[ Page 6781 ]

Prayers.

M. Coell: Last week I had two classes of grade 11 students from Stelly's Secondary School come to the House. In the House today are 30 grade 11 students and their teacher Mr. Heywood to have a tour and to watch the proceedings. Would the House please make them welcome.

J. Weisbeck: In the House today is a constituent of mine, Mr. Rollie Heine, who is here representing the constituents of Lake Country. Would the House please make him welcome.

T. Nebbeling: I see in the gallery a friend and co-worker from my Whistler days. Bryce Rositch is an architect who is very much responsible for the quality of the face of Whistler Village as it is today, through his participation on various boards. May the House make him welcome.

E. Gillespie: Visiting in the precincts today we once again have a group of Challenge students from the Comox Valley. This is the third day in a row that teachers have brought students down to Victoria. I'd like to commend the teachers for their endurance and ask you all to help me welcome these students to the precincts.

Orders of the Day

Budget Debate
(continued)

Hon. D. Streifel: It looks like I'm having a clearing effect on the House.

An Hon. Member: Are you speaking?

Hon. D. Streifel: The first question was: am I speaking?

The Speaker: The minister might want to wait just a moment while members sort out whether they're going to meetings and that sort of thing.

Hon. D. Streifel: It seems like the bulk of my own colleagues left as well. It might have something to do with my new hair.

It's a pleasure for me to stand here today and address the budget, a budget that I was proud to have some input in developing. The government, the Minister of Finance, carried out wide consultation to build this budget plan -- with British Columbians, small business, big business, industry and labour. The overwhelming input and response -- the resounding voice from all British Columbians -- was: "We really want a break. We want a break in taxes, and we want a break in red tape." Government listened.

Interjections.

Hon. D. Streifel: Ah, the hecklers start already.

We listened. We've cut personal income taxes in this budget by a further 2 percent. Over the next three years we've cut the highest marginal tax rate from 54.2 percent to 49.9 percent. The corporate capital tax for 10,000 small businesses is gone over the next three years.

I notice the new Liberal member from up north someplace -- who carries a briefcase, actually, to carry the political cards around with him from party to party -- wants to get in on this. He can have his place when I'm finished.

Income taxes for 40,000 small businesses have been cut in this budget. By the year 2001, 90 percent of small businesses will not pay the corporate capital tax.

In this budget there's a B.C. Hydro rate rebate for all British Columbians -- 2 percent for households and small businesses and 1 percent for larger consumers -- along with continued tuition fee freezes and continued ICBC rate freezes.

Interjection.

Hon. D. Streifel: As a matter of fact, for the hon. member for Vancouver-Little Mountain, I wrote it. It's in my own handwriting, and I've signed it.

This budget also cuts red tape. That's one of the circumstances that businesses in this province, small and large, feel is a detriment to doing business. They asked us to take an initiative to cut red tape, and that we've done. We listened. We have a small business task force and a business advocate that will work with government to streamline the regulatory process, prune red tape, improve competitiveness, attract investment and create jobs.

In this budget the jet fuel tax has been reduced by 50 percent, and the farm fuel tax has been eliminated. Further, to support the forest industry, we've already moved to remove and reduce the regulatory burden contained in the Forest Practices Code. We'll be announcing and moving on initiatives to support mining and the oil and gas industry in this province.

Our consultations told us that these initiatives will stimulate the economy, encourage investment and create jobs. We listened to British Columbians, to small business and large business, and we delivered. Now let's work together and get on with it. Let's create those jobs.

British Columbians did not want to sacrifice health care and education or the new economy in this process. We have expanded training and education through a tuition fee freeze and the 2,900 post-secondary spaces created in this budget; that's to add to the 11,000 spaces that have been created over the last few years by this government.

We have continued support for film production; it's of ever-increasing importance to our economy, with over half a billion dollars a year generated. We have increased funding and support for tourism marketing in this budget.

Along with the support that these tax breaks and reductions in red tape indicate -- in support of individuals and small business -- British Columbians did not want to sacrifice health care. British Columbians never said to us in our deliberations that $6 billion was enough. That's why we've increased health care funding over the past six and a half years or so by close to $2 billion. Over $7 billion is spent on health care in British Columbia now. In this budget there's a $228 million increase in funding for hospitals, mental health, Pharmacare and reduced waiting lists for heart, cancer and kidney patients.

This budget also includes an increase in education spending. When I deal with communities like Mission, school dis-

[ Page 6782 ]

trict 75, they talk about the problems of a fast-growing school district. We recognize those problems. We're fully funding enrolment in this budget, along with increased spending for 400 new teachers. One of the most important initiatives, I believe, in the support for education in this budget, Madam Speaker and members opposite, is the re-establishment of classroom support -- counsellors, librarians and classroom aides -- that is contained in this budget -- some 300 positions.

This budget also contains continued support for families. This is the fourth year in a row of income tax cuts for low- and middle-income families in British Columbia. This is the third year of continued tuition fee freezes, Hydro rate freezes and ICBC rate freezes. Along with 230,000 families in British Columbia that receive the B.C. family bonus, 80,000 British Columbians will now receive relief on their MSP premiums. That's support for low- and middle-income families and ordinary British Columbians.

At the same time that British Columbians asked us to reduce taxes, to continue support for families, to continue support for health care and education, they also asked us to continue capital spending on schools, hospitals, roads and transportation initiatives. In this budget we have committed $1.25 billion in capital expenditures; that's a $275 million increase for school districts. Whether they're in opposition members' ridings or in government members' ridings, they will all see capital work in their schools this year. Over the next five years, we have committed $1.5 billion for school capital construction, to move away from the high usage of portables in this province. That's an increase in capital spending of $339 million this year.

This budget also contains support for the agriculture industry and for farming. As this government is committed to the integrity of the family farm and supporting of the family farm, there are many initiatives in this budget that support that. I'm expecting that later on in the morning, my hon. colleague from Nelson-Creston, the Minister of Agriculture, will be enlightening us on some of the most important initiatives for the agricultural community in this budget.

My ministry also received funding under this budget -- the Ministry of Fisheries. It's the first ever for British Columbia, and I was very honoured when the Premier asked me if I would take over the Fisheries portfolio and deliver an organized, coordinated community voice on behalf of British Columbians, to address the fisheries in this province.

[10:15]

I was in Kelowna the evening of the day I was sworn in as the Minister of Fisheries, meeting with the B.C. Aboriginal Peoples Fisheries Commission to hear from aboriginal peoples their concerns and their needs around fisheries and how they fit within the Fisheries structure. I went to the west coast of Vancouver Island; I was in Port Alberni and Ucluelet. I met with fish plant workers and owners, Coastal Community Network individuals, shellfish harvesters, shellfish farmers and aquaculturists to get their input on how this ministry can speak for them in dealing with Ottawa and in dealing with the monolithic bureaucracy contained within the DFO.

I was in the Kootenay at the Kootenay Trout Hatchery between Wardner and Fort Steele. I'm told by the staff of that hatchery that I was the first Fisheries minister to ever officially visit that hatchery. Laird Siemens, the manager of the hatchery, had me down there feeding the fish -- these large, 20- to 30-pound Gerard rainbow trout. He told me to hold a little piece of fish food in my hand, put it down in the water and see what happened. Well, being a new Fisheries minister, an individual who hasn't gone fishing for a long time. . . . The fish bit my finger. I was quite surprised. Of course, after he bit my finger, Laird wanted to see if he'd bite his finger too -- and yeah, he did. There was a hungry fish. It was a good thing I didn't fall in.

I was in Nanaimo on my provincial odyssey as the new minister. I met a company and some individuals that are piloting closed-containment aquaculture technology on behalf of British Columbians. It's a kind of fish farming that is virtually benign within the overall structure of aquaculture in this province. It's innovative technology that's being piloted in British Columbia.

Last Friday night I was in Duncan -- and I know that my hon. critic, the member for Abbotsford, was there as well -- meeting with the Coastal Community Network and listening again to their ongoing concerns about the fishery and how it affects them, and how they need their voice heard in Ottawa as we deal with our federal government, and to the concerns of our coastal communities that don't want to evaporate off the face of this earth -- that don't want to be extinct.

I talked to them about the east coast fishing report that was developed by the federal all-party standing committee. I talked about the east coast fishery, the devastation that's happened on the east coast -- the lack of community support, and there being no jobs in fisheries on the east coast. Our west coast communities don't want that same result. They want their voice to be heard by Ottawa; they want their voice to be heard loud and strong, because they have positive solutions for community control.

When I met with these folks, we discussed the west coast interim report that suggests that Ottawa should find a new way of doing business with the coastal communities. It suggests that if Ottawa were to work with these communities -- to look at their priorities and their needs -- their voices would be heard and their needs would be met.

The most recent opportunity for Ottawa to listen to these folks was in the announcement of the hake fishery. The communities of Ucluelet, Tofino and Port Alberni have invested millions and millions of dollars in their fish-processing infrastructure within their communities, in order to attract business and to be ready to work in an active hake fishery to process a high value-added product for this province.

The Department of Fisheries and Oceans didn't listen to the coastal communities; it has allocated a significant portion of that catch to be processed offshore by Polish factory ships. I think that's an absolute shame. I think Ottawa, the federal minister and the Department of Fisheries and Oceans should 

[ Page 6783 ]

be ashamed of themselves for not supporting British Columbians and Canadians.

I guess one of the most interesting things I've done as a minister so far was an announcement a week ago in response to a crisis happening with wild steelhead on six rivers on the inside of Vancouver Island. These fish are in an extremely hazardous circumstance, where it appears they may not survive. As a matter of fact, we actually used the possibility of extinction when we talked about these stocks. So we have undertaken an initiative, to be operated out of our Duncan hatchery, where this ministry will be capturing wild-spawned smolts from two and three years ago, raising them to adulthood and breeding them, in case we need their offspring to repopulate the wild stock in those creeks and rivers. That's the innovative way that this Fisheries ministry can work with communities on behalf of a resource that's very, very important to this province.

Before I take my seat, I'd like to talk about another initiative that our coastal communities and coastal MLAs have had involvement in, and that's the announcement last week. . . . My compliments to the federal minister, David Anderson, on his holding the line on the closing of the lighthouses. I know that our member for North Island and the members for Comox Valley and Alberni have been very, very active on this, which is very important to this ministry. This is my first opportunity to say: "Compliments, and thank you for the reverse of that decision."

As we go on and look at how this budget was formed through the consultative process and at the priorities of this budget -- create jobs, cut taxes, cut red tape -- this budget bases itself on the sound financial management that this ministry and this government have brought forward over the last few years. The deficit in this budget will be $95 million. A balanced budget is projected for 1999-2000 and a surplus in 2001. Health and education are protected. Other government programs and overheads have been cut by 5 percent this year, and further overhead reductions will occur.

Hon. Speaker, this province is in very, very good shape. It's well managed and well governed, and I thank the House for having the opportunity to get up and speak on this budget.

J. Sawicki: I too am very pleased today to rise and speak in favour of this budget. Those listening to this budget debate must be confused and wondering whether members on both sides of the House have actually read the same document. I have to say that I wonder the same thing. A couple of days ago the member for Abbotsford described this as a "let's pretend everything's okay" budget. Well, clearly the official opposition has decided to paint this as a "let's pretend the sky is falling" budget. I've never heard so much doom and gloom. In fact, I left this House last week thinking: "Gosh, I'd better go out and do some door-knocking, go and talk to some small businesses, and just see who's off base here. Is it the government or is it the official opposition?" So I went out on the weekend and talked to some of my constituents, and I'm pleased to come back to you and report to this House that the official opposition is way off base on this budget.

What I heard was that yes, my constituents are concerned about the deficit; yes, they're concerned about the debt. But they're also very pleased with the -- albeit modest -- personal tax cuts and the support to the small business community. In Burnaby-Willingdon, of course, we have a very vibrant and varied small business community. The constituents I spoke to were also unwavering in their support for government's decision to maintain and increase spending for health care and education and infrastructure. I might say that they were also pleasantly surprised when I mentioned that we will be committing $1.25 billion -- $250,000 over last year's budget -- to build and repair schools and hospitals and the necessary transportation structure, especially in the lower mainland, that will keep our communities livable and provide needed jobs.

Last year in Burnaby-Willingdon, among other educational infrastructure projects our government invested $1.4 million to begin renovations to Royal Oak School, which had been closed for a couple of years. The first floor is now done; our elementary school students are now in classes, and we're very much looking forward to being able to renovate the second floor of that school. We're also looking forward -- especially my colleagues in Burnaby North and Burnaby-Edmonds -- to beginning construction on the northeast secondary school. True to our promise to fully fund student enrolment, school district 41 in Burnaby received a 2.7 percent increase in its operating budget this year.

Health care. Burnaby Hospital, one of my favourite projects: $2.5 million last year to fund repairs to the hospital and a new multipurpose unit; and finally, our very antiquated and overcrowded emergency ward -- one of the busiest in the lower mainland -- is right now, as we speak, receiving desperately needed renovation. I am hopeful -- I say hopeful -- that with the additional allocation to the capital budget, the perinatal community birthing unit, which I and my two colleagues from Burnaby announced over two years ago, will finally receive the green light to proceed to construction.

Transportation. The addition of the two high-occupancy-vehicle lanes to the 401, which passes through the north part of my riding, is well underway. But what we really need, in order to tackle the air pollution problem in the lower mainland, is to get busy and start building light rapid transit along the Broadway-Lougheed corridor. Without that our lower mainland communities will not be worth living in.

I mention all these issues because if we had followed the course espoused by the official opposition -- if we had balanced the budget at all costs, if we had reduced the debt at all costs -- then these urgently needed investments in education, health care and infrastructure in my community couldn't and wouldn't be addressed. I believe that would have been a mistake. Our debt load and our debt-servicing costs are already the lowest in Canada, at 7.5 cents for each dollar in revenue. Just to give you a comparison, Alberta -- which the official opposition loves to cite as a model -- pays over 35 cents for every dollar in revenue.

I believe that at this time our government has made the right choice. We not only can afford to make these investments in education and health care and infrastructure, we can't afford not to. Let's be honest. This province is not in crisis, and it's irresponsible to suggest that it is. Yes, after six years of the hottest economy in Canada, with the best rate of growth and the highest number of jobs created -- all under a New Democrat government, I might add -- we're now taking our turn at a slowed economy. Yes, being a province at the gateway to the Pacific and heavily reliant on trade, the difficulties around the Asian economies are hurting us. Yes, the forest industry, still a mainstay of our provincial economy, is experiencing a slowdown, particularly for pulp. But our economy is built on strong foundations, and this budget builds on that strength.

[10:30]

[ Page 6784 ]

investment -- as if that issue was not even addressed in this budget. Clearly, if they had read it, they would specifically see in this budget that we will cut taxes to stimulate business investment and employment, revitalize our traditional industries, give small business a break, support the new knowledge-based economy of the twenty-first century, and cut red tape and overregulation. Hon. Speaker, how much clearer can we be?

I don't know where Liberals live, but in communities like mine, with a varied and rapidly growing small business sector, it is good news that we will be reducing the tax burden for small businesses to the lowest rate since 1986. It's good news that the small business corporate income tax rate will decline by 11 percent over two years. It's good news that effective January 1, 1999, we are raising the tax exemption threshold from $1.5 million in paid-up capital to $2.5 million; of course, that will go up to $5 million in the year 2001. That will effectively eliminate the corporate capital tax for 10,000 small businesses. It will mean that 90 percent of the businesses in British Columbia won't be paying that tax. I think that's good news. And when you add to it the two-year tax holiday for new small businesses that will allow young people, women or new Canadians who bring entrepreneurial skills from elsewhere to take that first step, go into business, grow, prosper and provide jobs for other people, this is good news.

Any well-balanced budget needs a variety of tools to support local economies. I have to say that while some of these tools are very helpful in my community, we also need measures to support some of the traditional resource-based industries. I want to talk a little bit about that. We are all negatively affected if forestry, agriculture, oil or gas are struggling, because that means fewer dollars into the provincial treasury and fewer opportunities to provide the quality-of-life kinds of services that we want to provide for all British Columbians.

The forest industry, as we all know, is cyclical. Companies know that the forest industry is cyclical. Sometimes prices go up; sometimes prices are down. We also know that despite the record number of trees that were cut in recent decades, jobs have drastically declined as companies have chosen to replace labour with technology. We also know that in the past, forest ecosystems were not managed as responsibly as British Columbians would like. That's why our government brought in the Forest Practices Code and, subsequent to that, the jobs and timber accord. The point I want to make is that the current downturn is not unique; it is part of a cycle. Any responsible forest company should be able to anticipate that. What must be unique, however, is our response.

This budget commits to stumpage reduction during this time, and that's fair. It also commits to reducing regulatory red tape, and there's nothing wrong with that either. What we must not go back on is the commitment to maintain environmental standards and pursue the jobs and timber accord, which challenges industry to create more jobs from every tree cut through silviculture management and value-added products. Some would suggest that these goals are luxuries that we just can't afford right now. True to form, the Liberal opposition -- whose leader, I might add, didn't mention the word "environment" once in his throne speech reply -- has been quick to jump on that bandwagon.

We have been down the road of sympathetic administration before, and British Columbians don't want to go down it again. So in the face of the very reactionary rhetoric that we heard on Bill 47 last session from the members from the opposite side of the House and that we are starting to hear again this session, I for one will be strongly urging our government to maintain its commitment to sound forestry practices based on adherence to tough environmental standards, respect for the whole forest ecosystem and sustainable jobs in the forest industry.

I want to turn now to another one of our traditional industries, and that is agriculture. I was also pleased to see the budget initiative to eliminate the tax on coloured gas used on farms. I would guess that the majority of members in this House have commercial agriculture in their ridings, and for some members that's the dominant industry. Even those of us who don't -- and I'm one of them -- might have grown up on a farm, as I did, or lived or worked in rural communities. That's why it's always a bit of a puzzle to me why successive governments in this province have continued to underestimate the role of agriculture and the degree to which it can contribute to the economy, including spinoff industries such as equipment sales and service and value-added products, so to speak. The good news is that there is tremendous potential for growth not only by encouraging more production on land that has capability and is not being farmed but also on the value-added side of agriculture. In fact, if it were up to me, I would have included agriculture under both categories that the budget attempts to address: traditional industry and the new sustainable economy for the twenty-first century.

We need to recognize that food security is an essential part of a sustainable future. Protection of farmland is fundamental to that food security, and support for food producers, for the agriculture industry and for rural communities can create the jobs we need and also help to stabilize and build those rural communities.

The final area I want to comment on, while I'm on the part of the budget that deals with job creation and stimulating the economy, is the commitment to build 1,500 new campsites as part of the very successful and now expanded E-team component of the Youth Options program. I have heard the opposition and the media make fun of those 1,500 campsites. But they obviously haven't seen the 1995 Coopers and Lybrand study which shows that economic activity generated by the parks system sustains about 9,300 direct and indirect jobs in British Columbia and contributes $430 million to the provincial coffers annually. These economic benefits of parks are widely distributed to every community. For every dollar spent on parks, British Columbians see a return of about $9 in visitor expenditure. That's a pretty good return for your money.

But protected areas and wild spaces have a value beyond dollars. Since this is my first opportunity, I want to commend and thank both the Premier and the Minister of Environment, Lands and Parks for the announcement last fall establishing 1.1 million hectares of protected area and 3.3 million hectares in a special management zone in the Muskwa-Kechika, otherwise known as the Northern Rockies. This is an absolutely spectacular area of international importance, and I am very much looking forward to legislation in this House this session that will legalize that very unique agreement that was brought about through consultation around an LRMP table to establish that protected area and special management area.

I also look forward, of course, to the commitment made in the throne speech and in the budget to complete the protected-areas strategy, which will protect 12 percent of representative ecosystems in this province by the year 2000.

I want to switch to a different aspect of the budget, which not only the people in the Northern Rockies area but in all of our communities, including mine, can take pride in. For the 

[ Page 6785 ]

fourth year in a row our government has cut taxes for middle- and low-income families. The speaker before me on this side of the House went through some of those tax cuts. They're not big tax cuts; they're small and, I think, significant tax cuts to personal income tax -- and the freezing of rural residential and non-residential school taxes and others. And, of course, there's the continuation of the freeze on ICBC premiums, on B.C. Hydro rates and on tuition fees.

BCIT is in my constituency; I visit it on a regular basis. I know the really good work they do not only with young people right out of school but with others who perhaps have been out in the working world and want to come back and get more education so that they can respond to a changing economy. That tuition freeze is absolutely unique in Canada. While we have frozen tuition fees for the third year in a row, other provinces have increased them by 20 and 30 percent.

There are other people in my community who will have to look elsewhere in this budget for the assistance they need, and those are the low- and modest-income families. While it was difficult, I think something that we can proud of is that this budget, in this difficult economic time, still chose to extend premium assistance under the Medical Services Plan to cut the cost of medicare premiums for low- and middle-income families. Do we hear the opposition acknowledge these important people-oriented initiatives? No, we don't. We just hear endless comparisons with Alberta. Indeed, one opposition member in his comments called Alberta a model for the rest of Canada. It's not my idea of Canada, hon. Speaker.

An Hon. Member: All with VLTs.

J. Sawicki: Yes, Alberta has balanced the budget, and they've also closed hospitals. Yes, they have balanced the budget, and you have to pay to send your child to kindergarten. Yes, they've balanced the budget, and they've put the poor on buses and sent them to British Columbia. And yes, as my colleague mentioned, they've balanced the budget with the help of $1.5 billion in revenue from gambling.

The hypocrisy of the words coming from that side of the House is just astounding. As everyone knows, I am no great fan of expanded gambling. To hear the debate in this House in the last session, you'd think that that side of the House wasn't either. But I guess that was last session, because this session they are holding up as a model a province that has balanced its budget on the backs of the sick, the young, the poor and those who are addicted to gambling. Some model.

Yes, regrettably we do have a small deficit in this budget -- $95 million. I am prepared -- and I do believe that the majority of British Columbians are prepared -- to accept a small deficit and maintain our record as the only government in Canada to consistently, year after year, increase spending on health care and education, and this year is no exception. We are doing that in the face of absolutely massive cutbacks in transfer payments from the federal government and without VLTs on every street corner.

Finally, I was talking to my local press, and the reporter used an interesting turn of words that I think sums up the two different solitudes around this budget debate to date. He said that while this wasn't a balanced budget, it seemed to be a balanced budget -- and he's right. Liberals have made it very clear that despite their crocodile tears over hospital wait-lists and families who are poor and young people looking for an education and their first job, they're only interested in one kind of balance: the bottom line, the traditional neoconservative, Michael Walker kind of balance -- the mantra of the marketplace, where people become dehumanized into taxpayers, where the global marketplace gets free rein over who gets to work and at what wage, where governments should just stay out of their way, where social equity and social justice and a clean environment are regarded as externalities, and where, in short, people serve the economy, instead of the economy existing to meet the needs of society and the greater public good.

[10:45]

I would urge the opposition to get on a more balanced and even keel that reflects what British Columbians really want at this time and to help us build a stronger and more sustainable future in this province.

The Speaker: On further debate, I recognize, for his first speech in our presence in this assembly, the member for Surrey-White Rock.

G. Hogg: Thank you, hon. Speaker. It is with excitement, with honour and with a sense of daunting anticipation that I stand before this House as the newest member of this assembly and as the representative of the people of Surrey-White Rock, the community I have lived in for all of my life.

As the tradition of this House would dictate and as my experience with you as a fellow former mayor would necessitate, I congratulate you, Madam Speaker, on your selection as our representative to this most important and prestigious position. I look forward to the fairness, the skill, wisdom and humour which I am sure you will bring to the chair.

It is important for me to again acknowledge my gratitude to the people of Surrey-White Rock for the confidence and trust which they have placed in me as their representative to this assembly. [Applause.] I might not get through it all if you. . . .

I must also extend a special word of thanks to my family, especially to my parents Kathleen and Allan Hogg and to my wife LaVerne and son Blair. Their work on my behalf and their support in over 20 years of public life has been most appreciated. Their joy at my election was, I am sure -- or almost sure -- not solely based on the fact that I would be away from them much more than in the past.

I have had the privilege of representing many of my constituents in various elected capacities over the past three decades. Whether as a city councillor, mayor, greater Vancouver regional district board member or director of over ten non-profit groups, I have always been very fortunate to have received the support, commitment and assistance of so many people -- people who have all helped to make my various roles interesting, challenging and rewarding. As I assume my seat in this Legislative Assembly, I know that my presence 

[ Page 6786 ]

here is a tribute to their efforts. I am both humbled and proud, knowing that the tasks and responsibilities which I have been chosen to deal with on behalf of each person in Surrey-White Rock are both skill-testing and exciting. I look forward to the continued support which I will need to receive in order to be a sensitive, informed and effective representative for all of my constituents.

[W. Hartley in the chair.]

Many wonderful, energetic and motivated volunteers sacrificed so very much of their time so that I could be here. They represent a true cross-section of my riding, and I trust that I can prove to be worthy of their loyalty and their support.

I also wish to acknowledge the first two representatives of the relatively young riding of Surrey-White Rock: Bill Reid, who continues to play a vibrant role in our community as president of our chamber of commerce; and of course, my immediate predecessor, Wilf Hurd, whose hard work and dedication to this House will, I am sure, be sorely missed.

I also want to acknowledge Grand Chief Bernard Charles of the Semiahmoo first nation. He was the first first nations person to be elected president of a students' council in British Columbia. He is now a lawyer and president of the Institute of Indigenous Government Studies. Bernard has brought a great deal of attention and acclaim to his people and to our community. He is a valued friend.

Surrey-White Rock has changed dramatically from the days when the people of the Semiahmoo first nation were fishing the bay and travelling up and down the coast both as traders and warriors; from the days when it was a logging community; from when the Great Northern Railway was built along the foreshore; from when the pier was the first official port as people entered Canada from the United States; from back to the beginning of time, when the sea god threw the great white rock from Vancouver Island to our foreshore and then swam with his beautiful first nations princess to make his home on the Semiahmoo peninsula; and of course, from the early 1900s, when the Vancouver Sun gave away a residential lot in White Rock with each yearly subscription to the paper. My, how times have changed.

The peninsula's first communities were Crescent Beach, Elgin, Ocean Park, Sunnyside, White Rock and the lands of the people of Semiahmoo. These communities have now grown together. They interlock, as growth in new neighbourhoods has brought them all together. We are all nudged, nicely and neatly, up against the Pacific Ocean and against the United States -- a border which is highlighted by the famous Peace Arch, built in 1920 to promote unity between our two countries. There are many parks, sporting facilities, museums, churches, beaches, libraries and marinas. There is a promenade, two piers and a thriving visual and performing arts community -- and all of this in an area whose rainfall is less than one-half that of our North Vancouver neighbours. These all combine to make Surrey-White Rock one of the most livable areas in this great province -- indeed, in this great country.

The community's character is evolving as rapid growth occurs. Many commercial areas, small businesses and financial institutions have made the peninsula their home. People come to Surrey-White Rock to play, to live and to work. Many also commute to various parts of greater Vancouver, thus giving rise to many transportation problems. The population growth has resulted in many extra demands being placed on our educational system. We are overcrowded, and we need a great deal of help just to get caught up.

Another key demographic feature of Surrey-White Rock is its senior population. Seniors have come from many parts of Canada to make the peninsula their home. They take advantage of the scenery and the services. Accordingly, health care continues to be the largest employer in the area and the service of greatest concern. Indeed, the community's interest in, development of and commitment to health care reflects the present and reflects the history of our area. The residents have a willingness to volunteer, to give, and they have a strong sense of independence. They, like residents in towns all across this province, know that the true fabric of a community is found in its volunteers and in its wonderful fabric, which this community has woven.

My father was one of the first physicians in the area, and I know how he looked forward to Peace Arch District Hospital's opening in 1952. It was the realization of the dreams and hard work of a whole community, led by a vibrant women's auxiliary, which is still as active as ever and this year is celebrating its fiftieth year of service to our hospital. Its volunteers have given more support per capita than any other auxiliary in this province. Its members epitomize the sense of volunteerism which has been such an essential component of so many parts of our community.

Hodding Carter once said: "There are two lasting bequests which we could hope to leave our children" -- to that I would add, "to our communities" -- "one is roots; the other, wings." Our roots are found in our sense of history, our sense of belonging. They are found in our appreciation of those who have gone before us and in the lessons which they have taught. They are found in the foundation of our beliefs and in our values and in how we treat ourselves and how we treat others, and they are found in the way that we treat our environment. They are the well from which we draw our identity and our strength. Our wings give us the ability to reach the vision of our individual and collective desired futures.

Mr. Speaker, it is that desired future that concerns me today. I do not believe that a shared sense of prosperity, of well-being, of economic growth, or even employment, is possible for many, based on the budget before us. I must admit that I did come to hear this budget with high hopes and with low expectations. My expectations have been more than met; unfortunately, the hopes of so many people across this province have not been. The patterns of the past seven years -- patterns of deficit and debt -- are making it increasingly difficult, if not impossible, for us to be optimistic about our future.

It is during times of difficulty and adversity that the character of our government's leadership is tested and ultimately revealed. Sadly, the revelations of this budget seem to be characterized by Freud's phrase: "They hear what they want to hear and generalize and distort the rest."

We are now enduring difficult times, and they have been exacerbated by this budget. We have heard the sad litany of our economic fall from grace -- from number one in economic growth to number ten in just seven short years and seven consecutive budget deficits in an age when five provincial governments and the federal government have all balanced their budgets. We have a debt of $32.25 billion and tax increases which have meant the average family of four now pays $2,300 more than they did in 1992. The character of leadership shown in this budget has been a disappointment. It has cursed the darkness rather than turn on the lights, just when I thought there might be a flicker, a glimmer, of hope.

[ Page 6787 ]

The token cuts to personal and business taxes will have little impact on the majority of people of this province and certainly will not, as this government announced, serve notice that British Columbia is open for business. On the contrary, the stage has been set for the continued downturn of our economy and, therefore, a downturn in the hopes and dreams of people all across this province. We need look no further than to the foreshadowing provided by the recent drop in our bond rating -- a drop which was a direct consequence of the budget. There surely is more to follow. It does not bode well for the people of British Columbia.

To be successful as individuals and as organizations, we must learn from our experiences. I am reminded of a scene that I read from a James Michener novel in which a mother and a daughter were sitting on their veranda looking at a sunset, each of them rocking away in their separate rocking chairs. After a period of rocking in silence, the mother turned to her daughter and said: "You know, dear, you really should listen to your father. He has 50 years' worth of living experience." After a few further moments of silence, the daughter turned to her mother and said: "You know, mom, what I think dad really has is one year's worth of experience lived over 50 times." Well, this government has one year of experience -- albeit not a very good year -- lived over seven times.

We must learn from our experience -- both ours and others -- and we must learn, as all economic students do, the principle of the Laffer curve: if taxation is at 100 percent, no one works; and if taxation is at zero, there are no government services. We need to find -- we must find -- the balance for our province, but we don't even seem to be looking. This budget does not find the balance; it only ensures that the remedial actions which future governments will have to take in order to revitalize our economy will be even more onerous. It ensures that we cannot look forward with hope for yet another year, and it ensures that many people in B.C. will suffer, without a reasonable expectation of change in the near future, and that is unconscionable.

[11:00]

The Sufi tradition teaches living and life through parables. In one such parable, Mullah Nasruddin is depicted walking along a mountain trail when he comes across a family of four, all on their hands and knees, obviously searching for something. He inquires of them: "What are you looking for?" The father replies: "We have lost our key." So the mullah gets on his hands and knees and joins in the search. After searching for an hour, the mullah inquires: "Where do you think you lost the key?" The father points and replies: "Over there, in the cave." The amazed mullah asks: "Then why are you not searching in the cave?" And the father answers: "Why, it is far too dark in the cave; we cannot see. And it is light here, so we look where we can see."

Well, hon. Speaker, this budget has sought to find the key to our woes in the false, deluding light of another day rather than by taking the hard, sometimes difficult steps necessary to search, find and apply the difficult solutions which will lead us back to prosperity. I cannot support such delusions, nor can I support this budget.

D. Symons: I too wish to rise and speak on this particular budget, because this budget -- more properly described as a fudge-it -- is a real disappointment. After a couple of months of the Premier's comments about meeting with business, union representatives and others -- indicating that he was listening, that changes were coming and that people will be pleased with this fudge-it -- I mean budget. . . . What a lead-up and what a letdown.

We have a new Finance minister but a budget that reflects the same old NDP tricks of shifting spending and full-time-equivalents off the books and then claiming to be reducing spending, reducing the size of government and reducing the deficit -- claims that, except for the miracle of cooking the books, are not true.

Listen to what the Finance minister said in her budget address last week, while praising the NDP's past fiscal performance, if you can call it that: "Here's what happened in the 1997-98 fiscal year. We reduced spending for the first time since 1958-59." Well, I must say that at least that's an admission that they have increased spending in the previous five years of their reign of fiscal mismanagement. But when she goes on to say that last year's spending was $100 million less than the year before, then we're in trouble.

Let's look at that figure in light of how the books were fudged last year: $70 million worth of Highways spending went to the Transportation Financing Authority and off the books; $20 million disappeared into a new tourism agency and off the books; $100 million in silviculture spending is now being done by Forest Renewal -- more money off the books. Let's see: how much is that? That's $190 million of spending that is no longer counted as spending, as would have previously been the case. That $100 million reduction the minister spoke of seems to me to be at least a $90 million increase in spending rather than a decrease, if it were treated on the previous basis. Not only that, but they reduced the grants to municipalities by $113 million that year. Does downloading onto municipal governments and homeowners count as reducing spending? Well, according to this government's way of thinking, yes. I doubt that either municipal governments or property owners would agree with the NDP on that particular point.

Listen, hon. Speaker, to an example of how this government cooks the books. I'm reading from a letter of July 29, 1994. B.C. Transit was seeking proposals to supply six locomotives for commuter rail service. In this proposal that they're asking people to respond to, part 4 says: "Alternative Financial Arrangements. B.C. Transit is interested in considering any reasonable off-balance-sheet type of leasing agreement. Please consider offering, in addition to the normal purchase and sale agreement, an alternative leasing or financial arrangement." Did you notice that an alternative financial arrangement was described as being an "off-balance-sheet type" of leasing? That's the sort of manipulation and why I use the word "fudget" for this budget, because indeed they're doing the same thing.

Not only were they seeking some financial arrangements that were off the balance sheet, but also note the date of this particular request. It was dated July 29. I ask you how long you would think it's reasonable for a company that might receive this letter of request for proposals to put together a 

[ Page 6788 ]

well-thought-out and expensed proposal for $15 million worth of equipment? Well, it goes on to say: ". . .responses must be delivered to the above address by 12 noon, Vancouver time, on Friday, August 19, 1994." That's only 14 working days from the date of this particular letter. Does it sound like the fix was in and the recipients of this letter and others like it were not going to be seriously considered?

Well, if you have any doubts on that, the next line is even more blatant. It says: "Responses will not be publicly opened." We're keeping the contents of all these proposals secret; you'll never know who really made the best proposal. The letter stated, "Six commuter rail locomotives, including one spare, are required for this service," and you'd think that's what they would be after. But no, after all this, B.C. Transit accepted a bid for five, not six. And who was the minister responsible for B.C. Transit while all of this was going on? It was none other than The Man Who Would Be King, the man who is now Premier of this province.

And the NDP is up to the same tricks today. Nothing has changed except the increase in the size of debt in this province. Last year the provincial debt was increased by $800 million. It is the yearly increase in debt and the total debt itself that are the numbers that matter. These numbers are more difficult for the NDP to manipulate in order to mislead and misinform the public.

This year our Finance minister is claiming an even lower deficit than last year's phony number -- a $95 million deficit for this fiscal year. But wait. Looking over the Highways ministry estimates for the coming year, I find that $123 million of spending for highway rehabilitation, previously paid for as a ministry expense, is now listed as a $123 million recovery. It almost appears that some kind benefactor has given $123 million to this government to rebuild roads that have fallen into disrepair -- I might add, because of this government's foolish underfunding of timely upkeep of our highway infrastructure. Maybe he fell into a pothole, but no such luck. Those costs have been shifted over to the Transportation Financing Authority to be paid somehow, sometime in the future, by us.

This is just one example of this year's manipulation of the books. Forest Renewal B.C. and other agencies are also used to hide spending formerly accounted for in the consolidated revenue fund, and those are the numbers that count in our deficit figures.

This is a government that believes in the future. That's when they say the tax breaks, as small as they are, will be coming. That's when things will be better. "Trust us. Would we lie to you? Didn't we already bring you two balanced budgets? Aren't we reducing spending? Isn't the size of the deficit going down? Just don't look at the increased provincial debt."

This budget is as honest and reliable as the previous NDP budgets. They're telling us they are reducing spending and the deficit will be $95 million, but the debt for this coming year will increase by $1.25 billion. By this time next year the total provincial debt will be over $31 billion. That means there is $2.4 billion in interest charges -- $2.4 billion collected in taxes that will not go into hospitals, schools or social programs. Rather, that money will go into the moneylenders' pockets, to big banks and other financial institutions. That is not good, prudent fiscal management.

This is not just my opinion or the opinion of the Liberal opposition, as much as the government would care to say. It is also the opinion of the Dominion Bond Rating Service. After seeing this budget, they reduced B.C.'s rating. They are saying, and we are saying, that this government, this gaggle of fiscally incompetent people, has failed to address the fiscal challenges of this province in a meaningful way -- fiscal challenges, I might add, that are mainly the result of this government's mismanagement over the past six years. This is the seventh consecutive deficit by this NDP government, a record for B.C. Maybe we should have a plaque mounted in the rotunda to commemorate this dubious achievement -- the legacy of debt bequeathed to this province, to this generation, to the next and maybe the next and the next. Who knows? It's something for posterity to reflect upon.

I mentioned earlier that it's not only their financial claims that are suspect but also their claims for reducing the size of government. If we examine the full-time-equivalent employment summary in this year's estimates book, we find that the coming year's full-time-equivalents are down by 525 -- from 34,304 full-time-equivalents last year to 33,789 this year. This sounds like a reduction in the size of government, doesn't it? But wait. Last year's full-time-equivalents summary had a footnote, and that footnote said: "The 1996-97 FTE budget assumed that 1,903 Ministry of Health and Ministry Responsible for Seniors and Ministry of Transportation and Highways FTEs would be transferred effective April 1, 1996 to entities outside the consolidated revenue fund" -- i.e., off the books.

What we find is that those transfers that didn't take place in the last fiscal year are taking place now, and therefore that supposed reduction in the number of full-time-equivalents simply happens because they're counting them in a different way. Notice it said: ". . .outside the consolidated revenue fund." It does not mean that they are no longer paid for out of government funds; it's just coming out of a different pocket. But it is all out of your -- the taxpayers' -- pocket. For example, 1,400 Ministry of Health employees have now been transferred to the regional health boards -- who get their funding to pay for their employees from the Ministry of Health -- but the employees are no longer counted as employees of the Ministry of Health. They're not part of their full-time-equivalents. Similarly with the motor vehicle branch, which has now been transferred, along with its employees, from the Highways ministry to ICBC -- and off the books; there are, in reality, over 900 more employees this year, not less.

[11:15]

Let's look at some of the NDP's words on budgeting: "There's no magic to balancing the budget in British Columbia. In fact, it's extremely easy, absolutely one of the easiest things I could imagine doing." Now, who might have said that? That was said in February 1989 by the NDP's then Finance critic, who is now our Premier. Another quote: ". . .we will, in our first budget" -- remember this one -- "reduce the tax burden for all middle- and lower-income British Columbians" -- April 20, 1990, again by that NDP Finance critic, now the Premier. And another: "British Colum-

[ Page 6789 ]

bia taxpayers urgently need some relief from the tax unfairness of this government" -- "this government" is referring to the Social Credit Party, and that was March 21, 1991, by the NDP Finance critic, now our Premier.

What happened after the 1991 election, when that critic became Finance minister? Did he balance the budget? No. Did he reduce the tax burden? No. He brought in two of the highest-deficit budgets in the history of this province. Did the NDP reduce taxes and fees? No, quite the opposite. They increased taxes and fees by $700 million in 1992 and another $800 million on top of that in 1993. That's how you can trust the words of this government. Now they're expecting people to be thrilled that they are going to reduce, ever so slightly, the tax burden that they themselves imposed; but that reduction won't even kick in until next year.

Listen again to the hypocrisy of this government. This is what our now Premier said on May 11, 1990: "Mr. Speaker, this rich province has endured the worst, most fiscally incompetent administration in the history of British Columbia, and that minister knows it." Again, he's speaking of the Social Credit government. "No one could be as incompetent as that administration. They have taxed people. They have taxed money out of the pockets of working people in this province to pay for their incompetence." That was said by the now Premier of the province on May 11, 1990. It was said as part of a private member's statement on that date, and the title was "Fiscal Dishonesty in Government." Can you imagine the hypocrisy of that person, who is now the Premier of this province?

Again, on March 21, 1991, the now Premier said: "British Columbia taxpayers urgently need some relief from the tax unfairness of this government." What did that same self-righteous speaker do when he became Finance minister one year later? Well, on March 26, 1992, just one year later, he said: "First, the basic personal income tax rate will be increased by 1 percentage point, effective July 1, 1992." This is the same person who was demanding that British Columbians needed tax relief. Can you believe it? Talk about Dr. Jekyll and Mr. Hyde! And note that in his case, he didn't wait until the next calendar year to increase this tax as the budget says they're going to do this year. He said "July 1," just a few months after he brought in his budget.

Also in that budget speech: ". . .we are introducing a new levy on legal billings. . .we are introducing a number of commodity-specific revenue measures, including an increase in the jet fuel tax and higher liquor markups." They're doing the higher liquor markups this year. I might add at this point that I was critic for Transportation and Highways at that time, and I raised the issue with the minister, now the Premier: "If you're going to raise the jet fuel tax, you're going to cause some real problems in the air industry in this province." Indeed, he said at the time: "Well, if we've done that, we'll undo it."

Well, they're getting around to gradually undoing the problems they created at that time. But you know what happened? During those intervening years, we have had more and more airlines tank up off-province, because it's cheaper for them to do it. We have had more and more people become suspicious of this province's treatment of businesses, and therefore they've gone elsewhere.

You can't always just say: "Well, we'll undo it a few years later." The damage is done, and it takes years and years to overcome that damage. But that minister and the Finance minister this year do not understand that concept. Those tax increases took an extra $700 million out of taxpayers' pockets. That was 1992. Was he finished fleecing us then? No, in his budget speech in 1993, our Premier -- then the Finance minister -- said: ". . .we must face the reality of tax increases. . .we are asking British Columbians to contribute more today so we can all do better tomorrow." Notice again: they're believing in tomorrow. Everything's always coming in the future.

"Contributing more" meant an additional $800 million in new taxes. That was an increase of $1.5 billion in the tax load in two years. Even with all of that new revenue, this government, up to and including this year's budget, continued to overspend every year by a billion dollars -- a billion dollars more than the new revenues they'd been taking in, a $1.25 billion deficit or increase in debt this year.

This NDP government's tax-and-spend policies, combined with increased bureaucracy and government red tape, have done far more to harm the economy of British Columbia over the last seven years than the recent economic problems in Asia. Today we are still exporting more to Japan -- and they are our biggest Asian trading partner -- than we did in 1992.

I would like to use the remaining time to simply look at some of the specific items in this year's budget. In item 1 in the budget, the government says that taxes will be cut for 40,000 small businesses. Notice what they're going to do on January 1, 1999: they're going to reduce the rate from 9 percent to 8.5 percent -- half a percent. But this is the same government that increased the rate in 1992.

Item 2 in their budget says: "Corporation Capital Tax Eliminated for 10,000 Small Businesses." Again, this will be effective on January 1, 1999. Who introduced the corporation capital tax? This same government. They promised when they introduced it that they would remove the corporate capital tax when they balanced the budget. Obviously they're still not planning on balancing the budget. When they said they had balanced budgets in 1995 and 1996, did they remove the corporate capital tax? No, partly because they knew they were not telling the truth when they said they had balanced the budget.

Item 3 in the budget speech says: "Revitalizing Traditional Industries. . .forestry, mining, and oil and gas will continue to play a key role in our province's economic success." Well, who on earth made a mess of the forest industry and the mining industry in this province? This NDP government. Now they sort of recognize that they play a key role in our economic success -- belated recognition, I must add. Over the past five years, because of government regulations and red tape, costs in the forest industry have increased by 75 percent. That is much of the problem; it's not the Asian flu that's causing our economic problems in this province.

Again reading from the budget speech, it says: "We are working closely with the forest industry to improve competitiveness by further reducing stumpage charges and simplifying the regulatory framework." Well, it was the NDP government that increased stumpage charges and introduced a host of regulatory frameworks that they're now going to try to simplify.

It talks about the Ministry of Energy and Mines, and I must remind you, hon. Speaker, that it was this government that removed that ministry just a few years ago. Now they've realized that it plays an important economic role in this province and have reintroduced it.

Further on they've got "Strengthening Our New Economy," and the budget says: "To help B.C. business keep and attract these highly qualified people, effective January 1" -- again in the future -- "we will lower income surtaxes to 

[ Page 6790 ]

reduce the top marginal income rate tax from 54.2 percent to 52.7 percent." That is still pretty high. "We will further reduce the rate to 51.3 percent on January 1, 2000. . . ." Notice that what we have as an outcome of that particular tax, which was increased by this government in 1992, is a brain drain to the eastern provinces of Canada and to the United States. You don't overcome that in one year by simply changing it. You don't change the attitude that people have formed to investment and to moving to B.C. and bring back those brains to help our high-tech industries here.

I notice that this year the government, as announced earlier this year. . . . The tax on jet fuel will be cut from 4 cents per litre to 3 cents per litre, effective April 1, 1998. Well, that is one tax reduction that they brought in this year, but they are the government that introduced the jet fuel tax only a few years ago.

We are also targeting 1,500 more campsites this year and next year. Somebody said that these might be described as relief camps. I'm curious as to where the money for those campsites is coming from; I suspect it's going to be from FRBC, which is again putting money off the books.

It also says under "Cutting Red Tape," in part 5 of the budget: ". . .we recognize the need to cut red tape in British Columbia. We want to make it easier to do business so that business can create jobs." Yet that is exactly the red tape that this government introduced in B.C. and failed to cut when they said they were going to last year. They're still at it; they're repeating the same promise.

They're going to introduce a business advocate, to cut red tape. What they seem to be doing here is simply adding another bureaucracy to government. Rather than getting on with the job, they're going to study it some more.

It says: "Creating a Positive Business Climate." Well, this government has done its level best over the past six years to uncreate a positive business climate in the province, and it's going to take more than a few words in a budget address to change that.

One thing in the budget that bothers me somewhat is this promise that they're going to give a rebate of 2 percent of your hydro bill. I really have a problem with that, because I find that the government has taken over $300 million in what we call a kickback -- I believe it's a dividend that they've taken from B.C. Hydro -- whereas B.C. Hydro still has $7 billion worth of debt today. If this government believes that Hydro has so much extra money around that it can give us a rebate, why don't they reduce hydro rates for everyone on a fair basis, rather than this little electioneering rebate? They seem to be planning for the next election. Reducing the hydro rates would be a fairer way to do things.

"Capital Investments to Keep B.C. Competitive and Create Jobs" -- I'm just reading a title from the budget speech. They say: "Contracts will be awarded based on competitive bidding to save taxpayers' dollars." Unfortunately, that has been one of the legacies of this particular government in the past years. They have not always lived up to that, but I am encouraged that at least they're promising that they're going to award contracts in a fair and competitive manner -- not exactly as they've been doing in past years. But they're admitting, I suppose -- since they're saying here that they're going to do it that way -- that they haven't always done it that way in the past.

[11:30]

The government is also, in this particular budget speech, promising to reduce waiting lists. They've been saying this each year, but I find that the waiting lists have not been reduced. As a matter of fact, I think they said last year that they put an extra $3 million into reduced wait-lists. I checked around with a few doctors and a few hospitals and found out that wait-lists for many of the procedures are pretty well the same. They haven't changed. So it's a perennial promise that that the government keeps bringing up: they're going to deal with this problem. And it's a perennial problem that never seems to be addressed.

Again quoting from the budget speech: "The budget I am tabling today contains two major new commitments to education funding." What this increase in education funding really is, is a partial recovery from the past few years of the per-pupil funding reductions that have taken place. Much of the money that they say is going to create new jobs -- 400 new classroom teachers, they're saying, and 300 additional librarians -- simply will not occur, because that money will be used to cover past inadequacies of funding to the education system. If I add that up, that's 700 positions. If you divide 700 positions into the amount of money, either each of those positions will be getting $143,000 -- which seems like a pretty excessive amount to be giving to somebody -- or there are some real problems in the way this government is dealing with distributing that money.

[The Speaker in the chair.]

The one thing I would like to mention toward the end, as I see I'm running out of time, is. . . . They talk about more opportunities for B.C. youth. I'll have to read this carefully. They talk about an additional $26 million in funding for youth employment. I find, looking at the budget figures, that under the Ministry of Human Resources, the Youth Works program spending is $31 million less this year than last year. Under Advanced Education, Training and Technology, the Youth Works and Welfare to Work programs are reduced by $9 million, and I find that the youth programs are increased by $6.4 million. So we've had $40 million in reductions and $6.4 million in increases. Overall, then, youth spending, by looking at the government's own documents, seems to have decreased by $33.6 million.

Yet I find in today's newspapers all sorts of items commenting on how well this government is doing in funding youth programs. But the government documents would seem to imply that there is $33.6 million less going into that than in the past year. So I'm not too sure whether I'm missing something in the books. I would be delighted to be informed by the government where it is. If it is in the books, I may be missing something. Or indeed this government's going through its sham program again, even with youth employment.

Hon. Speaker, this particular budget that this government has put together this year is no better than the others, and I thank you for this opportunity to respond to it.

J. Weisbeck: This is my first opportunity to speak in the House this session. Unfortunately, I have not had the privilege of participating in the initial portion of this session due to the death of my father. Although this may not be in keeping with normal protocol, I would like to extend my sincere apprecia-

[ Page 6791 ]

tion to all of you who have offered your support and your condolences over this very difficult time. My father was very proud of my role in this Legislature, and your friendship has made me equally proud to participate alongside all of you.

Also at this time, Madam Speaker, I would like to congratulate you on your new position and wish you all the best.

I rise today to respond to the budget speech on behalf of the constituents in my riding of Okanagan East. The throne speech describes the economy of British Columbia and its people as "vibrant." So I guess this feeling I get in the pit of my stomach when I think of this government's mismanagement of our province, its people and its resources, and the resulting state of British Columbia's economy, must be coming from all this vibrating.

What a huge misunderstanding this government has of the needs of the economy and of the business community. This budget is as naïve and empty as the Finance minister's feeble attempt to realign herself with the business community by wearing a new pair of boots and a sophisticated pinstriped suit. Has she lost all sensibility? If she wanted to wear something that fittingly reflected what she and the NDP have nurtured, she should have been sporting hip waders and a very large scoop shovel. You cannot mimic the outward fa�ade of good, honest business with a pair of shiny boots. People just aren't that naïve. And it will take a great deal more than a girlish giggle and a suit to change a public opinion that has been developing for years.

The public is very much aware of this chameleon act. And guess what. The public doesn't forget, so you aren't going to sway the public trust spouting platitudes and handing out whitewashed, conditional giveaways. There have been too many similar schemes and performances, which only result in a string of broken promises and poor management decisions. The problem that now exists is whether or not this government can grasp the concept of free enterprise and, having grasped it, move into the next millennium unencumbered by its current archaic ideology.

While other provinces across Canada are recording a series of balanced budgets, this government now has the distinction of seven deficit budgets in a row. The Premier's directive was to sacrifice balancing the books in favour of spending more on health and education and giving tax breaks to business. But when one looks at the end results of this budget, it would appear that tax breaks to business have not gone far enough. This would lead one to believe that all of this pre-budget hype was merely an opportunity to cover up this government's incompetence and its inability to instill confidence for investment. The NDP has achieved the distinction of being the slowest economic learners in the history of B.C.

Now we have learned that our worst fears have been realized. For the second straight year the incompetence and economic policies of this government have led to a credit downgrade. The Canadian Bond Rating Service has downgraded British Columbia's long-term debt rating from AA+ to AA. The downgrade reflects the rise in debt levels that have financed eight years of deficit spending and caused the debt burden to increase significantly.

The province's debt total is now 26 percent of the GDP, whereas it was only 12 percent in '89-90. It has almost doubled on a per-capita basis. The resultant heavier debt burden has deteriorated the province's credit profile and left it exposed to a slowing economy. The CBRS also stated: "Many of the tax relief measures are deferred, and the economy may not benefit in the near term."

It was interesting to note that there was finally an admission, after years of accusations, that the NDP has failed business -- an admission that government doesn't create jobs, an admission that red tape and overregulation have made B.C. non-competitive, an admission that we are being overtaxed. This past year has seen a huge increase in job loss, and this trend has been accelerating. During the month of January alone, 19,000 jobs have been lost. It is only as of late that the significant and true effect of these oppressive policies is beginning to be felt in B.C. The archaic ideology of this socialist government has finally come to rest, and business is responding. They are fed up and they're not going to take it anymore.

Business is going elsewhere. They are taking their companies and their personal assets out of B.C. Finning Tractor is moving its head office to Edmonton. Nature's Path Food Inc. is opening a new plant in Blaine, Washington. Dave Ritchie of Ritchie Bros. Auctioneers, a long time resident of British Columbia, has moved his home to Alberta because of B.C.'s high marginal tax rate.

Trust can take a long time to develop, and when it is lost, it can take even longer to be regained. This is now occurring in B.C. Business doesn't trust this government and is very reluctant to invest in this province. How could you blame them, when so many promises have been broken? A recent survey has shown B.C. as the most desirable place to live, but we should be the most desirable place to invest.

Overregulation is probably most prominent in the forest industry. David Emerson, president and CEO of Canfor Corp., addresses this concern in his '97 annual report:

"These are challenging times for Canfor and the forest products industry, particularly in British Columbia. While poor markets in Asia and the spillover to other markets account for part of the problem, the fact remains that North American lumber prices are high by historical standards.

"The fundamental issue is of one of costs and trade policy. Stumpage, taxes, fees, charges for public sector services and the dramatic run-up of compliance costs associated with forest practices and environmental regulations have created a cost structure in British Columbia that is not sustainable. Add to this the protectionist limitations imposed by the Canada-U.S. softwood lumber agreement, and the challenge facing the industry looks very serious."

The province's approach to regulation is flawed. The Forest Practices Code is a good example of little attention being paid to weighing costs and benefits when new regulations are developed. B.C. simply can't compare itself to other competing jurisdictions, because of their high cost of production.

The provincial government often claims that British Columbia has one of the lowest tax bills in the country. This claim, however, is not based on all the taxes that get passed along as higher prices and Crown corporation profits. The average B.C. family has the highest tax burden in the country. The provincial tax rate has risen from 18.7 percent in '92-93 to an estimated 21 percent in '97-98. This represents a 12 percent increase. The problem is that even though the NDP have admitted these problems, they simply have not gone far enough to eliminate them.

The corporate capital tax, probably the most controversial tax, has been a huge disincentive to business in B.C. Not only has this tax caused business to move out of B.C., it has also inhibited business from moving into B.C. It would appear that the Premier is not willing to admit that it was a mistake to have introduced this tax when he was the former Finance minister. Because he is unwilling to admit his foibles, he is equally as unwilling to eliminate the tax. Once again, they 

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have not gone far enough. The corporate capital tax should be eliminated unconditionally. The government either doesn't grasp the urgency of their problem or isn't capable of setting in place the necessary policies.

[11:45]

Not only has the NDP abandoned its debt management plan, the deficit numbers appear to be suspect. The government has been doing a lot of its increased spending off-budget, outside the budget's consolidated revenue fund. But the fudging of the numbers is nothing new for the NDP. Over the past eight years the province has reported a total of $6.5 billion in annual deficits. This does not coincide with a cumulative debt increase of $20.5 billion over the same period. The difference between these two numbers confirms the fact that there are problems with the government's accounting practices. The total deficit numbers should be much closer to the growth in debt. British Columbia is one of the worst provinces for moving government business off the primary books, and Skeena Cellulose is a good example. That bailout money should have been placed under tax-supported debt.

The auditor general says that last year's deficit should be $674 million. That's $306 million more in red ink than the books show. More accurate figures for this year's budget are close to $1 billion rather than the estimated $95 million put forward in this budget speech. This increase in debt and deficit is further supported by the Toronto-Dominion Bank and the Bank of Nova Scotia, who say that the NDP is forecasting economic growth at 80 percent higher than their figures.

There is a definite need to have the government keep their books according to generally accepted accounting principles. In order to restore faith in government, British Columbia must have a complete understanding of where the people's money is being spent. The ability of the government to manipulate the debt to the Crown corporations is just not acceptable. The Liberal Party has introduced the Truth in Budgeting Act to assure British Columbians that this accountability will take place.

The debt now stands at $31.24 billion. Not only is this figure staggering, but more frightening than that is this figure is up $1.2 billion from last year and $13 billion over the last seven deficit budgets since the NDP have taken office. Everyone understands that when growth is exponential, it is out of control.

What impact will this budget have on municipalities? The northern part of my riding is made up of the recently incorporated district of Lake Country. It was incorporated with the blessing of this government and given the impression and the assurances that the numbers would be workable. Given the current boundaries of the tax base, this was absolutely contrary to a prediction made 25 years ago by the regional district director, John McCoubry. He commented that the district would never be financially viable with the current tax base. Those boundaries had been decided, with the expansion of the city of Kelowna, to include a large industrial park and residential area. The district of Lake Country was misled into believing that they would have government support for the many services needed by a new and growing community.

Then the '97-98 budget hit -- an 18 percent reduction in municipal grants and the realization that the tax base cannot possibly support this new infrastructure. The '98-99 budget again sees a reduction in municipal grants, so this is especially worrisome for the district of Lake Country. This has added further uncertainty to a very volatile situation.

B.C.'s economy is at a time of considerable uncertainty. Confidence is at an all-time low, and there is a widespread feeling that our competitive edge has worn thin. The government's main economic preoccupation seems to be job preservation in industries where viability has been seriously undermined by the government's own policies and action. What better example than Skeena Cellulose? The government bailout has allowed the recovery of a weak player in a weak market. The government has committed more than $300 million to a rescue package for a pulp mill where there are questions about the sustainability of the timber supply and the mill's environmental standards. To add insult to injury, taxpayer-subsidized Skeena Cellulose has undercut other B.C. pulp producers by selling pulp at below-market prices. Skeena has been unethical in its practices, with the financial backing of this government.

The people in my riding of Okanagan East would have liked to have gotten that sort of windfall to reduce the health care crisis, to renovate and rebuild seriously aging schools and to give further help to the fruit industry. But this government, in its infinite case of bad judgment, chose to put hard-earned taxpayer dollars into something that is doomed to fail rather than into the certainty of things that will result in positive possibilities.

This budget was a huge disappointment. The seriousness of the problem was not recognized by this government. The economy of this province is on a slide and will continue to slide unless this government intervenes and rewrites this budget using realistic numbers and correct projections. Unfortunately, the message to the business community is that the government doesn't have the will or the competence to make the province attractive to investment. It's time to shred this budget and start over with a document that reflects the concerns of British Columbians.

Hon. D. Streifel moved adjournment of the debate.

Motion approved.

Hon. D. Streifel moved adjournment of the House.

Motion approved.

The House adjourned at 11:52 a.m.

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