training program for the Forest Practices Code. It occurs to me that this code is going to place other demands on ministry staff. Clearly there's going to be a huge additional responsibility of the Minister of Environment, Lands and Parks by virtue of the additional powers that ministry will have under the Forest Practices Code.

Can the minister describe, for this set of estimates, how much additional work his ministry anticipates with respect to the requirements from the Ministry of Environment, Lands and Parks? What kind of work will they be doing on the land base? This is again in conjunction with the code. As the minister announced along with the Minister of Environment, Lands and Parks, there is clearly an overlapping responsibility or accountability for this code, and I feel sure that a voluminous amount of paperwork will be required by ministry staff merely to meet the demands from another ministry of government.

Perhaps the minister could, first of all, advise us whether the training program for his staff will also include some sort of joint effort with the Ministry of Environment and, in particular, whether or not he's confident that, given the resources in the budget -- there have been increases; I acknowledge that -- and the demands that are being placed on ministry staff: the training, the new paperwork being generated by the Ministry of Environment with respect to the code and the other initiatives that remain out there, such as the spotted owl recovery initiative, which is the joint effort of both ministries.... I see the man-hours mushrooming, and I don't see a reciprocal increase in the amount of resources available.

[3:00]

Perhaps I could address my question specifically to the Ministry of Environment. What additional demands does the minister feel will be placed on his ministry as a result of the code implementation and the new responsibility of the Ministry of Environment?

Hon. A. Petter: Far from increasing the work or the resources required, the cooperative relationship that has been established through the development of this code between the Ministry of Environment, Lands and Parks and my ministry will in fact produce efficiencies and will assist us in implementing the code in a way that will be less costly.

I think one of the real problems that now exists is that there hasn't been close enough cooperation between the Ministry of Environment and the Ministry of Forests. At times, in the field, that has certainly caused frustration for licence holders and for staff of both ministries who perhaps have been at cross purposes and have not had a common base of understanding and have not known what the common set of rules are for the reasons I outlined in my introductory comments about the rather chaotic state of regulation that exists in respect to forest practices and regulations. So the creation of a common set of forest practice standards in a code will itself provide a greater 

[ Page 12059 ]

degree of certainty and stability and enable much more efficiency as a result.

The ministries will be working from a common set of materials and that there will be -- I can tell the member -- a common training program to assist the ministries in working in a more cooperative and efficient way in relation to each other, and that will produce net savings. The fact that the Ministry of Environment will be more fully involved in various stages of the code -- and we can debate this when we debate the code -- will mean that licence holders, communities and others will have a much more stable understanding of what their relationship is with government, as opposed to being sent back and forth between two ministries. So we see tremendous opportunities for efficiencies and savings in the relationship that has evolved between these two ministries in the development of the code, and it will continue through its implementation.

In terms of the enforcement side of things, memorandums of understanding will be developed in order to delineate the relationships between the two ministries: how they are to work together to minimize duplication of efforts, to ensure that resources are deployed in a way that complements and strengthens the efforts of each ministry, and to provide a far more coherent and effective form of enforcement than has previously been the case. We see this as a positive move that is going to eliminate, or at least pare back significantly, duplication by achieving a much more common and therefore effective form of regulation.

I would point out -- although it is more appropriately addressed to the Minister of Environment in his estimates, and may well have been by the member -- that additional resources in the Ministry of Environment are earmarked for the code. Far from being a costly undertaking, the effort to bring these two ministries closer into line on this initiative is part of the efficiency that we're seeking to gain, along with the Spalding report implementation and others so that we can implement this code effectively but not at a great cost to taxpayers.

W. Hurd: Without wanting to belabour the training initiative specifically, the ministry is increasing the budget for the small business enterprise program. I should emphasize for the record that as the minister knows, this program places a great deal of additional burden on the ministry by virtue of the fact that the ministry has to do the harvesting plans, the preharvest silvicultural plans and other wildlife management plans. One would assume they'll have to file the same biodiversity protection plans.

It's important to note that this particular program is seeing increased resources in this budget to do the same kinds of things that licensees themselves will have to do on the land base. So one would assume that they'll have to file the same types of information requests from the Ministry of Environment. So that in itself, I would suggest, will create a voluminous addition to the paperwork in addition to the training that might be required within that particular segment of the Ministry of Forests. I hope the minister can break out the training figures of 16,000 hours and advise us what component is going into the small business program and how much of it is being devoted to....

There appears to me to be an almost diametrically opposite type of responsibility there. On the one hand you've got a segment of the ministry that is engaged in the same activities that Fletcher Challenge, MacMillan Bloedel or anyone else might be involved in, and then you've got the ongoing administrative monitoring and enforcement side, which will be almost a different type of activity, one would assume.

I raise that concern because I see a tremendous additional workload for the ministry. I just don't see how it can be avoided. I am putting the alarm out, I suppose, that given the resource allocations in this particular set of estimates, I'm just not sure how the ministry staff is going to cope with that additional paperwork.

Perhaps I could ask the minister about the enhanced monitoring-auditing requirement that will be part of the new mandate for the Forest Practices Code. We addressed this issue with the Minister of Environment during his set of estimates, and I must confess we didn't receive a great deal of information about new techniques or new initiatives that would be undertaken in connection with this. Obviously the minister would agree that whenever you increase administrative penalties dramatically and cause the potential of $1 million-a-day court fines and the loss of cut, it's difficult to meet your goals with a sort of self-regulatory system. I think it assumes a higher initiative for monitoring, auditing and enforcement. I wonder if the minister could describe to us specific budget allocations in this set of estimates that would lead us to conclude that there is going to be a dramatic new expenditure or new initiative in the monitoring, auditing and enforcement area.

Hon. A. Petter: First of all, the member covered a number of different areas, and I won't try to go over all of them. But the member should understand that the activities required, be they in the small business program or by the licensees, are not wholly new. There are some additional activities, but there's also going to be some changes that will, and have already, been welcomed by industry and will be welcomed, no doubt, within the ministry.

For example, right now each preharvest silvicultural prescription is advertised individually. Under the proposals -- again, we'll have a chance to debate these -- there will instead be a five-year silvicultural plan that will be advertised. That will be more efficient for industry, and it will also give the public a greater picture and greater access to input.

What we're trying to do through the code is gain efficiencies in a way that will increase the effectiveness of the instruments at little cost and, in some cases, with a cost saving. I would offer that as an example. There is also the consolidation and change to public disclosure advertising around the five-year preharvest silvicultural plans as opposed to each individual preharvest silvicultural prescription being advertised, which has been expensive and hasn't really provided the public with an overview. That will now be available.

So the member is wrong if he assumes that change necessarily means more cost. In some cases, efficiencies can be gained. While there are costs overall -- I've conceded that -- there are also significant gains beyond what those costs would suggest.

In terms of the specifics on monitoring, I could point.... I guess when we get to vote 37, we can look at it. If the member wants, we can look at it now. But if he looks at vote 37, he'll see under monitoring, enforcement and audit that there has been an increase of over $6 million within that estimate. That is precisely to deal with the Forest Practices Code. I've already indicated that through the reorganization over the next two years, we will be seeing an extra 200 staff moved into the field to assist in monitoring and enforcement, and the increased resources that will flow from this budget will give us much greater capacity in the field. The member 

[ Page 12060 ]

should also understand that we are not relying upon enforcement staff alone in order to produce these changes. It is a combination of efforts.

The audit function under the Forest Practices Board, which will create a public record of performance of both private industry and the small business program, will, I think, create incentives and disincentives. Industry and others will want to do well on those audits because they'll become a form of accreditation if they do well and maybe cause for censure if they don't do well. So there will be incentives through the audit process.

The audits will also act as a form of enforcement, because they will not be announced ahead of time. Industry and the small business program will never be sure when they are going to be audited. That kind of spot auditing system on a regular, provincewide basis will have a tremendous impact in creating the incentives and disincentives that will move us toward a more effective regime of enforcement.

Similarly, the higher penalties aren't there for their own sake; they're there because the current penalties in the act don't create any form of incentive for industry or others to comply with the code -- in fact, quite the opposite. You can, perhaps economically -- and I think many an industry can be given credit for not having done this.... If you just took economics into account, in many cases violating the current standards is probably less expensive than living up to them, when you face a fine of no more than $2,000. The prospect of a more serious range of fines, which will give courts the discretionary power to make the fine appropriate to the transgression, will also act as a disincentive.

So it's a combination of these various initiatives that together, we believe, will produce change in the most effective and efficient way at minimal or least possible cost to the taxpayer and hopefully at least possible cost to industry as well.

W. Hurd: Can the minister then describe, with respect to the auditing and monitoring function, what responsibilities the ministry will have to the Forest Practices Board, which may, for example, receive a public complaint? It was interesting to note that some of the ministry's staff who briefed us on the code advised us that they hoped the public would approach the ministry first before launching a complaint. I wonder how often that might happen.

Assuming that the board were sufficiently concerned to order an audit, would they have to undertake that on their own? Would they be seconding ministry staff to assist? Where are the resources coming from to carry out that additional auditing and monitoring function? Clearly the code, because of its complexity and because of the ongoing training -- the minister has acknowledged that training will be a critical initiative in terms of the success of the code.... Given the fact that there may be an additional need for auditing and monitoring, what responsibility would the ministry have to provide information or perhaps to provide audit staff, or will there be any requirement of the ministry at all?

Hon. A. Petter: Well, if we wish to explore in more detail the relationship between the Forest Practices Board and the ministry, it might be more appropriate to do that when we get into the committee stage on the Forest Practices Code of British Columbia Act. But in general terms, the audit function that will be performed by the board will not utilize ministry staff. The board will conduct the audits independently of the ministry, because in some cases, as I'm sure the member is aware, the ministry and in particular the small business program will be the subject of those audits. We see that occurring through the board. The board may wish to do that through contractual relationships or through deployment of their own resources or by whatever is the most effective and efficient means possible.

[3:15]

In terms of the role of the ministry, I see that very much as the front line of enforcement when the public has concerns about conduct. I anticipate that the public will initially go to the ministry, as they do now. I expect that the board, as is the case with most boards that have this kind of overseeing or watchdog role, will expect the public to exhaust the more immediate means available to them before they take any further action. The board's role will be one of oversight -- in the positive sense of oversight, I might say. They will oversee the code, and the public may take concerns to them, but I anticipate that the board will expect the public to initially pursue whatever remedies are available to them, as is now the case.

In general terms, I think that answers the member's questions, but if he wishes to get into more detail on the relationship of the board and other agencies, that may be better explored in the context of committee stage debate on the act.

W. Hurd: Given the $7 million increase for monitoring, auditing and enforcement within this year's set of estimates, can the minister tell us how much of that money is going to go to monitor the ministry's compliance under the small business enterprise program? The ministry is clearly the largest cutblock planner in the province, and one would assume it will therefore face a most formidable challenge in ensuring that its own activities on the land base comply with the new demands of the Forest Practices Code. How much of this $7 million allocation is going into monitoring the activities of licensees and others who have licences to harvest timber in the province? How much of it will go simply to monitoring the ministry's own compliance with the terms of the code?

Hon. A. Petter: The short answer is that I can't provide the member with a number broken out in that way, because the budgeting process hasn't been done like that. Some of these funds will go to support audit functions of the Forest Practices Board, and I can't anticipate how the board might wish to pursue its audit program. It will have to be done in a way that meets the board's objectives of ensuring that there's an effective audit provincewide. Other funds will go toward different aspects of monitoring in different parts of the ministry, so I can't provide that kind of breakout.

I can say that within the small business program, there certainly will be resources provided to ensure that that program and the people who implement the program are able to live up to the requirements of the code and that licensees -- those who operate through the program and who hold opportunities and small business licences under it -- will live up to the code's requirements. There will be monitoring of their activities to ensure they live up to the standards. I can't give a definitive breakout from that particular part of the estimates in the way the member has asked, and I don't want to mislead him by pretending I can.

W. Hurd: The next question is obvious. The minister has alluded to 200 additional field staff who, one assumes, will be out walking the land base to determine compliance. Of those 200 or so people who have been added or allocated for that purpose, how many are going to be out there monitoring the activities of private licensees, and how many 

[ Page 12061 ]

will be looking at the small business program? Will it be a coordinated effort?

I will again allude to the fact that the ministry, as a matter of philosophy, has made a decision in this budget to allocate more resources to the small business enterprise program, which I understand supports a more entrepreneurial value-added industry. I certainly support that; I think it's important. I served on the committee that recognized the potential of that particular sector, but it occurs to me that the costs of expanding that program will be considerable in terms of all the initiatives going on -- for instance, the Forest Practices Code. I expressed the concern that the resources the minister has identified in his budget may well be going toward that program rather than toward the additional requirements for licensees who are involved in activities outside the ministry.

If the ministry is devoting more resources to the small business program, it is assumed that more paper will be generated from the licensees as opposed to audits, monitoring and enforcement in the field, which almost creates a cycle of additional demand for the ministry.

In terms of the additional staff being hired for monitoring, auditing and enforcement, can the minister provide us with some idea of where they will be, what they will be doing and whether their activities will be devoted toward licensees or other programs within the ministry? What are we dealing with here?

Hon. A. Petter: First, I will clarify the commitment to the small business program. The additional $30 million is to ensure that more volume is available through that program. Obviously that volume will have to be made available in a way that's consistent with the requirements existing at the time under the code, etc. This has been budgeted for.

Under that program there are opportunities for getting additional wood available in certain parts of the province. As the member has indicated, a very active and entrepreneurial sector has emerged in this province, and we want to ensure, through this additional commitment, that they have access to wood and that the wood doesn't become backlogged, but is made available so that full entrepreneurial potential and value-added initiatives emerging under that program can be realized.

I can't provide the member with crisp, clean divisions because, as he well knows, that isn't the way the ministry works. Within various districts, the needs for monitoring and enforcement will concentrate in some areas and in some components as opposed to others. In some districts, TFLs are prevalent and in others they are not; in some districts there are different approaches to one form or another of tenure or forest operation. We're ensuring that each district puts in place a program to ensure that the monitoring enforcement through the code is appropriate to local circumstances and needs, and will provide the resources needed by the district to carry out its responsibilities under the code, as well as its responsibilities to enforce the code.

W. Hurd: Surely increasing the amount of timber available under the program creates a reciprocal demand for planning and implementation with this program.

Hon. A. Petter: That's why there is $30 million more.

W. Hurd: The minister talks about $30 million more. One assumes there will also be a reciprocal amount of revenue increases. Can the minister tell us, in terms of the total resources of his ministry...?

[3:30]

Obviously this program consumes a larger percentage of the resources of the ministry than any other. Does the ministry seek to properly identify the costs associated with this particular program, since small business program -- and I'm sure the minister will agree -- is totally unlike any other ministry activity due to the additional responsibilities for cutblock planning and preharvest silvicultural plans? They now have additional responsibilities under the code, the same as those faced by a licensee. I will ask the question again: does the ministry attempt to discern the costs of this particular program across the ministry in order to ensure that the costs they're facing are competitive with what the private sector might have to pay? What type of systems analysis are we doing with this particular program which, as the minister has acknowledged, goes across the range of activities of his ministry? Obviously he has staff who are not working specifically on licensees' concerns, because they are also working with this program. I think it would be important for us to know what percentage of the overall resources of the ministry is being devoted to this program. Does the minister see any value in identifying those costs?

Hon. A. Petter: I can give the member a very general sense of how we tried to divide the labour within the ministry for budgetary purposes. Obviously it varies within district offices, and the deployment of the workforce will be designed in such a way as to accommodate the most effective use of resources within that district, given the conditions there. If one takes the overall field staff in the ministry, which is about 3,800, I'm told that about 426 of those are allocated to the small business program which, I think, is roughly comparable to the percentage of the cut attributable to that program. But it will vary from district to district and from circumstance to circumstance.

W. Hurd: Are the 426 devoted full-time to the program or part-time?

Hon. A. Petter: It's budgetary.

W. Hurd: Okay. That wouldn't include, then, work that was done for the program on a casual basis by other planning staff.

I think it's an important issue because of the demands being placed on the ministry generally. I would suggest to the minister in the strongest possible terms that if you want to bring forth the code, the protected areas strategy and the other initiatives that are underway on the land base and at the same time expand a program that calls for cutblock planning by one segment of the ministry, which is involved in the same kind of activities as the major licensees, it would be vitally important to determine how much of your overall resources are being allocated to that one program. Otherwise there's the potential for that one segment of the ministry to start demanding more and more of the allocation of resources in order for the ministry itself to meet the new demands being placed upon it.

I return to the Tripp audit, which was conducted on Vancouver Island on compliance with fish and forestry guidelines. It was an audit which the ministry struggled to meet itself. Naturally, that information didn't make it into the information distributed to the media at the press conference. Nevertheless, the ministry had its own problems in meeting that type of audit.

I think it's important for us to be aware of how much of the total resources of the ministry would be going into this program, whether the minister is concerned that the new 

[ Page 12062 ]

requirements of all these initiatives are going to place additional burdens on that program and whether he's completely confident that the additional revenues that have been announced under the program, plus the new allocation of people in the field, will be able to meet those new demands. I'm sure he agrees with the importance of having the ministry comply with all the same practices, codes, standards and regulations that the private sector has to meet. I would just offer the plea perhaps that it would be helpful if the ministry were to make a commitment to really isolate the cost of that program, not just the direct FTE allotments but the ministry staff who might be involved in undertaking some small measure of work for that particular program, so we get a better feel for how much of the ministry's total resources are being devoted to a program that accounts for only a portion of the annual allowable cut in the province.

Hon. A. Petter: I understand the member's plea for a simpler world, but it doesn't work that way, and it would be horribly inefficient if it did. If we ran the small business program as though it were completely disassociated from the other elements of the ministry, we couldn't take advantage of all sorts of economies of scale or expertise. In various district offices, what we do is to have some of the personnel working part of the time on the small business program and other initiatives. When we do training, it would be crazy to have a separate training program for the small business program just to accommodate the member's concern for a separate budgetary account.

But in the budget process, we clearly attempt to identify both FTEs and budget allocations that can be attributed to that program. The member's general concern -- that we're able to attribute the costs that derive from that program -- is a legitimate one. I've provided the member with those figures in terms of FTEs. They're notional but as accurate as we can make them. The budget estimates refer to costs relating to the small business program, which we've discussed, and to increases in that program, which we've also discussed.

I hope the member isn't suggesting that we should abandon all economies of scale and all the sensible arrangements we made in district offices that don't lend themselves to neat divisions but do lend themselves to more effective operations.

W. Hurd: I'm sure the minister is aware of the concern expressed by some that this particular program, as valuable as it is, consumes a disproportionate amount of ministry resources. It seems to me that if you can't measure it, you can't put a value on it.

I know, for example, that the ministry breaks out the amount of stumpage payments in arrears with this particular program. I assume there are lots of activities on the revenue side. The minister says so, and I'm sure there are. The amount of stumpage in arrears or the revenue that generates to the program all goes into general revenue. These are breakouts I'm sure the government does all the time. If you're not prepared to look at the costs associated with the program, then you can get a pretty false perspective of its overall value, so I throw that out there. If you can't measure it, you can't audit it or determine its overall success.

When we're getting into the kind of scenario we're in now, many additional demands are going to be placed on this particular program, along with the other licensees in the province. I'm seeking assurance from the minister that the additional $7 million going into auditing, monitoring and enforcement will be allocated on an equitable basis and not devoted to a program that accounts for only a small fixed percentage of the overall annual allowable harvest. In the course of these estimates, I hope we can get a more accurate feel for where the additional $7 million is going, what specific measures are being undertaken and whether it is being allocated on a fair and equitable basis.

With respect to the 3,800 field staff, can the minister advise us how much of a staff increase that represents over the last set of budget estimates, given the increased demands that we've acknowledged are being placed on the ministry? Where are we going in terms of full-time-equivalents within the ministry?

Hon. A. Petter: Because the ministry has been pursuing efficiencies to ensure that we do not burgeon, but become lean and effective. The net overall increase in FTEs within the ministry year to year is 42. I mentioned earlier that there has been additional allocation, which has resulted in 86 FTEs, for the Forest Practices Code, but in other areas there have been additional efficiencies gained. So the net increase overall is 42 FTEs.

L. Hanson: I have a issue that I would like to canvass with the minister. The minister is probably looking up his notes on it because, knowing what happens in this world, he's prepared.

The issue is the salvage operations on dead and diseased timber around the province. What is the ministry's policy on it? It is very confusing; it seems to be different in different forest districts. I'm sure he knows about this issue already, but I want to put it on the table. There are small stands of timber that are dead from bug infestation or other causes, such as being blown down. These small stands are not commercially viable for larger operations to harvest. As a result, there are a lot of salvage loggers.

Information in the Vernon forest district office records harvesting from 1991 up until so far this year. In 1991 there were 113,000 cubic metres harvested, according to the information I have. So far this year, which is halfway through, there has been about 13,000. It doesn't seem to be the result of less infected or less salvageable timber; it seems to be because it's much more difficult to get authority to do it. I understand that the process in our district is that if these entrepreneurial salvage people identify timber for salvage, they go to whatever company has jurisdiction to obtain the rights to it. Generally they say: "We'll handle it." Often nothing happens, and eventually the timber, because of age, becomes lost to the market and to British Columbia as far as revenue is concerned.

It seems to vary from district to district. Some districts suggest that the reason it isn't harvested by the larger firms is that the volume of timber is not enough to warrant it. Others say that the amount of timber salvaged by the salvage operators is charged to the annual allowable cut of the firm. The firm doesn't want to do it, so they ignore it. The timber is lost to the salvagers and to British Columbia as revenue. I think the minister is familiar with the situation that I'm talking about. Maybe I could hear his comments on what the ministry's policy is.

Hon. A. Petter: Perhaps I can most accurately comment by sharing with the member the note I received in response to concern that's been raised about this. The note indicates that during the past ten years the Vernon forest district has issued numerous small, direct timber sale licences for salvage, principally of mountain pine beetle-infested timber, wind-thrown timber, white pine blister rust-infested timber, 

[ Page 12063 ]

dead cedar trees and other forest pest-infected timber. These sales permitted the removal -- normally done through selection harvesting -- of small volumes of timber that otherwise would have been lost or destroyed. However, there is a large variation year to year in the availability of that timber. According to the information I have, that variability has depended -- contrary to what the member suggested -- on the size of infestations or blowdown. In 1985 the district sold approximately 22,000 cubic metres, while in 1991 the total volume, which the member indicated, reached 113,000 cubic metres. In 1992 and 1993, in response to reduced levels of blowdown and insect infestation, the level of district salvage sales dropped to approximately 60,000 cubic metres per year. The volumes harvested for small timber sales were charged to the Forest Service reserve, the small business forest enterprise program or, in those instances of major licence non-performance, to the licensee's allowable annual cut.

[3:45]

I think the problem comes from some of the changes in beetle volume. Current beetle surveys and plans indicate that the beetle population has declined to the point where major licensees are now able to deal with the bulk of salvage wood under their licensed AAC, and that is causing the problem for salvage operators. Where there are high levels of infestation and the resulting levels of salvage can not be handled by major licensees, salvage opportunities are provided. As the degree of infestation has diminished, the policy of the ministry is to look to the major licensees to deal with what they can. As a result, the major licensees are able to a large extent to deal with the current level of salvage wood under their licensed AACs.

The district informs me that notwithstanding the efforts of major licensees, the ministry has made commitments through beetle management plans that some salvage would continue to be available through timber sale licences. However, due to declining infestations, the projected volumes are -- as the member has indicated, and it is the source of the member's concern -- considerably less than in previous years. That, I guess, has caused some concern among salvage operators who have, frankly, developed a reliance on salvage wood and are understandably concerned that salvage opportunities are no longer there. Unfortunately, we can't create more beetle infestations in order to increase the opportunities for salvage. I guess that creates something of a dilemma. I have asked the Vernon forest district to continue to work with salvage operators, and the district will continue to offer limited opportunities for direct salvage timber sale licences, but the number of those licences will be limited by the supply of salvage timber.

I should also say to the member that this government -- and I think it's reflected in the forest renewal plan -- is concerned where timber is not being fully utilized. I have asked all ministry staff in the district and regional offices to look at their current policies in order to identify ways to achieve higher standards of utilization and to afford new opportunities for salvage. Unfortunately, in this particular district a crunch has resulted from what is seen as good news in most cases -- the reduction in insect infestation -- but that is causing a problem for those who have come to depend upon that salvage wood.

W. Hurd: Do I understand that this is pretty well a universal policy that applies to all forest districts, or are there a variety of policies in the different forest districts?

Hon. A. Petter: I'm informed that the policy is by and large the same. The ministry's goal is to ensure that licensees have a responsibility for the profile that exists. Therefore they have to get, to use the colloquial expression, their share of the pain. However, in a particular district, if the amount of salvageable wood increases due to something such as an infestation, obviously it would not be reasonable to expect licensees to take on that full load. That's when extraordinary salvage opportunities become available. So it isn't so much the policy but the profile within the particular district that may produce a different approach for the period in which there are unusually large volumes of salvageable wood. That, I take it, has been the case in the Vernon district.

L. Hanson: As I understand it, there has been a reduction in the timber necessary to salvage. I guess we really don't want more infestation or problems that way, so that's good, as the minister said.

The district's first responsibility or first response to the identification of timber that should be salvaged is to the licensee. If the licensee, for whatever reason, is not prepared to harvest because of small amounts or whatever, then do they go to a salvage bid process? Or do they go to whoever identified it? As I understand this situation, we have salvage loggers looking at timber much like miners do, if you will. They search for stands of timber that may be diseased as well as situations where timber has already died or been blown down by weather.

Hon. A. Petter: Yes, I'm aware of the concern. When I was up in Vernon and Salmon Arm recently, some of the local operators who have an interest in salvage spoke to me about this. I take it that at times in the past policies have allowed those who find the salvage opportunity to receive a direct award of that salvage opportunity.

The fact is, though, that as wood has become more valuable and as the competition for salvage wood has become greater, the policy of the ministry has changed. I know that in the Kamloops region there is such a value and interest in salvage wood opportunities that the fairest way of distributing it is to provide a competitive process. That change in practice, I know, has caused concern on the part of some, because it requires a competition. It requires a higher price to be paid, which, of course, is consistent with the responsibility of the ministry as steward of the resource. But for those who previously may have enjoyed access on a non-competitive basis, it has caused some concern. So that change has caused concern, just to confirm the member's point.

I think it can be defended as a responsible public policy in response to the fact that the value of and demand for even salvage wood have increased. Far be it from me to lecture the member on market mechanisms, but it seems to me the market is probably the best way for allocating those opportunities in those kinds of circumstances.

L. Hanson: Well, the minister seems to be defending the policy. I wasn't critical of the policy. I was trying to understand it.

Hon. A. Petter: Some of your constituents are.

L. Hanson: Well, that's fair enough, but constituents are sometimes critical of a number of things. I'm still trying to get a really clear understanding of the policy. We do have these people circulating in the forest looking for these sorts of stands, because in the past they have had the privilege of 

[ Page 12064 ]

having first choice on that if the licensee was not interested in it.

As I understand the policy now -- to have it absolutely clear -- if they should identify that, the Forest Service is first of all obligated to talk to the licensee or whoever has jurisdiction, if it happens to be in an area belonging to a particular licensee. Then if that licensee doesn't show any interest in it, they put it to a bid process. Is there a process whereby the licensee is monitored to make sure that wood is harvested, once it's identified?

Hon. A. Petter: I don't want to provide the member with an overly simplistic picture that isn't accurate. My understanding from staff is that, as the member indicates, where there is salvageable timber identified and the volume of that timber is such that it is expected to be an obligation of the licensee, the minister would look to the licensee to harvest that as part of the AAC.

Where the licensee had demonstrated an unwillingness or inability to do so, however, the ministry, rather than insisting on that, would then provide a competitive opportunity for access to that salvage. And if it were determined that it was a licensee's obligation that had not been fulfilled, that portion of the cut would be charged against the licensee's AAC. So that would be the procedure.

If it were determined that it was beyond the licensee's capabilities or expectations under the licence, then the opportunity might still be provided, if it were a suitable opportunity. But in that case it would be provided on a competitive basis with a cut being attributed not to the licensee's AAC but to other components of the allowable cut within that area.

L. Hanson: Well, the policy changed not too long ago as far as the finder, if you will, is concerned. The volume has decreased considerably because, I guess, the forests are healthier in our area. There still is that opportunity for the salvager to get that timber but only through a competitive bid process, if the licensee doesn't want to harvest it or can't harvest it -- or whatever the reason might be.

I'm not trying to make it too simple, but a layman like myself needs that kind of simplicity, I guess.

Hon. A. Petter: As another layman or layperson, I must say that by and large that is my understanding of it. In terms of when the policy changed, I can get the member an exact date. I can't give one, except to say that when I was up there about a month ago, I discussed it with the regional manager. It was my impression that it had changed within the last few years.

I raised this concern with the regional manager, and I'll pass it on to the member. The concern I expressed was that if one moves from a finder's system to a system of competitiveness, there is a danger of losing the incentive to identify incremental opportunities for salvage. The regional manager indicated to me that it was a concern. In fact, the appetite for this wood is so strong now that even though a finder will have to go through a competitive process, they're still finding that there is a strong incentive within the system, and there are still opportunities being identified in the same way they were before. That's obviously a concern. If the consequence was to take away incentives to seek out these opportunities, then it could be that the policy would have the unfortunate effect of not scrutinizing licensees as well as they might have been when the person who found it got to keep it.

L. Hanson: That is a policy, though, that applies to all of British Columbia, in general terms. I recognize that different circumstances in different areas cause a need for some variation, but generally speaking that policy applies throughout British Columbia.

Hon. A. Petter: My understanding is that that is the prevalent policy. I want to be a little guarded here about it. I can find out definitely. However, I'm informed by staff that there may be exceptions, but they're few and far between. My recollection of my discussion with the regional manager at the time is that there still may be some exceptions. In circumstances where there is not strong competition in the area or enough operators to ensure that salvage opportunities are pursued, direct awards may still exist. My understanding is that because of the current wood market, and because even salvage wood is so valued, throughout most of the province the process that he has helped me to enunciate is the one that applies. There may be localized areas in which there is a sort of finders-keepers system; to do otherwise would take away the incentive for people to seek out salvage opportunities.

[4:00]

L. Hanson: I have one final question, hon. Chair. If the minister finds through investigation that there's some variation, would he undertake to let me know?

Hon. A. Petter: For the record, my answer is yes.

W. Hurd: I have a series of questions about the progress of the timber supply review in the province. I wonder if the minister could update the committee on the number of timber supply areas in the province that have currently been properly inventoried. How many have had long-term annual allowable cut levels established? If I could have that information, then I have a series of other questions, hon. Chair.

Hon. A. Petter: In order to introduce this discussion, one has to understand how the timber supply analysis works. It's a multi-step process involving public involvement. It starts with a timber supply analysis, which is followed by a discussion paper and socioeconomic analysis, and it culminates in AAC determination. I can have staff imbue more certainty in some of these answers. However, my recollection is that one AAC determination has been made under the formal timber supply review process. That was in the Fort Nelson TSA, which we referred to yesterday.

With respect to the rest of the process, the purpose of the review is to update timber supply forecasts in all 36 of the timber supply areas, and at my last count, 15 timber supply analyses have been completed and are available for the public. That process and those analyses have not yet culminated in a conclusion of the process by the chief forester in making an AAC determination.

W. Hurd: Is not the ministry, through the chief forester, making 70- and 80-year generalizations about sustainable annual allowable harvests? I refer specifically to a ministerial announcement in Golden, where an 80-year long-term sustainable harvest was identified based on current reforestation activities and investments. Is the ministry doing a long-range projection based on current practices within each TSA?

Hon. A. Petter: Yes, the way in which the timber supply analysis process works is that the ministry, through the 

[ Page 12065 ]

offices of the chief forester and his staff, does a profile of the timber supply. Based upon current management practices, it extrapolates from the existing inventory of timber supply, conditions and management practices a long-run sustained yield -- LRSY -- line. That line is a function of the accumulation of that data and those assumptions and is the basis of a number of established scenarios through which one might move from the current annual allowable cut to achieve long-term sustainable yield, based on that analysis.

The information is provided to the public and is followed by a public discussion paper and socioeconomic analysis. The public has an opportunity to comment on that information and to provide feedback on the socioeconomic aspects of the assumptions made, as well as other aspects of the review. The chief forester then makes a determination of AAC in accordance with the requirements of the act in order to establish an AAC that meets the socioeconomic objectives and also is consistent with trying to maintain the principle of sustainability.

W. Hurd: Given the demands we've talked about earlier with respect to the ministry in the coming year and the minister's acknowledgment of a marginal increase in FTEs, can the minister advise us where we're going with this review during the coming year? How many additional TSAs do we expect to complete, and will they all be done with the 70- or 80-year time frame for a sustainable AAC? Perhaps you could clarify this.

Hon. A. Petter: There is an increase of about $60,000 and two FTEs in the budget, in addition to a very significant influx of resources when the timber supply analysis was created to expedite this kind of analysis. There was no adequate inventory of resources, and timber supply review processes were not being done in a timely or adequate way under the previous administration. This year the funding will be utilized for delivery of about 24 timber supply analyses, 28 socioeconomic analyses, 30 public discussion papers and 21 allowable annual cut determination reports, if the chief forester is able to maintain the schedule he has set.

This is a very ambitious schedule, but one that the chief forester feels is essential, as does this Legislature through its action. It is essential we get the baseline information we need, not only for the chief forester to establish appropriate annual allowable cut determinations, but also so we can have a database upon which to influence positively, through the forest renewal plan and other initiatives, the long-term sustainable yield and have a positive effect.

In many areas, as a result of the work that's been done under the timber supply analysis, opportunities are being identified through the public discussion paper, socioeconomic analyses, etc., to enhance selection harvesting -- for example, commercial thinning -- through better timber management. Or there may be deciduous opportunities. This was the case in Fort Nelson. The review enabled the chief forester to determine that there were opportunities in aspen which could produce economic benefits in the area that would also have a positive environmental impact because of the waste left as a result of a previous licence granted for chopsticks.

The review is there not only there to determine a long-term sustainable yield based on current practices but also to tell us how we might change those practices in order to improve the long-term sustainable yield and what additional opportunities may be there. It's a very important process in assisting the government and industry in trying to deal with some of the difficulties that are confronting us if we don't change our practices and if we don't get on with the job of improving the way we approach forestry in this province in order to increase our capacity to harvest timber in the future.

W. Hurd: The minister will certainly be aware of the review of the timber supply process for B.C. timber supply areas in March 1991. I think it identified quite accurately the scope of the challenge. It also talked about some of the major deficiencies that existed within the ministry itself in terms of addressing the timber supply analysis in a timely manner.

Some of the major findings -- I'm just reviewing them here -- were that ministry staff felt that the cut levels were too high and timber supply analyses are being done too slowly. They also talked about the Forest Service having lost its leadership in the area of timber supply analysis by not aggressively recruiting expert staff and maintaining the area as a high priority.

There was also a lot of talk about the need for training ministry staff in order to meet this ambitious program. I wonder if the minister could describe for the committee what we're seeing in the current fiscal year with respect to training initiatives on the timber supply analysis process. What has the ministry been doing since March '91, given that the report really identified the fact that many key personnel at all levels of the ministry have a poor understanding of inventory and timber supply analysis procedures?

Certain uses and manipulations of forest data are inappropriate and inaccurate. Are we seeing any additional resources devoted to training? Where are we in terms of the conclusions in '91 compared to what's happening now?

Hon. A. Petter: I'm very pleased that the member referred to the report because, of course, that document informed British Columbians of the sorry state the previous government left this province in, in terms of coming to grips with timber supply analysis. For that reason the previous minister took the steps he did to implement the timber supply review, and considerable resources were committed in previous years.

As a result of that, I'm informed by staff that most of the training necessary to support this initiative was undertaken at that time, and the core staff was put in place. I'm told there are still training initiatives at the regional level. Improved inventory work is going on with more staff. This is an ongoing initiative. The initial training to support the timber supply review was done in past years, and the ministry now has the capacity both in terms of staff commitment and in terms of expertise and training to undertake this review.

Having said that, it's still a mammoth undertaking to bring in, within a three-year time frame, a review that is normally supposed to occur over five years, based upon an ongoing accumulation of data in a timely way. So for the ministry to undertake what it is doing -- namely, come to terms with a timber supply review within three years rather than five, based on an information base that is highly inadequate for the reasons the member has indicated -- it does require a major commitment of resources. That was reflected in past budgets, and it is reflected in this year's budget.

I must correct myself. The increment in funding is in fact $630,000 not $60,000, and the training goes on to support that.

I know the chief forester is hopeful that he'll be able to meet the target of completing the entire review within that three-year time frame, but I want to say quite frankly to the member that it is an ambitious target. Some of the original 

[ Page 12066 ]

target dates have not been achieved, because the chief forester is determined that the review be accurate, that the work be done properly and that the public be afforded an opportunity to ensure that there is scrutiny. The review is somewhat behind schedule, but I think what has been accomplished is extraordinary, given the history that he referred to. I give full credit to the chief forester and his staff for having moved us out of a very bleak situation to a situation where we now have a credible timber supply review, and that review is unfolding in the way I've described.

The Chair: Hon. members, I think we should recess for a few moments to go and vote.

The committee recessed at 4:14 p.m.

The committee resumed at 4:26 p.m.

W. Hurd: When we left we were discussing the ongoing timber supply analysis in the province. Obviously the purpose of the review is to allow the chief forester to set annual allowable harvests which are sustainable over time. Can the minister tell us whether the work that has been completed -- the timber supply reviews, the discussion papers, etc. -- will in any way be affected by these other overlapping initiatives which are not part of the analysis, such as the protected areas strategy and more recently the Forest Practices Code? Is the ministry going to be required to go back to the work that's been completed to try to factor in the effects on the harvest levels of initiatives like the Forest Practices Code?

The Chair: It sounds like we have another vote. We will take a recess.

The committee recessed at 4:28 p.m.

The committee resumed at 4:35 p.m.

W. Hurd: When I left off the discussion, I was talking about the initiatives the ministry is currently involved in that might affect the work of the timber supply review. The ministry releases discussion papers or other information about the work of this particular timber supply review initiative, and it talks about current AAC levels and the jobs that are dependent on that annual allowable cut. The information released on April 20 on the Golden timber supply area talks about a 70-year timber supply projected to decline to 309,000 cubic metres. The purpose of the timber supply review throughout the province is obviously to establish a benchmark annual allowable harvest that is sustainable over time.

My question relates to how much additional work will be required as a result of the effects of the Forest Practices Code and the other initiatives the government has underway, including the independently operating protected areas strategy. Are we dealing with an immediate need to revisit some of the chief forester's findings? How are we able to build in the changes and the adjustments to timber supply that have been announced as a result of initiatives such as the Forest Practices Code? Is there some sort of methodology that will enable the ministry to revisit these figures in a timely way without having to do the kind of work that was required to bring them up to speed?

Hon. A. Petter: Allow me to introduce Darrell Errico, who is manager of the timber supply section and is intimately involved in the timber supply analysis and review process.

The work that the ministry does through the chief forester's office is based upon a certain set of assumptions about the current land base and current management practices. In making assumptions about current management practices, however, the ministry has largely anticipated and built within the assumptions in the current review the kinds of practices that are anticipated under the Forest Practices Code. That isn't to say that each and every component of it has been anticipated, but in large measure, the review does anticipate the kinds of integrated resource management practices that are going to be required under the code. For that reason, we anticipate that it will have very little additional impact on future timber supply analyses.

The member is asking how that impact will be felt, to the extent that there is an impact. It would be felt through the further processes, because the timber supply review process is ongoing. There will be further analyses done once these ones are completed and the AACs established. The process will continue, and any significant changes in management practices will in time be incorporated into those further analyses. Some of those assumptions may help increase the cut assumptions, and some may have the opposite impact.

W. Hurd: The minister can surely see the concern here. I assume that the timber supply review is not an area-based analysis. It is based on timber supply areas, which are areas on a map. We run into an initiative such as this, but there are other activities, such as the protected areas strategy, the spotted owl recovery areas or the Forest Practices Code requirements, and I just can't rationalize it all in my mind. Wasn't the review strictly a process that involved taking the block on the map that was the timber supply area and then doing a standing inventory of every tree that existed within the boundaries of that TSA? Wasn't that the kind of exercise we were dealing with? Wouldn't setting an annual allowable harvest based on the timber supply review be somewhat flawed, given the fact that the government is now engaged in so many other initiatives? The minister has indicated, for example, that there may be as much as a 5 percent reduction in the overall annual allowable harvest in the province, based on the provisions of the code. That was a remark he made at the press conference.

That's just one initiative. The minister will be aware that in the Williams Lake TSA, for example, there was a complaint that the overall effect of the initiatives was to reduce the AAC by 40 percent. I'm seeking assurance that the information being compiled -- I assume at considerable expense, time and effort -- will be current and useful and will have built in the other initiatives that the government is involved in.

Hon. A. Petter: I understand that timber supply analysis is really a snapshot based on current assumptions of land base and management practices at a particular time. The overall analyses will be an additive process of all snapshots continuing over time as each analysis is done.

Many argue that the current assumptions are too conservative. Those in industry certainly argue that the assumptions about growth rates and practices can be improved. It's our view, expressed through the forest renewal plan, that that's the case. We can gain considerably by changing practices. Future timber supply analyses will therefore take into account changes that will produce 

[ Page 12067 ]

positive impacts on the timber supply that's available. Other actions may go in the opposite direction. Certainly the establishment of protected areas will remove some land from the forest land base.

Viewed in an historical context, the reason we're facing the possibility of AAC reductions in many areas of the province is that, compared with what may be the relatively small deviations the member is referring to, there were gross deviations in assumptions in the past. There was a failure to take account of the falldown affect -- the natural reduction in volume that occurs when one moves from original growth to second-growth stands; a failure to take account of the fact that management practices had changed and that integrated resource management was now expected; a failure to take into account that the public would not stand for management practices that didn't consider full resource values and protect streams and wildlife habitats. Previous analyses did not adequately take account of the changes that were expected, were occurring and are necessary in order to ensure healthy forests.

It has become apparent to me as I look at each analysis, that in many cases assumptions were made about operability in areas, which were far out of line with the existing reality. It may be that there will be expansions in the operable land base. In the past, areas that were thought inoperable became operable. As a result, the analyses will reflect those increases; it may be that some areas considered operable will become inoperable either due to changes in markets or as a result of things like the protected areas strategy.

The timber supply analyses try to look at the present and at the accurate situation now; let's take this snapshot now. Let's not make all these what-if assumptions; let's look at it now. Those analyses are then provided along with socioeconomic data, reaction and government policy to the chief forester, who then makes his determination.

[4:45]

In making his determination, he may take into account some community sense of whether or not improvements can be made. The actual analyses and results that are released are based upon the current practices and situations, because those are what everyone can agree upon; those are not controversial. What becomes controversial are the assumptions about where we'll go from here and what changes will be made.

W. Hurd: Perhaps I can ask a simple question. In the case of the Golden timber supply area, when the chief forester makes a determination, he says the current AAC of 650,000 cubic metres is not sustainable based on current management practices. In the discussion paper he indicates a decline over 70 years based on current management practices. When he makes that determination, can the minister tell us whether the chief forester is identifying a specific area for which he is making that determination? And if it's an area-based projection, is he factoring in those initiatives I talked about earlier, such as the protected areas strategy and the Forest Practices Code, which are going to have the effect of reducing the area base? If we're not dealing with an area base here, we're just dealing with figures on a map. I don't know how the chief forester can be expected to make those rather precise determinations without having an area base in which to make them.

Hon. A. Petter: Yes, the chief forester is looking at an area. He's looking at the area that he deems to be the operable forest land base available for harvesting within a timber supply area. In looking at that area he makes certain assumptions about the kinds of management practices that are currently practised and then about growth rates and yield rates. He arrives at a conclusion based on all these current assumptions about where we'll go. Some would say that approach is too conservative, because the operable land base from that area may in fact expand; what is not operable today may be operable tomorrow. Some may say that approach is not conservative enough, because there may be protected areas created within that land base in the future.

In fact, the chief forester doesn't take into account either of those eventualities in his timber supply analysis. They can become part of the consideration through the public feed-back and discussion that led to his AAC. But what the timber supply analysis provides us with is his determination, through his staff, of what a sustainable rate of harvest is in the long term, based on current management practices within the current area that he deems to be operable and available for timber harvesting.

W. Hurd: Some of these timber supply analyses obviously started before some of the initiatives were even announced by the current government. One of the challenges the minister acknowledges with the Forest Practices Code will be to determine how the regulations affect different regions of the province. Clearly areas of the province with more watersheds, for example, will experience a higher rate of protection or effect on the AAC than other areas. What I hear the minister saying is that the chief forester, who is charged with the responsibility of setting the annual allowable harvest in the province, is taking a snapshot of one of the 38 timber supply areas on a map and is setting a long-term sustainable harvest based on the inventory of trees that he's determined.

With respect to Forest Renewal B.C., are we going to see some recognition of the fact that there will be greater falldowns of some of these timber supply areas? Can the ministry at least make a commitment that in terms of the investment of funds, where the chief forester has identified a serious long-term decline...? It's gone from 650,000 metres to 309,000 metres in the Golden timber supply area where, according to figures supplied by the ministry, 1,100 current jobs and an additional 624 jobs depend on that existing annual allowable harvest. Is any effort going to be made on the part of Forest Renewal B.C. to identify where the most serious problems lie and to allocate resources based on those projections?

Hon. A. Petter: What Forest Renewal B.C. will look to, I assume, are areas of the province -- not necessarily just those, in gross terms, that have the greatest gap between the current AAC and the long-term sustainable yield, which is a prediction, not a determination.... The chief forester's AAC determination is quite different. It is just a snapshot to provide him with data upon which to make that determination. But what I assume Forest Renewal B.C. will do is look to those areas of the province where there are real opportunities to increase timber supply from what is assumed by current management practices. Hopefully, those opportunities will exist where there have been significant declines, but that may not be in some areas. Some of these declines may exist because some of the past assumptions about operability may have been, frankly, out of whack.

Forest Renewal B.C. will look to where it is most efficient to make investments with the concern, which the member is aware of and I share, that the investment program is regionally equitable. It will be a balance between those two. For example, some of the data out of the timber supply analysis demonstrates that there may be significant stands of 

[ Page 12068 ]

wood in some districts, so that if they were harvested sooner rather than later and regenerated, the soil could be capable of producing a much higher quality of wood than is currently being produced in those stands. That's an opportunity. Commercial thinning may provide some opportunities to enhance the value of wood supply. I expect Forest Renewal B.C. will look for those kinds of opportunities. It may be that there are opportunities to use wood that is not calculated right now because it isn't seen as merchantable -- deciduous stands, etc. The chief forester may take account of those opportunities in future calculations, as he did in Fort Nelson when he partitioned the cut in favour of an aspen opportunity.

There will be an effort by Forest Renewal B.C. to maximize the timber supply, based on the data that's disclosed in timber supply analyses and other research that will take place under the aegis and with the help of Forest Renewal B.C. They will try to improve management practices and maximize the capacity of the land base to produce timber in a way that doesn't compromise the ecological and environmental concerns that the public expects to be protected.

W. Hurd: Maybe I can try to simplify the discussion. The chief forester has indicated that, based on current practices, the annual allowable harvest in Golden is headed from 650,000 cubic metres to 309,000 cubic metres over the next seven years. We're currently harvesting in the range of 72 million to 75 million cubic metres in British Columbia. Where does the ministry see us in five years?

Hon. A. Petter: I'm not going to prejudge the chief forester's determinations, but I would refer the member to the information that the government released when it announced the forest renewal plan. It showed that unless changes are made in our approach and our practices, the timber supply over the next 20 years will decline from some 70 million cubic metres to some 50 million cubic metres.

Elsewhere it showed that through a program of investments over that period of time, we believe we can ensure that that level of decline does not occur now. Part of the problem is that we're dealing with a resource that is generated over 80- to 100-year cycles. Therefore the current pattern of decline, which was established by the practices put in place by previous governments, will not be reversible overnight. There are questions, therefore, about how we bridge from here to there. Those are questions that the chief forester will have to take into account in making his determinations on the extent to which declines will have to be made. In order to avoid long-term timber shortages, he's going to have to take into account not only the picture you've alluded to, which is based on current assumptions, but also what future practices are likely to be and what opportunities exist. I don't want to prejudge the chief forester, but clearly this government's view is that through the forest renewal plan we can -- through this kind of program of investment, which the member and his party oppose, but which we strongly support -- increase the timber supply so that the kinds of status quo pictures that are painted by the timber supply analysis in Golden will not be the reality. The reality will be a picture in which the timber supply, within areas like this, can in the future start to increase again and hopefully not only achieve the levels it had in the past but perhaps exceed those levels. That's going to take a major initiative of the kind that we have announced and are very proud of, which the industry supports, but the official opposition, in its ostrichlike mentality, opposes.

W. Hurd: Given the rather dramatic reductions in annual allowable harvest that are being suggested by the timber supply reviews throughout the province and given the crisis that he has acknowledged exists because of the practices of past administrations, I wonder if the minister can tell us how much of the $400 million he expects to spend through Forest Renewal B.C. on specific programs will mitigate the rather disastrous effects of a 50 percent reduction over 70 years in the Golden timber supply area, for example. If we were to spend the bulk of the $600 million that is being raised in additional stumpage revenues under Forest Renewal B.C. on the specific mitigation measures the minister talks about, we could somehow alleviate these rather draconian decreases in the annual allowable harvest and the reduction of jobs. Can he tell us specifically what he expects to be spent on the land base in order to deal with the kinds of cut reductions that are being proposed?

Hon. A. Petter: Last night the member recycled his decade-old speeches from his role as business representative for the Council of Forest Industries, and I told him at that time he was out of date. This afternoon the member is only a few weeks out of date, because he's raising the same questions now that he raised under the forest renewal plan, which I answered at that time. I would be happy to summarize briefly, but I'm not sure if it's useful to retread all that territory.

If you look at the documents released at the time of the forest renewal plan and reiterated in the debate we had at that time, you'll find that approximately half of the expenditures from that fund are anticipated to go directly back into land-based, forestry-related initiatives, which are directly geared to trying to maximize the volume and value of the timber resource in the future. An additional significant component goes to environment-related issues, which will also have a very positive impact on timber supply. I refer, for example, to efforts at watershed restoration, which will bring back into production lands that were lost due to poor road construction and slides.

Clearly the majority of funds that are being committed through Forest Renewal B.C. are dedicated toward investments in the land, and the environment envelopes have as a very major focus direct investment in expanding the forest land base and enhancing the volume and value of the forest resource. In addition, if you look at other elements of the program, those related to providing better skills and training for workers, much of that training will no doubt be directed at improved stewardship and skills necessary to bring about those changes.

The whole essence of the forest renewal plan is to address this very serious picture that has been painted for us by the accumulated neglect of previous governments. It involves working in cooperation with industry and virtually everyone in this province -- save the official opposition, who opposes this plan -- in trying to come to grips with what otherwise will be a very serious economic situation we will collectively face in years hence.

W. Hurd: Let me see if I have this straight. The timber supply review is conducting a snapshot of the 38 timber supply areas in the province. There doesn't appear to be any ability in the process to build in the Commission on Resources and Environment, the protected areas strategy, the effects of the Forest Practices Code, the spotted owl recovery areas and all these land base initiatives that the government is involved in.

[5:00]

[ Page 12069 ]

We've been advised by the minister that of the $600 million being raised in stumpage revenues, approximately $200 million is actually being spent on forestry techniques that have the demonstrated effects of mitigating these rather serious annual allowable harvest reductions. That's what I assume he's saying, because that's what we talked about in estimates, or at least during the debate on the bill. It defies credulity that this timber supply review is going to enable the chief forester to set any long-term goals, because we haven't established a land base. The timber supply review process apparently doesn't establish a land base, because in setting the annual allowable harvest -- for example, 309,000 cubic metres over 70 years, which is about a 50 percent reduction -- the other land base initiatives the government is involved in don't appear to be factored in at all. If we were dealing with a static piece of land and a standing inventory that was all available for harvesting, then I understand that we could take the funds from Forest Renewal B.C. and invest to the maximum degree.

Given everything else that's happening out there and the demands placed on ministry staff as a result of all these ongoing initiatives, I fail to see how the money being spent under Forest Renewal B.C. will be going where it should, which is on a defined land base for forestry projects that have demonstrated over time an increase in the annual allowable harvest.

The question I am going to ask is one we revisited in the chamber; I think it needs to be asked again. Does the forest renewal plan enable the government to adopt CORE and the protected areas strategy? Does it deal with the spotted owl recovery areas and the myriad of other land use initiatives that reduce the land base and harvest levels? Is it designed to take this snapshot from the chief forester in Golden, for example, and ensure that we don't go from 650,000 to 309,000 cubic metres? Is the purpose of the forest renewal plan to deal with the other initiatives or specifically with the findings and recommendations of the chief forester?

Hon. A. Petter: As is frequently the case, the member is very confused. I'll do my best to retread this ground, but having done so last night and on other occasions I'm not sure I'll be any more successful.

We face a range of challenges in this province. In the past, backward-thinking governments -- with the mind-set of the member -- didn't understand that societal expectations and situations were changing. They assumed everything was static, as the member said, and that the growth in operable land base would continue as it did in the past. They assumed that the volumes of original-growth timber would continually move to second growth. They assumed that everything would turn out, but they kept their heads in the sand, along with their assumptions. As a result of the report the member referred to earlier, we were collectively shaken out of our assumptions on finding out that we didn't have a timber supply analysis that gave us an accurate view of the real situation.

We have a number of challenges to face. We don't have an accurate picture of the timber supply out there and how much of it is operable. We have to ascertain the land base. While the member may wish to believe that stability will occur on its own even if government keeps its head buried in the sand, this has not happened.

In the last 20 years conflict has been emerging on the land base. It is becoming increasingly difficult for people to look to the land base for stability, but not because of CORE; to blame CORE is like blaming the doctor for the disease. The disease came about because public expectations changed around the land base. Assumed to be infinite, the land base clearly was not. As a result, conflicts emerged, and British Columbians wanted a process whereby the land base could be stabilized.

CORE is designed to come up with a planning process and resolution that will stabilize and establish the land base. If the member knows of some other way of establishing a land base, I would like him to share it with me. CORE is what British Columbians have yearned for. It has come to terms with the reality that the old assumptions about the land base no longer hold, and we need to work with British Columbians to come to a new stability so that land base areas will be set aside not only as parks but for forest production on which we can make the investments and be certain that there won't be these conflicts over land use in the future. We'll have a process that's relevant and speaks to British Columbians.

What is the forest renewal plan? Well, the forest renewal plan builds on both of those. The forest renewal plan looks at the information, the snapshot, that we have through the timber supply analysis, which is different -- and I caution the member -- from the AAC determination of the chief forester, who will take into account this snapshot....

W. Hurd: Not in here, it isn't.

Hon. A. Petter: Yes, it is. This is not an AAC determination. The Golden timber supply analysis is not an AAC determination. It is a projection of what will happen, in terms of timber supply, if we do not change our current management practices and assumptions. The chief forester will then make his determination based upon that snapshot and upon other information he receives from communities, in terms of the government's objectives and in terms of what he believes can be done to change those assumptions.

The forest renewal plan is an effort to ensure that we deal with some of the very disturbing signals sent by this snapshot and that we do it in conjunction with CORE. These initiatives work together. I know it's somewhat complex, but it is essential that we work together to establish a much clearer sense of what our land base is and how it is to be utilized, and to have the information about timber supply, growth and yield and what we can do through the timber supply analysis so that we can then make the investments through the forest renewal plan where they will produce the greatest returns. Through that process and other processes like the Forest Practices Code, we can achieve a sustainable rate of harvest that does not require us to tread down this staircase from current AACs to long-term sustainable AACs that are significantly below them. Rather, we can lift up that floor through the forest renewal plan.

The member, frankly, mischaracterizes what I said in response to his earlier question with respect to the investment. What I said was that many elements of the forest renewal plan -- the one relating to land, the one relating to the environment and the one relating to workers -- speak to the essence of the forest renewal plan: an investment strategy to try to increase the volume and value of our timber resource so we won't continue to tread down the staircase.

I understand that he's a little defensive about that, because he mistakenly -- I hope he can now agree and concede that; maybe he could stand up and tell us -- opposed the forest renewal plan. I can tell him that many in industry are very disturbed that the member and his party are so backward-thinking that they would come out and oppose the first plan that a government has come forward with in partnership with industry, with communities and 

[ Page 12070 ]

with others to try to deal with these problems. Perhaps he could use the opportunity this afternoon to recant and tell us that, in fact, it was a terrible mistake on his part.

These are initiatives that work together. Yes, we must achieve an established land base for forestry, and that's what CORE is all about....

[S. O'Neill in the chair.]

W. Hurd: You don't have a land base.

Hon. A. Petter: We do have a land base, but it is not a particularly stable land base, because we haven't had a land use planning process to make it so. You tell me, hon. member, how you would stabilize the land base and what your solution would be. This government has laid out its solution and is acting to increase the volume and value of wood on that land base as well.

The Chair: The member for Prince George North -- sorry, Prince George-Omineca. I apologize.

L. Fox: I certainly want to be recognized correctly. It's a different philosophical bent in that riding.

The discussion around the annual allowable cut and the setting of it was very interesting, and there are a number of issues I want to address with respect to that. The first issue, which certainly falls within what I think the opportunities are or could be under the forest renewal plan, is that we have to have a dedicated land base. If we're going to project an AAC that is sustainable, then we have to know what land base we're going to be working with, and we have to invest in that land base in a way that achieves the ultimate goal -- that is, to come up with a sustainable yield that will meet the social and economic needs of a community.

When we look at Sweden and the small land base that they work with, we see that they actually have a higher yield than what British Columbia has in terms of AAC. There are obviously opportunities, if we manage it correctly.

My preference would be to look at establishing a land base, and I wouldn't mind the minister's comments on this. This government has a lot vested in CORE, but I think CORE's whole approach is backwards. If we look back to the previous NDP government in 1972-73, when they established the ALR, which was a similar phenomenon, they placed land in the agricultural land reserve not just in the Fraser Valley region or the Peace region but all over the province. Some of it was not suitable for agriculture, but they dedicated a land base and immediately started working from that to deal with the other values.

It seems to me that we would be far better off if we took the approach of developing a forest land base and said that here are some parameters we believe have high values in terms of forests. We could then take a look at other sensitive areas. That's a proactive process for protecting the forests rather than a reactive process of seeing what everybody else wants and what we are going to have left. That seems to be very negative. It is not a positive approach from the forest industry standpoint.

Hon. A. Petter: If I thought that this were the approach -- the one characterized by the member as viewing the forest land base as some kind of residual of all other values -- I would be concerned. I can tell the member quite clearly that this is not the approach of this government, be it through CORE, through the LRMP processes going on in the province or through other land use planning processes.

The fact is that there has been a build-up of concern around other uses of the land base, and that has resulted in conflict. Part of those land use exercises have to deal with competing expectations about the land base, which was regarded more comfortably by British Columbians 30 or 40 years ago as a single-use land base. Because it is now seen in more finite terms, it is viewed as having to meet multiple needs.

The process through the LRMP or through CORE is to identify and secure the component of the land base that can best meet the future economic needs of our communities. It should be established for intensive forest use, integrated resource management or forest use subject to other constraints. As part of that larger land use planning process and to secure those portions of the land base, we also have to assure British Columbians that other values are being protected.

Some of those can be protected within that component of the working forest and others by preserving those areas as well, but it certainly isn't the view of this government or this minister that this makes the exercise one which treats the commercial forest land base as a residual of those other values -- far from it. There's a reality out there, and it is that those other values are out there and have to be grappled with. If they're not, then no matter how much we may wish otherwise, there will be conflict. That will serve no one's interest, and we have to resolve it. In doing so, we have to do it in a way that preserves and protects the commercial forest and the ability to stabilize and invest in that commercial forest for the future economic needs of our communities and our workers -- absolutely. Otherwise the exercise is not worth it.

[5:15]

That's why it is important to bring to those tables the groups, including industry, who can articulate those views. That's why government is represented through ministry staff in providing information. That's why the Forest Practices Code has within it a planning component to designate resource management zones. That is there to provide the same kind of security to the commercial forest as is provided to parks and wilderness areas now, through a mechanism that will designate a resource management zone for timber harvesting in accordance with certain management prescriptions. This is done through order-in-council, so it has the same kind of legislative imprint and status.

I know that some fear the scenario the member talks about. If I thought that the government were pursuing the kind of strategy he articulates, I would be concerned. Let me assure him that that is not the case. At the heart of our land use planning exercises is the determination to come to a common understanding about the economic base on which we can rely to invest in and produce the wealth we need in the future. The forest renewal plan will assist us so that communities and workers can have jobs, and we can have a healthy forest sector and forest industry for many years to come.

L. Fox: Those who are participating on the environmental side feel that the emphasis of government is on the forestry side in the CORE process. There hasn't been a clear statement by government that the emphasis of this CORE process is to protect the working forest. However, it seems far more evident that the government emphasis in the CORE process is to look at environmental values regarding the forest. The 12-percent-parks initiative has taken up a lot of time in the CORE process. So values other than forestry values are driving the agenda of the CORE process; that seems to be the concern. Each view of the CORE process 

[ Page 12071 ]

seems to have its own purposes. The working person who relies on the woods industry for his or her job has great difficulty understanding what the minister suggests is an emphasis on developing a working forest, that is sensitive to other values.

That's my perception; I think it's the perception of many British Columbians. If the minister is suggesting something different, then it should be a stronger directive. Government is hesitant to direct local round tables on what the values of the CORE processes should be. However, that's the concern of the working person. In my constituency, where CORE hasn't been a big issue, the local LRMP processes have worked extremely well. They have an emphasis on the working forest.

Hon. A. Petter: I don't see the CORE and LRMP processes as different. They're both part of this government's commitment to resolving land use conflicts and to producing stability and certainty. The LRMP processes are achieving considerable success. CORE was given the three most difficult areas of the province. They are difficult because the expectations and surrounding conflicts have produced some very intransigent positions in the past. The government felt that the best way to resolve those positions, which are highly polarized in some cases, was to bring people together in the community to come to a sense of stability.

I don't see the preservation of 12 percent of the land base as inconsistent; I see it as necessary in order to achieve the security of the working forest. If we don't make a commitment to preserve some significant ecological areas, then the conflicts will go on everywhere. Every valley will be in conflict. The domestic situation is most important. If we can satisfy those in rural and urban communities, who are concerned about environmental values, that we have struck the appropriate balance of both commercial forests, which is where the Forest Practices Code comes in, and protected areas, where the protected areas strategy comes in, then we can come out of this together with a sense of much greater harmony and social commitment. Instead of putting our energy into fighting each other over whether a park or forestry should be there, to maximize the economic values of that land base, we can put our energy into ensuring that the park is preserved as a park and the working forest is developed through initiatives like the forest renewal plan, which even the environmental community has said it can support. I understand what the member is saying, and in those very polarized situations in those three parts of the province it is very difficult to get people to put aside that conflict that has been building and building. For that reason, consensus was not achieved at the tables, and that's regrettable.

If we don't go through this exercise and involve communities, then I fear we're going to be in a far worse state. We have to try to seriously wrestle with these conflicts and come to some resolution that at least the majority of British Columbians and the majority within communities can accept. Rather than fighting each other, we can then get on with the job of working toward a common goal of maximizing the economic potential of the land base in total and securing the commercial forest in particular for its economic values and the jobs it produces.

L. Fox: I'm sure we could have this discussion for a long time and probably wouldn't come up with anything further, so I'll leave that at this point. I've tried to express my own and my constituents' feelings on that issue.

I want to talk a bit about the forest renewal plan. The minister should have received a letter dated June 2 from the village of Fort St. James, in which they articulate the concern of many small communities in the rural parts of the province over how they're going to share in the regional equity issue that's contained within the forest renewal plan. Fort St. James is probably unique, in that the forest industry is its number one industry, which it is totally dependent on. The volumes in Fort St. James are quite substantial. In fact, in the calendar year of 1993 the province collected approximately $50 million in revenue out of the Fort St. James forest district, between the quota wood and the small business portion.

Obviously they look at this renewal as a pretty exciting thing, provided that there is truly going to be equity. They're looking at the numbers and forecasting that around $80 million in revenue to the province in total stumpage will be coming out of Fort St. James in the first complete calendar year that this program is in effect. So they see themselves as perhaps being recipients of approximately $20 million through this forest renewal plan, if they were to get their fair share.

I don't know if that is an unreal expectation. I think the minister is well aware that the wood coming out of that district supplies a lot of the milling capacity in Prince George. Therefore the wood for many of the jobs that should have taken place in Fort St. James is going to keep jobs in Prince George.

There are certainly mixed feelings in the community about the volumes that leave that area. B.C. Rail alone makes one trip with 200 truckloads of logs into Prince George. They see that as their economy being moved out of their community. From the whole Prince George region -- the minister will recall I pointed this out -- comes 34 percent of the stumpage revenues of the province.

I have these questions. Have the regions and the number of regions been delineated in terms of how this regional equity is going to take place? Is the splitting up of the funds going to be, as I understand it, that two-thirds of the dollars go directly into forest renewal, silviculture, environmental concerns and those kinds of things -- I think your graph shows close to that -- and about one-third into educational initiatives? Could the minister tell me how that's going to be apportioned in those regions? Is it going to be consistent from region to region, or are there going to be some variations in that formula from region to region?

Hon. A. Petter: I appreciate the member's questions. I'm not sure I can advance things much beyond the discussion we had during debate of the bill. Now that the bill has been passed, we've been working to try to get the agency up and running and on what I hope we will soon be able to announce as the board for the agency. Certainly we hope to get at least some pilot projects established by the summer, but they will be largely pilot projects that will indicate the kinds of initiatives that the agency can build upon for the future.

With respect to regional equity, we talked a lot about that during debate on the legislation, and I'm not sure I can advance the discussion much further, except to say that our intention is that the funds that flow into Forest Renewal B.C. -- a projected average of about $400 million a year -- will be distributed in a way that is sensitive to some of the regional concerns the member talks about. I can't promise him exact numbers for the village of Fort St. James or other areas.

In terms of the envelopes, certainly the majority of the funds will be committed to investment in the forest values and environmental values of the land -- some of the latter 

[ Page 12072 ]

will actually enhance forest values, for reasons I gave earlier -- with other components going to communities to assist in value-added production in skills and training.

I think I indicated in debate on the forest renewal plan that I don't anticipate that each of those subenvelopes or the initiatives that may emerge under them will necessarily be distributed equitably on an individual basis. The equitability will be achieved across the whole program. The reason for that is obvious: the investment should take place where it can realize the greatest return. An investment in, for example -- I've used this example before, but I'm not sure at this hour of the day I could come up with a new one -- bringing marginal agricultural lands into forest production would be relevant in the Prince George or Dawson Creek region of the province, but less so on Vancouver Island. To the extent that there would be an initiative to help get timber production on those kinds of lands, it wouldn't make sense to devote that to areas equitably. So the agency will be trying to achieve equitability in its total portfolio of investments.

There has been no predetermination of what the regions will be. I indicated in debate that I didn't want to prejudge how communities will want to be represented, what voice they will have and how they might see their regional interests. A subcommittee established through the legislation will deal with communities' concerns, and each of them is charged with the task of recommending on regional goals. Through that process I anticipate that a program will be achieved that will speak to all regions of the province on an equitable basis. The member should be relieved that I don't have any predetermined notion about how that will occur. I think it's going to have to occur through the activities of the board interacting with communities, such as the village of Fort St. James, and working on a sensible program of investments that will achieve equitability overall and will also maximize the return in terms of jobs and increased timber supply across the province.

L. Fox: Well, it wasn't my intent to revisit the bill. I was just hoping that we had advanced sufficiently in terms of some of those things that I could allay some of the fears of the municipalities within my constituency.

[5:30]

Just to follow up on that, there was a TSA review of the Prince George region. The Prince George TSA has been ongoing for about -- or promised to those communities.... It started, I believe, in 1991 or 1992. The Prince George TSA, as the minister will know, is very large in terms of geographic size, the number of communities within it and also the number of licensees within it.

There's often a very difficult time with any kind of TSA plan that has agreement of the licence holders because of the number of them that are in the TSA as well as because of the different qualities in stands of timber in different parts of the TSA. It makes it very difficult for the licensees to agree with a TSA plan.

Through five of the eight years that I was mayor of Vanderhoof, we constantly petitioned the ministry to look at developing three TSAs within the Prince George TSA: one for the Fort St. James region, one for block D, which includes Vanderhoof and Fraser Lake, and one for the Prince George area. We had, as municipalities, been promised -- in fact told -- that a review would be started in 1992, but I've never heard anything about it since. The communities want to know whether or not there is a review taking place and what its status is.

Hon. A. Petter: The timber supply area is obviously a large one. Yes, work has been going on. The data is being compiled for the initial timber supply analysis report, which will be the first of three reports released under the timber supply review. I'm informed by staff that that report will likely be available mid- to late August. Then there will be two subsequent reports. One will look at the socioeconomic analysis, and one will be a public discussion paper to invite the involvement of the general public, who can't necessarily relate to some of the more technical data.

As I'm also informed by staff, we're aware of the concern that because of its size, there should be some sensitivity to various subcomponents of the TSA. I understand the analysis that will be provided will lend itself to some breakdowns of that kind. Beyond that, this kind of analysis will provide the basis for exploring ways in which that unit might be broken down and lend itself to better management -- one that can look in a more detailed and effective way at the various components rather than looking at the whole.

The first step will be the overall timber supply analysis. That will not only lead to the timber supply review but will also provide a basis for discussing how we might manage that large timber supply area in a way that would be more effective. The member has indicated that some in the area believe it ought to be more effectively managed.

L. Fox: I appreciate the minister's response. I'm sure it will be good news to the communities. The smaller communities within that TSA are looking to protect their economic base and so on. The minister will be told, if he's not already aware, that the licence holders in the Prince George region are concerned about splitting up the TSA for various reasons.

I just want to ask some questions around the reorganization that's taking place. I made one phone call to the forest district because of concerns expressed by some of my constituents who were not totally aware of what was going on. To my surprise, the next day the minister tapped me on the shoulder and said: "I hear you're investigating the reorganization." He's obviously got a very good pipeline.

[G. Brewin in the chair.]

I know about the broad initiative, but I understand that there are two reorganizations happening. One involves moving some of the people out of Victoria into the regions, and the other is the one I'm particularly interested in: the reorganization in the protection division of the Forests ministry. Would the minister give us a broad outline of those two initiatives?

Hon. A. Petter: I spoke earlier about the general ministry reorganization that resulted from the Spalding report. The general purpose of that reorganization is to shift resources where they are most needed, closer to the field, reflecting the wishes of staff who feel they have been burdened by inadequate administrative structures and prevented from doing the job they would like to do. What we envisage over the next two years is a reallocation of about 200 from headquarters and regional offices into district offices, and we plan to streamline the activities at headquarters and regional offices so that staff there can do a more effective job with reduced numbers and we can have more field staff out in the districts. The districts will be the major beneficiaries in terms of increased staff, and that will enhance our ability to monitor and work under the Forest Practices Code. It's quite a major undertaking and a challenging one, and obviously it's of concern to staff, as any change is.

[ Page 12073 ]

I've had an opportunity to meet with staff around the province, and my deputy has been very active in this regard. I believe there's a common sense of purpose within the ministry to get this right and to work together through some of the dislocations. As I said to the member for Surrey-White Rock, the report that triggered this was to some extent based on interviews with staff, and we were trying to get a sense of staff's own reading. In that sense it was an attempt to come to a structure that would best facilitate the job staff want to do, not to impose one. So that is the ministry reorganization in very general terms.

On the more particular question about protection, I can tell the member that one of the reasons I was aware of his concern is because his leader lobbied me to make sure that one of the new protection centres would be located in Chetwynd, a community in his constituency. Prior to that, I had been aware of the member making some inquiries. So I responded by saying that I'd be happy to follow up on that. It was confirmed that this member had been making some inquiries, so I came back and said: "I'm pleased to tell you that Chetwynd is being looked at right now. Can you assure me that this means you're now fully on board and supporting the protection reorganization?" I know that doesn't necessarily follow, but that's the sequence. I thought it was kind of amusing, because I heard of the concern and the request both within the space of a day or so.

The effort at reorganizing the protection program is an attempt to gain some efficiencies within the program while recognizing that this has been an incredibly successful program. It is recognized internationally as a world-class program. Certainly we do not want to compromise the program in any way. But the feeling is that by bringing the program into a different arrangement in which there would be fewer centres that would coordinate the protection activity while still leaving some resources in the districts, we can gain efficiencies without compromising the valuable elements of the program. I think the analogy you might use is the provincial Ambulance Service, the 9-1-1 service, in which -- you may not have it -- by having a more regionally focused approach to protection you can gain some efficiencies. Clearly those efficiencies cannot be gained at the expense of sensitivity to a local condition. We believe that the program we have in place will achieve that.

The elements of the program, quite simply, are that the ministry plans to reduce the number of fire control centres from 50 to seven in order to increase efficiency and reduce duplication. There will still be a protection staff member left in each district to ensure that the local tie-in is maintained. Over 20,000 forest fires were analyzed to predict the pattern of frequency of fires as part of the planning that went into the program, and that is ongoing to locate those seven centres. The consolidation of fire control centres, as I said, follows a sort of B.C. Ambulance Service model, and we've looked at other jurisdictions, such as Alberta and Ontario, where similar initiatives have been quite successful. Again, it's being done in conjunction with the ministry.

Whenever you have a successful program -- albeit one that may not be as efficient as it could be -- one wants to tread very carefully, and I believe we are. The intention is to maximize the benefits and efficiencies through this consolidation in regional centres while maintaining as much as possible the local sensitivity that exists. So that, in general terms, is the direction in which we're going.

L. Fox: I guess one of the largest sectors that seems to be extremely concerned in Vanderhoof, at least, is the agricultural community. They've worked very well with the Ministry of Forests, and they have controlled brush fires and met emergencies. One of the big pluses in the old system was that the local individuals knew where all the equipment was and where the logging was. If Henry around the corner had a cat, they were aware of that kind of stuff, and they were able to respond extremely quickly and efficiently.

I know that we always need to look for efficiencies in government and especially in services such as that. But I'm of the old school where I kind of believe that if the system works and works well, and it's not broke, why are we trying to fix it? I'm obviously extremely concerned, because in our region we have probably one of the best success stories in the province. Even though the service has been extremely good throughout the province, I think we've had one of the better success stories in the province in terms of fire response and fighting.

[5:45]

I would hope that we give it very serious consideration before we see the other system disbanded. It would be nice to see us go through this process slowly. The minister talked about some pilots in forest renewal. It would be nice to have similar programs in this new initiative, in perhaps one part of the province or another, to see how it works. I don't want to see us lose any volume of that wood, which is so sacred to the economy in my constituency.

Hon. A. Petter: I certainly share that concern, and I'm sure the member can appreciate that the ministry shares that concern. We don't want to compromise the reputation that we have established. In fact, we want to enhance that reputation on two fronts: in terms of service delivery and also on the efficiency side.

Basically, I could talk about what this program is about in terms that at least make sense to me and hopefully to the member. What we're doing is moving the service closer to the problem. District offices are administratively located for a range of reasons, and those reasons don't necessarily relate to where the highest incidence of fire occurs in the province. While we have coverage because of the number of existing district offices that cover the province, what we're going to do through this initiative is take those resources and redeploy them to some extent. We will focus them where the problems actually exist, and that's why there has been so much work done to identify where the really sensitive areas are.

As I mentioned, there will be six coordination centres and 17 attack centres. Each of those attack centres will be no more than half an hour away in terms of ability to deliver fire protection services, if necessary. We anticipate that the service will be no worse as a result, and in many cases, it will be better than is currently the case.

Because of this pooling of resources and locating the resources closer to where fire incidents occur, there can be tremendous efficiencies gained beyond the existing duplication of services and equipment. By coordinating this better, we can ensure that we get maximum and best use out of the equipment that's available, and we can use those resources to make sure we have the best possible equipment. Rather than duplicating equipment, we can make sure that the equipment we have is state of the art and the best possible.

Having said that, neither I nor the ministry disagrees with the member that it's important to have a local presence as well as the kind of knowledge the member talks about -- the intimate knowledge of local conditions within districts and of where equipment within those districts is available. For that reason, there will be a dedicated fire protection staff 

[ Page 12074 ]

member maintained in each district. The recognition is there, and that capacity is there as well.

The ministry staff has been working on this for some time, and we're confident that what we will gain as a result is a more efficient and effective service, that will not sacrifice local sensitivity but will gain in efficiencies. It will also provide us with a greater capacity to deal with the problem the member talks about -- putting out fires that can eliminate a substantial component of our resource base if we don't have that basic capacity.

L. Fox: So that I understand, I need just a couple of points clarified. What protection staff would a typical district office have at the present time? We could use the Vanderhoof one as an example. You say you're leaving one member there, but how many do they have at present?

Hon. A. Petter: I'm informed that each district has one fire control centre and, depending on the incidence of fire within the district, two to five staff. It's in that range.

L. Fox: I'm looking at this whole reorganization structure and at the physical plant in particular now. I had the privilege of sitting on a BCBC board for four years, and it always used to amaze me that we built a number of forestry buildings throughout the province. We no sooner got them built than they were too small, and there were trailers outside. Has there been any analysis done on what the physical plant changes being caused by this reorganization are going to cost throughout British Columbia?

Hon. A. Petter: I don't have the numbers at my fingertips, if the member is looking for numbers. I'm informed that every effort is going to be made to minimize any incremental costs by using services and facilities that are available within the area in which these attack bases will be located. Maybe that's why Chetwynd is being looked at, given that it was the site of a suboffice within that district. So there will be efforts to minimize. I'm also informed that while there will be some incremental costs from these relocations -- capital costs -- the overall net saving in the work that's being done will more than offset those costs.

L. Fox: Then am I to conclude from that statement that the bulk of the work for the 200 people who are moving out into the districts is in the districts and that there are a lot of travel costs and so on associated with their jobs? Is that how the efficiencies are going to be...? I have some problems understanding how we're going to gain these efficiencies by moving these people out into the districts.

Hon. A. Petter: There are a number of ways in which savings will be realized. One is in terms of staff resources. The current model doesn't have the same kind of dedicated, regionally based staff component. Therefore there will be efficiencies when shifting around FTEs or staff and having to draw in FTEs, depending on fire incidence. Some equipment and seasonal fire staff are going to be relocated to attack bases, but this should mean that they'll be more efficiently deployed.

The information I have is that depending on the severity of the fire season, savings of approximately $6 million in firefighting costs could be realized. Those assume staffing costs and overtime. It's anticipated this should improve our firefighting capacity. An independent analysis by the University of Toronto concluded that 450,000 cubic metres of wood will be saved as a result of this reconfiguration, which equates to $80 million in shipment value. There are a number of ways, both in terms of the better protection provided to the resource by the redeployment and more efficient use of equipment and in the redeployment of personnel and dedicated personnel, that efficiencies will result in cost savings and better services as a result of this reorganization.

L. Fox: I can understand how there are efficiencies in the protection division. Perhaps the minister misunderstood me. It was the overall reorganization I was concerned about. I could see us moving 200 people -- that was the number the minister gave me -- from Victoria out into the districts. When we go around the province now and look at the existing district forest offices, almost without exception, even at the newest ones, there are trailers housing employees. Has any analysis been done in terms of the costs for making available office space to accommodate the 200 employees that are going to be moved out into the districts?

Hon. A. Petter: The answers are never as simple as one would hope. I'm informed that relocating 200 people over a period of two years into district offices will have implications on the kinds of facilities required. I apologize for not having glommed on earlier to the member's intent; I was still focused on protection. Those additional costs are being examined.

In the shift of personnel from district offices to these regional fire centres, it is hoped that some of the warehousing no longer required at the district office level may provide space that can be converted, in the case of warehouses, or utilized, in the case of staffing, to relocate some of these personnel.

One reorganization will complement the other. There will be some additional capital costs to a very good cause: providing the districts with the personnel they need to do an adequate job in processing planning permits in a timely way and ensuring that cutting and planning occurs in a manner that's consistent with legislation.

L. Fox: I could anticipate part of that answer, given that moving perhaps three of the five people out of their respective offices would alleviate some of the problems.

I hope the review is as positive as the minister suggests. When I am out in the rural parts of the province, my experience is that moving two or three people out of an office wouldn't really alleviate the trailer situation which presently exists, so irrespective of that there's going to be a lot of pressure on the ministry. Given that a lot of these buildings aren't owned by the ministry or even BCBC -- they're acquired on a bid proposal basis -- in some cases the difficulties in achieving the extra space aren't going to be as simple as we envision, but that's fine.

I think I'll take my place at this point and allow the official opposition.... I'd be glad to get back into the debate at a later date.

W. Hurd: I would like to return briefly to the timber supply review and apologize for the member of staff who is bouncing back and forth from the gallery to the....

Going back to 1991 and the report referred to previously, one significant recommendation was that the Forest Service should actively redefine the sustained-yield unit. I wonder what progress had been made. First, I will ask the minister what his vision of a sustained-yield unit would be and whether it would be area-based.

[6:00]

[ Page 12075 ]

Hon. A. Petter: Clearly one must determine sustained yield based on area. It doesn't make sense to suggest that one would define sustained yield independent of an understanding of the land base available for harvesting; hence the discussion we had earlier about the desirability of having a defined land base. So yes, that is the case.

Regarding the reference the member makes, my best information is on the concern that in some parts of the province the existing timber supply areas may be larger than desirable in order to accurately and effectively determine the sustained yield and to undertake strategies to maximize the timber values within the area. The approach we're taking, however, is to try to get that baseline information together before we proceed to make the administrative changes or strategies that might flow from that information.

Hence my answer to the previous question about the Prince George region is that once we have the timber supply analysis in hand, we can look at possible strategies that might enable us to better manage that timber supply area, and subcomponents of it, in a way that is more responsive to its particular conditions. The concern referenced by the member is noted. We're moving to get the database that will enable us to consider further changes that can move us in the direction we wish to go.

W. Hurd: I assume that sustained-yield units refer to units in which no more trees are being harvested than are being replaced with new growth so that there's a balance in perpetuity. I wonder if the minister can tell us whether his ministry is aware of how many forest licences, particularly tree farm licences, currently have that sustained-yield status. How many are in balance in terms of the amount being harvested and planted for long-term sustainability? Is that an investment in time and resources that the ministry makes on an ongoing basis?

Hon. A. Petter: I have difficulty in answering the member's question. I think the way he's approaching the notion of sustainability or sustained-yield unit, which is not a term utilized these days, is different than the way in which the chief forester would approach it. He seems to have a conception that sustained yield means an even flow of timber. That is not the case. A sustained-yield unit is simply a management unit; within that management unit one seeks to manage the timber to ensure that there is sustainability over time. That doesn't mean the flow is necessarily even.

Indeed, the chief forester has gone to great pains to point out that in a transition period, as you move from original growth to second growth, you will necessarily have a variable flow. A forest renewal plan that's going to make major investments and increase the volume and value of timber may affect the flow. Maybe it's because the member didn't understand that he voted against the renewal plan. Maybe now he understands that one can achieve sustainability on an upward curve if one makes the investments. He and his party will reverse their very backward view of sustainability and come on board with a plan that is aimed at achieving sustainability without requiring an even or downward flow.

I can best answer by saying that the member's definition about sustained yield is simply not in accordance with the practices of the ministry or with sustainability as defined by anyone I know.

W. Hurd: One of the recommendations in the government's report in 1991 was that the Forest Service should, in fact, redefine sustained-yield units. I assume that recommendation was made. I'm pursuing with the minister what version of sustained yield unit he holds to. Clearly the ministry recognized the need to not only....

Hon. A. Petter: You define it.

W. Hurd: I've defined it. No more trees are being planted or harvested than are being replaced by new growth. It's a term that has existed, I know, on tree farms in the province for years, and that's the reason I asked the minister whether his ministry has done an analysis or received information on the forest licences in the province to determine how many of them are occupying that kind of sustained-yield unit status. And he's saying that even though his ministry suggested that the term be somehow redefined in 1991, the term has no meaning today. Is that what I'm hearing?

Hon. A. Petter: A sustained-yield unit is a management unit; it's a geographic unit in which one manages. To redefine sustained-yield units means to redesignate the geographic areas, and that's why I answered the member's question the way I did. The member's question related to redefining sustained-yield units. There are some units, now referred to as timber supply areas -- Prince George would be one example -- in which there has been some concern that the unit is too large and therefore needs to be redefined. The term "sustained-yield unit" -- not much used these days -- refers to the management area. It doesn't refer to some misplaced principle of a flat rate of harvest over time; it refers to a management unit.

W. Hurd: I can see why we're getting into the problems we have in British Columbia, because sustained yield, in the mind of the minister...

Hon. A. Petter: Sustained-yield unit.

W. Hurd: ...is being totally interpreted by the ministry. Let's shorten it: sustained yield. That means that the yield off the land is sustained over time. Is that not a fair assessment of sustained yield? Or is he just saying that we're sustaining a yield, and the yield may be whatever?

Hon. A. Petter: I prefer to change the question.

W. Hurd: Well, perhaps then I can ask: from the same...?

Hon. A. Petter: Read the whole quote.

W. Hurd: "The Forest Service should redefine sustained-yield units...."

Hon. A. Petter: That's right. The geographic areas in which we manage.

W. Hurd: Well, I mean....

The Chair: Hon. members, I've let a certain amount of this byplay happen, and each member who is speaking has been able to incorporate language around that. It's getting more complicated. One at a time, please.

W. Hurd: Thank you for that direction, hon. Chair. I want to categorically assure the minister that the term "sustained-yield unit" does exist. It's area-based. That's probably the reason we aren't getting anywhere in this discussion, because area-based tenure and sustained yield, I think, are 

[ Page 12076 ]

terms that go hand in hand -- along with inopportune votes in the House.

The Chair: Saved by the bell?

Hon. A. Petter: Just to close off this misguided line of questioning and comments, the member can try to shift the issue now to what sustained yield means, and that's fine. We can have a debate about that. If he's talking about sustained-yield units -- which he is now, I think, coming around to acknowledging -- it refers to an area. It's a unit in which you try to achieve a sustained yield. When the report referred to redefining those, it meant redefining the areas. It meant to take areas currently defined and redefine their boundaries so as to maximize the efficiency of the exercise and facilitate proper management. That's what the reference he alluded to meant.

The Chair: Hon. members, we will recess while we go to vote and then return and resume our discussions.

The committee recessed at 6:09 p.m.

The committee resumed at 6:10 p.m.

Hon. A. Petter: I move the committee rise, report considerable progress and ask leave to sit again.

Motion approved.

The committee rose at 6:11 p.m.

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