[ Page 529 ]

The House met at 2:05 p.m.

M. de Jong: The member for Abbotsford and I are very pleased that there are five representatives from the Dasmesh Indo-Canadian Senior Citizens Association present in the gallery this afternoon: Hardev Singh Sidhu, Dalip Singh Gill, Sawa Singh Bariea, Gurmeet Singh Tiwana and Bhadat Singh Bhatti. I hope all members will join the member for Abbotsford and myself in making them welcome.

Hon. M. Sihota: Beaten to the punch by that cagey member for Matsqui. Let me also extend on behalf of our caucus, my colleague the Attorney General and the member for Yale-Lillooet, in particular, and of course the member for Okanagan West, a warm welcome to our colleagues from the Dasmesh Punjabi School in Matsqui.

M. Coell: In the House today are friends of mine, Buncy and Raj Pagely. They are cross-cultural consultants working on educational programs on heart disease with the South Asian and multicultural communities in British Columbia. Would the House please make them welcome.

Hon. S. Hammell: In the House are two people from the Surrey area. One gentleman's name is Amrik Sanghar and the other is Andy Aadmi. Would the House please make them welcome.

Introduction of Bills

Hon. D. Zirnhelt presented a message from His Honour the Lieutenant-Governor: a bill intituled BC Forest Renewal Amendment Act, 1996.

Hon. D. Zirnhelt: It's my pleasure to introduce Bill 12, the BC Forest Renewal Amendment Act, 1996. The government introduced the BC Forest Renewal Act in 1994, and it was to enhance the productive capacity and environmental value of forest lands, to create jobs, to provide training for forest workers and to strengthen communities.

The bill I am presenting today makes amendments to that legislation that will provide additional assistance and support to displaced or underemployed forest workers. Bill 12 will give displaced forest workers first-priority hiring on Forest Renewal B.C. projects. It also provides for the establishment of an agency to match eligible British Columbia forest workers with jobs on projects funded by Forest Renewal B.C. Bill 12 strengthens this government's commitment to forest workers and their families and communities, and it builds on our experience supporting forest workers in Forest Renewal B.C.'s first two years of operation.

In that time, Forest Renewal B.C. has spent some $200 million on a wide range of projects in every region of the province and on all the spending priorities in the forest renewal plan. These priorities are investing in the productive capacity and environmental values of our forests, in securing a good future for forest workers and creating new jobs, and ensuring stability for communities that rely on our forests. In each of these areas, Forest Renewal B.C. is continuing to develop and implement effective and innovative programs to renew the forest sector in partnerships with workers, industry, environmental groups, communities and first nations.

I move that Bill 12 be placed on orders of the day for second reading at the next sitting of the House after today.

Motion approved.

Bill 12 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

G. Campbell: Last year the Minister of Finance reported to this House that it was understood in the first two years or so that more money would be coming into Forest Renewal B.C. than going out of it. The NDP bragged about a $2 billion trust that would be set aside as a kind of trust for forest-dependent communities and forest-dependent families across the province. Yesterday, the Premier announced: "It was never the intent. . .to have money in the bank." My question is to the Minister of Finance. Before the election, there was supposed to be a $2 billion trust built up in Forest Renewal. Why is it that the minister is so intent today on pillaging the forest renewal fund, if not simply to cover up his own incompetence?

Hon. A. Petter: I very much appreciate the question. The purpose of the forest renewal plan always had been to establish a dedicated fund that would establish a constant flow of revenue over time and, yes, have a reserve fund that would enable it to do that during downturns in the economy. What has happened over the last number of years is that the rate of expenditure has been lower than anticipated and the revenues have been higher than anticipated in the original plans.

Those basic commitments of a dedicated revenue flow, of constant investment and of a reserve component are the key elements of the plan that this government remains committed to. They are the key elements that will ensure that we will build on the investment of $145 million that took place last year, increase that investment this year under Forest Renewal and build up to that constant flow of investment over the remaining term of this government, and hopefully beyond. [Applause.]

G. Campbell: I'm amazed at the members opposite for applauding that kind of a response. The members opposite do know what they campaigned on and what Forest Renewal was supposed to be about. In fact, the member for Skeena was really quite eloquent about the importance of Forest Renewal. The member for Skeena said specifically: "We'll take $2 billion over the next five years -- that's $2 billion of additional stumpage, so it's not tax money. . .so it can't be claimed or clawed back in future years just because there's an election call" -- just for political expedience. My question is to the Minister of Forests. The member for Skeena and many members opposite speak for resource-dependent communities. When will the Minister of Forests stand up and speak for resource-dependent communities instead of selling them out?

Hon. D. Zirnhelt: This is the Leader of the Opposition that says: "Not only is Forest Renewal bad for business, it's bad for the workers of British Columbia."

[ Page 530 ]

The question is: will we honour the commitment to reinvest in the forest land base, the communities and the workers? I say to you that the business plan for Forest Renewal must do that.

[2:15]

G. Campbell: The Minister of Forests does not understand the question that people across the province and people in his own constituency are asking: when is he going to stand up for those communities instead of selling them out? That's the question the people are asking themselves. The Premier today has said that that's government money. It is not government money; it's money for the forest-dependent communities and the forest-dependent families -- for families in that minister's riding and in ridings across this province. When will the Minister of Forests stand up for those families and those communities and tell the Minister of Finance to keep his grubby hands off Forest Renewal funds?

Hon. D. Zirnhelt: If the hon. Leader of the Opposition had read the paper today, he would know that we expect forest jobs to grow in British Columbia. If he looked at the spending projections for Forest Renewal B.C., he would also know that in the forest-dependent community of West Vancouver-Garibaldi, last year's target was $300,000. This year -- '95-96 -- $2,200,000 was spent in that forest-dependent community; for '96-97, $4,427,000; and in Cariboo North. . . .

Interjection.

Hon. D. Zirnhelt: Sounds to me like the member from that riding doesn't want the money spent there.

This Minister of Forests is standing up for the forest communities by ensuring that there will be no cuts to the program funding of Forest Renewal B.C. In fact, every year until we reach the $400 million target, it will increase. But it will only increase as we can spend it wisely.

J. Wilson: My question is to the Minister of Forests. I am from a riding that depends on forestry. The people of the Cariboo have paid millions of their dollars into the Forest Renewal fund, and now Forest Renewal is being threatened by this government. The people in the Cariboo gave that money to be used to ensure the future of their community. Will the minister promise that the money that came out of their forests will go back into their forests?

Hon. D. Zirnhelt: I can assure the member, whose riding will be getting about $7 million this year and $8 million next year -- it's growing every year -- that the dollars will increase in that and every riding until we reach our target. There will be no money taken back. Further, that member must know that, independent of Forest Renewal but based on the confidence of the forest industry in this province, a new MDF plant has been created there, creating 110 jobs for the forest industry -- your riding.

Interjections.

The Speaker: Order, please.

J. Wilson: That money came from the Cariboo and was supposed to go back to the Cariboo. That money was given to this government by these people, to be held in trust. It is a trust fund for the future of the forest and forest communities. Will the Minister of Forests promise today that the money that came out of rural B.C. will go back to rural B.C.? Is this just one more broken promise, one more betrayal of trust?

Hon. D. Zirnhelt: There will be jobs created in the Cariboo this year -- hundreds of jobs -- and that member's riding will get its fair share. The money that is raised is going to go back -- as we can spend it appropriately. What the member fails to understand is that there is a program continuity fund -- a cushion, if you will -- that has been planned into the Forest Renewal business plan. It was in last year's business plan, and I trust it will be in this business plan this year to ensure that there is no drop-off -- in fact, a continued ramping-up -- of expenditures in Forest Renewal B.C. That party over there has the gall to criticize this program. They voted against it when it was here in the House. They had their chance.

M. de Jong: My question is also to the Minister of Forests, who on Monday refused to answer some very specific questions relating to his government's designs on Forest Renewal dollars. He sat by silently, idly, while the Finance minister avoided, evaded and denied allegations for three days about his government's proposal to plunder Forest Renewal dollars -- allegations that the Forests minister himself admitted were true yesterday. He calls himself the straight shooter from the Cariboo. Let's have some straight answers from the minister.

The Speaker: Let's have a question.

M. de Jong: When was the issue of transferring Forest Renewal dollars to general revenues first discussed by the Forest Renewal board?

Hon. D. Zirnhelt: One of the problems is that when members from the other side. . . .

Interjections.

Hon. D. Zirnhelt: I'm not given to drama like the member on the other side is, so I'd like to calmly explain what happened. . . .

Interjections.

M. de Jong: The Forests minister admitted yesterday that he made the pitch for Forest Renewal dollars. He made that pitch. Presumably he didn't do it of his own volition; presumably someone suggested to him that that was what the government wanted to have happen. So my very straightforward question to the Minister of Forests is: who approached him from the Premier's Office or the Finance ministry with the suggestion that the government wanted access to those Forest Renewal revenues? Who approached him, and when was that approach made?

Hon. D. Zirnhelt: I want to explain in a very forthright way that sometimes the opposition probes with its questions and doesn't really get at the real issues. The real issue from yesterday's discussion. . . .

Interjection.

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Hon. D. Zirnhelt: These members aren't taking this from what I said, but from what I was quoted to have said. I have never. . . .

Interjections.

The Speaker: Hon. members, the entire question period will disappear if we don't allow people to hear each other.

Hon. D. Zirnhelt: The board of Forest Renewal B.C. did discuss the matter of surpluses, and everything else I said they discussed, at its last meeting. They said that they have directed staff to come up with options as to what to do with the surplus funds.

G. Wilson: My question is to the Minister of Environment, Lands and Parks. The Sookinchute Utility Corporation is a licensed utility corporation in Westbank and Kelowna. Currently, it would appear that it has unauthorized use of water systems and that this is impeding the water that may be necessary for fire protection in that area. It is my understanding that the minister and his staff have made available information with respect to Sookinchute. I wonder if the minister can tell us what steps this government is taking to act immediately to mitigate potential criminal liability that may be placed in the event fire takes place and no fire flows are available to fight those fires in the residential developments.

Hon. P. Ramsey: The water comptroller's office has advised me that the plans for the system indicate that it has sufficient capacity to provide for all residential requirements of those who are serviced by the system. There are more than adequate supplies to deal with any fire that might arise. I'd be pleased to have the member fully briefed by members of my staff.

The Speaker: The bell terminates question period.

The member for Alberni on a point of order.

G. Janssen: I didn't want to interrupt the lively proceedings at question period, but during question period the Leader of the Opposition made what we on this side of the House feel were offensive remarks to the Minister of Forests -- i.e., "grubby hands" -- and we would ask that he withdraw.

G. Farrell-Collins: If the member checks the record, he will see that that allegation was not made to the Minister of Forests.

Hon. D. Streifel: I have the honour today to present two reports: the Ministry of Social Services '93-94 annual report and the report of the Gove inquiry into child protection.

Hon. M. Sihota: I have the privilege to present to the Legislature the annual report of the Workers' Compensation Board of British Columbia for the year 1995. I also present the workers' compensation statistics. This is a supplement to the annual report for the year 1995.

Hon. D. Miller: It's a trifle early, but I have the honour to present the 1994-95 report of the Ministry of Small Business, Tourism and Culture.

Petitions

J. Kwan: I'd like to ask leave of the House to table a 2,693-name petition regarding the ward system in the city of Vancouver.

The Speaker: You've heard the intent of the petition. Shall leave be granted?

Leave granted.

Orders of the Day

Hon. J. MacPhail: In Committee A, I call Committee of Supply to hear the estimates of the Attorney General. In this chamber, I call Committee of the Whole to continue to debate Bill 2.

[2:30]

The House in committee on Bill 2; G. Brewin in the chair.

Section 4 approved.

On section 5.

F. Gingell: As we are aware, section 5 deals with the issue of transferring one more cent per litre on gasoline and fuel taxes from the consolidated revenue fund to the Transportation Financing Authority -- estimated, I believe, to produce about $60 million a year. Perhaps the minister could confirm that. The real issue that I'd like to ask the minister about is when it is intended that this will become effective.

Hon. A. Petter: I'm informed the amount is around $55 million a year. The intention is to make this effective at the time that it is necessary to make it effective. With our freeze on uncommitted capital, that may mean it will be later in the year, rather than earlier. Of course, one of the goals of that freeze, of this government and of myself as Finance minister is to try to reduce our capital expenditures and the associated costs of servicing that capital and debt. So we may be able, in this case, to delay the transfer until sometime later in this year. I won't be able to give a clear answer until we have the outcome of the capital review and know a bit better what kinds of demands that will place upon the TFA.

F. Gingell: I must admit the response surprised me. I don't have with me a copy of the budget report. But in the budget reports, if you turn to the schedule at the back, it will show the balance that was anticipated to be owing on the TFA for contracts presently under construction. There is a debt table there at the back. It's something like $382 million. You go to the column on the right-hand side.

Interjection.

F. Gingell: It's $590 million. That sounds right. So at the moment, with the projects that are on and the. . . . Sorry, I've got the wrong one. . . .

[ Page 532 ]

Hon. A. Petter: To assist the member, I am informed that it is the difference between these two numbers in table G7. I think that difference is $392 million, but in fact, they expect to spend in the range of $350 million before the freeze.

F. Gingell: But there are a whole series of projects that have already been started, like the Island Highway. You're not freezing the Island Highway project. In the parts where the contract has been given, the contract is carrying on. I remember the number of $390 million as being what you believed the debt would be at March 31, 1996. That's going to be back to $350 million. But it's clearly going to get above that.

At the moment, what you have is $55 million a year in revenue coming from the present one-cent-a-litre gas tax and roughly $15 million a year coming from the tax on short-term automobile rentals. I'd like to suggest to the minister that to suggest that you would delay putting this extra one cent a litre in to service this very large debt is a very weak excuse.

I'm concerned about the commitments that this government makes about specific issues -- and then, of course, they turn around and say that we were against them. Rightly or wrongly, you commit revenues to service these debts that are incurred and you play around with them.

If you intend to put an extra cent in, let's put it in. Make it effective April 1, at the beginning of the fiscal year. We get suspicious on this side of the House -- and I'm sure the people do -- that you're thinking of delaying putting this money in in an attempt to balance this year's budget. You've clearly got budget-balancing problems and to be able to add roughly $5 million a month for every month you delay is going to be helpful.

If you've got $350 million worth of debt, you've got all kinds of projects going on that are not affected by the freeze. You clearly need those additional funds in the TFA. I'm disappointed that you're waffling about the issue.

Hon. A. Petter: Well, I thought the member didn't believe in warehousing, but apparently he does. Let me assure the member that the moment the Transportation Financing Authority inform us that they require this revenue stream to fund their capital expenditures, it will be transferred. To transfer it earlier would be a form of warehousing, in a sense. Why do that when that revenue can assist in other laudable and important objectives? Indeed, I've always thought the member wanted us to reduce capital expenditures and debt in order to enable the province to lower debt-servicing charges. In a sense, this is doing that by not requiring the transfer of this dedicated amount for covering debt until a later date than the member seems to suggest.

F. Gingell: Well, I was going to allow sections 5, 6, 7 and 8 to pass, but. . . .

Someone called Peter should know that there's this famous role about Peter and Paul: you must not rob Peter to pay Paul. And we certainly must not rob the TFA to give money to Peter. The important thing with your debt is to pay it off as reasonably and as quickly as you can. The more money you put into the TFA, the quicker you will retire that debt and the less amount of money you need to borrow there.

You've carefully pulled these highway infrastructure capital costs out of the consolidated revenue fund so that you don't have to include them in your calculation of the deficit. It seems to me that this is tax-supported debt. Let's get it paid off as quickly as we can.

Hon. A. Petter: I sure don't want to prolong this discussion for the member, but the period for retiring the debt is determined by the amortization period for the assets, not by how much money we give to the TFA from time to time. My name is not Peter, but if it were, I would not feel robbed in the slightest. All we're saying is that we're going to give this funding to Paul -- the Transportation Financing Authority -- just as soon as Paul requires it for the laudable purposes that Paul does. But in the meantime, let's not give it to Paul ahead of time and allow Paul to -- I don't want to say, it because the member may get agitated -- warehouse it.

Sections 5 to 8 inclusive approved.

F. Gingell: Just one comment. It seems to me that you have a clear idea at the moment of which properties you are going to prescribe to be allowed to be exempt from municipal taxation for the purposes of local airports. Rather than have these things prescribed by order-in-council, wouldn't it be better to describe them within the act? Then people on local airport authority boards and local municipal councils would clearly understand what the rules are, and they wouldn't be subject to change at the whim of the Lieutenant-Governor-in-Council.

Hon. A. Petter: I'm informed that the reason for this has to do with the fact that airport authorities have within their property holdings a variety of different kinds of property. Some may be what we would consider airport property. Others may be property that's developable for residential purposes and it would not be suitable or appropriate to impose this kind of dispensation upon. Each one is so different that the feeling is that if we try to anticipate every circumstance we would inevitably miss some. So, the better course of action -- the purpose is clear here -- is to try to place these airport authorities and the local authorities that run them in the same kind of position, no worse position than they would have been under the federal regime. But we also want to make sure they're in no better position either, and that properties that should attract taxation do so. In this case, some latitude is thought necessary as we work through this with the various authorities to achieve the clearly desired and understood objective.

Sections 9 and 10 approved.

F. Gingell: Could the minister please give us some idea of the scope -- the size of the problem that has caused them to bring in these rather complex rules dealing with associated corporations and subsequent amalgamations for the purposes of avoiding property transfer tax?

Hon. A. Petter: I don't have an aggregate number, but I can tell the member that there was one transaction that was detected recently in the range of $900,000 and one close to $2 million. The concern here is that this is becoming a known and a growing form of tax avoidance, and we want to make sure we nip it in the bud.

Section 11 approved.

On section 12.

F. Gingell: Every year as we gradually push these exemptions up, I take the opportunity to remind the minister -- now we have a new minister -- to look back at the original 

[ Page 533 ]

provisions that created the property transfer tax exemptions. I think they were a better set of rules than you have now. They didn't impede the natural movement of young families early in their married life, quickly moving up from one. . . . They go and buy a condo which is a one-bedroom unit, and they get a little bit more money and maybe get a two-bedroom unit. Then they start a family, and they're moving up into bigger units. It was felt on this side of the House that the previous exemptions worked better than this set of rules does.

[2:45]

Hon. A. Petter: This is an issue that maybe the member and I could have a coffee over sometime, and he could tell me why, in more detail, he thinks the previous regime was preferable. This, obviously, was a commitment this government made in the 1991 election that we lived up to.

In terms of the dollar value, certainly it seems to provide a greater value, about twice the value -- from $12.7 million, I think, in the last year of the previous high-ratio-financing tax relief program the member opposite is referring to. . . . This year, as I understand it, the benefit or cost to government of this expenditure is about $25 million. Obviously the member has concerns about the distributional impacts, and I'm happy to pursue those with him and learn more about his concerns.

Sections 12 to 14 inclusive approved.

On section 15.

F. Gingell: Perhaps we could deal with sections 15, 16, 17 and 18 all at the same time.

I spoke to the minister earlier about a concern I had when one single owner switched a prototype property from research and demonstration to commercial use. I would be interested in the answer to that conundrum.

Hon. A. Petter: We may have to discuss this one over coffee, too, hon. Chair.

As I understand it from staff, the situation is as follows. I think the first part will correspond with what I thought was the understanding I had of it earlier, and that is that where a prototype is sold from one individual to another, then the tax is payable on the purchase price -- the market value. I understand that as the bill is now crafted, where it is not sold and the prototype then becomes used for a commercial purpose and becomes therefore taxable, the tax is on the value of the component parts.

The member and I had an interesting discussion about this, and I guess the question was: would the market price be the fair result? I think the member and I were both assuming that the market price might be lower than the value of the component parts. In fact, I think I recall the member suggesting that might be case. Staff inform me that it is their expectation, based on their understanding, that for the most part that will not be the case. The value of labour will not be accommodated in this price. In other words, the components of the parts attach a value which excludes the value of the applied labour and intellectual knowledge, etc., that brought those parts into a prototype. For that reason the choice was for the parts, assuming that would tend to be a lower, fairer and more equitable value. That, as I understand it, is the legislation as now drafted.

F. Gingell: No transfer of ownership has taken place. So if this was not a demonstration plant that had been built as a commercial plant by the company to start with, there wouldn't be any tax on the labour anyway.

Hon. A. Petter: In the situation the member posits, the tax would have been paid initially on the parts that were acquired. Once those parts were built into a component asset with the applied labour, that asset with the incremental value of that labour would then become subject to other forms of taxation.

F. Gingell: I've been out of the business for 25 years. Things have changed. I'm surprised things have now become such that if a company builds its own particular process equipment that will be used in manufacturing, it pays tax on other than the tangible personal property. . . .

Hon. A. Petter: And it sells the asset.

F. Gingell: No, no. When it's building it for itself. I'm not talking about transfers; we've already dealt with transfers.

Hon. A. Petter: The second tax I was referring to is when that asset goes into the marketplace and gets sold. The value at which it is sold will include the incremental value of the labour that enhanced the value of that asset in the marketplace. That's the only point I was trying to make.

F. Gingell: I see. I take it the minister is saying that the fact is that we may charge tax on a whole series of parts or equipment that got worn out and are now clearly second-hand. Under these circumstances, that will be -- and you're probably right -- more than compensated by the fact that the labour component will not be included.

Hon. A. Petter: That seems to be the expectation, yes.

F. Gingell: I'd like to suggest that that may well be a very difficult calculation. I have my own experience of dealing with prototypes. When we built the used-oil re-refining plant in North Vancouver, we bought all kinds of bits and pieces, and they didn't work. We wore them out, we burned them out, pumps blew, we had to get bigger pumps and different things happened. Really, the product at the end, which became a commercial plant, was very difficult to recognize from what we had started with.

I'd like to suggest to the minister -- and I appreciate that it won't be appropriate to make an amendment here -- that your policy group may try and think this thing through again and perhaps talk to people like MacMillan Bloedel, who have done a great deal of work on their demonstration plant for the Nexgen operation in Port Alberni.

Moving from that to section 16(3.6), does the minister have a briefing note that will tell the House what that means?

Hon. A. Petter: I think the intention of this subsection is to extend the exemption to circumstances where a prototype is being demonstrated and there is a return being provided to the person demonstrating the prototype to cover the costs of the demonstration, to guard against an interpretation that would regard that income for demonstration as evidence of a transaction that would move this into a taxable category. Provided the return to the demonstrator is no greater than the cost of covering the demonstration, they remain safe in terms of their tax exemption.

[ Page 534 ]

F. Gingell: Excuse me for a moment before we move on. I'd just like to re-read subsection (3.5).

Sections 15 to 18 inclusive approved.

On section 19.

F. Gingell: During second reading debate, I talked about dedicated revenues, which this government seems to get into problems with -- or maybe the opposition does. But it's your government and they're your policies, and when it suits me, I argue against dedicated revenues. I think it takes away much of the role of government. In this particular circumstance, as I understand it, you are planning on setting up a separate trust fund, and it's only going to be about $5 million, unless you anticipate increasing many of the revenues that flow into this.

Has the minister thought about. . . . Have you set up any governance organization for this trust fund? Who is going to make the decisions? Who is going to have control of the fund?

Hon. A. Petter: The intention, as I understand it, is that the current board of the previous fund will continue, but they will not be under the thumb of Treasury Board guidelines in the same way because of the change in the nature of the fund, which gives them greater autonomy in terms of doing what the purposes of the fund provide with respect to this $5 million source of revenue. The member is correct.

F. Gingell: Can the minister advise us if all the directors, governors, trustees -- or whatever their position is -- are appointed by the government, or whether they reach that position through being officers of other organizations?

Hon. A. Petter: What I do know, based upon staff advice, is that the members of the board are broadly representative of various groups and organizations. How they come to be appointed, and the role of the organizations in making those appointments, I will have to find out for the member, or perhaps another member might find out on my behalf. If not, I will find out for the member.

F. Gingell: Perhaps the reason behind the question is the key to it. If you lose control of the money -- the money goes directly in and you don't appoint the board of governors. . . . I'm wondering whether the government has lost control of the fund. It would not be included in the summary of financial statements. The Minister of Environment has something to add to this, I think, but there are very few cases where tax revenues -- which is what these are, in their own form -- are sort of automatically allocated to some independent third party. I'm interested to know how independent that third party might be.

Hon. P. Ramsey: I think we'll do a tag team. As far as who appoints the board is concerned, it is government-appointed. It consists of really respected wildlife biologists with high expertise in the field. The current chair, who has been the chair since its establishment in 1981, is Dr. Ian McTaggart-Cowan -- you probably know him -- and the rest of the board have equal credentials. It's a very highly respected body. As for the fiscal controls, I'll leave that to my colleague the Minister of Finance.

Hon. A. Petter: As to the concern around how accountability is maintained with these circumstances, my interpretation of the question is that the legislation provides that this trust fund is subject to certain conditions within legislation. That's provided for in the legislation here -- the various purposes. The Ministry of Environment, as I understand it, is the trustee for the fund and is therefore bound to determine that the fund is expended with those purposes in mind. If it were not expended with those purposes in mind, the public would also be able to take whatever action. . . through normal judicial review, I assume. But this is speculation in an area where I don't expect we'll have to tread, particularly given the credentials referenced by my colleague.

[3:00]

Hon. P. Ramsey: I did not have the opportunity to comment on this bill in second reading. I want to very briefly comment on the establishment of this trust fund and reflect on the continuation of our partnership with the province's anglers and hunters in their desire to protect and enhance fish, wildlife and the habitat on which they depend. It was on their initiative that we agreed to levy surcharges on licences, which were put into a trust. It is by the measures we are enacting here today that we will be establishing a trust fund which will set all of those funds aside, make sure that they're not subject to Treasury Board freezes or other clawbacks, and ensure that all moneys that anglers and hunters contribute to habitat conservation are spent on those objects.

Sections 19 to 26 inclusive approved.

Title approved.

Hon. A. Petter: I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; G. Brewin in the chair.

Bill 2, Budget Measures Implementation Act, 1996, reported complete without amendment, read a third time and passed.

Hon. J. MacPhail: I call committee on Bill 3.

The House in committee on Bill 3; G. Brewin in the chair.

On section 1.

F. Gingell: The first section of this bill deals with definitions, and it deals, of course, with the definitions of post-secondary institutions, new taxes, residential electricity rates, etc. The schedule lists certain taxes, premiums and other items. I think it would be appropriate if, during the course of this committee debate on this bill, we assure ourselves which taxes are included in this and which aren't. I have a list of particular taxes that I'd like to question the minister on. It seems to me that this is the most appropriate place to deal with them.

My first question to the minister is: does this include liquor distribution branch markups?

Hon. A. Petter: No.

[ Page 535 ]

F. Gingell: Does this include school property taxes? You'll know that section 7 deals with the provincial property freeze, but the province collects two different types: property taxes for rural areas and property taxes for school purposes. So my second question is: does this bill include school property taxes?

Hon. A. Petter: The answer is yes, in the aggregate. By that, I mean, of course, that assessments will continue to go up and down, but the amount of tax levied for provincial school property taxes is frozen by this measure.

F. Gingell: I think I will leave discussion on that until we get to. . . .

Hon. A. Petter: I apologize. I just want to add something to be absolutely clear, and I appreciate the member's indulgence in letting me do this. The average is frozen. The reason I want to add that is that where there are new improvements, they can contribute to additional tax, but the average is frozen in a way that ensures that there is a freeze of tax. But obviously, if new improvements are created, they may contribute to additional tax revenues.

F. Gingell: I wasn't sure whether we should deal with this under section 7, but let's deal with it now. I notice that you now say "average" rather than "aggregate." Does that mean that "aggregate" is out and "average" is in?

Hon. A. Petter: Yes. And that's what I was trying to clarify. The term "average" is used in the legislation because the aggregate would remain unchanged if there were no new improvements, but given that there are new improvements, they can add and become part of the contribution. The idea is not to reduce the existing tax paid by existing improvements because of the introduction of new improvements; the idea is to prevent those existing improvements from going up in tax in total, and that's why the term "average" is used.

F. Gingell: At the moment, the way it's determined what each property owner pays in the way of the basic school tax levy, or whatever it's called, is by applying a specific mill rate to a specific assessed value. That mill rate, I believe, is the same in each school district but not necessarily the same in every school district in the province. Is that correct?

Hon. A. Petter: I'm informed that different mill rates in different districts reflect other parts of the financing formula.

F. Gingell: Those differences would apply only to capital debt cost-sharing, wouldn't they?

Hon. A. Petter: As I understand it, it is not just a question of debt. The mill rate is set in a way that tries to achieve equity in terms of balancing population against assessed values across the province so that there is equity in the way the school tax is collected as between areas that might have very high assessed values but low populations and those that may have high populations and low assessed values.

F. Gingell: In the old days we used to share debt service costs between the province and the local school district 50-50 for the first six mills, 75-25 for the next six mills, and 90-10 for everything over that. So I presume that those cost-sharing arrangements on debt service are still included in the determination of each school district's mill rate.

Hon. A. Petter: The advice I'm receiving is that we think that is calculated separately, but it's probably an issue that I should look into and get back to the member on definitively.

F. Gingell: Don't bother with that. I don't want you to spend time doing something that isn't necessary.

What concerns me, first of all, is the fact that there are different mill rates, and we have discussed why there are. The next thing is that assessed values change. The B.C. Assessment Authority has responsibility for reassessing every property every year. But what I understand is happening is that from this point on, for the purposes of provincial property taxes only, not for the purposes of municipal taxes. . . . If I do not improve my property, my taxes won't go up. But if I do improve my property, the value of those assessments will cause my taxes to go up. So the B.C. Assessment Authority is going to have to start to keep records on each piece of property as to construction prior to this bill and construction after this bill. You're going to have to do that separately, I would imagine, for provincial property tax purposes -- that appears on our municipal tax notices. The taxes that the municipality charge are not affected by this. I'd be interested in the minister's comment.

Hon. A. Petter: I am assured that the administrative complications which the member envisages are not going to occur. The kinds of minor improvements he's talking about are not going to affect the changes in the mill rate or in this formula. It's only major new improvements. The idea here is that where assessed values in aggregate don't change, and where there has been no new construction, then the mill rate will stay the same. When assessed value goes up, the mill rate would come down, but it would reflect the freeze. It's only where there's a wholly new capital construction or a new assessment on a new structure that it will be taken into account as contributing an additional component to the overall tax pie, if I can put it that way.

F. Gingell: So you're not planning on allowing the taxes to increase in a case where you add an extra wing to your house -- you put a new kitchen on the back with all the latest appliances, etc.?

Hon. A. Petter: As always, the answers are more complex. That is correct in the sense that the addition of that wing will not move the overall tax contribution up within that school district or that taxable area. But it may well move the value of that property up relative to other properties. Therefore that individual property owner may pay a higher amount, but not as part of a contribution to a larger tax burden in aggregate.

F. Gingell: The minister has brought back the word "aggregate." I had envisaged that if more houses were built in the community where I live, my taxes would go down. I understood from the discussion that that wouldn't happen and that the average would stay the same. I think that's going to be terribly difficult to calculate. I can just see that you're literally going to have to break the assessment roll down into all kinds of portions that are pre-Bill 3 and post-Bill 3, because you've got to determine what the averages are first and make sure that the averages stay the same, and then add on those that are post-Bill 3 so that they don't affect them. I'd like to suggest to the minister that this was an election promise somebody made without thinking about how you would actually do it. The administrative operation is going to be a nightmare.

[ Page 536 ]

Hon. A. Petter: I should have reassured the member off the top by simply telling him that this freeze has already been in place since 1994 and that the administrative mechanism has been ticking along just fine for the last three years. There's no change envisaged, so I don't think it does pose the nightmare the member suggests. I've heard of no one having any apparitions as a result of it.

F. Gingell: Mr. Minister, the issue is this: the freeze before wasn't legislated.

Interjection.

[3:15]

F. Gingell: Ah! The freeze before was not legislated. I had no right to go and wave Bill 3 in front of a magistrate's nose or an appeal board's nose and say: "The government's breaking the law." Yes, I agree that within your Treasury Board decisions, you made some policy decisions about what was going to happen to property taxes. However, the fact of the matter is that they were not legislated. We were all just pleased that as you increased every other level of tax you could think of -- a whole list of which I have here -- you seemed not to increase those quite as quickly.

It will be interesting. I'll go back to my files at home and look at all my tax notices. Well, actually, '93, '94 and '95 for my house, which has had no improvements since I became a poor MLA. My basic school levy -- the top line on the tax notice -- should be the same in the number of dollars for each period, or relatively the same. But I think you've got a different problem now.

Hon. A. Petter: First of all, I understand that while this is now being legislated, it's being legislated on the basis of the same policy-- a workable policy -- that has existed for the last three years. There's no intention to change. The individual tax notice of the member may have gone up or down, depending upon. . . . If everyone in the member's neighbourhood suddenly made improvements and the member didn't, it might have gone down relatively. If the member's neighbourhood suddenly rose in value relative to other neighbourhoods, it might have gone up or, conversely, down. It would not have gone up or down because of government policy driving it up or down, but because of the position of the member's property relative to other individuals' property. Since he's a poor MLA, presumably he didn't make the same investments; perhaps others' went up and his went down. But that would be the reason.

F. Gingell: They never went down, I can assure you, even though I didn't spend any money on the property. I wonder whether health inspection fees are included.

Hon. A. Petter: Are these rhetorical questions, hon. Chair?

F. Gingell: Yes.

Hon. A. Petter: I thought they were!

F. Gingell: Hon. Chair, I wonder if marriage licence fees have been frozen.

Hon. A. Petter: No. I might encourage the member to read out the entire list of fees and licence increases that he already knows are not included, so as to compound the rhetorical effect into a single presentation. Of course, that is the member's choice.

F. Gingell: Having got the choice, I shall take it. You know, there's all this. . . . There is a section in the definitions section that talks about "new taxes." If you go back and read Hansard from when this government was in opposition -- where they shall shortly be, we all hope and pray -- they used to continually criticize the previous administration for what they called new taxes and what the previous administration called user fees or some such thing. I understand that motor vehicle licence fees and driver test fees are now being moved to ICBC. I was wondering whether there was any freeze on what ICBC can do.

Hon. A. Petter: In terms of motor vehicle licence fees, no. Let me just say, if the member is trying to make a point, that I'm quite happy to acknowledge that it's not the intent of this legislation to freeze user fees in a broad fashion. The government believes that those who benefit from direct use of a specific government service should help to pay for those direct costs. Gosh! That's a market principle that probably the member opposite might even have some empathy for in his non-oppositional days or moments. Changes in fees will therefore be considered through the normal procedures on a case-by-case basis, with recognition given to the user's ability to pay but also with a recognition of the impact of those fees upon users.

In particular categories -- the member is, I think, going to jump up and talk about these now -- we have recognized, because of the particular significance of certain fees in respect of ICBC, student fees, etc. . . . We have made a particular commitment to freeze those. In other areas, we'll continue to monitor and consider the impacts, as we have in the past.

F. Gingell: I'm really pleased to hear the minister talk about a competitive marketplace. What the minister must do, of course, is to allow competition to take place first. These are all monopolies we're dealing with.

The minister intends to freeze auto insurance premiums. Does that include insurance premium taxes?

Hon. A. Petter: I understand that such taxes are paid by corporations, and for that reason they are not included within this list.

F. Gingell: I guess that answers the next one on my list, which was the corporation capital tax. Is that intended to be frozen?

Hon. A. Petter: It's not intended to be frozen by this legislation, but let me just remind the member that simply because something isn't frozen doesn't mean it is going to be increased, either.

What we're looking at here is legislation that reflects a particular commitment this government made to provide reassurance over time, particularly to middle-income earners, to parents in respect of tuition fees, and to drivers. There's a legal maxim that covers this, but I won't bore him with it. The fact that we have specified certain fees and licences that are frozen should in no way imply that it is our intention to increase others; they are simply not covered by this legislation.

[ Page 537 ]

F. Gingell: In no way would I want to suggest that you were going to do that.

It's interesting that we freeze domestic electricity rates. I don't think the government has the power to put a freeze on natural gas rates. But, of course, petroleum and natural gas pipeline taxes and royalties will affect the price that consumers pay, for those who happen to heat and cook by natural gas rather than electricity. Do you intend to freeze petroleum and natural gas pipeline taxes and royalties?

Hon. A. Petter: I don't know if the member realizes it, but he inadvertently came forward with a terrible pun when he said the government didn't have the power to freeze non-hydro rates. I should have let that pass. Yes, all fuel taxes are frozen, but royalties would not be frozen.

F. Gingell: Would that include natural gas pipeline taxes? There are also taxes on the natural gas used to run the compressors in the pipelines. Are those taxes frozen, all of which will reflect through to consumers?

Hon. A. Petter: They are frozen. The compressors are not frozen, but the taxes are.

F. Gingell: Logging tax?

Hon. A. Petter: No.

F. Gingell: Sport fishing licences?

Hon. A. Petter: No. If you'd like to give the whole list at the same time, I encourage the member.

F. Gingell: Game hunting fees?

Hon. A. Petter: No.

F. Gingell: Name registry costs -- costs of registering?

Hon. A. Petter: A rose by any other name is going to be excluded from the freeze, for the member's information.

F. Gingell: Corporate registry fees?

Hon. A. Petter: No.

F. Gingell: B.C. Rail fares for citizens and consumers?

Hon. A. Petter: Obviously the member didn't get the adequate briefing he required, because he could easily have got these answers earlier. No.

F. Gingell: If we would have all briefings recorded by Hansard, to get them into the record, we wouldn't have to go through these exercises. To the minister: B.C. Ferry rates?

Hon. A. Petter: Their status in respect of freezes or non-freezes remains unchanged.

F. Gingell: Coquihalla Highway tolls?

Hon. A. Petter: The status remains unchanged.

F. Gingell: Vital statistics agency fees?

Hon. A. Petter: Not affected by this legislation.

F. Gingell: Safety inspection fees?

Hon. A. Petter: Not affected by this legislation.

F. Gingell: Waste management fees?

Hon. A. Petter: Not affected by this legislation.

The Chair: It's like a tennis match.

F. Gingell: Public gaming licences and permits?

Hon. A. Petter: Outside the scope of this legislation.

F. Gingell: Child care facilities and licences?

Hon. A. Petter: Those are not covered by the legislation. If the member wants me to, I could read the things that are covered; it would be so much easier.

F. Gingell: Land title branch registration fees?

Hon. A. Petter: Not covered by the legislation.

R. Thorpe: Will products sold through the LDB -- the markup on the taxes. . .?

The Chair: Hon. member, that has already been asked and handled.

Section 1 approved.

On section 2.

[3:30]

F. Gingell: During second reading debate we had an opportunity to briefly voice our concerns to the minister with respect to the hydro rate freeze. I know the minister is going to say that I want taxes to go up -- and he knows that's a load of nonsense -- but I do want to stress that this government appoints people into positions as directors of these Crown corporations, and they have the responsibility to determine things. This government is calling for Hydro to pay a $214 million dividend this year -- the biggest dividend in many years and far greater than its anticipated income. Every time we open the newspaper B.C. Hydro has all kinds of problems: they have holes in the dams, and they have problems with water in the Campbell River. They have a whole series of issues, and we mustn't put them in the position where they have only two alternatives: not do things that should be done and endanger the safety of our citizens or push up other rates that are not frozen to a point where businesses close down and people lose their jobs.

I know I'm going to be told that I'm against freezes. We're all for the lowest possible thing, but darn it, B.C. Hydro has problems -- problems which happen to be particularly apparent this year. They've had to borrow more money recently. You want this huge dividend out of them, and I am concerned that you are constricting their options in an unreasonable way, one that is not appropriate for you to do.

[ Page 538 ]

Hon. A. Petter: The member is sensitive on this issue. I will not accuse him of what he says; I'll accuse him of something else. During the election campaign this member ridiculed this freeze on the basis that there was going to be no increase in any event, and he said therefore it was going to have no impact and no constraint upon the Hydro board. Now he rises in the House and criticizes on the basis that it will have a constraint and an impact on the Hydro board. It strikes me that you can't have it both ways, so I'll choose that criticism instead.

Having said that, let me assure the member that the dividend that he refers to was predicated upon there being no rate increase and that Hydro has pursued, and will continue to pursue, measures to achieve administrative efficiencies, which I'm sure my colleague the Minister of Employment and Investment could expand upon. Of course, this is an important commitment to British Columbians to give them some assurance that this charge that so many pay will not be increased for the period of the next three fiscal years.

Section 2 approved.

On section 3.

F. Gingell: Section 3 deals with automobile insurance. I take it from this particular wording that it covers everybody. It's not just individuals; it's corporations, trucking companies -- everybody. Is that correct?

Hon. A. Petter: Well, we may have to get more information for the member, because I can't seem to get as precise an answer as I feel comfortable with. The note I have here suggests compulsory insurance, which is what is frozen as the basic package mandatory for all British Columbia vehicle owners, including accident benefits and $200,000 of third-party liability coverage, among other things. It does not include basic premiums for optional insurance, which are fixed by ICBC.

However, while not supported by legislation, these premiums have also been frozen for two years. Optional insurance coverage above and beyond the compulsory package, such as collision, comprehensive and excess third-party liability. . . . Therefore the net effect of the freeze is that a person's premiums will not increase over the 1995 level unless they have had a change of circumstances, such as an at-fault accident, a change of vehicle or a move to a different rating territory.

Now, the specific question on truckers and things is the part I can't seem to get nailed down as specifically as I would like for the member, but I'll try to do so in the next few minutes, and if not, in the next day or so.

F. Gingell: I'm sure that the minister appreciates and understands that the concerns about the possibility of no-fault being legislated into the automobile insurance environment in British Columbia is something that all members of this Legislature are hearing about from their constituents. Does the minister see any connection between the consideration of no-fault at this time and the decision to freeze basic automobile insurance rates?

Hon. A. Petter: No direct connection, no. I think what this freeze represents is an understanding by this government that the kinds of increases that have sometimes occurred in the past around automobile insurance are not going to be acceptable, at least in the immediate future, and I suspect they will not be acceptable beyond that.

We must find ways to have the Insurance Corporation work to find efficiencies and improve its ability to provide good insurance at reasonable rates. The Insurance Corporation has a challenge that will require it to review administrative costs and any number of different matters -- safety initiatives, photo radar and those kinds of things -- to try to ensure that insurance in the future does not entail the kinds of increases we have sometimes seen in the past.

In reviewing that general concern, not related specifically to this freeze, I am sure they will look at a range of issues including product, fault versus no-fault and all sorts of other schemes, but I don't see that as a necessary outcome of this initiative. I see that review and the outcome that will come forward, and the debate we will have around whatever changes may be made in administration or whatever at ICBC, as part and parcel of a general concern by the public, reflected in this legislation, that rates cannot continue to rise in the way they have in the past and in other jurisdictions.

F. Gingell: This government has been in office for five years and three months to the day. During that period of time, you have had control and jurisdiction over ICBC, and we have continually heard about efforts and energies being directed to ICBC. You have changed presidents quite a few times. One of them could have solved your problem with photo radar. You got all your salary back, by the sound of things, with one particular person you chose.

But is this auto insurance premium freeze an admission of defeat? Have your efforts to this point in bringing ICBC to heel all failed, and now you can't trust them anymore to keep insurance premiums low? They operate primarily without any competition, and, as most monopolies do, they tend to be a pass-on-costs industry. So you brought this in to bring them to heel?

Hon. A. Petter: Quite the opposite. This is indicative of our confidence in the ability of ICBC -- which, through a number of administrative measures and very aggressive safety programs, has reduced the potential increase that would otherwise have occurred in premiums and costs -- to now go further and live up to our commitment to the electorate in the last election to freeze premiums for the next two years. It is my hope to keep premiums down as much as possible beyond that period.

F. Gingell: Does the minister believe that such things as auto insurance premiums and hydro rates being frozen are an appropriate election promise, in view of all the statements made by members of the NDP on such shenanigans carried on by previous administrations?

Hon. A. Petter: This legislation reflects the view of this government that we believe this to be an appropriate way of responding to the concerns of British Columbians. I daresay it would not be appropriate if it were not a serious commitment and if it were not one that we believe can be delivered upon. In this case, we believe that these commitments are ones that can be delivered upon and ones the electorate wants to hear. The electorate has suffered increases of various kinds over a number of years, not only under this administration but under others.

[ Page 539 ]

F. Gingell: I'd like to record in Hansard my support for your keeping ICBC premiums low. I know that if I don't say that, I won't be able to quote it back to the minister at some subsequent point.

As I'm sure the minister knows, I have a two-pronged issue. I'm concerned that ICBC may be forced to take actions that none of us are comfortable with, to meet the requirements, and I do have concerns about good governance. I think good governance requires this government to appoint people they can trust -- who are competent, capable and experienced -- into positions as directors of ICBC, Hydro and other such organizations. You have to give them the freedom and the ability to do what they believe is in the best interests of all our citizens.

Hon. A. Petter: And give them good guidance, which is what this legislation does.

Section 3 approved.

On section 4.

F. Gingell: I would just like to record that all the things I said about section 3 I think about section 4.

Section 4 approved.

On section 5.

[3:45]

F. Gingell: On June 27, during the interim supply debate, the member for Okanagan-Penticton asked the Attorney General this question: "Will the minister confirm to this committee that there will be no markup fees or tax increases with respect to the products sold by the LDB to the citizens of British Columbia?" The Attorney General responded, on page 64 of the British Columbia debates: "Of course, there is legislation coming to the effect that there will be no tax increases." That statement by the Attorney General is in direct conflict with my first question that I asked the minister today, on section, 1 about liquor distribution branch markups.

Hon. A. Petter: I think I've got to resolve this confusion. There is a freeze on the social service tax that applies to liquor, which is within this legislation. There is not a freeze on markups with respect to liquor. I think that may help resolve the confusion that the member has.

F. Gingell: I was going to stand up and say: "Well, that's not what the Attorney General said." The question he was asked was two-pronged: markups and taxes. He responded: "There will be no tax increases."

The only point I'd like to make is that it's only in question period that you're not supposed to answer the questions; in committee stage you normally do answer them. These members have referred for many years to liquor control board markups as taxes. You made a great point of it when you were in opposition. Every time the price of a bottle of whisky or a case of beer went up, the government was accused of increasing taxes. I find the response by the Attorney General to be a little unclear and, of course, at variance with the minister.

Perhaps the minister will consider, as he has the right under this bill, subsequently bringing something in through order-in-council onto the schedule. To make sure that the Attorney General is not considered to have made an incorrect answer, he might now decide to include liquor distribution branch markups.

Hon. A. Petter: Perhaps the member can advise his colleagues not to ask two-part questions that create confusion. As I understood the Attorney General's answer, it was an accurate answer as he read it.

Section 5 approved.

On section 6.

F. Gingell: Section 6, of course, deals with the requirement that there shall not be any new taxes. If you go back to the definitions in section 1, new taxes "means taxes payable to the government on income or on the acquisition, use or consumption of property, rights or services. . . ." I'm wondering whether a reasonable interpretation of that -- the minister is a lawyer and I'm not -- would consider some new service that was to be delivered by government, for which there would be a fee to recover the cost, to be included in this, because it talks about the acquisition, use or consumption of rights or services. This could be interpreted to mean only those services provided by a third party -- i.e., you won't bring in a sales tax on food. You're taxing legal fees; you're not going to put a social service tax on architectural services or accounting services or physiotherapy services. I presume this clearly excludes not the new tax but the expansion of what's included in the present tax. But does it also intend to mean the charging of a fee for some new service being delivered by government?

Hon. A. Petter: The member was correct in his characterization of the intention until he reached his question. The answer to the question is no, it's not intended to apply to a fee for a service provided by government.

Sections 6 to 11 inclusive approved.

On the schedule.

F. Gingell: I presume that by order-in-council the Lieutenant-Governor can add items to the schedule. I'm quickly looking, but I can't see it immediately. It talks about making regulations.

Hon. A. Petter: Section 8(2).

F. Gingell: Yes, but does that allow regulations?

Interjection.

F. Gingell: Oh, for amending. . . . Yes, (c). Thank you.

Schedule approved.

Preamble approved.

Title approved.

Hon. A. Petter: I move that the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; the Speaker in the chair.

[ Page 540 ]

Bill 3, Tax and Consumer Rate Freeze Act, reported complete without amendment, read a third time and passed.

Hon. A. Petter: I call committee stage on Bill 7.

The House in committee on Bill 7; G. Brewin in the chair.

Hon. D. Zirnhelt: Let me begin by introducing staff that are with me here: Michael Grist, Jim Langridge and Richard Grieve. They'll be assisting me today.

Sections 1 to 3 inclusive approved.

On section 4.

T. Nebbeling: In section 4 -- actually sections 4 and 5 apply to the same issue -- what I'm looking for is an explanation. Does the ownership of a timber-processing facility exclude a lease status for a wood licence, and if so, why?

Hon. D. Zirnhelt: Yes, it does, but there was some lack of clarity with respect to control. The effective word here is "control" of a corporation that owns a timber-processing facility. It has to be a majority interest. When the woodlot program was established, it was clear that it was to provide wood to other primary breakdown facilities. The program was not designed to provide wood to new primary breakdown facilities. This just clarifies the definition of control.

T. Nebbeling: Just to clarify, then: have owners of facilities in the past been able to operate wood licences, and are there still wood licences today operated by owners of wood-processing facilities?

Hon. D. Zirnhelt: No, they were not allowed to before, but we are adding leasing, so if they control through leasing, they now cannot circumvent the intent of the original law. The idea was that they shouldn't be able to control through leasing or ownership any primary processing facility.

T. Nebbeling: Then are there today wood-processing facilities that have leased wood licences and are operating these wood licences? And if so, what is the impact of this amendment on these operations?

[4:00]

Hon. D. Zirnhelt: To our knowledge no one who owns a wood-processing facility also has a woodlot licence, but there may be some who lease. It's a very few in number. This isn't a major amendment; it's just tightening up a requirement that we feel has already been there.

T. Nebbeling: I understand this is a minor amendment, but still, if it does have impact on certain operators today, I think we should know that. If there is an impact, how are you going to deal with these operators? Are you just going to put them on notice that they'll lose their timber licences, or are you going to give them compensation? How will you deal with these few licence holders?

Hon. D. Zirnhelt: We couldn't do anything now under the existing licence terms until such point as the woodlot licence came up for renewal, and it wouldn't be renewed unless they got rid of their timber-processing facility.

Sections 4 and 5 approved.

On section 6.

T. Nebbeling: In regard to the delegation of power -- or application of power; I don't know how you look at it, hon. minister -- and the consequences of the decision-making by a district manager, or whoever you have delegated to make decisions that fall within this section, is there any appeal mechanism in place so that parties affected by decisions have an opportunity to come back and not necessarily accept the decision made by your delegated agent?

Hon. D. Zirnhelt: The answer is that the appeal mechanism would be judicial review; there is no other appeal.

I'd like to point out that the reason this is here is that woodlots are minor licences in the scheme of things, as you know, and there is no reason why everything has to come to the minister's desk. It's our intention to have routine transfers, for which people qualify, administered at a much lower level. It reduces the number of bureaucratic steps that a licence transfer has to go through.

The answer on the appeal is that it would be a judicial review.

T. Nebbeling: The reason I am asking this question is that later on, in other sections, we are going to talk about the empowerment of officers working for the Ministry of Environment, and I will have questions about the seniority of decision-making in that area. At that time I may refer back to this section, because if the regional manager or district manager is given certain powers that, because of other sections, he has to share with other agencies such as an officer of the Ministry of Environment, then I think maybe we could walk into a problem. But we will come back to that section. That's my own observation.

Hon. D. Zirnhelt: I'd like to answer the member and maybe clear it up. In this act, there is no one else who has powers to determine on a licence. Under the Forest Practices Code of British Columbia Act, there are powers that other people have, but not in the licence transfer provisions of the Forest Act. So it would be only the regional manager who makes a decision here.

T. Nebbeling: Again, I am trying to find some clarification here, because when I read through the various sections I see some potential conflicts -- not necessarily of personalities, but of authority. I think the district manager's authority on decision-making may insert an aspect, be it under the Forest Practices Code or under any other part of this act, of a joint function with an appointed officer of the Ministry of Environment working within a forest district. We will get to that later on. I'll keep an eye on this when we discuss it further.

The Chair: I think some of the themes will show up again. I recognize the hon. member for Cariboo North.

J. Wilson: It's my understanding that at present woodlot licences are transferable only when they are held under the name of a company, and the shareholders can turn over in that company. When an individual holds a woodlot licence, it is virtually impossible to transfer it. If you sell your place, you cannot transfer your woodlot licence with your place, even 

[ Page 541 ]

though you've tied up a lot of schedule A land with it. Will this allow any individual to transfer a woodlot with his place if he sells out?

Hon. D. Zirnhelt: This section won't have any effect on who can transfer -- what legal persons can transfer. This deals only with what level the decision is finally approved at, and we are saying that it's at the regional manager level.

J. Wilson: I believe, then, that there will be basically no change in the system with regard to transfer of woodlots from one individual to another.

Hon. D. Zirnhelt: That is correct; this act doesn't address that issue. I'd be happy to canvass it with the member at some point, but that was not one of the amendments that came through. A legal person is a legal person, whether it's a corporation or an individual. Quite frankly, I don't fundamentally understand. . . . I understand the problem; I don't understand the law. But I'd be happy to discuss it with you and get back to you on that matter.

J. Wilson: Maybe I can try to clarify this. I have seen instances where a woodlot could be transferred. Simply, when you have more than one shareholder, you can change shareholders. Many woodlots are not owned by companies; they are owned by individuals, and those individuals, at present, are not treated the same as a company.

Hon. D. Zirnhelt: There is nothing in this legislation that will affect, negatively or positively, the situation you describe. I acknowledge that I am aware of the problem, but this act doesn't do anything to help or hinder that situation, so it's not really part of this legislation. It's only at the level the decision is made. I would be happy to canvass it with you and get back to you on an interpretation.

Sections 6 and 7 approved.

On section 8.

T. Nebbeling: Again for clarification, Mr. Minister: does the extension apply to wood-cutting operations that fall under the small business forest enterprise program?

Hon. D. Zirnhelt: This section does not apply to small business licences. These are major licences, which in this case are called non-replaceable forest licences or timber sale licences.

T. Nebbeling: Is it the practice that these majors actually subcontract to smaller operators, and if so, what size of logs do they contract out?

Hon. D. Zirnhelt: I am a little unclear on the question. Subcontracting out blocks of their licence? Is that what you said?

T. Nebbeling: Interfor has a certain area, and I think it uses subcontractors at times to take on certain portions of its licensed cuts.

Hon. D. Zirnhelt: That does happen, but it does not transfer any responsibilities under the licence. The licensee can't transfer legal responsibilities. Where there is an allowable annual cut reduction, this section allows the same amount that they would have harvested under their non-replaceable licence, which is for a fixed term. That is what this section is designed for. Say it were a ten-year licence. They could have a million cubic metres a year for ten years; if there's been a reduction, it allows this quantum of wood to be taken over a longer period of time. So they aren't penalized; they still get the same volume rather than being cut off prematurely. This is of benefit to licensees that would rather cut the same amount over a longer period of time than be chopped off at the end of their licence.

T. Nebbeling: That was the clarification I needed. I was concerned that smaller cutblocks would be affected by reducing the annual size of cut opportunities to the point where the financial viability wouldn't be there any longer for a person to go in on a yearly basis. So if that is not the case, then I'm content.

W. Hurd: I wonder if the minister could advise the committee of the typical circumstances in which the harvest would be reduced in a non-replaceable licence. What kind of scenarios are we dealing with -- timber supply reviews or environmental considerations that may come up? I wonder if the minister could take a minute to explain to the committee the determination that would be made to reduce the harvest level, which obviously is the intent for introducing this section of the bill.

Hon. D. Zirnhelt: It has to be done under section 7 of the act, where there's a TSA review and the chief forester makes a determination. So this includes all the reasons the chief forester might have to make a reduction. There may be land withdrawal; there may be an overestimation of volumes. His determination will possibly reduce the AAC, in which case the intent is to allow the same volume to be taken out, but over a longer period of time.

W. Hurd: Clearly, the intent of the section is to confer on the regional manager some power which may or may not have existed previously under the act. From the explanatory notes in the bill, my understanding is that the regional manager will now have the designated authority to be able to negotiate a longer licence period. Is that what I'm to assume to be the intent of this section?

Hon. D. Zirnhelt: The power will lie with the regional manager. There is a formula that determines it, so he has no discretion.

W. Hurd: I think this is an important section. I wonder if the minister could advise the committee about the formula that is used. What type of communication are we dealing with in terms of the minister's office and the regional manager, in terms of the formula that would be used to extend the licence for an unspecified period, perhaps two or three years? Not to adjust the harvest level, but to extend it over a period of years. . . . I'm thinking of stumpage calculations and that type of thing that might impact the Crown in terms of a longer time frame for harvesting the same volume of wood.

Hon. D. Zirnhelt: I would point out subsection (2) of this section. The licence shall be extended according to the formula. The minister's office wouldn't get involved in this decision.

[ Page 542 ]

W. Hurd: For a point of clarification then, can the minister advise us whether the formula is determined by the chief forester, or is it part of the chief forester's mandate to set AAC levels? If the annual allowable harvest is extended over a longer period of time, does that formula emerge from his calculations, or is it internal to the operations of the ministry?

Hon. D. Zirnhelt: The chief forester will determine a cut level for an area. This act says that the regional manager must apply this formula to the licensed quantity and determine how many years, etc., that it takes to harvest. Just to remind you, the purpose of this section is to allow somebody who has a non-replaceable licence to extend the term of the licence so that they can take the same volume out over a longer period of time. That's the purpose of the formula. This calculates it.

[4:15]

W. Hurd: Maybe I can try and simplify the discussion, and ask the minister for the compelling need that the ministry has seen for this change in the act. Did we have a situation previously where licensees were losing a portion of their harvest as a result of a land use decision or a recalculation by the chief forester? Were we seeing a situation where -- at the end of a ten-year replaceable licence, for example -- if the licensee hadn't been able to harvest all of the allocation, it was just lost? Is that the scenario that occurred previously?

Hon. D. Zirnhelt: This is dealing strictly with the non-replaceable licences. With an AAC reduction, they would lose a portion of their licence if this provision was not here to extend the term of the licence. These licences are often used to harvest problem forest types like beetle wood and so on. Reducing the AAC of these licences under present circumstances typically requires the ministry to issue new licences to ensure that the problem forest types are harvested. What we can do here is give some flexibility that benefits both the owner of the licence and the forest manager who still wants to deal with the problem for which the non-replaceable licence was created.

I can think of a perfect example that I know only too well. The beetle-kill lift in some areas sets an AAC -- a temporary AAC -- that's quite high. The chief forester sets it for a period of time. If at the end of that period he chooses to reduce the AAC -- the temporary lift -- a certain amount, he can extend out into the future to still harvest the problem forest type or the beetle-kill wood. It keeps whole the non-replaceable licence holder.

W. Hurd: Just to follow up briefly on a question that was posed by my colleague from West Vancouver-Garibaldi. These are timber sales that are outside the small business program -- the category 1, section 16(1), the entire licence system under the small business program. Is that what I was to conclude from the minister's. . .?

Hon. D. Zirnhelt: That's correct. There are approximately 26 non-replaceable forest licences and two major non-replaceable timber sale licences. Forest licences and timber sale licences -- both non-replaceable -- total 28. So there's that special category of licence that I'm sure you're familiar with, and yes, I will confirm the information: it's not the small business program licences.

W. Hurd: Just one further clarification. In terms of a non-replaceable licence over a period of, say, five or ten years, where a determination is made that, for whatever reason, the targeted harvest level cannot be reached, could the minister just describe the way in which the licensee would approach the ministry to have the licence extended? Is there a procedure that the minister could describe for the committee that the licensee would have to follow? Would it be a direct appeal to the regional manager, and that's where the whole system would end? Or would it have to be vetted by any other ministry staff? Is it now just strictly consigned to the regional level of the Ministry of Forests?

Hon. D. Zirnhelt: I think the answer to your question is: if somebody can't harvest, they lose it. That's the way it is. This provision and the formula kick in where the chief forester has reduced the AAC, for whatever reason. Only then does this formula kick in. In the situation you describe, you'd lose it, and it probably would be readvertised. I'm not aware of any provision, but I'll look for one that might suit a person in those circumstances. I don't think there is any built-in safety valve for someone who underharvests. That's a cut-control issue, and those provisions around cut control apply.

W. Hurd: Where the AAC is reduced by an application of the Forest Practices Code, for example -- where, as a result of special geographic features or perhaps the need to extend protection to a watershed, and the AAC is therefore affected -- what would the procedure be for the applicant or the licensee?

Hon. D. Zirnhelt: This does refer back to the section under timber supply review, where the AAC is determined by the chief forester. What he must take into account when making a determination are such things as land use plans, the Forest Practices Code, inventories, growth and yield, etc.

W. Hurd: Finally, hon. Chair, I wonder if the minister could just advise the committee of how prevalent a problem this has been. Has this initiative mainly been the result of the ongoing timber supply reviews and the land use plans of the ministry? Clearly, the minister has seen a need to bring in this amendment, and I just wonder if throughout the province we're seeing an increased incidence of these kinds of cut-control problems on non-replaceable licences.

Hon. D. Zirnhelt: These licensees have had this concern for four or five years, so it predates the current situation. But as I say, it refers back to where determinations are being made. As you know, the timber supply review has brought in a steady stream of determinations which are playing catch-up towards getting to sustainability. So I would say that these licensees have become more numerous. More short-term licences have been awarded, and a lot of them dealing with particular problem forest types. This gives more flexibility. I think it creates more security for the licensee as well as for the Crown.

J. Wilson: I'm a little slow on some of this stuff, so when I ask a stupid question I'd appreciate a good answer. I read this over, and perhaps the hon. minister could fill me in. Would woodlots fall under this category of non-replaceable tenure?

Hon. D. Zirnhelt: No, they don't. They are replaceable licences. There are only the 28 that I mentioned -- non-replaceable timber licences and non-replaceable forest licences.

[ Page 543 ]

J. Wilson: Then my second question would be: would a tree farm licence come under this category?

Hon. D. Zirnhelt: No.

J. Wilson: The extensions here can come in -- I presume as many as arise and as often as they arise -- and you could get several extensions, not just one or two? Could these things occur on a regular basis? I notice it says that the annual cut would be reduced on the last year. Now, if you extended the life of the cut by one year, would you harvest that volume in the first ten years if it were originally a ten-year cut, and then in the eleventh year there would be no harvest? Is that how this reads, or am I confused?

Hon. D. Zirnhelt: Let me try to answer it a different way. If you had a 15-year licence, in that period of time there could be three timber supply reviews, and each one might potentially affect your cut level. If there was a determination by the chief forester, then he would extend the licence enough years to take in the full volume. If the original licence of 15 years said a million cubic metres, and if there was a reduction in the AAC and they planned to take it out at one-fifteenth a year, the regional manager could say that we will extend your licence to, say, 20 years -- enough years to take in and make up the volume that he would miss. The whole idea is to allow the non-replaceable licence holder to harvest the same amount, but over a longer period of time and therefore pay off their invested capital in a plan, or whatever they had. It might be paying off their roads and other obligations that they have undertaken.

J. Wilson: I would like to present a scenario to the minister, which, if it does exist, is something that could create some concern to me. In an area such as the Cariboo-Chilcotin where you have a land use plan. . . . We have zones there and there is the potential of a considerable reduction in, say, SRDZs, where mule deer winter range could severely impact the AAC in these areas. It is my understanding that when the interim strategy for mule deer habitat comes in, there are going to be recommendations that the cut in these old fir belts be reduced severely. Is this something that is going to deal with that and allow that to happen?

Hon. D. Zirnhelt: Yes. If the chief forester was to reduce the AAC in the timber supply area, and if there were non-replaceable licences affected in that area, then it would allow the regional manager to extend the licence so they can take the same volume over a shorter period of time. For the instance that you have given, I don't believe that in the drybelt fir area where there are mule deer prevalent, there's a non-replaceable licence. The ones I'm aware of, to make it easy for you. . . . There's the West Fraser licence, which is a cedar licence in the Cariboo mountains not affected by mule deer. There's one in the Chezacut supply block held by Riverside Forest Products, which is non-replaceable as well. There's the West Chilcotin, the one held and operated under West Chilcotin Forest Products, the Yun Ka Why'Ten licence.

J. Wilson: Could you describe the boundaries of that one in the Chezacut area?

Hon. D. Zirnhelt: Very precisely: the Chezacut supply block. I can't tell you where it goes, but I can provide you a map. I don't know any local place-names to orient you, but it was generally considered the Chezacut area, the Chezacut supply block.

[4:30]

J. Wilson: I believe that's the hon. minister's riding. I could stand to be corrected here, but along the Chilcotin River there is some old-growth fir, and some of this is being looked at for mule deer winter habitat.

Hon. D. Zirnhelt: I do have to bring the member back to the legislation, and say, if the chief forester sometime in the future -- which would be approximately five years from now, or it could be sooner -- were to make a reduction, and that affected one of these non-replaceable forest licensees, then he would have to extend the term of the licence as per this formula to allow him to cut the same amount, albeit over a longer period of time.

Section 8 approved.

On section 9.

T. Nebbeling: This section will allow some addition to the annual allowable cut on a licence holder's place. Can the minister tell me: how will the additional timber be incorporated in the existing allowable cut? Will the allowable cut be increased for the whole timber supply area where this particular parcel of land is? How is that going to be handled?

Hon. D. Zirnhelt: What will happen is that a plan will be approved by the regional manager and the information submitted to the chief forester. The criteria set by the chief forester would ensure that any lift to the AAC was in accordance with his own criteria. In other words, if they provided new information on growth and yield or evidence that the results of fertilization or pruning created an increased yield, then a lift to the AAC could be given. But as to the particular lift on the licence, that decision would be something administered by the regional manager.

T. Nebbeling: The lift on that particular licence, I can see, is a step that will have to be taken. What I'd like to find out, however, is: how will the impact of that lift on that particular licence reflect on the other licences out there? Or is this a mechanism to actually go beyond what the chief forester has set for an annual allowable cut in that particular timber supply area where this licence is controlled?

Hon. D. Zirnhelt: The intent of the legislation is that the AAC for a particular licence can be raised, and it won't affect the cut levels of the AAC that has been apportioned to other licensees until the next determination, and then the chief forester is going to have to take everything into account again when he makes another determination. He does that anyway, but the idea is that within those areas covered by this agreement, the lift in the cut will be absorbed or utilized by the licensee of that area. So it really formalizes some of the chart areas and tries to bring a productivity focus to specific areas.

T. Nebbeling: I'm trying to get a grasp of this. If there's a timber supply area where a licence does not get an increase from the chief forester, and at the same time we see one particular licence being increased by a substantial amount of annual allowable cut, then somebody has to give somewhere. Either it is in a reduction in other cutblocks or the regional manager is actually going over the head of the chief forester by increasing the timber supply area's annual allowable cut as set by the chief forester. I'm trying to figure out how this works legally.

[ Page 544 ]

Hon. D. Zirnhelt: If none of the licensees did anything, there would be the same amount of AAC. What this provision says is that in response to specific applications of technology or methodology in management, if there's a justifiable increase according to the chief forester, then you can give a lift to that particular licence.

T. Nebbeling: So you're saying that the chief forester will increase the timber supply area's total annual allowable cut as a consequence of that lift and that particular licence. After that decision is made, that particular licence is such-and-such and could operate such that he could have an increased yield. Is that what you are saying?

Hon. D. Zirnhelt: The lift for the whole TSA would happen at the next timber supply. What this allows for is that if the chief forester is satisfied that there's enough volume within the area of operation to allow this increase, the AAC for this particular licence can be increased in between determinations. The future cutting would be offset against the increased volume that would be produced.

T. Nebbeling: Through this act, the regional manager of a certain timber supply area is allowed to overrule the quotas set by the chief forester for a period of time. The chief forester has agreed upfront to that overruling, if the regional manager finds cause through better harvesting methods on a certain licence. Is that what you're telling us?

Hon. D. Zirnhelt: Let me try to explain it this way. The regional manager will increase the AAC using methodologies that have been approved by the chief forester. It is expected that the regional manager's determination of any increases to the AAC for a licence will normally coincide with the chief forester's AAC determination for the TSA.

T. Nebbeling: So let's go beyond the point where the yield has been increased on one particular licence. Two years later three or four of these incidents have happened and there's another million cubic metres in that timber supply area. The point I'm trying to make is that the chief forester looks at exactly what has happened in the supply area over the past two years and sees that another million cubic metres of timber have been allocated in the tree supply area. Is there a chance that the chief forester will readjust the other licences by a reduction to compensate for the extra timber that he has allowed to be harvested? Is there a provision in the act that this will not happen, that the chief forester during his following review will not reduce the timber supply areas and the allowable cuts because of the increases in the previous two years?

Hon. D. Zirnhelt: If, when the chief forester looks at it in the timber supply review, the lift was not justified, then the power is here to take it back. It would come back out of that licence, because the intent was clearly to lift that licence in response to the work done by that particular licensee. So we're talking about six of these on an experimental trial. There is a theoretical possibility that at the same time that there is a reduction or a takeback, they might do a general reduction across the timber supply area, but not in response to this, because the intent of the act is clearly to add only in response to that increment that has been produced by superior methodology and management.

J. Wilson: Innovative forestry practice has got a real nice sound to it. It almost sounds as good as incrementality. Is there any connection here between the incrementality under the FRBC and this innovative forest practice program we're developing?

Hon. D. Zirnhelt: You're talking about incrementality. Under the forest renewal program they're supposed to fund those things that normally aren't done by basic provisions of the requirements of the licences, which is basic silviculture. The things that we expect to be done are things that are not now done by licensees, so yes, it could describe some of the same activity areas as are covered by FRBC.

J. Wilson: That's sort of what I had thought might happen here.

There's another. Under subsection (3)(b) it says "an agreement under subsection (1). . .may include terms and conditions that the minister considers are necessary to effectively carry out the purpose of the agreement and further the social and economic objectives of the Crown." Would the hon. minister care to go into that in a bit of detail?

Hon. D. Zirnhelt: Sure. There is a broad definition of social and economic objectives. It might be to increase local employment. It might be to have additional jobs out of the timber. As you know, we have said that there is an objective to create more jobs out of a volume of timber. So if a proposal comes in to do that, the minister may well link that to a requirement to maintain or increase jobs.

J. Wilson: Could that also mean that when your coffers are empty, you can change the stumpage rate to meet the needs of the day?

Hon. D. Zirnhelt: This section has nothing to do with stumpage.

J. Wilson: Under sub-subsection (4): "The Lieutenant-Governor-in-Council may make regulations specifying. . . ." Does this mean that we can expect orders-in-council to change this at any time they wish without bringing it to the floor of the Legislature?

Hon. D. Zirnhelt: Yes, the Lieutenant-Governor-in-Council will determine which types of practices qualify, and they'll do it by regulation rather than coming back to the Legislature for infinite detail and description of what practices qualify.

J. Wilson: Could the hon. minister be specific as to what could be changed within the Forest Act under this agreement?

Hon. D. Zirnhelt: There are two things that can be changed under this provision: what activities qualify, and which types of licence holders qualify. Those two can be changed. To be specific about what qualifies, we expect it will be things like fertilization, better growth and yield analysis, and perhaps better inventories. If a detailed inventory had been undertaken, or detailed growth and yield trials had been undertaken which showed that some sites were more productive, it's that kind of thing that we expect to qualify under this section.

[4:45]

[ Page 545 ]

W. Hurd: I've been following the debate on this section with a great deal of interest. As I look back on my own tenure as critic of Forests, I can remember many times in Committee A -- a lonely vigil, indeed -- with the current Minister of Employment and Investment talking about the real advantages of value-added forestry and of investment in small licences to create incremental forestry advantages. I did hear the minister talk about terms like "experimental," and it only applying to four or five licences, I think he said, which causes me to believe that we haven't achieved the breakthrough with this section that I thought we might have.

On the issue of licences, I wonder if the minister can advise whether the incremental forestry provisions would apply to things like tree farm licences, for example, and other types of area-based tenure licences that exist. Would this be across the board, a sweeping change within the ministry that would allow for an intensive forestry proposal to come forward that would encompass silviculture, growth and yield analysis -- the whole gambit of intensive forestry opportunities -- and allow the regional manager to take decisive action in raising the annual allowable harvest? If that's the effect of this section, I think it represents something of a breakthrough.

Hon. D. Zirnhelt: There is no need to have this under TFLs, because if there is a lift to the AAC that's a result of the investment or activities by the TFL holder, they're the only ones in that area and therefore they will get the lift. This is designed for volume-based licences. They then have to justify it within the management plan that we have, where there are many licensees on the land base. So there's going to have to be some specific management plans that say where the work is going to be and exactly what the productivity increase is going to be. So it's designed mainly for forest licences.

W. Hurd: Under this section I wonder if the minister can advise the committee what protection there would be in place if the innovative forestry plan is approved and vetted through the ministry and becomes part of the licence agreement. Could it be lost as a result of a separate issue from the Ministry of Environment, for example? Or is it then part of a legally binding agreement between the Ministry of Forests and the licensee once the plan has been approved? I'm just trying to explore with the minister the legal commitments or ramifications that would result from that plan being approved and the licensee proceeding on the basis of there being a lift or an increase in their annual allowable harvest for that licence.

Hon. D. Zirnhelt: We will interrupt proceedings here and pick them up later, but let me answer the member's question first.

There is no way to take back the increase that has been given for the time period for which it was given. At the time of the review of the allowable annual cut -- the timber supply review -- if the chief forester, on re-examining this lift, says it was a wrong decision or that five years of experience don't justify that level of increase, then it can be taken away. This only affects those licence holders who have agreements under this section; it won't affect people who hold licences under other sections.

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

Motion approved.

The House resumed; the Speaker in the chair.

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

W. Hartley: Committee A rises, reports resolutions and asks leave to sit again.

The Speaker: When shall the committee sit again?

Hon. J. MacPhail: In a few minutes, hon. Speaker.

Interjection.

Hon. J. MacPhail: Hon. Speaker, the response in the main House will be deferred until a later date. In the meantime, I call Committee of Supply A to hear the estimates of the Ministry of Women's Equality. I also call Committee of the Whole to continue debate on Bill 7.

The House in committee on Bill 7; G. Brewin in the chair.

On section 9 (continued).

W. Hurd: I appreciate the minister's explanation of the intent of section 9. I wonder, however, if the minister could comment on a concern that I have under this section. This has to do with the willingness of licensees to invest in innovative forest plans in light of what I believe I heard the minister advise the committee -- that some of these plans may not be as ironclad as we were led to believe -- in terms of the increased cut being protected in the event of a redetermination by the chief forester, for example, or perhaps an environmental initiative from the Ministry of Environment.

As the minister well knows, a licensee can invest considerable time and expense in a whole range of initiatives: growth and yield analysis, for example, or the analysis of the advantages of juvenile spacing over time, etc. I wonder if the minister is at all concerned that even though this provision would appear to invite innovative forestry projects to come forward, in fact some licensees may still be reluctant to incur the expense to approach the minister with an innovative forestry plan without any assurance that it would be accepted and whether that increased lift would have any security over time.

Hon. D. Zirnhelt: The member might feel a little better about this if he knew that there's quite an expression of interest by licensees. Unfortunately, some of them were a little late in taking it up, but we have three who were in very early after we announced the forest renewal program, and they appear to be willing to take the chance. Let me say that if it's justifiable, then anybody making a determination will have to ensure that the portion that goes to the work they've invested in goes to them. I think the contracts themselves will indicate the terms and conditions under which somebody can withdraw if the benefit was there. If the benefit wasn't there, if increased growth wasn't there, then I'm sure the licensee would be the first to admit that the agreement shouldn't be renewed, or that the AAC should go back to where it was.

[ Page 546 ]

This is why we're not proceeding wholesale and trying to do this everywhere in every TSA. We want to try it, see how it works, and at the end of the first five-year period we may have a pretty good idea of whether these are working or not. There is a bit of risk on the part of both parties.

W. Hurd: I wonder if the minister can advise us how extensive this change is going to be. He's advised the committee that it will have limited application initially. I'm aware that one of the challenges the ministry has always faced is manpower as a resource issue to deal with these innovative forestry plans coming forward, and now the myriad requirements, from code requirements to land use decisions -- the whole gamut of things that ministry staff would have to access before they could vet and approve this innovative forestry plan. I wonder if we are dealing with any shift in resources from within the ministry to deal with the fact that they may now be called upon to review a rather complex forestry plan and actually lift the AAC, based on their assessment of the plan's viability and the licensee's ability to carry it out.

Hon. D. Zirnhelt: There is incentive to have these in places where there are land use plans. We're trying to get one going in each region where there is a land use plan. The incentive is to try to increase the productivity, because in some parts of the land use plan there's a depressing effect on the AAC. In other areas, we want to lift it -- in those areas dedicated for intensive timber management. That's what is going to make the land use plans work.

There's no shift in resources. The resources involved in coming to one of these agreements would have to be allocated from the existing staffing of the region. If you're only talking about one agreement in a region, which is what we're talking about now, then it shouldn't be too onerous. They would do this instead of some other work. For example, there's less work taking place because we've just completed a timber supply review, so those same people aren't involved in that. We just completed a land use plan. There is a workload issue, but it isn't a big workload. There's been no indication that we can't handle it from the existing complement of staff.

W. Hurd: In terms of how this section will dovetail with the provincial land use plans, is there an expectation that the ministry would give preference to innovative forestry proposals on land designated in the land use plans for intensive forest management? The minister will be aware that under the Cariboo and the Vancouver Island land use plans, there are areas that have been specifically designated for intensive forest management. Would it be reasonable to infer that as a strategy the minister would apply the innovative forestry proposals to those areas first where, as a result of an extensive land use planning process, those specific areas have been identified as holding great potential for intensive forest management? Is there going to be a strategy to dovetail the requests with areas that already have great potential for growth and yield increases in the years ahead?

Hon. D. Zirnhelt: I would go one step further and say that I expect that in those areas where there's a higher cost-benefit ratio. Those areas are probably the ones that are zoned that way.

The answer to your question is that we haven't designated the area specifically. Suffice it to say that we fully expect that's where they will go. They will go in areas of either enhanced management. . . . Certainly, we should encourage people to be in the forest land reserve, which is those areas zoned that way.

[5:00]

The intent is to respond to increased production, an objective we set out under the forest renewal plan. It's essentially private sector investment which will be offset with a private sector benefit in the lift. Of course, we want to target those areas where there's no zoning problem, where the objectives of the zone are to give a lift and enhance management and productivity.

W. Hurd: So in terms of presenting an innovative or enhanced forestry plan to the region, would we be dealing with communities available to take advantage of this type of opportunity? Would they be individuals who might, say, apply for Forest Renewal funds to undertake this type of enhancement? Or is it just strictly limited to existing holders of licences, and a very narrow band of licences at that.

I wonder if the minister could just clarify for us whether communities, individuals -- and perhaps, while I'm on my feet, I could also ask about woodlot owners, who, as the minister knows, have a component of private and public land in one management unit. . . . Would they also be eligible to present an innovative forestry plan and have the AAC lifted on the portion of their licence which was under public domain?

Hon. D. Zirnhelt: It was a complex question, but let me try to answer it this way. It could go to the holder of a forest licence or another agreement entered into under section 10, which specifies a range of types of licence holders. To answer another aspect of your question, they could apply for Forest Renewal dollars and then there would have to be an assessment of the viability of the project, the benefit of the project. If it's specific to this management agreement, then the AAC lift will be to that licensee's benefit.

W. Hurd: Having spent long hours reviewing the forest renewal plan in committee, I wasn't aware that the plan was accepting applicants who might be accessing Forest Renewal funds for an innovative forestry plan and a lift of their own AAC. I could stand corrected on that, but I wasn't aware that they could do that. That's interesting information, if that's indeed the case. The minister is saying that someone could make application to Forest Renewal B.C., acquire money under the plan, use it to offset the costs of an innovative forestry plan, then apply to the ministry to have the AAC lifted. Is that a scenario that could happen under section 9, the section we're dealing with here in committee?

Hon. D. Zirnhelt: I clarify it this way. Under the eligibility criteria on Forest Renewal funding, if the applicant is going to be the primary beneficiary, then that's taken into account. The objective here is to get private sector investment into the forest land base, and in exchange they get the return. That's the intent. I didn't want to be too categorical about saying that on part of the land base you might get an investment of Forest Renewal. The intent of Forest Renewal is to go on those parts of the land base and then the public benefits, and the government decides on the distribution of those benefits.

What we're trying to do here is encourage private sector investment. When I mentioned the forest renewal plan, if you go back to the original document, part of the renewal plan had 

[ Page 547 ]

nothing to do with funding but said that we would take applications for innovative forestry trials. We had some applications in response to that, and we've been working with applicants. There's some six in the works -- three are almost ready to go. I think there are letters of intent trying to come to some agreement.

W. Hurd: I have a few more questions on this section. I am particularly interested in what mechanisms the ministry will have to audit the innovative forestry plan over time. Clearly, when the applicant presents an enhanced forestry regime, it may include a whole range of activities, all of which would lead to the lift in the AAC. Does the minister or his staff see a need for the regional manager to designate resources to audit the performance of a licensee over time to ensure that the strategies that went into lifting the AAC are being met in a timely way and that the licensee is meeting the commitments that were made under the innovative forestry plan? It seems to me that when the minister suggested earlier that he didn't see a real need for any increase in resources to deal with this program, we didn't really touch on whether there was any intention by the ministry to go back into the licensed area to review the innovative forestry plan as to its progress and timely completion.

Hon. D. Zirnhelt: District staff will take this on as a function, and of course a higher level of information will be provided to the ministry and then there would be spot checks. They will go out and do normal monitoring and auditing of those activities out there on the land base. There would be a special review at the five-year mark, and that will have to be part of the ministry's workload, but they'll of course let. . . . The methodology is known, because the chief forester agrees to a lift based on the methodology. They go back and do a check based on the methods set out in the agreement.

W. Hurd: Finally, I wonder if the minister can advise the committee of how many cubic metres we might be dealing with during this fiscal year, say. I'm trying to get a handle on the extent of the program. The minister talked about it being a trial program. In terms of size, perhaps he could advise the committee how many agreements he expects will be vetted and approved by the ministry under the provisions of this section, and how many cubic metres we might be dealing with in the province over the next year, which, I would assume, is the time period we would want to deal with.

Hon. D. Zirnhelt: The member will know that we won't be held to figures, but let me just say that I have heard discussions where there's an expectation that with better growth and yield information, there's sometimes a factor-of-three increase in productivity. But on average, over a larger land base, I've heard figures as high as a 40 percent increase on land base. So if we're expecting six across the province and they involve hundreds of thousands of hectares, you could compute the number of cubic metres. I haven't done that; I would be happy to try to get back to you with a rough, ballpark estimate just so you can scope it out.

But if you imagine six licensees, all of whom are cutting plus or minus 200,000 to 300,000, and they are looking on a part of that lift, we're talking about potentially millions of cubic metres. If we don't get that, it won't be worth the while, but I can't be specific.

W. Hurd: The minister has indicated that the enhanced forestry plan is still subject to the determination by the chief forester as to the AAC. Is he satisfied that the chief forester's determinations will in some way respect the work that's gone on with respect to the enhanced amount of cut that would be available under this type of plan?

As the minister knows, there is an appeal mechanism in place for determinations by the chief forester. Would one of those appeal mechanisms on the part of the licensee be that this enhanced forestry plan wasn't necessarily adhered to or respected by the chief forester in making his AAC determination? I'm wondering whether the minister feels that this innovative forestry plan would carry any additional weight with the chief forester in terms of his determination on an AAC for the specified region or perhaps for the licence in question.

Hon. D. Zirnhelt: Since the chief forester determines the criteria, and the decisions are based on those criteria, I would expect that he would honour his own commitment unless he could demonstrate otherwise. The next step of appeal after the chief forester would be judicial review, so I would expect that if there was a major disagreement, it would go there.

I did mention millions, potentially. I think that's what we're talking about across the province, ultimately, but within the term of six agreements, it would have to be. . . . My officials say thousands; they're very conservative. It has to be tens of thousands, or it wouldn't be worth doing. I know that we're looking at trying to get a major lift because of this investment.

You know the kinds of things that happened on Weyerhaeuser's cut, and Lignum Ltd. has done growth-and-yield. I'm sure you've probably seen some of the plots. They fully expect that there will be a dramatic increase, albeit on a smaller and confined timber base, but the expectation will be that we will more than make up over time for any dislocation that happens as a result of more sensitive management in those zones that are designated for sensitive management.

That's fully the intent, and I know that the applicants really believe that you can meet the code, meet the biodiversity guidelines and enhance the productivity. We're fairly optimistic about this. We're anxious to get on with these and give the protection in law that these sections give to those people who want to do the innovative trials.

W. Hurd: Am I to conclude that the minister is envisaging six of these types of agreements across the province? Is that the number we're dealing with?

Hon. D. Zirnhelt: Six is the number by the end of the year. We have three that are fairly advanced, and then there are more in the wings.

J. Wilson: Would the minister be willing to describe the six that are in progress and give us some detail on them?

Hon. D. Zirnhelt: The subject of the legislation is not the details of the particular ones, so what I can explain to you is the information I have on them. The three licensees whose proposals have been submitted are Interfor, Lignum and Weyerhaeuser. Interfor intends to operate in the Kamloops and Fraser TSAs, Lignum in the Williams Lake and 100 Mile TSAs and Weyerhaeuser in the Merritt TSA. Weyerhaeuser is being considered for a TSA-wide approach involving all the licensees in the TSA and the ministry, so there's a little variation in the types.

[ Page 548 ]

As for the details, I can say only that I'll try to provide you with some level of detail that is known. I can't do it here, and it really isn't appropriate to this provision, but I would be happy to try to get you what information is available.

J. Wilson: When this all started to come into being, was anything put in place to allow all major licensees within a TSA to apply for these new supply areas, or were these innovative forest practice areas simply chosen -- how would I describe it -- through perhaps a good corporate citizen approach?

[S. Hawkins in the chair.]

Hon. D. Zirnhelt: I don't think I'd be too crude saying it's on a first come, first served basis. Three companies submitted proposals and they vary a little bit. As I indicated, one of them involves all the licensees and the two other ones don't. Everybody had access to the information, everybody could apply: some did and some didn't. The ones that did are at the front of the queue. The decision will be made by the minister, upon recommendations from the ministry, as to which ones go ahead. . . . Previous to my being the minister. . . . I believe that two letters of intent have been signed to this point in time. The negotiations agreement will proceed.

J. Wilson: I've had a considerable amount of query raised from people in regard to this one that's under progress with Lignum. It would appear that there is not very much information available to the public to actually know what is going on there. Would the minister please enlighten me somewhat as to the area within the Williams Lake TSA, and possibly some of the Horsefly TSA, as to the number of hectares of land, or percentage of that area that would be put into this innovative forest practices area?

[5:15]

Hon. D. Zirnhelt: I'll give a general answer to the member. It's the traditional operating areas of the company. If you look at their chart areas, which generally describe their operating areas, those would be the areas, but nothing has been finalized. I can't be any more specific than that. The intent of the legislation is to provide an assessment of which ones qualify. This is a case of people who are prepared to do the work and have submitted the work. The member said that there's not a lot of public information available. I understand that the available information has been communicated publicly through the community resources board. As well, an information session was held with other licensees in the area. Suffice it to say that under the land use plan we are encouraging innovation and enhanced management. These fit with the goals of the land use plan, and the government's intent is to proceed with getting some innovative practices arranged under contract.

J. Wilson: This may be in an operating area, but once this goes into effect, am I wrong in assuming that it will then move from an operating area to an innovative forest practices area, which will exclude other users in there on that Crown land?

Hon. D. Zirnhelt: It does not turn the licence into an area-based tenure. It does not do that. There is nothing in this that would restrict the uses. Maybe other provisions of other legislation would restrict it. For example, if there's pesticides being applied in an area, that would be governed by other legislation, and if there was an intensive forestry practice that was dangerous, people might be excluded, but this does not convey the powers of an area-based tenure.

[G. Brewin in the chair.]

J. Wilson: Perhaps I should rephrase the question. Will the small business portion in this TSA carry on in that area? Will blocks be put on the small business program coming up in there? Or will they be shut down because of this new volume-based area?

Hon. D. Zirnhelt: There shouldn't be any effect on the small business program.

J. Wilson: I find it difficult to envision increasing the allowable cut by millions of cubic feet when business is going to be carried on as usual under the small business program and whatever else exists in there. It is confusing to me. Could the minister explain how they intend to achieve this additional cut and yet still allow the small business practice to exist and compete with this project?

Hon. D. Zirnhelt: There will be more wood produced by the agreement of the chief forester, and if there's more wood produced, then more can be harvested. I expect we get more off the same area. In other words, the increase in cut doesn't come from expanding the area. So you've got some small business operators, you might have some private land, you might have a whole lot of other land uses in the area, but the area that's designated for intensive timber production will yield more wood. I can answer simply by saying there has to be more wood produced on the same area; otherwise, they can't cut anymore. The increased benefit will come down the road. You won't cut the benefit automatically right now, but more will be growing; therefore more of the mature or ready-to-cut forest in that area could be cut, based on the fact that more is growing on the areas that have been treated.

J. Wilson: The hon. minister is saying that private enterprise is going to invest literally thousands and thousands of dollars into extensive silviculture work here in an effort to produce more wood. That's commendable. Does he actually believe that they are going to do this with no security whatsoever out there on that land base? Is this what is actually going to happen? Will there be no security of any type for the licensees who go out and do these improvements at their cost? Or is all this improvement work going to be done using FRBC funds?

Hon. D. Zirnhelt: Yes, the licences are replaceable, so they've got those licences -- with evergreen clauses in them -- and it's expected that that licence holder will reap the benefits down the road. I don't expect any company to sign an agreement where they don't think there's security for the agreement. The agreement will say basically that where you can demonstrate, according to the criteria of the chief forester, that more is growing, then you can have a lift in the cut associated with your licence. So this is producing more timber, and it says that those who make the investments to produce more timber should get the benefits. That's how the contract between the Crown and the licensee will read, and there will be many pages. I expect it will be only upon their own legal advice that they will sign such agreements.

J. Wilson: That sounds an awfully lot like an area-based tenure somehow.

Anyway, I have another question for the hon. minister. Suppose I wish to go in there and I'm a beef producer, say, somewhere between Clinton and McLeese Lake, which 

[ Page 549 ]

I believe is the area that is taken in by this huge project, and I would like to expand my agricultural operation. What future is there for me there? Do you think that the licensee is going to say: "Oh, sure, you can take up another quarter or two quarters of land here and develop it"?

Hon. D. Zirnhelt: I fully expect that those areas that are treated for enhanced production will restrict the uses on that land in accordance with the zone. So if there's a zone that identifies expansion of agriculture, then I would expect that any management plan will account for that. There's no reason, in theory anyway, that you couldn't have additional agricultural land allocated. If it's an enhanced management area, it might be enhanced for agriculture, but you have to go back to what the zone said. If the intent was to enhance, then the integrated resource management principles that apply would have to take that into account.

The fact of the matter is that under existing systems, there is very little land being converted from forest land to agriculture, unless it's a very, very high value for agriculture. Unfortunately, the land that grows grass best, as you know, grows trees best. So we're going to be targeting some of the same land base with these management objectives. I would say that as we get more and more investment in the timber base, there will be a resistance to take it out of that timber base. If you talk about the area from Clinton to McLeese Lake -- a long area, a huge number of acres -- my view is that there's got to be room for all the users on the base. That's the challenge to the enhanced management.

J. Wilson: It would appear that the bigger and the more powerful you get, the fewer problems you have. As someone that has a little understanding of the problems facing producers today. . . . Anything that allows more competition for that land base, which they really have a necessity for, is going to work against the industry.

I have already had some problems brought to my attention, where some road deactivation and landing deactivation, through this, which I believe could. . . . I may be wrong, but I believe it could be part of this package. Money has been put up by FRBC to get this work done, and it is right on some prime rangeland. A lot of these animals tend to utilize these areas fairly intensely. It is a large portion of the forage during the summer for these animals, but apparently no consideration has been given to the producers in that area to allow them to get a little more utilization from these sites.

Hon. D. Zirnhelt: If the member would like to produce some of the details, we'd be happy to look into it. But I would have to say that where you get an investment by a range tenure holder, who might be investing in the forage resource, the same thing would apply. They would want some security. As you know, they don't have the same kind of security in terms of long-term licences, but that's not to say that that couldn't happen sometime.

This legislation is targeted at trying to give incentives to invest in the forest land base. I don't necessarily see any contradiction, but if it's deactivation of road and landings, and that works against the management of other resources on the land, then I would say the managers of the land have to take that into account. I can't see anything in this legislation that would take away from that, because in my view, where there are no other conflicts, there will be an intensification of the use.

I think that the timber producers in that area should understand the cattle producers' needs, and I would be surprised if this agreement would take away from the continued viability of that industry. If you want to provide those specifics, I'd be happy to give you a response as it relates to this legislation.

Sections 9 and 10 approved.

On section 11.

T. Nebbeling: Before I let my two colleagues have a good go at the minister for technical perspectives on this section, I would like to ask the minister to explain briefly for me and for whoever is interested the process of finding jurisdiction to allow a salvage operator on land that is under control of an operator who has the jurisdiction of the use of that land. What kinds of mechanisms are there that alert the salvage operator to the potential of salvaging on a certain timber licence area? How is the owner of the timber licence in a sense protected and aware of what's there? What kinds of mechanisms are in place within this whole section to make sure that whatever is taken out of there is indeed salvageable timber and not part of a potentially bigger grasp? I'm really looking for the process here. Are we secure that it is timber that should qualify under the salvage guidelines? How is the owner of the land itself protected from potential intrusion by non-licence holders using that land for purposes as described in the section?

[5:30]

Hon. D. Zirnhelt: There were several parts to the question. The first answer is in section 56.1(3)(b)(i), which states that you must be harvesting "windthrown, dead, damaged, insect infested or diseased timber or special forest products." That's in the act, and those officials monitoring licences would ensure that happens. If it was other than those categories of timber, then I would expect a cease-and-desist order would be placed on that licensee and the penalty applied for them going outside their licence -- the normal mechanisms for monitoring small-scale licences. The dilemma has been that these small licences take a lot of people to look after them, and that is a strain on resources.

What will happen with respect to protecting the rights of the timber or forest licence holder -- I think you referred to them as the landowner -- is they don't have tenure rights except to harvest in the area. What this provision allows for is an additional licensing if the major licence holder doesn't want to do the salvaging. Once the Ministry of Forests has been alerted to it, it can tell the licence holder that there is salvage timber that's in danger of being lost and ask them what they are going to do about it. They have 14 days to respond, and if they don't respond in the affirmative that they're going to salvage it, then the Ministry of Forests can begin the process of letting some of the small-scale salvagers take that wood.

T. Nebbeling: Fourteen days' notice before the licence holder must respond, to either take it out or. . .?

Hon. D. Zirnhelt: Fourteen days. It is a relatively short period of time, but don't forget that the salvagers are anxious to get in there. They don't have to take it out in 14 days; they just have to signal their intent to take it out.

T. Nebbeling: How do you notify the timber licence holder, and who actually instigates the whole proposal of taking some of the salvageable timber from that land?

[ Page 550 ]

Hon. D. Zirnhelt: Under section 56.1(4), there has to be written notice provided to the timber sale licence holder, and on that notice the timber will be identified as to a location on a map. That's my understanding. As far as finding out where this wood is, an individual who wants to salvage it can go out and find it, note it on a map and take it to the Ministry of Forests. The ministry would check it out, see that the timber qualifies and send the notice to the licensee.

T. Nebbeling: So people can actually scrutinize the land and find an amount of timber? Is there a minimum percentage of timber that has to be a salvageable product before a licence will actually be applied? I know there's a maximum of up to 2,000 cubic metres, but is there a minimum amount that forces the timber licence holder to make a decision -- either he will take that timber out or he will allow an outsider to come onto his licence land and do that?

Hon. D. Zirnhelt: Clearly, if it's too small nobody will want to do it. There is no minimum really, but if it's not worth the cost of the paper to produce it, I suspect it won't get processed. On the other hand, there may be small specialty-product people who can make use of it. I've heard of individuals wanting three trees in a certain location, and they've gone to rot over the years because they couldn't salvage those particular three trees. They had some high-end use for it and were not able to get in because of the way the law is right now.

T. Nebbeling: I can see that if somebody wants to take three trees out of an area, that's no problem. But when you start talking of up to 2,000 cubic metres, I think that's a different issue altogether, and I think that justifies my next question. Will the timber that comes out of that area under this salvage program -- after, I suppose, traditional activities have taken place on that land. . .? Will that timber that comes out -- and is not necessarily taken out by the licence holder -- go against his annual allowable cut?

Hon. D. Zirnhelt: There are a number of options for the district manager to sell salvage: he's got the Forest Service reserve, or it could be put up for small business. There's a number of ways of allocating. If he uses this section, then it does come off. The intent of this is to give the district manager the right to take -- if I can use that word -- the amount, the volume under that licence, off the quota. This section should provide an incentive for the licensee to salvage wood or have it salvaged by their contractors -- or to get new contractors in to do it. And if they say they're not bothered with it, then it gives the district manager the right to tender that out or to award it directly to another licensee -- potential licensee, salvage licensee.

T. Nebbeling: I find this is getting very complicated, and this all has to be done within a 14-day period, as far as the decision-making process is concerned. You tell me, Mr. Minister, that there is an operator who collects salvaged timber on other people's licensed land -- the licensees. The salvage collector is the initiator of having interest in the product and goes to the district manager, I take it, and says: "I want that stuff." The district manager writes a letter to the licence holder, who gets 14 days to respond -- to make up his mind if he actually has the manpower to take it out. For whatever reason, it may not be economically viable for the licence holder but it may be economically viable for the salvager. The point is that in the end, the licence holder would lose a part of this annual allowable cut -- what he would traditionally or otherwise use on green timber to create his operational numbers so that he can create a viable operation there. So my point again is: is there something else in the act that allows the salvager to go after that land without a district manager having to demand that annual allowable cut on that land?

Hon. D. Zirnhelt: The way the act is written, some of that salvaged volume would go to waste. I think the intent here is to ensure that salvageable wood gets salvaged by somebody. There is no intent here to raise the allowable annual cut based on more that's salvaged. If one of the principles is that licensees shall cut the forest profile and some of that profile happens to be dead-and-down or dying or in need of immediate salvage, then it's expected that they'll harvest their share of that. So this really is allowing timber to be harvested which otherwise might not be harvested. There is no way that that volume can be taken off the quota right now, so there's no incentive for the licensee to salvage dead-and-down and endangered wood fibre. This does provide the incentive.

T. Nebbeling: I find this whole section seems to be very punitive rather than being an incentive for the licence holder to deal with what you also consider a serious problem: wasted wood on the ground. Wouldn't it make more sense, instead of trying to penalize an operator of a licence by this mechanism, to create an incentive whereby the timber that is, because of the description, not really harvestable or valuable will not go against the annual allowable cut?

Hon. D. Zirnhelt: The problem is that to date most of the salvage has been taken out of the small business program; therefore less is available to those people. So a disproportionate amount of the salvage is being done by the small business operators. What we're saying here is that those who hold long-term licences can't get off scot-free. There's got to be some encouragement for them to harvest; and yes, it's punitive. That's the point. They will have their AAC, their quota, reduced if they aren't salvaging. What that does is then say to the small harvester that they can go to the licensees and say: "It doesn't look like you're going to get this, so why don't you let us in there to operate?" It gives the district manager the power to set up the sale accordingly.

T. Nebbeling: This is my final question before I let my colleagues have a go at this. With your experience, and coming from an area where this kind of activity takes place, how is the working relationship between these salvage operators and the timber licence holders?

Hon. D. Zirnhelt: I don't think there's an adequate working relationship, and the ministry hasn't got anything to encourage a better working relationship. My guess is that with this provision, there will be some encouragement to develop a better working relationship.

T. Nebbeling: I would suggest that the minister look at my suggestion and try to create an incentive rather than punishment. By not counting the annual allowable cut against the timber licence holder's operation, you may see that the working relationship between the salvage operator and the timber licence holder will be a hell of a lot better. A threat is no longer there for the timber licence holder of having an outsider coming onto his land at a tremendous cost to the operator.

Hon. D. Zirnhelt: I take the suggestion. But what he describes, I think, is the status quo right now. The licensee should go out and take what's down. They don't do that now.

[ Page 551 ]

The idea that you might raise the allowable annual cut because people are harvesting is quite a different issue, and at this point we're not prepared to do that. We will monitor what happens. The salvage licensees are pleased that we've got a package of incentives for them, and this is one of them. They're the ones who have been sitting there unable to get at a lot of this timber, and this provides an opportunity for them to get at it. The licensees always have the opportunity to do it themselves. I'd have to say that that's an incentive.

T. Nebbeling: I want to conclude by saying that I think there is a better way of dealing with this particular problem. I agree that the salvageable timber should come out of the forest and off the land. It should be used wherever it can be used, but not necessarily at the cost of punishing another part of the same industry, which I think at this time is already in dire straits because of the tremendous costs put onto it through additional stumpage fees and restrictions on its ability to get harvestable timber. I was just trying to create something that might give the minister an incentive to bring the parties together rather than divide them by a section such as this one.

[5:45]

R. Neufeld: Just a few quick questions to the minister on this section. I quite clearly recall that this was an issue that was always brought forward on the committee that dealt with small business and how we could better utilize our forests. I guess you can call it: "how to deal with the dead-and-down in a fair manner." I don't take issue with many parts of it. In fact, I think it leaves it fairly open, and that allows for some latitude for the district manager to deal fairly with everyone.

But I wonder about a couple of things. Obviously this timber will be taken out while the licensee is working in the cutblock, so there are such things as road costs, bridges and regulations that surround the Forest Practices Code -- numerous things. Who is ultimately responsible for those kinds of issues? Will the person who is bringing out the salvaged timber have to pay the licensee a certain amount for using the roads, the bridges and that kind of infrastructure? How are you going to assess damage if something is done, let's say, around a creek or a stream, where there's some damage done to a streambed that really hasn't been done by a licensee, but that could have been done by someone salvaging timber?

Hon. D. Zirnhelt: The terms of the licences that the salvagers would specify what they're responsible for. If they have damage, they're fully responsible for that under the code. It is the salvage licensee who is responsible for any damage or any violation.

With respect to the use of infrastructure -- roads, bridges, etc. -- the salvager would have to get a road-use permit, and the district manager could assign maintenance responsibilities, and could say, if they were operating under muddy conditions, that they'd have to grade the road surface or return it to its original surface. The permit and the terms of the particular licence would specify their responsibilities, and they would be code-related.

R. Neufeld: So what you're saying, hypothetically, is that if you take someone who has gone into a cutblock and identified a certain amount of wood in a large part of the cutblock, then I would presume what would happen is that the ministry would inspect that cutblock -- and the licensee would already be done and gone -- to see if there was any damage or anything. I'm just trying to get through how we're going to end up without someone saying that it's that person's fault, or it's the other person's fault. So I guess there would have to be a whole-site inspection, and a sign-off by ministry to the licensee, before the salvage operator was able to start.

Hon. D. Zirnhelt: We would expect most of the activities to be outside cutblocks; it might be on the edge, if it's blowdown. We don't expect that most of these operations will take place in the same operating area. It will be a little blowdown here or there that's outside the cutblock.

There may be a case where there's an inspection in the same area two or three times. There might be a small business operating in the area. There might be a number of cutblocks. I would hope that the officials can inspect the various licensees, and do that efficiently. The burden to the ministries is one of the reasons why we ended up with this situation where we didn't have a lot of salvaging going on. We've asked the ministry to take on this additional load, and they are going to have to do it as effectively as possible. They will have to monitor it in a way so that the different licensees in the area will be held responsible for the terms and conditions of their licences.

R. Neufeld: I can see some salvage happening, not just on the fringes of a cutblock. There could be some salvage almost any place in the cutblock, so that's an issue that they will deal with on the ground.

The other issue I have is stumpage. How is stumpage going to be collected, from whom and on what basis?

Hon. D. Zirnhelt: These salvage licences will be regular timber sale licences; that's the mechanism we use. That's as it is now, with the same licence mechanism. All this allows us to do is to deduct that volume from the major licence holder's volume, so it provides an incentive for the licence holder to find a way to salvage that and not let it go to waste.

In response to your earlier question, the district manager can time and hold. . . . The district manager has to manage these salvage licences so it doesn't interfere with the licensee's obligations or activity on an adjacent cutblock.

R. Neufeld: In the event of road deactivation and pulling out bridges, those kinds of things, I assume that any salvage has to be taken in before the licensee intends to deactivate the roads and remove their bridges. Is that correct?

Hon. D. Zirnhelt: We have no illusions; there is going to have to be some coordination. There are going to be mistakes -- there are mistakes now -- between the small business program and major licensees. Hopefully, the area foresters who understand what's going on in the area will know, and the road permits may have to be amended. You might have to give a licensee a longer period of time to deactivate a road, or there might have to be some arrangement made, but economics will have to be taken into account. You can't create a major expense for a major licensee for only a small benefit on the part of the salvager.

[ Page 552 ]

Major licensees and these timber sale licence salvagers are going to have to be working closely together, and it will be a management problem for the district manager and his operations people.

R. Neufeld: Further on the removal of timber and the minister's comment that most of it will be around the fringes of a cutblock, I recall reading not all that long ago about a major licensee that was fined a tremendous amount because they happened to go over their cutblock line by a matter of just 100 feet. Is the minister saying that if they cut up to their cutblock line -- that's the way we do forestry now, which is totally different than we used to -- and some trees fall over from the wind, is it fine for the salvager, then, to take them out but not the licensee? How will you police that?

Hon. D. Zirnhelt: The licensee has the right of first refusal on that, and he would have to have his cut permit amended or a new cut permit issued. It doesn't matter who is going to do the salvaging, either the licensee or a small licensee who gets a special licence: there will be a cut permit. The area has to be delineated on a map, and you have to look at what's going to be done for treatment afterwards. So it doesn't matter who does the salvaging, the same rules should apply. This does not create any special rule for the small salvager.

G. Wilson: I'm pleased to enter into this discussion. There are really three areas of concern specifically that I have with respect to the removal of dead or damaged timber from a timber supply area. The first has to do with the definition of "holder of the licence." What I'd like to hear from the minister is whether that definition essentially precludes the right of an individual from entering into a subagreement or a separate agreement with an existing licence holder to go forward and to salvage timber outside of the general business plan that the company -- if it's a company, and in most instances it will be -- may have already filed with the Ministry of Forests. In other words, can there be a separate agreement or a separate contract signed with respect to the harvesting of salvage timber within that licence area?

Hon. D. Zirnhelt: The answer is yes, that can take place, and we encourage subagreements.

With that, hon. Chair, I'd like to move the committee rise, report progress and ask leave to sit again.

Motion approved.

The House resumed; the Speaker in the chair.

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

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

Hon. D. Miller: Hon. Speaker, I move that the House stand recessed until 6:35 p.m., and thereafter sit until adjournment.

Motion approved.

The House recessed at 5:58 p.m.

The House in Committee of Supply A; W. Hartley in the chair.

The committee met at 2:35 p.m.

On vote 16: minister's office, $425,473 (continued).

G. Plant: I want to turn now to the subject of the Law Reform Commission of British Columbia, which I touched upon in the debate on interim supply a few weeks ago. I have with me the annual report of the Law Reform Commission of British Columbia for the year 1994-95. I want to read a paragraph on page 2 of that report which deals with the subject of commission membership. The commission says this:

"We feel compelled to reiterate our concerns over the fact that government has not appointed new commission members as the terms of existing members expire. Four years ago the commission consisted of six members. Now our numbers are half that. For almost two years the commission has operated with three members, the minimum number stipulated in the Law Reform Commission Act. This is not a healthy situation and if allowed to continue may have a serious effect on the ability of the commission to carry out its functions."

At the time that the report for the year 1994-95 was prepared, the commission consisted of three members: Arthur Close, Lyman Robinson and Thomas Anderson. As I understand it, subsequent to the date of this report, the appointment of Professor Robinson expired. There has not been an appointment to replace him, with the result that the commission now has fewer members than its statutory quorum and is, as a result, unable to prepare or file an annual report for the year 1995-1996.

In light of those circumstances, could the Attorney General advise both the amount allocated within the estimates for this year for the Law Reform Commission and, more generally, his intentions in respect of the commission?

Hon. U. Dosanjh: When I met with representatives of the Law Society and the Canadian bar during the election, we had a long series of questions and answers. They asked the questions, and I provided the answers. This was one of the important issues raised there.

I am concerned with respect to the situation with the Law Reform Commission. I did say then, and I would repeat again, that within the fiscal constraints that the government is experiencing, all these institutions and programs have been under review. We want the law reform functions to continue, whether those functions continue in the state or form they are in or whether there has to be another form found for those functions to continue.

As I said during the interim supply debate, if the government cannot continue to fund the Law Reform Commission in its present form, which I think might be the case, I'm prepared to look at the possibility of the Canadian bar, the Law Society and the Law Foundation contributing three-quarters of the funds and the government contributing another quarter, so 

[ Page 553 ]

that we have what would be truly a joint venture serving all of the entities I've spoken of. The Law Reform Commission performs a very important function, and I want to be able to preserve that function for years to come.

The money that has been allocated in the budget for the commission for this year is $374,800.

G. Plant: To take one specific point arising out of my previous question that was not addressed in the minister's remarks, is it the intention of the Attorney General to appoint at any time in the foreseeable future an additional commissioner to bring the commission up to its statutory quorum?

In that context, I want to add the following additional concern. It may be that my facts are wrong here, but I understand that the appointment of the commissioner himself, Arthur Close, has also recently expired but was extended to August 9. If he's not reappointed, or if his term is not extended after August 9, then the commission will be down to a membership of one. All of the economies in the world won't help the commission carry on any function in the short term, while the minister carries on the discussions that he's talking about with other groups. What are the minister's intentions with respect to both of these appointments in the short term?

Hon. U. Dosanjh: We will be appointing sufficient members to make up a quorum in the commission as early as possible. I will continue discussions and consultation with the various parties mentioned, so that we can come to a conclusion.

G. Plant: In that context, I want to make two general comments that I hope may be of some assistance to the minister as he continues these discussions. The first is the issue of false economy. I'm sure the minister will agree -- as someone who was, at one point, a private practitioner -- that the work of the Law Reform Commission has, in the past, been invaluable for a whole host of reasons. Law reform, if done properly, results in saving money, not increasing the burden on government. To cut the Law Reform Commission off at the knees will, over time, result in increasing the fiscal burden on government rather than decreasing it. In other words, a properly functioning Law Reform Commission can suggest law reforms that will save the government money, and that is one reason why I have serious concerns about the current state of affairs in respect of the Law Reform Commission.

The second point has to do with the ideas that may come to the Attorney General's mind as he thinks about where he's going to take this problem and talks about it with others. I see there is a considerable need for independence in this area, a need to ensure that a body like the Law Reform Commission is a body that, although funded by government, exists outside of and independent of government. So I would not think it is a terribly good idea to move the law reform function in-house -- that is, into government. But when consideration is given to, shall we say, sharing the burden with the Canadian Bar Association and the Law Society of B.C. and other similar organizations, my initial reaction to that is that while that may be a counsel of desperation, it has the signal disadvantage of essentially passing the cost of law reform on to the legal profession. While I understand the need for economy in an era of fiscal restraint, it doesn't seem to me, having regard to the public interest as a whole, that the legal profession should be funding law reform.

So those are comments that occur to me in the context of what I see as a fairly pressing concern. Admittedly, it's not the largest single item of expenditure conducted by this ministry, but it may be one of the more important things that this ministry does within the overall legal community in British Columbia. I encourage the minister to take those comments into consideration.

[2:45]

Hon. U. Dosanjh: I will certainly keep those views in mind when we deliberate over this issue in the next few months and weeks.

G. Plant: I want now to turn to a different subject, and that is the general subject of alternative dispute resolution. In the spring of 1995, the Ministry of the Attorney General promulgated a policy statement under the heading of alternative dispute resolution. I want to ask some questions arising out of that policy statement. The policy statement included within it a list of objectives. The ministry stated in the policy statement that the policy was intended to encourage the development of dispute resolution options by incorporating current initiatives and by supporting new directions in alternative dispute resolution. Building on that statement of principle, the ministry, in this policy statement, stated its intention to pursue a number of objectives. We're a little more than a year past the implementation of this policy, and I wonder if the minister could provide us with a bit of a progress report on the status of the implementation of these various objectives.

Hon. U. Dosanjh: I will mention some of these issues, and if the hon. member requires more details, of course we can provide those to him. This policy was approved in 1995, and the ministry has adopted the following ADR initiatives: small claims court settlement conferences, where judges mediate issues prior to trials -- and that has been very successful; family justice centres, where separating couples can access mediation and other dispute resolution options -- and we talked about that yesterday; mediation between victims and offenders in minor criminal matters; sentencing circles in some criminal matters involving aboriginal peoples; increased use of diversion for less serious criminal matters, and that has also been expanded to the regions now; expansion of the use of disclosure courts -- of course, the hon. member is familiar with what that is; and the training of ministry lawyers regarding the use of alternative dispute resolution in disputes involving the government. Ministry contracts include ADR clauses which are activated in the event of a dispute. The ministry is always looking at any possibilities that may exist in which we could reduce costs and the aggravation of litigation so that we all benefit at the end.

G. Plant: I appreciate that inventory of initiatives.

The policy statement also had an indication that there would be action plans developed prior to October 1995; that before that date the community justice branch and the ADR working group would develop detailed branch action plans to prioritize and implement the policy objectives. Has this been done, and if not, why not?

Hon. U. Dosanjh: This is being done, and part of that is that the ministry has also supported the initiatives in the Provincial and Supreme courts to intervene early and resolve family disputes. Some discussions have been held with the judiciary regarding the further use of ADR in civil matters. At a recent meeting of the federal, provincial and territorial min-

[ Page 554 ]

isters responsible for justice, we affirmed the use of ADR in the justice system and agreed that we should be furthering its use. Those are obviously in the stages where those initiatives have not been concluded; they're ongoing.

G. Plant: One aspect of the work of government in the general area of alternative dispute resolution has been the government's record of support for -- and, indeed, its initiative in setting up -- the B.C. International Commercial Arbitration Centre. The minister will recall that the centre was established by the British Columbia government about ten years ago, and it has since become increasingly important as the cornerstone of a growing infrastructure that relates to commercial arbitration and has had, as one of its objectives, the objective of turning Vancouver into a world centre in the area of commercial arbitration. At the same time, what's been happening gradually is that British Columbia statutes increasingly require or permit recourse through commercial arbitration on a basis which essentially says that you follow the rules of the International Commercial Arbitration Centre and you arbitrate disputes there. Is the minister able to advise us here of what funding his ministry has provided, or what funding has been provided, to the centre since its inception, and what funding is intended for the centre in this current fiscal year?

Hon. U. Dosanjh: I may not be able to advise the hon. member with respect to the total moneys that we have given to the centre, but I can tell him that over $80,000 was contributed last year to its operations, and that was with the understanding that the centre would be self-supporting by the end of the year. I understand that that is not the case. I am meeting with them tomorrow morning, hopefully to look at a possible solution.

Let me think out loud a little bit in that regard. We have a Law Reform Commission which sits separately and has a function of its own. We have another centre that arbitrates disputes. At first blush, one would think that if one put the resources of the two together and tried to make a go of it, there might be a contradiction in their work. I'm going to explore all possibilities to support the work of both of these organizations, if it can be done. If, at the end of the day, there aren't the fiscal resources available -- because there's no money allocated in the budget this year for the centre -- then, of course, the centre will have to deal with the issues on its own. But I would dearly like to be able to help to the extent that I can, because it serves an important function. It sends an important message to those who want to engage in trade and commerce with British Columbia. We will do everything possible to make sure that we assist to the extent that we can.

G. Plant: If I understand the answer, or the statement that the minister has just made, correctly, it is that there is currently no allocation of funding within this fiscal year's estimates to support the centre. Is that correct?

Hon. U. Dosanjh: Yes.

G. Plant: Has the ministry undertaken any analysis of what the consequential fallout costs might be for government in the event the centre were to have to shut down as a result of losing the important source of funding from the government?

Hon. U. Dosanjh: That's a matter that I'm going to be discussing with representatives from the centre tomorrow. There's some dispute as to whether or not there is any cost of winding down to the government; there is some difference of opinion on that issue. I will discuss those issues with the representatives tomorrow.

G. Plant: I take it from the remarks the Attorney General made a few minutes ago that in addition to the issue, which the Attorney General says exists, as to whether there may be any direct monetary cost or exposure on the part of government, there is the large, in my submission, but perhaps difficult to calculate, loss of prestige -- the damage to British Columbia's reputation internationally as a centre for business and also as a potentially high-profile centre for commercial arbitrations. All would be significant losses to our standing in the world community, to our reputation, to all those kinds of things. While actions ultimately speak louder than words, the point is what kind of commitment does the ministry have to ensuring that the commercial arbitration centre continues its work?

Hon. U. Dosanjh: While I take seriously what the hon. member is saying, I think it is important for governments to provide resources so that we have world-class resources available in British Columbia for trade and commerce. I know there are private institutions that do arbitration and flourish in British Columbia. I'm certain that if the opportunity for enterprise existed in British Columbia to the extent that others are flourishing, some of these activities could well be carried out by other institutions that are privately funded. I am cognizant of the concerns, but at the end of the day, I think we have to make these hard choices. I don't know what we're going to do after the meeting that I have with the centre representatives tomorrow. This centre has had at least ten years to become self-supporting. It was with the Ministry of Employment and Investment before it was transferred to our ministry. I understand the significance of it and we'll try to do everything we can.

[3:00]

G. Plant: To coin a phrase used by the minister, I'm "just thinking out loud for a minute." Given that the government through this ministry is committed to the pursuit and the enhancement of alternative dispute resolution, and given that that commitment finds expression in a host of initiatives which are intended to encourage and facilitate alternative dispute resolution in a number of different contexts, one would think that it would not be difficult to imagine various policies or programs that would encourage, for example, Crown corporations to resolve their disputes, by including contract clauses that are arbitration agreements that require parties to arbitrate their disputes at the commercial arbitration centre; and to do similar kinds of things so that government, by means both direct and indirect, in effect provides a source of arbitration work to the commission which is different from a direct grant or subsidy, but has the same effect -- that is, ensuring that the centre gets on a steady and reliable basis the kind of work which would form the foundation of its self-sufficiency. I guess having thought out loud about that, I wonder if the minister or the ministry has given thought to these kinds of initiatives as a means of ensuring the long-term fiscal stability of the centre?

Hon. U. Dosanjh: Yes, we have thought of those kinds of initiatives whereby Crown corporations are being encouraged to utilize the services of the centre. Obviously the centre has to operate on a competitive basis to provide efficient service at affordable prices. I understand that the centre has not been able to attract as much business as it requires to become self-sufficient. That's part of the problem.

[ Page 555 ]

W. Hurd: I hope to be brief in my questions to the minister. I hope to engage him in a discussion of the impaired-driving laws in the province.

By way of introduction, I have with me a newspaper clipping from Parksville, where an individual was handed a four-month jail sentence for the sixth impaired-driving conviction that this individual has experienced. The people in my own riding have asked me to make representation to this ministry with respect to impaired-driving legislation in the province. I know the minister is probably aware that in other provincial jurisdictions, notably Saskatchewan, there's been considerable effort made to toughen the laws regarding drunk driving. I know that some of them cross over into the Motor Vehicle Act with respect to licence suspensions and that kind of thing.

I wonder if, by way of introduction, the minister could advise the committee of what steps are being taken in this fiscal year. What kinds of resources might be devoted to reviewing the drunk-driving laws in the province? I'm sure the Attorney General is aware that police and prosecutors have in the past expressed frustration about the sentences being handed down, the difficulty of court scheduling and the number of cases that are actually brought to trial in the first place. I wonder if the Attorney General could advise the committee of what steps or initiatives might be underway during this fiscal year.

Hon. U. Dosanjh: B.C. in fact has quite effective legislation, including the most severe prohibition in Canada against driving following a conviction: one year. In fact, I don't know whether other jurisdictions have a prohibition as long as one year for a first offence. Also, the conviction rate is pretty good, comparatively, in British Columbia on these offences.

Sentencing. . . . I can tell you, hon. member, I have similar concerns, but I am unable to, and of course I must not, criticize the judiciary. Those sentences are contained in the Criminal Code of Canada, and the Minister of Justice, Alan Rock, is aware of all of the concerns that people in British Columbia have expressed. I was in Prince George several months ago in the pre-election period and I met with a group of individuals and families that had lost loved ones to impaired-driving accidents. I am concerned about the issues that he raises.

We also have legislation in British Columbia -- we passed it in 1995, and I believe it is going to be proclaimed this fall -- which includes a prohibition from driving, allowing a police officer to prohibit from driving for a 90-day period any driver who fails or refuses a breathalyser test. A police officer would be able to do that. There is vehicle impoundment for 30 days on the first offence and 60 days on subsequent offences for driving while prohibited. And, of course, there's graduated licensing, which provides for zero alcohol tolerance for new drivers, and that new drivers with a blood-alcohol level of over zero will have their licences suspended for 30 days.

So those are some of the initiatives that are contained in that legislation which will be proclaimed this fall.

W. Hurd: Can the minister tell us whether his ministry intends to review other jurisdictions in the country? I'm specifically referring to new legislation that came onto the books in Saskatchewan as of August 1, in which, among other things, the blood-alcohol limit for roadside suspensions was lowered to .04, and there is mandatory education and addiction screening for drivers who exceed .04. There was a requirement that people with convictions go through some sort of mandatory. . .re-education is not the word I'm looking for, but perhaps mandatory counselling or mandatory substance abuse types of courses. I know they exist in Washington State and are now being enacted under this new legislation in Saskatchewan. Does he see a need to require drivers with perhaps multiple convictions to be required to go through this type of mandatory counselling, or mandatory medical screening, before their licences are reinstated? Could we possibly look to that kind of initiative from the ministry, perhaps in connection with sentencing or some other type of arrangement?

Hon. U. Dosanjh: I'd be certainly prepared to look at it. The primary responsibility for that rests with the Ministry of Transportation and Highways, but I would be prepared to look at that, and ask my ministry to look at that. The difficulty -- and we discussed this yesterday -- with mandatory treatments or mandatory counselling is one that can only be resolved federally by way of a change in the Criminal Code of Canada. However, I've just been advised that we could look at the possibility of the renewal of a driver's licence being conditional upon a convicted driver having taken a series of counselling sessions or some medical treatment, and I would certainly be looking at that.

W. Hurd: Just a brief further question on that point. In a case where the courts have ordered a suspension of the licence, would the Attorney General's ministry have the ability to order mandatory counselling -- where the licence has been suspended as part of a judgment by the courts?

Hon. U. Dosanjh: I would certainly be prepared to look at that. There may be some questions as to the constitutionality of such legislation if that legislation kicks in as soon as a driver's licence is suspended. But I'm advised that we will look at that, and I will make it a priority.

W. Hurd: I know there is considerable pressure, as the minister knows, from the victims of drunk drivers and their families to bring the laws into compliance with other jurisdictions which, despite the changes in British Columbia, do have a significantly tougher regime for drunk-driving offences, particularly where the person is driving with a licence under suspension -- and I look forward to that.

I had one other series of questions on the provincial emergency plan -- I don't know if the right officials are here. I had occasion last year to serve on the Premier's committee reviewing the closure of CFB Chilliwack, and certainly it was an eye-opener to me, in terms of what kind of emergency response plans existed out there and how critical that facility was to those plans and the fact, of course, that it will no longer be here. I just wonder if the ministry intends, during this year, to review the protocol agreement between the federal and provincial governments, which, as the minister knows, requires the federal government to provide assistance in the event of civil unrest, natural disasters or other types of calamities, and seek assurances from Ottawa that, in fact, their commitments under that agreement won't compromise our emergency response plans in British Columbia.

Hon. U. Dosanjh: I understand that the ministry is reviewing this matter. As soon as our own review is complete as to what the possibilities might be, we will be speaking to Ottawa on this issue.

[ Page 556 ]

W. Hurd: I just wanted to ask the minister if, in the case of Gustafsen Lake -- which I understand is before the courts, and the minister is not at liberty to comment on that -- he can confirm whether or not Ottawa did provide aid in that situation under this protocol agreement. I'd be interested to know whether or not -- and if so, how -- aid in that situation unfolded.

Hon. U. Dosanjh: This is not to evade any questions, but that's a rather complex issue. For me to be able to give you a correct and exact answer, I would have to go back over the events of last year myself -- and I haven't done that. I am very leery of providing an answer to you, particularly as the court is sitting and hearing this matter and this issue is being testified about before the courts. So I would beg the hon. member to not ask me any further question unless he feels that it's urgent for him to know.

W. Hurd: I can appreciate the minister's caution. He has indicated that the provincial emergency response plan, as it relates to the protocol agreement, is under review. I would hope that as part of that review the Gustafsen Lake situation will be reviewed as well, in terms of, if there were incidents such as that in the future, whether or not the fact that the base is now located in Edmonton, Alberta. . . . I'm aware that CFB Chilliwack did on that occasion provide assistance to the RCMP. I was just curious as to how that assistance and aid had arrived, and whether or not the fact that we now do not have that capability in British Columbia would in any way, in the estimation of the Attorney General, compromise the future ability of the ministry or the RCMP to respond to an emergent situation like the one we faced at Gustafsen Lake.

[3:15]

Hon. U. Dosanjh: We shall certainly review all of the concerns raised by the hon. member. Once we have completed the in-house review, if the hon. member is interested, I can ask the ministry at that time to inform him of what we have discovered and determined, and what we will be placing before Ottawa.

D. Symons: Since the question of provincial emergency preparedness came up, I have a question on that. I notice that in the last few years the funding has been fairly constant -- around the $2 million range. Vote 20, professional services, is $524,000, and vote 50, utilities, $286,000. We're getting up to about $800,000. I also notice under vote 95, other expenditures, we have $1 million, so roughly 50 percent goes under other expenditures. It seems rather vague. I wonder if the minister might give us some flavour for what those other expenses might be -- other than the line items in the book.

Hon. U. Dosanjh: In the explanatory notes on page 113 of the supplement there is, of course, a definition of STOB 95, "Other Expenditures." Those are other expenditures that cannot be reasonably allocated to another standard object of expenditure. Those are for emergencies -- could be for salaries during emergencies, could be for other purposes during emergencies.

D. Symons: I don't think it really answers the question. It seems that when you look at the book you've got 50 percent of it listed as other. There must be some flavour of the type of other besides the salaries and the things you've mentioned, I'm sure.

I have a specific interest in earthquake preparedness, coming from the great community of Richmond. I wonder if the minister might be able to give me an idea of what money in the budget allocated this year to provincial emergency preparedness is going toward earthquake preparedness or earthquake studies and would enable us in Richmond and other areas in the lower mainland to be better prepared in case we do have an earthquake.

Hon. U. Dosanjh: I don't think there's any specific money set aside that will be spent in Richmond in this regard.

With respect to the earlier question the hon. member asked, it is not necessary that we spend the money under STOB 95. That money may sit there, and if there is a disaster, we may spend many times more. In a disaster one doesn't know what one requires in advance, of course. So that, in a sense, is a contingency fund for emergencies.

D. Symons: I wasn't asking specifically what moneys might be spent in Richmond on earthquake preparedness or earthquake studies, but provincewide. You must have some money that's dedicated through emergency preparedness for dealing with the problem of earthquakes -- either in studies or preparedness. Could you give us an idea of how much that might be?

Hon. U. Dosanjh: There are many initiatives always going on with respect to earthquake preparedness. I know there is a committee that the hon. member who spoke previously was referring to. As the Premier's representative, I attended meetings of that committee that talked about preparedness overall in terms of the entire province.

Let me just give you one example of the kinds of things that are happening. Cabinet approved conducting a regular program of exercises in the Thunderbird series. Thunderbird 2, practising and evaluating provincial response on southern Vancouver Island, is scheduled for the fall of 1996. That is going to take approximately $60,000. It is those kinds of activities that are being organized on a regular basis across the province, dealing with different kinds of possible disasters that may occur.

D. Symons: Just one last question on that, then. If we look across the various STOBs, you're basically saying it's spread across those, and there isn't a specific amount that's dedicated to earthquakes. It's just coming out in all the various preparedness. . . . One of them may be on an earthquake, one of them might be on civil disobedience or civil disorder, and the other one might be a local disaster of some sort that has occurred. But there's nothing specifically for earthquakes; it's just that all of those are lumped together.

Hon. U. Dosanjh: Yes, I'm sure they are focused on different kinds of things in different areas. But just one note: the exception is that we don't deal with civil disorder. Other than that, all the emergencies obviously are dealt with.

G. Plant: The subject I want to turn to is the general subject of the implementation of the package of legislation that includes adult guardianship. In the 1994-95 accounts for the office of the public trustee, there is provision made for a funding transfer from the Ministry of Attorney General to the office of the public trustee. It is in the order of $2.4 million. I'm not certain if this funding transfer is expected to continue into the current year. My first question, I suppose, is this: is this the

[ Page 557 ]

mechanism through which the Attorney General is, shall we say, funding the ongoing review that relates to the implementation of the package of bills that includes the Adult Guardianship Act?

Hon. U. Dosanjh: There is $3.8 million in total, and $1.1 million of that is adult guardianship money. There will be an independent review of the Representation Agreement Act. There is some divergence of opinion in the communities that these pieces of legislation were intended to serve. Much of what we were going on with is essentially on hold until I'm able to have an independent review done. We have not selected the individual or individuals who will do that review. As the four pieces of legislation we're talking about are far-reaching in terms of their impact, I want to make sure that the communities they serve are on-board and are accepting all of what is being done. It has come to my attention during my short tenure as Attorney General that there are some problems. I've committed myself to an independent review before we proceed any further.

G. Plant: What is the Attorney General's timetable for appointing the individual or individuals who will conduct this review, for setting the terms of reference, for getting the review underway, and for completing it?

Hon. U. Dosanjh: The communities affected, at least some of them, want me to be able to do this within a month. My fear is that it may take up to six months.

G. Plant: I suppose one could say that another way: speaking conservatively, your expectation is the review will be completed within six months.

Hon. U. Dosanjh: Yes.

G. Plant: The minister, I think, is probably more aware of the existence of divergence of views about this legislation than I am, and about the nature of the views that are being expressed. One concern that I am aware of relates to the ability of those who may enter into representation agreements, and who expect to have the right to represent individuals -- if I can put it that way -- pursuant to those agreements, to deal in good faith with financial institutions. I think specifically the concern relates to section 24 of the act. This is an issue around implementation of the legislation as much as anything else. Is this a concern that the Attorney General is aware of? Is it something that he intends to incorporate into the review which he is intending to get underway?

Hon. U. Dosanjh: I have received several concerns, and the concern expressed by the hon. member is one of them. I have not yet determined what the embrace of this review would be -- how large. We spent a lot of resources, time and energy -- all British Columbians did, many of them who participated in this exercise -- coming to the stage we're at in having these four pieces of legislation actually passed through the Legislature. That's an issue that I'm going to have to contend with in the next few days and weeks, to commence this process. I'll be looking for help from the hon. member.

G. Plant: I am aware that another concern that has been voiced is around the costs that have been incurred in the implementation to date. I am sure the minister has heard this concern. I must say that when I'm thinking about this concern in the context of some of the discussion we had earlier today in which agencies like the Law Reform Commission are at risk because of a couple of hundred thousand dollars in funding. . . . It looks like several million dollars has been spent on the work to attempt to implement this legislation. I don't necessarily want to get into the details of that, but the expenditure which the ministry and the office of the public trustee have incurred to date in respect of implementation costs. . . . I want to know whether or not the minister is intending, in the near future, to ensure that there is a review of these costs and that there is some accountability in respect of them, and if there has been some disclosure of what has been done over the last three years to implement the statutes.

[3:30]

Hon. U. Dosanjh: I understand that there is an internal review underway of the expenditures incurred in this matter. We don't have the results of that as yet, but the $1.1 million that I mentioned earlier has been frozen until we get the results of the review and determine what the best course of action would be in terms of proceeding.

G. Plant: The question arises, then, whether the minister intends to make the results of the internal review public. I suppose that one aspect of the issue is that there are people in the community who have devoted countless hours as volunteers to try to help bring these statutes into force in the way that they think they ought to be brought into force. The ministry has been spending money all along, perhaps doing the same thing. There may be work product resulting from studies done which ought to be out in the public domain, or there may not be. But if the ministry has been spending this money, there presumably has been some result that we ought to know about.

Hon. U. Dosanjh: It is, of course, the office of the public trustee that has been spending this money. I haven't considered the issue of making the results of the review public, but I'll certainly consider it when I have the review in hand.

G. Plant: One of my colleagues has an interest in this subject and has a question or two.

V. Anderson: I've had an opportunity to attend a number of the community meetings of the people who are concerned about guardianship and representation on the very issues that you've been discussing. I want to stress the urgency and the anxiety of those people, who had expected to have the legislation implemented by this time. They have expressed grave concern about the directions in which the regulations have been going, as well as great dissatisfaction that they haven't been heard recently -- or don't feel that they have been heard.

I wanted to convey that to the minister and to say that I think it's very important that what the hon. member has been saying is out there. . . . There is grave concern that the money in preparing for the program will mean that there's no money left to actually put the program into practice, and all the work will have gone for naught. I think it's very important that very quickly, like yesterday, there be some report back to these people, because there's a feeling that they're just being stalemated at this point. I'm wondering if the minister can give us any hope that there will be a follow-up fairly quickly and affirmatively; that this issue, which has dragged on so long, can be dealt with fairly quickly; and that there can be an open dialogue again about solving this situation.

[ Page 558 ]

Hon. U. Dosanjh: I met with various representatives earlier on, and I've heard divergent views. I am also concerned about the state of anxiety that exists out there in the community. I know that it would take a bit longer, but that's exactly the reason why that independent review is going to be done in the draft regulations of the Representation Agreement Act. I want to do it if at all possible, but I want to do it right. Hopefully, that wait we have to tolerate will not go unrewarded at the end. I'm concerned, and I understand the hon. member's concerns as well.

V. Anderson: Could you indicate the nature of that review and how people. . .? Will it be strictly internal, or will there be an opportunity for people to be part of that review and have input externally?

Hon. U. Dosanjh: We're now talking about two reviews. The internal review is being done within the ministry. That is not a public review, and the results may or may not become public, depending on. . . . I want to take a look at it. My inclination is always that if things can be made public or ought to be made public, they should be.

With respect to the other review, that is going to become a much larger one, because that's where the concerns of many of the people who have divergent views on implementation and how it should proceed will converge. Hopefully, all of those would be taken into account.

V. Anderson: When is that external review going to get underway? Are people going to buy into that? What will be the process of that, so that people could be informed and prepared for it?

Hon. U. Dosanjh: I mentioned earlier that although the community coalition would like to be able to do this in one month, my fear is that it may take up to six months. That process needs to be gone into with some care, and all views need to be listened to. I want to make sure that at the end of the day, we have a process that's not bureaucratic, that's not cumbersome, that doesn't create any more anxiety among the seniors, in particular, than they have to have. All of those issues are uppermost in my mind.

We haven't determined who the individual is going to be and which individual or individuals are going to conduct that review. We want to make sure that the review is open to the views of everyone that would be impacted.

G. Plant: I want to move on to the subject of the extension of the social service tax to legal services. I'm sure that the minister continues to hear concerns from members of the legal profession about this. I can add my voice and one piece of anecdotal evidence, which is an incident that occurred in my former life, not very long ago, where a litigant resident in the province of Alberta expressed to me strong reluctance to sue in British Columbia and a strong preference to commence an action in the Federal Court of Canada because he didn't want to pay the damned tax -- I think that is not exactly what he said, but pretty close to it. It occurred to me that it might be another classic instance of penny wise, pound foolish. It might be driving income out of the province.

The more serious question -- and it may not be for you, because the tax is probably not collected by you. . . . The question for the Attorney General, if he knows, is: how much tax was collected from lawyers last year, and what's expected to be collected next year?

Hon. U. Dosanjh: As the hon. member correctly points out, that's an area that I don't deal with, thankfully. But we collected in the range of $73 million last year, and I don't know what the projections are for next year. I'm sorry that my hon. friend's client didn't want to pursue litigation in British Columbia, but maybe you were better off at the end of the day not incurring the court costs.

G. Plant: That's an interesting observation. [Laughter.]

Hon. U. Dosanjh: I don't mean to take business away from you, but. . . .

G. Plant: Actually, taking away business wasn't the issue. It was where the money was going to be spent -- whether it would be spent in Alberta or British Columbia. I'm sure the minister would prefer that if people were going to spend money on legal services, it would be better for the economy of British Columbia that they do so here rather than Alberta.

But the question that may, in fact, fall under the minister's bailiwick is whether, within his ministry or, to his knowledge, in any other ministry, there have been any studies done of the effect of the implementation of this tax on the general provision or delivery of legal services within British Columbia.

Hon. U. Dosanjh: Not to my knowledge.

G. Plant: Is there any intention to undertake such a study at the present time?

Hon. U. Dosanjh: No.

G. Plant: Is the hon. minister able to indicate whether, in calculating the estimates of revenue for the Ministry of Attorney General, account is taken of the revenue which is collected from this tax and any kind of. . .not allocation within programs in any technical sense, but in a general sense. . . . Is there any kind of connection between, on the one hand, the determination of how much money the Ministry of Attorney General is going to spend and, on the other hand, the amount of money which the government, generally speaking, is collecting through the imposition of this tax?

Hon. U. Dosanjh: I don't believe anyone in government makes a direct link between what we collect from PST with respect to legal services and the budget of the Ministry of Attorney General. But I'm sure the hon. member understands that the government has been able to maintain and in fact substantially increase funding for legal services over the last four or five years. Not that one wants to make a connection between the two, but obviously the money is being well used, if one looks at just that one instance.

[3:45]

G. Plant: That was as close to making a connection without making a connection as I expect the hon. minister could go. I thank him for the answer to that question.

I want to return to another subject. It's a subject that was canvassed yesterday in the context of the questioning in relation to liquor licensing. It's the issue of U-brews. I've had drawn to my attention the fact that during the course of the media interest in this subject last spring, the Attorney General expressed himself publicly on this issue on more than one occasion, I'm sure. It's fair to say the minister's statements have created some uncertainty out there in the world about 

[ Page 559 ]

what, if anything, is intended to be done here. I'll read one quotation, which apparently comes from the Times Colonist of April 3 of this year. The quotation attributed to the Attorney General is this: "U-brewers themselves are anxious that the government ensure their business is conducted in the safest possible fashion." The question really is: what are the minister's intentions, if any, with respect to regulation or licensing in the arena of U-brews during the current fiscal year?

Hon. U. Dosanjh: I really have no formulated intention to do one thing or the other at this point. In the quotation attributed to me in the Times Colonist, I was simply referring to a statement of fact, which was that U-brews approached me and asked me to attempt to regulate them to the extent that they could conduct their business in an environment which would be beyond question of any illegalities. That's all I was expressing. Of course, they were concerned. I heard them, and until I'm persuaded one way or the other, I don't have any course of action that I've chosen.

G. Plant: The question for the minister arises out of something that in this article is not a direct quote but is a general attribution. The paragraph in the news report reads as follows: " 'The U-brews will likely see new government regulation,' said Attorney General Ujjal Dosanjh on Tuesday, who added his staff is 'working on it.' " I probably have about as much faith in the accuracy of news accounts as the minister does. Nonetheless, when people out there in the community read newspapers, they sometimes believe what's said in them. Having added that bit of information to the discussion, I take it that what the minister said a minute ago remains the case -- that at the moment there are no current specific plans to undertake any initiatives in this area.

Hon. U. Dosanjh: That's true. But from time to time, when I'm approached by various representatives of any industry that I deal with, I raise the questions with my ministry and ask them to respond. I have not decided upon a course of action, nor has this government, in any way, shape or form, on this issue. I don't believe that you're going to be seeing any regulations in the very near future.

G. Plant: One of the statutes the Attorney General is responsible for is the Ombudsman Act, although the expenses associated with the operation of the ombudsman's office are not part of the estimates of the Ministry of Attorney General.

I recently had the pleasure of meeting both the ombudsman and another of the officers of the Legislature, the information and privacy commissioner, whose statute is not one of the statutes your ministry is responsible for. Both of these individuals who hold important positions have expressed to me a concern that there is no direct mechanism in place of accountability to the Legislature for the work they do on an ongoing basis -- the kind of accountability that exists, for example, in the context of the estimates debate, when the expenditures of Attorney General are at issue. While I suppose it's not an entirely appropriate subject for estimates, I didn't want to conclude my opportunity to engage the minister on the general subject of the activities of the Attorney General without leaving with him the thought that he look at the issue of whether the ombudsman -- and it's really only the example of the ombudsman; it may also apply elsewhere -- should have, for her benefit, some mechanism or change to the way in which she is accountable to the Legislature on a more regular basis for the work she does.

Hon. U. Dosanjh: I understand the thrust of the hon. member's concern. I believe that's a question for the House to contend with. I think that if one ministry contends with it, it becomes less than simply being accountable to the House. I believe there is a mechanism in the Public Accounts Committee. All committees of the House can summon witnesses to appear before them; I had never considered this until the hon. member mentioned this. Perhaps there might be a way where the Public Accounts Committee or the Parliamentary Reform Committee might decide to summon the officers of the Legislature to appear before them and account for their activities.

I'm simply wondering out loud. That's not my definitive opinion, but that's the direction I would look in.

G. Plant: I want to take this opportunity to again express my thanks not only to the Attorney General but also to the various branches of his ministry and the deputies who have assisted in the course of my participation in the debate.

There are still a few more questions that some people have.

D. Symons: I have one very quick question -- maybe I'm asking the wrong minister. It's about consumer affairs, in relation to legislation about unsolicited goods and laws against that. We had a situation a year ago with a provider of television services changing the rules, I guess, in a negative-option arrangement. Does that come under your ministry? If it does, I'm wondering if you're considering tightening the negative-option sales technique even further than was done regarding the situation I'm referring to in television sales last year.

Hon. U. Dosanjh: I'm somewhat familiar with what happened a couple of years ago. I'm prepared to look at the concern of the hon. member if he's able to express it to my staff, and then I can advise him as to whether we need to go further than we have gone in terms of legislation. I would like to know the specifics, and maybe we can do that in another arena.

K. Krueger: It is a pleasure and a privilege to have the opportunity to ask a couple of questions of the minister. I hope I am not out of order in stating that of all the ministers on the government benches, this is the one I personally most admire. It's good to have an opportunity to speak with him.

My role, assigned by the Leader of the Opposition, is to be the opposition critic for gambling, the B.C. Lottery Corporation and the Gaming Commission. I'm not sure if the right people are in the room to deal with that.

Hon. U. Dosanjh: The hon. member may be with the right minister for some aspects of it. In general terms, the Lottery Corporation, the Gaming Commission and all those institutions that deal with regulation of gaming are with the Ministry of Finance. In the Ministry of Attorney General, there is simply the audit and investigations unit for gaming, which is the enforcement unit. So you have the enforcement-of-law aspect with us, while the actual regulation and the policy issues are all with the Ministry of Finance.

K. Krueger: I thank the minister for that response, and I have noted that. As I travelled through the estimates, I felt as though I was pursuing something of a game of chance myself, because there are so many different ministries that have been involved in gaming in the past year: Labour; Government Services; Sports; Multiculturalism, Human Rights and Immigration; Finance and Corporate Relations; and the Attorney General ministry.

[ Page 560 ]

An Hon. Member: Bingo was widely held. [Laughter.]

K. Krueger: I did feel as if I was on something of a bunny trail.

There is $1,230,982 included in that ministry's operations, albeit a very tiny portion of the overall budget. I have a few questions. Will it be in order to proceed? Out of that sum I just quoted, I wonder if the Attorney General could give us just a brief outline of how the whole matter of auditing and investigation of gaming is pursued by his ministry.

Hon. U. Dosanjh: With respect to gaming, there might be some inspections, some audits or some investigations by the audit and investigations branch. For instance -- I don't really want to raise this issue, but I will raise it by way of an example -- when the Attorney General dealt with the issue of the social clubs last year and essentially withdrew the authorization under the Criminal Code from the Gaming Commission to continue to license social clubs, certain evidence was put before me. Much of that evidence came from the audit and investigations section of the gaming establishment. That is the kind of work they do. They have continued to pursue the closure of the social clubs, which, with respect to gaming, is due to expire at the end of August this year. Simply by way of example, that is the kind of work they would do. There would be audit investigations and inspections.

K. Krueger: I wish to inquire whether there is a planned sequence of audits in the various gaming areas. Are they done as issues arise, or is there a process of random sampling for audits?

[4:00]

Hon. U. Dosanjh: I understand there would be some proactive auditing, mostly random, and some reactive auditing that they engage in from time to time.

K. Krueger: I'd like to know whether the auditing includes auditing of the B.C. Lottery Corporation itself, or if that is done by another ministry or agency.

Hon. U. Dosanjh: The Lottery Corporation as a Crown entity is audited by the auditor general, but in terms of the gaming establishments -- the machines and the like that the Lottery Corporation approves and allows commercial establishments to keep, and which allow the public to participate in gaming -- the audit and investigations branch would have a function to perform at the behest of the Attorney General.

K. Krueger: This is my first time down these trails, as I'm a new member. I wish to ask the minister if there are other areas of his budget that deal with gaming audits and investigations other than the one that I've referred to. Is this the total allotment?

Hon. U. Dosanjh: This is it.

K. Krueger: I have had a great deal of input from constituents in my own riding and in other ridings about the issue of problem gambling and the gambling addictions that develop. I've had inquiries as to what the government does about this, which is a very severe problem in some families. Certainly there would be consequences of the problem, if substance abuse, addictions, and so on result in crime. I wonder if this ministry has the budget and programs to deal with those issues.

Hon. U. Dosanjh: I recognize the problem that the member refers to. When I was the Minister of Government Services, one of the reasons we made the decision not to allow VLTs into British Columbia was fear of the problems that the member is talking about. That issue appropriately rests with the Ministry of Health and the Ministry of Finance.

K. Krueger: I'd like to inquire whether this ministry has any role to play in complaints by charities and whoever would apply to run a bingo or casino, for example, or games of any kind. I receive complaints from people who feel that their requests are held up too long, or that they don't receive permits frequently enough.

Hon. U. Dosanjh: Those are activities that are regulated by the Gaming Commission, which is in fact at arm's length even from the Ministry of Finance, although it resides in the Ministry of Finance.

K. Krueger: Would all audits of individual societies, and their bingos and casinos and so on, be conducted through the B.C. Gaming Commission rather than through this ministry?

Hon. U. Dosanjh: Through the audit and investigations branch of the Attorney General ministry.

K. Krueger: It would seem to me, then, that there would very many audits to do, unless they're done on a very occasional basis for each charity or on a very small percentage of the actual events. I wonder how those decisions are made.

Hon. U. Dosanjh: The Gaming Commission personnel would do regular paper audits, in-and-out audits. Any investigative audits would have to be done by the branch in the Attorney General ministry. Of course, they would be reactive in those instances, but in some instances they could be proactive if there is a suspicion that there might be a problem.

K. Krueger: I take it, then, that there are no investigative audits done on a purely random basis. It sounds as though the reactive ones arise out of a complaint or a suspicion.

Hon. U. Dosanjh: No, there are some that ought to be done, and will be done, on a random basis. That's what I mean when I say proactive: without any particular complaints. I think that there need to be spot audits, if that's what you mean.

K. Krueger: How many of those have been done in the last year?

Hon. U. Dosanjh: I'm not aware of whether there were any last year. This branch has just come to the Attorney General ministry, and we are attempting to set it up. There will be, of course, a program of these in the coming months and years.

K. Krueger: I'd like to know whether a goal has been set as to how many of these random investigative audits are likely to be done over the course of the coming year.

Hon. U. Dosanjh: Those kinds of goals are being established now, and we may be able to advise the hon. member in the next two weeks as to what the goals might be. Of course, some of that information, as to where and when, is strategically confidential.

[ Page 561 ]

K. Krueger: That answer makes eminent good sense to me. This next question may again be a matter that the auditor general would deal with -- and obviously I'll be told that in short order if that's the case. I see income from gaming reported in various places in the estimates: horse-racing income, for example, at $6 million; public gaming licences and permits at $21 million; B.C. Lottery Corporation income at $262 million. I wonder if the minister has any responsibilities for ensuring that those numbers are accurate, and if there are any other income figures I'm overlooking.

Hon. U. Dosanjh: The Attorney General does not have any responsibility in that area. That, I believe, appropriately resides with the Ministry of Finance.

K. Krueger: In the area of gambling on aboriginal reserves, casinos and mega-bingos, these issues. . . . I'm not clear what the government's expectations are for the coming year, whether the government is aware of issues that appear to be arising, and whether there is a budget and employee allocation for dealing with those problems or the programs underway.

Hon. U. Dosanjh: While all of those issues reside with the Ministry of Finance, I can advise you, hon. member, that issues with respect to casinos either on reserves or off reserves. . . . Those are decisions that are made at arm's length by the Gaming Commission. The Attorney General's responsibility is, of course, to enforce the law, and if there are any illegal activities, whether they're on reserve or off reserve. . . . If they're in breach of the Criminal Code of Canada, the Criminal Code will be enforced.

K. Krueger: Since nothing has happened to date, perhaps this question won't be answerable. I'm told that a casino is intended for the Osoyoos area on an aboriginal reserve. I wonder if the Attorney General ministry is already dealing with that issue and whether there has been any budget allocation for the legal expenses and so on that would arise.

Hon. U. Dosanjh: Hon. Chair, those kinds of expenses are in the normal course of business of the criminal justice branch and policing in British Columbia.

K. Krueger: I take it there is no necessity to budget ahead for anticipated problems of that nature.

Hon. U. Dosanjh: It's not usually done.

K. Krueger: I'm getting close to the end of my questions. From the Attorney General's point of view, with the responsibility to investigate and audit and oversee the legalities of gaming, is he aware of any intentions on the part of the government to expand gaming, which would necessitate an expansion of those audits and his expenses?

Hon. U. Dosanjh: I think those are questions that appropriately should be put to the Minister of Finance.

K. Krueger: In the area of the problems that arose, and the charges and convictions that resulted, in Nanaimo from activities of the Nanaimo Commonwealth Holding Society, I would like to know if the Attorney General ministry has made any recommendations, or has any plans, or has set aside any moneys, to deal with the prevention of abuses like that ever happening again.

Hon. U. Dosanjh: Hon. Chair, there is a special prosecutor in place, an investigation ongoing by the RCMP, and there is the Nemetz inquiry. I don't believe that it is appropriate for anyone to be making any arrangements other than, of course, making sure that we see the inquiry through -- and the prosecution and the investigation that's going on -- in an independent fashion.

K. Krueger: I believe that the member for Peace River North is waiting to put some questions. I pass the floor to him.

R. Neufeld: I only have a few questions. The leader of the Reform Party asked some other ones that had to do with both our constituencies, but. . . . Approximately a year ago, I contacted the ministry in regard to non-custodial parents -- a group of parents not specific to the Peace River, but in the north -- that had some concerns about how the family maintenance program is operated.

Just to refresh the minister's memory, what would happen is these individuals, as I am told -- and I never checked it out, but I would assume. . . . They were on the record publicly as saying that they had maintained all their payments for family support and those kinds of things. In many cases, the children lived elsewhere in the province -- either in the Okanagan or on the lower mainland. Visitation rights were prescribed by the court, and times were arranged. When the spouse arrived in either Vancouver or Kelowna, he found the children gone with the mother and he had to return back home, of course at great cost. Your holidays are gone, and you haven't had your visitation rights with your children. They inform me, probably quite correctly, that visitation rights and the maintenance program -- the payments being made -- have a direct correlation. If you're making your maintenance payments, hopefully you're getting the other side of the deal, which is visitation rights.

[4:15]

The minister was kind enough to respond in early April of this year and informed me that there was a pilot project consisting of four community family justice centres, which began in 1994, actually, and that there is an independent evaluation of the pilot project now being completed. It has to do with mediation and that kind of thing, with family maintenance and non-custodial parents. I wonder if maybe the minister could tell me, so that I can take it back to this group, what's transpired. As he states, it was being completed at the time, and that was in early April.

Hon. U. Dosanjh: The evaluation is in. I understand that those projects, those centres, have been a tremendous success. In fact, one element of that pilot project is the parent education element, a six-to-eight-week course where parents learn the techniques of resolving their differences amicably even if they're separating. So they don't have this lingering animosity at the end of the day that impacts not just on their right to see the children but also on the children's right, which is more important than the parents' right, to be able to see either parent. It also educates the parents to disconnect in their own minds the question of maintenance from the question of access. Access is as much a right of the parent -- if not more, in fact -- as it is the right of the child to see the parent.

That six-to-eight-week parent education program is going to be spread across the province as much as we can, with some savings to the tune of about half a million dollars that we have made with the efficiencies from that program. I'm hoping that at the end of the day we in British Columbia 

[ Page 562 ]

can move some of these litigious exercises out of the courtrooms and back into mediation and conciliation rooms, so that the children, at the end, aren't impacted adversely. In all of these situations, parents -- adults -- can fight with each other and have animosities; it is the children who suffer in the long run.

R. Neufeld: I agree totally. The savings to the court system would be tremendous if we can have some type of mediation process. So I'm delighted to hear that the pilot projects were successful.

Could the minister maybe just broaden it a bit more? Are we looking at. . .? You say provincewide, hopefully, as money permits. Are we talking about that within the next year? Are we talking about provincewide being all the way to the north? Or just how far are we going to take this? And what kind of time frame is it, so I can get back to these individuals and let them know?

Hon. U. Dosanjh: I'm unable to tell the hon. member how soon we can expand to areas such as the north. I think it will depend on the demand in the particular area, as well as even the availability of resources, perhaps. It would be my hope that we could go into all of the major regions of the province and make these programs accessible to most people, if they need them. This would also save us money in the court services area.

R. Neufeld: Well, I'll send a copy of Hansard to the members and let them know that there is something taking place. I will continue to keep in touch with the minister regarding that issue.

The second issue is that I would like to ask the minister, as the Attorney General, what the Attorney General's responsibility is if he knows of a corporation or individual that's breaking any statute or law in British Columbia. As the Attorney General, what would be the next step for you to take?

Hon. U. Dosanjh: It would be my obligation, as it is the obligation of anyone in British Columbia, to advise the police. In my case, as Attorney General, if I knew of something going on, I'd perhaps even talk to the criminal justice branch so that they could speak to the police.

R. Neufeld: I would assume that it would then be up to the RCMP, in most cases, to lay a charge against a certain individual or company that was breaking the law.

Hon. U. Dosanjh: The RCMP or the municipal police forces make decisions upon receipt of any information as to whether or not they would conduct the investigation. If the investigation is successful, they determine whether or not to recommend charges to the Crown. It is then the Crown's responsibility to weigh the information, based on the charge approval process, which has two elements: it has to be in the public interest and there has to be a substantial likelihood of conviction. Of course, if the Crown so decides, the charge then ends up before the court.

R. Neufeld: Would it be safe to say, then, that if the government of the day was breaking the law -- a ministry was not following the statutes of the province -- that the same procedure would take place? Would that be correct to say?

Hon. U. Dosanjh: I think the hon. member is asking a general question. There can be many statute violations which don't necessarily have criminal consequences. I'm a bit leery of answering the questions in general terms, and I don't want to talk about a particular case, either. So let me just generally say that if the hon. member is pursuing a line of questioning, then I am presuming that he knows what he's talking about. Instead of actually raising the issue with me, he should go to the police.

R. Neufeld: It's interesting to go to the police, but the government of the day -- your government -- created a park, Tatshenshini, in 1993. In doing so, it expropriated the rights of individuals to carry on the business they had been doing in that area prior to that -- one being a large mining firm. To my knowledge -- and I can only go by what I read in the paper, and I don't know whether I believe everything I read in the paper. . . . I understand that the government of the day has reached some agreement with that large mining firm. What have been left out of the whole process are small individuals, the small placer miners, and the government of the day is actually not following the Expropriation Act to the letter of the law. I'm going to read into the record the Expropriation Act -- what it says should happen:

"The expropriating authority. . .shall pay to the owner the amount the expropriating authority estimates is or will be payable to that owner as compensation, other than for business loss referred to in section 33(3), and. . .serve on the owner a copy of all appraisal and other reports on which the payment is based."

Obviously what's supposed to happen, as I read this, is that the government is supposed to make an educated guess as to what the costs will be, or what value the right to mine in that area has when you're expropriating the land, and pay that up front and then negotiate, and the owner is able to appeal. I know of one for sure -- and I have it in my hand -- where that's not taken place. In fact, this business has never received one red cent, and it has incurred a tremendous amount of legal costs in trying to deal with government. Obviously there must be quite a few more. I wonder how the government can circumvent its own statutes when individuals or corporations are not able to and in fact can be charged for doing those types of things.

The Chair: I wish to advise the member that questions of this type involving legislation ought not be brought before the Committee of Supply, especially when we're dealing with estimates. If the minister wishes to reply to this question, he may do so, but properly, according to our rules, this line of questioning ought not be brought before Committee of Supply.

Hon. U. Dosanjh: I just want to say this to the hon. member. He broached this subject with me yesterday, and I indicated to him that I will get someone from the legal services branch that is dealing with these issues to speak to him so that the process can be explained and perhaps even expedited, if that is the legitimate thing to do.

I think it's important for the members to be able to air their concerns, and I would be happy to answer to the extent that I can. But because of the fact that it's a particular case, it's being handled. . . . I don't know whether it's before the courts or not, but I don't believe it's appropriate for me to comment on these issues. I will undertake to have someone from the legal services branch speak to the hon. member and try and resolve any questions that he might have as to the process or the tardiness of the process.

[ Page 563 ]

R. Neufeld: I have talked just recently with the Attorney General, but the Attorney General was made aware of this a long time ago by legal counsel for the company that I'm talking about. I certainly don't want to get out of order in the debates -- and would almost think, if I went through Hansard, we'd find that half of the questions that were asked should be thrown out if we use those rules. I was simply trying to find out what responsibility there is with government to follow its own statutes when we force individuals and companies to follow the statutes of the day. It just seemed curious to me that we would go ahead and break those statutes. I will leave that with the minister and wait until he gets back to me.

[4:30]

K. Krueger: In my earlier questions I alluded to the difficulties I had finding my way through the estimates book because of the number of ministries involved in my area. I'd just like a little clarification. On page 256 of this book, the transfer from the Ministry of Government Services and Ministry Responsible for Sports of four employees of the gaming branch is recorded to the Attorney General and Ministry Responsible for Multiculturalism, Human Rights and Immigration; and also, under "Transfer from Other Appropriations -- Contingencies (All Ministries) and New Programs, Gaming Enforcement Agency," the sum of $551,000 with no employees attached to it. Then in the same area, a transfer to the Ministry of Government Services and Ministry Responsible for Sports from the Attorney General and Ministry Responsible for Multiculturalism, Human Rights and Immigration of the British Columbia Racing Commission -- a transfer of 18 employees. Then, turning to the table of contents, I don't find the Ministry of Government Services and Ministry Responsible for Sports there at all, but in a page stapled into the back of the book, I see a transfer from the Ministry of Labour of the British Columbia Racing Commission and the British Columbia Gaming Commission -- finances of $4,275,699 -- and an entry to the Ministry of Finance and Corporate Relations of those same amounts. I wonder if there isn't a danger with all of these transfers -- and I know the Attorney General mentioned earlier, with some of the areas I asked him about, that he'd only newly received and wasn't in a position to answer the questions on. . . . With the relatively small allocation for gaming audit and investigations of $1.25 million, I wonder if there isn't a danger inherent in all these transfers of employees and budgetary amounts in this key area, which really is of great concern to a lot of our citizens, of losing track and not keeping control of the situation.

Hon. U. Dosanjh: That might be the impression one gleans from all of the transfers back and forth, but those transfers simply represent the moving of the ministries, or various parts of the ministries, in the last six to eight months. The net result has been that the gaming audit and investigations branch has been much strengthened and has been brought over to the Attorney General's ministry essentially for the reasons that the hon. member is talking about: so that we can have more effective, independent, arm's-length enforcement from the Gaming Commission and from the Lottery Corporation.

K. Krueger: I would like to know, then, how many employees in total in the Attorney General's ministry will share the responsibilities for that?

Hon. U. Dosanjh: Thirteen.

Vote 16 approved.

Vote 17: ministry operations, $839,978,306 -- approved.

Vote 18: statutory services, $15,730,509 -- approved.

Vote 19: judiciary, $36,150,752 -- approved.

Hon. U. Dosanjh: Now we can have lunch. I move that the committee rise, report resolutions and ask leave to sit again.

Motion approved.

The committee rose at 4:36 p.m.

The committee met at 4:59 p.m.

[W. Hartley in the chair.]

On vote 55: minister's office, $373,020.

Hon. S. Hammell: It is a pleasure to present the estimates of the Ministry of Women's Equality. Before I start I want to introduce the staff members from my ministry who are here to help with this process. I have Val Mitchell, who is my acting deputy minister; David Gilbert, who is the acting assistant deputy minister, programs division; Mary Fedorchuk, who is the acting assistant deputy minister; and Lesley Ewing, who is the executive director of the management services division. I also want to acknowledge the dedicated work of other ministry employees, and the work of people in communities all over the province.

[5:00]

This budget for the Ministry of Women's Equality reflects the same theme as the government's budget overall -- a commitment to B.C. women and their families. This commitment is not new; it has been reflected in our actions since this government was originally elected in 1991 and in the directions we spoke of during the recent election campaign. Today this commitment to women and to families is what guides us in setting our priorities. That's why we continue to build on the programs that have a direct impact on women.

The Ministry of Women's Equality has a crucial role to play in supporting British Columbia women in their efforts to improve their lives. Our priorities are very basic. We are focused on stopping the violence against women and on building a child care system that provides accessible, quality child care that families can afford. Within government, we promote services, programs, policies and legislation that are fair to women. We advocate for equality, particularly in the areas of economic equality, social justice and skills development.

Our vision is of a society where women and men experience equality in all aspects of their lives. To help accomplish this, we work with women in British Columbia's communities, and our programs are inclusive of our province's diverse population.

Much has been accomplished over the past five years. This government has followed through on our commitment toward ending violence against women. Since 1991, we've supported a 32 percent increase in the number of transition houses, safe home programs and second-stage houses that are 

[ Page 564 ]

in operation all across the province. That includes 15 new transition houses, six new safe homes, 81 new counselling programs and 49 new children-who-witness-abuse programs, in over 100 B.C. communities.

As well, we have worked to break the cycle of violence, through community-based prevention programs. We have also worked hard, and invested dollars, to improve access to affordable quality child care. We have developed a comprehensive child care strategy, to stabilize and expand child care in B.C., and more than doubled our annual investment in child care from $61 million in 1991 to $158 million in 1995. This commitment is an important part of our plan to invest in long-term job creation and economic growth. I'm proud that the number of licensed child care spaces in British Columbia has grown by 55 percent since 1991, for a total of over 66,000 licensed spaces. And I'm proud that the day care subsidies are now helping 32,000 children receive the child care that they and their parents depend on.

We have also made progress in other areas. My ministry has acted as a central agency to make sure that the diverse needs of B.C. women are addressed, in all areas of government. An example of this is the work done last year on education and training opportunities for women -- for example, the Sandy Merriman house in Victoria, where women gained marketable skills in building an emergency shelter for women. Gender equality in the justice system, and issues and opportunities for women in land use decisions and forest sector strategies. . . .

My ministry has also advocated for fairness and equality in our communities. Grants to communities have played a major role in accomplishing this. For example, we invest $1.6 million annually for 38 women's centres across the province.

The ministry has also produced public education materials and organized activities around key events such as International Women's Day, Prevention of Violence Against Women Week and Child Care Month. We have embraced the diversity of B.C. women, including those of different ethnic backgrounds. For example, my ministry has produced the publication Keeping Women at Work Safe in five different languages and is looking into production of more multilanguage publications.

We have focused on working towards economic equality for women. This government has made progress towards economic equality over the past four years through initiatives such as a four-step increase to the minimum wage, up to $7 per hour. Seventy percent of minimum-wage earners are women. We have invested $86.6 million in pay equity adjustments for women in the public sector. B.C. 21 projects have created training, business and job opportunities for street women, transition house residents and aboriginal women. And there's a new monthly cheque of up to $103 per child which supports low- and middle-income working families.

In 1996-97, my ministry will build on this progress. Ninety-one percent of our budget will go directly to communities across the province in the form of grants and contributions.

Much of our work will continue to focus on helping to build a society that's free from violence against women. Violence is an everyday occurrence in too many women's lives, and we must find ways to stop the cycle. My ministry will devote more than $34 million this year to Stopping the Violence. The vast majority of this money, $33 million, goes directly to community organizations in the form of grants and contributions. We will maintain support for counselling for women who have experienced abuse, counselling for children who have witnessed abuse, sexual assault and women assault centres, treatment programs for assaultive men, aboriginal family violence prevention programs, transition house programs and community-based violence prevention projects.

This year, we plan to expand the existing network of 78 transition house programs that serve women and children leaving abusive relationships. Women's centres play a big role in many communities and are often the first place women go for help in times of crisis. Those non-profit societies respond to the needs of women in their communities by providing a wide range of services, from clothing exchanges to crisis counselling and support for groups to enter job programs. For 1996-97, we will maintain operating funding for these centres.

Most of my ministry's new funding for 1996-97 will go to low-income families in response to increased demand for day care subsidies. We are working to help parents find quality child care at a cost they can afford, so they can take advantage of training and jobs to support their families. For 1996-97, we are budgeting more than $21 million to cover a projected increase in the use of day care subsidies, and we will maintain funding for supported child care for children who need extra supports, wage supplements for child care workers, infant/toddler incentive grants, and facilities and equipment grants.

In 1996-97, my ministry will continue to play a key role as a central agency in government. We will be a strong voice within government, focusing attention on the impact on women of government services, programs and decisions. We will help all government ministries evaluate their programs from women's perspectives.

Much of my ministry's advocacy, inside and outside government, will continue to be focused on achieving economic equality for women. In 1996-97, we will work with the Ministry of Employment and Investment to implement a comprehensive women's employment strategy, support the growth of business ownership among women and help remove barriers to women's business development.

In 1996-97, the ministry will continue to maintain regional ministry offices throughout the province, to provide an important link between the head office in Victoria and women in communities across the province. Regional program coordinators will continue managing programs in the field, and will assist women and women-serving organizations in their work at the community level.

In conclusion, I am pleased to present the Ministry of Women's Equality budget estimates for 1996-97. Ninety-one percent of this budget goes directly to support B.C. families. With the exception of day care subsidy increases, we have essentially held the line on the operating budget for this year. We have done this while increasing the quality of service to the community. This is a budget that shows careful management of limited resources. It shows a strong commitment to women and to B.C. families. I want to acknowledge the important contribution of women and women's organizations across British Columbia who share that commitment.

This is my first budget as minister, and I'm dedicated to carrying forward our commitment to equality for women. This budget will help us move in that direction.

L. Stephens: It's a pleasure for me to be here today to conduct the estimates for Women's Equality. I want to thank the minister for the briefings that her staff have provided to mine, for the literature that she very kindly sent over and for 

[ Page 565 ]

the budget briefing. That has been very helpful. It's laid out in a way that I think is going to make it easy for all of us to get through these estimates in a timely way.

There were some efficiency reviews done in the ministry over the past year. I wonder if the minister would comment on those, and whether in fact those efficiency reviews of programs and practices and policies and procedures of the ministry are complete, and whether or not there are any contemplated for '96 and '97.

Hon. S. Hammell: First off, I'd just like to say that I think the question is important. And I think that ongoing evaluation and review of projects are critical so that we can assess the output, as well as what we anticipate the program to do. The ministry stresses the value of solid research and thorough analysis of the programs, and evaluation is a priority to ensure not only good fiscal management but to make sure our programs are effective. Evaluation projects are conducted by objective methods and consider both quantitative and qualitative data. Examples of current projects underway are: evaluation of the $32 million federal-provincial child care review project; analysis of evaluation approaches for transition house programs; and finalization of the Gender Lens document for program evaluation for use across government.

[5:15]

L. Stephens: I wonder if the minister could elaborate on each of those and perhaps talk a little about the federal-provincial child care initiatives. I know there has been some discussion with the provinces around a national child care strategy. My understanding is that the federal government proposed this initiative to the provinces, and some of them accepted and some of them didn't. So there is a bit of reluctance on the part of the federal people to proceed with them. I wonder if the minister could just apprise the committee of the status, if you will, of the federal-provincial child care initiatives.

Hon. S. Hammell: When I mentioned the $32 million. . . . That is a joint project between the federal government and the provincial government. Our contribution is $16 million and the federal contribution is $16 million, to make up the $32 million. My understanding is that we are the only province that has this relationship, because we were sharp off the mark and positioned well to take advantage when that first came out. The federal government did promise $630 million for child care, and again, we were quick to suggest that we'd be willing to participate in their program. We, of course, having a ministry that has this as a particular program item, were again well-positioned to take advantage of that. Unfortunately, the federal government has withdrawn that offer, and there is no program that I know of.

Coming back specifically to your. . . . Let's talk for just a minute about the strategic initiatives. The child care strategic initiative is a partnership with the federal government that commits its $32 million over four years, and the purpose is to develop, test and evaluate new methods of program delivery. In essence we could say, I think, with reasonable confidence, that our province, and the federal government as our partner, are doing some of the leading-edge work around child care because of this particular funding.

The initiative is comprised of three components which build on our child care community partnership plans, and incorporates the enhancements of the child care support programs. There are four one-stop access sites, which have been implemented in Terrace, Courtenay, Nelson and Vancouver. They provide a coordinated access to subsidy information, provide assistance with applications, and generally facilitate the accessing of programs. There is information there on child care choices and a referral program -- referral to services. There is also training resource and equipment lending at those one-stop access pilots.

Another component of the strategic initiatives is regional delivery models and community demonstration projects to test the integration and coordination of child care services in a given community, to enhance efficiencies. That goes back to the heart of your question. It also tests alternative funding models for child care, innovative approaches to improving quality in a variety of settings, and local solutions to particular child care problems in any given community.

The third component is developing an inclusive service framework to meet the needs of over 3,000 children with special needs who need additional support to participate in a full range of child care settings.

L. Stephens: If I have that correctly, the $16 million from the province and $16 million from the feds is a cost-share arrangement around the issues that you spoke of, and the $630 million was for a participation in a national child care program that would go from coast to coast, but that various provinces didn't buy into. So, for all intents and purposes, nothing is happening at the moment on that one. I would presume that that's correct.

The $16 million for the shared-cost programs that you were speaking of, over the four years. . . . Are the one-stop access sites freestanding or are they part of the provincial access centres or the government agents' offices? Where are these one-stop sites located around the province?

Hon. S. Hammell: All of them are with the community child care support program, and they are in Courtenay, Nelson, Terrace and Vancouver. As to the exact locations, we can get that for you.

L. Stephens: What I really want to know is whether they are a freestanding or separate offices or whether they share office space with other government agencies like the one-stop access centres the economic development people have set up and the government agent's offices. But if I understand correctly, these are offices that the regional program coordinators look after. Is that what the arrangement is, and the regional coordinators have care and control, for want of a better word, of these particular initiatives?

Hon. S. Hammell: They are not with government agents. They are often with the non-profit offices. In the centre is the child care support program worker, and often the FAW, who deals with the applications, and sometimes a provincial health officer. It's an access centre where people can go to get information -- multi-ministry.

L. Stephens: Could the minister describe in general terms how her ministry interacts with other ministries, and what the focus is for 1996-97 around this interministry action plan? Is there one ministry, or two, where there is a particular focus? I'm thinking of the Attorney General ministry, if I can give the minister a hint on the direction I'd like to go.

[ Page 566 ]

Hon. S. Hammell: The ministry does work as a central agency within government, so it also has a mandate to work within and influence government ministries. It has very close partnerships with the Attorney General, the Ministry of Social Services, the Ministry of Health, in particular, and the Ministry of Education. For example, the FAW from the Ministry of Social Services assists with the child care program. Originally, the child care program came over from the Social Services ministry to the Ministry of Women's Equality. We also work very closely with the Attorney General around violence against women in terms of policy and delivering the programs. Obviously, in Education and Health there is the education component to equality and opportunity; and the health component is particularly addressed towards women.

L. Stephens: We will talk about those as we move through.

I have a couple of questions in general about the ministry, and then I would like move into child care, which is where we kind of started. But we'll pick up on the provincial aspect of child care and leave the federal, which we've covered. I'd like to know the travel amounts that your ministry, your staff, incur and for what purpose. And also advertising: what amount of advertising does the ministry do, how much and for what purpose?

[5:30]

Hon. S. Hammell: Let me give you two specific numbers; then I'll go on to reasons. Public servant travel is $270,750, and the advertising and publications are $224,045. The average ministry travel per FTE for community liaison is $9,615 per FTE and for other travel is $700 per FTE.

The ministry has a regional presence, with 13 regional program coordinators serving over 100 communities. The regional program coordinators are our contact managers and the connection between the ministry and the communities. Monitoring, establishing contact with service providers and managing contracts requires travel. For example, the regional coordinator for North Coast-Nechako is responsible for a large geographical area which includes the Queen Charlotte Islands to Cassiar, through to Smithers. There are also federal-provincial meetings where it's critical that we influence federal policies that affect the lives of the women of B.C.

You also asked about publications. We use a variety of ways to get information to individual women. For example, in the past year we have produced and distributed a poster that promotes safety tips for women working alone, which is available through convenience stores, liquor stores, chambers of commerce and union offices, and is translated into Chinese, Punjabi, Spanish and Korean. There are brochures and a poster that promote the availability of transition houses for abused women and their children, which are available in doctors' offices and health centres, as well as many other locations. We were involved in a five-part cable TV series on child care, violence against women, women's health, job training and equality, for broadcast on cable stations throughout the province. There is also useful information about women and the ministry's programs and services on a web site on the Internet which women can access.

L. Stephens: Are the travel amounts of $9,615 per FTE. . .? I'm sure that all of the ministry staff doesn't spend $9,000 a year on travel. I would suspect that these individuals are the regional program coordinators. Who are they specifically? Is that who they are? The 13 regional program coordinators are the individuals who spend about $9,000 a year?

Hon. S. Hammell: Yes.

L. Stephens: I want to move on to child care, and we talked about that briefly. I have to say that the briefing presented was very good. It's going to be excellent as we try to move through this. There have been no changes to the child care support programs as far as funding is concerned. I wonder if the minister would like to comment on whether there have been any changes in programs or a reshifting of programs within that. This provides the resource, training and referral services. Have there been any changes there -- funding remaining the same? Have there been any changes, to another initiative?

Hon. S. Hammell: No.

L. Stephens: The infant/toddler incentive -- there has been nothing changed there as far as the funding is concerned, as well. This is operational funding to licensed groups and family child care facilities to address the need for spaces for children under three years of age. Do I take it to mean that the infant/toddler incentive program is not going to be expanding, that there aren't additional funds to provide spaces for children under three years of age?

Hon. S. Hammell: Infant care is the most expensive and the hardest to find. Providing grants to offset the cost of care for infants and toddlers is a place where we have to keep the cost down for parents, by giving the child care community the support they need to respond to that critical need for infant and toddler space. We are not increasing the amount this year, but our program is run on demand, and if there is demand in that area, then we will try to move flexible resources to it.

L. Stephens: Do you have statistics on how many infant and toddler spaces are provided in the province? Do you have ratios, for instance, for rural areas? What kind of opportunity and access to infant and toddler spaces is there for individuals living in rural areas?

Hon. S. Hammell: The number of spaces is 7,225, and as for the regional breakdown, we don't have that data, but we can and will get it for you.

L. Stephens: I guess I would ask whether or not these kinds of statistics are being kept by the ministry. Is the ministry trying to ascertain what kinds of needs there are in different regions of the province? Is that what you are going to make available for me?

Hon. S. Hammell: Yes.

L. Stephens: On the wage supplement initiative, what is the present rate of pay for child care workers and transition house workers who receive. . . . I guess it's the wage supplement; it's only the child care workers who receive that. Am I correct, or do transition house workers receive it as well?

Hon. S. Hammell: Both child care workers and transition house workers receive the wage supplement.

L. Stephens: Could the ministry provide me with the figures as to how much is spent on the wage supplement for transition house workers and child care workers -- both figures? Also, what is the hourly wage of child care workers and transition house workers?

[ Page 567 ]

Hon. S. Hammell: What we have is broken down in a number of areas. I can read those to you, or I can get you the information. For instance, under the child care support program, the 1994-95 adjustment was $485,496, and in '95-96 it was $214,667. I can read these through for you, or I can just get you this information.

L. Stephens: It would be helpful if I could have the numbers, including '96-97.

Hon. S. Hammell: The average wage for child care workers has gone from $10 an hour in '93-94 to $12.50 an hour in '95-96.

L. Stephens: I see that the '96-97 estimate for the wage supplement initiative has not been increased. I would presume that there won't be a wage supplement adjustment for '96-97. Would I be correct in assuming that?

Hon. S. Hammell: That's correct. There's no new money this year for additional wage supplements.

L. Stephens: I notice that this particular initiative is governed by PSEC low-wage guidelines. I wonder if the minister would make a copy of those guidelines available for me at some future date.

Interjection.

L. Stephens: Okay.

The child care strategic initiative is increased by $1.5 million. This one is the pilot for fundamental changes to the child care system in the areas of funding, management, regulation, accessibility and affordability. Could the minister talk a bit about this initiative? What is new, and where is that $1.5 million increase going to be spent?

Hon. S. Hammell: This is the area we just spoke about. We have the three components -- the one STOB and the other two programs -- where we were testing some delivery models. What has happened is that those are four-year programs, and as the programs expand, the funding expands with it. So you're taking up more of the $16 million that is available over that four-year period.

[5:45]

L. Stephens: This is part of the cost-shared initiative with the federal government that comes to $32 million. This particular initiative here is $1.5 million.

Could the minister give me a breakdown of the amount of money being spent for '96-97 out of that $32 million, in each of those initiatives she spoke about, that is going to make up the cost-shared arrangement for this '96-97 year?

Hon. S. Hammell: There is more than our ministry involved in the delivery of the system. For example, some of the money comes around supported child care. That involves the Ministry of Health as well, because it's basically for special needs children. So what was spent last year between ourselves, the Ministry of Health and the Ministry of Social Services is $3.7 million. We were able to claim back from the federal government $1,870,000.

As these programs expand and more services are brought on line to take advantage of the funding, then the program dollars will expand. I'm not trying to be vague. I can be very. . . .

L. Stephens: It sounds like it's difficult to break down the portion from this ministry, because it is interministry and it is cost-shared. Is that correct? Yes? Thank you.

I assume that this particular initiative will have ongoing monitoring and evaluation. If that is the case, could the minister indicate the time lines? Is it a six-month evaluation, or will it be a year? When could we expect that a report of this particular initiative and those others the minister spoke of would be available?

Hon. S. Hammell: The evaluation of this strategic initiative, child care renewal pilot projects, will study in depth the process involved in the planning, development, implementation, management and service delivery of the models of child care. In addition, the evaluation will determine if and how each child care pilot project impacts on improving the accessibility, affordability, quality, inclusiveness, cost-efficiency and responsiveness of the child care system.

What is happening is that the evaluation process is part and parcel of the project. It isn't as if you complete a project and then you evaluate it; part of the project is an evaluation process that is continuous over the life of the project. As projects are running, they are being evaluated and assessed on an ongoing basis. Then at the end of four years, you have information based on these pilots to provide you with the information on whether you continue or whether you need to reassess the spending of that type of money. It's not as if we can say that in six months, this one is over and that one begins. It's an ongoing process.

I move that the committee rise, report progress and ask leave to sit again.

Motion approved.

The committee rose at 5:51 p.m.

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