1994 Legislative Session: 3rd Session, 35th Parliament
HANSARD
The following electronic version is for informational purposes only.
The printed version remains the official version.
(Hansard)
FRIDAY, JUNE 17, 1994
Morning Sitting
Volume 16, Number 15
[ Page 12077 ]
The House met at 10:03 a.m.
Prayers.
K. Jones: Visiting with us today is a group of approximately 30 grade 3 students from Walnut Road Elementary School in my riding of Surrey-Cloverdale. Their teacher, Rita Shaw, and several parents are accompanying them. I'd ask the House to extend a warm welcome to them. I hope they have a great and enjoyable time here in beautiful Victoria.
The Speaker: Hon. members, before we proceed with orders of the day, I'd just like to make a statement on a matter which I'm sure will be of interest to the assembly.
You will recall and be aware that the position of parliamentary secretary is a relatively new one in our jurisdiction, and it appears that the role of parliamentary secretaries, in relation to their status during question period, has never been addressed by previous Speakers in this House. No considered opinion has been expressed in this regard, as a result of a point of order having been raised or otherwise. However, it has been brought to the attention of the Chair that on many past occasions questions have been directed by parliamentary secretaries to cabinet ministers, and accordingly, it may be fairly concluded that the practice of the House in this regard has thereby been established.
Accordingly, it is the intention of the Chair to recognize this practice, notwithstanding that in other jurisdictions parliamentary secretaries are not permitted to ask questions of their own ministers. The issues involved here have been well canvassed in two rulings: one in Saskatchewan by Mr. Speaker Tusa, Saskatchewan Journals, August 6, 1987; and the other by Mr. Speaker Jerome, Ottawa Journals, November 5, 1974, page 1059.
As your Speaker, I feel duty-bound to follow the established practices of this House. If practices respecting House procedure are to be altered or revised, it is obvious to me that this should be at the initiative of the House itself. My statement in this connection, made on Wednesday last, was an error, and the Chair offers its apology to all members.
On another matter, last Wednesday the hon. member for West Vancouver-Garibaldi sought to move adjournment of the House under standing order 35 to discuss a matter of urgent public importance: namely, the riot which occurred in Vancouver after the final game of the Stanley Cup play-offs. While the matter raised by the member is indeed a serious one, prior to the member raising the matter the Attorney General stated to the House that the Police Commission had been requested to undertake an inquiry into the matter, which would come under the normal administrative responsibility of that ministry.
I am of the view that standing order 35 was never intended to provide a vehicle for interference in the normal administration of justice, and for these reasons theapplication cannot proceed.
W. Hurd: I ask leave for an introduction.
Leave granted.
W. Hurd: It has come to my attention that a group of 45 students from Jessie Lee Elementary School in my riding are visiting today. They are accompanied by their teacher, Ms. Bergstrand. Would the House give them a warm welcome.
FORT ST. JOHN: CELEBRATING 200 YEARS OF HISTORY
R. Neufeld: I make use of every possible opportunity to brag about the constituency of Peace River North. In fact, in 1992, when we celebrated the fiftieth anniversary of the Alaska Highway's construction, I made a point of boasting how successful that project was. So I couldn't pass up the chance to speak today about the significance of 1994 to the city of Fort St. John.
Some might think of Fort St. John as a frontier town which only thaws out twice a year. But if you look past the stereotypical images you may have, you'll find a region in which residents experience all four seasons; a region which contributes millions of dollars to the economy of British Columbia and is rich in history and culture. In fact, Fort St. John lays claim to the title of the oldest European settlement on mainland British Columbia. We are also proud of our other claims to fame: we are the Land of the New Totems and the Energy Capital of British Columbia. This year marks the 200th anniversary of the establishment of Fort St. John. It's a time for the residents in Fort St. John to celebrate the role we played in the development of British Columbia and a time for us to boast about it.
By way of introduction to our history, I'll quickly take you back 10,500 years -- but don't worry, I'll give you an abridged version. In the Charlie Lake Caves just outside of Fort St. John, archaeologists discovered artifacts dating back 10,500 years. The stone bead found in that exploration is the earliest evidence of human adornment in all of North America. These findings are further evidence that paleoaboriginals crossed from Asia to North America by way of the Bering Strait at a time when the two continents were joined by a land bridge.
In 1793 Alexander Mackenzie was the first explorer from the European community to lay eyes on the Peace River area. Just one year later, in 1794, Fort St. John was originally established as Rocky Mountain Fort, which was constructed on the Peace River at the mouth of the Moberly. As a result of this settlement, Fort St. John has the distinction of being the oldest mainland settlement in all of British Columbia. This first location served as a trading post for the Beaver and Sekani first nations and as a supply depot for those venturing further into British Columbia. Fort St. John was located at a number of different sites, six in all. This is not to say that the citizens couldn't make up their minds, but the change of locations was needed to adapt to the changing needs of the growing community.
Our heritage, which commenced with the aboriginals coming through the ice-free corridor, continued to grow through the era when the large trading companies settled in the Fort St. John area. Fort St. John itself, however, really started to grow over the last 100 years. Hundreds of impoverished prairie farmers were driven westward to the well-known fertile lands of the Peace River area through the late twenties and thirties. With the completion of the Alaska Highway and more than 1,500 miles of roadway in 1942, Fort St. John's population ballooned to approximately 2,000. That year, however, Fort St. John experienced a great loss; its population fell to approximately 700 when the American military personnel left. Less than a decade later, mind you, the discovery of oil in Fort St. John revitalized the town. It was a gathering point for thousands who sought out
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livelihoods in mining, trapping, farming, forestry and the oil industry.
The Peace-Liard region now boasts of nearly 90 percent of B.C.'s cereal grain and seed crops and almost one-third of all forage crops. The explorations for oil and natural gas which began in the 1920s were so successful that the first oil well in the entire province was brought in near Fort St. John in 1951. Today our area continues to reign as British Columbia's petroleum industry capital. Those of us living in northern British Columbia recognize the importance of viable, prosperous industries in providing jobs and an opportunity to live in the north.
Our 200th anniversary, Fort St. John's bicentennial, is a time for us to reflect on our historical developments. We also must recognize why Fort St. John became such a prosperous community, because even more important that the industries themselves are the people who built Fort St. John. Women, men and children with very few possessions but many dreams came to our region. They lived in makeshift shacks and tents throughout the year, as they remained dedicated to clearing their land and growing their crops. Many others turned to businesses and established stores which provided daily necessities and a meeting place for the residents. Simply put, it's the people who make a town successful.
[10:15]
This is why I encourage each of you to visit Fort St. John during our bicentennial year of celebrations. Drop by for beans and bannock dinner, to watch a parade, to visit the first nations historical display at the Fort St. John museum or the international air show on July 16 and 17 of this year, and experience true northern hospitality. I hope that I've piqued your interest in Fort St. John and maybe even in the rest of northern British Columbia and that you will make an effort to visit this year.
L. Boone: As the member for -- well, maybe not the closest; my colleague from Prince George North is now closer to this constituency -- one of the closer constituencies to the Fort St. John region, it is certainly my pleasure to stand here and add congratulations to Fort St. John on its 200th anniversary. I've been to Fort St. John on numerous occasions. I haven't watched it develop from a fur trading area -- probably my colleague across the way did -- but I do know it has a history of fur trade. We've seen the farmers and certainly the oil come into the Peace area. We've watched the fortunes of Fort St. John grow as the oil industry grew. In my years in the north, from 1969 on, I know there have been times when Fort St. John has been a booming, thriving community -- one where you couldn't get a hotel room at various times because of the oil industry there. Then in other years, it's gone down into severe depressions because the oil industry has been in a depressed period.
Now it's booming, and I'm glad to see that. I'm certainly happy to see all of the people in that area doing well, because it's a community that really does deserve to do well. As northerners, hon. Speaker -- and you and my colleagues have heard me talk about this -- we have a unique people who dare to take a chance, to move someplace else, to have a frontier attitude, and those that live in Fort St. John certainly have that attitude. As the member said earlier, they have taken a chance to come into that region and develop roots there.
I've also heard visitors say that the further north you go, the friendlier people get. I know that when I talk about being north, people often say -- and the members for Peace River South and North have told me -- that I'm not north, living in Prince George. We are in fact the centre of B.C., that's true. But the further north you go, you do get friendlier. And even though the member who has been speaking is a member of the Reform Party, I can attest to his friendliness and the fact that he is always a joy to deal with in this House.
So my congratulations to Fort St. John and all the residents there on their 200th anniversary. I too would encourage people to go to the north. Those B.C. highways do travel both ways; they do come north, and we like to see people come there. And when you're going on the highway to Fort St. John, of course, you come through Prince George, which is the centre of B.C. We're very happy to see you come through our community there. Congratulations to everybody on their 200th anniversary.
The Speaker: The member for Peace River North concludes.
R. Neufeld: First off, I'd like to thank my colleague from Prince George-Mount Robson for those kind words. I'm sure the people in Fort St. John will appreciate that very much.
I would like to thank the North Peace Historical Society and our museum curator, Donna Kyllo, for their dedication to preserving our proud history. In fact, the North Peace Historical Society holds the title to the property of the old Fort St. John site on the banks of the Peace River, which was occupied from 1872 to 1925. I congratulate the society for their plans to develop this site into a park area for all residents and tourists to enjoy. As well, Finola Finlay, principal of Northern Lights College in Fort St. John, deserves a great deal of our gratitude for her work as an archaeologist who has participated in many digs near Fort St. John and as an author, because she has brought life to our history and culture.
I encourage all MLAs -- some of whom probably haven't ventured to the northern part of British Columbia -- to visit us this summer for some true northern hospitality. You'll probably even decide to return for another vacation.
COMMUNITY PARTNERSHIPS
D. Streifel: I'm rising this morning to speak on something I believe is very unique in my community, and it's something that should occur in communities all across this province and country. It has to do with community partnerships and how to get the job done when something seems to have fallen off the tracks.
Several years ago the community of Mission, with the school board and some community activists, began planning what would come to be known as a joint project. A joint project has nothing to do with a flashback to the seventies, hon. Speaker. In fact, it's a very interesting four-way partnership that developed in the community around a university college campus; a new high school, which would be a third secondary school for Mission; a performing arts theatre; and a community gym space, along with meeting spaces for the community.
What was important about it, and what's really different, is that our community recognized several years ago that governments can't do everything; we just don't have a big enough chequing account to buy everything we need. So the district of Mission decided that they would fund the gym space and community space on the college and school sites. We needed that in the community, anyway, and there were plans to build it. So they decided it could be part of this project.
Mission is a very artsy community. We have a folk festival, there is a powwow every year, and there are lots of
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artisans and home-based businesses -- very community-oriented folks like that. We don't have a venue to display some of our talents in Mission. The community decided they wanted a performing arts theatre. They also decided that there should be minimal financial government input into this theatre. It would be their project, they would take it on; and they have. As a community, they have raised a $500,000 donation from one family, with the intention of raising another $2 million or $3 million to build this theatre as Mission's project. This would be the linchpin within the university college campus and the third secondary school.
This year the whole process fell off track when we didn't get capital funding out of the K-to-12 budget. But very typically of Mission, the community didn't do anything but get angry. They then dug a trench and decided to fight for what was theirs and for what they believed was the right thing to do. They didn't walk away from their project. They didn't throw up their hands and say: "Oh, woe is me." They decided that this was well worth fighting for -- and fight they did. They had scads of letters and a great public meeting. I was with them at the public meeting, and I was onside with the community through the whole process. We found a way to reward community partnerships and community cooperation that would bring forward initiatives -- some of them government initiatives and a lot of them community initiatives -- in a project that will sparkle in British Columbia and be an example for other communities to follow.
The planning of this project is complete, the land acquisition is more or less complete -- one or two little hurdles to climb, but they'll be climbed as well -- and we have a $500,000 donation and $800,000 from the local community for the gym space. As well, the University College of the Fraser Valley rearranged their capital priorities to partnership within this program. With that cooperation, we were able to find the means to fund this project this year -- a project that's being built in layers, not in separated sections as most projects are.
Imagine a third secondary school, a performing arts theatre, a university college campus and a community gym space and meeting space, not being built in separation or segregation and one block at a time, but being built in cooperative layers, where one cooperates, linchpins and supports the other. That's what successfully saw this project to the end of the day.
Probably a thousand fundraising volunteers have been working on this over the past couple of years, representing thousands and thousands of hours. Students present to me on a daily basis their need for this joint project, so that they will be able to achieve their educational goals within their own community. We'll see how this project fits within the Skills Now initiative of the government. We're bringing university colleges and colleges closer to high schools, so that you begin your college education right in your high school courses, building credits. When our theatre is up and running, we will have performances with the folk festival group that folks from other communities will want to come to visit. They'll come to Mission, and they'll see what our community has done together within this partnership to ensure that we have a better way of life in Mission.
This community partnership wasn't built around greed and wants; it was built around the desires and necessities to help a community grow -- not just culturally or through education, but economically as well. Imagine the spinoff benefits of this kind of a project being built there: the theatre and what it will attract, and the spaces that will attract folks to our community to have their meetings and enjoy our facilities, perched on the banks of the Fraser River, overlooking the south shore of the Fraser River. That's what's waiting for us when we have this project completed. The end of 1996 will see that up and running.
After I hear the response from the opposition member, I will tell the Legislature and the members how we accomplished this.
C. Tanner: The member for Mission-Kent is probably illustrating, as did the previous speaker, pride in his place of election and place of work. Having seen the subject that the member was talking about, it came to mind to review the situation in my community. I don't know whether members realize, but my community has two very distinct parts. One of them is the five southern Gulf Islands, and the other is the top end of this peninsula. Of the five Gulf Islands, three of them have very strong community association with each other. Saturna, Saltspring and Galiano have very strong associations on each island, but not necessarily with each other.
Today I'd like to speak about the community in which I physically live, and that is the top end of the island, which is composed of the three distinct municipalities of Central Saanich, North Saanich and Sidney. While those three communities are very distinct on many occasions -- and this is prompted by the member's topic -- when I started to consider it, there are many things that they work together on, not the least of which is a school board that includes two high schools. We have a most unique museum, the whale museum -- the only one like it on the north coast -- and an aircraft museum, which is one of only two in western Canada.
Sidney and North Saanich have a large and expanding arts council that is an illustration of a community working together. We also have one of the largest, if not the largest, marinas on the west coast, which attracts boat traffic from all over the west coast and, in fact, from all over the world. At Christmastime our community puts on the largest boat sail-past anywhere on the west coast, with over 100 lighted ships.
We all enjoy the same regional district and recreational area, and by coincidence, two of the three communities have the same police force. We all get water from the same place. In fact, we are now working together to put a joint sewer project in place that will take care of what is becoming a difficult situation. It's been very difficult for the three communities to see how they can work together, but they've come to the conclusion that they, like Mission, can achieve a lot more by working together.
The library service, of course, which all three areas enjoy, and the transportation services, which serve all three communities, all work very well together. I think we're probably unique in another circumstance, in that we have trilateral council meetings. The three councils get together once every three or four months and discuss mutual problems and find, hopefully, mutual answers. The chamber of commerce of the area covers all three communities. We have an organization called the Sidney Celebration Society that in actual fact, while Sidney is in its name, serves the communities of North Saanich and Sidney. We have an organization, the Sidney Association of Merchants, that promotes business in the area and serves the whole community.
I can't bring this subject up without mentioning that they also have what you might describe as a well-stocked stationery-book store that serves the whole community. But I should tell you that it isn't on wheels.
[10:30]
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Finally, I could say that all these things happen because the community pulls together to work for their mutual benefit. It is particularly important in the area that I live in for the simple reason that we are just down the road -- a short 22 kilometres -- from a large community, Victoria, which gives us other services but also pulls our constituents away from our area, and so I'm always pleased when I see the community working together. I congratulate the member for Mission-Kent for being so proud of his community, and I'm happy to tell him there are others like it in the province.
D. Streifel: Yes, I am proud of my community, and rightfully so. I look at where we began with this project and at the work that was put in, particularly by the folks from the school board and those on the joint planning committee and the university-college board: the mayor at the time, Kevin Redl; Vic Hollister, who heads up the fundraising committee; Tom Grieve, the current chair of School District 75; Keith Cameron, the superintendent of schools, Linnea Battel, from the community at large; and Francis Xavier, a renowned folk singer from the community who is working with the planning for the theatre project.
When we looked at this a couple of years ago, we thought we couldn't fail, and when I read the headline in the paper that said the new high school was scratched, I got very nervous. But with the cooperation of the community, who never let up on this issue and who backed me up every step of the way, I went to the ministers, the ministries and the Premier's office, and I explained that what we have here is a unique opportunity to deliver to the people of British Columbia an example of how governments can work in cooperation with local folks and with local initiatives.
When we were able to demonstrate that money was already committed from the Skills, Training and Labour ministry to build their portion of the university college campus that year, and that community money was also in place, there was enough in the capital budget this year to get us going for the whole year and not increase the K-to-12 capital envelope at all on this project. When that cooperation went from one ministry to another, we truly had a community partnership -- the community being the whole province, in this case -- to build something, to bring our community's needs from the grass-roots level. This was driven by the community and is being fulfilled by the community.
I take this opportunity today to put on the record my thanks to the community for helping out on this issue and for delivering on their commitment to themselves and to our future in Mission.
ACCESSING THE WORKPLACE
W. Hurd: I'm pleased to rise today to talk about accessing the workplace and the difficulties that resource workers in our province face at times in getting to their places of employment.
It's interesting to note that British Columbia is the third-largest province in the country, with approximately 95 million hectares of land. The bulk of that land is owned by the Crown. There are many, many workers in the province who rely on access to that Crown land in order to secure their employment. I think about workers in the forest industry, the mining sector, the emerging industry of ecological tourism and back-country recreation: these are industries that rely on secure access to the land base, to Crown land. Their activities are governed by legal licence agreements between the Crown and individual citizens and companies in our province. It seems over the last number of years that those licence agreements in themselves have not allowed resource workers to access their employment.
One of the greatest difficulties we face is the advent of blockades and protest activities that have had the effect of denying workers access to their employment. They will show up in the morning, there will be some sort of demonstration or blockade, and workers are then forced to go home for the day by virtue of being unable to deal with that kind of confrontation.
Given the fact that this has been a real challenge in the province, I can tell you that the community of Williams Lake, which was experiencing a similar blockade affecting resource workers, took the extraordinary step of launching a communitywide petition and enlisting the support of their city government in trying to pressure the province to accept some responsibility for ending these kinds of confrontations on our land base.
I received a copy of that petition and the resolution of council, and I thought every community in this province needed the opportunity to express an opinion on it. As a result, I took the resolution that was forwarded to me by the city of Williams Lake and wrote to other regional districts and local governments to find out whether they felt as strongly about this issue as did the people and council of Williams Lake. I was gratified and quite astonished at the level of concern and support out there for a resolution that would require some sort of involvement by the provincial government to try to end these blockades and illegal disruptions of the workplace, which have placed the livelihoods of resource workers in jeopardy.
The following resolution was sent throughout the province. At this time I'd like to read it into the record:
"Whereas many British Columbia communities are dependent on resource-based activities and the people employed in them; and whereas the activities on our land base are governed by licence agreements between the Crown and the licence holder; and whereas workers employed by licence holders have a legal and statutory right to access their employment; we, the elected council" -- in this case it's the town of Creston -- "call upon the provincial government to take action to ensure that resource workers are guaranteed access to their employment, free of blockades and confrontation."
As I say, I was gratified and surprised by the number of local governments that have endorsed that resolution -- the town of Princeton, Creston, Slocan, Silverton, Montrose, Midway, Gold River, Chase, the village of Ashcroft, Taylor, Sicamous, the districts of North Cowichan, Matsqui, Mackenzie and Kitimat, the cities of Vernon, Quesnel, Kamloops, Grand Forks and Dawson Creek, the district of Hope, Fraser Lake, Fort St. James, the village of Cache Creek, the town of Port McNeill, the villages of Pemberton and Sayward, the cities of Armstrong and Fernie, the district of Houston, the city of Trail, the districts of Abbotsford, Port Hardy, Port Edward and Tumbler Ridge, Fort Nelson-Liard Regional District and the village of Ucluelet. All supported the resolution asking for some sort of commitment from the province to ending these kinds of blockades. As most members currently are aware, it is now up to the individual licensee to seek an injunction to end these blockades. It's a costly and time-consuming process, and often no action is taken because of the concern over confrontation.
As I received these resolutions back, I was struck by some of the councils that decided to take no action. It underscores the great difficulty we're going to face in this province between rural and urban communities. No action was taken by the cities of Burnaby, New Westminster, North Vancouver,
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Richmond and Vancouver, Delta municipality, the township of Langley and the district of North Vancouver.
I don't necessarily fault the councils of those particular regions, but I think it underscores the problem we have in this province. At times, I believe that people who live in the lower mainland or who represent lower mainland constituencies don't understand how fragile employment is in some of our resource-based communities and how important it is for those men and women to be able to access their employment on an ongoing basis, whether it be in mining or forestry.
After this private members' hour in the assembly, I intend to table a list of those communities which have endorsed this resolution. I hope that in the future we can see more security for our resource-dependent communities in British Columbia.
J. Pullinger: I'm pleased to respond to this issue because, quite frankly, it amazed me when I saw it come through my community. I saw it endorsed by a council that was extremely right-wing, and they endorsed it with great alacrity. I understand the issues involved; I come from a resource-dependent community.
The member opposite is suggesting that we should take away people's fundamental freedom of association in this country -- the right to protest, engage in civil disobedience and take the consequences for doing that. In short, the member is arguing that we should bypass the constitution and the justice system. I'm not quite sure how you would do that -- how you would physically restrain people from doing what they did in the Clayoquot last summer, for instance.
The member also says it has been left up to the individual -- of course, he means his corporate friends -- to seek an injunction to end blockades, and somehow the state should decree that no one will ever blockade again. Were we able to do that -- and I am not of the opinion that it is desirable -- that wouldn't resolve the problem. Let's not forget that those 800 people arrested last year were not arrested because they were protesting in the Clayoquot or because they didn't agree with that decision. They were arrested because they defied a court injunction; in other words, they defied the law. So we can pass all the laws we like, and people are going to defy them anyway. Quite honestly, although I am frustrated by some of those activities, although I am angered by them and what they do to workers in communities like mine, it is nevertheless a freedom that I, and we on this side, hold dear and cherish in this society. We would not make any attempt to take away that freedom.
But what we're really talking about here, buried in this discussion and in these resolutions, is right-to-worklegislation. Right-to-work legislation really cashes out to be a fundamental anti-union position; that's what we're talking about. We're talking about free-market principles applied to human beings. We're talking about supply and demand in a situation where the supply always outweighs the demand. In the United States, they have 20 right-to-work states with either no minimum wage or a disgustingly low minimum wage, and they have all the consequences of that: exploitation, poverty and abuse of human beings in the name of profit. That is something that we in this country have rejected for most of our history, and hopefully will continue to reject.
The problem is that many people in this country don't understand what trade unionism is. They don't understand that trade unions came about as a defensive mechanism against exploitation of workers. In the community of Ladysmith, they used to blow up workers by the hundreds, because they had no way to protect themselves. They had no job security. If they didn't do what they were told, they were turfed out on the street, and so were their families. So trade unions are defensive mechanisms; they have always been so and remain so today. They balance the power between capital and workers. They allow us, through the collective bargaining process, to set some standards not only for one workplace, but for society -- standards of wages, security, health and safety.
Trade unions have also played a role in society. Trade unions have been on the leading edge of progressive change since day one in this country. In the 1890s they were talking about equal pay. They recognized it wasn't fair to pay women less because they were women. They've been on the leading edge of the fight for universal health care. They've built hospitals and brought health care systems into communities throughout our history. The trade union movement, through the labour council in Victoria and the corporation known as Innovative Housing, built much of the cooperative housing we have right here in Victoria. It's affordable housing, built by union labour, that provided decent jobs. So there are a lot of benefits to trade unionism, and I would offer that we don't want the kind of society we would have without trade unionism.
[10:45]
I think there is a wonderful line by Tracy Chapman in her song that I think is called "Across the Lines." It exemplifies very clearly what would happen if we didn't have trade unions. I'll just quote it quickly: "The back streets of America, they kill the dream of America." We don't want that in Canada.
W. Hurd: I'm not sure how the response ended up being a dissertation on the values of trade unionism, but I think it's important to revisit this issue in its most basic context.
The sad reality in British Columbia is that miners, resource workers and forestry workers are showing up for work in the morning and are unable to access their employment because of events over which they have no control. The resolution that I read into the record earlier is a plea for help from the people in places like Creston and Silverton and Montrose and Gold River -- communities that have supported this resolution because they see the destructive and corrosive effect on their communities of these kinds of illegal blockades.
A licence agreement between the Crown and individuals -- not necessarily large companies, but individuals, many of whom have licences with the Crown -- are legal agreements. They entail certain responsibilities and rights for both parties. When, for whatever reason, the rights and responsibilities under those agreements cannot be exercised, the fundamental question that has to be asked is: who is going to be accountable and responsible? As things stand now in British Columbia, it's up to the individuals to seek court injunctions, have the injunctions served and see people arrested, if that's what occurs. It's unfortunate, because it pits individuals in communities one against another.
The provincial government, for whatever reason, has suggested that it's not going to take any responsibility for its side of managing the land base, namely the Crown agreement. It's lamentable, because the councillors in these communities, in their wisdom, are concerned about the corrosive effects of these activities. They are looking to the province for some sort of direction that allows their communities to get on with the job of creating employment, paying their mortgages and supporting their families, while all these initiatives that we've talked about in this assembly to try
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to resolve these matters, including the CORE process and the Treaty Commission, are being dealt with. All they want is the right to go to work and earn a living while this is going on. I certainly have great hope that the province will be able to guarantee them that right in the future.
UNBC -- A TURNING POINT FOR THE NORTH
L. Boone: This seems to be a northern day today, and this was not collusion with the member for Peace River North. We did not agree that this would happen today. But it has happened, and we're proud that it has. I want to talk a little bit about the effect of UNBC and the turning point that has happened for Prince George and the north.
When I first arrived in Prince George in 1969 I went there to teach, and it was a booming town at that time. We had just been through a period when three pulp mills were built in the city in a very short space of time. In fact, we had just recently got rid of our wooden sidewalks. When I told people I was going to Prince George, they said: "Why on earth are you going there?" I had no idea where I was going. In fact, I had never been north of Cache Creek -- much the same as many individuals here.
When I headed up north, I was pleasantly surprised to find that a refined society -- not too refined -- existed there. Many of us who went into that community at that time had no friends there. We had to make our friends, and we did. We developed a sense of community that still exists today. When we moved there, people came from the lower half of the province, the U.S., Australia; they were coming from all over to populate the north because it was booming so well. People had a frontier attitude about moving there. They weren't sure what they were moving into -- and this goes for those who moved into Fort St. John, Vanderhoof or any of those northern areas. There was a sense of adventure and a sense of opportunity, because they didn't have those opportunities in the lower mainland or the prairies, which is where many of our people come from.
Fortunes were made by many in that area. Individuals went there with a sense of pride, and they worked their way up. They made money with very little educational requirements. Some students I was teaching virtually told me: "Why should I finish my schooling? I can go out in the woods and earn more money than you." In 1969 that was possible, and it was probably true that they did go and work in the woods and earn more than I did. Those days didn't last very long. We have watched as that community has matured. People came for one or two years, and they're still there. People are still in that community 25 and 30 years later. They have established roots and families; a sense of community exists there. We've watched it develop economically. Sawmills, pulp mills, chemical plants, oil refineries and services have come into those areas. I've seen some incredible changes in the years we've been there.
We also developed a sense of pride -- pride in who we were, pride in being northerners and pride in our community. Despite that pride, there was always an underlying sense of inferiority, because people would ask: "Why are you going north? Why are you up there? Why are you in that smelly community of Prince George?" We would say: "That's the smell of money." While the smell of money has since gone because they've put in all these pollution controls -- wonderful things that this government has done -- we still have the thriving community there.
Changes occurred. We recognized that we were important. That recognition didn't come about easily, because some people still seemed to think we could be shifted aside. We realized that we were important and that we had the right to expect some services. We virtually coasted through the eighties. We didn't really come down; we didn't really improve. At that time, people suddenly started to say that we needed some changes, in recognition that we could no longer get those jobs in the woods; we could no longer go out and earn high-pay without the educational requirements.
Communities throughout the northern half of this province bound together in the late eighties and early nineties to demand that the previous government and then this government recognize they needed to develop a facility in the area -- a university to meet the educational needs of our community. It was noted that it was needed not just for the educational needs but also the social needs. We needed it to give skills to our people so that we could keep our people there; we needed it there for the cultural and economic areas; we needed it so that our children could stay home. We've watched our kids leave, go to university and not come home to our communities. We were getting a little tired of that, so we wanted a university in the north that meant people could come and stay.
We watched people going down to universities and sometimes failing because of the cultural shock of moving from smaller communities, like Burns Lake, into the large metropolitan area of Vancouver. You're very familiar with it, hon. Speaker, but it is a shock to somebody who comes from a rural area. People sometimes couldn't cope there. We needed a university in the north that would provide services for all of us, not just our young people but also for adults. Many adults, many of whom were women, had partially completed degrees and would have had to leave home in order to complete them.
A university did come about, and it has proven to be the catalyst for change in our area. We have a sense of optimism and pride; we have a sense that things are moving and changing -- that we are, in fact, maturing as a community. It has spurred investment in our community; it has brought new businesses; and for the first time in the past couple of years, we have some spec homes being built. We have a tremendous feeling there. Citizens are investing in our community. Our own council -- and we're one of the few around -- passed a referendum for a sports multiplex to be built in our recreation area, which is fully financed by the taxpayers. We are not asking for B.C. 21 money for this. That would be nice, but we haven't asked for that at this particular time. The people in the area said: "Yes, we recognize that this is important to our community; yes, we're going to get it there." As a result of that, we now have a WHL team, the P.G. Cougars, which came from Victoria to be in our area.
I'll finish my speech afterwards, hon. Speaker.
C. Serwa: This is a pleasure. It's the first time I've had the opportunity in this session to respond to a private member's statement, and I welcome the opportunity.
I'm very pleased to hear the member speak so positively about the north and the opportunities there. The member is obviously aware that a great deal of the access to the north and the opportunities there were due to the former Social Credit government. I know that the member is deeply appreciative. It's very interesting to hear the talk of the pulp mills. Nineteen of the 25 pulp mills, over 1,100 schools and 100 of the 122 hospitals in the province were built under Social Credit governments.
But the discussion here focused on education. I am very proud of that field, because the University of Victoria, Simon Fraser and the University of Northern B.C. were all initiated
[ Page 12083 ]
under Social Credit governments. An extensive community college system was made available throughout the province, and the concerns of the north were paramount there: Northern Lights College in Dawson Creek; Northwest Community College, with campuses at Terrace and Prince Rupert; and the College of New Caledonia, with campuses at Vanderhoof, Mackenzie, Smithers and Burns Lake. Things like the Open Learning Agency, the Commonwealth of Learning satellite network, BCIT and the Emily Car College of Art and Design were all brought in by Social Credit governments; and under Minister Stan Hagen with the last government, the Access for All program.
What does it mean? It means a tremendous vision and opportunity for British Columbians, not simply for those in the central part of the province and Prince George. I am pleased that we had support from the hon. member who delivered the private member's statement when Bruce Strachan spoke as an advocate. It enables stronger communities to be built in northern British Columbia and students to be educated there with that strong sense of a northern community. It is a cohesive force that overcomes partisan differences -- community competition.
It is a very proud moment for me to stand here and thank the hon. member for her statement.
L. Reid: I too welcome the comments of the hon. member for Prince George-Mount Robson, because I think it's important that we are building and enhancing a sense of community by the addition of a university -- basically to the centre of the province, but certainly far more to the north than we've had in this province. It would be a glorious trend if people went into northern British Columbia to the University of Northern B.C., as opposed, as the hon. member has stated, to constantly coming down and perhaps not returning to communities.
I welcome the new initiatives and the choices that young people -- frankly, people of all ages -- in this province will have, because I too would like to see a continuation of those going up to university and those coming down to university, as well as having the ability to exchange ideas and build on some potential for that region of the province. I would love to see that as a glorious site for research and development. I would love to see the ideas from the marketplace originate in a university laboratory. I would like to see that value placed on the ideas that students in this province will have and will continue to have, and hopefully, they will find some comfort in academic pursuits at the University of Northern B.C.
There will be tremendous spinoff effects for that community. There will be increased commerce, and it will be a boon to the economy; that I strongly support. It is valuable that we are trying to tighten up what we intend to do for economic prosperity across this province. It's very fine that we're building such a beautiful campus. I think that the passion around ideas will glow from the fact that that is such an interesting site and such a glorious architectural dream for the province, if you will. It's done some wonderful things for that area, and I appreciate that the community use of those buildings -- such as the theatre that will offer programs for the community -- is the kind of thing that this Legislature can be incredibly proud of.
I understand that Her Majesty Queen Elizabeth will be visiting in August to officially open that facility. That is a wondrous opportunity for the community to come together and build something incredibly fine.
[11:00]
At some point I'd like to see a cancer clinic operate from that university. I would like to see those kinds of services in the health field available for that area of the province. As the hon. member has stated, it won't be just people coming down to the lower mainland for services, but people being able to stay in and to travel to that region of the province for services.
L. Boone: It's nice to see such support for the university, and I hope to see that from everybody out there. As I've said earlier, this university is a catalyst for change in our area. We will be and are already seeing research which is going to be assisting our many businesses and industries in the area. That's good news for all of us.
We will be having some programs unique to the north; again, that's something different. I've always said that if UNBC tried to be in competition with the lower universities -- Simon Fraser, UBC, UVic -- it wouldn't work. It has to be a unique university and has to have its own flavour. And we are seeing that.
We are seeing that through the quality of the faculty who are coming to teach there. The faculty we have are the cream of the crop. They have a sense of adventure, they want to change and they feel they've been stifled in some of the other universities. Now they have an opportunity to come in and actually establish a faculty and the way that faculty is going to go. There is tremendous excitement around that.
We also have some incredible students coming. They're coming not just from the north but from all across the province. They're coming there because they want to have the opportunity to participate in a new university -- a new and exciting opportunity to be part of a new development there. As somebody who attended Simon Fraser as a charter student in 1965, I can certainly relate to the whole idea of going to a new university and being on the ground and foundation stones of those areas.
I'd like to invite all British Columbians -- and those from outside B.C., if anybody happens to be around listening to this -- to come to UNBC to participate in those programs up there. As I said earlier, the roads go both ways in this province. We expect people to travel up and to come there. They'll find opportunities for everybody there and a chance to join in an exciting educational adventure and an exciting community as well. They'll also find affordable living in Prince George, which I'm sure those in the lower mainland are striving for right now.
UNBC is truly the turning point in our history. It's a turning point for Prince George -- and for the north too, because all of those people throughout the north will be gaining from this with the campuses in their areas. This is also a turning point for British Columbia. It's a recognition that there is more to B.C. beyond Hope, that there is hope beyond Hope for those of us there, and that in fact we can develop and have pride in the rest of the province.
I look forward to having Her Majesty the Queen there on August 17. We look forward to having our first students in September. And we look forward to being an exciting part of British Columbia.
W. Hurd: I'm pleased to table a petition and letters from those regional districts and local governments in British Columbia supporting the guarantee-of-work initiative.
L. Reid: I beg leave to make an introduction.
Leave granted.
[ Page 12084 ]
L. Reid: Today we have 50 grade 7 students from Garden City Elementary School in the riding of Richmond East. I ask the House to please make the students and Mrs. Gilbert welcome.
Hon. G. Clark: I call Committee of Supply for the purpose of debating Ministry of Employment and Investment estimates.
ESTIMATES: MINISTRY OF EMPLOYMENT AND INVESTMENT
The House in Committee of Supply B; D. Lovick in the chair.
On vote 23: minister's office, $362,400.
The Chair: I understand, minister, that you intend to make an opening comment on your estimates. So please proceed.
Hon. G. Clark: Actually, I think I will defer my opening comment, hon. Chair.
Interjection.
Hon. G. Clark: Yes, until there are more members in the House -- absolutely.
By prior agreement, so there is some order -- there is a fairly long list of different things that this ministry is responsible for, but we haven't quite prepared the list to have the debate in an orderly fashion -- we agreed this morning to spend the next couple of hours, at least, discussing the B.C. Ferry Corporation and any questions on that. If people have other questions that they want to pursue on B.C. Transit or whatever, we can certainly do that as well for these two hours.
With that, I'll defer my broader remarks on the overall ministry and what we're trying to do to another day.
D. Symons: I agree with the minister when he says he has a great number of interests within the Ministry of Employment and Investment. Indeed, in a sense I envy him yet do not envy him because of those large numbers. I envy him in the sense that he certainly has a great number of interesting items in his portfolio. I'm wondering, though, if one minister should have as much control over other ministries as well. I believe Ferries and Transit really belong in the Transportation ministry; but they don't, they belong to this minister. Indeed, in my mind, the financing of highways in the province should also belong to the ministries of Transportation and Finance, but that belongs to this minister. We'll be canvassing many of those topics during these estimates.
My opening questions on B.C. Ferries are on directorship. I'm wondering if you might explain the qualifications that cabinet looks for when deciding who to appoint to the board of directors. I'm wondering if you look for people with marine and shipping experience. Do you look for people who have business and accounting experience, so we might have that brought into operating Ferries? Is it marketing and tourism experience? Indeed, operating Ferries involves that. Do we also look for regional representation? Do we have people from the North Coast, mid-Vancouver Island, southern Vancouver Island, Sunshine Coast, Gulf Islands, North Shore, Delta-Tsawwassen area, Vancouver? Are these sorts of people on the board?
I'll just lump two other questions in as well, if I can, and you can answer them all at once; we'll move faster that way. How many directors are there currently? Are there any vacancies? On the frequency of meetings, is there a regular schedule of meetings? Tied in with this, what would the honorarium be for directors, and what is their per diem when they are meeting?
Hon. G. Clark: First of all, I should introduce the staff from B.C. Ferries who are here with me. First, on my left, is Admiral Mike Martin, who is the CEO of the Ferry Corporation; also Rod Morrison, who is the general manager of the corporation; and then Glen Brown, who is the chief financial officer of the corporation. I'm sure they'll correct me if there are any errors in their titles.
Those are good questions. There are 11 members of the board of directors by statute. The government of the day cannot add more than that. Many Crown corporations -- perhaps most of them -- do not have a statutory limit or fixed number. B.C. Ferries does; it's 11, which includes the chair. When we decide on boards of directors for all of our Crown corporations and agencies of government, we take into consideration a variety of factors, all of which the member alluded to.
First of all, we wanted to try to pursue gender equity. In some cases there are more women than men, and in other cases more men than women. But in general, where possible, we want to try to achieve 50 percent women and 50 percent men. In this particular case at Ferries, the last time I checked, there were five women and six men, although one of the women is chair of the board. Maureen Headley is the chair of the board, the first woman chairperson of a Crown corporation in British Columbia history, and Maureen has done a superb job. So gender is one of the factors to consider.
Region is important. The member makes this point, and I agree with that. With all due respect to our last speaker, would you put someone from Prince George on the board of directors of the B.C. Ferry Corporation? Not likely. Nor would you, perhaps, from the Kootenays, either. We do currently have one member of the board who is living in Kamloops. She was appointed when she was living in Vancouver, and she has just recently moved to Kamloops. She's doing an excellent job, and I'll talk about her more in a minute. So there is a bit of regional representation.
We have someone from the Queen Charlottes as well, Frank Collison, who's an aboriginal representative. So we have some aboriginal representation -- not for the first time, but one of the very few times -- and representation from the Charlottes, which is a highly subsidized route. We have Maxine Williams, who's from Alert Bay on the north tip of the Island. She is the president of the Association of Vancouver Island Municipalities. She's a councillor from Alert Bay and is active in the tourism industry on Vancouver Island. That was clearly a factor. Arne Olsen, who is a business person in Vancouver, a former owner of Imperial Parking and a very successful entrepreneur, is on the board.
Joe Morris is on the board, and this a bit unique. The union has in their collective agreement -- and the company and the government of the day agreed -- that the union has the right, by contractual law, to appoint someone to the board of directors. Joe Morris is their representative. They've recently gained the right to nominate a second person to the board, though at this point there are no vacancies and we haven't dealt with that question. But Joe Morris is on.
We have Ash Katey, who's a successful chartered accountant, a partner in a firm called Chambers Phillips in Vancouver; Khushpal Gill, who's a realtor now with a
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company in Richmond, Multiple Realty Ltd.; Curtis Eaton, who is an economics professor at Simon Fraser University; and Gretchen Brewin, an MLA for Victoria, a region served by the B.C. Ferry Corporation.
[11:15]
Caroline Langford is a freelance educational publisher. She was previously vice-president, I believe, of Douglas and McIntyre. In fact, when I first got responsibility for the Ferry Corporation and had some input into the selection of the board of directors, one of my upfront reasons for putting Caroline Langford on the board was to try to pursue a rebirth, if you will, of the bookselling facilities and gift shops on B.C. Ferries. In other words, we wanted to try to focus on British Columbia publishers, artists and authors -- and we can talk more about that. She's been chairing a committee of the board, she's looked into that question along with Gretchen Brewin, and I think she has done an excellent job. They've been very, very successful.
I shouldn't repeat these anecdotes, because I don't know if they're true. But a book publisher told me that there's been a 10 percent increase in sales of British Columbia-published books, which they attribute almost solely to the B.C. Ferry Corporation's focus, particularly the superferry's focus, on B.C. books. That's astonishing if it's true, but it's certainly a significant increase. I get nothing but compliments from British Columbians about how proud they are of the bookstores on the ferries. I think it's a real success story. I would be interested in the comments from the member for Saanich North and the Islands, because, of course, I was desperately trying to get his company to bid on that proposal. Unfortunately, he chose not to do so. Duthie Books is doing an excellent job. I don't how they're doing financially, but certainly from the corporation's point of view, they're doing very well.
On balance, I'm very impressed by this board of directors. It has ethnic representation, for the first time ever; it has aboriginal representation; and it's virtually gender-balanced. It has regional representation from around the province, although there are some sore points with regard to that, because there isn't someone from the Sunshine Coast or the Gulf Islands. I'm very sympathetic to that. You can see that we tried to balance all these interests, and we think we've done a very good job of that. But I know there is some concern there, and we will obviously look at that if we have a vacancy. Before I became the minister, there was one vacancy, and the previous minister appointed Joyce Smith, who is a certified general accountant in Nanaimo. I guess the minister of the day wanted to have someone from Nanaimo represented on the board of directors, and I certainly have no quarrel with that. Despite the fact that there's always going to be criticism, I think that, in general, it's an excellent board, with broad representation.
The board essentially meets once a month. The subcommittees probably meet once a month, so that means many board members have two meetings a month. They're paid by a Treasury Board directive, similar to other Crowns. I think it's an honorarium of $3,000 a year for board members and $200 per board meeting, and a $5,000 honorarium for the chair. Believe me -- and I say this in all sincerity -- they put in hours and hours of work for which they clearly do not get compensated. It is not a paid position for all intents and purposes; it's an honorarium, which in no way compensates them for the enormous amount of work and effort they put into it.
D. Symons: I have just two remarks regarding your comments. I'm not too sure whether B.C. Ferries has achieved gender equity, in spite of your claim that five women and six men are on the board. I haven't yet seen ferries named King of the North or Prince of Vancouver Island, or whatever; they all seem to be named after women. We hope that you will be bringing some equity into the naming of ferries as well, if you believe in equity so strongly.
You also mentioned the sale of books. I suspect that what you said is true, because I have had some representation from booksellers, those who sell and deal with books in British Columbia primarily, who feel that the ferries are unfair competition for them. It wasn't the member here; it was somebody on the Sunshine Coast. If that's the case, and they're complaining, I suppose it's because the ferries have been successful and that they have a captive audience for selling books on B.C. Anything that gets the message out that B.C. is a wonderful place is good, I guess.
I believe that the member for Saanich North and the Islands would like to ask a question, too, regarding something you said.
C. Tanner: I must note right from the beginning that the reference to a business establishment in Sidney.... That belongs to my wife and not to me. In fact, you might as well know, Mr. Minister, that when I suggested that I was finished here and was going to look for a job there, she said: "You should look somewhere else."
I have a very simple solution for the minister regarding his next appointment, to solve the problem of representation from the Islands and by an MLA. I happen to be that person. If you want to remove the MLA who lives in the middle of Victoria and put one on who represents the Gulf Islands, lives on the coast and is very broad-minded, I would be happy to accept.
I believe there is a problem with a couple of your board members. One is Caroline Langford -- I think her name is -- from the publishing industry. While I understand what the minister is attempting to do, I do believe that in fact Ms. Langford is a publisher herself -- a major publisher, in fact, as I understood the minister -- and the fact that she's making decisions on what books should be on the ferries is a bit of a problem, I think.
The other question is with regard to the union members on the board. While I think it's a good idea to have staff representation on boards, they must occasionally find themselves in conflict, particularly when they're ruling on working conditions, salaries and things like that. Could the minister tell us -- or reassure us -- as to how that member handles those situations, and how the board handles them?
Hon. G. Clark: First, as I understand it, Ms. Langford is not a publisher; she's doing some freelance work. She was an employee of Douglas and McIntyre; she's not now. Second, the choice of the books is really that of Duthie Books, along with the management of B.C. Ferries; the board doesn't involve itself in that -- just to give the member some comfort in that regard.
The second question the member asked is a more philosophical one -- and an interesting one, actually. The ferry workers' union has a contractual right now to nominate someone for the board, but I don't believe that right extends to the employees of the corporation, or maybe it hasn't been stipulated. In other words, giving a worker a seat on the board of directors is something we could debate in this House; in fact, it's probably a worthwhile debate. I tend to be quite sympathetic.... I shouldn't say "tend to be"; I'm very sympathetic to having one or two workers who work in the plant, if you will, on the board of directors. That's not the case here. In fact, the ferry workers' union has not
[ Page 12086 ]
nominated someone who works for the Ferry Corporation to be their nominee on the board. Joe Morris has retired, and so he is not the nominee. There are some other people the union has thought about, but they have chosen to say that they don't want to put one of their members who is employed by the corporation on the board -- at least, they haven't to date, and I think it's because of the concerns over conflict. Although they may choose to change that, they obviously haven't done it in this case.
My own view is that I don't see anything wrong with someone who actually works for the corporation, an employee, being on the board -- provided, obviously, that they have to exempt themselves or absent themselves in areas that deal with labour relations or remuneration. That's not uncommon. That happens in other countries, in Germany and other places, but we haven't done that anywhere in this province that I know of. In fact, we're having this debate on the health councils, and we've been criticized because the government is not allowing health employees to be on the health councils.
So that's an interesting debate. It's not really germane here, because the union has chosen to put on the board of directors someone who doesn't work for the corporation, who therefore has some fiduciary obligations to the corporation and does not absent himself from discussions. However, by virtue of being a director, he is essentially prohibited from trading, if you will, in certain information that would give an advantage to the union. This has been going on for some years -- before we took office -- and my advice from staff when talking to the staff members about this situation is that they have not felt compromised by Mr. Morris's seat on the board. In fact, I think it's been quite beneficial both to the union and to management to get a different perspective from the workers. He has been a bit of a conduit, if you will, for the union to advance issues, concerns or grievances to the board, and to take some concerns back. But there is, I think, a line there with respect to the fiduciary obligations of the individual -- which has not been crossed.
Anyway, it's a broad, interesting debate. I tend to side a bit with actually putting workers on all of the boards and then having clear conflict guidelines set where they absent themselves. That's more of a German or European model; we haven't done that in British Columbia. I can tell you that in my capacity as minister responsible for the Crown corporations secretariat I have asked for some work to be done on that in a broad sense. No decision has been made and not much work has been done, but I'm kind of interested in the idea, because I think it can help labour relations problems. In this particular case, however, this is someone who is not an employee, so we've not run into any particular problems.
C. Tanner: Of course, I appreciate what the minister said. One must understand that that appointee by the unions is obviously sympathetic to them.
What about the second contractual appointment of another member on the board, which the minister mentioned earlier? Will the second one be in the same capacity as the one there now?
Hon. G. Clark: We're in some discussion with the union on this question because of the definition of "vacancy," in some respects. My understanding is that they would nominate a second person. The government would put that person on the board of directors, and that person would be the same as Joe Morris. They may well nominate an employee. There is no prohibition on that. They have not chosen to do so. I've told you that I'm rather sympathetic to the notion, in any event, so I wouldn't particularly have a problem with it. It is quite a legitimate area of discussion for members and for public policy debate, but we have no.... The union would not say: "Well, here's five names; pick...." They have a contractual right to nominate someone, and they will choose to nominate whomever they wish to. It may well be the second nomination, or if Mr. Morris decides to step down, both nominations may well be employees at some future date.
C. Tanner: I'd like to address a question to the minister with regard to book sales on the ferries. First of all, the minister, his board and this House should understand that I have had a longstanding interest in the sale of books for about 25 years, and I consider myself something of an expert on it.
It has always been the policy of any company that I've been associated with to buy Canadian first -- sometimes to the exclusion of the market we serve, because sometimes it's not that easy to get books from Canadian publishers. Quite frankly, in many respects, Canadian publishers deserve the disrepute they've fallen into, because without subsidization from government half of them would disappear. There's a good discussion as to whether or not some of them should disappear, but the fact of the matter is that I have always felt Canadian publishers and distributors should be supported.
That being the case, I'm very pleased to see that the minister has expanded the sale of British Columbia books on the ferries. I have no objection to having books, crafts and things like that on the ferries. In fact, in both settlements that I've lived in, we supported local museums doing exactly the same thing and usually gave them extra discounts so they could. A fact of bookselling is that a lot of bookstores are located near libraries, where they're handing out free books, but it induces the sale and reading of books, and it's better for business.
Having said all that, I've travelled the ferries a great deal in the last two years -- fortunately at the expense of the taxpayer, I should say, which I find somewhat embarrassing sometimes. However, having observed the bookstores very closely, I would make two comments. I suspect -- if you can define it, because you're retail areas have expanded -- your book sales overall have dropped, because I don't think you're offering enough variety. I find people on the ferries commenting that while there is a very nice selection of British Columbia books, in actual fact, there is not a large enough variety of books.
[11:30]
The second comment I would make.... I notice your advisers, Mr. Minister, are nodding their heads in disagreement. They should look at the sales if they didn't have the two large retail outlets in the new ships. That's what has made the difference. I hear complaints that there is not enough variety of general books, because people don't necessarily want to read about British Columbia. It will also be interesting to see when your sales come, whether they are in the summer or the rest of the year. That's number one.
Number two is that I have been unable to find postcards on the ferry recently, and I don't know why there aren't any. If they are there, they're a very recent addition. You're missing a huge market. I used to be in that business too. I don't feel that I'm selling my industry or my wife's store short in promoting sales on the ferries. It does seem to me that those two comments can be fairly made.
Hon. G. Clark: First, on the latter, I too had a complaint from somebody about not having postcards on the ships and had my staff check. They have advised me that there are
[ Page 12087 ]
postcards on the ships. You're the second person who has made that assertion, hon. member, so I'll make sure. Maybe from a marketing perspective they're not visible enough.
With respect to book sales, maybe I'm misunderstanding the member, so I'll just restate the facts. There has been a dramatic increase in book sales on ferries as a result of the retrofits, the superferries and the concentration on B.C. books. It's dramatic. Again, we don't have the statistics here, but we've sold close to double the number of books we had in the past. The large reason for that is the two superferries, so the member is correct in that respect. The two superferries and their rather spectacular retail stores and their very nice displays of B.C. books are principally responsible for that.
We have had criticisms of the stores on the older ships, where the stores are not as large, and the focus on B.C. books crowds out the sort of popular books. So there is a bit of criticism about the lack of variety, which I acknowledge, but it's fairly modest. When you look at the numbers and see this dramatic increase in the sales of all books, particularly B.C. books, we haven't found it to be a particular problem.
In terms of summer and winter sales, I haven't seen the numbers lately -- and I don't know if the member's getting to this -- but there is a significant increase in sales in the winter, which is a surprise to me. One of the reasons for the focus on B.C. books, etc., is in part to deal with the tourist traffic, because we thought they might be more interested. In fact, the surprising thing -- for me, anyway -- is that local British Columbians who are taking ferries in the winter are obviously buying more B.C. books as a result of our efforts. That's one of the reasons that I'm very proud of the initiative. It has actually had a significant impact. Do we sell more books in the summer? Clearly we do -- a lot more -- because of the traffic, but we are also selling more books in the winter and more books overall.
We could spend more time on this in the House, of course, but if the member wants -- I know he has an interest in this, and I certainly acknowledge that -- I'd be happy to have a more detailed briefing specifically on the bookstore, because I for one certainly think the government and the corporation would benefit from the member's expertise, and I have no hesitancy saying that in the House. So any criticisms or comments or otherwise.... Even though in a way he is a bit of a competitor, I certainly recognize, from his comments today and elsewhere, that he is very supportive of the corporation's effort to sell books on the ferries. I'd be happy to offer that, if the member's interested.
D. Symons: If we can book off the subject of books and go back to union representation, I note that the minister said he was sympathetic to union representation on the Ferries board. I note that in Richmond, though, you cannot run for the school board if you happen to work for that particular school board, but you can run for the school board if you work for a different school board. Maybe that's the Joe Morris sort of connotation. I think he had a long history with the forest industry in B.C. Also, if you're a doctor in Richmond, you can't be on the hospital board there. I'm wondering if you expand that generosity -- having people involved in the field also on the board -- to these other organizations as well.
I believe you used the term "gained," in that the union had gained, and you also used the term "contractual agreement" to have the second member there. I assume that having a second union represented on the board is something that's been done recently. I also assume it was something that was worked out during contract negotiations. Is that true?
Hon. G. Clark: I'm just clarifying that. As I understand it, both clauses are permissive -- at least, that's the corporation's interpretation of the collective agreement. In other words, with respect to Mr. Morris -- but not to personalize it -- in a previous collective agreement under a previous government that was negotiated between the corporation and the union, the union had the right to nominate one person for the board. It's a permissive, not an obligatory, contractual right. They have the right to nominate. They nominated Joe Morris; the previous government appointed him.
I don't know if the member is familiar with this, and I probably shouldn't volunteer this, but after we took office, I removed Mr. Morris from the board, and the union complained. For a very brief period of time, he was not on the board. The union drew my attention to their collective agreement and their longstanding commitment, and he was subsequently reappointed. I removed the entire board of directors at the change of government, because I didn't want to single out any particular board members and say they were good, so they could stay on, and others weren't; I was making the point that we wanted a fresh start.
In any event, the second person -- which has just been concluded in the collective agreement -- gives the union the right to nominate a second person. At this point, we have not put a second person on the board. The union obviously negotiated the right to nominate, and they would like us to do so. We are sympathetic to it. We obviously agreed to the collective agreement, but we have not at this point accepted any nominations for a second person on the board because there are no obvious vacancies on the board.
D. Symons: I think that clears up something that was in the minutes of the board in '92, when the union representative sat there as an observer on the board with a per diem of $200, or something of that sort. I assume that was at the time when you had taken all the members off and then reappointed some, but hadn't reappointed the union member. He had observer status for awhile.
Changing to a different topic, I wonder if we can move on to the president and CEO. I don't know if I missed any announcements, but I thought that when Admiral Martin was appointed, it was an interim appointment. Has that appointment been made permanent, and if not, are you searching for a permanent person? My concern is that we seem to have seen almost a revolving door at the top of B.C. Transit, and I would hate to see that happen to B.C. Ferries, which I think is being run with a much better and more responsible format than B.C. Transit. What is the current status, and what are you working with respect to chief executive officer and president of the corporation?
Hon. G. Clark: Mr. Martin is the acting president and CEO, and we are engaged in a search for a permanent CEO. I do reject the suggestions, of course, with respect to B.C. Transit, which we'll get to another day.
I once talked to one of the wealthiest men in Canada and asked him about executive recruitment. He said to me: "I get it about 50 percent right." Obviously, when we are going through a transition and reviewing things, we try to look very carefully at who we would appoint to these positions. We're not always right; they don't always work out. That's the nature of any appointment, but in particular when you are looking for someone to manage a very large Crown corporation, which has a more difficult mandate than in the private sector. You are dealing with demands to achieve private sector accountability -- which I personally try to
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drive very hard, and so does the Crown corporations secretariat -- and to marry that with the public policy aspects and the kind of scrutiny you are under in the public sector.
I don't make any apologies for any changes we might make to try to get acceptable people in place. Mr. Martin is doing a superb job at the corporation, did so prior to his appointment as acting CEO and continues to do so. We have every confidence in him, so there is absolutely no rush. The corporation is in good hands. We are engaged in a review, and there should be some decisions made fairly shortly in that regard.
D. Symons: My question was by no means a criticism of Admiral Martin; in fact, I would hope that he is one of those being considered for the permanent position.
Grants and contributions, I note, are down from $41.6 million in the previous year to $36.2 million. Of that $36.2 million, $3.14 million is for operating expenses. I see that this figure includes grants in lieu of taxes and the corporate capital tax. I'm wondering if you can tell me how much is budgeted for the grants in lieu of taxes and how much is for the corporate capital tax?
Hon. G. Clark: About $1 million is for grants in lieu of taxes, and about $2 million is for the corporation capital tax.
D. Symons: How do those figures compare with the 1993-94 fiscal year that is now ended? While we're at it, is ferry travel a service that's taxable under the PST?
Hon. G. Clark: The numbers are almost the same for the grants in lieu of taxes and the corporation capital tax. The answer to the second question about taxable services is no, they're not.
D. Symons: There is a $4.8 million capital contribution, and I gather that figure was the same for the last fiscal year. Was this for the conversion of the Queen of Burnaby to the Royal Victorian?
Hon. G. Clark: It has nothing to do with the Queen of Burnaby refit that was done by the Victoria Line. B.C. Ferries just made it whole in that regard. With respect to the numbers the member is referring to, those are the lease payments.
D. Symons: I gather that a few years back a good number of ships were sold off in a leaseback arrangement, and that put a bit of money into the provincial coffers to hide the amount of the debt at that time. What is the current status of the leaseback program? Have we purchased back most of our ferries, or are most of them owned by someone else?
Hon. G. Clark: I don't mean this as criticism, but it was probably a fluke.... Those are excellent questions. Three of the leases come due this year, and the government will have to buy them back for $8.2 million. The member -- and the Finance critic for the opposition will know, probably better than anybody in the room -- that the sale-leaseback had significant federal tax advantages. The province was selling its tax advantage, because as a Crown corporation it cannot take advantage of.... These were essentially tax deals that brought the cost of capital to the corporation down some 11/2 percent lower than the cost of borrowing, as I recall. So one can quarrel with the sale-leaseback, and I think there's a lot of concern about it. I wasn't there, so I don't want to defend them. Maybe it was to hide debt, maybe it wasn't. From a business perspective, the bottom line is that it did reduce the cost of capital by about 11/2 percent on some fairly large purchases.
F. Gingell: Going back to the issue of the vacancy in the office of permanent president, does the Ferry Corporation have a succession-planning program?
[11:45]
Hon. G. Clark: These gentlemen are the wrong people to ask in that respect, it seems to me. I think the short answer, precisely, is that it doesn't. That's an interesting question for all the Crown corporations. The boards probably need to give some consideration to that, and I don't think that heretofore they have done so. In this particular case, generally speaking, there is no concern. It's a well-run corporation and it's won awards for its turnaround time, etc. It's a large corporation and it runs very well. In fact, it's one of the largest ferry fleets in the world. We have more ships in B.C. Ferries than the Canadian navy has, as Admiral Martin can attest; as he reminds me, it's not very hard to do. So it's a big operation and it's doing quite well. But there is no formal, if you will, or even informal succession plan.
F. Gingell: I actually wasn't thinking about succession planning for the role of president; I was thinking that good corporations have very real succession-planning programs. In the management of the most important part of the operation -- which is, of course, the actual vessels themselves in this case -- a good corporation thinks about getting people the right kind of experience and breadth of knowledge so that it has good choices available to it at the time vacancies occur. We all know, I think, that the more you can promote from within, the better that works. It gives good feelings to your employees; they are not expecting people to come in and jump over them -- although there are occasions when the right thing to do is to go outside and bring somebody new in. I was wondering if the minister could talk about what the corporation does in the more general sense.
Hon. G. Clark: I apologize to members. I thought he was sort of talking about the CEO or senior positions. There is a very definite policy of internal hiring at the Ferry Corporation. I've had some discussions with management over the years about that fact. With an aggressive desire to promote people from within the corporation also comes a requirement for -- in my view and I think in the corporation's view -- continual training, upgrading and opportunities for advancement. The corporation has done a pretty good job on that. People in the House with me today would say that we could do better. In fact, for the last year the corporation has been undertaking a very aggressive internal strategic planning process to go along with a capital planning process that looks at the next ten years. The strategic planning focus is highlighting some of the issues that the member is talking about, like how we can do better in terms of promoting from within. Generally speaking, I think that this corporation does as good a job as any in government of promoting, educating and training people and of giving them the opportunity to fulfil their potential. In their recruitment in the early stages, that's clearly one of the things that the corporation looks for.
F. Gingell: Carrying on with the issue of internal management practices, I was wondering if the minister could just advise me what the attitude of the corporation is, what it's doing in the field of setting goals and what the specific
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measurement of the manner in which you're meeting those predetermined goals is -- all of the issues that revolve around value-for-money and the type of things that the Canadian Comprehensive Auditing Foundation is concerned with.
Hon. G. Clark: I'm just going to look at some of the more detailed....
The board of management has hired a Vancouver-based consultant, Michael Sommers of Deloitte and Touche, to help guide the corporation in the next phase of its strategic plan development. About six months ago the corporation embarked upon a major strategic planning exercise, and I think that will be finished in July. They are about halfway through this intense strategic plan.
This phase is defined by the Crown corporations secretariat guidelines on developing strategic plans for all Crowns -- which we have now issued, and that's the impetus for all of this -- as a situation assessment or analysis phase continues the process of implementing some recommendations we had from Mercer Management Consulting for all the Crowns. In July there was a three-daystrategic-direction-and-goal-setting conference that the minister of the day -- which wasn't me -- 35 key stakeholders, the board, management, union and outside agencies engaged in. They've taken that through from July last year. They're now going through another phase and will be finished, I think, in July this year.
Just by way of background, the best strategic plan I've seen in government or any of the Crowns was done by B.C. Rail. The principal author, if you will, or driver was Michael Sommers from Deloitte and Touche. Part of the reason we convinced him to come over, initially for the Transportation Financing Authority and then to work with the Crown corporations secretariat, was to use that as a model in some broader questions. We also hired Mercer Management Consulting to review the planning process at B.C. Ferries, to start to try to get some consistent strategic planning focus for all the Crown corporations.
So we are engaging in some of that exercise. I don't criticize predecessors or previous governments, but none of this was done prior to us coming to office. All those involved in the process feel pretty good about it. It's really helping to focus on strengths and weaknesses and where we need some more work on the corporation.
F. Gingell: The office of the auditor general and the office of the comptroller general have both been encouraging a process to measure and look at the results. A strategic plan is certainly very necessary, and it may well result in your being able to more clearly define your goals and the measurements you can use by which to determine whether you are progressing. But I was more interested in whether the corporation is into the value-for-money-audit mode.
Hon. G. Clark: Sorry, I didn't hear the last part. Just in the general sense, first of all, the internal audit branch of the corporation does do value-for-money audits and has done for some time. But what is supposed to happen and what we're anticipating happening....
After the strategic plan -- which sets the goals, objectives and standards -- is developed, then how do we measure them? The next phase is to have a measurement standard for the value-for-money internal auditing function, which measures how the corporation is doing against the objectives and standards set by the strategic plan. So -- I hope the member agrees -- we're doing exactly what I think the member suggested in terms of trying to move forward. I do want to say the corporation did some value-for-money work inside the corporation prior to us getting elected, so they've done some work.
Just as an aside, the auditor general is looking at doing a value-for-money audit on the Ferry Corporation in several areas. They've had some discussions with the Ferry Corporation about that.
In general, from my narrow preference, it might be better if we could get the value-for-money audit after we get the strategic planning. But that's up to the auditor general. He's certainly looking at whether to pursue it. As you know, he's mentioned several times -- and I'm supportive of this -- following the money and doing something a little more arm's length from government. As I understand it, he's considering the Ferry Corporation as one of the first Crowns he might do a full value-for-money audit on.
A. Warnke: I seek leave for an introduction.
Leave granted.
A. Warnke: Within the precincts visiting us today are 45 students from Lord Byng Elementary School in Steveston. They are accompanied by their teacher, Mr. George Siemens. Would the House please make them most welcome.
F. Gingell: Once the strategic plan is finalized next month and approved by the board, will you table it? Will it become a public document?
Hon. G. Clark: First, sorry if I.... They will be about halfway through in July, so there are a few other steps to go through. I think we will then take it to cabinet and have it approved as the focus of the planning board; and then it will be a public document -- absolutely.
D. Symons: I gather that over the last few years B.C. Ferries has had to borrow money. I'm wondering how much they borrowed last year, and if they're budgeting for borrowing this year.
Hon. G. Clark: The debt of the corporation was about $390 million at the end of last year, of which roughly $70 million, I think, was added last year. Again, it's largely commercial debt, if you will, for a Crown corporation.
D. Symons: I'm wondering if the minister might tell me if there was an operating debt last year that had to be financed.
Hon. G. Clark: Yes. There was a $21 million operating loss last year.
D. Symons: That's quite a large number that obviously wasn't appropriately budgeted for. Over the last few years the salaries and wages component of the operating budget seems to have gone up substantially. I'm wondering if the minister might give us some explanation as to why salaries and wages seem to have increased dramatically.
Hon. G. Clark: This corporation has seen really quite phenomenal traffic growth. Anyone on Vancouver Island can see the population growth. In fact, traffic growth in the corporation has been growing about 5 percent a year for about the last four or five years. Our wage bill doesn't go up as fast as our traffic growth, but certainly some of the wage bill goes up with it, particularly with respect to the superferries.
[12:00]
[ Page 12090 ]
As you know, the superferries are huge ships, and they increase the operating costs of the corporation. It's an interesting dilemma for a monopoly Crown Corporation, in some respects. If you put on a superferry, it dramatically improves service, but it doesn't.... I guess what I'm getting at is that a certain volume of traffic goes across anyways. If it takes a three-sailing wait, they still get across at the end of the day. If you improve service, you don't necessarily increase your market; you simply take the people faster. In some respects, the economics are a little tricky in that regard. The more you increase capacity, the better able you are to service people, but you don't necessarily carry more at the end of the day; it just means that the lineups are shorter. While our traffic is growing, the ships have really been improving their service, but the costs associated with those ships have been growing a little faster.
[G. Brewin in the chair.]
The wage bill of the corporation generally is a result of the contracted settlements. It's been actually quite good, I would say -- advisedly. The last collective agreement -- which, unfortunately, has now expired, or is about to expire -- was 2 percent and 2 percent, which, in today's environment, may seem to be a bit higher than the current settlements, but I think it was a very reasonable settlement at the time by the corporation. In fact, it helped the government, generally, in its overall planning. We were coming off some very high settlements by the previous government -- 7 percent, on average -- and there was a tail coming through the system. Members may recall that the Ferry Corporation and the Transit Corporation both settled for 2 and 2 -- although the Transit Corporation settled for 2, 2 and 2 over three years, and B.C. Ferries settled for 2 and 2. They're currently expiring.
The wage bill as a result of the wage increases has been moderate, but there has been some increased pressure on the corporation on the staffing side because of the tremendous growth in demand. It has also increased revenues, of course. I just got a note that wages are 66 percent of expenditures.
D. Symons: Last year we learned that due to an operating deficit, the shareholders' equity decreased by $15.8 million between the 1991-92 fiscal year and the 1992-93 fiscal year. I'm wondering what the effect was on the shareholders' equity for the '93-94 fiscal year, between the 1992-93 fiscal year and the 1993-94 fiscal year.
Hon. G. Clark: I guess it has gone down by $28 million. It's a $21 million loss and a $7 million Workers' Compensation levy.
D. Symons: The Workers' Compensation Board levy of $7 million is quite a bite.
Hon. G. Clark: That's outstanding liability.
D. Symons: I wonder if you might give us the total wage costs, then. You mentioned that it was 66 percent of your operating costs. Could you give us a figure for the total wage costs for the past fiscal year?
Hon. G. Clark: It was $194 million.
D. Symons: Going back to salaries and staffing, I wonder if you might tell us how many more personnel it takes to operate the superferry than the ferries that were in operation across the strait before. My question relates to the fact that you commented on the superferries and more staffing. I note that the frequency of service seems to be down somewhat. Last year at this time, you had a run at 8 o'clock in the morning, but that run is no longer there. So, in a sense, you have less frequent service for much of the year. Because those services aren't there, there is a saving in personnel, so with the increased number needed on the superferries, it might balance out. I'm not sure whether you have more full-time-equivalents. That would be my other question. If you don't have the number today, maybe later on you could pass along the number of full-time-equivalents you've had in the Ferry Corporation over the past three years.
Hon. G. Clark: The first one is easier. The V-class ship, which is the next largest, has about 39 personnel on it. The S-class ships, the superferries, have 51 at maximum licence level, at full capacity. The S-class ships carry 40 percent more people and cars than the V-class.
In the winter months, there has been some shifting of service to try to match it better with the demand, and there are some savings. We can also reduce the crewing on some of the vessels, because they won't be at maximum capacity. We don't require 51 unless they're running at maximum capacity. A lot of these are Coast Guard regulations and other regulations. Also, we enhanced the service significantly on route 30. That's a fairly new thing, as you know, the Mid-Island Express. I'll say to the member that we looked at the possibility of reducing dramatically the service this winter on route 30, because we're getting into an area where we're looking at trying to save some money. But the judgment was made -- and the corporation and I agree with this -- that route 30 is growing significantly and steadily; it's the fastest-growing route. So from a business point of view, while we could have reduced service and possibly accommodated the traffic, we wanted to maintain the service to continue to grow with the traffic, so we'd get some more revenue where there is increased capacity. I think those may be some of the reasons why the personnel savings in the winter weren't as high as we'd like.
It's an interesting debate from a public policy perspective because there's no magic in reducing costs at the Ferry Corporation; we simply reduce service. Obviously the purpose of the corporation is to provide service, and many of the tough decisions in the Ferry Corporation, if you look ahead, are dealing with questions about some of the services we provide. Saltspring Island is a good example of that. I'm probably wandering into territory that I don't need to today, but there are three terminals on Saltspring Island. From any private sector point of view, or certainly any business perspective, one could argue that that's extraordinarily inefficient -- although it's a level of service that people on the islands have come to expect. The corporation has provided it as a matter of public policy, and there's a very large subsidy attached to it.
So when we look at how we can reduce costs -- and we've been trying to do that -- and improve service to deal with this dramatic growth, all of these questions involve tough calls. The subsidy has been reduced, and we've been trying to balance it, but there are three or four things: raise fares, dramatically reduce service or reconfigure routes and some other things to try to accomplish some goals. The wage bill is another one in terms of the associated costs.
D. Symons: Yes, I agree with what you were saying regarding the Mid-Island Express, because I think that's a valuable route and worth building up -- so no problem at all
[ Page 12091 ]
in keeping the service on that. I know there was a bit of a kerfuffle over the fact that you were going to reduce service and then decided to maintain the service on that route.
I'm wondering if you might give me just a general feeling -- not to the man, or to the person, I guess I should say, to be politically correct -- for the fact that you have reduced the frequency of service on route 1, now that you have the superferries. You're not running the 8 a.m. ferry that you were running a year ago. Taking into account the fact that you have larger ships with more personnel versus the smaller ships, does it balance out pretty well for the number of full-time-equivalents for that particular service? In other words, is having the superferries really costing more for personnel in the long run, or does it balance out fairly well?
Hon. G. Clark: No, it balances out. Service has not been reduced on route 1; it's been increased with the advent of the superferries. But you're talking about frequency of service. From time to time they used to be able to have three V-classes, compared to which the two S-classes now have significantly more capacity. What we've really done is shifted the crews. There used to be three crews on the V-class. There are now two crews on the S-class, and they almost balance out exactly.
F. Gingell: When can we expect the financial statements for the year ended March 31, 1994?
Hon. G. Clark: I'm advised that they will be tabled in the House on June 29.
F. Gingell: You mentioned a $7 million Workers' Compensation Board assessment. Well, the liability rises because of the assessment. You mentioned it as a separate item, adding it onto the $21 million operating loss. Is that because this $7 million assessment arises from the accidents that happened in the earlier years, or is this $7 million just a normal operating cost for this current year?
Hon. G. Clark: It's from prior years; it's an accumulation, if you will. The auditor general -- I guess the member probably knows this, but I wasn't aware -- is requiring us to book that liability. So that's new. We've never done that in the past, so that's why advice from staff is that we show it as.... My staff advises me that we are contesting the amount vigorously, but there has been an assessment based on the previous years, on many years past. We've been hit with this significant assessment, and the auditor general is asking us, or requiring us, to book it.
F. Gingell: So am I correct in understanding that the B.C. Ferry Corporation, because it is the only corporation in the province in this particular business, has its ownclassification? This particular group has had this assessment, and the assessment is based on history -- i.e., the employer in the end pays all the costs of the claims, and this assessment arises specifically because of claims and liabilities far in excess of the amounts you've been assessed on an annual basis for the purposes of the coverage.
Hon. G. Clark: My understanding is that that's correct.
F. Gingell: Does this give the Ferry Corporation any message about its safety practices?
Hon. G. Clark: First of all, I'd say that the Ferry Corporation is contesting the assessment.
I don't know if members are familiar with Admiral Martin's background, but before he was appointed to this current position, he was specifically hired to deal with safety considerations, in part arising from the tragedy in Nanaimo, which was not an employee accident. We've done a full safety audit of the corporation. Mr. Martin was responsible for that and continues to pursue it very vigorously to try to revisit and reanalyze the safety ethic of the corporation. I just want to say, however, that the corporation has a very good safety record, albeit with a very serious accident in Nanaimo -- an excellent safety record generally and, I think, from a workplace perspective a reasonably good safety record as well. Like all corporations over time, when things are going and you're doing well and there's pressure to move the boats out, etc., what we found, and what Justice Nemetz found, was a bit of lack of attention to reviewing those things; it was always the way things had been done.
We have undertaken some significant steps, in terms of safety for passengers, loading and unloading, and also for the corporation -- occupational health and safety is a high priority. The union is very militant in this regard, and from time to time -- if you follow British Columbia public policy -- I think you'll see the union being aggressive on the safety questions. Sometimes I don't agree with them. Staffing is higher than it is in other jurisdictions, and the union does a fairly good job of persuading the public that those are required. Not everybody agrees with that, but that's been the source of some contention.
[12:15]
The assessment by the WCB is being contested. I think it's fair to say that in general, and in the last couple of years in particular, there has been a real emphasis by the corporation on trying to revisit the way we do business, not just to make sure that we improve service but to give comfort to the public and the employees that safety matters are of the highest priority with the corporation.
F. Gingell: I would presume that the Workers' Compensation Board assessment in fact has nothing to do with the Nanaimo incident. Obviously, if there is an assessment coming.... There has been a history of claims far in excess of standards. It must also mean there has been a substantial increase in the amount of moneys the Workers' Compensation Board has paid out. In reviewing this whole issue, is the corporation contesting this assessment on the basis that the Workers' Compensation Board has been paying out things they shouldn't have been? I'm having a bit of a problem understanding how the $7 million arises.
Hon. G. Clark: The corporation's view is that the WCB has not demonstrated to us where the number arises from, that the criteria they have used are acceptable, so we are engaging in a dialogue. I want to be careful here. The WCB is saying they think the future liability will be $7 million. They think the corporation should book $7 million as a contingency, if you will, against what they project to be future liabilities, based on what they say is past practice. There are a lot of assumptions in any of this modelling, and other corporations have concerns about it as well. So we are asking them to demonstrate what they think the past practice and the criteria they used to analyze the costs associated with past practice were, and how they project it forward and say the corporation should accept liability. My staff say they would be happy to give you a detailed briefing on the question.
This is fairly recent. We have just been hit with this, and we're questioning it. Staff feel very strongly that they don't accept the rather arbitrary nature of it. It is a bit
[ Page 12092 ]
compounded by the fact that the auditor general -- and I don't necessarily disagree with this -- is requiring the corporation to book this liability, for the first time ever. That's fair enough, but it has drawn attention to it. One shouldn't infer from that that the corporation has a bad safety record. I don't think you can do that at all, and I wouldn't accept that.
F. Gingell: Mr. Minister, can you tell me how much your normal annual WCB bill is?
Hon. G. Clark: One point one million dollars.
F. Gingell: This is a large amount. Have all claims been settled with respect to the accident in Nanaimo and the other accident?
Hon. G. Clark: No, we have not settled all the claims.
F. Gingell: In these numbers, though, one would presume that provision has been made for what management believes to be a reasonable amount.
Hon. G. Clark: Provision has been made, but the majority is paid for by insurance. So not much is required.
F. Gingell: That actually dealt with my next question. So the Ferry Corporation does carry liability insurance, whereas government doesn't, Mr. Minister?
Hon. G. Clark: That is correct; the government is self-insured. There was a risk assessment branch in the Ministry of Finance in the eighties. This particular Crown corporation is not self-insured, nor is it part of the government's self-insurance scheme. It has its own private liability insurance.
F. Gingell: Just going back to an earlier answer, when the member for Richmond Centre was talking about wage costs, you said that your wage costs have stayed in line with your increases in toll revenues; but between the years 1992 and 1993, your wage costs went up $21 million, which was an increase of about 14 percent, whereas your toll revenues only went up $12 million, which was an increase of 6 percent. In the next year, your wage costs went up roughly $9 million. I presume from what you said that your toll revenues have gone up about $10 million and a fraction. Basically, in this last year, from the rough numbers we've had, it would sound as though all of the increase in toll revenues has gone to pay additional wages to balance that. Is that correct?
Hon. G. Clark: First of all, revenue has gone up by over $30 million....
Interjection.
Hon. G. Clark: It's not all toll revenue, though. We've been trying hard -- and this is something I've been pursuing for two and a half years -- to get the corporation to not just look at toll revenue but other sources of revenue. The revenue from the bookstore is up significantly. The revenue from cappuccinos and catering is up significantly. The bulk of it is toll revenue, but not all of it.
I just want to advise the member that you're correct that there is some increase in the wage bill; those numbers are correct. The principal reason for that is there is now a second ship on route 30, which we talked about a minute ago. There are the S-class ferries which have more staffing requirements. There was increased staff associated with the safety initiatives around the Nemetz inquiry; Admiral Martin's safety division was set up. And there's the ongoing improvement of service. There have been some increased costs, and we're certainly alerted to them, but they're largely the result of improving service. The total tariff revenue increase was 11.6 percent; the total increase in revenue from catering was 15.8 percent. Then there were some rather large increases in parking and assured loading. As you will recall, we separate those as well. There was about a 20 percent increase, although there's not as much revenue.
F. Gingell: The minister advised us that for last year, before the WCB issue, he had an operating loss of $21 million. Could he advise the committee what the original operating plan or budget was?
Hon. G. Clark: That's a good question. We were almost right on with our projection. We have $12 million more in revenue than we projected, and about $4.5 million more in expenditures than projected. So we're about $7 million better off than we projected in the corporation's budget. The main reason for that, by the way, is growth in traffic.
Historically, there has been about a 2 percent growth in traffic -- since 1961, or whatever. In the last four years it's been averaging 4 percent a year. So when we budget -- this is particularly useful when you're appearing before Treasury Board -- we always budget for a 2 percent increase in traffic growth, because that's been the historical pattern.
Interjection.
Hon. G. Clark: They're telling me not to tell anybody. In the last three or four years it's been significantly higher than that. If that continues -- and we're not counting on it -- the corporation will be in extremely good financial shape in a very short period of time, although there are some cost pressures associated with that. I think 40 percent of the fleet was built in about a two- or three-year period in the early 1960s. There hasn't been an orderly replacement program and the capital stock is deteriorating. So those are cost pressures. This corporation's prospects are very good, in large measure because it's a monopoly Crown corporation in a rapidly growing environment. From a fiscal point of view, even though there are a lot of pressures and some capital costs in bringing on new ships, etc., it's in an enviable position relative to other Crown corporations or other businesses in the province. The ferry rates are the lowest in the world, so that's another consideration.
I think I'll just conclude for today. Or maybe we can take a few more questions, if people are keen to continue.
We also receive $18 million a year from the federal government in subsidies for the northern service. That $18 million a year goes into general revenue -- it does not go to the corporation -- and the corporation receives a subsidy. This year the subsidy from the provincial government was over $30 million. Notionally, it is useful to disaggregate that and say that $18 million of the $35 million is from the federal government for northern routes, and the remainder is the provincial subsidy for the service it provides and to discount the prices lower than they would be in the private sector.
F. Gingell: My next question was going to be what this year's operating grant is, because that's the other number
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that one needs to put this.... We will have it all on June 29, but we can't wait that long.
The operating grant goes up and down. It went from $28 million in '92 up to $41.3 million, and now is down to $35.6 million. Why is this? I appreciate that the note speaks to certain things, but it doesn't indicate in this note that there is some methodology by which you arrive at this grant. I'm wondering why the grant was $35 million and you had originally budgeted to have a loss of about $28 million in addition.
Hon. G. Clark: It's important to distinguish between the operating subsidy and the subsidy received from Treasury Board. The operating loss is the loss every year, plus the debt service associated with it -- and that goes up and down based on revenue, the wage bill and all the other factors. That's why the operating subsidy is just that. Treasury Board gives us a subsidy, which has been declining every year for the last three years.
[12:30]
Interjection.
Hon. G. Clark: The actual Treasury Board submission, yes. When we took office, it went up. Maybe the member is referring to the estimates; I don't know.
When the previous administration launched the superferry replacement program, there was a pretty big increase in the subsidy to help the corporation. It was a capital subsidy. Since that time, the corporation has been receiving steadily reduced subsidies. It still has the costs associated with some of the superferries -- some of the costs we talked about earlier. So the operating subsidy varies based on those combinations of factors each year.
A. Hagen: I would like to ask leave to make an introduction.
Leave granted.
A. Hagen: Joining us in these last few minutes of our session this week are 42 students from Lord Kelvin Elementary School in New Westminster. They are with their teacher, Mr. Wright, and parent chaperons. I might note for the MLAs in the chamber that this is an annual visit this school makes to the precincts. I'm very happy to welcome them again this year and ask you to join me in that welcome.
Hon. G. Clark: We've had a nice start on the Ferry Corporation. I move the committee rise, report progress and ask leave to sit again.
Motion approved.
The House resumed; D. Lovick in the chair.
Committee of Supply B, having reported progress, was granted leave to sit again.
Hon. G. Clark: I wish everyone a restful weekend, and with that, I move this House do now adjourn.
Motion approved.
The House adjourned at 12:31 p.m.
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