[ Page 4671 ]

The House resumed at 6:35 p.m.

[The Speaker in the chair.]

Hon. A. Petter: In Committee A, I call Committee of Supply for the purpose of debating the Ministry of Human Resources, and in the Legislature, Committee of Supply for the purpose of debating the Ministry of Finance.

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

ESTIMATES: MINISTRY OF FINANCE AND
CORPORATE RELATIONS AND
MINISTRY RESPONSIBLE FOR
INTERGOVERNMENTAL RELATIONS
(continued)

On vote 31: minister's office, $348,000 (continued).

D. Jarvis: Back to the minister again, in regard to our discussion prior to the short 35-minute recess. We were talking at that time about the number of claims that are being litigated and why, etc., etc. I was also trying to find out if the minister could tell me a couple of things on the cost of legal services, both in and out, and how they ascertain -- if they do -- how much legal services were paid to the lawyers. Or is that based on calculating back from taxes?

Hon. A. Petter: I understand that the amount paid directly by ICBC for counsel is close to $50 million. The remainder of the amount I referred to earlier -- something in excess of $200 million -- was made as an estimate by KPMG during the course of their review, based upon analysis of the number of claimants who were represented by counsel -- analysis based upon projections and assessments of the fee arrangements. From that, an estimate was then derived that extrapolated the amount of settlements and settlement costs that in fact went to cover legal fees, and that amount was then part and parcel of the costs identified by KPMG.

D. Jarvis: Can the minister tell us if that $50 million is over and above your in-house legal department?

Hon. A. Petter: It includes the in-house counsel, which would account for about $7.5 million of the total.

D. Jarvis: I wonder if the minister could give me the cost to ICBC for medical experts and non-medical experts or witnesses for claims settlements.

Hon. A. Petter: I don't have the specific numbers. There has been a chart published by ICBC which the member may be aware of. It breaks down the injury payments by ICBC and how much is apportioned to medical and legal costs, based upon the KPMG analysis. That analysis tends to show that total medical costs were some 16 percent of injury payments and legal costs some 17.9 percent. If the member wants a more specific dollar-amount analysis, again, I'll try to provide that to him from the information I receive from ICBC. But we don't have that broken down in that way, in a way that I can make available to him this evening.

D. Jarvis: I wonder if the minister can tell me if they have the information in regards to how many cases went to trial in which the awards were significantly more than what ICBC had offered to the claimants ahead of time. Is that information kept?

Hon. A. Petter: We don't have statistics broken down according to that comparison.

D. Jarvis: Could the minister possibly tell us if anyone has tried to measure, or is there any method to measure, the cost of failure to be able to settle it -- where your insurance adjusters and your legal department are unable to settle a claim -- and it goes into the hands of an independent lawyer who takes you to court, etc.?

Hon. A. Petter: Well, ICBC is always trying to ascertain the most efficient way of resolving claims. But the member is asking for information that's very hard to provide in a way that gives a certain answer because you've got to make suppositions about the impact of a settlement on other claims to know whether in fact the settlement would have effected a better result had it gone the other way. Also, claims are often resolved as late as the day before trial. Some claims may be resolved well ahead of that; others may be resolved during the course of a trial as facts become disclosed. So it's pretty difficult to break it down in some kind of way that provides certain analytical answers.

D. Jarvis: Does the in-house legal department follow claims right from the start? In other words, if a claim is reported and the insurance adjuster is doing the preliminary investigation, is the legal department aware of what's going on right away at that point? Or is there a certain point at which they become involved?

[6:45]

D. Jarvis: Has the minister given any considerable thought to having independent adjusters, rather than the in-house adjusters, take on claims right from the very start? It doesn't seem to be. . . . You know, we're talking about incentive here. As I mentioned to you, probably earlier in the year, my own family -- my daughter and granddaughter -- were hit broadside by a car, and it was over a week before an insurance adjuster ever contacted them. So I was wondering. . . . From my experience in the past, when I was an independent insurance adjuster, that would never have happened. I'm not going to say that I would have been on top of them like a wet blanket, but I certainly would have made a preliminary contact with them. Sometimes I feel, and a lot of people have said, that using independents is perhaps the better way of going about it, rather than having that conflict right away between ICBC and the claimant.

Hon. A. Petter: Well, I think the member is perhaps trading on the term "independent" to an extent. Yes, independent adjusters are used by ICBC; they're independent in the 

[ Page 4672 ]

sense that they are contractors. But of course, once ICBC retains an independent adjuster, that adjuster becomes charged with the responsibility of acting on behalf of ICBC and representing ICBC's interest. The adjuster does not act as some kind of arbitrator or independent decision-maker. Therefore their role is still to protect the interests that an ICBC adjuster would protect -- namely, the interests of the party who is being sued and those of the public in terms of resolving the claim in a way that protects ICBC's interest.

D. Jarvis: I appreciate what you're saying there, but I'm referring to. . . . Well, let me put it this way: it's the service that is provided by ICBC and their in-house adjusters that I'm questioning. Are there any standards of service or benchmarks that they have to have other than saying: "Go out and do a good job"? How are they measured? I'll back off of that just by way of saying, as I said before, that if someone is injured in an accident or has an accident, it's a natural tendency to think that ICBC is who they're up against. Sometimes -- I would think in the majority of cases -- it's better to have someone independent interfering and doing the negotiating than having ICBC and the claimant meeting head-on.

Hon. A. Petter: I think perhaps the member misunderstands the role of ICBC or maybe hasn't taken sufficient account of it in this case. ICBC is representing the interests of the party that is being sued, which is to say the party that is alleged to be at fault and to have caused the injury. That's what liability insurance, of course, does. It protects people against their liability, which results under our tort system from their fault. ICBC cannot abrogate its responsibility to represent the insured by turning over the decision to some independent party. It has to defend, vigorously but fairly, the interests of the insured party against suit.

ICBC can agree on behalf of the party to try to resolve the matter through mediation and through less confrontational means. Indeed, the moves towards mediation that were piloted in the Kingsway experiment, and which are now part of the legislative package on a broader basis that is before the House, are evidence of that. But I don't think it's reasonable to expect that ICBC could or would, under our current insurance system, forgo its primary role, which is to protect the insured party -- namely, the party that is alleged to be liable -- in favour of some kind of mediative intermediary role, which would be inconsistent with its representation on behalf of the party whose insurance it provides.

D. Jarvis: I don't intend to get into an argument with the minister on this, Madam Chair. But if he and I were both insured with ICBC -- which, hopefully, we are -- and we'd both been involved in an accident, regardless of where the liability lay, which we wouldn't know at the time of the accident, there'd be nothing to preclude ICBC from putting out an independent adjuster to look after each insured's interest. You know, that's done all the time.

In any event, I want to ask the minister a couple of other questions that don't necessarily pertain to that subject alone. Have you ever thought of pay-by-kilometre as a. . . ? This is a kind of wild proposal that would suggest to the insurers that the less they travel, the less their insurance would be.

Hon. A. Petter: It has been proposed from time to time, for example, that ICBC, instead of collecting premiums as they do now, collect a portion or all of their compensation in the form of, say, some tax collected through gasoline. Of course, that presupposes that the fairest and most important determinant of driving-record insurance risk is the number of miles or kilometres travelled. It also would have, obviously, a punitive or negative impact, let us say, on people like commercial travellers who travel a great distance or on people in rural areas who travel great distances. One would want to think pretty carefully about the policy implications of that. But it's clearly an issue that has been debated and considered from time to time and, I'm sure, will continue to be considered from time to time.

D. Jarvis: Again to the minister, if you would, I want to get into photo radar -- just not too heavily, but that's always a question, as you know. Photo radar is something that's on everyone's mind nowadays. I'm not going to get into some of the philosophy on it.

But I want to know what the difference is between an RCMP officer giving a ticket through a camera versus handing it to you through the window -- if there is any question of legality to it. At one time we understood that the RCMP have to sign the tickets they give through photo radar. Then there was a question out there that this was not the valid situation -- when the ticket arrived in the mail for you, it wouldn't become valid. . . . Can the minister clarify that for us?

Hon. A. Petter: Rather than try to. . . . The question of photo radar enforcement is properly a matter that's within the responsibility of the Attorney General. The kinds of issues the member is raising concerning service and the legal consequences and difficulties associated with one form of enforcement versus another I will leave, as I should, to the Attorney General to clarify for the member.

D. Jarvis: Right. I want to know, then, about the service of the ticket itself. I've heard that this is done by contract. So how do you go about obtaining the contract services for the processors that serve the tickets?

A second question to that would be. . . . We have received reports. . . . I'll sit down and let you talk about that.

Hon. A. Petter: I think I'll give the same answer again. ICBC's role is to provide some assistance in terms of support -- resources for photo radar. But the responsibility for its enforcement, including service and the manner of that service through contractors or non-contractors, is part of the enforcement mechanism in terms of ensuring that the law is complied with. That really is the responsibility of the Attorney General. I don't want to, nor would it be appropriate for me to, trench on those areas.

D. Jarvis: I want to ask the minister about something with regard to an article pertaining to courtesy cars that I read in the paper in early April. The corporation had offered to pay the repair shops a higher cost to repair the car, giving them incentive -- whether it be 50 cents an hour more on the labour rate or something along that line -- providing that they gave a courtesy car at no service. . . . Basically, as policyholders we're going to have to pay for that extra service. Also, the private insurers had already made a move towards this system and had made arrangements with the body shops. The fact that ICBC stepped in and upset the applecart. . . . I was wondering if the minister could explain something along that line.

Hon. A. Petter: I think the member is referring to a pilot project that ICBC has undertaken. The member is right, some of the private insurers have followed this practice as a cost-saving measure. I think what's being tested here is the 

[ Page 4673 ]

assumption that it may be cheaper and more efficient for ICBC to essentially have the body shop take on the responsibility of providing courtesy cars or substitute cars. That relieves ICBC of some of the administrative costs and makes it less costly for them to provide coverage for those cars. They then compensate through a higher rate to the body shops, in recognition of the body shops taking on this additional service.

D. Jarvis: Has the minister or ICBC given any consideration now. . . ? Are they planning to have motor vehicle inspections like we used to have prior to this present government coming in? It was taken out about the mid-eighties, I guess, by the Socreds.

Hon. A. Petter: If the member is referring to the kind of regime that used to exist years ago in which there was a sort of annual mechanical testing beyond the kind of AirCare. . .that is not being actively considered right now. But I guess what I'd say is that if, in our constant and vigilant determination to keep costs down, it became apparent that mechanical failure was an increasing contributing factor to accidents and that such testing would assist, then that might be an issue worthy of further consideration. But it's not being actively pursued at this time.

D. Jarvis: What percentage does mechanical failure have, if the records are. . . ? Where does mechanical failure come in with regard to accidents?

Hon. A. Petter: I don't have a precise number. It's very small -- in the order of something like 1 or less than 1 percent of motor vehicle accidents. As I said earlier, the major contributing factor for motor vehicle accidents is driver error.

[7:00]

Hon. A. Petter: I guess this is a bit of a circular argument. I suppose if there were mechanical testing, yes, it would reduce the potential for mechanical error or mechanical failure. But all the evidence suggests it's a very small contributing factor. Every accident, obviously, is investigated. Where something in particular, such as liability, would turn on the question of whether it was mechanical versus driver error, that particular issue would be examined particularly closely, but it would be investigated generally. All the evidence suggests that mechanical failure -- I don't want to suggest that it's not a serious issue; any factor contributing to accidents is -- is certainly not an issue that approaches even in a small way the kind of concern that driver error does, or other factors such as impaired driving, which is a subcategory of driver error.

D. Jarvis: We had a fairly lengthy discussion last year revolving around cherry-picking or creaming by independent companies on the tin end of the insurance industry in British Columbia. There was a concern that they were eating into ICBC to a certain degree -- although what's 10 percent of your total property damage, or your non-compulsory end of it? Have you given it any thought? The basic answer is for ICBC to get out of the tin and stay in the compulsory end; put the non-compulsory out to the privates, who feel that they can drive a better rate for the consumers in this province. Has the minister or ICBC given any more thought to what they intend to do with this continuing creaming of the market?

Hon. A. Petter: Well, ICBC continues to maintain a strong market share, something like over 90 percent, in the competitive market. We did have a discussion last year, and I remain concerned on two factors. The private insurers may be free riders on the traffic safety side. In other words, investments made by ICBC which reduce accidents will produce savings for private insurers who don't contribute. That's one concern. In Doug Allen's report to government, he suggested that there be some levy or some way of private insurers contributing to that pool. We have not acted on that, but I think it is an issue that's worthy of further consideration. I think one of the members asked earlier about other issues that might be looked at. I think that's one that's worth monitoring and considering.

The other is the one we discussed last year, and that is: are private insurers creaming -- are they determining their rate structure, the insurance they provide -- in a way that in effect undermines the insurance pool and the spread of risk, the allocation of risk? I guess the feeling at this stage is that while there are concerns, and while I share those concerns that that could happen, rather than try to regulate a solution at this time, particularly as we come out of the rate freeze and look at ways of responding through rate restructuring, ICBC may well be able to ensure a level playing field simply by responding through its own rating structure and modifications. But again, it's an issue that I think is worth monitoring. If it looks like we're starting to see rating structures that go beyond simply apportioning risk to what I would say is discriminating in invidious ways amongst drivers, and creaming, then I think further action might well be contemplated. We know that some private insurers, for example, are only insuring certain areas of the province, or only certain age categories of drivers. If that starts to become a problem, then, as I said last year, I certainly reserve the right to take action. But at this time it's not of sufficient concern that it merits a regulatory response. I think we'll continue to monitor it, respond through ICBC's own rating structures, and see where it goes.

D. Jarvis: So the minister isn't prepared to nationalize independent private companies at this point. I see the minister raising his eyebrows and shaking his head, so I assume that we don't have to worry about that in the near future.

I've been trying to get this information from ICBC by mail and telephone and all the rest of it, and I'm having difficulty getting to it. I'm trying to ascertain, for my own information and just to understand what's going on here with regard to the increase of losses and all the rest of it, how you break down your bodily injury losses in dollar increments. If you have a thousand loss injuries, how many are from zero to $10,000, how many are from $10,000 to $20,000, and how many are. . . ? You've got to have the information in there. I'm wondering why we can't be afforded information as to where the breakdown is -- how many claims are in the $10,000 range, how many are in the $50,000 range, and how many, say, are over $80,000 and $100,000.

Hon. A. Petter: I'll be happy to try to get that breakdown for the member. I wasn't aware he was having that problem. 

[ Page 4674 ]

Over $200,000 there might be a concern, because of the competitive nature of the liability insurance beyond $200,000, but I take it that the member's not concerned so much with that end. He's concerned with the other end -- the first $10,000, $20,000, that kind of thing; the non-competitive side of the market, the liability and bodily injury side. I'll ask ICBC to break that out and provide it to the member.

D. Jarvis: If you don't mind, I'll turn it over to the member for. . .oh, somewhere up in the Okanagan.

The Chair: I recognize the member for Okanagan-Penticton.

R. Thorpe: I just have a few questions. Could the minister advise how many brokers ICBC has working with them today?

Hon. A. Petter: Approximately 900, hon. Chair.

R. Thorpe: In moving forward in this year's business plan, can the minister confirm that it is the intention of the Insurance Corporation to maintain that level of brokers through this fiscal plan, or are there some other plans in that area?

Hon. A. Petter: No, I don't think I can confirm it in quite the way the member asks me to. But I can say this: there was a plan -- I think the member's aware of it in the question he's asking -- worked out with the insurance brokers to reduce the number of brokers to something like 600. It became apparent that there were difficulties in terms of some of the concerns of some brokers and also credit unions in respect of that target. There are still cost concerns that ICBC has in terms of making sure the brokerage system is run as efficiently and as effectively as possible while maintaining the use of independent brokers, who are very useful ambassadors and agents on behalf of ICBC.

What ICBC is now doing is undertaking a different and further round of consultation with brokers and credit unions, to look at how we achieve cost savings in a way that can be implemented with a wide measure of support. How that will come out, what will result from that, whether it entails a reduction in the number of brokers or some other strategy to contain costs, I just can't foreshadow. What I can say is that it will be a process in which there is involvement from the brokers and from the credit unions, and we will try to ensure that the savings which, hopefully, can be achieved through this process are ones that achieve the maximum level of support from those who have a direct interest in this issue.

R. Thorpe: Thank you to the minister for that answer.

I wonder if the minister could advise, on the original planned reduction of 300 brokers, what the savings were projected to be for the corporation?

Hon. A. Petter: There were short-term savings which were not substantial, but the real hope here was to set up a brokerage network that could result in service improvements through a more limited group of brokers dealing with a sort of larger customer base per broker that could achieve further savings. In the short term, the savings contemplated were not great -- something in the range of $3 million. The hope was that through a rationalization of the brokerage network there could then be, at less cost, the implementation of further cost-saving measures and strategies that might be more difficult to implement with the larger and more varied brokerage network that now exists.

R. Thorpe: Could the minister quantify, say in a five-year time horizon, what the longer-term savings were projected to be?

Hon. A. Petter: No, I can't provide a definitive number. It's partly because what was being gained here was not just savings in terms of the current baseline but savings against the possible erosion of ICBC business to private insurers who, for example, in one case are providing insurance over the phone. There is the concern that if customers started to look for different ways of obtaining insurance coverage, and ICBC was not able to respond to those different ways -- and to do so in a way that was consistent with its arrangements with its brokers -- that could erode the ability of ICBC to remain competitive in the competitive side of the market.

It's difficult to quantify savings, and I don't believe there was a specific quantification. It was more a question of trying to come up with a more manageable, more rational brokerage network that could assist ICBC in maintaining its marketing capacity and meeting the changing demands of the marketplace in the face of increased competition.

[7:15]

If the minister can't quantify that number tonight with the ICBC executives here, I'm just wondering if he could tell me. . . . There must have been a comprehensive study done on this. I wonder if he could also answer that question.

Hon. A. Petter: As I understand it -- and this is not a field of my expertise, either -- the effort here was to work in concert with the brokers in terms of trying to improve the service delivery that ICBC provides. This was to be an ongoing collaboration, taken a step at a time, with the business case and the analysis to build from that relationship. There was mutual agreement that the kinds of pressures that were being faced in terms of competition and customer demand would be easier to respond to. And there was agreement -- at least, at one point there appeared to be agreement -- that that could be better achieved through a more consolidated approach to using brokers. The next steps were to build on that smaller number of brokers to then target additional changes that would be more manageable within that smaller range. The business case would essentially evolve from that relationship.

This wasn't a case of ICBC coming up with a business plan, going to the table and saying: "Here it all is." It was a case of ICBC sitting down in collaboration with the brokers, saying: "Here are some things we need to contemplate. Let's work together."

The one thing that was agreed to, it appeared initially, was that an initial step, which would assist in subsequent 

[ Page 4675 ]

steps and in developing the very plan the member's talking about, would be some consolidation. As it turns out, that proved to be a more controversial, contentious matter than was at first thought. So ICBC is now taking a step back. But the same commitment to work consultatively with brokers -- and with credit unions, in particular -- to develop that plan remains.

R. Thorpe: As I heard the minister say earlier today with respect to replacement parts, he's not an expert on replacement parts, but he certainly scratched the back of his head and wondered why we would be paying above market value for replacement parts. The minister seems to be able to understand that common sense should prevail in that situation.

Before I go back to that line of questioning, I'm wondering if, with the executives from ICBC with him, the minister could tell me: out of the 300 agents who were going to be terminated out of the process, how many employees, on average, did each one of those broker's offices have?

Hon. A. Petter: No, I don't have those numbers. The reason is, as I understand it, that this was part of a four-year agreement with the brokers. The 600 was an estimate, but the next step was going to be to identify certain criteria for qualification for brokers, and then, coming out of that qualification, some brokers would either qualify or not qualify, and the numbers would fall out of that process. It wasn't as though there were 300 known brokers who had been targeted and therefore one could quantify it.

The internal costs of ICBC dealing with brokers are, as I understand it, in the range of $33 million. As I said, this was a common commitment that was made, to work between brokers and ICBC, to try to reduce those costs or at least prevent those costs from increasing. It has not proceeded in that direction, in any event, and now the corporation has undertaken further discussions with the brokers and with the credit unions.

R. Thorpe: Thanks to the minister. I thought I heard the minister say -- and I'd just like it clarified -- that the 600 number was not a known number. Is that what the minister said?

Hon. A. Petter: As I understand it, the 600 was an estimate of where the corporation would have ended up with respect to its brokers should that agreement have proceeded. It might have been 600-plus or 600-minus, but that was the estimate.

The other fact I should introduce here is that part of this was to achieve efficiencies through some consolidation. Therefore the expectation was that if some of the smaller outlets cease to provide insurance on behalf of ICBC, some of the employees that might have been providing that insurance would then likely shift over and be given employment within other operations. That's another reason why it's difficult to quantify the numbers.

R. Thorpe: Well, I'm rather puzzled, because I do have a copy of page 52 of the "Automobile Insurance Review," which I assume the executives from ICBC have. It does say here that there's a cap on the number of brokers allowed to sell ICBC insurance. The corporation is proposing to reduce that number of authorized brokers by 300. Now, I thought our starting point was 900. So 900 minus 300 gets us, amazingly enough, to 600. It seems rather strange to me that a multibillion-dollar corporation is taking what appear to be shots in the dark with 300 brokers who, I'm led to believe, have on average between three and four employees -- so let's say 3.5. That's in excess of 1,000 employees to save $3 million, when this minister has said that they had no known savings going forward. This is the same government that stands up in this House and tells us it's jobs, jobs, jobs, jobs, jobs.

I just wish they would tell this House the truth. I'm sorry, hon. Chair and minister, to get so excited about this, but I really thought the questions were rather straightforward, and I just wanted straight answers. I find it inexcusable that this corporation is going to let 300 brokers' offices close down -- it was completed; it was not without some consultation, but they didn't read the consultation right and people started to mobilize -- and that this corporation could appear to be so insensitive to these people.

I would just like to know how many people the corporation thought it was going to displace. The minister made a comment that they were going to be transferred somewhere -- potentially transferred to work somewhere. Where were they proposed to be transferred? I think that's new information. I don't know whether ICBC was going to absorb them, or what. But I just wish that we could deal very clearly with these issues, because we are talking about families throughout British Columbia.

Hon. A. Petter: The member is trying to find scenarios that don't exist. The fact is that ICBC entered into a consultative process with the insurance brokers. Through that process, which was to continue to unfold, a target was initially set between the two to see if the number of brokers could be reduced to a new target cap level of 600, as the member has indicated. Criteria were to be generated to determine how that would take place. The expectation was that current brokers who would no longer act as brokers. . . . Their operations would be taken over by other companies and their employees would then continue to serve the customer base, which after all has to be served. And that would minimize employment loss and result in greater administrative efficiency.

The proposal was initially supported by the brokers' association, which has been part of this consultative process, by a vote of about 58 percent, as I understand it. Notwithstanding all of that, and notwithstanding the fact that ICBC could have stood by that agreement, when there were concerns voiced by the credit unions and by others that the process had not fully taken account of concerns, ICBC did what the opposition so often says sensitive public agencies or corporations ought to do. It said: "We'll take a second look at it. We'll take a step back and we'll go back to the table." That is what happened here.

Rather than trying to find something sinister or untoward in that, I would have thought the member would want to congratulate ICBC for having thought better of the situation, particularly given the concerns as he's voiced them, and for its willingness to take a step back and to continue the work consultatively; and not sacrifice the common spirit of cooperation that was starting to build, by insisting that this first target level wasn't absolute, but rather go back and see if alternatives can be found.

R. Thorpe: As the minister knows very well, I have no problem whatsoever congratulating and applauding those who do worthwhile work and put things forward in a very thoughtful manner. However, when a billion-dollar corporation with very highly paid executives running it is going to displace 1,000 workers. . . . Sorry, I'm a cynic. If you were 

[ Page 4676 ]

moving to more advanced technology. . . . It's not job for job in the processing of claims; if it is, you should never be closing them down. Your own statement, your own documentation talks about cost savings, and we all know very well that one of the largest components in cost savings is the reduction of staff.

So I am happy that we are now reviewing this, and I would just hope that the minister -- as the minister rightly expressed this afternoon on replacement parts -- would make sure that ICBC is very, very sensitive to the needs of all British Columbians in moving forward, and that the consultative process is a meaningful consultative process. You know, when I do the quick math here, it was $3,000 an employee we were going to save. Quite frankly, when I see administration of $84 million and what my colleague from Kamloops-North Thompson disclosed on replacement costs, I think we could do a better job of looking inside the corporation. So I would just ask the minister, if he is going to direct the executive of ICBC to have a much more meaningful and sensitive approach as they go forward in the consultative process, that while they have taken the initiative to take a second look at it, they in fact cost these things through -- both in financial terms for the long term and, more importantly, human terms.

Hon. A. Petter: First of all, earlier we debated ICBC's internal costs and how those compare to others. ICBC's expense ratio is about 17 percent, compared to other companies operating in Canada at about 31 percent. So ICBC's cost ratio is pretty darn good internally.

The member can spit and fume all he wants about a proposal that hasn't gone ahead, but I would say this: the reality is that private insurers in other provinces are moving very aggressively to consolidate, to form clusters amongst agencies and others, and to downsize their distribution networks. In this province we face fierce competition from private insurers who do not even provide direct service over the counter but are using phones. Now, if the member is prepared to say that ICBC should respond to that by outlawing that or by preventing private insurers, then that's one thing. But he cannot expect ICBC to be unable to respond to pressures from those in the private sector who do what members opposite seem to glorify so often, and that is to effect savings in the marketplace.

[7:30]

So it's a little bit hard to take the member's huffery and puffery around this issue, because I think ICBC's approach to this has been better evidence than anything that a public corporation can, and in this case has, acted in a markedly different and more responsible way than the way private insurers are operating in other provinces, where they are radically downsizing their approach to providing service for brokerages. ICBC has resisted doing that and has chosen to work cooperatively and will continue to choose to work cooperatively, and I'm very proud that they have taken that route.

R. Thorpe: I am going to take a little bit of exception to some of the words of the minister. This is not show, this is not puffery, this is not smoke, this is not grandstanding, as the minister alludes. . . .

An Hon. Member: It's about people's lives.

R. Thorpe: Thank you. That's exactly what it is.

I know the minister has great responsibilities; I understand that. But someday I hope he has the opportunity, as I have had, to visit small agencies throughout British Columbia and to listen to people, listen in some of those small communities. I understand that one of your roles is to be supportive of your executive while they're here; I understand that. But I think it's been clearly demonstrated here tonight that, yes, there was an agreement in the beginning, albeit obviously a very frail agreement that did not stand the test of time and the test of the facts getting out.

Again, I didn't get a commitment from the minister that they are going to look. . . . What they should be doing. . . . You know, comparing 17 percent and 31 percent. . . . I don't think you can just take ratios here. I don't know if there's an industry standard, if all companies' financial statements are produced the same way. But I think this corporation should be looking inside itself, and after it gets its inside costs honed down and is as efficient as it possibly can be, then it should be moving out. . . . It would be moving in leadership out to the other parts of the business, knowing very, very well that it has accomplished all it can accomplish.

D. Jarvis: Well, I congratulate ICBC -- or the ministry, I guess it would be -- for backing away from that agreement with the insurance brokers of British Columbia.

I've got to editorialize on that aspect, because I don't think it was a step-at-a-time approach that they were trying to take. It may have been a step at a time, as the minister said, but ICBC was hedging their bets through the government. The ministry was opening up a three-year window in which, in the event that no-fault didn't work, eventually they were going to go to a direct-writing campaign themselves. This was the precursor to it. And all those people -- the great conspiracy out there -- probably would have ended up working for the motor vehicle branch in unionized jobs.

In any event, when the minister mentions the fact of the brokers qualifying, that he may have to look at it and see whether they qualify, did the minister mean that he would make them more accountable?

Hon. A. Petter: No. What I was referring to was the fact that there had been agreement with the brokers to work on criteria to assist in achieving the target level. That would have related to performance. It would have related to the proximity of brokers as between each other and other variables that would have ensured that the reduction would have taken place in a way that achieved the objectives without compromising service.

My response to the previous member really reflects my frustration with the fact that the previous member apparently neglects to acknowledge what I've said throughout this: that ICBC's concern throughout has been to protect employees, to achieve savings in a consultative way. Indeed, with reference to the huffery and puffery -- I'll use the term again -- about the small communities, small communities would have been largely insulated from the effects of this reduction. It would have had greater impact within larger communities, where 

[ Page 4677 ]

there is greater potential to achieve reductions without compromising service and in which there could have been consolidation of brokerage underwriting, which employees could have shifted over to.

Back to the member's question, the criteria would have related to both performance criteria and criteria concerning the spatial distribution of brokers, service standards, etc. That, of course, was the subject of further discussions that now may not take place with the brokers' community.

D. Jarvis: I've only got a few questions left to ask, minister. Perhaps I could read one out, for example, and you could advise me, or staff could look at Hansard. This is on claims investigation. How many claims during the last year were assigned to private or independent insurance adjusters? How many private investigators are there? Are there any on staff or do you assign. . . ? All independent? How many referrals did you give to them? How many claims files, if any, did you turn over to lawyers outside of your offices or outside of ICBC offices? The same with claim files from independent adjusters: how many adjusted claims to lawyers and from ICBC examiners to the lawyers -- and how do they do that?

Also, we got into photo radar. The minister didn't feel as though I should be asking him those questions on photo radar. I want to know. . . . There was one aspect in there about theft and fraud and all the rest of it, and there was the ICBC CIU. I guess the police were referring to. . . . I assume that means criminal investigation unit or something like that. Does ICBC. . . ?

Interjection.

D. Jarvis: Special? Oh, it's SIU. Does ICBC have staff, and if so, can you tell me how many staff they have?

Hon. A. Petter: With respect to the matters that the member canvassed in the first part of his question and which we talked about in the House, yes, staff have taken note of those matters. We'll try to provide the member with information concerning those statistics that he was looking for.

If the member is referring to the special investigations unit within ICBC, there is such a unit, as I understand it, that looks at claims and investigates them. The information that it gains in those investigations -- should it lead to any evidence of, say, criminal activity or something that might lead to charges -- would then be turned over to police for appropriate charging and other activity. But there is such a unit within ICBC, yes.

D. Jarvis: I'll leave on this, but I'm going to ask about four questions here given to me by an associate. I wonder if the minister could advise us, in writing if necessary -- or maybe he wants to reply directly; the onus would be on him. . . . How many ICBC employees have subsidized vehicles, leased or otherwise, for personal use? The second question would be: what make, model and year are they, and could he provide a list? Three: what is the maximum annual vacation and paid-time-off allowance for an ICBC manager? I've never been a manager, so I'm asking these questions. What benefits other than salaries, vehicles in some cases, and employee benefits packages similar to what union employees enjoy do any ICBC managers receive -- i.e., health clubs, travel programs and sabbaticals? If the minister doesn't wish to. . . .

Hon. A. Petter: I'll provide the few answers that I can quickly provide, and then we'll try to fill in the gaps for this member's benefit in due course.

My understanding is that there are no special health club benefits of any kind. Maximum vacation time, I think, would be six weeks. The number of leased vehicles, I believe, is 21 at the present time. I'll be happy to provide or have staff provide the additional details regarding that to the member in writing.

D. Jarvis: That's all the questions I have right at this time. I thank the minister for his cooperation and his staff's cooperation. I hope that he will respond to me quickly on those questions that I asked him to respond to. That would be appreciated.

The Chair: Shall vote 31 pass?

F. Gingell: Is this a separate vote or are you talking about the Finance vote?

Hon. A. Petter: You want to be on your feet.

F. Gingell: Yeah, I need to be on my feet.

Hon. Chair, I would suggest a four-minute recess while the minister gets his new people and ensures that he's in a position to respond. We are moving to the government services. . . ?

The Chair: All right, hon. members, we'll take a four-minute recess.

The House recessed from 7:42 p.m. to 7:46 p.m.

[I. Waddell in the chair.]

Hon. A. Petter: I'm very pleased to be joined again by some Finance staff for this part of the estimates debate. I'll reintroduce Gerry Armstrong, who's deputy minister, and Brian Mann, who's director of the finance administration branch. Also joining me for the first time during the course of these estimates is Bob de Faye, who is assistant deputy minister and chief executive officer of the Purchasing Commission and assistant deputy minister of government services.

P. Reitsma: Thank you to the minister and to staff. I've got a number of questions on the government services and registries. Before I start, my thanks, certainly, to staff. We've had a couple of meetings -- briefings. One was rudely interrupted because of a cellular call. We had to vote on something which, as it turned out, we lost actually, so we could have stayed there. Be that as it may, I'm very thankful for the help -- for the second time now, actually. I went to the ministry last year to ask a number of questions, and we canvassed this particular section quite extensively.

I do have a number of questions. We'll probably go about half an hour or 45 minutes. They're all anti-antagonistic; they're quite nice, as a matter of fact. I must say that I have explicit approval and the blessing of my critic to ask these questions. So that's good to know, of course, as well.

Interjection.

P. Reitsma: That being the case, the first question. . . . It used to be the Purchasing Commission, and I understand the name has been changed. Was there any particular reason for that?

Hon. A. Petter: Yes, the Purchasing Commission has in a sense been. . . . The responsibilities of the assistant deputy 

[ Page 4678 ]

minister, with respect to the Purchasing Commission, have now been broadened to include other functions that came into the Ministry of Finance with respect to registries, statistics and protocol. Those have, as part of the reorganization that has now come about subsequent to the shift of functions from Government Services into Finance, resulted in a reconfiguration and consolidation of those functions around a single ADM who is responsible for those functions in addition to the previous responsibilities held with respect to purchasing.

P. Reitsma: I'll be referring now to the briefing -- and the minister has a copy, as well -- on Ministry of Finance and Corporate Relations government services and registries program descriptions of April 1997. I'll be referring to that one for almost all of the time.

I'll go to vote 32. It's the third page after the yellow page; it's the purchasing services branch. The program description. . . . Of course, the purpose is to purchase goods and services on behalf of government ministries and to provide central supply planning for ministries and publicly funded agencies. First of all, I understand that there is a reduction there. I'm wondering how much it is compared with last year's funding, and also what the FTEs were last year and what the FTEs will be this year.

[G. Brewin in the chair.]

Hon. A. Petter: The budget cuts reflect a cut of about $284,000 -- just over a 9 percent reduction in budget. But there has been the addition of a strategic component to this branch, and therefore the FTE count has in fact gone up, as I understand it, from 44 to 47.

P. Reitsma: In terms of the program objectives, "To provide for the cost-effective purchase of goods and services on behalf of ministries and some public agencies to save money. . . ." I'll combine this one with the next one: "To ensure fairness in property and goods and services acquisition." How do you measure if it's being achieved and if it is achieving what the government set out to do?

Hon. A. Petter: There is a range of accountability measures involving a range of tools. I won't go through them all, but monthly business reports produced by the branch would include: performance statistics and comments derived from customer surveys -- up to a 10 percent sampling; business volumes from the central purchasing system, including the number of transactions, regional spending patterns and savings; and narrative details of significant events occurring in the reported month. So there is a very comprehensive and concerted set of measures that are in place to measure accountability and to ensure performance is met in respect of the program objectives referred to by the member.

P. Reitsma: The third point is to create market access for B.C. suppliers, which is good. Could the minister advise the House if any non-B.C. suppliers are involved? Is there any marketing created towards non-B.C. suppliers, particularly those that can perhaps deliver a particular project that the government is looking for?

Hon. A. Petter: Because there is open tendering and because suppliers outside British Columbia are able to compete in those open tendering processes, there are certainly suppliers who are non-British Columbian. Having said that, about 84 percent of suppliers, as I understand it, are British Columbian, and I have asked the branch to undertake further measures to try to encourage and facilitate B.C. suppliers, wherever possible, to participate in the competitive process and to ensure that B.C. suppliers are given every opportunity, through access to the information systems, for example, and through more aggressive attempts to reach out to B.C. suppliers and to identify suppliers who might not now be competing but could compete, perhaps with slight modifications. There may be areas right now where there is a service or a good that is not being provided by anyone in B.C. and for which a B.C. supplier might, if they knew that there were opportunities, modify the products they produce to take account of that need and bid in the process.

I've asked the branch to come up with a strategic approach that will encourage, within the context of all the trade agreements and other understandings that we, of course, have to comply with. . . . B.C. suppliers are given every opportunity to compete, and in fact, B.C. suppliers may be encouraged to become competitive in areas where previously they wouldn't have thought to or wouldn't have attempted to.

P. Reitsma: A side comment on that. There is an AA system -- and I'm not talking about Alka-Seltzer Anonymous. There is an Alberta advantage. When I happened to be on the northern tour earlier this year, we talked to Alberta companies. They have something of what they call an Alberta advantage, whereby there are some advantages and preferential treatment given to Alberta companies. Do we have such a system, like a B.C. advantage or preferential treatment? I know that some of the municipalities do it in terms of, say, a 5 percent leeway or preferential treatment. Is there something? Is there a BCA, a British Columbia advantage? If so, what is it? If there is not, has the minister considered such a system perhaps?

Hon. A. Petter: I'd be intrigued to see any material that relates to this Alberta advantage system. Frankly, we're not aware of it but would be very interested in seeing it.

As I said already, we are very anxious -- and I have given very strong direction to the branch -- to maximize the opportunities, within the constraints that are necessary for fair competition and fair trade in the agreements we've reached, to ensure that we maximize the opportunities for B.C. suppliers in every way possible. In that sense, yes, we want to make sure that B.C. suppliers have the advantage of getting that special extra treatment so that they're aware of opportunities and they're encouraged to participate in a way that does not, however, contravene the market access requirements of the various agreements that the government is participating in.

If there is already something in Alberta along the same lines, then certainly I would benefit from finding out more about it. I'd be very appreciative if the member could direct me to any information he might have in that regard.

P. Reitsma: Yes, I shall do that. I was almost enamoured with it. We, for a while -- certainly when I was mayor of Parksville -- tried to give preferential treatment. There are really some inherent dangers to that, as well, because you don't want to be too preferential, I suppose. At times they did a 5 percent differential, actually.

So I do take it that there is not such a system in B.C. at the moment. Has the ministry or the minister contemplated a preferential treatment, a differential, at all? Secondly, if there is none, I would take it that through the bidding system, if an 

[ Page 4679 ]

outside-B.C. company were to come in at a lower bid, then it automatically goes to the lowest bidder, all things being equal, even if it's outside B.C.

[8:00]

P. Reitsma: The last question on this particular page is on the last objective: "To improve the cost-effective use and management of government travel budgets." I'm probably somewhat biased, because I happen to be in the travel industry with my travel agencies, actually. First of all, before I get into some details, is the government achieving what it set out to achieve in terms of the challenges, in terms of long-term goals on this particular issue?

Hon. A. Petter: There have been considerable cost savings achieved in the area of travel, particularly last year, as a result of initiatives taken by myself and Treasury Board to freeze travel expenses, to reduce travel expenses and to encourage public servants to use the least costly alternative. There have been savings as a result of those initiatives.

Beyond that, the member may be referring to. . . . The auditor general, in his report, referred to some initiatives that have been undertaken within government, within Treasury Board, to look at alternative travel management options. The Ministry of Health, for example, has a travel agency contract which is, in a sense, a pilot to test what savings can be achieved through a contract arrangement. The auditor general, of course, encouraged us to use the muscle, I guess, that government has in respect to travel to try to achieve cost savings. We would like to achieve cost savings, but obviously we have to be mindful, as well, of the impact of that on the economy and on the communities.

We are exploring some of these alternatives. There's also the American Express travel card program, which is designed to try to achieve savings. We are certainly committed to trying to achieve travel savings through a range of these kinds of initiatives, testing them as we proceed.

P. Reitsma: I take it that there is no one particular travel agency or chain that business is being done with. If so, is there. . . ? With many of the corporate accounts, there is often a return -- I wouldn't want to use the word "kickback" -- of a certain percent of the commission or the remuneration that travel agencies derive from selling travel opportunities. I'm wondering if there is a particular chain or agency that is dealt with overall and, secondly, if there is any return of commissions. Thirdly, I would like to be advised what is done with frequent flyer points and things like that. Fourthly, on travelling. . . . I appreciate that senior staff. . . . Are they permitted to take a spouse along, particularly if it is a government aircraft and if there is space?

Hon. A. Petter: Okay, let me see if I can go through the multi-parts of that question.

I think I've already indicated that Health has an agency of record, and Health does in fact achieve savings through commissions they receive and discounts they receive through using an agency of record.

Corporate accounts are indeed being encouraged, again because they can ensure that better service is provided -- and more cost-effectively provided. The travel card is being promoted as a way of minimizing the need for advances and some of the costly paperwork associated.

I would say that while corporate accounts are being encouraged, the notion of trying to use one big travel agency, for example. . . . While from a purely economic point of view, from a government cost point of view, it might be seen as a saving, it's something that is not being pursued at this time, because frankly, the government's expenditure in travel is part of an economic development strategy, as well. We want to make sure that we do not starve the small businesses who depend upon government travel, and we want to make sure there is some balance in the savings we achieve with those economic objectives.

So let me go back to the list. The travel card is being promoted, also. By the way, the use of video conferencing is being encouraged -- an estimated saving of $300,000 last year -- as an alternative to travel.

Frequent flyer points. I think the member is probably aware that government employees are not permitted to accumulate frequent flyer points for their own personal use, but they are being encouraged to accumulate such points for corporate use, for government use. There may be something more we can do to promote that, but it's certainly something that I know is done by government employees and that is encouraged because it can save us money.

In respect of spousal travel, no. My understanding is that spousal travel is not permitted under any circumstances for government travel. I should clarify that: spouses are free to travel, but what I wanted to make clear is that compensation for spousal travel is not provided under any circumstances.

P. Reitsma: All those explanations.

Before I go to the next page, just a comment. I appreciate the minister's comment in terms of chains versus individual agencies, which I'm encouraged by. Often big chains, as we know, have various muscles that smaller agencies do not have. I appreciate the sentiments in the minister's statement in terms of making sure that we don't starve out the little ones, which is good.

The only question not answered -- and maybe the minister is simply not aware of it, and that's fine. . . . Maybe it could be researched; there is no particular rush. Many of the corporate accounts, in terms of the return of commissions or the deal-making, return 2 or 3 percent of the commission, although there is now a capping on flights within Canada. . . . They return 2 to 3 percent or a fixed amount to that corporation. I appreciate the smaller details. If the minister has to look for the answer, that's fine, as long as I get his undertaking to get me an answer on that.

Hon. A. Petter: I'm sorry; I thought I had provided an answer. But to be more specific, yes, I referred to the Ministry 

[ Page 4680 ]

of Health and other agencies of government now pursuing some kinds of corporate accounts or corporate relationships, and indeed there are returns of commissions through those relationships. I understand that they may well be in the order that the member is indicating.

P. Reitsma: Turning to the next page, the vehicle management services. . . . We went into this in depth, actually, last year. My immediate question, of course, is: what is so different this year from last year? When I brought it up in the estimates last year, we were particularly looking at the outsourcing option. What is philosophically so different this year, when they're thinking of outsourcing, that they didn't want to do last year?

Hon. A. Petter: I'm tempted to say the old saying -- that it doesn't appear to appear to us now as it appeared to appear to us then -- but I won't say that. What I'll say instead is that the obvious thing that's changed is that a program review has taken place in the intervening period. As a result of that program review, it's been determined that there may well be savings to be had. Other governments have moved in this direction. There seems to be more of an entrepreneurial spirit in the land amongst companies that might provide government with vehicles and, potentially, with a management capacity with respect to those vehicles, although it's a somewhat open question as to what might be entailed in that regard. Testing of that market, and the program review, determined that there might well be significant savings to be achieved, and we are now going to test that, of course, through a competitive process.

So the passage of a year, the program review, and some of the indicators from the marketplace concerning the kinds of interest that might be forthcoming in this environment, in which companies may be more competitive and more interested in securing this kind of business than would have been the case in the past, are indicative that perhaps the savings that weren't previously thought to be there might now in fact exist. We're going to test that through a competitive process.

P. Reitsma: On that, I take it that the review is taking place at the moment but is not completed yet, and that there is some indication that there might very well be some savings. The review has not ended yet; it's taking place. There are indications that there might be some savings.

Hon. A. Petter: Well, the program review determined that there was a substantial likelihood of savings. Now, as the request for proposals is being developed, we will determine the extent to which those savings may exist. But there is good reason to believe that perhaps some of the duplication that exists amongst ministries and some of the costs associated with that could in fact be reduced through the use of a private operator. The government has retained a major consulting firm with expertise in this area to carry out a review of the current internal system of vehicle management within government. That review is assisting us in developing the evaluation process that will underlie any competitive process that takes place in the next short while.

[8:15]

Interjection.

P. Reitsma: Well, take credit where credit is, you know. We're always happy to support good ideas, particularly those originating in the opposition, I suppose.

Be that as it may, I understand that there is a cut of just over $200,000, which is about 9 percent. Are there fewer FTEs this year than last year?

Hon. A. Petter: First of all, I do recall the discussion last year in estimates and appreciate the member's suggestions. Sometimes I think there's a feeling across the House that government does not respond -- or perhaps refuses to respond -- when it corresponds with a suggestion. I want the member to know that somewhere between because of and in spite of his suggestion, we are indeed looking actively at this issue. I appreciate the fact that he raised it in the House. I think that certainly has helped to draw attention to this issue.

On the FTE question, I believe the FTEs have gone down in this area by a count of one.

P. Reitsma: My last two questions on this particular page are under "Program Objectives." Bullets 3 and 4 say: "To apply technology to reduce costs and duplication of administration, [and] to ensure vehicle-related expenditures support local economies through fair, open, competitive bidding, without compromising cost to the government." How's that going? Are we achieving some results? Is the ministry happy with that program it has undertaken? If they're happy, can it be improved? Or is it going according to the goals set out?

Hon. A. Petter: I understand that there have been considerable strides taken in respect of standard service contracts for maintenance with respect to service providers throughout the province. So that distribution network is there, and it is providing a support to local economies by doing so in an efficient, fair way. Also, through the use of gas cards and arrangements with providers, the ministry is achieving savings in respect of things like gas, parts and other associated costs through bulk buying and using the ability of government as a major customer to achieve savings through the volume that government utilizes in respect of things like gasoline.

P. Reitsma: Talking about technology, I understand that a grant was made available -- it might have been to a Victoria outfit -- to look at climate changes and meteorological changes. It's kind of good for the forecasting of forestry revenues, I suppose, because then they don't have to rely on the weather that much anymore. Anyhow, that's really just a side comment.

The next one is Government House. The program objective says: "To increase the awareness of the historical and constitutional roles of the Lieutenant-Governor and Government House" -- which I think is admirable. Could I have some indication of how that is going? Is it achieving that particular objective, which, I think, is a very important one?

Hon. A. Petter: Obviously the lead in terms of increasing awareness of the historical and constitutional roles of the Lieutenant-Governor and Government House is the 

[ Page 4681 ]

Lieutenant-Governor and his very capable staff. But we do certainly provide support to the Lieutenant-Governor and staff and will continue to do so in respect of any assistance we can provide for outreach to schools, providing public information and programming that can assist the Lieutenant-Governor in sponsoring events at Government House and any activities the Lieutenant-Governor may want to undertake or have support in undertaking in raising awareness amongst school groups, visitors and the like. The ministry does provide that assistance and will continue to do so in raising the awareness and the appreciation of the public for this extremely important constitutional function.

P. Reitsma: I appreciate the answer, because I think the customs, the heritage and the norms. . . . That's a lot of tradition, and I find it very important, as well. I understand that they may need $60,000 in recoveries because of the authentication of documents.

Going to the next page, under "Protocol and Events," the program objective is: "To provide logistic management and administrative services for senior-level government conferences and events." I can attest to that, because in 1988 we hosted the Western Premiers Conference in Parksville. Talking to the organizers, a tremendous amount of organizing and administrative work had to be done for that.

The last bullet in the program objectives is: "To process requests for the use of British Columbia in a company name and produce and distribute the official events calendar." Is there an appeal process if the protocol and events division were to say no to a request?

Hon. A. Petter: As I understand it, this issue most commonly arises with respect to requests to incorporate societies with British Columbia in the name of the society. If that happens, then the registrar of societies would seek guidance from the protocol and events component of the ministry. Based on that advice as to whether it was an appropriate use of the name, a decision would be made. The appeal process would be through the legislative provisions that govern the registration of societies through the registrar of societies, not directly through protocol and events. That typically would be the way it would happen.

P. Reitsma: Going to the next page after the next yellow one, government services and registry division, function resources is one of the few times where you see a hundredfold increase in the numbers: it's gone up from $10 to $1,000.

On the second page, under "Queen's Printer," it says: "To promote a viable printing industry in British Columbia." We went through that quite extensively last year. We talked about privatization. Is there any move towards privatization?

Secondly, on a number of pages, I guess the operation under the $10 vote will now be a $1,000 vote. There are about five pages like that.

Hon. A. Petter: First of all, I take it that the member is being somewhat facetious. The shift to the $1,000 from the $10 vote is really for convenience in totalling up and presenting the budget numbers in ways that don't involve all sorts of subnumbers. It doesn't really make a lot of difference, because these still operate as though they were $10 votes, except. . . . Oh, I suppose we'll refer to them as $10 votes, no matter what they are, it being traditional.

There is no further move towards private printing beyond what is already provided. The apportionment, as I understand it, is about 70 percent private, 30 percent through the Queen's Printer right now, and that proportion continues. So there is, right now, a preponderance of printing done in the private sector, and that is expected to continue. But I don't see much of a shift, at least in the short term, in that apportionment.

P. Reitsma: On the next page is postal and distribution services. Again, the $1,000 vote, which will be changed from $10, of course. . . . Would internal distribution provide lots of cost saving versus if Canada Post were to do it?

Hon. A. Petter: This is actually an interesting area, because it's an example of how savings were achieved by taking something back into government from the private sector. Indeed, I should say that we are, in our program review and our ongoing review of government and the work we're doing with government employees, looking both at areas in which savings can be achieved by contracting services out. . . . And we've talked about some of those areas, vehicle management services being an example. We're also reviewing areas -- and this is one where we see how it could be -- in which bringing services back into government could in fact achieve cost saving and more efficient delivery of those services without compromising quality.

I understand that a program review undertaken in this area in 1992 identified the opportunity to save government money to the tune of about $21 million in postal and distribution costs. These services were taken back from the private sector in '93-94 with documented annual savings of $130,000. It's a nice example of how contracting in can sometimes be a better solution than contracting out, and confirms my view that one does best when one approaches these issues from the point of view of evaluating the quality of the service and the cost saving, without ideological preconceptions about which model of delivery will necessarily be more efficient. Because in some cases it may be government and in some cases it may be the private sector, and we should be open to both those possibilities.

[8:30]

Hon. A. Petter: Perhaps I can provide some examples that are responsive to the member's question. One of the things that is done is to manage certain kinds of equipment, for example, that may be required by various different users and through that management to effect savings for government. So, for example, if field crews require chainsaws, if they require Zodiac boats, or if they require camping gear and equipment, that equipment is maintained by this program and provided on a basis that effects overall savings for government and reduces the cost that would otherwise arise from each and every one of those needs having to be met independently of some government agency being able to provide them.

P. Reitsma: On the last page, on the last two questions -- corporate and personal property registries -- the second-last dot on the program objectives says: "To decrease turnaround times for providing services." How is the government achieving that objective? Secondly, the $36 million of projected revenue -- where's that coming from?

[ Page 4682 ]

Hon. A. Petter: The revenues, first, refer to the fees that are collected in respect of the registration activities that are conducted by these registries. The turnaround times have, as I understand it, been improved. Not only are targets being set in respect of turnaround times but the targets are in fact posted on the web site so that users can be aware of the targets. The experience to date has been that the targets are being met or exceeded in the vast majority of cases.

P. Nettleton: A fresh face, a fresh voice and a new direction in terms of questions, if I may. As you recall, I brought up the question of registries and referred you to the 1996 business plan dealing with registries as special operating agencies. I wonder if I might ask a few questions which arise after having reviewed the business plan of '96-97.

The first question is. . . . The registries were given SOA status with the goal of improving performance delivery. I wonder if perhaps you could give me some detail as to what the experience has been now that the registries have been operating for a year as SOAs, special operating agencies.

[E. Walsh in the chair.]

Hon. A. Petter: Let me just report back in general terms. It has just been a year, so we're still drawing early conclusions. But by and large, I think the conclusions to date have been largely positive. In terms of overall performance, the registries did very well. Revenues were about 2 percent higher than the previous year's. Expenditures were $248,000 under budget, and the volume of work completed was about 2 percent higher than last year, with service turnaround times approximately the same. And all of this was accomplished with three fewer staff than in previous years. So I think the member would agree that all of those measures show some measurable and substantial improvement with respect to the performance of the registries.

P. Nettleton: The "Registries SOA: 1996-97 Business Plan," page 4, indicates that a 2.5-percent-per-year reduction in budget would, in time, affect the registries ability to deliver service. The question that I have would be: what are the plans with respect to the registry's budget? I see there's no decrease noted in '97-98. Is this trend expected to continue?

Hon. A. Petter: Well, of course, one of the advantages of setting up a special operating agency is that it does encourage one to look at trying to stabilize some of these matters. As I understand it, the management plan in this case is one that sees a stable source of funding. Now, obviously government has to evaluate from year to year its overall financial requirements, but certainly we would try as best we can within the financial limits that present themselves to allow this agency to continue to operate within its management plan.

P. Nettleton: Again, though, I draw your attention, if I may, to the potential impact on the registry's ability to deliver its service. Obviously the service has to be provided, and potentially there's some difficulty in terms of the ability to deliver that service, given the 2.5-percent-per-year reduction in budget over time. Perhaps you could address that.

Hon. A. Petter: As I indicated, the management plan sees a stable source of funding because of the very concern that's expressed here. Having said that, I already indicated that improvements have been made in reduced costs, and we'll continue to monitor that. If, due to efficiencies and other measures, we can achieve further savings, we certainly won't turn our back on them. But I agree with the member that performance and service are important indicators here, and we don't want to see those compromised. For that reason, the management plans sees an ongoing -- not a reduced -- level of funding in the coming years.

P. Nettleton: I draw your attention, on the same page, to where the business plan refers to an annual growth of 4 percent in the same corporate registry. A question I would have is: does this refer to volume of transactions or some other measure? Will the increase in revenue as a result of growth keep pace with costs, or are user-fee increases anticipated?

Hon. A. Petter: No. What's being referred to here are, as I understand it, increases in the volume of registrations. Of course, as the volume of registration increases, so too do the revenues that flow into other registries because of the fee structure. So this increase in growth could bring a commensurate increase in the fees that support the registry.

P. Nettleton: So you do not anticipate fee increases. Is that correct?

Hon. A. Petter: I'm not aware of any fee increases that are planned at this time. As I say, there will be a growth in the overall fees collected if there is a growth in the volume of registrations. That will then enable government the opportunity, if it so chooses, to ascribe some of that growth in overall fees back to the registry, if required, in order to continue to provide service. If, of course, registry can take advantage of this growth to achieve economies of scale and doesn't require that incremental revenue, then it can be applied to other uses. But certainly a growth in the volume of registrations will necessarily produce a growth in fees and fee revenue without having to increase the fees per transaction.

P. Nettleton: I again refer you to page 4 of the 1996-97 business plan, under the heading "Technology Changes." The business plan indicates that "current technology initiatives need to succeed, or additional labour will be required." Were these initiatives to fail, it would obviously undermine the objectives of the SOA. I'm just wondering, if I may, what assurances the minister may have in relation to technology initiatives -- that they will indeed succeed.

Hon. A. Petter: I guess I can report on one of the most recent developments, which is the automation of the mobile home registry, which seems to be progressing well and producing a more efficient and cost-effective service.

P. Nettleton: Certainly if that has been your experience in terms of the mobile home registry, I suppose that is helpful. However, I am just thinking in terms of the overall plan, in terms of the implementation of technological changes. What assurances has the minister been given in terms of these initiatives as to their likelihood of success?

Hon. A. Petter: I beg leave to make an introduction.

Leave granted.

Hon. A. Petter: I draw to the members' attention that seated in the gallery today is the deputy minister responsible for Treasury Board, Don Wright, and his son, who I understand have just returned from collecting a championship tro-

[ Page 4683 ]

phy in respect of the baseball team which I believe Mr. Wright coaches. If he does as well for Treasury Board, he may get another trophy. I just can't believe they don't have something better to do this evening, but in any event, I'm very pleased that they're here with us this evening.

The answer is that there are obviously no guarantees, but there are management plans and performance measures that have been adopted to facilitate the technology changes that are contemplated in respect of these registries. My understanding from staff is that they have every expectation that those initiatives are likely to succeed. The ones that have been implemented to date have shown some measure of success, and I don't think you can do much better than that.

[8:45]

Hon. A. Petter: Well, of course, government regularly reviews the legislative requirements of various ministries, including the Ministry of Finance, and this particular legislation will be included in that review. Really, I guess I don't want to stray into areas of future policy, which, of course, are not the legitimate subject of debate. Legislative needs will be evaluated as they arise from time to time.

P. Nettleton: Under the heading "Strategic Goals -- Three-to-Five-Year Period," I would refer you to page 8 of the 1996-97 business plan. Reference is made to improving the quality of information for which it is responsible -- that is, the SOA. I'm just wondering if perhaps the minister could enlighten us as to what the problems have been or what the problems are that have been identified in terms of accuracy, security, completeness and integrity. And could he perhaps give us some indication of which registries those problems have been identified in and how these difficulties are to be addressed?

Hon. A. Petter: Yes. The corporate registry is the third-largest in Canada and administers all matters related to approximately 250,000 -- a quarter of a million, in other words -- active, domestic incorporations, about 19,000 not-for-profit societies, 196,000 partnerships and proprietorships, and some 600 cooperative associations -- about 465,000 entities in total. So it's a huge undertaking, and what is being sought is to maintain the highest level of quality control in respect of the handling of those registrations. That's being measured against the number of formal client appeals, the number of successful formal client claims and suits, the number of errors or corrections and the number of lost records.

I must say that while in each of those categories there are areas in which there are shortcomings, they are small indeed in relation to the volumes. I can give the member some indication numbers. Successful formal client appeals: the present standard was for one per year, and the year one standard was one per year. The number of successful formal client claims: present standard two per year, and the year 1 standard was two per year. There is one lost file per year. And in terms of errors, the personal property registry has 0.035 percent registry corrections per year. In the corporate registry, 2 percent of files have an error on the computer system. So, while one wants to continue to improve, I would suggest this is a pretty impressive level of quality in terms of quality control when measured against the volume of transactions that flow through these registries.

P. Nettleton: This brings me to my next and final question for the minister. Page 9, which I believe the minister has referred to, appears to document successful appeals and client claims against the various registries, as I believe he has indicated. But perhaps the minister could elaborate, with some indication as to the costs associated with these claims, both in terms of legal fees and administrative costs from the point of view of the SOA and also some indication as to the awards in the case of civil actions involving the courts.

Hon. A. Petter: I do not have estimates of costs with respect to awards or claims, but I'd be very happy to have staff research what those costs are and to provide it a written form to the member, if he would find that helpful.

F. Gingell: What subject would you like next on your agenda?

Hon. A. Petter: As tempted as I am to suggest any number of topics, I think to come back to the Treasury Board staff might be most appropriate.

F. Gingell: We had an opportunity over the. . . . One of the things about having the House adjourn on Wednesday was that it gave one the opportunity to sit and think about some of the questions and discussions we had earlier. I wish to revisit some of the matters we have discussed previously. Perhaps the minister or his staff have had a chance to give some thought to some of the issues.

The first question that I have, to get this put into context, is about the $170 million that is included in this year's budget from the sale of various assets. Could the minister give me a listing, one after the other in the list, of where they have got to at this point? I appreciate that they may not have all the answers yet, but could we know where we've got to so far?

Hon. A. Petter: Unless I'm corrected in the next few minutes as a new complement of staff arrive, I believe that to date there have been requests for information in respect of some matters related to the information technology issues we discussed last day. There has been a request for information in respect of vehicle management. I believe -- but I will reserve the right to correct myself, should I find out I'm wrong -- that in terms of formal processes, those are the two formal processes in which there has been a sharing of information publicly.

In respect of other matters, there has certainly been work internally. I referred earlier, for example, to the fact that in respect of vehicle management services, a consultant has been retained and is providing information to government in respect of how best to proceed in relation to that. I believe similar work is going on in respect of information technology, to evaluate the responses from the requests for information in order to best take advantage of the market opportunities that exist in the information technology area.

F. Gingell: The amount that was included in the budget is shown as $170 million. I can appreciate that the minister isn't going to want -- as he didn't last week -- to identify that down to the dollar and cent. But does information technology and vehicle management add up to $170 million in total?

[ Page 4684 ]

Hon. A. Petter: Building on my answer previously and the one I gave the other day, the three principal areas are: vehicle management services; ITSD, or information services within government; and the B.C. Systems building and associated equipment. As I've indicated, there have been two requests for information with respect to the first two. With respect to the B.C. Systems building and equipment, there has certainly been work undertaken to try to ascertain the value and to prepare for the disposition of some of those assets, but I do not believe there has been a public offering or process with respect to that element yet. There are also some other smaller opportunities that may exist throughout government for asset disposition, but these are the three areas that, as I indicated last day, form the bulk of opportunities that we believe can reasonably be expected to generate the $170 million in revenue.

F. Gingell: Also included in budget revenues is the next category, which is "Contributions from Government Enterprises." These are the liquor distribution branch, which is an agency or a proprietorship; the B.C. Hydro and Power Authority, which is a wholly owned subsidiary; the B.C. Lottery Corporation, which is a wholly owned subsidiary; and then a classification called "Other," for which the revised forecast shows $14 million for 1996-97 and $113 million, or an increase of $100 million, from the previous year. If anything were to be realized from the sale of the B.C. Systems building and hardware, that would be income of B.C. Systems and would flow through to the government in the form of a dividend through contributions from government enterprises.

My question is: has any portion of proposed proceeds in excess of book values from B.C. Systems been included under the category "Contributions from Government Enterprises"?

Hon. A. Petter: Because that would constitute double counting, the answer is no.

F. Gingell: Having been through an exercise and having looked at the changes that have been made to the special directives relating to the B.C. Hydro and Power Authority -- I see how you're going to strip some high dividends from B.C. Hydro -- I would presume that the $113 million here would obviously consist of dividends from other government enterprises -- B.C. Rail. . . . Can the minister give the committee some idea of the additional revenues that they anticipate getting from other government enterprises that are not listed here?

Hon. A. Petter: The two principal ones here would be B.C. Rail and B.C. Buildings Corporation.

F. Gingell: I take it that the difference here between "Asset Dispositions," where you've dealt with a wholly owned subsidiary of government, and "Contributions from Government Enterprises" is that "Asset Distributions" would include such things as the total sale and windup of a corporation, but contributions would just be normal operating profits. Can the minister advise whether any anticipated dividends from B.C. Buildings Corporation would arise by reason of the sale of buildings owned by B.C. Buildings Corp?

[9:00]

F. Gingell: I can appreciate that the minister recognizes and the financial accounting officers recognize that sales and leasebacks aren't going to give rise to income but do give rise to cash. I haven't got the numbers here, but I would imagine that B.C. Buildings Corporation has a fairly substantial surplus or retained earnings that it has accumulated over the years. So a sale and leaseback of some property, even to the government. . . . I hope that you don't do it for the business of paying dividends but you do it only because you will be borrowing money at a lower rate than the province can borrow at. In fact, maybe I should stop there.

Has Treasury Board put in place any standards that Crown corporations and other agencies or other portions of Crown operations must meet, in that any sale and leaseback will only be done to improve the financial position of the government -- i.e., you will be replacing borrowing with lower-cost debt and completely ignoring how it might appear in the accounts?

Hon. A. Petter: We have indicated that the contributions that are made ought not to contribute to additional debt of Crown corporations. I offered sale-leaseback merely to be comprehensive, and that would only occur where there is a real saving to be achieved with all the accounting constraints that associate with that. In fact, I expect the bulk of revenue here to come about through the sale of properties, where properties are carried on a book value that is below that of the market value, and therefore there is a real profit to be had in the sale of certain key properties that are carried on the books of a Crown corporation.

F. Gingell: This property is extraneous to the current needs of government and not planned to be used for government use.

Hon. A. Petter: First of all, with respect to BCBC, the plan calls for BCBC's debt-to-equity ratio being maintained near its long-term historical value and not being altered by this initiative.

In respect to the sale of properties, I think that properties which are extraneous to government needs and also properties in which the market value of those properties exceeds substantially the book value and where, through sale, that incremental value can be realized. That doesn't necessarily mean that those properties are extraneous to government use. That will be the case in some situations; it may not be in others.

F. Gingell: I'd like to suggest to the minister that in any case where the property is leased back to the government on a long-term lease, you have not realized anything. It's purely and simply a means of borrowing.

Hon. A. Petter: Again, we're talking about one hypothetical situation here that could arise. But where there's a property that has a market value which exceeds the current 

[ Page 4685 ]

book value, what I anticipate might happen in that situation is that BCBC might well sell that property. BCBC would then lease back the property. The amount of rent paid, as it were, by a government ministry or other agency for that would not alter. That relationship would remain the same. It would be BCBC realizing an incremental value from the property that results from a difference between the market value and the book value, which can then be translated into an increase in the profit position of the corporation, which can then be translated into a contribution towards the revenue stream provided to government.

F. Gingell: I'm sorry, but I'm really disappointed. This government has people in Treasury Board that should know better. A sale and a leaseback. . . . You would be paying back the proceeds that you get from the sale; you won't be making one damned cent. This is purely and simply marking up future incomes that B.C. Buildings Corporation has earned. Yes, it is. It's no good shaking your head. It's just phony bookkeeping that this government does time after time after time. It's like the minister standing up and saying: "We've cut the expenditures this year over last year." You know that it isn't true. You know in your heart that it isn't true, and you know in your heart that this is the wrong thing to do.

You need to bring sensible financial management, and if the property is extraneous to government use and isn't needed, by all means sell it. But you're just going through a bookkeeping exercise that will result in the government having to pay back the purchase proceeds. I'm sorry to get so cross, but I was hoping that finally we would have a Finance minister who would bring some discipline and some common sense and some good financial management to this government. This is absolute nonsense.

Hon. A. Petter: Well, I think the member is getting into a froth about something that really does not justify that. What we're talking about is the fact that as government is being downsized, there is less requirement for buildings to the same extent. And within BCBC. . . .

I want to speak to the member through you, hon. Chair, because I do want to help calm him down and bring him back to earth.

BCBC right now currently leases some buildings. It owns some land. It does a range of things. BCBC does not have the same requirement for buildings as it did previously, because, in fact, the requirements of government are substantially less, if for no other reason than that government has reduced the complement of government employees by a significant amount -- by a substantial amount. So BCBC is being asked to reduce the complement of buildings and properties it retains, in order to provide for that smaller requirement. In doing that, BCBC will be selling various properties it has available, but it will be asked to do that on a strategic basis to maximize its return to itself and to the taxpayers. That means it may choose -- strategically, in some cases -- properties that are, in the short term, extraneous to use; in other terms, that may not be extraneous in the next few years but over time will be rationalized as leases are phased out, etc.

This is not an attempt to play around with accounting or bookkeeping whatsoever; it's an attempt to try, in the process of BCBC reducing the requirement it has for buildings it provides for the government -- the stock of which includes both leased properties and owned properties -- to do that in a strategic way that maximizes the return to BCBC, in a way that satisfies accounting requirements. It's not to play games but to downsize in an effective way.

It may be that there are buildings required for two more years, but the market price right now is one that enables BCBC to realize a major return and then to shift people over after that two-year period into other buildings. That can be done without having to await the two-year period, in order to maximize the return and strategically move forward in a savings exercise. That is what is meant here.

I think I'm suffering a little bit here, hon. Chair, from being more forthcoming than perhaps I should in terms of engaging in hypothetical discussions that have got the member imagining accounting manoeuvres that really aren't being contemplated here. What's being contemplated here in respect of this one contribution is to provide latitude to BCBC to downsize its requirement to own and lease buildings, to realize a benefit from that, to return that benefit to the taxpayer and to do it in a way that doesn't affect its debt-equity ratio.

In my answering hypothetical questions, the member seems to imagine a very different scenario, I think, than the one I'm trying to outline. Maybe I should just be a little more traditionally less forthcoming about it, but frankly, I think it's helpful to be a bit more so. I hope I can reassure the member that that indeed is what's being contemplated.

F. Gingell: Mr. Minister, I asked you a question: is there going to be any sale and leaseback? Now, in the normal business connotation, sale means sale and leaseback means normally for the remainder of the useful life -- for long-term purposes. I also said to you that if you have any property that is extraneous to government needs, that's wonderful; I don't have any argument.

I just don't get the exercise of selling and leasing the property back. The lease is going to be based on the sales price. The government is still going to be paying this in monthly payments. If you can sell and just lease back for short-term periods in which you can subsequently dispose of that lease, then that's not a sale and leaseback in the normal business sense of the term. I thought that was what you were speaking about -- long-term deals.

So let's just move back. We are at B.C. Systems Corporation. The other day you spoke of the possibility of selling both the building and all the hardware. Will the hardware be leased back?

[9:15]

In the case of the B.C. Systems Corporation, I think the largest potential for that exists in the building itself and particularly in some of the surplus land that exists around the building. In respect of the equipment that might be sold in association with that, that equipment. . . . Here I'm going to get into trouble again, because I'm hypothesizing. I don't want to give categorical answers when I'm not 100 percent sure. But I hypothesize that the only circumstance in which equipment that's sold might then somehow find its way back into government use is if, and only if, there's a business case that the 

[ Page 4686 ]

service being acquired which utilizes that same equipment achieves a real operating saving to government -- in which case there is a business case that in fact there's a real saving.

But the idea here is not to take. . . . As I tried to state to the member last time in order to avoid these kinds of hypothetical questions, we are and I am particularly very sensitive to the need to guard against converting income streams into capital values and the like, and to make sure that we pursue this disposition strategy -- be it within Crowns, within government, within the windup of B.C. Systems -- in a way that produces a real return based on business case, based on value of land and assets that are either extraneous to government use or whose use can be substantially improved and produce operating savings if provided to a private sector provider, who may use that equipment for a variety of purposes, only one of which may relate to providing service back to government.

For that reason, I don't want to rule out the possibility. But I do want to assure the member that I and staff are sensitive to the accountant concerns that he raises and have done our best to ensure that this accounting treatment is one that will provide for real documentation, which the member is no doubt seeking, that these savings are real and verifiable.

F. Gingell: So I presume that the equipment in the building at 4000 Seymour Street has a whole bunch of additional capacity, number one. Otherwise there would be no outside use. Number two, the government can get by without it, even though it has been referred to as the backbone of the government.

Hon. A. Petter: It's not so much that the government believes it can get by without the services but that the services can be provided, whether it's by a provider who utilizes that equipment or some other equipment, in a more cost-effective way that will produce demonstrable savings to the taxpayer.

F. Gingell: In addition, there has been discussion -- it was on the Judi Tyabji show with John Shields last week -- about the possibility that not software but data which I think we classify or call B.C. OnLine could also be privatized and may produce some proceeds that will be part of this $170 million in sales. Can you advise the committee if there has been any progress on that side of the issue?

Hon. A. Petter: That is one of the areas in which there has been a request for information and some substantial interest from the private sector that will assist the information technology branch of government, in consultation with Treasury Board, in crafting a request for proposals that can maximize the potential to achieve a return to government for the sale of some of those assets and associated services.

F. Gingell: Can the minister list those data groups within B.C. OnLine and within -- I forget all these initials -- ISTA that are being considered for contracting out?

Hon. A. Petter: To be clear in a way that I think may preclude a lot of unnecessary questioning, the proposal is not to privatize any of the databases. The proposal is to provide private sector operators an opportunity to take over the operation of the service that provides access to those databases. I think I mentioned previously how a private sector operator operating those services, for example, for a longer period of time could achieve efficiencies and a greater return, through integrating those access services with other services that the private sector provider might provide -- could achieve economies of scale and the like, all of which would contribute to the operation of these services in a way that is less costly and hence produces a benefit in terms of what the private sector operator would pay for taking over the service.

F. Gingell: But the actual data groups. . . . What sort of things are we speaking of?

[G. Brewin in the chair.]

Hon. A. Petter: I'd be happy to provide the member a copy of the request for information, which specifies a lot of this. The answer is: it hasn't been finally determined what databases might be involved here. That is going to be part of the evaluation in response to their request for information. But the kinds of databases that might be accessed through this service -- and I want to reiterate that we're not talking about the data itself being provided; it will continue to be managed by government -- would include things like geographic survey information, registries of the kind we discussed earlier today, personal property and corporate registries, and potentially, land title data and the like. Obviously -- just to anticipate where the member may go with this concern -- there would have to be safeguards provided within any arrangement to ensure that quality control and security concerns which might relate to the handling of that data were fully covered off in any such arrangement.

F. Gingell: So the way I visualize it -- and please correct me if I'm wrong -- government in its various roles and functions collects data on drivers' licences, land titles and various things that are registered, and it would be responsible for inputting the data into the computer memory systems. Government would have complete access to all of that data and would never be. . . . Government's cost would be the cost of putting it in there and its own cost of accessing it.

What you're contemplating is privatizing the marketing and the management of third-party access to this data. Third parties would pay a hit fee -- i.e., every time they access the computer system and get some information from it, they pay a fee. These people that have that access and authority would be preauthorized. They would have billing numbers or something. I understand that the government provides this service now. Have I got it right? Is it correct that the government provides this service now?

Hon. A. Petter: Yes, it does, but the expectation is that the service might well be provided more efficiently and effectively by a private operator who has increased capacity to provide the service for a longer duration of hours, to achieve economies of scale and also to maximize the potential markets for the information, etc.

F. Gingell: At the moment, are there any rules and regulations that B.C. Systems or ISTA have put into place that require the people who apply for access to qualify -- i.e., do they have to be Canadian citizens or British Columbia citizens, or do they have to put up a deposit or something? Are there any rules and regulations around access?

Hon. A. Petter: Well, let me start by saying that as we move into the detail concerning these requests for information, which will culminate in requests for proposals and some of the detailed information, the member may want to take this up with the minister who is directly responsible, the Minister 

[ Page 4687 ]

of Employment and Investment. He is more familiar, and his staff may be more familiar, with the specific operations and requirements surrounding this information. Obviously it is that staff which is undertaking these various initiatives, albeit with due diligence through Treasury Board.

I believe that the arrangement for access to this information is based not on some credit arrangement but on prepayment. I'm not aware of exactly what the restrictions on access are. I guess it would vary from database to database. For most of the databases contemplated, I don't think they are. . . . These are not highly confidential databases. This is, by and large, publicly available information.

Again, that's a matter that could be taken up with the minister responsible, and obviously whatever restrictions were necessary to ensure both the quality of the database in terms of access to it and its security in respect of any restrictions that might exist would be carried over and incorporated into the arrangement that was undertaken with any private provider.

F. Gingell: We're now at the end of June. Doesn't time slip by? You've got a request for information out. They will come back -- what? -- in a month's time.

Interjection.

F. Gingell: Oh, they have come back. So are you now at the point where you're going out with the RFPs?

[9:30]

F. Gingell: Knowing how long all these things take, and with the need to prequalify your bidders and all the evaluations and then the ongoing negotiations, does the minister think that it is likely that any deals can be finalized -- a genuine document, not an agreement to enter into an agreement -- by the end of March 1998?

Hon. A. Petter: Absolutely, and without. . . . Obviously I want to be careful and guard information that could affect the competitive process, but I'll put this discreetly.

There has been some very substantial interest, even in advance of the RFI, amongst private sector companies -- and one in particular -- for this kind of initiative. But we were determined to go through a process of information-gathering and due process in order to both maximize the return and ensure a fair, competitive opportunity.

But this is not something -- and I think I indicated this last day -- that has sort of been dreamed up. The program review undertaken last year identified a few select opportunities which we felt presented real and realizable revenues to government within the time frame of this fiscal year, and this was one of them. The process we're going through is as much to validate some of the interest that has already been expressed and put it to the test of perhaps even greater interest as it is to test whether there is an interest. In fact, in most of these cases I think we've established that there is a substantial interest and the potential for a significant return, hence the estimate that's been provided. And the question now is to go through the due process and test the market -- provide an opportunity for others to demonstrate their interest along with the interest already expressed.

F. Gingell: Recognizing that it is only the end of June, I appreciate that it's inappropriate and probably not practical to get a fuller description of where you are and where you're going and what you anticipate realizing. . . . I appreciate that the minister appreciates some of the issues surrounding accounting treatment. I read "Accounting for Sales and Lease-backs." I haven't read one of those for 25 years.

But has it been necessary for the Ministry of Finance to obtain opinions from any accounting authorities within government -- comptroller general's office, auditor general's office -- or outside government with respect to the correct accounting treatment of any of these transactions?

Hon. A. Petter: Indeed, in order to determine appropriate target levels that I felt were consistent with our general approach in the budget to prudence, both as to the amount and as to the accounting treatment, advice has been sought throughout from the comptroller general to ensure that the accounting treatment is consistent with generally accepted accounting practices, to make sure that we are not in some way miscalculating or converting values that ought not to be converted and to put these proposals to the test to make sure that the values we established were consistent with good accounting treatment. So that has been part of the iterative process that gave rise to the estimate in the budget and the proposals that are now coming forward.

F. Gingell: I can't help but mention that when we were dealing with the Columbia downstream benefits, you went to the comptroller general. You were the Minister of Forests, but the then Minister of Finance, or her representative, went to the comptroller general for an opinion on how to treat the proceeds from an accounting viewpoint -- if there was sale of future rights to that energy -- and didn't like the answer. Then you went to the auditor general, the auditor general wrote you an opinion, and you didn't like that one. So you then went to KPMG. And although it was two against one -- and three against one if you included my subsequent opinion. . . .

Hon. A. Petter: Three against two, then.

F. Gingell: No, no, no, no: three against one.

You then kept going until you got the one that you needed. Now, I appreciate that some people don't like me saying those things, but I say them anyway.

In this particular case, could I have a copy of the comptroller general's opinion, please?

Hon. A. Petter: No, I won't give that undertaking, because these are the kinds of opinions that have been sought. First of all, I'm not sure of the extent to which they would have been in writing as opposed to not. But they also concern, obviously, valuation issues that in the public domain could influence the success of the competitive process and give information that could be detrimental to achieving the maximum return of value.

I will be happy to provide the member with copies of the request for information and, once we have gone through the process, to provide to the member a full accounting of the 

[ Page 4688 ]

process and any opinions which staff tell me -- I think I used the term "generally accepted accounting principles," and I was encouraged to use the term "governmental accounting principles"; I think there's some distinction there -- would apply, and upon what opinion and what advice that was provided. But we're right. . . . Obviously these opinions are being sought in relation to questions of valuation which are central to the competitive processes that are just starting to unfold.

F. Gingell: Actually, the opinions that I sought were not to do with values -- I appreciate that one wouldn't want to let those out -- but they are with respect to accounting treatment. I must admit that I don't see that getting those would cause any problem. Besides that, this government is very skilled in the art of severing. I'm sure you'll be able to sever from the opinion those portions that you think would be inappropriate to put into the public domain without severing those portions that deal with the accounting policy of the government. So maybe the minister would reconsider that in light of a reduced request.

Hon. A. Petter: Well, I don't want to give an undertaking that I cannot deliver on. What I will say to the member is this: I will ask staff to review what advice they have received from the comptroller general, and if that advice is of a sufficiently general nature or severable nature that it could be shared without prejudicing the process, then I will endeavour to provide it to the member.

I want to make clear, though, that it isn't just specific values but the structure of various arrangements that I understand the comptroller general might have been asked to look at and to give accounting opinions as to what, if equipment were available or not available -- whatever it might do -- that impact might be. Obviously those hypotheticals also govern the kinds of proposals that might come forward. It isn't just the value, but it's also the configuration of bids and of arrangements.

So I will ask staff to see if there is some way to provide the member with some information of the kind he asks. Certainly I will undertake that once we have completed these processes, once decisions have been made and the competitive process has been satisfied, the opinions that pertain to them will certainly be made available at those times. As I say, if we can provide some information on a more limited basis before then and that is helpful, we'll endeavour to do so. But I don't want to overcommit to something I can't deliver on.

F. Gingell: Just to get some idea of the current state of affairs, do you have available for the committee the amount of money on an annualized basis that is being realized from the fees that B.C. OnLine collects at this time?

Hon. A. Petter: We don't have that information at hand. Either I can try to provide it to the member, or he might want to take it up with the Minister of Employment and Investment during the part of his estimates in which information systems and technology issues are being discussed. The deputy minister will be there with staff to provide that more specific breakdown of revenues.

F. Gingell: The "actual costs" category within Treasury Board talks about both asset dispositions and revenue enhancement in the same box. I wonder if the minister, under Mr. Steve Hollett, could advise the committee what revenue enhancement projects are in mind at the moment.

Hon. A. Petter: There are three principal areas from a Treasury Board perspective. One would have been the asset dispositions. Another would have been the dividends from Crown corporations, which we've discussed. And the third would be incremental revenues from B.C. Lottery Corporation and other sources associated with the modest expansion in gaming.

F. Gingell: Dividends from Crown corporations, additional revenues from B.C. Lottery. . . . And I didn't catch the first one.

Hon. A. Petter: The first one was the asset dispositions that we've already spent a good deal of time discussing in this debate.

F. Gingell: Well, that didn't tell me very much. I had presumed that it said "asset disposition and revenue enhancement." I thought that the additional dividends. . . . You put through the setting aside of the special directive to B.C. Hydro to be able to increase the dividends there. Are there no other revenue. . . ? I mean, we know about B.C. Hydro. We know about your monstrous planned expansion of gambling. Are there no other projects?

Hon. A. Petter: Well, if we're talking about this particular aspect of Treasury Board, the other area, I guess, that they would have had involvement in would have been the Crown land sales component, in addition to the three general areas I've already described.

[9:45]

Hon. A. Petter: That is correct; we are not looking at that aspect.

F. Gingell: I've come to the end of questions with respect to Treasury Board. It is a quarter to ten. We can start something else if the minister wishes, or we can adjourn and ask leave to sit again.

Interjection.

F. Gingell: May we have a three-minute recess?

The committee recessed from 9:46 p.m. to 9:48 p.m.

[G. Brewin in the chair.]

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

Motion approved.

The House resumed; the Speaker in the chair.

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

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

[ Page 4689 ]

Hon. J. MacPhail moved adjournment of the House.

Motion approved.

The House adjourned at 9:49 p.m.

PROCEEDINGS IN THE DOUGLAS FIR ROOM

The committee met at 6:39 p.m.

ESTIMATES: MINISTRY OF
HUMAN RESOURCES
(continued)

Hon. D. Streifel: I trust we all had a sufficiently suffisancifying repast. Is that how it goes? I challenge you, Hansard, to figure that one out.

M. Coell: We talked earlier about emergency shelters and single-person hostels. I'm interested to know -- I gather some of that program may have been transferred to the Ministry for Children and Families -- if there are still any funds in this budget with regard to emergency shelters and single-person hostels.

Hon. D. Streifel: The only movement to Children and Families is youth shelters. The rest is under my ministry. The budget is sound and intact. As a matter of fact, here we go again. I've asked that we have a look-see at our hostel and shelter program to ensure that we are serving the needs of the folks that require the services. I think that as a matter of course, it's sound practice to do this on a periodic basis to ensure that we're meeting our goals. I have a particular interest in some locations and some areas. I've had a tour of some of the hostels and shelters. I think it's important that our program address those that need us.

M. Coell: My interest, specifically, is in the Vancouver area. I realize there are hostels and shelters throughout the province, but I have had calls and concerns raised about shelters and hostels in the Vancouver area. I just wonder if the minister could outline for me the number of beds available in the Vancouver region.

Hon. D. Streifel: Is the member looking for the Vancouver area or Vancouver city proper?

M. Coell: The Vancouver region.

Hon. D. Streifel: Okay, we'll deal with that. The Crosswalk shelter run by the Salvation Army in Vancouver, 12 beds; May Gutteridge Community Home, St. James Social Service Society, Vancouver, six beds. Is this the information the member is looking for? I got the nod. Fine, we'll go on. The Catholic Charities of the Archdiocese of Vancouver, 80 beds; Harbour Light, Salvation Army, Vancouver, 25 beds; Dunsmuir House for Men, Salvation Army, 23 beds. I'll slip down: Richmond Salvation Army, eight beds; Lookout Emergency Aid shelter, Vancouver, 50 beds. We can go to New Westminster and Mission, and on and on.

To try to add a little more completion to this, we have emergency shelters: Powell Place, 36 beds, run by the St. James Society; Vi Fineday Family Shelter, Vi Fineday Family Shelter Society, 15 beds; the Homestead, Salvation Army, Vancouver, 11 beds. And then there's New Westminster and Surrey, if you want those ones, as well, as part of this.

M. Coell: I just want to spend a moment looking at the Vancouver area and the number of hostels and emergency beds. It's an area that we've talked about before in these estimates, an area where you have a lot of street youth, a lot of child prostitution as reported by the Vancouver city police. I'm just wondering whether the ministry is doing any research into how many beds would be or could be used. This is how many there are, and I'm interested to know of any research the ministry has done with regard to the number of beds and the potential for either less or more -- I suspect more.

[6:45]

M. Coell: Program overall.

Hon. D. Streifel: The program overall is generally undersubscribed: around 75 to 88 percent occupancy rate, generally. In some areas, in some of the shelter programs or the areas that I'm familiar with, it's as low as 50 percent occupancy, or utilization. I guess "occupancy" is more of commercial hotel-type of language -- utilization. So we're not full. Even this past winter, the shelters -- emergency and regular -- weren't full.

M. Coell: That's what the minister mentioned earlier on. I was wondering. . . . To my way of thinking, you literally have 1,000-plus people sleeping on the streets in Vancouver at this time of year -- and that's as reported by the Vancouver city police. Why there would not be a demand for shelters. . . . Is there something that we're doing wrong in providing them? Or are we not advertising them? I just fail to see why someone would not avail themselves of these services. Has the minister given any thought to the reason for that?

Hon. D. Streifel: It is a bit of a problem, I suppose, when viewed from that perspective. I'm very tempted to say that the last time the Vancouver city police were asked for information about anything, they pointed at a bunch of folks that, in their minds, were committing crimes. They were saying that they were all welfare folks. We took exception to that. We didn't get a record correction from them, nor from U.TV, which seems to be the oft-most-quoted misinformation news service we have. But in fact, why those shelters aren't used to full capacity, I really can't answer.

I've undertaken a bit of a look into it to find out if we are serving the needs of the clients, as I've already mentioned. Maybe that will give us some of the answers. One thing we came up with, about mid-winter, was that we would have a shelter that was full and clients or folks coming forward to utilize those spaces. And more often than not, rather than 

[ Page 4690 ]

refer the excess need to a shelter that wasn't full, the lobby would come to the minister, saying: "Just give us more, and all will be better." So we really have to know why we don't have full utilization when there appears to be the need. If the member has any suggestions. . . . It seems to be a bit peculiar; I agree completely with the member. Again, it's one of the reasons why it's time to have a look and see if we can get rid of the peculiarities and serve the needs of those that need the help.

M. Coell: The beds in these facilities, I think, can be seen as a first line of interaction between street youth and the recovery process, and getting out of that circle. I just wonder whether any of these beds -- and it looks to me like there would be about 200 in the Vancouver. . . . Are any of them specifically designed for street youth and in particular, for instance, for youth involved in prostitution?

Hon. D. Streifel: I can partially answer this question for the member. That part of our shelter program is transferred to MCF. I would recommend that the member pursue that with the appropriate minister. But in fact, there are 12 beds for just the client base that the member was referring to -- the youth at risk on the streets: the Safe House, six beds in Vancouver, Family Services of Greater Vancouver; and an aboriginal safe house, operated by the Urban Native Youth Association of Vancouver.

M. Coell: The 12 beds that are not part of this ministry are the ones that have been moved to Children and Families.

We have a number of other areas we wish to canvass, but at this point I'll turn it over to my colleague.

V. Anderson: Before I go on to another area, I just want to finish up a couple of areas we had touched on briefly. Before the supper break, we were talking about the area of warrants. I want to clarify the minister's earlier comments on why the area of warrants was introduced into the questionnaire. Is it a practice in other ministries of government, when people are asking for services, to have questions about their warrants, driver's licence, their ID or whatever else? Are there other areas of government in British Columbia that are the model or the reason that warrants were introduced into this particular questionnaire? Could he tell me. . . ? My awareness is that it was never there before, until just this last change. This is the first time it has been there.

Hon. D. Streifel: Of course, the member is aware that it would be totally out of order for me to speak for other ministries and programs. Suffice it to say, hon. member, that in our lives there are processes that are associated with government, in the broad context, where an individual is subject to some form of investigation or criminal records check if you're dealing with children and that kind of issue. Surely to goodness, the member would agree that in some circumstances an individual may have to pass some scrutiny.

Do we have any folks around here within Corrections? In fact, I'm not quite sure that you'd get a job as a corrections officer if you've got an indictable or returnable warrant or any kind of problem in that respect. It's not totally unusual in our society that there would be some form of a check and balance here.

In this case, there are individuals in our society who may be here or may approach us for assistance and support, where it would be in their best interests at the end of the day to deal with their problem. Then they can get that behind them, resolved. I would imagine that that was part of the rationale behind the thinking of the Liberal Party when it was included in their election platform in the spring of 1996.

V. Anderson: I thank the minister for his comments. Now he's suggesting that warrants have been included for the well-being and the psychological and social improvement of the person who may have claimed that they have a warrant. I think that's an interesting approach. My only comment is that you can rationalize it all you like, but from reports back from the clients, the majority of them are quite convinced that it was put there because it wants to display them as being persons of ill repute and unwarranted.

This is the very thing the minister said he didn't want to do. I appreciate that he didn't want to do that, but it's certainly seen the other way around -- as an infringement on personal rights. I expect it won't be too long before somebody will take it to court and have it tested in the courts for the infringement of personal rights. I hope someone will soon do that so they can clarify it.

But I'll move on from there and just mention to the. . . .

Hon. D. Streifel: Before we move on, I wouldn't mind a chance to respond to that.

V. Anderson: Fine.

Hon. D. Streifel: I sincerely hope the member opposite isn't suggesting that anybody who approaches us, for whatever reason, should qualify without question for assistance or aid. Certainly the member wouldn't suggest that we give a home and a safe harbour to individuals who have committed serious offences in other parts of the country and that by supplying without question this level of support, these individuals find safety and don't have to be subject to the justice system. I find that a bit peculiar, given that I never heard the member speak against this when it was included in their platform in the spring of '96.

V. Anderson: You will have heard me speak against this item many times in the Legislature and in the community. Many times I have stood with the people in the community who have been against this kind of irrational conduct. I've spoken against it many times, and I'm well on record in the community for not accepting this kind of registration or this kind of invasion into people's privacy. I'm quite clear on that. I always have been, and I always will be.

The other thing I wanted to come back to with the minister when we were talking about youth treatment the other day was whether the minister had had the opportunity, since he does like to visit and know areas for himself, to visit the Pacific Youth and Family Services Society addiction service at Peak House.

Hon. D. Streifel: Not at this time. That will be in the future. I'll be on the tour again.

V. Anderson: I commend the program for youth and family at Peak House to the minister. One of the good things that this government did was establish that program a number of years ago, in about 1987. At that time it was serving a turnover population of about 40 people -- 20 in an initial treatment program and then 20 in long-term treatment. It was an excellent program, the only one in the province and probably one of the very few in Canada.

[ Page 4691 ]

It was unfortunate that previous persons in his ministry cut the program in half and did away with a good part of that program, with the promise that they would be doing others like it throughout the province but failed to do so. I recommend that the minister visit Peak House to have an opportunity to visit with them. I just pass that on because I commend their program. The graduates from that program, who come back regularly to their meetings and are glad to keep in touch with it, have spoken highly of it, and I have known them.

I want to ask the minister about the area of multiculturalism. It's part of the plan, as the minister knows, for every ministry to have a multicultural plan. Of course, this ministry is new in this sense and in 1994-95 had the plan of the Ministry of Social Services, but that's completely different from the present moment. I wonder if the minister could update us on the plan for his ministry in the area of multiculturalism.

Hon. D. Streifel: I would like to read into the record, and for the members, our involvement in the overall initiatives of government and particularly around this ministry. In the coming year, we will be conducting regional workshops on cross-cultural issues. There will be training for all employees on prevention of racial and other forms of harassment. We'll be producing a brochure, "Understanding B.C. Benefits," in a variety of languages, and we spoke about that in other questions under these estimates.

We will be reviewing ministry policies with a view to identifying those that may unintentionally create barriers for certain client groups, and we'll be in consultation with community groups on how best to deliver our services in a multicultural context. We feel that that will begin to fulfil our commitment to respect the multicultural makeup of our province and those who rely on us for help.

V. Anderson: The previous ministry had persons dedicated to multiculturalism. They had a manager of multiculturalism and a multiculturalism researcher. Have any of those special appointments and responsibilities in management and research carried over to the ministry?

Hon. D. Streifel: Yes, we do have an individual in our ministry who dedicates that part of their worklife to multiculturalism, to the programs that we deliver and where we will be delivering them.

V. Anderson: Is that person working on their own, or do they have an advisory committee from the ministry that works with them? Could you tell us the name of that person?

[7:00]

V. Anderson: I take the minister to imply that there's no particular advisory committee within the ministry that deals with multiculturalism and that this person is full-time or part-time in dealing with multiculturalism. Does this person work with the intercultural committee of the ministries?

Hon. D. Streifel: The answer for the hon. member is very simple: it's yes to all three.

V. Anderson: When you say yes to all three. . . . Part of the question. . . . Twice I've asked who the person is -- if you could name the person. Who is the person who carries on that role in multiculturalism?

Hon. D. Streifel: My apologies to the member. I hadn't heard the question of who the individual is. It's Randy Enomoto, for the information of the member opposite.

V. Anderson: When you talk about regional workshops. . . . Could you indicate the nature of these regional workshops that are being held and how many of them there might be throughout the province?

Hon. D. Streifel: For the information of the member, there would be 61 workshops spread around the province in all the regions. There will be additional regional workshops on particular cultural topics, at the request of the staff.

It may help the member to know that training for financial assistance workers on interviewing techniques when working with newcomers -- refugees and immigrants -- will also be included in how we deal with our client base.

I may actually flesh out this answer a little more, and it may get us towards the end of the questions. There are interpretive services for clients. Cultural competence is included in core training for FAWs and district supervisors, and will include input from advocacy groups. The member would like to know that.

Through its employment equity program, the ministry is seeking to have its staff reflect the diversity of the province's population. That's another initiative. Policy consultation with community groups, of course, and multiculturalism translations of income assistance eligibility form HR 81 are underway, as is the translation of key documents into Chinese, Czech, French, Punjabi, Spanish and Vietnamese. We have committed a budget of nearly $260,000 for multiculturalism employment equity. If that helps the member, maybe we'll get to the end of the questions.

V. Anderson: Yes, that helps considerably, and I appreciate the minister's interest and concern in this area.

A particular question that has come to me through my constituency office recently from the community has to deal with persons who are refugees in Canada, persons who are not yet landed immigrants, persons who are not Canadian citizens yet, but who have come into Canada as convention refugees and have a period of time before they're finished their process -- which may be a number of years. The difficulty is that they seem to be caught in between. They don't fit the formal standards. They're legally here in Canada; they're eligible to be here, but they haven't gone through the formal processes. How does Human Resources meet with their conditions? They're having trouble finding the slot where they are welcome or where they can find support as other people do when circumstances become difficult for them.

Hon. D. Streifel: The individuals in question have their needs met through the hardship benefits program until such time as their status is confirmed. That's the method we have here to deal with the needs of these clients.

V. Anderson: Could the minister explain the nature and the amount of hardship benefits in that regard? Are they comparable to basic social services for children and families? What's the benefit and the relationship here?

[ Page 4692 ]

Hon. D. Streifel: The basic benefit is the same as regular assistance benefits.

V. Anderson: The minister says they're hardship benefits -- so they're temporary, in that sense, I would gather -- but they're the same as regular assistance benefits. That's interesting, because I had an approach from a person from MOSAIC the other day, a counsellor who works regularly with. . . . In this case it was Somali persons. He was concerned that this was not the case, so I wanted to clarify that and, if so, establish some communication, if we can, with the minister to clarify that in individual cases. The letter of request that they had written to the minister had come back, giving them the impression that. . . . What the minister is saying now was not their understanding. It may have been a misunderstanding both ways. Their request for reconsideration of this was also supported from persons working here in Victoria through the Immigrant Services Society.

Hon. D. Streifel: The basic monthly allowance for support is the same as hardship or regular benefits. I'd ask the member to send over his particular concern. I wouldn't like to be caught in a circumstance of producing misinformation, and this one is another particular interest. I'd like to understand the points the member has. If he could pass this forward, we'll have a look at the specifics of the case.

V. Anderson: I thank the minister for that. As well as getting information, I'll have the people who have the direct information, which they're getting for me at this point, to send it to you directly so that you can work with them as well as with ourselves. So I thank you, and that's all for the moment.

M. Coell: I would just like to talk about medical benefits for people on income assistance and also about the dental program. I believe that last year in the Legislature, there were a number of new programs announced. The minister may refresh my memory, but I can't remember any cuts being made to medical benefits for people on assistance. I can distinctly remember some increased benefits for dental services.

Would the minister care to share with me the program for medical benefits that is in existence today? If there haven't been any changes since last year anticipated in this budget, I assume his comments would be brief.

Hon. D. Streifel: I'm trying to get maximum information for the member here. If I recall, the question is: what are the medical benefits? -- not whether they exist, but what they are, and what's available to certain client groups. Well, that would be MSP coverage, Pharmacare, dental benefits, optical benefits, medical equipment, medical supplies, therapies, medical transportation, diet allowance and natal allowance. That's the range of the benefits we cover. There are qualifications within certain groups of lesser or greater participation within those benefits. But that's what we have; that's what we offer. If the member would like. . . . Case by case I can't do. But category by category, I could certainly offer some more information if the member needs it.

M. Coell: Thank you. My understanding is that the categories haven't changed; there have been no additional categories from last year. I wish to spend some time on eyeglasses for children: what would the yearly rate be for a child whose family comes onto income assistance? They realize the child needs glasses. With what program and how would that parent apply for eyeglasses?

Hon. D. Streifel: For the member's information, I should go back to. . . . I don't want to tread out of order on this. The MCF -- Ministry for Children and Families -- role in the Healthy Kids program is to establish the policy and supply the budget. Our role is to deliver on behalf of MCF. So the questions pertaining to the budget, the policy -- the who, what, where, when and why -- should more appropriately be directed to the Minister for Children and Families. We deliver on behalf of their policy and their budget.

M. Coell: I appreciate that. I have the honour of being the critic for that ministry as well, so I look forward to asking the minister some questions regarding that program.

So I would be correct in assuming that the Ministry of Human Resources would be the payer for the eyeglasses. But the need for them and the doctor's visit would be taken care of by the Ministry for Children and Families. Then a request for payment would come to the Ministry of Human Resources.

Hon. D. Streifel: Yes, that's how it works.

M. Coell: The other issue that I want to canvass is dental programs. They may be in the same circumstance. For people who are on income assistance and who have emergency dental needs, whether it be for children or adults, is that covered by the ministry? How would a person go about applying for emergency dental work for a child or an adult?

Hon. D. Streifel: Does the question pertain to emergency services?

M. Coell: Yes.

Hon. D. Streifel: The client, the individual, would approach or go to the dentist to get it fixed. It would go in. I guess the report would go to medical services division, then it would be paid. But that would be emergency basis only.

It sounds very simple. I imagine the member will cross-examine me on the simplicity of that and come up with four or five cases from his constituency office that don't quite fit that mould. But that's basically how the emergency aspect of the program works.

[7:15]

Hon. D. Streifel: Yes. The client would identify who they are and how they're covered.

I've discussed this aspect of the program with my own dentist and many others this past little while, actually, to determine how it works for them, how they serve our clients and whatever processes may be modified to deliver a better program within the budget. So I'm in that process, as well.

It's going to sound a bit repetitious here. But these last few months, having had the time to break into the ministry and have a look at what we deliver and how we deliver it, with the splitting off to Children and Families, have given me the opportunity to really look at what we deliver on some point-by-point basis -- some specific programs and some-

[ Page 4693 ]

times in general terms. I believe that kind of review is healthy. It's something that I like to do. I shouldn't say that too loud. I have a lot of staff around here who just kind of lost five pounds, with me saying I like to.

But in fact, I think it's important. As our society changes, as our relationship with other provinces and within the federal structure -- the financial relationship -- changes, I don't think we can afford to stand pat on everything we do. It's important that we look at it. So I've undertaken to look at this one as well, to see what we deliver and whether we can deliver it better or not.

M. Coell: I would be interested in knowing whether there is a limit to emergency surgery. I'm thinking of a child, let's say, who goes over the handlebars on a bicycle and knocks out four front teeth and damages a set more. Would that all be covered, with no questions asked?

Hon. D. Streifel: In general terms, the question is more appropriately directed, as it was stated referring to children, to the Ministry for Children and Families. It's very difficult to give a point-specific answer to a broad question like that. I would try to simplify it and say that in general terms there is a capacity to treat the need, but as well, the dental benefit program is within a limited budget.

M. Coell: The point I wish to emphasize is that I believe the medical coverage for people on assistance is as good as it can be for emergency services. I believe that through hearing aids and eyeglasses, those sorts of things are covered adequately. I'm just concerned that for dental accidents, for people on income assistance, we make sure that a job isn't just patched up -- that we try and put someone back together, so that when they grow up they don't have to face a deformity because of an accident that we didn't have enough money in the account for. That's the only point I'm trying to make.

Hon. D. Streifel: Fair comment.

M. Coell: The other issue that I wish to spend some time on is a program, and I think I have a copy of it, which I'm sure the minister had some comment on -- at least I would hope he did. That was British Columbia's proposal for a national child benefit. There are a number of projects I would like to spend a bit of time on and get some input as to whether this was something that was worked up through the ministry -- this ministry produced it -- or whether it was outside the ministry for presentation to the federal government.

Hon. D. Streifel: The national child benefit strategy that we brought forward was done through Intergovernmental Relations. This ministry had involvement, as did several others -- Finance, Children and Families, Women's Equality -- and had particular input into what the needs of children would be, based on poverty as we know it and Canada's position in the world. This minister had the privilege to represent British Columbia at the national table negotiating the base position with the territories, provinces and Canada, and this minister had the supreme disappointment to realize that the federal Liberals in Ottawa were just kidding in their most recent budget when they talked about addressing the needs of Canada's children, when they put off until July 1998 any kind of an inclusion to address poverty. What it comes down to is redirected moneys that are delayed from a year previous. There are no new funds from the federal side.

On the provincial side, of course, you'll find out that to deal with the Finance minister, the extent of this program is very, very extensive in British Columbia. The support for families outside the income support system into the lower wage-earning brackets has been quite phenomenal, and there's been a huge movement towards the poverty line by a large segment of that community. I would love to get in and talk this one out for the next several hours. My ministry has very limited broad involvement but very tight direct involvement in developing our policies, and as the minister, I was there at the table.

M. Coell: The other one -- and I realize that the ministry may be the payer but not the deliverer of the program -- is Youth Works and a number of programs in that. Maybe the minister can enlighten me. Is this case similar to where the ministry is the payer but the program is developed and handled in another ministry?

Hon. D. Streifel: Yes, exactly so. Education, Skills and Training is the appropriate ministry. I have had input and involvement in developing the policies and movement in that direction. I do keep an eye on the clientele base, and I do keep an eye on the individuals charged with moving our youth into the workforce. I meet with them on a fairly regular basis, but the program itself would best be examined under Education, Skills and Training.

M. Coell: I'd be interested in hearing the minister's comments on the relationship between the two. From where I sit, it appears that the Ministry of Human Resources is used similar to the bank for this program, but you wouldn't necessarily have any ability to change the program's direction. I suspect that the minister and cabinet would have some opportunity to do that, but the way it's set up, they would contact you as they needed funds rather than you contacting them to let them know how the program is working. I'm interested to see the interlock between the two ministries, because I think it's important to see the success of this program. I think the success of this program will be a lot in who is still on income assistance two years from now, and you're the only ministry that's going to be able to tell the Ministry of Education, Skills and Training what's happening.

Hon. D. Streifel: I thank the hon. member for the question, because I'm not shy at all when it comes to discussing this issue with the Minister of Education, Skills and Training or Finance or the Premier's Office or however we work this. The initiatives and programs underway are extremely important, whether it be within Youth Works or any of the other transition-to-work programs -- Destinations, the workplace-based training and all these others. I never, ever miss an opportunity to get my oar in the water with my colleagues in the other ministries to ensure that in fact these programs work -- they're fleshed out, they're fulfilled, they're relooked at when it's necessary, to keep them moving forward. And I'll tell you, the success rate is absolutely phenomenal with the client base these programs are helping and the reason for their existence.

I would refer any interested member not to come to this minister or any one of the government ministers to find out the value and worth of these programs. Go to the folks that are delivering them and listen to what they have to say about them. I think the members would then have no problem at all in agreeing and supporting the value and worth of these programs.

M. Coell: Is the ministry tracking individuals to see how long they stay on assistance once they finish the program, so 

[ Page 4694 ]

that a couple of years from now we'll have a good base of people who were involved in the programs while they were still on Human Resources assistance, and to see what happens to them afterwards? Is there a thorough tracking process of that?

Hon. D. Streifel: In general terms, yes. There is tracking going on from the program deliverers. We don't have a sophisticated tracking program from the Ministry of Human Resources, but certainly the results of the program are being evaluated. We know that in some of the programs there has been as high as an 80 percent success rate in staying at work after the first year. We know that in a large number of cases the jobs aren't the McJobs, as has been referenced many times through one peculiar set of questions -- and question period as well. It was kind of fun for the folks on our side, who had just come off the road from talking to these folks that are now office managers or front-desk managers of hotels, or are working as apprentice upholsterers and working at a computer terminal drafting sprinkler locations for commercial buildings so we can offer fire protection.

I'm trying to equate this to the discussions of the day, but in fact the programs are extremely successful, and we will be expecting that the contract deliverers will be reporting back, in a review mechanism, on the success of the programs and where we're at. Even the employers involved are saying that they've been waiting for 20 or 21 years, in some instances, for these kinds of programs to come about, and they've never been there until now. There's a very keen interest from all sides that this continues, and that we keep an eye on the success rate on behalf of the clients.

M. Coell: The point I want to leave the minister with is that I think it's very important to justify these programs two years from now, because of the huge influx of people into and out of assistance every year. You can have 30,000 people come into assistance and go out, and we're talking hundreds of people here. That could easily be skewed, in the long term, if we don't have proper tracking of those individuals to make sure that it was the program that helped them, not just life circumstances. I think that would help in developing programs like this in the future, if you've got the solid numbers to deal with that.

I'd like to move on to a topic that I think we covered a bit, and that's identification. There had been some talk earlier this year about an identification card, similar to a driver's licence, for people on assistance. There was some talk that it would be a high-tech card that would be very difficult to tamper with. I wonder whether the ministry has considered that or whether it has any pilot projects on the go at this point.

[7:30]

Just one very quick example. An individual after 16 years on income assistance in the system is now out working in an upholstery shop as an apprentice upholsterer. Without the aid of a program like this, that individual tells me herself that she never, ever would have made it out of the system. That's the kind of success we're looking for.

The federal six-week job subsidy programs of the past were no more than teasers to the folks to get them off the system. A few weeks of wage top-up and then being out of work again for an extended period of time is a serious blow to an individual's drive and motivation and self-esteem. Hon. members, when you stand with an individual who says, "Look what's happened to me; finally I'm an example to my children that they can be proud of," and then the tears flow, that's the kind of program that we all must ensure will work and deliver for the purposes it's there for: on behalf of the clients who need and truly want this type of service from us.

A common identifier? We do not have a pilot program underway. If the member is moving down the road to question the recent Ontario strategy, no, we're not going to be fingerprinting or finger-scanning our clients. We rely on a form of identification that's available to us in the community. The need for the identification of individuals goes way beyond the application of income assistance clients in the Ministry of Human Resources. There's a need in other ministries and in other aspects of our lives. If other forms of identification are developed through those processes, I'm sure we would take advantage of them. But we are not leading the parade currently, nor are we planning on starting up a parade of our own on this.

M. Coell: I just have a couple of other areas that I wish to canvass. The minister mentioned earlier today -- and I want clarification more than anything -- the ability of an individual to make $100 over and above their income assistance. In the past, they would have been able to identify that to their workers -- "I made $100" -- and they were allowed to keep it. They had a cheque stub that showed what they did. Now that's changed.

I just wonder whether we could discuss for a moment how that change would affect someone who only makes and only wants to make $100 over and above their income assistance. Maybe that's all they're capable of, for whatever reason. I've had a number of people write. The member from Okanagan, I think, had a person come into their constituency office who was in that circumstance and has now lost $100 off their cheque. For the type of individual who is only capable of earning or only wants to earn $100, do they now lose it? They don't have any gain out of the 25 percent. The minister can correct me if I'm wrong, but that's how I believe that situation would be.

Hon. D. Streifel: This requires a bit of clarification, because the policy isn't the same for every client group. For instance, somebody on disability benefits would have a $200 earnings exemption plus the enhanced earnings exemption above that, so that client wouldn't be affected by this. There's another category where you're allowed to earn $100 -- within the volunteer stipend category, the community volunteer program. There's no effect there. So the main client group that is affected by this is the employable client group base. They could earn a certain amount of money; now they have to earn a lot more to receive that benefit.

There are other exemptions. For instance, for individuals who are on income assistance and who receive income from another source, if it's less than income assistance rates, they keep it all and we top up above that. If it's a top-up on the maintenance program, for instance, of $100 above the maintenance rate, they keep their whole other income. So there are very many categories. I think the member is focusing on just one: the employable category and the loss of exemptions and the move to the enhanced 25 percent structure.

M. Coell: That's correct. That's the group that I wish to zero in on. I think the minister has covered the other groups quite substantially in the last few days.

[ Page 4695 ]

Would I be correct in thinking that the policy, then, is designed to encourage someone to go out and earn a lot more than $100, and if someone does that, they will be able to keep more and earn more? Is that correct?

Hon. D. Streifel: Yes, that's the rationale behind the policy. If an individual can find work and is capable of working, the encouragement would be to earn more money and eventually work off the system. Recognizing that income assistance levels for a single individual are at $500, three days of work, even at a minimum-wage job, produces more money than that in the individual's pocket. So it's an incentive to move into the workforce.

M. Coell: I'm not sure it would be easy to track over a year how many individuals just stopped earning that $100 and stayed on income assistance, and how many actually went and earned more because of the incentive. I just wonder whether there is anything in place to have a look at individuals who are in that circumstance.

Hon. D. Streifel: I guess the review or the research. . . . Research may be a bit strong. I know the members are going to jump on this one and come forward on it: the program of earnings exemptions was not moving folks off the system and into the workforce. As I said earlier in the examination of these estimates, we are now in the process of looking at all the moneys that we earn -- the earnings exemption program, the enhanced program and stuff -- with a view to determine whether or not we're getting the job done as well.

We're dealing in this instance with a category of employable individuals; we haven't had an effect on the disabled folks and others in those categories. It's only the employable group that we're dealing with, and by definition, there should be an ability or capacity to go to work.

From the member's own experience, one of the most valuable tools you can have in your pocket when you go looking for a job is some form of work experience and a work record. With this in mind, if individuals -- as they tell us on a regular and ongoing basis -- have a mind and a desire to go to work, this is one way that work experience can be achieved without fully leaving the income support system and the security that's there.

M. Coell: I'd like to spend some time -- and I know the minister will be pleased at this line of questioning -- on the minister's office, which he's been asking for the vote to be called on in the last few days. I wonder if the number of staff in the minister's office has changed from last year.

Hon. D. Streifel: I thought that the question was a lot broader than that. In my office upstairs here, it's the same number: six.

M. Coell: As I remember, the amount of money for the minister's office was fairly similar to the amount required this year. Could the minister comment on the workload? With the ministry being split and having two ministers and two ministers' offices, what was the increase in workload for the number of staff? Has it decreased or significantly increased?

Hon. D. Streifel: My budget, if it's of any concern, is unchanged from last year. I expect the concern will come back that if we're two-thirds of what we were, why hasn't it changed? But in fact, the work goes on. It's a very, very modest office compared to some. We have two assistants for the minister, then an administrative assistant and two support staff in the office; it's very modest. We're involved, as the members would know, with serving the needs of our clients as well as serving the needs of the other members. If I were to estimate, given the short period of time I was in the full ministry -- I was there from July to September, just over two months -- I would say that our workload is at least equal to what it was in those times.

Given the amount of interest that this minister has in reviewing our programs and how they impact and affect our clientele. . . . So after the split of the ministry, as I said earlier, I've had the time to assess where we are and work with my colleagues and others, and through the process of the estimates, as a matter of fact, to gather information to determine where we want to go. Staff in my office are very busy coordinating some of that for me, with me and through the executive branch of the ministry, as well as serving the needs of the clients on a very regular basis. A tremendous number of phone calls in our office are directly from the client caseload. Questions have to be answered, and it seems like we're there all hours of the day and night, so we're a pretty busy group.

V. Anderson: One thing I wanted to do before was ask the minister if he is aware of the multifaith calendar and has had a chance to use it. We were talking about multiculturalism, and without putting him on the spot, I'd like to present it to him from Multifaith Action and hope it will become a fundamental part of the ministry in the coming year. It has the multifaith services and special days for all of the faiths and cultural groups in the province.

Hon. D. Streifel: With my thanks to the member opposite, I appreciate this very much. I'm really quite honoured and pleased that this was presented to me, and I'll find a place of honour in my office for it.

M. Coell: I'd just like to take this opportunity to wrap up. I think I have had an opportunity to canvass the majority of the new ministry, from its headquarter functions to the core service delivery programs. We've had a look at the bills that were identified in '96, how they've been implemented and a host of individual areas that I had outlined for myself before we got into the estimates process. I have now completed all of those areas that I wished to canvass. I appreciate the time of the minister and ministry staff in being here, and I look forward to receiving the reports that have been offered by the minister.

[7:45]

I thank the members for putting up with some of these ancillary discussions in a good-natured way. I much appreciate the input, the attitude and the professionalism from the folks who took their time to ask me the questions about our ministry. I believe very sincerely that we have an important job to do. Many of our programs are working on behalf of the 

[ Page 4696 ]

clients; many haven't. I hope I've demonstrated in this past short time that I have the capacity to act when action is needed. With that, thank you very much.

Vote 44 approved.

Vote 45: ministry operations, $1,697,070,000 -- approved.

The Chair: I guess we'll take a short recess. That completes these estimates, and we'll see who is up next.

The committee recessed from 7:47 p.m. to 7:56 p.m.

[W. Hartley in the chair.]

ESTIMATES: MINISTRY OF EMPLOYMENT
AND INVESTMENT
(continued)

K. Krueger: I would like to canvass a few questions concerning the B.C. Lottery Corporation first, if that's satisfactory. In the announced gambling expansion, as I understand it, the responsibility for slot machines has been assigned to B.C. Lottery Corporation. I wonder if the minister would confirm that and -- to make it more than a one-word answer -- any other aspects of the expansion that have been assigned to B.C. Lottery Corporation.

Hon. D. Miller: That's correct. They have ordered, I think, 1,000 of the machines and are looking for a longer-term order of an additional 4,000, but they will be responsible for whether those are located in the existing charitable casinos. The other issue -- the destination resorts -- was not nearly advanced in terms of what might be management contracts, but essentially, the Lottery Corporation will be responsible.

K. Krueger: When the minister says that B.C. Lottery Corporation has ordered 1,000 machines, does that mean that the request-for-proposal process has been completed and an actual order has been placed, or is the RFP still approaching its deadline?

Hon. D. Miller: Yeah, I think they've ordered the 1,000 -- I don't know if they've received them yet -- and are looking for longer-term. . . . I think it was a direct order. I'll leave it at that.

K. Krueger: Can the minister tell us, then, who the successful bidder was to provide those slot machines?

Hon. D. Miller: No, I've forgotten. I do have some additional staff people who didn't anticipate we'd start this soon, but they will be here momentarily, I expect, and probably could supply the name of the company.

K. Krueger: In placing these slot machines and taking responsibility for all that that entails, has B.C. Lottery Corporation hired any additional security personnel? What sort of staffing provisions have been necessary to undertake this responsibility?

Hon. D. Miller: I'm not aware that they have directly hired additional security personnel. I would think that the impact would be on the individual casinos themselves. As a result of an incident at one of the charity casinos, there has been a recent evaluation of the security systems, which by and large, I think, stand up to anybody's scrutiny. That's rigorously controlled in terms of the role of the volunteers in the operation and in terms of counting cash, reporting, secure rooms monitored by cameras -- those kind of things. So I don't anticipate that there would be a need for a new system, but rather additional personnel at the locations where slot machines are installed.

[8:00]

Hon. D. Miller: If we could just take a few minutes here, perhaps I could get an answer to the previous question as well.

I'll correct an earlier answer I gave, which was in error. It wasn't a direct purchase; they did go to an RFP. There are three companies short-listed for the 1,000 machines -- IGT, Bally and Williams -- who are licensed to sell machines in Canada. There hasn't been a final determination on that.

The other question: has the Lottery Corporation hired additional security personnel? No.

K. Krueger: If we could just flesh out that second question a bit: as well as or other than security personnel? I wonder if the Lottery Corporation anticipates staffing up at all -- that is, adding additional human resources to deal with the responsibility for slot machines.

Hon. D. Miller: There may be a need. But that's not anything that's happened at this point.

K. Krueger: Could the minister clarify for us what the plan is as far as the installation of these slot machines -- why it's 1,000 now and 4,000 later? We're aware that the 300-machine maximum has been set, as we understand it, for any casino in British Columbia. There are presently 17 casinos. Is there a deployment plan all ready?

Hon. D. Miller: It's a matter of getting out into the market and acquiring machines. The decision was to go for 1,000 initially. They obviously have to shop around in terms of the kinds of machines they want -- those kinds of technical details, which I don't get involved in. So they expect to receive the initial 1,000 in October or November. Beyond that, I'm not certain about an RFP for the additional machines.

K. Krueger: Have the existing charitable casinos in British Columbia had an opportunity to apply? What's the process for them to have a determination as to how many slot machines are placed in their locations? Could the minister outline for us what procedure is in place thus far?

Hon. D. Miller: We don't anticipate that they would. I guess that question is relative to each individual operation: where it's located, whether they have the capacity to put those machines in place, whether they have to move to a different location -- those kinds of questions. None of it has happened 

[ Page 4697 ]

yet. Obviously we don't have the machines. I would anticipate that all of them would most likely want to have the machines in place.

K. Krueger: I take it that no direction has gone out to the casinos as to how they go about letting the Lottery Corporation or the ministry know what their wishes are with regard to the number of slot machines, whether or not they have the room in their facilities, or how many they want. I'm just trying to get a sense of what the arrangement is thus far.

Hon. D. Miller: No, we're not aware of any polling or canvassing of them to see what their position is. But with 17 in operation around the province now, you can appreciate that they're in a variety of locations. It will obviously take time for them to consider whether that's sufficient or whether they need to move; if they do need to move, whether there are questions around zoning -- those kinds of issues. Given that there are many permutations and variables with respect to that, I really can't give you a concise answer to the question.

K. Krueger: The minister referred to the suppliers who are short-listed -- potentially to supply the slot machines -- being licensed to sell machines in Canada. Who does the licensing?

Hon. D. Miller: I hate to say it, but I couldn't tell you. I would assume the feds, but we'll try to check and get back to you. The information is that they're licensed to sell them. I'm not certain.

K. Krueger: I'll take that as an undertaking from the minister to provide me with those details when he's able to flesh them out. He's nodding his head.

When the RFP went out, was it Canada-wide or North America-wide or worldwide? What sort of RFP was it?

Hon. D. Miller: Again, I can't be specific. I assume it went to any company licensed to sell in Canada.

K. Krueger: Might we have the minister's commitment to provide us with a copy of the RFP and the details?

Hon. D. Miller: We'll get that documentation to you, but it only stands to reason that we would make the purchases from companies licensed to sell. There are eight in Canada, so I assume they probably all got the package.

K. Krueger: Will the B.C. Lottery Corporation bear a portion of the installation costs and all the overhead costs of actually putting these slot machines into casinos? Or will the casino operators bear it all? We know that the Lottery Corporation put out the RFPs, but will they own the slots outright? Will they lease them to the casinos, or how will that work?

Hon. D. Miller: The corporation will own them. I think that we will bear the cost of physically moving them into the location, but not anything beyond that in terms of the requirements for expanded space and those kinds of things.

K. Krueger: It occurs to me that we haven't introduced the adviser that the minister has with him from B.C. Lottery Corporation. Perhaps we could do that.

Hon. D. Miller: Ms. Gail White. And on my right is Mr. Lawrie McFarlane, the deputy minister of CCS.

K. Krueger: Turning for the moment to a subject that seems to come up a lot from various people around the province, I don't think there are many criticisms of the B.C. Lottery Corporation, but generally, advertising seems to come up a lot. For starters, maybe we could be advised what the advertising expenditure of B.C. Lottery Corporation was in 1996.

Hon. D. Miller: Maybe I can give a fuller answer than that. The advertising-to-sales ratio is 1.17 percent, apparently one of the lowest in terms of industry standards. In fiscal '96-97, the sales were $860 million and the advertising budget was $10 million.

K. Krueger: Does the B.C. Lottery Corporation have a written policy or guidelines as to what is considered to be appropriate advertising for the corporation in British Columbia?

Hon. D. Miller: To the degree that it is possible, I think they try to be tasteful.

K. Krueger: Of course, taste is a relative thing. I wonder if the Lottery Corporation does any focus-group testing or public opinion polling, or how it determines what would be in good taste for British Columbia.

Hon. D. Miller: Yes, they do.

K. Krueger: How would that be done, then? Is it done on a regular basis with advertisements focus-group-tested before they're used on the airwaves and on television in British Columbia? Are all ads tested with focus groups?

Hon. D. Miller: There has been use of focus groups, and they do really regular tracking of the market to determine how the consumer views a variety of things and, obviously, the variety of types of tickets that are available. It always kind of puzzles me, whenever I'm in a 7-Eleven buying a newspaper or a coffee, to see the vast array of tickets in front of me. There has been the odd time I've been tempted to ask what they all mean, but so far I've resisted. Most major corporations, public and private, as you might expect, track the public's impression of the corporation, the types of games and the advertising as well.

K. Krueger: I have a letter from a person involved in selling B.C. Lottery tickets through her business. She says: "There is a lot of pressure from the corporation to up-sell customers with promises of bonuses for the operators, and of course, the scratch tickets are always prominently displayed on the countertops next to the till." That's just as the minister was describing. I wonder how the Lottery Corporation responds to the allegation that there is a lot of pressure from the corporation to up-sell customers with promises of bonuses for the operators.

Hon. D. Miller: I don't know that that's the case. Really, I think that if there's an individual problem a business has with the corporation and if they feel they're not being treated in a proper way, then certainly I'd like to know about it. But they obviously deal with a lot of sellers, and their mandate is to sell lottery tickets.

K. Krueger: On both these questions -- on advertising and on the RFP for slot machines and, really, with regard to 

[ Page 4698 ]

any type of supplies that B.C. Lottery Corporation needs -- does the Lottery Corporation have a written policy with regard to potential conflict of interest for its employees or managers, as to whether they are involved with suppliers who might also employ relatives of theirs and those sorts of questions?

Hon. D. Miller: Yes, I believe they do.

K. Krueger: I wonder if the minister would commit to provide us a copy of that.

Hon. D. Miller: Certainly.

K. Krueger: Could the minister name for us the three companies that are short-listed on the slot machine RFP?

Hon. D. Miller: I did. They are IGT, Bally and Williams.

K. Krueger: A good memory, but it's short over here. Sorry about that.

Have there been any conflict-of-interest allegations with regard to B.C. Lottery Corporation and its dealings with suppliers in the past couple of years?

Hon. D. Miller: I believe there were some allegations relative to Mr. Simonis. It was an allegation relating to his son, I believe, which through correspondence is absolutely and categorically refuted. And if the member doesn't have a copy of that, I'd be happy to provide it.

K. Krueger: I would appreciate that, and I'll look forward to it. Have there been any other allegations or investigations with regard to conflict of interest at the B.C. Lottery Corporation?

Hon. D. Miller: If there have been, I'm unaware of them.

K. Krueger: The problem of grey machines in the province has been one that has been bandied about for some years now. I wonder if the minister considers the B.C. Lottery Corporation to have responsibilities with regard to dealing with grey machines in British Columbia.

Hon. D. Miller: Any issues relative to provincial statute and violation of that rest with the Attorney General.

[8:15]

Hon. D. Miller: I can't comment on a list, but I am advised that if the B.C. Lottery Corporation are aware of what they consider to be illegal activity, they will not do business with that establishment.

K. Krueger: Have there been any allegations of criminal wrongdoing on the part of any employees or managers of B.C. Lottery Corporation in the past 12 months?

Hon. D. Miller: If there are, I'm unaware of them. I expect that as the minister, I probably would be made aware, but I'm not aware of any.

K. Krueger: Is the minister aware of B.C. Lottery Corporation at any time within, say, the last ten years being obliged to pay settlements to employees who allege sexual harassment on the job?

Hon. D. Miller: I'm not aware of any activities in that regard. I'm not saying there haven't been, but I'm simply unaware of it.

K. Krueger: Could the House please have the minister's commitment to advise me in writing after he has had an opportunity to check the question out on whether that has occurred at the B.C. Lottery Corporation in the last ten years? Could he give me any details that he is able to, as to amounts and the number of people involved?

Hon. D. Miller: I certainly want to provide all information that is relevant to the member in order that he can be informed, but I don't know that I would necessarily readily agree to a fishing expedition. I will certainly make the request of the corporation if there are issues. In one of his questions, the member seemed to focus on the last 12 months.

If there are in fact some issues he wants to canvass here or if he has knowledge of those, I would certainly be happy, if I don't have the answers, to take the questions. The only other thing that might prohibit an absolute disclosure are issues around confidentiality. Not being aware of any of this, I can't. . . . With those minor caveats, I would be happy to inquire of the corporation and to have them contact you.

K. Krueger: I want to reassure the minister that this isn't a fishing expedition. I have received a number of reports of that having taken place, and I think it should be within the public domain -- at least the amount paid out and when, and what sort of action the B.C. Lottery Corporation has taken to ensure that it doesn't happen again -- if those reports are true. I wonder if that sounds reasonable to the minister.

Hon. D. Miller: Well, what sounds reasonable is that I think all firms, whether in the private or in the public sector, should have policies relative to harassment, be it sexual or otherwise, and should enforce those policies.

K. Krueger: I'm willing to wait and see what the minister is able to provide, and we'll take it from there.

There have also been some allegations by owners of pubs and bars, and so on, that a number of them felt obliged to take Club Keno. They were told, according to the allegation I received, that unless they allowed the wiring to be done and accepted that Club Keno would be a reality in their establishments, then if the B.C. Lottery Corporation proceeded into VLTs -- which was, of course, still a question up in the air for many people last fall when Club Keno was announced. . . . They were told that if that happened and they hadn't accepted Club Keno, then they wouldn't get VLTs either, and they'd be left out of a business that their competitors might well be involved in. Could the minister please advise whether there's any truth to that allegation?

Hon. D. Miller: It's very difficult to respond to allegations. There are associations that represent the hotel owners, the Neighbourhood Pub Owners Association. . . . I think I recall seeing some correspondence back and forth with the Lottery Corporation. So I can't respond to allegations. If there's a specific issue that has been raised, then I think the people should be dealing with the Lottery Corporation on that.

[ Page 4699 ]

K. Krueger: With respect to the minister, sometimes the little guy is afraid to deal with the large corporation, whatever it may be. That's the case here. People talk to me, as the gambling critic, because they don't necessarily feel a sense of security in dealing with a large corporation. So these aren't mere allegations; these are statements that these people have made to me.

I would really appreciate it if the minister would ask Mr. Simonis -- it would be nice if Mr. Simonis were here -- and also whoever reports to him who would have knowledge of those activities -- if, indeed, they did take place -- whether, to the Lottery Corporation's knowledge, people were given the ultimatum that if they declined Club Keno, they would also lose out on other opportunities that might be coming down the pipe.

Hon. D. Miller: Well, we're not allowing VLTs. I really think that for the owners of establishments, there is a question of free will. No owner is obliged to accept Club Keno or any other thing they don't want in their establishment. They're perfectly free not to have any of it. I imagine there are some who do; I don't know.

K. Krueger: Yes, that's true, but, of course, the matter of what the competitors are doing is an integral question. The owners might well not expect Club Keno to be a money-making proposition for them and they might not feel it's welcome in their establishment, but. . . . In fact, some of them apparently were in that position, but didn't want to be frozen out from any future opportunities so felt they had their arms twisted. That's the point I'm trying to make.

I wonder if the minister could advise if Mr. Simonis will be with us tomorrow morning and if I might be better advised to put some of these questions when he's present.

Hon. D. Miller: No, I don't think he will. But I would also say -- and I would say this, again, about any Crown corporation within my or any other minister's purview -- that if there are allegations, if there are problems and issues such as the member has been raising, then I would expect that the head of that corporation would make himself available to discuss those issues directly with the member. So I would, on Mr. Simonis's behalf, offer a meeting with Mr. Simonis and my hon. critic, so that these issues can be explored face to face in any venue or, perhaps, in a reasonable venue. If there are issues of concern about confidentiality and if you suggest there's fear, then perhaps talking directly with Mr. Simonis about these may prove to be a better way to go.

K. Krueger: Will Mr. Simonis be made available to us at any time during this estimates debate?

Hon. D. Miller: I thought someone told me earlier he was, but he's not here. I've forgotten.

So, no. I believe he's out of the country, so he's not available. I do apologize; he's not available for this. Well, we're here, and presumably we could continue.

K. Krueger: I'm going to continue my questions, but I'm going to reserve the right to come back to the B.C. Lottery Corporation in estimates when Mr. Simonis is back in the province, because I'm not sure that the minister can actually answer a number of these questions without the president here. We just finished ICBC estimates, and the chief executive officer presented himself and was here throughout. That's actually what we expect when we're doing estimates. I think that particularly in B.C. Lottery Corporation's case, and with the changes that have been announced and the new responsibilities, it makes sense to have the president with us.

So I'd ask the minister if he has any difficulty with giving us the commitment that when I conclude the questions I have of him with the advisers he has present, later on in the estimates debate, when Mr. Simonis can be produced, we may go back and re-cover some of this ground.

Hon. D. Miller: Well, I can't do that. Really. . . . I mean, I'm here, we're here and we are in estimates, and the fact that Mr. Simonis is not with us today should not detract from the estimates process. We have spent a considerable amount of time, I believe, dealing generally with the gaming issue -- a couple of days in the big House. I have offered to the member what I think is an appropriate response -- in light of what are described as allegations with no facts attached to them, which are very difficult to respond to -- which is the opportunity to meet face to face with Mr. Simonis to explore these kinds of questions. So I really don't know that we have a particular problem. I think we should just proceed with estimates.

C. Hansen: Certainly, as we started this whole process of Employment and Investment estimates some weeks ago, we really made the point that we wanted to be as cooperative as possible in terms of sequencing, that I understood that. . . . We didn't know how long the estimates for the Ministry of Human Resources were going to go in this room. Therefore we fully understood that perhaps some of the officials with the B.C. Lottery Corporation who reside in Vancouver, who have their offices in Vancouver, would not be here tonight, but that we would be able to deal with some of the specific issues, especially involving finance -- which I gather is Ms. White's specialty. I may be wrong there, but I just knew that we could specifically address finance issues and get through some of this stuff until such time as some of the other officials might be available. We are prepared to be cooperative on that, but if you're now telling us that Mr. Simonis is not going to be available at any point during these estimates, I just find that to be unacceptable.

I guess, perhaps if we were to push through as many of the questions as we can tonight and then. . . . Maybe it's best if we go on to another Crown corporation tomorrow and come back to the issues of B.C. Lottery Corporation -- perhaps when Mr. Simonis is available, because I think a lot of the questions are very specific and require his input. Could the minister comment?

Hon. D. Miller: I fully anticipated that it would take about half an hour to an hour to get through these estimates. I didn't realize. . . .

S. Hawkins: Ever the optimist.

Hon. D. Miller: I certainly don't want members getting excited here now, because you notice that I'm being pretty low-key these days.

Look, I'll make some inquiries to see if we can get Mr. Simonis here. I didn't think the thing would run past tonight, but you surprised me again. But fire away. If you've got questions, we'll try to answer them.

[ Page 4700 ]

K. Krueger: I wonder if the minister could advise us what the B.C. Lottery Corporation spent on the legal action against the city of Vancouver with regard to their by-law concerning Club Keno machines.

Hon. D. Miller: No, I don't have the detailed breakdown. There may be ongoing costs associated with that. It's hard for me to estimate what the price of lawyers is.

K. Krueger: I'm becoming increasingly puzzled as to what the point is of having estimates when the minister can't give answers and the man who presumably could give the answers isn't with us. I guess we'll press on, but I may well be asking all these same questions again. B.C. Lottery Corporation estimates could take half an hour, I suppose, or they could take half a month, or they could take half a summer, because. . . .

S. Hawkins: It could take half a year.

K. Krueger: My colleague says it could take half a year, and that's the case. There is no end of questions that could be asked. . . .

Interjection.

K. Krueger: The minister says that my colleagues would be mad at me. I have to tell the minister that I wouldn't be thrilled myself.

S. Hawkins: We love it here.

Interjections.

The Chair: Order, members.

K. Krueger: Those are the heavy weights of responsibility that fall on these shoulders.

I'd like to ask the minister -- and perhaps Ms. White could help with these questions -- whether we could have a global number for the amount that the B.C. Lottery Corporation spent on travel for its employees in 1996.

Hon. D. Miller: No, I don't. . . . Mr. Chairman again I'm a bit perplexed. I don't know if there are issues that we're talking about. I can understand a series of questions about trying to get facts, those kinds of minutiae that in the scheme of things mean nothing. But are there issues that the member might want to explore about the Lottery Corporation? It seems to me that this is the opportunity to do that. If there are minutiae -- details -- like how many cents are spent on stamps or something, I'm sure we could find somebody -- although it would probably cost us money to find it -- to get the number. The question is a bit arcane, but I'm sure we can probably find some estimate somewhere. I'd be happy to forward it to the member.

Is there a particular issue around travel that's a concern? Then let's get at that, and we might be able to have a more productive discussion.

[8:30]

Surely the B.C. Lottery Corporation is a major economic player in this province. Vast sums of money roll through its hands, and great numbers of people are involved. The staff work under various arrangements with the employer -- so do the suppliers; so do the various small businesses. If now isn't the time to ask these questions, then I wonder what the appropriate time is.

So we'll start with a much-larger-picture question, then. How much is the gross revenue of the B.C. Lottery Corporation? How much was it in 1996?

Hon. D. Miller: It was $867 million.

K. Krueger: According to the auditor general's report, at the end of the day for 1996, of that figure the B.C. Lottery Corporation turned over $244 million to general revenue. Is that correct?

Hon. D. Miller: I have $265.86 million.

K. Krueger: That alone is interesting; $21 million is nothing to sneeze at. It's on the good side of the ledger, but that's good to see. I'm interested, and I'm sure the public is. In fact, I know they are, because I get inquiries from people all the time, people who are suspicious about everything, right down to whether the draws are really happening now that they can't see them on television anymore. People ask about all of these things.

But in some way we get from $867 million revenue, funds coming out of the economy of British Columbia, down to $244 million net. Nobody is challenging that there's anything improper there, but we need to discuss at least some details of how we move from the larger figure to the smaller one.

Certainly the B.C. Lottery Corporation has management policies and decides things like how much it's going to spend on travel, how much it's going to pay its managers and what sort of perks they get. Again, if this isn't the time to canvass those issues, I don't know what time is, so we'll move on to that.

Hon. D. Miller: Again, I do appreciate. . . . The member has made comments about allegations by various unnamed parties. He has now stood and suggested that in fact the draws don't really take place. It reminds me of a movie, The Parallax View, I think it is, where they didn't really send men to the moon. I understand a little bit of the nature of conspiracy theories, but that's a bit too much.

I would say, however, that the corporation is subject to the normal processes of auditing and scrutiny, and I have never heard a suggestion that things are fixed. The reporting of income is a matter of public record. It's available to all, both to members and to members of the public, and I really find some of the suggestions rather strange. All those numbers are a matter of public record.

K. Krueger: If the minister will read the record later, he'll see that I certainly didn't allege that. I said that the public has all sorts of questions.

I consider it my responsibility as critic to ask the questions I have been asking. When I ask the minister what the 

[ Page 4701 ]

B.C. Lottery Corporation spends on travel for its employees, I intend to find out. He has an obligation to produce people who can tell me, who can answer those questions. We're going to continue along those lines, and if the minister wants to come back to this another day when he has people with him who can give me some detail, then we shall. We may anyway, especially if I continue to get the answers I'm getting so far tonight.

Some people have the impression that the budget is spent fairly freely in some of our Crown corporations, and I'd like to provide answers to the public when they ask me about the area for which I am responsible as critic. Will the minister find out for me what the B.C. Lottery Corporation spent on travel for its employees in 1996?

Hon. D. Miller: In judging the operation of any corporation, there are normal standards that are generally applied in terms of the administrative cost, those kinds of approaches. If the member is asking that we produce an absolutely faultless document with respect to every single piece of travel undertaken by every member or employee of the corporation, I'm not certain that it's that readily available or what form it's in. It may take some work; we may have to spend some money in order to do that. I'll have to take the question under advisement.

If it's readily available, if it's there, then certainly we would give it to the member without hesitation. We have nothing to hide. If I knew down to the last cent the travel dollars for every single employee of the Lottery Corporation, I'd be throwing it out here with abandon. But we don't have it here, and I don't know that it's generally germane.

The operating expenses are described. They are available, again, for the member's scrutiny. We do occasionally spend more money than we're obliged to because we think it's in the public interest. The member is aware of that. I don't know whether he considers that a foolish expenditure or one that was worth the extra $2 million. He might like a comment on that.

There are lots of things that any corporation does. They have to meet objective standards and tests. They're subject to scrutiny by the Legislature; they're subject to the auditor general. They're probably subject to Public Accounts. So if the information is at hand and if it doesn't cost a lot of money to try to get it, then I'd be happy to give it to the member.

K. Krueger: Thus far no one has asked for the kind of minutiae, as the minister put it, that he's referring to, nor have we asked for that exact an accounting.

Surely a corporation the size of the B.C. Lottery Corporation has a budget and a management process for things like travel time. It should be a line item in the budget, and I'll take that as a commitment from the minister to answer that question. I'd like a breakdown as to what is travel in British Columbia, how much is travel in Canada outside British Columbia and how much is international travel.

I wonder if the minister could tell us if the corporation has any written guidelines on under what circumstances its employees or executives travel outside the country. And does it have a detailed reporting arrangement so that sort of expenditure can be tracked by the ministry -- or by the opposition?

Hon. D. Miller: As I said in my last answer, we will attempt to get as much information as we possibly can for the member.

K. Krueger: We've canvassed the question of whether the minister anticipates any increase in staff to deal with the new responsibilities for gambling expansion, and he has said no. Did the B.C. Lottery Corporation experience an increase in staff in 1996 over 1995?

Hon. D. Miller: I believe the number is 367.

K. Krueger: That number would be the number of staff employed in 1996.

Hon. D. Miller: Yes.

K. Krueger: Could the minister tell us how many of those staff are managers?

Hon. D. Miller: Approximately 30.

K. Krueger: The Kamloops location of the B.C. Lottery Corporation is designated as the head office of B.C. Lottery Corporation, as I understand it. Is that still the case?

Hon. D. Miller: Yes.

K. Krueger: Could the minister tell us: of the 376 employees, how many are in Kamloops, how many are in Richmond and how many are in Victoria?

Hon. D. Miller: There are 180 in Kamloops, 150 in Richmond, and do the math and you get the rest.

K. Krueger: One of the reasons that question was asked is that there is a great deal of toing and froing between Kamloops and Richmond, and there have been quite understandable questions about the efficiency of that. If Kamloops is the head office of B.C. Lottery Corporation, but the Richmond office has almost the same number of staff, one wonders why those staff aren't employed in Kamloops. I know that the Lottery Corporation has spent some money in the past preparing to answer that question. I wonder if the minister could tell us what documents are presently available that answer that question.

The minister looks puzzled. The question is: why, if Kamloops is the head office, is almost the same number of employees located in Richmond? I'm asking whether the B.C. Lottery Corporation have some documents that explain why that makes sense to them and any independent assessments by experts who have given them an opinion about whether they should continue in that mode.

Hon. D. Miller: I'd be happy to see if there is anything, but I would anticipate that it's the marketing arm. I suppose if that weren't the case, the travel budget might be higher.

K. Krueger: The point I'm making is that I think the travel budget may be higher because of that. When the corporation responds that it needs to have employees in Richmond to deal with marketing companies and so on, I suggest to the minister that those marketing companies would come to Kamloops or anywhere else that the B.C. Lottery Corporation wanted to do business with them.

It's my understanding that B.C. Lottery Corporation has actually procured studies on this question of whether or not it should consolidate the head office. I see the minister nodding his head. Perhaps he could tell us what he's learned. That is, I 

[ Page 4702 ]

am asking the minister if he is aware of any studies that the Lottery Corporation has commissioned or spent money on examining this question of where its employees ought to be.

Hon. D. Miller: I'd like some assurance that the members from Richmond aren't going to come at me from the opposite direction at some point. The member is advocating taking jobs out of Richmond and moving them to Kamloops, which is commendable in terms of the regions.

There was a report in '91 by Ernst and Young in terms of the organizational structure. They determined that everybody is in fact where they ought to be.

K. Krueger: Is that the most recent report of that nature which the minister is aware of?

Hon. D. Miller: Yes.

K. Krueger: Would the minister undertake to ensure that there haven't been any subsequent reports, and if there have, to provide them to me?

[8:45]

K. Krueger: Did the report that the minister just referred to, the 1991 report, indicate that there would be any savings at all if the entire operation was consolidated in Kamloops?

Hon. D. Miller: The report concluded that the distribution of employees made sense in terms of the operation and the function of the operation, so there was no reason to look at any changes. The marketing and sales are in Richmond. That's where most of the customers are, and it appears to make some sense in terms of the rational operation of the corporation.

K. Krueger: My colleague from Richmond Centre has some questions with regard to advertising.

D. Symons: I would be tempted to ask the minister to move the whole operation to Richmond, but that wasn't the direction of the questions I was going to ask.

The question that I was going to ask dealt with advertising and the direction which the advertising takes. I don't watch a great deal of TV, but I see some, and I hear the ads on radio quite often. The ads, to me, are sort of offensive in the sense that they seem to be projecting that your chances of winning are pretty good. In most cases, people are ecstatic over having won. All you have to do is buy a ticket, and you will become an instant millionaire or hundred-thousandaire or whatever. You will become the heir to a large sum of money, in any case.

I was thinking that if we were to do the same sort of advertising on cigarettes, we'd all be up in arms. We'd say: "That's terrible; you're encouraging people to go out and buy cigarettes." But we don't seem to think it's such a problem when you're inviting people to go out and squander their money, in a sense, on gambling, because basically that's what you're doing.

When you put on the ad for that, you don't put on the screen what we require on cigarette packages as to how it's affecting you. You don't put on the screen what your chances of winning are. If you have one chance in 15 million of winning the big prize, let's say so on the screen so that before they get ecstatic about the fact that gee, look, I can be a great winner, people can realize what their chances of being a great winner are. Why don't you advertise honestly in the sense of saying what your chances are if you're indeed going to advertise in the way that you are?

I guess the ground I'm coming from is that what you're trying to convey to people is that through the purchase of a lottery ticket, rather than through effort and work, they're going to become wealthy. Somehow I would like to think that we are putting it out there to the young people and to the people of this province that there's a work ethic in this province, that you work for something rather than sit back and hope that you might win on a lottery ticket.

Hon. D. Miller: I appreciate the sentiment. It's exactly the one that I've stated on numerous occasions. But you know, there's a reality in the world as well. Prior to lotteries, people were buying Irish sweepstakes.

The decision was made at the federal level quite a number of years ago, actually, and agreed to by the provinces, to allow the implementation of lottery ticket sales in Canada. I grew up at a time when they weren't allowed, but I think I used to buy the odd Irish sweepstakes, which technically was illegal, as I understood it, in those days.

While I do appreciate. . . . Realistically, is the member suggesting a wind-down of the corporation? I don't know. It seems to be almost inherent when you're selling a product that you sell it. It's not very often when somebody is selling something that they have a campaign directed at encouraging people not to buy it. The lottery revenue is an important source of revenue for the province. It does provide an offset on the general revenue side and goes into key areas of health care. Fifty percent of those revenues goes into the health special account.

It's interesting to note that Newfoundland did ban the use of advertising for lotteries in '92. The result was an escalating loss over a three-year period that mounted and got greater every year. At the end of the three years they reinstated advertising, which shows you a couple of things, I suppose: that the moral question occupies all political parties. . . .

I think it's reasonable that they do advertise the product. I think the consumers are generally aware of what they're buying; I don't think anybody is kidding themselves that they're going to win every time they have a big prize. I'm amazed at the extent that people actually do buy lottery tickets, but they do that of their own free will. In terms of the balance of the moral view versus the right of the public to engage in activities that are legal -- even if they don't have much of a chance of winning -- I really think you've got to put some faith in the public. So I do appreciate the member's sentiments, but we have no plans to change the promotion or the advertising of lottery tickets.

D. Symons: Just one last little kick at the can, so to speak. I wasn't saying that we shouldn't advertise and say in one sense that the product is available. It was the thrust of the advertising I was concerned about and, as I said, the hype around the possibility of winning. I guess the distinction is that for Disney or some other corporation like Mattel to be selling their toys to children, or Old Spice to be selling the chance of getting that woman if you wear the right stuff, these are commercial products. It's a little bit different. . . .

Interjection.

D. Symons: Yeah, I found it never worked, either, but that's beside the point.

[ Page 4703 ]

It's a little bit different, I think, when the government is doing it. That's my concern. It's bad enough when the private sector is out there, using the weaknesses of people as a gimmick for selling their product. But I think it's a little bit worse when the government does it. That's my concern.

Hon. D. Miller: When we canvassed gaming in the big House and talked about the moral questions involved, I believe I responded to one of your critics on that score. I think everybody grapples with these kinds of issues, and clearly the member has, in my view, exhibited a very strong social conscience.

C. Hansen: I just want to follow up on that. Certainly, if you go back a few years, there was a very different tone to the advertising that was done. When the B.C. Lottery Corporation first started marketing lottery products in British Columbia, the advertising had a very different tone to it. It was focused on the charitable uses of the profits; it was focused on the B.C. Summer Games and the B.C. Winter Games; it was focused on health care issues. I'm wondering if the minister could tell us why the advertising policy of the corporation has been changed.

Hon. D. Miller: I don't think there's been any change of policy. Advertising always develops; people are always looking at different ways to market. I don't think there's been any change in policy.

C. Hansen: Certainly I think anyone who's followed the advertising over the years has seen a very distinct change in the flavour of the advertising that's been done. Initially, it was there to meet a demand; the lottery products in British Columbia were there to meet the demand. Now government has assumed the role of creating that demand through its advertising. I wonder if the minister could tell us if the tone of the advertising is decided solely by the full-time staff of the corporation.

Hon. D. Miller: No, I believe the board. . . . Obviously the corporation has a board. They don't involve themselves in the day-to-day affairs, but policy questions are determined by the board. I did have a brief conversation with Patrick Chen, the chair of the board, some time ago about advertising and whether. . . . His question to me was: "Do you think we should start putting in more of the link to the money that goes to health care?" And I said: "I think that would be something you might want to examine." But I don't direct them, either, in terms of their advertising program. I happen to get a kick out of Leslie Nielsen, just because I think he's a funny guy, so I'm one of those. I don't really watch; someone said earlier you don't watch TV. I'm unaware of the advertising because I just kind of tune it out, but I've been watching lately, because Leslie Nielsen cracks me up. Even if I've seen it ten times, I still give a little chuckle.

[P. Calendino in the chair.]

C. Hansen: Could the minister tell us: is there an annual advertising plan that is put forward from the corporation for approval by the board of directors?

Hon. D. Miller: I did indicate, I think, in an earlier response that the ratio of advertising dollars to gross sales was something like 1.17 percent, which apparently is one of the lowest compared to other lottery corporations across the country. The corporation does buy a year at a time. They receive pretty favourable rates, about a 25 percent saving, as a result of doing that. I guess there's a lot of money into the sort of jackpot alert whenever that prize gets to be quite large. Then there's the kind of ads that you've mentioned -- I'm not familiar with them -- and the most recent one, the Leslie Nielsen ad. Total expenditures on advertising draws and promotions: $16.3 million.

C. Hansen: I do want to come back to the $16.3 million that the minister just mentioned. Could the minister tell us: in terms of the advertising that is placed by the corporation, is it all placed through one agency? Or is it divided up at all?

Hon. D. Miller: The corporation, I guess, goes for RFPs periodically. The current agent of record is Scali McCabe Sloves. There may be some other minor contracts -- professional services, Dunn Communications, for the production of Luck Magazine and "Luck Radio" -- in other words, for those kinds of services that are attendant on, I guess, that sort of business.

C. Hansen: Earlier, when we first asked about the advertising budget and when he first mentioned this ratio of 1.17, he mentioned that there were. . . . His numbers at the time were $860 million in sales, and he mentioned $10 million in advertising. Now he's used the figure of $16.3 million in advertising. I wonder if he could explain the difference between that.

Hon. D. Miller: I did say "advertising draws and promotions" for the $16.3 million. I guess that's the breakdown.

C. Hansen: Could the minister confirm. . . ? Does that $16.3 million include all of the communications budget for the Lottery Corporation? Or are there other elements to a communications budget?

Hon. D. Miller: No, that would be substantially communications. I don't know if there's other. . . . But yeah, I would say that it's communications as well.

G. Abbott: I'd like to briefly explore a couple of questions which arose from the estimates debate for the Minister of Small Business, Tourism and Culture, and in particular the community grants branch or division of that ministry. I understand that she, in fact, deferred to you on a number of occasions as the minister responsible for B.C. 21 and the minister responsible for the administration, in large measure, of the community grants branch.

I sense a look of puzzlement there. Am I or is she missing the boat, or. . . ?

Hon. D. Miller: I thought we were doing lotteries, but. . . .

G. Abbott: Perhaps I leaped too quickly to introduce the topic. It might be appropriate at this time to do it. What we are ultimately interested in here is the disposition of lottery revenues through B.C. 21 community grants.

Interjection.

G. Abbott: B.C. 21. . . ? No?

[ Page 4704 ]

[9:00]

K. Krueger: To follow up on what my colleague from Shuswap was asking. . . . Prior to the New Democratic Party forming government in 1991, the Social Credit Party disbursed funds from B.C. Lottery Corporation profits to community grants. Considerable confusion exists around the province and, apparently, in the mind of the Minister of Small Business, Tourism and Culture as well, with regard to who is really responsible for where the money comes from for B.C. 21 grants. Now, my understanding is that the profits of B.C. Lottery Corporation are funnelled into general revenue with 50 percent earmarked for health care. I'd like the minister's confirmation of that.

Hon. D. Miller: Yes, I did state that earlier.

K. Krueger: At least the minister stated part of that. He referred to the health care allocation, I believe.

Is the minister telling the member for Shuswap and all others who still wonder about this -- because it is confusing for people, apparently even for the minister's immediate colleagues in cabinet -- that he has absolutely no involvement or jurisdiction over B.C. 21 funding and that there is no allocation of gaming revenues, of B.C. Lottery Corporation profits or the like, to community projects or for community grants applications of any kind?

Hon. D. Miller: There's no connection between lotteries and the community grants. I do have a role to play with respect to community grants, but not as a result of being the minister responsible for lotteries.

K. Krueger: I appreciate the minister saying that. Perhaps just for the moment we could deviate from B.C. Lotteries, then, and the minister could just explain, for the edification of everybody concerned, what his role is with regard to B.C. 21 and community grants.

Hon. D. Miller: I chair the advisory committee of MLAs that looks at the applications that come in, in consultation with staff. It makes recommendations to cabinet.

K. Krueger: Just to be painfully clear about this, then, the only connection presently in the structure of things between B.C. Lottery Corporation, or gaming revenues of any kind, and the B.C. 21 program is that gaming and B.C. Lottery Corporation raise funds that go into general revenue, and some of that may be allocated to B.C. 21, like any other program. But there is no other connection between gaming and that program, the former community grants or the present community grants program?

Hon. D. Miller: No, government obtains revenue from a variety of sources -- stumpage. . . . It would be like saying to the Minister of Forests: "Does part of that stumpage revenue flow to a particular program?" You have to deal with the program and the minister responsible for the program.

K. Krueger: Certainly that's what we're trying to do. We're just trying to make it very clear for the record, and for the many people who don't understand it, that that's the way things are now.

Going back to the question of how the B.C. Lottery Corporation has dealt with the city of Vancouver on the Club Keno question and how the B.C. Lottery Corporation will deal with municipalities who might resist installation of slot machines in charitable casinos or any other type of casino. . . . Does B.C. Lottery Corporation have a written plan or does the B.C. Lottery Corporation have any minutes dealing with the issue of how the corporation will deal with municipalities if that situation arises?

Hon. D. Miller: We canvassed this fully in the gaming portion of the estimates, over a couple of very fruitful days. I believe I answered that question probably half a dozen times during that fruitful couple of days. I'll give it one last shot. I would hope, with all due respect to the process, that we're not going to be repetitious too often. I did indicate at the time that in terms of the legal obligation, the municipalities don't have legal authority over gaming. It rests with the provincial government, and through that, the Lottery Corporation. The result of the decision by the city of Vancouver to try to prohibit the installation of Club Keno machines in bars is well known. It's public; it resulted in a court case. I believe there may be some ongoing issues in that court case, so I don't want to get into details on that. That will be the position that the Lottery Corporation takes. If people, or entities like municipalities, attempt to exercise jurisdiction where they don't have it, then the consequences are pretty clear.

K. Krueger: Back to my question, then: does the B.C. Lottery Corporation have written guidelines as to how it's going to deal with municipalities in that situation?

Hon. D. Miller: I just told you what they would be.

K. Krueger: I know very well what the minister just told me, but he did not answer my question as to whether there are written guidelines that the B.C. Lottery Corporation is to follow in dealing with municipalities. Would he please answer that?

Hon. D. Miller: Well, he could copy this down. I've answered the question, as I said, on a number of occasions in the large House, in the other part of the estimates. I did indicate that if jurisdictions, like municipalities, attempt to exercise jurisdiction which they do not legally have, then the Lottery Corporation will take whatever steps are necessary from a legal point of view to deal with that.

K. Krueger: I have no need to copy down anything that the minister says; Hansard certainly does that. I would like the minister to answer, yes or no, whether there are written guidelines published already for the B.C. Lottery Corporation as to how they're going to deal with municipalities. I'm not asking for the minister's verbal rendition of what he thinks will happen; I'm asking whether there are written guidelines, a document that sets out the B.C. Lottery Corporation's intention when this issue comes up. If a municipality says, "We don't want slot machines in our casinos," it's already clear what the minister wants to happen. Has that policy been documented to, through or by the B.C. Lottery Corporation?

Hon. D. Miller: I'm puzzled. If a municipality attempts to exercise jurisdiction when it doesn't have the legal authori-

[ Page 4705 ]

ty to do that, then in the case of Club Keno -- which illustrates the issue perfectly -- the Lottery Corporation will take steps. Would the member suggest that they do anything else? If the law is not being followed, should they turn a blind eye? It's pretty straightforward: municipalities don't have that jurisdiction. The city of Vancouver case is there for all to see. No, it doesn't require. . . . Now, maybe there are some documents somewhere else; I don't know. It's immaterial.

K. Krueger: The minister appears to feel that it's appropriate for Crown corporations, even $876-million-per-year Crown corporations, to take a fly-by-the-seat-of-the-pants attitude on how they do their business, the same as he's done in the whole matter of gambling expansion. But the rest of the world doesn't think that's appropriate. Perhaps we could go back to the whole mandate of the B.C. Lottery Corporation. What is the current mandate of the B.C. Lottery Corporation?

Hon. D. Miller: For a guy who stood up and lobbied that we award a contract to a company in his hometown, the questions are getting kind of crazy: "What's the mandate of the Lottery Corporation?" Next thing you know, he's going to ask for some written guidelines. I mean, let's get serious here. This is kind of silly.

Interjections.

The Chair: May I remind the members to. . . . Would members keep order in the House, please.

K. Krueger: Thank you, hon. Chair, for silencing the rude behaviour of the member for Alberni.

I asked the minister a straight question. Surely the B.C. Lottery Corporation has a written mandate. What is it?

Hon. D. Miller: The mandate. As the major advocate of gaming policy and the principal operation, the objectives are: to maximize gaming revenue to the province of British Columbia; to be a responsible, trustworthy and progressive corporation and to be recognized by the public as such; to achieve strong and broad-based public support for the corporation's mandate; to have the best retailer network in the province of British Columbia to serve and meet the needs of our players; to achieve a workforce that at all levels reflects the diversity of the British Columbia workforce; and to seek to ensure that every employee is valued, professionally fulfilled and feels that they can play an integral role in the success of the corporation.

K. Krueger: Although that was obviously painful for the minister, that's the way the business world does business in the late 1990s. Does the B.C. Lottery Corporation have a set of written goals building on that mandate?

Hon. D. Miller: There's a business plan.

K. Krueger: Could the minister give a commitment to give the opposition a copy of that business plan within the next week?

Hon. D. Miller: Sure.

K. Krueger: Every ministry of the British Columbia government, as I understand it, and every Crown corporation is expected to have a set of measurable goals and to let the minister responsible for the ministry or the Crown corporation know how they're going to measure those goals. So are those details provided -- the specific goals and how they can be measured -- in the business plan?

Hon. D. Miller: They must be -- I hope not like the goals outlined by the member before we came into these estimates. Yes, I'm sure they will be.

C. Hansen: Has he read it?

K. Krueger: I think the question that was just asked is a fair one. I will repeat it on the record: has the minister read the business plan of the B.C. Lottery Corporation?

Hon. D. Miller: I'm satisfied with the plan.

K. Krueger: Has the minister responsible for the B.C. Lottery Corporation read the business plan of the B.C. Lottery Corporation?

Hon. D. Miller: No.

K. Krueger: Perhaps someone will write a book when this term of the Legislature is over. It will be a biography of the minister: Getting to No.

Hon. D. Miller: When you're here long enough, you realize that some things are important and some aren't.

K. Krueger: The minister said: "When you've been here long enough, you realize that some things are important and some aren't." Some people think the minister means that reading is not important, and I think the minister means that reading the plans of the $876-million-per-year B.C. Lottery Corporation, when he's the minister responsible for it, isn't important. Apparently that's what he means; he is nodding his head.

The B.C. Lottery Corporation, then, in the mandate that the minister read out, has to maximize gaming revenue to the province. Surely, to maximize gaming revenue, it's important for a corporation to have tight control over its expenditures and all the things that draw down the gross revenue that the B.C. Lottery Corporation enjoys, because if they don't have a tight plan for those things, they won't be maximizing gaming revenue. So we will return now to some of the questions from a little bit earlier with regard to how the B.C. Lottery Corporation spends its money. The minister has already committed to give us a breakdown of travel expenditures. Can the minister give us an outline of the pay that is provided to the senior executives of the B.C. Lottery Corporation?

Hon. D. Miller: It's a matter of public record.

K. Krueger: Well, it may be a matter of public record. I would like the minister to give it to us on the record or undertake that he will give it to us in writing within a week, and that it will be a list of the Lottery Corporation's management team and also his advice as to any related benefits of being on the management payroll of the B.C. Lottery Corporation.

Clearly the issue of leased cars and luxury cars has been an issue in other Crown corporations recently. I would like to know how many Saabs, Mercedes, Jaguars and whichever type of vehicle the B.C. Lottery Corporation provides to any of 

[ Page 4706 ]

its employees for personal use, and also the details of any other perks, for lack of a better term, or benefits that these people enjoy. Could the minister provide that to us?

[9:15]

We can send someone to help the member go through the documents, but we're not going to write letters about issues that are public. If you want copies of the public accounts and those kinds of documents, they are readily available. I'm sure that someone in your caucus research knows how to get them, but I'm not going to waste the time of the public duplicating work that's already there.

K. Krueger: Do you know where they are? Can you tell us where we can procure a list of what vehicles are provided to B.C. Lottery Corporation managers and employees for their personal use?

Hon. D. Miller: I can tell you one thing: if I want them, I know how to get them.

K. Krueger: Since the minister has said that, can he tell us exactly where to go for them? He has an adviser on each side of him. There's really no need for these glib and confrontational answers. Where is that information available?

Hon. D. Miller: I think in general I'd describe public accounts and those kinds of things. The information is available. If the member is having trouble, it's not for me to assist him in his research. He has an adequate research staff, funded by the taxpayers. Presumably they do serve the members' interests, and I think that if you go to them, you'll probably get your answers.

K. Krueger: The minister, I believe, is mistaken. The public accounts don't have a list of the perks or the vehicles that are provided to B.C. Lottery Corporation executives. Is the minister certain that the public accounts have that, and if not, will he give us an undertaking to provide it to us?

Hon. D. Miller: Yes.

K. Krueger: I'm getting some input from my colleagues that the minister might enjoy a five-minute break. Is there any basis to that? The minister is shaking his head. Has the minister undertaken any comparisons between the B.C. Lottery Corporation and other Crown corporations to see whether the management salaries and benefits that are provided are in line with other Crown corporations?

Hon. D. Miller: Yes.

K. Krueger: What was the result of those comparisons?

Hon. D. Miller: They are in line.

K. Krueger: It's my understanding that the B.C. Lottery Corporation has never made a contribution to funding for assessment and treatment of gambling addicts in British Columbia. Is that correct?

Hon. D. Miller: I believe it is.

K. Krueger: Will the future of the B.C. Lottery Corporation include shouldering some of that responsibility, since there is presently close to a 4 percent rate of gambling addiction problems in British Columbia? Or is the $2 million per year that the minister has committed for funding these issues just coming from the gambling expansion revenues through casinos?

Hon. D. Miller: That rests with the Ministry for Children and Families. They'll be running the program.

K. Krueger: The B.C. Lottery Corporation has certainly done several surveys through the Angus Reid organization with regard to the prevalence of gambling addictions and the problem of pathological gambling in British Columbia. I'm aware of one in 1993 and one in 1996. Is the minister aware of any others?

Hon. D. Miller: We canvassed these issues extensively, repetitiously, for two days. I think we've done enough with respect to that issue, and I fully appreciated that that was the sentiment of the opposition, as well.

K. Krueger: The minister deals with B.C. Lottery Corporation estimates in isolation of other gaming estimates, as I understand it. With no wish to be repetitious, I request that he answer the question with regard to B.C. Lottery Corporation.

Let the record show that the minister refused to answer or to rise from his seat.

Would the minister please advise us which company supplied the Club Keno equipment and is the ongoing supplier for Club Keno equipment?

Hon. D. Miller: Gtech.

K. Krueger: Is that equipment still owned by Gtech? Or what is the ownership of the Club Keno equipment?

Hon. D. Miller: Owned by the corporation.

K. Krueger: Does B.C. Lottery Corporation own the Club Keno equipment 100 percent?

Hon. D. Miller: Yes, hon. Chair.

K. Krueger: Not too long ago, the B.C. Lottery Corporation undertook renovation of its offices at 10760 Shellbridge Way in Richmond. Can the minister tell us what the cost of those renovations was?

Hon. D. Miller: No. I don't have the figure.

K. Krueger: Can the minister commit to telling us what the figure was and to giving us an account of how it was spent?

Hon. D. Miller: I'm sure I can get the corporation to do that.

[ Page 4707 ]

K. Krueger: I'm a bit puzzled, because I know that the British Columbia Lottery Corporation has provided briefing notes to the minister for that question and others that I've asked. I wonder if he hasn't had the opportunity to read his briefing notes.

Hon. D. Miller: That's correct, hon. Chair.

K. Krueger: The minister is laughing jubilantly at his last response. Before he wastes the opposition's time or the House's time, I would suggest to him that in future he should read his briefing notes before he engages in estimates. In my mind, this is disrespectful to the people of British Columbia, to the Members of the Legislative Assembly and to the assembly itself.

I understand that the B.C. Lottery Corporation commissioned a public opinion study with regard to how people feel about Club Keno being sold in licensed premises. Is the minister familiar with that study and its results?

Hon. D. Miller: The member asked for the results. Is that correct?

Of respondents in the lower mainland, 62 percent feel it's acceptable to be sold in bars and pubs; 85 percent agree that people should have the freedom to choose the games they want to play. When presented with a set of lottery games, the majority found Club Keno to be most similar to Lotto 6/49.

K. Krueger: Another of the briefing papers that B.C. Lottery Corporation provided to the minister happens to discuss this member -- and I have the issue title, which is "Social Costs of Gambling Exceeds Revenue." I have the background that the minister was given in his briefing paper, which is: "A review of several studies on the social costs of gambling was commissioned by the Liberal gaming critic. The review was completed by Dr. Julian Somers, clinic director, department of psychology at UBC." This is a quote, and is certainly not something I agree with: "The paper draws conclusions from a variety of studies, making it somewhat convoluted." It goes on to say: "It also suggests the establishment of some type of prevention and treatment program."

Does the minister have any views of his own, or would he share with us the views of the B.C. Lottery Corporation, as presented to him in the briefing note in this regard?

Hon. D. Miller: Again, we debated and canvassed this issue repetitiously for two days. It's clear, from my recollection of that discussion, that there are a variety of viewpoints on the question of addiction. There is not one definitive piece of work. Quite frankly, in some cases it's a matter of opinion and conjecture. I don't know that we ought to revisit that.

[W. Hartley in the chair.]

K. Krueger: We're dealing with the estimates of a major Crown corporation that currently draws $876 million per year out of British Columbians and has never shouldered any responsibility, apparently, for dealing with the problem and the pathological gambling issues which result. I'm asking the minister to do us the courtesy of lifting the veil of secrecy over the B.C. Lottery Corporation's opinions with regard to that issue and the social costs of gambling, and to tell us what the B.C. Lottery Corporation thinks about the issue. That is not something that was asked in the general gaming estimates.

As the minister sits with his ankle crossed over his knee and sucks on his glasses and stares. . . .

The Chair: Member, could you please take your seat for a moment. The Chair has to remind all members that how members conduct themselves in the House is not a matter for debate.

K. Krueger: I'll continue. The minister has not risen to his feet, so I want it on the record that apparently he has not found that question worthy of answering.

The Chair: Member, perhaps the Chair could be helpful in that respect, because you have mentioned that a few times. There's nothing in Standing Orders that requires any minister to answer a question. You're free to ask questions, and if the information is available, it is most likely forthcoming.

K. Krueger: I know that people pay attention to what goes on in these estimates, and I'm getting public comment as I go out to my constituency weekend after weekend. I think it's important that people realize that when two questions run back-to-back, it means that the minister hasn't bothered to answer in between. That's the point that I'm trying to get across, so the people understand why there are these curious gaps in this debate.

I'm going to defer to the member for Vancouver-Quilchena to carry on this frustrating exercise for the next little while.

C. Hansen: I was wondering if the minister could advise us of the relationship of a company called B.C. Lottotech to the B.C. Lottery Corporation.

Hon. D. Miller: It's a wholly owned subsidiary of the Lottery Corporation.

C. Hansen: Could the minister advise us what role Lottotech has, what particular function it has, what the mandate of Lottotech is?

Hon. D. Miller: Electronic bingo.

C. Hansen: Could the minister elaborate, in terms of its. . . ? The field is electronic bingo, but could the minister explain to us what role Lottotech has with relationship to electronic bingo?

Hon. D. Miller: They have developed the technology.

C. Hansen: I gather from the answer that they are primarily into. . . . Does the minister see that as research and development, then, when he says "developed the technology"?

Hon. D. Miller: I guess it is.

C. Hansen: I'm looking for a bit more substantive response in terms of the role that Lottotech plays, hon. Chair. In terms of electronic bingo, could the minister explain what it is that Lottotech does, as a company?

Hon. D. Miller: Well, I did answer. It developed the technology for electronic bingo.

[ Page 4708 ]

C. Hansen: Could the minister explain? Is this something that's purely relating to the construction of equipment, in terms of hardware? Or are we talking about software development? Or are they the contractors for these services? I'm looking for a bit more elaboration, if that's appropriate.

Hon. D. Miller: Don't ask me what the technology is. I don't know anything about electronic bingo, and I hope I never do. But they've developed a technology -- it is in place and available -- and there have been some inquiries. There may be further inquiries, and there may be some potential to market this outside B.C.

C. Hansen: Does Lottotech lease or sell equipment to bingo operators in British Columbia?

Hon. D. Miller: I don't have a complete answer as to whether it's a lease or sale -- but it's at Starship Bingo, which is the only location. I'll try to get that for the member.

C. Hansen: We understand that B.C. Lottery Corporation has a business plan. Does Lottotech, as well, have its own business plan?

[9:30]

C. Hansen: I certainly don't expect the minister to have detailed knowledge of a business plan of a subsidiary corporation, but I would appreciate it if the minister could undertake to supply that to us if he has it. The minister's nodding, and I'd certainly take that as a response. I did want to come back to one point, which is a repetition of a point. . . . I just want to clarify something I asked earlier: is Lottotech 100 percent owned by B.C. Lottery Corporation?

Hon. D. Miller: Yes. That's the advice that I've received; that is the case.

C. Hansen: I would like to ask the minister what other subsidiaries B.C. Lottery Corporation would have an interest in.

Hon. D. Miller: I'm advised there aren't any.

C. Hansen: I want to ask the minister about a conference that was held last year called World Meet. It was a convention of state lottery corporations, I believe, from around the world that met in Vancouver last September. I wonder if the minister could advise us of the relationship between the conference and B.C. Lottery Corporation.

Hon. D. Miller: Yes, indeed. It was in October of '96. The Lottery Corporation hosted the World Meet, which was the first-ever meeting of all of the world's lottery organizations: North American, state, provincial, l'Association Internationale des Loteries d'Etat. The theme of the conference: five streams of knowledge, marketing technology, policy administration, case histories, suppliers. Revenue came from sponsorships and delegate registrations. The Lottery Corporation's sponsorships amounted to $110,000 of the $3.4 million in revenue raised, and included the opening and closing ceremonies, featuring B.C. talent. There were 1,350 delegates from 346 companies and 60 countries. Economic benefits attributed to World Meet by Tourism Vancouver were $5 million.

C. Hansen: Actually, the minister anticipated one of my questions in terms of costs and the value raised on sponsorship. He breezed through it very quickly, and I didn't catch that. I'm wondering if he could help me by repeating that.

Hon. D. Miller: Sponsorship: $110,000 from B.C. Lottery Corporation, out of a total of $3.4 million in total revenue raised. That was for the opening and closing ceremonies, featuring B.C. talent.

C. Hansen: In terms of the total cost to B.C. Lottery Corporation, does the minister have information on the hosting of that World Meet in addition to the $110,000 sponsorship?

Hon. D. Miller: I believe $110,000 was the amount.

C. Hansen: I appreciate that there are other costs in terms of staff involvement, which I understand were fairly significant. I don't want to go into that, but I would assume they would be over and above the $110,000 in direct sponsorship.

Hon. D. Miller: Yes.

C. Hansen: Could the minister advise us on who. . . ? As the host, was B.C. Lottery Corporation responsible for the revenues and disbursements for the conference?

Hon. D. Miller: Yes. As the organizers. I think there was a separate accounting system, so they would have played a kind of organizational role, as well, given that they were the host organization.

C. Hansen: Could the minister tell us the revenues and the costs for World Meet? Are they reflected in the annual statements of the B.C. Lottery Corporation?

Hon. D. Miller: I would think any expenditures would be, although not necessarily. The member mentioned, for example, staff. I don't know if it would be broken down particularly in terms of staff costs for attendance. They would probably have some reasonably accurate amounts with respect to staff costs for attendance at the function, or any staff costs relative to an organizational capacity.

I'll certainly attempt to get that, but it appears that the sponsorship put up by the corporation is fairly minimal relative to the entire cost of the meet. Clearly the economic benefit that flowed to the city was substantive: $5 million, by Tourism Vancouver's estimate.

C. Hansen: Perhaps my question wasn't clear. In terms of the total cost of staging World Meet, is that reflected in the annual statements of the B.C. Lottery Corporation?

Hon. D. Miller: The Lottery Corporation's costs. . . . I was just trying to say that there might be a discrete amount -- for example, the $110,000 I talked about. But I'm not certain that the breakdown of the report would itemize, in that separate way, the staff costs of people who may have attended from the corporation. But I will ask the corporation to provide as much detail as they have relative to those questions.

C. Hansen: There are two conventions coming up this year. There is an additional convention by AILE, the Association Internationale des Loteries d'Etat. I gather that would be 

[ Page 4709 ]

the second annual convention, and I understand the conference is being held in Europe this year. There's also another convention coming up for the North American State and Provincial Lottery Association -- NASPOL. I'm wondering if the minister could advise us what B.C. Lotteries' participation will be in each of those two conventions.

Hon. D. Miller: No, I can't. B.C. Lottery Corporation is often asked, as I assume other large corporations are asked, to be part of the thing, but I can't advise you if any decision has been made.

C. Hansen: In terms of the policy of the corporation with regard to staff attending these conferences, how many staff may be planning to attend? I gather that's a question that would be best asked when Mr. Simonis is here as a resource person. Or if the minister has that information, I'd welcome it now.

Hon. D. Miller: I don't have the numbers, and we will try to get that. I assume that any. . . . Whether it's in the private sector or the public sector, they're in a business, and it's not uncommon to attend meetings of this kind as part of developing your business in an ongoing way. Clearly that obviously appears to be the case for the other companies around the world and North America. How else would you have had 1,350 delegates attend in Vancouver? So I'll try to get a more precise number.

C. Hansen: With regard to the AILE -- and I won't try to pronounce its full name again this time -- I gather that the B.C. Lottery Corporation was involved in an interjurisdictional game with regard to the World Cup of soccer. I'm wondering if the minister could confirm that and expand on the nature of the corporation's involvement.

Hon. D. Miller: These things pass me by; I guess I just haven't had my eyes open. Yes, I guess we did. We did it as part of our sports gaming, I guess -- World Cup of soccer?

C. Hansen: Could the minister confirm that this is the only interjurisdictional lottery that the B.C. Lottery Corporation has been involved with, at least in recent years?

Hon. D. Miller: On an international scale. I mean, there are interjurisdictionals right now, and there have been as part of the Lottery Corporation -- 6/49 and those kinds of things.

C. Hansen: Could the minister advise us as to what the net revenue to the B.C. Lottery Corporation was from their involvement with the World Cup of soccer lottery program?

Hon. D. Miller: No. I don't have it; I'll try to get it.

C. Hansen: Maybe I can rephrase that in more general terms. Could the minister confirm that there were in fact no revenues back to the B.C. Lottery Corporation for their involvement in that?

Hon. D. Miller: No, I can't, but I will try to confirm whether it's a plus or a minus or a zero.

C. Hansen: Actually, the minister may have once again anticipated my next question, and that was whether or not our involvement in that lottery in fact cost the B.C. Lottery Corporation money as a net drain. I will await his response on that.

Could the minister advise us if the B.C. Lottery Corporation has any intention to become involved in any other international lottery programs?

Hon. D. Miller: No. I'm unaware of any proposed international games; there may be some. Again, I'll see if there are and will try to get that information to you.

C. Hansen: I gather from the minister's response that there's no specific policy that's been given -- direction is maybe a better word -- to the board of directors with regard to their participation in international or interjurisdictional lotteries.

Hon. D. Miller: There certainly haven't been by me, but there may have been in the past. I'll take a look.

C. Hansen: I understand that one of the terms of the contract with the president of the B.C. Lottery Corporation is that he has to give one year's notice of his intention to retire or to leave the corporation. I am wondering if the minister could tell us if any such notice has been given.

Hon. D. Miller: Apparently it's true.

C. Hansen: Sorry -- if the minister could explain what's true.

Hon. D. Miller: No, he hasn't given notice -- at least not to me. But I understand there is a provision for one year's notice.

K. Krueger: The government has announced its intention to restrict gambling in British Columbia to those 19 years of age and older only. The ticket seller I quoted a few minutes ago adds this in her letter. She is talking about the fact that people, from her point of view, tend to spend many times more than they can afford on tickets. She says:

"I've seen people spend upwards of $100 per week on lottery tickets. I've also seen parents give their children scratch tickets to scratch, thereby creating a new generation of lottery users. Invariably, if someone won $2 on a scratch ticket -- there are many of these -- they would spend their winnings on more tickets, and B.C. Lottery Corporation is the only winner here."

[9:45]

In any event, I move that the committee rise, report resolutions for the Ministry of Human Resources and progress for the Ministry of Employment and Investment, and ask leave to sit again.

Motion approved.

The committee rose at 9:47 p.m.

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