[ Page 4303 ]

The House met at 10:05 a.m.

Prayers.

Hon. D. Streifel: It's my pleasure today to introduce 29 grade 7 students from West Heights Elementary School in the wonderful city of Mission -- home of the West Coast Express, home of the new Heritage Park Centre -- where these young students will be able to carry on and complete the fullness of their education. They're here today with Ms. Lisa Barnard, their teacher. I bid the House make them all welcome -- and I'll be talking to them later.

Orders of the Day

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

ESTIMATES: MINISTRY OF EMPLOYMENT
AND INVESTMENT
(continued)

K. Krueger: It occurs to me that we were somewhat remiss yesterday in that the minister wasn't really given an opportunity to introduce the people who are with him. I wonder if he would like to introduce his advisers to the House.

Hon. D. Miller: To my right is Mr. Bruce McCulloch. Kathy Chopik is just arriving, and Ms. Lynne Kailan is to her left.

K. Krueger: I'm referring again to "Gaming Review," published by Mr. Peter Clark earlier this year. There is an appendix attached -- a study by KPMG. I wonder if the minister could tell the House the cost of the KPMG study.

Hon. D. Miller: Approximately $150,000.

K. Krueger: In addition to that, would the minister tell the House the cost of the overall study by Peter Clark to produce this report?

Hon. D. Miller: About $450,000, but that includes the $150,000 I just mentioned.

K. Krueger: The report was published January 28, 1997. It wasn't released until April 13, 1997. I wonder if the minister would be kind enough to tell us why it wasn't released right away.

Hon. D. Miller: We were studying the report.

K. Krueger: One of the issues that's discussed extensively in the report is VLTs and their prevalence across Canada. Of course, the decision was made to not allow VLTs in the province. Would the minister please explain to the House the difference between a VLT and the type of slot machines that are out to RFPs right now?

Hon. D. Miller: Well, I'm not. . . . There are probably people who can provide a more technical explanation, but fundamentally, people in the industry describe them as different, in that slot machines are coin in, coin out. There may be some technological variations on that these days. I don't know -- I've never played a slot machine.

As opposed to the VLTs, I think the member used the crack cocaine analogy. In other words, the way the VLTs operate -- the kind of speed and those kinds of things -- makes them. . . . There's more compulsion around them, I presume. Is there a distinction? Some people may not believe that there is a distinction, but there is. We've determined that there is and therefore have allowed only slot machines.

In addition to that -- and more importantly, almost -- is that the slot machines will only be available in a controlled environment, with a minimum age of 19. So I think there is an additional protection there.

K. Krueger: I also have never played a slot machine, so the minister and I are kind of talking theoretical understandings here, but I am told by people who study these things that VLTs are actually very similar to contemporary slot machines. There's an instant gratification aspect to both activities that tends to spur people on to continue to use them. I'm told that it's a 15-minute operation and a microchip to convert one of these slot machines to make it a VLT. Has the minister heard that, as well? Does he believe that?

Hon. D. Miller: Well, the machines will be owned by the B.C. Lottery Corporation, and they will not be converted.

[10:15]

Hon. D. Miller: Most important is the fact that there's not really a comparison, because we've rejected the Windsor model. We'll not be doing that. There will not be a major casino, so really the comparison is inappropriate.

Beyond that, my information from the Windsor people is that they have a great deal of confidence that even if there is development on the Detroit side, it won't have much of an impact at all, because of a few factors. One is the comparative advantage of the Canadian dollar. In other words, the people who come up from the United States to Windsor have an advantage in that their money goes further. Number two -- and, again, maybe we can be proud as Canadians; I mentioned this yesterday when I was talking about the attraction of Canadian cities -- is that one of the things the Americans like is the safety. They're clean; they're safe. Not to disparage Detroit at all, but in any reading I've done, there are probably 

[ Page 4304 ]

some areas in Detroit that aren't exactly friendly to tourists. So there are some distinct advantages that the Windsor people feel will allow them to be quite competitive.

Finally, in Canada there's no tax on those winnings. We've all heard the story of those people in Las Vegas, that when they strike it rich -- whether it's in a slot machine or a card game -- there's somebody from their Internal Revenue Service standing beside them saying: "Okay, what's your name? Give us our share."

So there are three really very strong advantages that Canada has relative to the U.S. that in the opinion of the Windsor people, as I understand it, leaves them feeling fairly secure about their future.

K. Krueger: In the table that Mr. Clark published on page 16 of his report, which laid out the anticipated number of jobs and the anticipated amount of revenue from the various expansion options, there is one column entitled "Source of Wager." In every category, Mr. Clark projected that the people who would use the gambling option would be 90 percent British Columbians, except for the very last category, which is casinos.

I appreciate what the minister said about the Windsor experience not being, in his view, that relevant after all, because of his decision to limit the size of casinos. Nevertheless, we are looking at a number of new casinos in British Columbia, apparently. They may not be the size of the Windsor ones, but they may be expected to replicate a lot of the experiences of larger casinos elsewhere, albeit to a smaller degree.

In any event, in this category, the large lower mainland casino. . . . I guess we cannot deal with that, in that the decision has been made not to have a lower mainland casino, as I understand it. But in the destination casino category, Mr. Clark's projection is that the source of wager for a Vancouver Island casino would be 52 percent B.C. residents; if there is one in Okanagan-Kamloops, 77 percent B.C. residents; and in the rest of the province, 50 percent B.C. residents.

I wonder if the minister or the ministry has done any assessment or prediction or had any evaluation done as to whether the other people. . . . This apparently is one of the attractions of destination casinos -- that other people will be drawn into the province to spend money at these facilities, in theory. Presumably a lot of those people would be, anyway, enjoying British Columbia for the things that have always drawn tourists to British Columbia: the scenery, the safety that the minister referred to, the lifestyle and just the joy of being in British Columbia. So have there been any evaluations of how much new tourism revenue is expected to be drawn by these casinos, rather than existing tourism revenue that would have been spent at resorts and ski hills and fishing camps and all the other things that people have historically done in B.C.?

[R. Kasper in the chair.]

Hon. D. Miller: No. It would be very difficult to try to quantify that. It does depend on the outcome of the RFP, the submissions that are obtained and the approvals that are subsequently given. We have no idea at this point where, for example, the destination resorts may be developed. So you can appreciate that presumably in some parts of our province, there would be a higher ability to attract people from outside than in other locations.

But it is interesting to note that in looking at all forms of gaming currently available in our province, well over 90 percent of the revenue -- probably 95 percent of the revenue -- comes from British Columbians, to the extent -- and I was trying to make that point yesterday -- that as a result of this modest expansion, we can see the development of new destination resorts with hotels, golf courses, aquatic centres and those kinds of things. Then we have the ability to attract visitors from outside of British Columbia, and to the extent that it is desirable to have that kind of revenue coming from outside our borders into our province to support the economy and to support new jobs, we think that's a reasonable thing to do.

K. Krueger: Is there a document that lays out the terms of reference that were given to the KPMG team, who produced appendix A to this report?

Hon. D. Miller: I assume so. I don't have a copy of it. I'll make inquiries to see if there is one and make sure we forward it to you.

K. Krueger: My thanks to the minister. If that could possibly be provided to my office today, I would appreciate it, because we may well find it productive to save us some time in these estimates.

Could the minister tell us the professional credentials of the KPMG team who produced this appendix?

Hon. D. Miller: No, again, I can't do that. I'm not familiar with the individuals or their credentials. One assumes, though, that an international firm like KPMG, with a very good reputation in the work that they do, has capable people working on these processes.

K. Krueger: Perhaps we can assume that. I was warned early on in my career that when I assumed things, I should break down the word. The point that my boss was making to me at the time was that "assumptions" can make an "ass" out of "you and me," and so it's always good to ask the questions.

I would appreciate it if the minister could ask for résumés of individuals who were on the KPMG team. I'm particularly interested in whether any of them have any background in crime or health matters, or any credentials to make the evaluations that obviously need to be made in considering a subject like gambling expansion in B.C. Would the minister be willing to ask his people if résumés are on file and give them to me -- or ask KPMG?

Hon. D. Miller: Certainly.

K. Krueger: Did the "Gaming Review" authors seek any advice from British Columbia's medical experts or university experts on problem and pathological gambling?

Hon. D. Miller: I understand that there were interviews with people in that field. Again, I don't have the particulars on that.

K. Krueger: I wonder if I could have the minister's commitment to find that out for me. I know there is a list of some of the people who were consulted. We do have a number of notable experts in British Columbia. I've met some of them, and they were delighted to meet someone who was interested in their expertise. I'm thinking of Greg Scriver, the expert at the University College of the Cariboo that I referred to yesterday, and also Dr. Tony Phillips and his team at the 

[ Page 4305 ]

University of British Columbia. Dr. Phillips is the head of the psychology department. And there are others. Granted, gambling addiction has not been researched anywhere near the extent that other addictions have in British Columbia, but these people are very interested. Mr. Scriver in particular has been focusing on that for some time. Could I have the minister's commitment to try and get a list for me of any such people that the KPMG team consulted?

Hon. D. Miller: Again, I did say that I don't have an exhaustive list of everybody who was talked to or that the team had some discussion with.

In regard to the report, there have been some expressions from people in the treatment of gaming addiction that they approve of an expanded policy on the basis that, for the first time in British Columbia, we'll be able to mount an actual treatment program, or programs, for people with those problems. I think the Victoria treatment and addiction foundation or centre -- whatever the correct terminology is -- has sent us a letter in that regard.

I guess the point there is that there certainly is a diversity of opinion even amongst academics. I'm a bit reluctant to consider or take the position that there is some final arbiter at the academic level, given what I said yesterday -- that I don't care which topic you want to talk about, you can always find an academic to take a position that's whatever you want. I've been involved in lots of issues beyond gaming where that is abundantly clear. So I don't think there's anything definitive, necessarily.

I think the responsibility in developing a report -- and I think that responsibility was carried out -- is to make sure that you discuss the relevant issues with a broad cross-section, that you obtain the variety of opinions that are extant and the advice from those in the business, and that you consult with the authorities. In other words, you're very comprehensive in terms of your overall look at the question. You assemble, if you like, as many of the facts as you can, knowing full well that there is also a variety of opinions about any particular subject. But your obligation is to try to assemble the facts and then, based on those facts and based on the broader issues of public consensus, make a policy decision -- which is what we've done. We recognize that on any public policy question, there will be people on both sides of an given issue, regardless of which issue you're talking about. That's simply human nature, I guess.

So we've done that. We did, I think, a very comprehensive report. I don't think there's anybody who has tried to dismiss the report. It's very thorough; it's very comprehensive. We've engaged a major Canadian firm, KPMG. We had an excellent team put together, and I think the report is very definitive. The report is not a recommendation; it simply sets out the facts. And we took those facts, we analyzed them, we listened to the public, and we made a decision to have a rather modest expansion of gaming in our province.

K. Krueger: The minister made the point that some people expressed relief that for the first time the government will be enabled to have a comprehensive program in British Columbia. This government has actually expressed the need for a comprehensive program many times in the past. I'm looking at a document dated October 1994, and it's entitled "Report of the Gaming Policy Review." Of course, that was an NDP government. I see the minister looking at the Minister of Human Resources, who worked very hard, as I understand it, in consulting the public back in those years, along with another NDP MLA, and produced recommendations which were apparently heavily influential in the government's decision not to proceed with a major casino in B.C. in 1994, and in 1995 not to proceed with VLTs.

One of the things that is said in this report, which is over the signature of the Hon. Robin Blencoe, Minister of Government Services at the time, is this:

"A comprehensive program to assist problem gamblers is overdue" -- it was overdue in October 1994 by this government's own documentation -- "and will be put in place as soon as possible. As noted above, it will involve a full range of measures to address the problem, from prevention to treatment. This will include public education and the development of materials which can be used in schools. A toll-free hotline will be established, and problem gamblers will have access to the services of trained counsellors. Based on information from other jurisdictions, the program is expected to cost approximately $1.6 million annually."

[G. Brewin in the chair.]

So given that information, then, that the cost of the program was expected at the time to be $1.6 million annually and that there's been inflation since, of course. . . . Not only that, but the minister has announced this gambling expansion, with the anticipation of an 1,800 percent increase in gambling revenues from this expansion. Various figures have been bandied about as to the amount that the minister has dedicated to programs for assessment and treatment of problem and pathological gamblers. Could he give us the up-to-the-minute advice as to the amount he has set aside for this issue in British Columbia over the coming year?

[10:30]

K. Krueger: That's my understanding, too, and I appreciate that the responsibility has been delegated to or accepted by, I think, the Ministry for Children and Families. I'm having a great deal of trouble getting a briefing from them, and I normally don't have any trouble getting cooperation from that ministry. I read into this that, as I suspected, they're finding themselves awfully busy with their job of trying to protect the lives of children in their care in British Columbia. Perhaps they haven't been able to produce enough in this area to want to have a briefing meeting with the opposition and give us a progress report. I'm really concerned about that on a number of levels, one being that it's an imposition on their time and resources that they ill afford, according to what their employees are saying publicly -- the demonstrations at MLAs' doorsteps and so on. Also, this is a tremendously important issue in British Columbia; it was before the gambling expansion, and it is more so now.

I ask the minister, given the fact that in 1994 his government committed $1.6 million a year, if it isn't possible that he could revisit that question of how much is going to be committed to these programs immediately and consider a much 

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larger amount, given the fact that he expects $270 million a year in revenue to flow from the expansion, in addition to the $300 million or so a year that this government already enjoys from gaming revenue.

Hon. D. Miller: I'm not familiar with any previous commitments, nor do I think there was a previous commitment. There may have been an identification of a number, but I don't know that there ever was a commitment by a previous administration.

Secondly, these are budgetary items, and they do fall within the purview of the Ministry for Children and Families. My understanding is that the program that they're going to propose is adequate on a comparative basis. We'll have to wait and see how that stacks up against what other jurisdictions are doing -- jurisdictions that have significantly more gaming than we do.

With all due respect, any budgetary decisions or discussions relative to another ministry have to be pursued. . . . I'm open to the general topic of talking about it; I don't want to close the door in terms of discussion. But with respect to a discrete budget item that rests with another minister, I hope the member appreciates that it's not within my purview to discuss those kinds of details. We're not doing it within my ministry, and there is another venue to do that.

K. Krueger: I appreciate the complexities of how that sort of issue has to be resolved. When we did estimates last summer, gaming was entirely under the authority of the Minister of Finance, but it hadn't been for very long. He had to more or less concede, in answering a number of questions, that he wasn't that familiar with the issue. But he did make a commitment that he would work toward a percentage of gaming revenues being channelled off to deal with the consequences of pathological and problem gambling. And the Minister of Health made a commitment that she would work to ensure that programs were brought on for assessment and treatment of problem and pathological gamblers. Then right after the summer, of course, the entire matter was transferred to this minister, and cabinet made the decision that the Ministry for Children and Families will handle this aspect.

I don't want to miss talking to the right minister at any stage of this process, to ensure that things really do happen. There are people who say that at least 10 percent of gambling revenues in any jurisdiction should be channelled to this purpose. If we even had 1 percent, we would have had $3 million a year over the last number of years, or thereabouts, to work on this problem. But we've had nothing until this year. Presently, as I said, we don't seem to have anything, although I have a lot of faith in the people who have been charged with bringing a program on and am confident that something will emerge soon.

One of the things that troubles me about the KPMG report. . . . The minister said some complimentary things about it, but I'm not that impressed with it, and I'll show you why as we go along. One of the things that troubles me that isn't their fault -- if it's a fault -- is that they say their study's scope -- this is appendix A, page 5 and over to page 6 -- did not include a policy recommendation as to whether gaming should or should not be expanded. So that wasn't in their mandate. It did not include recommendations for implementation, particularly the identification of governance and regulatory responsibilities, and it did not include market feasibility analyses of the prototype gaming expansion scenarios. Could the minister tell me why the ministry that was willing to spend $150,000 on getting the advice of these experts wasn't interested in hearing their recommendations either on whether gambling should be expanded or on the implementation?

Hon. D. Miller: We felt that that was the responsibility of government.

K. Krueger: I agree it's the responsibility of government. I know the opposition feels that there's a huge responsibility on government in this whole area -- and some irresponsibility on the part of the government in proceeding. But if the government is going to spend this kind of money on a study -- half a million bucks on the whole Peter Clark initiative and $150,000 to these people alone. . . . Incidentally, KPMG attaches another appendix, which is a report somebody else already paid them for with very similar considerations. We hope that we didn't just get a dusted-off or warmed-over version.

Again, I'll point out some things that I'm concerned about as we go along. But if we're going to spend that kind of money, then why wouldn't we also ask for their opinion? They're the ones who talked to everybody concerned, and they're the ones who got to walk away with the money in their jeans. I would like to have known what their recommendation was. The only clear reason I can see for not wanting it is a concern that the government might disagree with it and then have to face that sort of as an embarrassment.

The KPMG report, on page 22 of appendix A, makes the point that casinos in Montreal, Halifax and Winnipeg have not drawn out-of-province visitors, and it does make it clear that Windsor is unique because of its proximity to Detroit. So why then would KPMG have appended the Windsor casino experience to Mr. Clark's report, as well as the report that they had commissioned? Accepting what the minister already said -- that we didn't accept a casino the size of the Windsor casino -- I don't understand, in the whole selling process of this gambling expansion to the public and media, why this government would have drawn on the perceived success of the Windsor experience when the report makes it clear that the Windsor experience is irrelevant to anything that might happen in British Columbia.

Hon. D. Miller: I just assumed that an analysis done by KPMG of a major casino in Canada a year after it was started might be useful information for those who had an interest in the subject of expanded gaming. I think that's reasonable. It makes a lot of sense to me -- common sense.

Look, I understand that there are is a variety of opinions, and I kind of jokingly said yesterday that I understand the official position of the opposition. But I've also heard some unofficial positions, with all due respect. As we move forward, members are going to have to make some individual decisions, I presume. The member for Peace River South referred to a referendum that is taking place in Dawson Creek. It's clear that in other parts of the province there have been a variety of expressions of interest -- and in some cases expressions of complete lack of interest. I would assume that as we do move forward to the stage where we are looking at actual proposals for destination resorts for some locations around the province, which must have the blessing of the local government, no doubt MLAs who represent those constituencies will be asked their opinions of certain proposals. And all of them, I guess, will have to make their own judgment about the relative merits of any proposal within their constituency. Not that they have to give their blessing or not give their blessing, 

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but it will be interesting in the future to see, in the face of those kinds of proposals that come forward, where each MLA may be in terms of those issues. I guess they have, really, three choices. You know the old multiple-choice question? A, B and C: A, you could be supportive; B, you could be in opposition to the proposal; and C, you could run for cover. So I guess we'll have to wait and see what develops in that regard.

K. Krueger: The minister is moving into an area that I'm actually going to canvass a little bit later with regard to the problems that this manner of implementing a change, especially one as important as gambling expansion, creates in a jurisdiction, as has been created in British Columbia. I can and do assure him that the position of the official opposition -- and it's not just an official position; it's the position of the official opposition -- is and will be that we are opposed to gambling expansion, and that will be our position going into the next election. We intend to do what we can between now and then to ensure that the public's eyes are opened to the tremendous social costs and the things that they have to anticipate in the local areas where this expansion question is being reviewed.

The minister has touched on the potential for division between British Columbians over the issue of gambling expansion, and that is a destructive force in British Columbia right now. Municipalities are having to look at one another and wonder whether the neighbouring municipality is going to go ahead with something when they aren't and thereby draw business away from their municipality and all the established economic drivers in the municipality. Municipalities are eyeing first nations people and aboriginal reserves and wondering the same thing, and no doubt aboriginal people are looking at municipalities and wondering that.

[10:45]

Before I do, I note that the KPMG group spent much of its effort on the question of full-scale casinos and VLT options. This government announced in late '94 that it would not have a Las Vegas-style or full-scale casino. The Premier, during the election campaign of May '96, said that this government would not have that. And this government announced in early 1995 that it would not have VLTs. The minister repeatedly said yesterday, in his responses in these estimates, that it was very, very clear to this government that the public is opposed to those ventures in British Columbia. That's what the press releases in '94 and '95 and the Premier's comments in '96 all said, too.

As far as I know -- and this would be a two-part question, I guess -- the government hasn't done any other public opinion surveys in between those that verified that the public are still as dramatically opposed to VLTs and full-scale casinos as they were in '94 and '95. Perhaps the minister would confirm whether there have been any polls or surveys done on that question. But given the fact that all those statements and commitments have been made by this government, why in the world was any of KPMG's time -- and the money spent on them as a resource -- wasted in evaluating full-scale casinos and VLT options across the country if British Columbia had no intention of proceeding in those directions?

B. Penner: I seek leave to make an introduction.

Leave granted.

B. Penner: It's my pleasure this morning to introduce a school group from Chilliwack Christian school that is visiting the Legislature today. Seated in the gallery just behind me are 24 grade 7 students, four parents and two teachers from Chilliwack Christian school, including Ms. Brenda Bakker. The class is learning a little bit about politics and government today, as well as B.C. history. After their visit to the Legislature, I understand they're going to go to the B.C. Museum. Would the House please make them welcome.

Hon. D. Miller: I just want to say very briefly that in examining options, clearly the member would support a broad examination of all of the potential options with respect to gaming. What's really important is not what you've looked at; it's what you've ultimately decided. In the case of this government, we've decided to not have a major Las Vegas-style or Monaco-style or Windsor-style casino. We've decided not to allow VLTs in the province, so this is entirely consistent with previous discussions around the topic.

K. Krueger: The ultimate decision is consistent, but that decision has been announced over and over again. The minister didn't answer the first part of my question, which was whether there had been any public opinion polls in the last two years that had caused the government to think that perhaps public opinion might have changed or grown stronger against those options. I see the minister shaking his head, and I take it the answer is no, but perhaps he would confirm that.

My point was: why spend the money evaluating those options? In fact, there's a big concentration on those options in the KPMG study, when the commitment had already been made to the public that their wishes would be complied with in this area. It seems to me that it's a waste of public funds to have done this. Also, there's a certain amount of deception in the KPMG report when it does focus on the Windsor experience, and it spends a lot of time dealing with VLTs and large-scale casinos. None of it is really relevant to what the ministry was apparently considering, which was what it has done in swinging into all these other gambling expansion options.

Hon. D. Miller: I'm not aware of any other polling. There is none done by government. There may be some done by others that I'm not aware of. But surely the member does appreciate that it's very difficult. We did what I think is a very thorough piece of work in examining options. I did say that we have an obligation, when dealing with these questions, to gather all of the facts. That's how decisions are made, or that's how they ought to be made. You gather all of the facts that are available, in an objective way, and then you look at those and you study them. You consider the broader issues of the public's views on these questions, and you make a decision. That's good public policy-making, and we've done that.

With all due respect, the member characterizes the report that we did -- an honest look at gathering facts to inform our 

[ Page 4308 ]

decision-making -- as deceptive. And the member characterizes the poll that we released -- which shows that British Columbians support what we're doing -- as dishonest. I hope the member appreciates that if you want these kinds of processes, if you want an objective process to gather information, which this is. . . . I don't think there's anything in here in terms of information-gathering that could be characterized as misleading. The fact that we looked at all facets of gaming is not in the least misleading. It simply means that we looked at all the issues, and we put them in a book and made it public. The fact that there's a poll done by Environics, a recognized polling firm, that supports the modest expansion of gaming that we've introduced. . . . It's easy, I suppose, if you don't like the results of something. . . . There's always the tendency to try to attack either methodology or the firm itself. And I guess that's fair enough in terms of debate, but surely the member would give some credence to these outside companies that conducted this kind of research and produced the results, even if he doesn't particularly like what the results are.

K. Krueger: Whether or not a study or poll is objective or whether it's thorough or whether it's a valid public process hinges on the assignment that the polling or evaluation company is given by its customer -- what its instructions are: things like whether or not its recommendation is going to be welcome at the end; things like whether or not it gets a clear understanding from the customer of what the desired outcome is. Those are questions that obviously come to mind, and that's obviously why I would like to see. . . . I appreciate that the minister has committed to give me the terms of reference that KPMG was provided.

As to whether or not. . . . Before I move to that, the Environics poll, as I touched on yesterday, was no normal poll in the way that British Columbians are accustomed to being polled. It was a poll that asked an initial question and then a series of leading questions, and clearly moved people toward a result that the customer -- the NDP government, in this case -- wanted. And I think that the sensitivities of that were well understood by this government, as illustrated by the fact that it got the results in early January and didn't release the results until May.

How thorough could KPMG have been? In the United States, President Clinton has signed a bill authorizing a two-year commission to assess the impact of gambling expansion in the USA, and the commission has a multimillion-dollar budget just to examine that. Can the minister explain how it could ever have been possible to conduct a comprehensive or thorough study in six weeks on a question this important?

Hon. D. Miller: It wasn't a comprehensive study of the nature that. . . . I'm not familiar with the one that you refer to with respect to President Clinton. . . . It was a fact-gathering exercise. Again, with all due respect, I would suggest that companies like KPMG would not last very long in business if the perception was that they could simply be bought to produce whatever it was that the customer wanted. They simply wouldn't have the kind of national stature that they have as a major consulting firm, both in Canada and internationally.

That holds true as well for polling firms. If they're not seen to have integrity in the conduct of their business and if the results of their work is not seen to have integrity, then I suspect they wouldn't be in business for very long. My understanding of polling firms that tend to become simply agents of whoever it is they're working for is that they don't last; they're not around in Canada.

Looking at the appendix of the list of interviewees -- just to illustrate my point -- that KPMG talked to in their year-end analysis of the Windsor operation. . . . They talked to the mayor and council; it seems to me that the mayor and council might be a reasonably good source of opinion. They talked to the city staff. They talked to the operator. They talked to suppliers. They talked to the industry associations: the Canadian Automobile Workers, the City Centre Business Association, the Windsor Chamber of Commerce, the Ontario Restaurant Association; the hotel association; downtown and local businesses: the Windsor City Market Association, Winograd's Fashions -- an individual store -- Maggies Dress and Sports-Wear Shop, McCance English Shop, Shanfields-Myers Jewellery and China Shop -- I've never been to Windsor, but it sounds like you can. . . -- the Cambridge Shopping Centres, the restaurant Ye Olde Steak House, McDonald's, Plunketts Bistro and Bar, Sir Cedrics Fish and Chips and Tim Hortons -- the donut and coffee crowd.

They talked to the Art Gallery of Windsor, Francois Baby House -- it's a museum, I think -- the Royal Bank and CIBC. They talked to the people who own the parking lots; the car rentals; the taxis; the regulatory agencies: the Ontario Gaming Control Commission -- Insp. Mike Sharland, Sgt. John White, and Constables Brian Dunham, Hugh Croney, Rob Shaw and Marilyn Stewart; the Windsor Essex County Convention and Visitors Bureau -- all solid citizens; the community support agencies, such as the Canadian Foundation on Compulsive Gambling, the Family Services Bureau, the Addiction Research Foundation, All Saints Church, St. Alphonsus's Church and Credit Counselling; community sport agencies; public safety and security agencies; other gaming operators; provincial agencies; federal agencies; educational institutes. In fact, if I'm not mistaken, the University of Windsor did an academic, objective study, and it came out in support of the operation.

So with all due respect, it's not my job to defend KPMG. They're quite capable of doing it for themselves. Surely the member would agree that prior to characterizing any report in a somewhat offhand manner as being misleading or deceptive or dishonest, one really has to have something to support the contention. I think the report speaks for itself. I think the general public probably has a reasonable degree of confidence. The business community -- and I know; I deal with the business community all the time -- utilizes KPMG and probably has a fair amount of confidence. So I think the work was good; I think the work was thorough. It didn't provide advice to government; it provided facts to government. And government, as is their responsibility, looked at the facts, consulted with the public, listened carefully and, as a result of that, made a decision to allow a modest expansion of gaming in our province.

[11:00]

Hon. D. Miller: Yes, I've read the report, but of necessity I have not studied it in every detail or every page. Don't ask me to quote from individual pages. In addition to reading, there have obviously been discussions with my officials in terms of their analysis. So I think it's been given a pretty comprehensive look, and that formed our decision.

[ Page 4309 ]

Hon. member, I now have the terms of reference and the personnel involved in the KPMG part of the report. I'll pass that page over for the member, and if he has any particular questions, I will try to answer them.

K. Krueger: I'll certainly read that, and I appreciate the promptness of the delivery of that information. I'll probably canvass it after lunch, if issues arise out of it.

What really baffled me about the minister reading off the list of who KPMG consulted in Windsor is that that isn't the report that the B.C. government paid for. What I'm really interested in is what consultation was done in British Columbia that's relevant to British Columbia. The minister and I both just said that we agree, for different reasons, that the Windsor experience is irrelevant to gambling expansion in British Columbia. The minister agreed it was irrelevant because in the end, he said the government decided not to do that style of casino in British Columbia. And I said it was irrelevant because the Windsor experience was nothing like any experience in British Columbia ever will be or could be, because we don't have a captive market, as Windsor did with the Detroit market.

So I was astonished to have the minister get up and spend that kind of time reviewing what KPMG did in Windsor, because it's not relevant. When I read the KPMG report, whatever their stature as an organization, I thought the authors could well be Pollyanna and the three little monkeys my grandmother used to have on her shelf that covered their eyes, mouth and ears, and said: "See no evil, hear no evil, speak no evil." To me, it is clearly a report that was designed to put the best possible face on whatever the government decided to do.

In fairness to the minister, I think he was quite upfront about the Peter Clark exercise in the first place -- that he never intended it to be a public consultation; he intended it to be a review of options. I remember him being very frank about that in the media. So when I first read the KPMG study and saw that it purported to evaluate social costs and those sorts of questions, I was surprised because I had understood that wasn't going to be in Peter Clark's mandate. But when I read the report I was no longer surprised, because it looked to me as though this organization had clearly been commissioned to come up with a result that the customer desired and had made clear to them in advance.

As for the kinds of casinos being contemplated in British Columbia, as I understand it, some will be allowed to serve alcohol and some will not. Would the minister tell us what the intent there is?

Hon. D. Miller: I think there are really only two potential areas where alcohol may be served. The decision on awarding liquor licences does not rest with this ministry, nor will it. We'll have nothing to say about anyone's application for a liquor licence, but the two areas where that could take place are at the destination resorts and presumably at the racetracks, where I do believe. . . . I haven't been to the Vancouver racetrack, Hastings Park, for years, but I do recollect that there is liquor available at the racetrack.

K. Krueger: I take it, then, that existing requirements for community approvals for liquor licences will be respected, and that the minister is saying that Employment and Investment won't be making the decisions about whether or not alcohol is served in casinos.

Hon. D. Miller: Well, put it this way: we've not prohibited. . . . Again, the jurisdiction is not with this ministry. We have not ruled out or prohibited alcohol being available at the destination. Given that we are prepared to allow the installation of slot machines at racetracks, provided they are in secure areas where no one under 19 can have access, presumably there would be some interaction there, because liquor is already available at the racetrack where people currently gamble on horses. So there is currently the ability to partake in gaming and to have access to alcoholic beverages at the racetrack.

K. Krueger: In the casinos in Nevada, as I understand it, customers are plied with free food and drink and everything that could possibly make them comfortable to remain a customer all day long, if they will, or as long as they might possibly stay. I wonder if the minister or his colleagues has given any consideration to a prohibition on free alcohol being provided in any of these establishments to encourage people to continue to gamble. Obviously there's a relaxation of people's judgment and a profound change in their ability to judge how they ought to spend their money. There's also the overarching concern of cross-addiction situations, with alcohol and drug addictions readily lending themselves to the development of gambling addiction in a problem or pathological gambler. To boil it down, my question is: will this minister commit that British Columbia will not allow free drinks to be given to gambling customers in B.C.?

Hon. D. Miller: To the best of my knowledge, that is under a different ministry. But I don't think there's any situation where that is allowed currently. One can check with the Attorney General, but I'm certain that's the case in terms of current liquor policy.

K. Krueger: The difficulty with that answer is that as I've wended my tortuous way through these estimates, as far as we've gotten with them, one minister after another has said to me: "Sorry, anything to do with gambling is the responsibility of the Minister of Employment and Investment." They seem to have been under some fairly strict instructions about that, and I've had very limited success in getting answers out of any other minister -- some more than others. I'd really appreciate it if the minister would tell me his intent, because I think everyone else is looking to him for leadership on this issue. In fact, he seems to have been substantially ahead of the herd on a number of the decisions that have been made.

Hon. D. Miller: I certainly will stand here and make an offer to the member. If there's some difficulty accessing information from any ministry relative to this topic, whether it's on the liquor policy or whatever, I'll certainly endeavour to get the correct answers to questions that he does have and forward them to him. I have no hesitation at all in making that offer. I just didn't want to get into a discussion of the policy of the liquor administration branch, because it's not something that I'm that familiar with. It does rest with another ministry. If there are specific questions relative to that and I can assist in finding answers, then I'll be more than happy to try to get them for the member.

I hesitate to stand here -- I hope none of my friends are watching -- and say that I'm opposed to free drinks. When I go home, I might get some trouble on that score -- not to be overly humorous. I appreciate the thrust of the member's question. He simply doesn't want a situation where people can be plied with free drinks so that some casino can take advantage of that, and I agree with the member's position on that. As to the precise details or the rules governing those kinds of questions, my understanding -- and I hope the 

[ Page 4310 ]

member will appreciate that I'm simply offering an opinion as to my understanding -- is that I don't think that's currently allowed in any drinking establishment. Under the current rules, I don't believe that drinking establishments can do that. That's not to say that in the local bar that people in a social milieu happen to frequent, the owner might not occasionally buy a drink for a regular customer. Those kinds of things, quite frankly, do happen.

My own personal view is that the state ought not to try to regulate every single aspect of human behaviour, but should have policies to prevent abuses. I'm sure that that is the policy. I'll see if I can confirm that. For any other questions the member has relative to those kinds of things, I'll be happy to try to get the answers. I'm simply saying that in terms of my officials, it's not our ministry, and I can't give precise detailed answers to some of those questions.

K. Krueger: I appreciate that explanation and that commitment, because I know there are a lot of complex questions that flow from a decision like gambling expansion or probably just about any decision he has to make. We'll continue to find a way to the answer on some of those things. I appreciate that those concerns are shared by the minister and the government -- I believe that.

As to not believing that the government should regulate absolutely every activity of the people, I say amen -- absolutely not! But gambling, of course, is an illegal activity in Canada, except for what the provinces authorize because of the empowerment they received from the federal government some years ago. As the provinces widen the gates on gambling, all of these other questions naturally come up. So much seems to be in flux that it's important that we address these questions and make sure that decisions aren't taken that perhaps no one in this House would agree with if they understood the ramifications of them -- which, incidentally, I think is what's happened with the gambling expansion decision in general.

Let's move on for a moment to the question of how much money people will be able to spend in casinos in British Columbia. I talked the other day about the daughter of a gambling addict who told me how her father was capable of losing the house in a single night of gambling and had done it when she was a girl. Has the province considered the question of whether it ought to prohibit casinos from installing automatic teller machines or Interact, or from cashing cheques or allowing people to get draws on their credit cards? Have those types of questions been explored?

Hon. D. Miller: In terms of discussing that question, I'd like to take this opportunity -- it has never been announced in a formal way -- to advise the member and the House that the lottery advisory committee has made the decision. We've not conveyed it publicly, but I'm doing it now. We will not allow ATM machines in those casinos.

K. Krueger: Well, it's nice to draw out a brand-new announcement during the estimates debate. I'm pleased with that; I think it's a good decision.

What about the other questions with regard to the use of credit cards within the casino to get a cash draw or the ability to cash cheques in the casino or the ability of a casino to grant credit to its customers?

[11:15]

Interjection.

Hon. D. Miller: Yeah, "In God we trust; all others pay cash." No, no cheques. It's credit, so that won't be allowed.

K. Krueger: I don't know if we should bring God into this, because I think he's been left out so far. Some of the strongest opponents to the gambling expansion initiative, of course, are the churches in British Columbia. People sometimes say the guardian angel gets out when the car goes over 90 kilometres an hour. If jurisdictions decide to press on with a decision like this in the face of all the evidence that there are strong social considerations and so on, the last thing I think a casino should do is trust in God for its profits. I know the minister was joking, but I thought it was interesting that that came up as it did.

Has the minister developed a mechanism to interface with the other ministries that will be absorbing cost increases as a result of casino expansion?

Hon. D. Miller: First of all, we don't accept the general statement. I should say, Madam Chair, that there is a separation of church and state, and this discussion is non-secular.

No, we don't accept that that is. . . . But we have discussed issues such as policing. That is a discussion that will take place in terms of the community context. The member is aware that we are developing, as well, programs to deal with gaming problems.

K. Krueger: The reason I asked that question is that unless for some unforeseeable reason British Columbia has a very different experience than other jurisdictions all around North America. . . . I know that the minister may in his initial response say that KPMG is assuring him that the experience hasn't been all that negative in Canada so far. I beg to differ with him.

But in any event, there are many jurisdictions in North America that pressed on into gambling expansion far ahead of anyone in Canada, and, of course, British Columbia has kind of hung on until the very end, compared to the other provinces of Canada.

I think intelligent people learn from the mistakes of others rather than making the same mistakes themselves. Even if they choose to make the same mistakes, intelligent people at least try to be prepared for the consequences that will flow. I think that the people I'm talking with over there are certainly intelligent people, so even if, as I think the minister was indicating, he isn't convinced that there are going to be any social costs in British Columbia as a result of this gambling expansion. . . .

Even if that's the case, judging by all the material that's readily available to him -- because even an impoverished opposition member with very scanty resources has been able to get more material than he knows what to do with on this subject. . . . It is unbiased material, because it comes to me from people who have nothing to gain by being opposed to gambling, whereas I know that the minister would have received whatever material could be pumped to him by the gambling industry, which has everything to gain by being allowed to operate in British Columbia.

If that material is considered, then surely there's a reasonable hypothesis, at least, that British Columbia is going to face social costs, and those are going to have to be dealt with by the various ministries. I'd take more comfort, and I think British 

[ Page 4311 ]

Columbians would, in the knowledge that there was some really active mechanism in place to interface between ministries so that the minister could have the earliest possible warning and signal from the affected ministries if the consequences that are predicted start to flow.

For example, I predict, and I think just about anyone who doesn't have a profit motive for gambling expansion would predict, that the Ministry of Human Resources will experience an increased draw on its budget as people become impoverished by the effects of gambling expansion. I predict that the Attorney General ministry will experience vastly increased costs because there will be more crime as people attempt to come up with funds to fuel their gambling addiction. We'll go into gambling addiction a lot more in a little while.

I predict that the Women's Equality ministry will experience drastic effects as a result of gambling expansion, and there will be deep concerns and regrets in that ministry that the threat of those events wasn't examined and that the Minister of Employment and Investment wasn't counselled by the Minister of Women's Equality, in advance of this decision, not to do it. I predict that there will be a major draw on the health care system as a result of gambling expansion.

These aren't things that I make up. I didn't know anything about these issues until I was assigned as gaming critic, but all the information is there to be seen. And that goes on and on. The Minister of Small Business, Tourism and Culture told me yesterday that she hadn't done any projections or studies anticipating what the effect was going to be on small business and on tourism in British Columbia. It may well be a very negative effect, and there are things in the KPMG report that actually predict that.

If the Health ministry and a couple of others experience even a 1 percent increase in costs as a result of gambling expansion, it will wipe out the projected revenue to government from this gambling expansion. Right off the bat, it'll wipe it out -- let alone the long-term effects. Everyone tells me and all the experts seem to say that the effects are cumulative, that gambling problems -- pathological and problem gambling -- tend to become worse over time, and worse with more venues.

I take it from the minister's answer, then -- and maybe he would just confirm this -- that there is no active interface with those other ministries presently. Given that, I would really appreciate a commitment from the minister that he will create one to make sure that he hears the warning bells about the effects of gambling expansion as soon as any ministry sounds them.

Hon. D. Miller: Certainly the suggestion from the member in terms of the interministry relationship is important. We will ensure that that takes place. In fact, I think that is certainly going to be part of how we operate. I simply meant to say in my last answer that as proposals come in and are evaluated and discussions take place, presumably with municipalities and with band councils, those are the kinds of issues that become part of any discussion. To the extent that enhanced revenue provides opportunities for enhanced police resources and those kinds of things -- if required as part of that evaluation -- we have the ability to respond.

I got onto this a little bit yesterday, and I just want to repeat it very briefly. I was struck by a news item -- I don't have it in front of me -- I believe, in yesterday's Times Colonist. I haven't seen the report -- Dr. John Millar, the chief medical health officer, issued it -- which is really a bit of a statistical evaluation of the relative health of the population. Again, there are some benchmarks: longevity -- I notice that women still continue to live longer than men. I'll leave aside any speculation why that takes place. But I was struck, as I am always, by the fundamental difference between society in general and those who, in my view, have become economically alienated -- the aboriginal people in this province. Look at the statistics for longevity for aboriginal people in this province relative to the rest of the population. There is a startling and dramatic difference. Why?

Economic alienation. It is far more devastating in its social consequences than any of the issues we are talking about. To the extent that there are opportunities for jobs, reasonably paying jobs, surely the member ought to agree that the offsets in terms of those opportunities can be significant and that they do more to improve the general health of the population than any other single thing.

I try to look at issues in some broader context, not in isolation. I recognize that with a lot of activities, there can be negative consequences, but one surely has to put that in context. People have accidents when they go skiing. No doubt that becomes a drain on our health care system. People who jog have a terrible history of having to go in and have their knees operated on. That's an impact on our health care system. Smoking, alcohol -- no one tries to deny that these don't have an impact. But it seems to me that the contextual positioning of those is quite important. Really, that's all I've tried to argue, which I think is a reasonable way to look at these kinds of questions.

K. Krueger: The issue of the effect of gambling expansion on aboriginal communities is certainly one I want to canvass, and I will a little bit down the road.

I appreciate the evidence and sincerity of the minister when he talks about what he obviously sees as an economic boon to aboriginal communities that he believes will flow from gambling expansion. I believe it may look that way in the short term, but the experience of aboriginal communities elsewhere -- and we don't have to look very far; look at Alberta, just over our border to the east -- has been grim. These jobs -- are they real jobs, when you're dealing blackjack or helping people do their gambling in a casino? Is that the kind of job that a person really draws any long-term satisfaction or self-esteem from? Or is it an artificial, plastic kind of world that in the end a person may well be ashamed of being a part of? If we are looking at the jobs question, I think we should probably analyze just how good those jobs are for people.

The Nevada experience, as I understand it, is grim: one of the highest high school dropout rates. In fact, my information is the highest high school dropout rate in the United States. Anyway, it's a bad statistic for Nevada.

I agree that poverty is a tremendous problem in British Columbia -- and certainly in aboriginal communities. I think everyone on this side of the House agrees. It's an issue that we on both sides of the House must work together to counter. This isn't the way to do it, in my view. Anything that erodes the growing success rate in aboriginal communities of bringing young people through the education system and right on through post-secondary graduation is a very negative step for aboriginal communities.

For the minister to compare the health consequences of gambling addiction to ski accidents or wrecked joints from jogging suggests to me that the minister needs to somehow find the time -- I know he's got a huge load on his plate 

[ Page 4312 ]

-- to really read about gambling addiction. We're talking about something far more serious and far nastier than sports injuries: the absolutely debilitating effects on the problem and pathological gamblers themselves and also on their many victims, including their immediate families, their friends, their employers, society as a whole and the victims of crime committed by gambling addicts.

I think that if the minister had read the material that I have read, he would never have said that, because there is no comparison. The point I was making was that in a $7 billion ministry, such as the Ministry of Health, if you even have a 1 percent increase in expenditures because of an initiative like gambling expansion, you've made an awful dent even in the projected revenues.

When the minister talked about smoking and alcohol, those are things that certainly everybody who talks about gambling addiction considers as well. And there are more parallels there. Often we are dealing with particular personality traits of the individuals involved. There is a tendency to cross-addiction.

I see the minister smiling, perhaps because his colleagues were joking about smoking, and perhaps that is the lesser of all those evils.

But there is a proclivity. . . .

Interjection.

[11:30]

But there are cross-addiction effects. There are similarities, and in a little while I am going to talk about the proposed centre for addiction studies at the University of British Columbia, which I am an unabashed supporter of. The province needs help in all of these areas, but none more so than the gambling addiction concern, because there hasn't been anything to date, and there still isn't.

In any event, we were talking before we launched into all that about the need for an interface mechanism between ministries, and by the minister's response twice, I think I have somehow failed to make myself clear. I am not talking about the consultation process with potential host municipalities or regional districts or aboriginal communities, nor about the consultation process with our neighbours. I'm talking about consultation between ministries. I have the very clear impression from my work in the estimates and from what I've been told in the last two days in these estimates that there is no active interface, no plan of attack to ensure that the minister gets the first warning if it looks as though everyone who is concerned about gambling addiction and its attendant social costs is correct.

I'd like a commitment from the minister, if he wouldn't mind, to set up a sure-fire way that he hears as soon as other ministries begin to detect an increase in the draw for their services that is costing British Columbians heartache, grief or tax dollars because of gambling expansion. Gambling will continue to expand with this plan. He has the power to cut it off at any time, and he may want to if he sees those things happening.

Hon. D. Miller: I did say. . . . I didn't attempt to suggest in my last answer that it's only on the consultation side -- but on the implementation side as well. I appreciate the member's remarks.

I was going to say earlier that we do have 17 casinos in the province currently operating, and there has not been any broad evidence that there's been unusual or untoward problems with respect to social things or crime. So based on our own experience with 17 casinos around the province. . . . There are seven in the city of Vancouver; we've got some crime problems in the city of Vancouver, but they don't appear to be related to that.

Again, with respect to the employment potential, I've worked in a variety of jobs in my distinguished career: short-order cook, dishwashing, longshoring, labourer. I think there are lots of jobs in our society where individuals, not because of themselves or personal reasons. . . . There are simply jobs in our society that don't offer as many rewards as other jobs, in terms of the satisfaction you derive from the job. It's a reasonable statement.

Certainly the ability to earn a living or a reasonable income is one consideration in terms of employment. If one, for example, had a job at the minimum wage -- even on a full-time basis, which is tough these days. . . . What do you make -- $17,000 a year or something like that? It's my understanding that blackjack dealers are making about 30 grand a year. So again, the sort of contextual argument. . . . I'm certain that there are some people in our society to whom $30,000 a year is not very much. There are a heck of a lot of people who, faced with the opportunity of finding a job to make that amount of money, would be delighted.

One of the television stations did a bit of an interview down in Washington State at one of the aboriginal communities, and I was struck by a young woman, an employee of the casino. . . . It's anecdotal; I'm not trying to say this is scientific. But I was struck by one of the employees, a woman, who said: "For the first time in my working life, this job has given me a decent income. I've learned some skills, and I'm making enough money" -- single mother -- "to support my family." Not bad.

There are up sides here that, reasonably, ought to be considered in a discussion. I understand the member's concerns, and I appreciate the level of concern that he has for people, for example, who have gaming addiction problems and those kinds of things. I think that should be discussed, and I applaud the member for raising those kinds of issues. But I think it's equally valid to say there are some up sides here that will be of significant benefit to people, as well.

K. Krueger: The announcement that the minister made a couple of minutes ago about ATM machines not being allowed within casinos, which I think is a really good policy decision. . . . Could we get just a little bit more detail about that -- whether there will be any restrictions about how close casinos can be to an ATM machine? Perhaps that would be hard to enforce, but if they're just outside the door, it will still be rather easy. Is there any consideration of that?

Hon. D. Miller: No. That's too complicated for me to touch.

K. Krueger: I'll move on a little bit to the question of linked bingo and the current plans to develop this. Does the minister support linked bingo and other forms of so-called virtual gambling?

Hon. D. Miller: Just by way of explanation, the linked or what's sometimes called satellite bingo is a game in which players in different regions participate in a common game. 

[ Page 4313 ]

Apparently its introduction in other jurisdictions has had a positive impact in terms of the bingo industry. Alberta and Washington State have successfully introduced linked bingo. Ontario has announced the introduction. They're in the business. So we are proceeding, and we anticipate that by the fall, possibly October, it will be available in British Columbia.

K. Krueger: Has the minister considered the availability of gambling on the Internet? Has the ministry been developing any policy with regard to gambling on the Internet? I've seen some of the various options that people have. People allegedly weren't able to bet on the ones I saw yet. What is the ministry policy with regard to Internet gambling?

Hon. D. Miller: Interesting question. I think it's a federal issue. I actually don't know how you could control it on the Internet -- really, how?

These technologies are posing some modern issues, aren't they? There's the issue, for example, of trying to control access to pornography on the Internet. While rules have come in -- I think on an international basis, and certainly a North American basis -- the technology is one that defies the normal kind of rule-making that governments engage in. I think these are modern challenges. I don't have the answer to the question.

K. Krueger: I've had those worries myself. I don't know how it will be controlled. Certainly the prospect of people being ripped off, if they give their credit cards out to some notional gaming company over the Internet, is very real. That's a real concern.

I'll turn to the question of racetracks and the provision of slot machines to racetracks. If a racetrack wanted to right now, would it be allowed to install slot machines?

Hon. D. Miller: As the minister responsible for the Racing Commission, amongst other things, I did have some very positive discussions with representatives of the racing industry, the commission and the variety of organizations that are part of that. I believe there is an openness to the idea of having slot machines. Their concerns obviously were that this is an important sector in British Columbia. It has to some degree defied the trend that's occurring in other jurisdictions, which have seen declining attendance at racetracks.

I think part of that is the whole issue of sports as big business, and sports really is megabusiness. One only has to look at areas like the NBA, hockey, football, etc., and the value of sports franchises and economic returns -- those kinds of questions. Thanks, really, to the work of my former colleague Mr. Gabelmann, with the expansion of offtrack betting, revenue dedication and those kinds of things, there's been a certain stability that's been brought to the racing sector in British Columbia. My own personal view is that there is an opportunity to expand that. That's another subject.

Really, our policy was based on wanting to maintain stability. Therefore the offer is there for the two racetracks -- Cloverdale and Hastings Park -- to have slot machines installed if they so wish. Now, I also understand that in both cases the lease for the facility is held -- at least in Vancouver -- by the city of Vancouver, and therefore the city would have to approve. I presume the city would have to approve the installation of slot machines at Hastings Park. That issue is out of my hands.

I can only say I would hope that anyone making any deliberations on that question would take into account the interests of this very important, albeit small, sector in British Columbia. It extends into your constituency -- people who are in the business of breeding, those kinds of things. It's important for people in that business. I think the ability to maintain attendance at the track, to maintain a relatively healthy racing sector in British Columbia, is one that all members would support. Therefore, if the question is raised, I would hope that there would be some reasonable approaches to that question by those who have the decision-making authority. But that, as I say, is out of my hands.

K. Krueger: The minister has moved into what I was going to ask about next: municipal endorsement of slot machines.

Just before we do that, perhaps I didn't make my first question clear. I was really asking about an implementation date for racetracks that do want slot machines and do have municipal permission. If they wanted to do it right now, could they? Or is there a date that has been set after which they could apply?

Hon. D. Miller: Yes -- subject to municipal endorsement, whatever form that takes, and the availability of the machines. We haven't received them yet.

K. Krueger: Turning, then, to the question of municipal approval, I'm aware that the Premier, the minister himself, the Minister of Municipal Affairs and probably others have all made commitments that no municipality will be obliged to accept gambling expansion venues that it doesn't want. I'd like to have clarification from the minister that that doesn't pertain just to casinos, but also to slot machines.

[11:45]

K. Krueger: Except for racetracks, right? That was what we were talking about. Essentially, I'm asking: if Vancouver does not want to have slot machines and Hastings Park does, or if Cloverdale doesn't want to have slot machines and the racetrack does, will the provincial government respect the will of the municipalities?

Hon. D. Miller: In the cases cited, I understand that the lease is with the municipality, therefore they have the control. Even if I wished, it's not a provincial lease; it's a city lease. Beyond that, we've said that municipalities have to. . . . If we're going to go on moving away from racing, for example, to a destination resort, it would have to have municipal approval. We're not forcing anybody to do anything here.

I want to be absolutely clear, however, that where there are existing charitable casinos, municipalities do not have a veto. In those cases, it is our decision to install slot machines.

K. Krueger: Once again, the minister is anticipating the questions.

Moving on ahead a little bit, I heard that loud and clear. I don't think municipalities are happy about that. What, then, of a municipality that enacts a bylaw prohibiting -- let's deal with them separately -- slot machines in racetracks? Perhaps there will be other municipalities that include racetracks. Heaven forbid, perhaps Kamloops will one day have an initiative from its racetrack desiring slot machines. If in that instance Kamloops enacted a bylaw against slot machines -- and if we could please just set aside the question of lease 

[ Page 4314 ]

provisions for the moment. . . . If a municipality has a bylaw prohibiting slot machines and a racetrack wants them, who will win the argument?

Hon. D. Miller: I would refer people to the court case between the Lottery Corporation and the city of Vancouver on the issue of the installation of Club Keno machines in bars. The answer is very, very clear.

K. Krueger: I was being kind of delicate, not bringing that up. I'd like a yes or no answer. I think I just got the answer pretty clearly. From many people's point of view, certainly from the opposition's, the province didn't need to instruct the B.C. Lottery Corporation to play the 600-pound gorilla with the city of Vancouver and take them to court. I think everybody already knew who the Criminal Code of Canada allows the federal government to delegate responsibility for gaming to, and that's the provinces.

But there's a question of respect here -- respect for municipal and regional districts and indeed aboriginal governments, and respect for their ability to control activities that take place within their jurisdictions, within their borders. I believe that those levels of government ought to have the ability to enact a bylaw and prohibit certain gambling activities. I think the minister has just said that he doesn't believe that, so I would appreciate a really clear answer for the record. Yes or no, will the province override municipal bylaws prohibiting slot machines where the province is willing to allow them?

Hon. D. Miller: I can confirm that we respect the law. With the matter of respect, it has been my experience in life that respect is a two-way street, so we'll respect the law.

K. Krueger: I'm getting some very clear direction from the House Leader, so we'll come back to this.

Hon. D. Miller: 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 of Supply B, having reported progress, was granted leave to sit again.

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

Point of Privilege

The Speaker: Please proceed, minister.

Hon. J. MacPhail: The member for Okanagan-Penticton raised a purported matter of privilege against the Deputy Speaker of this House. It's clear from the member's comments that he disagrees with the ruling of the Deputy Speaker. He knew that he couldn't directly challenge a Speaker's ruling, so instead the member has decided on what I consider to be an indirect approach. He has decided to attack the character of the Deputy Speaker, believing that somehow he can achieve by indirect means what he cannot achieve directly.

It turns out that the member got his facts wrong. The material he and his party colleagues tabled outside the House contains many incorrect assumptions together with some false innuendo. The Deputy Speaker at all times disclosed the pertinent details of the financial arrangements between her MLA office and the Victoria-Beacon Hill NDP. The member asks the Speaker to rule that he has a prima facie case of privilege on this basis:

"I suggest that there is reason to believe she" -- the Deputy Speaker -- "made the decision in order to remove the question of her own actions from the scrutiny of this House, as a referral of this issue for debate in the House, with possible referrals for investigation by a committee, would have likely uncovered details of her own actions."

So, hon. Speaker, I would ask you to consider that really all that's been uncovered here is an attack by the opposition that is of a partisan nature and in no way a matter of privilege.

The Speaker: Thank you, hon. minister.

Hon. J. MacPhail moved adjournment of the House.

Motion approved.

The House adjourned at 11:54 a.m.

PROCEEDINGS IN THE DOUGLAS FIR ROOM

The committee met at 10:13 a.m.

ESTIMATES: MINISTRY OF SMALL BUSINESS,
TOURISM AND CULTURE
(continued)

S. Hawkins: Before we left last night, I was asking the minister questions about government offices and the closures 

[ Page 4315 ]

that affected constituents of mine. Just for background information -- and I'm sorry if I'm making the minister repeat herself -- I'm wondering how many government agent offices there were in the province before the closure.

Hon. J. Pullinger: There were 60.

S. Hawkins: I understand that some were considered major and some were considered not so major. I understand that Kelowna was one of the major ones. Can the minister give me some guidelines on how many were considered to be bigger offices and how many were smaller?

Hon. J. Pullinger: We don't classify government agents into major or minor, hon. Chair. There are obviously numerous government agents -- 58 around the province now. Most of them are in small centres, where there is otherwise no or very limited access to government services.

[10:15]

Hon. J. Pullinger: I don't believe the services are identical in every office. Generally, they provide things such as revenue collection of rural property taxes, consumer taxes, MSP, motor vehicle fines, etc.; licence issuance of a variety of kinds, such as for motor vehicles and fishing, hunting and marriage licences; vital stats certificates; other services that fulfil statutory appointments, such as gold commissioners, district registrars of voters, provincial collectors, commissioners for taking oaths; and some administrative services.

S. Hawkins: How many offices were closed, and where were they?

Hon. J. Pullinger: There were two offices closed in the largest cities we serve: Kelowna and New Westminster.

S. Hawkins: Can the minister tell me what services were provided in those two offices -- the Kelowna office and the New Westminster office -- and if the services were identical?

Hon. J. Pullinger: No, the services weren't identical. Rather than use a great deal of time reading a very long list of services into the record, I'll provide the member with two documents, one for New Westminster and one for Kelowna. These not only outline the services but outline where people can continue to get them in the community or how they can access them.

S. Hawkins: Can the minister tell me if there were more services provided in the Kelowna office than in the New Westminster office?

Hon. J. Pullinger: No, they were just different.

S. Hawkins: Can the minister confirm that the New Westminster office didn't do motor vehicle services and the Kelowna office did?

Hon. J. Pullinger: That's correct. But New Westminster did other things, such as a very large volume of fish and wildlife licensing, which was very different from Kelowna.

S. Hawkins: I'm still trying to get a handle on what criteria were used to decide which offices would close and which ones would remain open of the 58 that are now open. And for the two that did close, I wonder if the minister can tell me what volume there was of clients -- if that's the way they measured the services provided -- or of transactions. What was the difference between the New Westminster and Kelowna offices?

Hon. J. Pullinger: With respect, I would refer the member to the Blues of yesterday. I answered that question twice.

S. Hawkins: Then I'll stick to the Kelowna office. I wonder if the minister can tell me if the volume in the Kelowna office increased or decreased in the last five years.

Hon. J. Pullinger: I'm not absolutely sure. I would assume it would increase as the population increased, but that was not the criterion. As I said last night, that was not the basis for deciding which offices to close; the basis was access to government services.

S. Hawkins: And I asked the minister last night if they were looking at access to government services and if they did a report. If there was a report -- and hopefully, there was -- to guide the minister on why these offices would close, would she make that criterion or that analysis available to this side of the House?

Hon. J. Pullinger: I've twice explained in detail why we chose to close the two offices. I've told the member that we did not do a report per se, and I've also told the member that I would provide her with our documents for New Westminster and Kelowna, which detail what services were available and how they are still available to constituents. I'd be quite happy to provide all of that information.

S. Hawkins: We know that the Kelowna office had been getting busier in the last five years, and I think the minister did recognize that. That is why there was an extension office: for better service and for the volume of clients that the government agent office was seeing in Kelowna. There was one opened in Westbank. There is a great need for those services, and at a time. . . .

I would remind the minister -- because yesterday she said that this side of the House wanted to cut five times as much -- that this side of the House didn't promise two balanced budgets and a surplus. This side of the House did not do that. That side of the House said they were going to keep services for people. We never heard last year that there was no money for these services. We didn't hear that. What we heard was that services were going to get better, that health and education were protected under this government, and we know right now that that's not true.

I want to know from the minister: how many employees were in Kelowna, and what are they doing now? Those two are first.

The Chair: Members, the Chair needs to remind members that we are dealing with the estimates of the Ministry of Small Business, Tourism and Culture.

Hon. J. Pullinger: There were 18 staff members. I would advise the member that all government agents in British Columbia have been getting busier as the population grows 

[ Page 4316 ]

-- not just in Kelowna. I am very proud of the staff in my ministry, who worked very, very hard. In fact, I believe we were the first ministry to complete the process of ensuring that all staff members had either another placement as vacancies came up after the downsizing, or other satisfactory arrangements.

S. Hawkins: There is an office in Westbank that's sitting empty now, and that is because of the decision to close the offices. I understand that there is a four- or five-year lease arrangement for this office. Is that correct? Can you give me the lease arrangement for this office?

Hon. J. Pullinger: I believe there are some discussions ongoing. The building doesn't belong to this ministry; it belongs to BCBC. I understand that BCBC has some irons in the fire, as it were. I would direct the member to that minister to follow that line of questioning.

S. Hawkins: Perhaps, for my own clarification. . . . I understood that this lease doesn't transfer to BCBC until after six months. The office just closed January 31, so I understand the ministry is still responsible for that lease for six months after the office closed. Is that right?

Hon. J. Pullinger: There was no penalty for vacating that building early.

S. Hawkins: How much notice did constituents get of the closure of the government agent office?

Hon. J. Pullinger: The announcement was made either at the end of October or at the beginning of November. The public was provided with a detailed document a month ahead of the closing that made it very clear where alternative services could be found.

S. Hawkins: I understand that the minister and the Premier received a petition with 5,140 names, asking for reconsideration of the office closure. What was done with that?

Hon. J. Pullinger: It was received in my office, I believe, and noted. I certainly appreciate people's concerns, and we have made every effort to ensure that people still have access to services.

S. Hawkins: I can assure the minister that if the decision was made for access to services, there may be those services in the interior somewhere. As I reminded the minister yesterday, when I met with a group of seniors a couple of months ago, I was told that one of those services was a 124-kilometre round trip away.

Hon. J. Pullinger: Which one of the services?

S. Hawkins: Well, I will get details for the minister on that.

The minister did write a letter when I reminded the Premier that there is a high percentage of seniors in the riding. We're looking at a semi-rural, semi-urban area of the province -- one of the largest populations or the largest population east of Hope. We have people. . . . I invited the Premier to come out this winter and drive some of those roads. We had a very hard winter. The roads aren't in great condition, and certainly we put people at risk when we're asking them to do 100-kilometre round trips to access services.

In a letter that the minister wrote to me dated January 24, 1997, she stated: "Ministry staff will assist in any way they can to ensure the public continues to receive quality service. Customer services are a prime concern, and I believe we can accommodate the needs of the public through other existing agencies."

I understand that some of the services are now being offered through ICBC. It's interesting to note that there are now questionnaires at the Kelowna motor vehicle branch that are asking about customer service. I have one ready to send to the minister. I receive a lot of calls like this, and now I'm actually receiving copies of questionnaires.

The questionnaire starts with: "What kind of service did you require today?" This fellow required a driver's licence renewal. "How long did you expect to wait?" Well, "15 to 20 minutes." "How long did you wait?" It was one hour and 20 minutes. It asked: "How would you rate the service that you received?" He said poor. "Why?" "There were too few clerks serving the long line of people waiting." He goes on to write: "I arrived at 11:30 to avoid the noonhour rush, and there was a line of 14 persons ahead of me." That extended his wait. He said: "Many people left in disgust." He said: "The clerks on duty were trying the best they could. They were doing an excellent job. They were pleasant and efficient, but there were too few of them: only two on the front desk."

If you're looking at delivering the same kind of service you did, you're not achieving that by funnelling people into offices that are way too busy and have way too few people. I wonder if the minister can comment on that.

Hon. J. Pullinger: There certainly are drivers' licensing and fine-payment services available in Kelowna. I am pleased at the minister and ministry responsible putting out questionnaires to get feedback from the public so that they can improve the service.

S. Hawkins: I just want to close by saying to the minister that I don't think this was a well-reasoned decision. The Kelowna office was the busiest office in the province. In the last five years, the volume had expanded. They did over 200,000 transactions a year. Those are the stats I got from our government agent office. The revenue from those stats. . . .

I understand that regional district officials have been trying to work with the government to try and get some of those services back into one centralized area so we can provide that population with some semblance of service. It has had a negative impact on groups like seniors, who now have to drive unwieldy amounts of time to get the service that was there before.

[10:30]

I'd still be very, very interested to get any kind of analysis of how the decision was made to close this office over the other offices in the province and to leave other offices open. But obviously, there doesn't seem to be anything in writing, and it appears that the decision was made on some other criteria. If there are any criteria that can be measured in some way, 

[ Page 4317 ]

I'd be interested to see that analysis. Obviously, it's not forthcoming. I'm just voicing my displeasure, on behalf of my constituents, that this government chose to close that kind of service for the people in the riding.

Hon. J. Pullinger: For the record, Kelowna was not the busiest government agent in the province. Maple Ridge is. If you live in Atlin, you may have to drive 120 kilometres one way to get any kind of service whatsoever. The member complains about services for seniors, yet I see that ambulance payments, the Assessment Authority, liquor licensing, voter registration, rural property taxation, provincial sales tax, Medical Services Plan, etc., are all available in the community, through the mail or through payments at the local credit unions or banks.

I have said repeatedly to the member how we made this decision. It was a question of either closing a large number of rural offices, which the member clearly prefers, or closing a couple of offices in the larger communities where a large variety of services are available either right in the community or at the banks, through notaries public, credit unions, by mail or at a relatively close alternative government agent office, which is comparable to the distance most British Columbians drive for service.

The people of Kelowna are well served. There are numerous government offices right in Kelowna, and we have ensured -- as I told the member -- that there is an alternative way to reach all of the services that were available in that office. My highest priority is to ensure that the services remain accessible to people. The people in Kelowna continue to have much better accessibility to government services than many, many areas of the province.

I will be happy, as I said, to pass on the paper that I told the member was available. The documents have laid out every service that was available in the Kelowna office and the New Westminster office and the alternative services, as well.

S. Hawkins: I think I asked this question before, and I don't remember an answer. I asked the minister about how you measure how busy an office is. Obviously, according to the ministry's statistics, Kelowna isn't the busiest office. So how do you measure how busy an office is?

Hon. J. Pullinger: I'm advised that the calculation is done by staff by measuring the number of transactions per FTE.

S. Hawkins: Where did Kelowna rank in the ministry's measurement of how busy their office was?

Hon. J. Pullinger: I don't have that information at hand, but it's not relevant to the decision. The decision was based on the availability of services to the people involved in New Westminster and Kelowna.

I will explain to the member, seeing as she apparently doesn't remember. Twice last night I explained that I had a choice of either closing down ten or 12 small government agents around the province, which would mean that people would have to drive hundreds of kilometres one-way to get services. . . . In many, many areas of the province there is no other way to access government services. Or I could follow the pattern that has been in place for a long, long time, which I believe is a good one; that is, in large communities where alternatives do exist and such things as public transit exist, we can provide all of the services to the public at least as well as they do in the outlying regions. That was the other alternative. Albeit I would rather not close any offices, given that we had to close some, I think that was a much better alternative.

I understand that the member disagrees. This is her constituency, and she would rather have had other ones closed -- rural ones, perhaps. But the fact is that if we are going to cut the cost and size of government, which I know the member opposite is a strong advocate of, that means that we have to cut some services. I have tried my very best, as have staff, to do that with a minimum disruption to the public, and I think we have achieved that.

The Chair: The Chair needs to remind members in regard to repetition in estimates debate.

S. Hawkins: For the record, I don't think I remember ever saying that I supported a large closure of rural offices. I don't remember saying that. If the minister wants me to, I can give her lots of examples of waste in government and spending that they did. They could have looked at savings there first before closing services to people. I can do that if the minister wants to get into that debate.

I have never said that I supported cutting services for rural areas, and I would consider my constituency partly rural. Services in that constituency serve a large rural population around Kelowna. If the minister wants to put those words in my mouth, that's up to her, but for the record, I have never said that. What I've said is that I know there is government waste out there.

I'm just trying to get to the bottom of how this decision was made. There don't seem to be any clear guidelines for how this decision was made to cut services to a constituency that has a large population, that serves a large rural population and that has a large number of seniors and people who can't travel to some of the offices that the minister says are available to them for the services they need. Some of these offices are an hour or an hour and a half away. They might only seem to be 40 or 50 or 60 kilometres away, but come and drive those roads in the wintertime, and you'll see that it takes a little bit longer to take those roads for that distance than it does in the lower mainland, perhaps, where there is easier access and more roads for people to take.

I have no more questions. I look forward to getting some of the information that the minister has committed to giving me, and I'll continue this discussion. Perhaps I'll send the minister the letters I've received as far as the services that people are now getting in the offices that she says are now there to serve my constituents. I think there was another thing I promised the minister. I'll check the Hansard, and she'll get a copy of that, too.

Hon. J. Pullinger: The member has talked extensively about inconvenience to seniors. I would appreciate having the details of which services they're having trouble accessing, if that's the case. As I say, I know that things such as ambulance payments, assessment authorities and commissions for taking affidavits are available. Drivers' licences, fish and wildlife licences, land title searches, liquor licensing, the manufactured home registry, maps, MSP payments, the personal property registry, proprietor-partnership registry, business name approval, provincial sales tax, residential tenancy, etc., are all available. The overwhelming majority of those I've listed are available in Kelowna.

If in fact there is a gap, then I'd like to know about it -- or the minister responsible for that service would. But I'd like to 

[ Page 4318 ]

know about it, as well, because we have gone through every service and attempted to -- and I think, successfully -- provide that service in an alternative way.

I. Chong: I'd just like to follow up with a few questions, still continuing with the government agent offices, because her response certainly elicited more questions. When she was talking about measurements and the number of transactions, was a different weighting applied when it came to those that are walk-ins and those that are call-ins? Because surely, if an office is 90 percent call-ins at the present time, even though it serves a large rural area. . . . If people prefer to call in, would that not suggest that they could just as easily call another office in another location?

Hon. J. Pullinger: After consulting with staff, I am assured that the majority of transactions are in person. There certainly are telephone information calls. They are not tracked in detail; it would take a whole lot more staff and time and dollars to track that, obviously, with the volume that goes through government agent offices. Most of the transactions are in person, people coming in. Some are simple; some are very complex and take a lot of time. Information requests -- both walk-in and telephone -- and financial transactions are counted.

I. Chong: In the decision-making process in closing these government agent offices, was there any consideration given to the resources available through local governments and regional governments? Is there some initiative available or planned to help in the transition for those who have to go to local governments and regional governments for more information because they're not getting it through the government agent offices?

Hon. J. Pullinger: These are all provincial services from different ministries that we're dealing with, and they're all still available in provincial offices.

I. Chong: In the other area of government agent offices. . . . In the Kelowna-Westbank situation where the satellite office operated. . . . Are there any other areas throughout the province which also operate in a similar manner -- where there is a major office and then somehow they branched off and created a satellite office? If there are, could she please advise us which ones?

Hon. J. Pullinger: No, that was a pilot only, and there are no others in that same way. There are some rural areas where a government agent spends some time in one community and some time in another community, so they have a part-time government agent.

I. Chong: For the record, I was writing, and I wasn't paying attention. I apologize for that. Can the minister confirm that there are 18 government agents in total, with the 58 government agent offices. Is that what she said?

Hon. J. Pullinger: No, that's not correct. The number 18 referred to the number of staff in Kelowna. There are 58 government offices around the province.

I. Chong: Can the minister advise whether, in each of the remaining offices, they are all staffed with at least. . . ? I heard earlier that she said that sometimes they are part-time government agents. Perhaps she can clarify that for me. I was assuming that if there were 58 government agent offices, there would be 58 government agents. As well, I understand there are also some deputy government agents. Can the minister advise as to the full complement that the ministry has?

[10:45]

I. Chong: How does the minister make the decision as to how an office qualifies for a deputy government agent? Is it, again, for servicing or the number of transactions? What are the criteria? Five seems like an awfully low amount, given that there are 58 offices open.

Hon. J. Pullinger: The staff are deployed according to need, and obviously, if you have a large contingent of staff, you will need more managerial staff. It's simply a calculation of function.

I. Chong: Yesterday when we discussed the government agent offices, the minister advised that staffing requirements were different in each office, and I respect that. Can the minister advise what the range is -- the minimum to the maximum -- in these government agent offices? Are some run with three? Is the maximum in some offices 18? Can she give us that range, please?

Hon. J. Pullinger: With the closure of the two offices in the larger communities, the range would now go from 17 down to about two.

I. Chong: I would just like to quickly canvass the New Westminster office that was closed. Can the minister advise whether, with the closure of that office, there are other surrounding government agent offices that are supposed to, I suppose, provide the services that the constituents in that area are no longer able to use? Are there government agent offices surrounding that area that people can call, or are they expected to get the service they require from ministry offices that are set up already in New Westminster?

Hon. J. Pullinger: People from New Westminster could go to Maple Ridge or Chilliwack; however, as we have done with Kelowna, we have endeavoured to ensure that all of the services are available by mail, by phone, or in the community, wherever possible.

I. Chong: Before we leave this area, which I'm sure the minister is anxious to do, can she advise what savings were realized with the closing of each office? What was the cost to run each office on an annual basis, and can you provide those figures for us?

Hon. J. Pullinger: The closure of Kelowna-Westbank affected 18 staff people and saved $830,000 annually; New Westminster, with 12 staff members, saved $595,000 annually; staffing reductions in Clinton, Invermere and Fort St. James resulted in $160,000 of annual savings -- for a total of $1.585 million annually. That was part of a $13 million budget reduction in that part of my ministry.

I. Chong: Do those represent the staff costs, the operating costs for office equipment, etc.? Does that also include your rental costs in terms of your building lease costs?

[ Page 4319 ]

Hon. J. Pullinger: Those are all of the costs that were incurred as a result of running those offices. For the information of members, we are also now in the process of scaling down the physical space in a number of offices for further cost reductions. Nanaimo is the one that I'm most aware of, because I just recently opened the smaller office, which, again, saves a significant amount of money each year.

G. Abbott: I think the minister said $830,000 in savings were achieved by the closure of the Kelowna offices. What portion of that figure was achieved through staff layoffs?

Hon. J. Pullinger: I've just had it brought to my attention that the actual total savings is $1.98 million, not $1.585 million, as I said earlier. It was over $5 million for salaries and benefits overall. I'm sorry, I don't have the breakdown for each individual office.

G. Abbott: We've been throwing a few figures through here fairly quickly in the last few moments. Was the $5 million the overall savings achieved by all of the offices across the province? The $1.9 million was the total savings from the closure of the two Kelowna offices -- is that correct? Or was the $830,000 for those two offices?

Hon. J. Pullinger: Thank you for that question. I just got clarification. The $830,000 was the Kelowna office. The $1.98 million was the overall savings from all of the changes we made in government agents. And the $5 million is not government agents alone, as I incorrectly stated, but is for that branch of my ministry, the small business division. So the $5 million in staff savings was the whole division.

G. Abbott: Just for clarification here, the closure of the Kelowna office involved 18 staff. The total savings -- presumably inclusive of whatever savings were achieved through staff layoffs -- was some portion of that. Could the minister advise me how many of the 18 staff remain with the provincial government in other capacities?

Hon. J. Pullinger: In my ministry there was a total of 139 positions cut. I don't have the details here of what each individual employee did -- whether they took early retirement or filled a vacancy because of the hiring freeze in another part of government. I can give the overall numbers, but I don't have a breakdown for Kelowna.

There were 32 voluntary departures from the public service three early retirements; three reduced their hours, 11 auxiliary or seasonal positions were eliminated, 17 vacant positions were eliminated, and 82 people were placed in vacant positions elsewhere in government. Those vacant positions were as a result of the hiring freeze that came into effect earlier in anticipation of the downsizing.

G. Abbott: Judging from that, the bulk of the staff in offices across the province -- 82 out of 139 -- elected to fill positions which were vacant as a result of the provincial hiring freeze. Is it still fair to say, based on that proposition, that in fact the net savings to the province were still in the range of $1.98 million? Or would those positions that were vacant because of the hiring freeze not have been filled were it not for these positions being eliminated?

Hon. J. Pullinger: Blue book over blue book, we're 139 fewer FTEs from last year, and the savings in government agents is $1.98 million this year over last.

G. Abbott: That wasn't quite the point I was getting at. I already had that information. I guess I was making a rather more obscure observation that positions which were vacant as a consequence of the provincial hiring freeze would, I think in most instances, remain vacant, given that there was a hiring freeze. But because the government agents offices were closed down, obviously the government made an attempt -- and perhaps appropriately -- to find places for those people. As a consequence, they filled spots that were part of the hiring freeze. That was the rather more obscure point that I was attempting to ventilate.

Hon. J. Pullinger: In our ministry we made every effort to not cause people and their families distress. We did not fill positions that otherwise would not have been filled in anticipation of the downsizing or so we could move people. The member could argue one way or the other, but the fact is that blue book over blue book, almost $2 million was saved in government agents' salaries and 139 fewer positions were filled in the ministry -- positions filled by people who worked and provided the kind of services that I know some people miss. I absolutely recognize that cutting government means cutting people and cutting services.

It's a bit of a moot point whether they were frozen for a month in order to not hire new people and then toss them out again, or whether we in fact followed the pattern that some other governments do, which is to just simply issue pink slips to hundreds of people and their families. Our choice always is to try to manage change so that we cause as little disruption as possible to workers and their families, and I'm sure the member would agree with that and would probably applaud it.

G. Abbott: Under some circumstances I certainly would applaud that. I think members on all sides of the House try to take the compassionate circumstances of families into consideration when these kinds of adjustments are made. I guess where we would have some difference with the government is clearly in some of the rhetorical flourishes we have heard from -- for example, the Premier with respect to how many positions he was going to be eliminating from government. He made quite a spectacular performance of that, particularly during the last election campaign, by a remarkable coincidence.

I see the Chair showing some visible signs of frustration here. I'm sure he's hoping that I'll move along quickly, so I'll just leave it at that. Regardless of the Premier's rhetorical flourishes, I understand that the net number of positions that were in fact eliminated was 14.

Hon. J. Pullinger: Oh, come on.

G. Abbott: I don't want to inspire the minister to get up and leap to the defence of the Premier.

[11:00]

G. Abbott: Good. This is good. A debate has broken out here, and we always welcome that.

Where I was going next with my questions was just some clarification of the term "busiest." I listened with absolutely rapt fascination to the earlier debate of members beside me on the issues surrounding the closure of these offices. One of the questions was: what was the busiest office in the province? Just so I'm clear, I think it was suggested at one point that the 

[ Page 4320 ]

New West office was in fact busier than the Kelowna office. Depending on how you define that, it appears, from what I've heard, that "busiest" in the case of this ministry would be defined by the number of transactions which occur at an office, divided by the number of FTEs which occupy that office. Based on that, I guess Maple Ridge is the busiest. It would appear that the savings in New West were $595,000 with 12 staff eliminated; whereas in Kelowna it was 18 staff and $830,000. So it would appear on the surface that in fact there were probably far more transactions in Kelowna. The term "busiest" has been determined by transactions divided by FTEs. Can the minister confirm that?

Hon. J. Pullinger: I've provided the House with the way the ministry calculates busyness. In managerial terms, that's what is useful to the ministry. That calculation was not a factor in determining which offices were closed.

I've said numerous times, and I will say it once more, that the way it was determined was the availability of alternative services in the community. The largest communities, Vancouver and Victoria, have no government agents, for that reason. For the same reason, I opted to choose the government agents in the larger communities, rather than the smaller ones.

I certainly hope that all of my staff have taken note that the Liberals object to the fact that there was virtually no one simply pink-slipped in this downsizing process and that they would obviously do things very differently and just simply hand pink slips to 3,000 people, rather than trying to manage it. They clearly object to that process, and I'm really sorry they do.

The Chair: The Chair needs to again caution members in regard to repetition of debate.

G. Abbott: I'm going to studiously avoid any kind of repetition here. I just want to briefly respond to the very provocative comments of the minister here.

Hon. J. Pullinger: I was responding to yours. Do you want to keep going?

G. Abbott: Yeah, sure. We can do that -- but only through the Chair, hon. minister.

We have never made the statements that the minister attributes to us here. All I was saying was that there is a remarkable discrepancy between the rhetoric of the Premier, particularly during the election period, and what we subsequently heard here today.

My next question is with regard to the community of Houston. I gather Houston's government office was considered for closure, but then the decision was made to keep it open. Is that correct?

Hon. J. Pullinger: I had a long list presented to me of offices in small communities that I could have closed. Houston, I believe, was among them. I believe Osoyoos was, and Terrace. There was a number of them. It was a long list of offices. It would take closing ten or 12 small offices around the province to find the same savings as closing two in larger communities. That's why I made the decision I did.

G. Abbott: What I was trying to do was let the minister leave this particular area of government closures on a very positive note. It appears, for a variety of reasons, that Houston was slated for closure, and the decision was made to reverse that and leave it open.

Can the minister provide some assurances to communities like Houston that over the next year or two -- or in the foreseeable future, if we can characterize it as that -- government agent offices in communities of Houston's size will be safe and secure for that time?

Hon. J. Pullinger: I think the fact that I have clearly made a decision to close government agents where alternative services are available -- in large centres rather than in the small centres -- speaks very loudly to what my intentions were and are. I also simply want to ensure that the member is clear that Houston was not slated for closure. It was simply one of many under discussion; it never got as far as being slated for closure. If I had not closed Kelowna and New Westminster, I would have had to look at offices such as Houston, and the member is correct in that.

I. Chong: I thank the minister for all her answers in response to our questions regarding government agent offices. Clearly they are a very important function of government. Where we have regions which do require services of government, we do want to make sure the constituents there are well served. Sometimes a phone call will suffice; other times a visit to the government agent office is very much necessary. We do want to assure the minister that we have looked at the decisions that were made, because we are getting calls from constituents in those areas. I will leave the government agent offices at this time and move onto another area -- unless it happens to come up again in relation to some of the questions I'm about to ask.

Yesterday when I asked about the reduction of FTEs. . . . I do note the 139 reductions in total in the ministry, and government agent offices accounted for about 31 of those 139 reductions. The other ones included 38 from the regional economic development program. Can the minister advise us whether there is any regional economic development program left, or if this reduction is a percentage? Are half of the regional economic development officers gone -- 10 percent, 20 percent? Can she give us some idea of what this means?

Hon. J. Pullinger: This ministry no longer carries responsibility for economic development in the way it once did.

I. Chong: I would then like to ask the minister: at what point did this mandate change? The business plan of 1996-97 very clearly included economic development and assistance to regional economic development as one of its goals. Unfortunately, not having the business plan for the current year, we aren't privy to that kind of change in the mandate and the role.

If regional economic development is not a part of this ministry, I have to ask the minister: where would that fall? Clearly, this is a ministry of small business. Small business and regional economic development very much go hand in hand. So if her ministry is no longer involved in this, who would small businesses turn to?

Hon. J. Pullinger: The model that we had was very effective in some areas; it was very ineffective in others. In meeting with different mayors and councils around the province, there has been, in general, a concurrence with that. E&I tends to lead the economic development process in B.C. now, and we have added tools that are much larger, much more effective and much more targeted. There seems to be a fairly high degree of consensus that these tools are providing good economic development support throughout the province.

[ Page 4321 ]

As one of the member's colleagues mentioned yesterday, we are looking at a forum for the north, to look specifically at economic development. The member may want to canvass that more extensively. Although it's future policy and there probably won't be much there, you may want to talk to the Minister of Employment and Investment about that.

There are tools such as Forest Renewal B.C. It does a large amount of very targeted, very effective economic development. We have the Job Protection Commission. We have Fisheries Renewal B.C. now. We have industrial adjustment services from the federal government that provide those kinds of services. We have the resources job commissioners; Education, Skills and Training. We have things such as the Columbia Basin Trust, which has $77 million of downstream benefits for those communities to use, etc. There is also a great deal of support still coming from my ministry to support small business and cooperatives, which is, of course, economic development.

So while the function that we had was very good -- we had wonderful people delivering good service -- not all of the programs and the money spent was spent in the best way possible. In this era of downsizing and huge cuts that we've had from the federal government, we simply have to make our resources count, and that's what we've done.

I. Chong: I want to respond to the minister's comments regarding the issue of downsizing and making the dollars count more. That can't be any further from the truth, when we on this side of the House have stated in the past. Where resources are wasted and there is ineffective use of taxpayers' dollars, we certainly agree that we do have to take a look at where we could best spend these dollars and that there is no duplication. If the minister is saying that there is duplication within one ministry and another and that's why her ministry is no longer involved, I can understand that. But I fail to see and understand where those duplications are at this point, given that I thought this was the lead ministry to deal with economic development. That's one of the reasons why I was quite surprised that this particular program would be eliminated from this ministry.

When the minister mentions that there are things in place like Forest Renewal B.C., Fisheries Renewal B.C., job protection and all those others that she mentioned earlier, is she suggesting that Forest Renewal B.C. now takes over something that was previously handled by her ministry?

Hon. J. Pullinger: We have a variety of agencies delivering economic development in a variety of ways. This ministry did deliver FRBC programs -- the REDOs deliver programs for FRBC. FRBC now delivers its own program.

With the Employment and Investment ministry that was created a few years ago, we have taken a much larger, much more focused and targeted role in economic development than has been seen in B.C. for some time. There are a variety of tools available. I've listed some of them. We have an entire ministry that is devoted to employment and investment -- i.e., economic development. That function is carried out very ably by that ministry, and we are seeing lots of activity from that ministry. I would encourage the member to participate in the estimates of that ministry, as well, to determine in some detail what that ministry is doing. The lead is from Employment and Investment now. This is the Ministry of Small Business, Tourism and Culture, and we provide support to those areas.

I. Chong: The comments of the minister certainly lead to a number of other thoughts. If the Employment and Investment ministry is a fairly new ministry, we suddenly have a new, larger bureaucratic nightmare than we anticipated. If the Small Business ministry was originally to handle small business issues and it suddenly is no longer able to provide the kinds of initiatives and programs that small businesses are looking at because we want to set up a huge, new bureaucratic ministry -- the Employment and Investment ministry, which is fairly new, with its own structure, its own minister, its own minister's office -- surely this is not a way of downsizing. If anything, more concentration and focus should have been on the Small Business ministry.

[11:15]

When I hear the minister saying that some of these programs are now handled by the Minister of Employment and Investment, then I have to wonder what is left. Tourism British Columbia has been handled the same way. You're moving it to a Crown. What is left? Why is the ministry still in existence when everything was originally thrown into it?

I would love to participate in the spending estimates of the Ministry of Employment and Investment, but as this minister well knows, these estimates were called concurrently, unfortunately, with no consultation with members of opposition. Recognizing that they are two very linked ministries, we would certainly want to participate in both. These two ministries are currently being debated simultaneously in the two Houses, so it makes it almost impossible for us to ensure that we canvass the Ministry of Employment and Investment in an equally effective way.

With that, I'd like to hear the minister's comments as to what she considers would be left for her ministry to deal with.

Hon. J. Pullinger: Forgive me if I'm a little frustrated. We just went through an hour of complaining about cuts to my ministry, which are part of huge cuts to government and to the budget of government -- $750 million. In this ministry we've had a massive cut -- 35 percent. Others have had the same. And in the next breath we're saying that we're growing government. It can't happen both ways.

For the member's information, British Columbia has the lowest per capita cost of government in the country. We have the leanest bureaucracy in the country. The fact that we have reshaped ministries to bring them into the 1990s and prepare them for the twenty-first century does not mean that there's a lot more bureaucracy. In fact, if the members care to look, you would find that all of the programs of government have been revisited and gone through to determine whether they are still relevant, effective and efficient. What has happened here is that rather than continuing the program that has been around for 15 years, 20 years -- I don't know how long it's been around. . . . The world has changed. We have global markets. We have a much different approach to economic development. We have different issues to deal with than we did 15 

[ Page 4322 ]

or 20 years ago, so the approach of just sending out a cheque for $10,000 or $30,000 to a community is no longer effective in regional economic development. We, therefore, have collapsed a number of government functions into one ministry and given it a new focus, and we've created some new and innovative tools, such as Forest Renewal B.C., Fish B.C. and the resource jobs commissioner. We are very effectively using those tools around the province to stabilize instabilities and to provide a better integrated economic development function than I've ever seen in the years that I've been around. Because we change something doesn't mean it's bad, nor does it mean that it grows bureaucracy which. . . . Government, in the eyes of the members opposite, is clearly bad, except when it's missing from wherever they want it in their communities.

Let's be realistic here. We are in an age when the members opposite are the greatest advocates of cutting the cost and size of government. We've done some of that, and we've done it in the most effective, efficient way possible. We're going through programs to see what's effective and what isn't, and we have determined that there are better ways to deliver economic development. We're doing that on this side of the House, and I would suggest that the members ought to be applauding that kind of initiative rather than criticizing it.

Similarly, this ministry still delivers programming to small business. We provide publications, and we work with chambers and other organizations. We have initiated, with the federal government, in a very, very good leading-edge partnership, the one-stop business registration centres. I think there are nine up and running, around the province. In every case the community, the business community and the chambers of commerce, many of whom are affiliated with the party opposite, have stood up and applauded this government.

We are delivering some leading-edge services to small business. We've also just put on-line an interactive business planner, which is extremely helpful to the growing numbers of entrepreneurs and microbusinesses. People can now sit down at a computer and pull up information. They can go through the process, with a huge amount of information available to them, to develop a workable, real business plan, which is a huge stumbling block for entrepreneurs and microbusinesses. Now they can come out of the end of the process with something they can take to the credit union for financing. That has been universally applauded by the small business community.

This ministry also has an advocacy role for small business. For instance, there's a 10 percent tax cut. We now have the lowest tax rate for small business in a decade in this province. I think that cost something like $29 million. You'd have to check that with the Minister of Finance, but that figure floats to mind. We had a two-year tax holiday for new small businesses to help them get going. We reckon that about 2,000 businesses will be able to take advantage of that, and we just extended that for another year.

We are doing the things that small business wants through this ministry. We're providing advocacy through this ministry on a variety of issues. We have fewer staff; they work very hard. They are very skilled and dedicated, and they provide outstanding service to the small-business community. I would appreciate it if the member opposite would acknowledge the good work and the good programs that my ministry delivers, rather than slagging them. We do a great amount of work.

Similarly, while we're restructuring the way we deliver the tourism marketing, it's not disappearing. I'm not putting it on a raft and setting it adrift. There's still $18.4 million, 61 people and a Crown corporation to deal with. I will still be involved with that function; it's still part of my ministry. We still have policy development to do; we still have advocacy to do; we still have land use issues to deal with; we still have development issues to deal with. Believe me, there's more work than we can handle in this ministry.

Then, of course, on the culture side there's a great long list of things, which I'm sure that we'll explore in depth later. But there have been some remarkably good programs delivered from that part of my ministry, as well. So I hope that those comments have enlightened the member somewhat to the things that we do, and do very well, in this ministry.

I. Chong: I just want to make it clear for the record that I have never, ever suggested that this ministry cannot do, and cannot provide, for small businesses. They do a lot of good work.

I have been involved in small business for some 18 years and have consulted to small businesses and have seen how government programs have hindered them, as opposed to assisted them. I've always stated, as I did last year, that I expect that this ministry is the one that is mostly forgotten by the Premier, in the sense that he felt that it was necessary to have a new Ministry of Employment and Investment, where the Small Business ministry surely could have picked up and carried on with some of its programs and perhaps enhanced the programs that were in existence.

My concern, of course, was to deal with the small business issue. Certainly Employment and Investment is important, but if you're pulling the programs that were initiated through the Small Business ministry and putting them with this other superministry to deal with, then the small business sector does feel forgotten. As an advocate for small businesses and their concerns, I think this ministry should be listening to those people.

The closure of the regional economic development offices has been a major concern. I have spoken to a number of the officers, and they felt that their importance has been forgotten. They get a number of calls, walk-ins and queries not just from throughout the province but from other parts of the country and in fact the world.

In the decision to close these offices -- and I'm not suggesting that a cheque was supposed to have been written just to satisfy the existence of these offices -- surely the minister would have done some measurement, some evaluation, to have some report to see the value of these offices and to see whether or not they should have continued and should have remained before the decision was made to close them.

I'm sure she has made those inquiries. I would like to know if the minister can share with us just what kinds of inquiries were made before those offices were closed.

Hon. J. Pullinger: As we did the downsizing, we did not do a written report on every issue and every program. We did, however, look at them very, very closely and see what other services were offered.

The program that the member is concerned about is essentially a program where we sent money to regional development offices. As I say, some of them are very effective; others, by their own admission, said that this was not a particularly effective way to do business.

[ Page 4323 ]

I would advise the member, as well, that in terms of the economic development officers in communities there is a significant amount of overlap between Community Futures, regional districts, municipal councils, etc. There is a tremendous amount of overlap -- people doing the same thing. I don't think that's a good use of public funds -- to add another layer to it. In the best of all possible worlds, one would have enough funding to make adjustments a little more slowly. Unfortunately, we don't live in the best of all possible worlds these days with the cuts being made at every level.

We have simply determined that this is a function that is done provincially in other ways, in other ministries. It's done federally, regionally, municipally. Having this ministry vacating the field and letting the other ministries of the provincial government carry on -- those who have more effective, efficient, targeted tools -- simply makes good sense.

I. Chong: What I'm going to ask the minister, then, is to be more specific and more clear on one particular issue that I'm aware of: this has to do with the elimination of the regional economic development officer who, as I understand it, is somewhere on Vancouver Island; I'm not exactly sure where. This was previously funded by the ministry. As I understand it, the officer is still in place but is now funded through Forest Renewal B.C.

Can the minister confirm that? Are there many other instances of this occurring? Has it just been a shift to Forest Renewal funding -- that they are required to pick up the slack? Or is this an entirely different function?

Hon. J. Pullinger: As I mentioned earlier, in last year's budget we had REDOs delivering Forest Renewal B.C.'s forest community economic development program on a fee-for-service basis. We had an MOU between this ministry and FRBC to deliver those programs. Obviously that's a cumbersome arrangement, so the nine people within my ministry that were delivering those services are now simply doing so directly from FRBC. That's clearer and provides more transparency to the process. In my view, that is a better way. If they are delivering FRBC services, they should be part of FRBC, not part of Small Business, Tourism and Culture. That's now where they are. There were 26 FTEs in the REDO program; nine have gone to FRBC. All of the positions are gone.

[11:30]

Hon. J. Pullinger: Which number you come up with depends on how far along you're counting. There were 20 REDO positions; the rest were all various degrees of management and administration, up to the 38. So 38 was the total number in that program. Twenty were actually REDOs. There were also some people that we call RMUs, regional management units -- people who are out in the regions on a managerial basis. So there were 20 RDOs, five RMUs and the rest were in administration or management elsewhere.

I. Chong: In this particular case, the minister was able to specify that nine went to FRBC. Can she advise me of any other way of tracking where the rest of these individuals went? I don't expect a breakdown person by person, but if there is a category of nine or ten or 12 that have been moved into specific areas, can she advise me of where they have gone?

Hon. J. Pullinger: These individuals, as with all of the individuals whose jobs became redundant through this downsizing, chose one of a variety of options. Some took voluntary severance, others have moved into other positions that are not redundant, and I'm sure some have retired. I don't have the actual breakdown on each of those individuals and what each person chose. Basically people throughout my ministry had a variety of options available to them, and they took one of them. Some of them went to other ministries; some took a retirement package; some took voluntary severance, etc. I don't have a tracking available to me right now of where each individual went or what they chose to do.

I. Chong: I was not suggesting to the minister that I wanted to know where each and every individual went; I certainly appreciate that it would be difficult to track. It's just that in this particular case, when you were able to identify that nine went right to FRBC, I wondered whether there was another subgroup that went to any other specific program. I do believe it's unfortunate that these have disappeared. As I say, a number of calls have come in -- not just through to my office. I know a number of offices throughout the province that have felt that they've been left high and dry without any economic development in their areas.

If the minister feels and suggests that economic development is now a responsibility of local government, regional government. . .

Hon. J. Pullinger: And other ministries.

I. Chong: . . .and, as the minister says, other ministries, then certainly there will be some who can accept that. To some extent I would have to agree -- and I want the minister to know this -- that local and regional governments do have a role to play. They could have worked in conjunction with the provincial ministry to ensure that these would continue and that a reduction of funding, if that were the case, would be done in some small way.

The whole idea of governance and what the public perception of it is, is that the provincial government is usually the initiator and inventor, if you will, of programs. They're the ones that suggest that there should be economic development in partnership with local governments and the private sector. This is why the P3s have become so very popular. Clearly, when an area feels that the ministry no longer plays a role, that definitely has an impact, because sometimes local and regional governments just cannot pick up that slack, especially as the local government grants cutbacks have just occurred.

If there's no room for regional economic development, then they feel that it falls entirely on the shoulders of the private sector. Of course, that negates the importance that is placed on the P3s. So I do understand that regional and local governments will continue to be involved, but they will be involved only in those areas that have the ability to sustain that. Those areas that do not will, I feel, certainly lose that regional economic activity that is necessary. I would ask that the minister ensure that the various other ministries that she's aware of have some economic development initiatives in place to help those areas that will now suffer very much for.

[ Page 4324 ]

The northern tour is a wonderful idea. That is one thing that we on this side of the House certainly have advocated. As the minister is probably well aware, a number of us on this side of the House went up to the northern interior regions to listen and find out just exactly what was going on. We did not go up there with an idea to suggest how economic development should be occurring; rather, we went up there with a view to listen to those businesses that have been, in their view, neglected for some time.

With that, if the minister wishes to comment, I will allow her to do so. If not, then I will move on to another area. I see the minister shaking her head, so at this point I will move on.

The minister mentioned in her earlier response things that her ministry was doing -- programs, etc. I just wanted to quickly mention some things that I jotted down. I found it particularly interesting when the minister talked about the two-year tax holiday and the 10 percent tax cut. I'll be fair to the minister. I did mention this last year to the Minister of Small Business, and certainly he and I disagreed on the 10 percent tax cut, which represents a 1 percent taxation rate of the 10 percent taxation rate that was allowed for small businesses. In fact, it was in 1992 that taxation for small businesses rose. It was when this government was elected for the first time that the small business rate went up. I was glad to see it go down, but I did not, in my view -- and it will be a difference of opinion and philosophy -- agree that it was a tax cut. It was a return to where they were prior to this government being elected.

The two-year tax holiday for small businesses, on the other hand, I will most likely, as the minister suggests, canvass in the Ministry of Finance, because I believe that's where it belongs. I wonder how $29 million dollars is tracked. We know very well that in the first two years small businesses make very little in profits anyway, and often they create losses which they carry forward for seven years. As the minister is well aware, I've done a lot of tax returns in my lifetime, and some for small businesses. I do see that there are very few small businesses that are able to report a profit. . . . When I consult with small businesses, I tell them to expect a five-year plan and a five-year payback. I will be canvassing that a little further.

I want to advise the minister as well on her comment that we should applaud government when government does take some direct approach to cutting costs and increasing efficiency. I will state for the record that I do applaud the government when it does those things, but when I do not feel that it has done so effectively, then I will raise those issues. By no means do I want the minister to feel that she is solely responsible for some of these cuts. I know that efficiencies had to be found when the budget fiasco occurred.

I want to assure the minister that we would have looked to this government to look for areas of savings wherever possible. But services to the small business sector was key. We continue to suggest that services to small businesses are key and hope that in their efficiencies they have not created more red tape, more regulations, for small businesses to encounter and deal with. I just want to have those comments on the record in response to the minister's earlier comments.

I want now to move on to some other questions I have regarding the spending estimates, in particular some of the reductions I have seen. I see a very small amount in asset acquisition. There is a decline of some $226,000 in the budget this year from last year. I'm sure it's very small items, probably amounting to a number of desks and office furniture. Can the minister advise whether there is any significant asset acquisition that has declined this year from last year that we should be aware of?

Hon. J. Pullinger: First, I want to respond to some of the comments the member has made. Quite frankly, I am surprised. You know, we have heard every single member on the benches opposite stand up, one after the other, and complain about every single reduction this government has made -- every single one. Not only that, we hear them stand up day after day demanding more money for health, more money for education, more money for their ridings: "Don't close my government agent offices; don't eliminate duplicate services." We hear it day after day, and then they do a quick turnaround and say: "You should cut the cost and size of government." You can't have it both ways.

We have seen the federal government cut 40 percent out of health care. We made a commitment to protect health and education, and we've done that. We've cut $750 million out of government spending this year. We've done it in the most effective and efficient way possible, and that includes eliminating services which are duplicated, no longer effective or can be provided elsewhere, which is what we have been talking about for the entire morning -- alternative ways to deliver these services or gain access to them.

It would seem to me that in the reductions we've made -- and while it is never fun to make reductions, or at least we on this side of the House don't like it -- we have moved heaven and earth to try not to damage people and their families, the workers who have provided good service. We have also worked very, very hard to inconvenience the public as little as possible as services are changed or withdrawn. As I say, I applaud my staff for the work they have done. I think they have done it with a remarkably small degree of disruption. I know that we are now poised to move ahead under new circumstances, move into a new century of different economic and social conditions.

We're responding to the needs of the business community. They said to do three things. First, deal with debts and deficits. We've taken the Socred $2.4 billion debt and got it down over the last four or five years to less than 1 percent, and it will be gone soon. We still have the lowest debt in the country. We have the lowest cost of government per capita in the country; we have the leanest bureaucracy in the country. So we're dealing with those issues.

The second thing the small business community said is to cut red tape. Well, we've entered into a partnership with the federal government where you can get 24-hour fax-back service. You can phone in and get business advice. You can get on the end of a computer terminal in Nelson, in Nanaimo or in the north and do one-stop business registration. Something that used to take two months now takes two weeks. If that's not cutting red tape, I don't know what is. You can also fire up a computer anywhere in the province and get direct access to Interactive Business Planner. If that's not cutting red tape and helping small business, I don't know what is.

[11:45]

[ Page 4325 ]

The fact is that we've reduced taxes on small business by 10 percent in not this budget but the last budget, and we have provided a tax holiday for new small businesses, which, as I say, affected probably 2,000 small businesses. We also provide a fabulous service -- the You-BET -- which is teaching young people how to be entrepreneurs or cooperators. That program has been oversubscribed. It's extremely popular, and it's providing good service to the community and to the business community.

I see that our time is running out and that the Chair is getting anxious for lunch. I would move the committee rise, report progress and ask leave to sit again.

Motion approved.

The committee rose at 11:46 a.m.

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