1998/99 Legislative Session: 3rd Session, 36th Parliament
HANSARD

The following electronic version is for informational purposes only.
The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

TUESDAY, JUNE 22, 1999

Volume 16, Number 9

[ Page 13887 ]

The House met at 2:06 p.m.

Hon. L. Boone: I have a number of introductions here today, so if you'd bear with me. . . . They're very important people who I'm glad to see in the House to witness the introduction of a very important bill: Cpl. Jim Burton from the Coquitlam RCMP; Diane Sowden, Children of the Street Society; Rob Sowden, Children of the Street Society; Rebecca Prins, Children of the Street Society; Ryan Noseworthy, Youth in Care Network; Jamie Kershaw, Youth in Care Network; Tom Lalonde, Métis Family Services; Rosalinn Drescher, Métis Family Services; Sandy Cooke, Covenant House; Marilyn Dooley, MCF after-hours service; Grace Steer, PEERS; and Pat Griffin, Victoria Youth Empowerment Society. Also with them are ministry staff Irene Clarkson, Jillian Stewart, Mark Sieben and Jeremy Berland. Would the House please make them all welcome here today.

Hon. H. Lali: It gives me great pleasure to introduce a fellow constituent, Mr. Frank Rizzardo, chairperson of the B.C. Road Builders and Heavy Construction Association. Along with him is Mr. Tony Toth, who is the president. These gentlemen represent the roadbuilding industry in British Columbia and are happy about this government's $950 million investment in highways infrastructure this year. Would the House please give these gentlemen a great welcome.

J. Reid: It's my pleasure to introduce to the House today two constituents: Barb Barrett and Jon Walters. I would ask that the House please make them welcome.

R. Coleman: This afternoon in the Legislature are some grade 7 students from Credo Christian Elementary School in my riding. They're accompanied by their teacher, Mr. Hugo Vanderhoek, and a number of parents as chaperons. Would the House please make them welcome.

J. Sawicki: I have two guests in the gallery today: Alan Durning and Donna Morton. They are both with Northwest Environment Watch, an environmental research organization. Alan Durning is based in Seattle, and he has co-authored a number of books, including Tax Shift and the most recent one, Green-Collar Jobs, on the changing economy in the Pacific Northwest. Donna Morton has recently opened the Victoria office of Northwest Environment Watch. Would the House please make them very welcome.

Hon. C. McGregor: It's my pleasure to introduce two special guests who are joining us here today for the introduction of a very special bill. I'd like to welcome George Smith of the Canadian Parks and Wilderness Society and Bill Wareham of the Sierra Club of British Columbia. Would the House please make them welcome.

[1410]

Introduction of Bills

CHILD, FAMILY AND COMMUNITY SERVICE AMENDMENT ACT, 1999

Hon. L. Boone: I move that the bill be introduced and read a first time now.

Motion approved.

Hon. L. Boone: I am pleased to introduce the Child, Family and Community Service Amendment Act, 1999. This bill will amend the Child, Family and Community Service Act, the province's child protection legislation, in three very significant ways. First, it will strengthen our ability to use restraining orders to keep pimps and other sexual predators away from children at risk, to help prevent sexual exploitation. Second, it will create a new youth services part of the statute to change the way the ministry supports young people who are already known to the ministry. It provides additional tools and flexibility to serve youth more effectively. Third, it will clarify existing provisions of the act for judges, lawyers and social workers. These amendments bring us one step closer to our goal of supporting all children and youth to grow up strong and healthy.

Bill 84 introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

PARK AMENDMENT ACT, 1999

Hon. C. McGregor: I move that the bill be introduced and read a first time now.

Motion approved.

Hon. C. McGregor: I am very proud to introduce this bill today and say that once again British Columbia is demonstrating its international leadership in the establishment of protected areas. This bill establishes nearly 1.4 million hectares of new parkland and 35 new parks. In addition, we are providing permanent legislative protection to 15 existing parks that were previously established by order-in-council.

We are extremely fortunate to live in one of the most ecologically, recreationally and culturally rich areas of the world. This government has taken great pride in its efforts to protect some of the most beautiful and precious wilderness areas in our province. Ten of the new parks created by this bill are situated in the globally significant Muskwa-Kechika region of northern British Columbia. Preservation of the untouched beauty, abundant wildlife and natural resources found in these parks builds on the celebrated historic decision of this government to protect the Muskwa-Kechika area. Creating these parks furthers our international reputation in the field of conservation, wilderness protection and sustainable development.

[ Page 13888 ]

On an administrative note, I want to point out to all members that we have used the new mapped-boundary process, which was used last year. This method is more accurate, understandable and practical for all users than the written metes-and-bounds descriptions previously used. The office of the Clerk and each party have been provided with copies of the maps for review.

[1415]

POULOS INVESTMENTS LTD.
(CORPORATE RESTORATION) ACT, 1999

S. Orcherton: I move that the bill, of which notice has been given on the order paper, be introduced and now read a first time.

Motion approved.

S. Orcherton: Poulos Investments Ltd. was struck off the registry of companies more than ten years ago, when it neglected to file all of its annual reports. Ordinarily, the company would provide a summary process for restoration to the registrar, but that process is not available after ten years.

I move that the bill be referred to the Select Standing Committee on Parliamentary Reform, Ethical Conduct, Standing Orders and Private Bills.

Bill Pr403 introduced, read a first time and referred to the Select Standing Committee on Parliamentary Reform, Ethical Conduct, Standing Orders and Private Bills.

Oral Questions

PREMIER'S ROLE IN HYDRO-RAIWIND LAWSUIT

Hon. G. Clark: The members opposite, of course, can call me names; they can do what they want. They've done it repeatedly.

Interjections.

The Speaker: Order, members.

Hon. G. Clark: It may be good short-term politics, but I don't think it's good for the province or in the long term.

Interjections.

The Speaker: Members. . . .

Hon. G. Clark: B.C. Hydro will make a decision on whether to appeal or not. I have to say that it is a puzzling decision when a judge can find the CEO guilty of conflict of interest yet nevertheless award him a settlement of some $500,000. It's troubling to me, and I think most people who look at the case would say the same. Their lawyers are analyzing this question, and I certainly hope they appeal.

The Speaker: First supplementary, the Leader of the Official Opposition.

G. Campbell: With respect, that's simply not the issue. The issue is that the Premier made up the story, and no one believes him. The Supreme Court of British Columbia has said that they simply don't believe the Premier's story, and the problem is that this is once again risking taxpayers' money. The last time we had one of these politically motivated appeals, it cost the taxpayers another $80,000. Why should the taxpayers continue to spend money while the Premier tries to regain or salvage at least a shred of personal credibility?

Hon. G. Clark: The same judge found that the Liberal allegations were completely unfounded in the same decision. The issue on appeal has nothing to do with me. The issue on appeal is whether or not it's acceptable for an individual to get a settlement of $500,000 when he was found to be in a conflict of interest.

This is an issue which goes beyond B.C. Hydro; it goes beyond myself; it goes beyond the government. It's a very serious issue for the conduct of Crown corporations. The lawyers at B.C. Hydro have been examining this for some time. Clearly it's an area where there has to be an active consideration of appeal. From my perspective and, I think, from the average person's perspective, how someone could get such a huge and generous settlement at a time when he was found to be in violation of conflict of interest rules is beyond everybody. I think it's one which warrants an appeal.

The Speaker: Second supplementary, the Leader of the Official Opposition.

G. Campbell: There is one reason that the taxpayers are going to be hit with a $500,000 bill, plus legal fees. That's because of this Premier's actions, because this Premier made up a story which nobody believes. This Premier said that he didn't know anything about it; the courts found that in fact he did know something about it. Directors know he knew something about it. Mr. Laxton knows that he knows something about it. Mr. Sheehan knows that he knows something about it. The fact of the matter is that the reason that this is a wrongful dismissal suit which has been successful is because of this Premier's wrongful actions. Will he stop it now and save the taxpayers thousands and thousands more dollars?

[ Page 13889 ]

[1420]

Interjection.

The Speaker: Order!

Hon. G. Clark: . . .wife to purchase shares in this venture. It was against the conflict rules of the day; it was against conflict-of-interest law. The judge has found that in spite of that, he should receive 20 percent of what he asked for -- some $500,000. I don't accept that, and I don't think the average person would accept that. I'm hoping that there are legal grounds for appeal, because I think the precedent is very serious for Crown corporations in Canada.

G. Farrell-Collins: The Premier doesn't get the point of the case. The fact of the matter is that despite being in a conflict of interest, the court still awarded him $500,000. . .

Interjections.

The Speaker: Order, members.

G. Farrell-Collins: . . .because he had the approval of the minister responsible to buy those shares. That's the whole point.

The court ruling said that in the past the Premier had told Mr. Sheehan "not to put embarrassing things to him. He said that [the Premier] could be quite explosive if 'you approached things the wrong way.' " This aggressive style of the Premier has cost taxpayers $8 million at B.C. Hydro with Mr. Sheehan; $200 million at the fast ferry corporation with Mr. Tom Ward, who apparently was told not to tell anybody about the cost overruns; and who knows how much money with Frank Dixon at B.C. Transit. Can the Premier tell us what the current tally is to the taxpayers of British Columbia for his aggressive leadership style?

Interjections.

The Speaker: Order, members.

Hon. D. Miller: In the few minutes it took the member opposite to frame his question, he has been consistent in his style, which in my view we have witnessed for too many years in this House. He constructed a question made up of fabrications. Quite frankly, I think the time is long gone when we ought to respond to the kind of mudslinging, innuendo and falsehoods portrayed by that member in his questions.

The Speaker: First supplementary, the member for Vancouver-Little Mountain.

Interjections.

The Speaker: Order, members.

G. Farrell-Collins: The time has long gone that the people of British of Columbia should be paying the bills for that group of incompetents on that side of the House. Is it any wonder that the Deputy Premier finds himself cleaning up mess after mess left by the Premier, when we hear a Supreme Court justice in British Columbia say that the Premier told him in the past not to put embarrassing things to him? He said that the Premier could be quite explosive if you approach things in the wrong way. Can the minister tell us how much British Columbians are paying for the way this government operates like a bunch of thugs in British Columbia?

Hon. D. Miller: Well, again, the. . . .

Interjections.

The Speaker: Members, the Deputy Premier has been recognized and has the floor.

Hon. D. Miller: The language the member uses illustrates my point. All of us in this House are familiar with the low-life methods that the member opposite uses. It's disconcerting, I think. . .

Interjections.

The Speaker: Order!

Hon. D. Miller: . . .to average British Columbians that the member. . .

Interjections.

The Speaker: Order!

Hon. D. Miller: . . .continually makes up and falsifies issues, as he did in the question he asked the question before last. He is so obsessed. In fact, when he wants to talk about flying off the handle, perhaps he ought to look in the mirror a little more often.

[1425]

G. Plant: The press conference of February 22, 1996, was not just another photo op for the Premier. No. In fact, a scandal had arisen which struck right at the heart of his duties as a minister of the Crown, and the brand-new Premier tried to escape that scandal by saying two things to British Columbians: (1) he didn't know who the shareholders were, and (2) he had given explicit instructions that no senior Hydro management was to invest in IPC. He took that story into a court of law. He swore an oath; he was not believed. I question the fitness of a man to hold office in those circumstances. I challenge the Premier to acknowledge that the reason the judge found in Mr. Sheehan's favour was because the Premier knew that Mr. Sheehan's actions were taking place and did nothing to stop them.

Interjections.

The Speaker: Order, members.

Hon. D. Miller: Scandal? They love the word "scandal", don't they? They apply it to everything. They make up the

[ Page 13890 ]

Interjections.

The Speaker: Order, members.

Hon. D. Miller: The lie was. . .

Interjections.

The Speaker: Members. . . .

Hon. D. Miller: . . .that friends and insiders could get these shares. That's what they said, even though we know that the Leader of the Opposition was quite familiar with issuing shares to sophisticated investors. He'd done it himself.

The Speaker: Minister. . . .

Hon. D. Miller: We know that. They said this was tax avoidance.

The Speaker: Caution, minister.

Hon. D. Miller: We know they made that up. They made that up, and they stand in this House and use the term "scandal." It's outrageous. It's outrageous to have those people who have made up this tissue of lies. . .

The Speaker: Minister, thank you.

Hon. D. Miller: . . .stand here on their mile-high moral horse and ask these kinds of questions.

G. Plant: On the one hand, the Premier stands up and says: "Oh, there was something terribly wrong in Hydro, because Mr. Sheehan did all kinds of nasty things, and I can't believe why he wasn't allowed to be fired." And then the Deputy Premier stands up and says: "Scandal? What scandal?" Why don't the two of them get together just once and see if they can get their story straight? Will the Premier stand up now and acknowledge that the findings of fact are correct? The judge's version of the facts is the version that he has to live with, and British Columbians should not have to pay one more cent for his flights of fancy, frolics and errors in judgment.

Hon. D. Miller: This is the third question period in a row where the Liberals have tried desperately to advance this issue, and they're getting nowhere.

Interjections.

The Speaker: Order, members.

Hon. D. Miller: Let's examine the facts again. We have a judgment that says. . .

Interjections.

The Speaker: Order!

Hon. D. Miller: . . .that the president of a major Crown corporation, B.C. Hydro, committed -- according to the courts -- errors in judgment. His wife bought shares. He didn't advise the very board he reports to. . .

Interjections.

The Speaker: Order, members.

Hon. D. Miller: . . .that that took place. He committed errors in judgment, and the Liberals opposite think he should get a payoff in excess of $500,000. We on this side don't think he should, and we don't think that average British Columbians think he should, either.

Interjections.

The Speaker: Members, come to order.

Hon. D. Miller: So we have simply said -- and the Premier, when asked his opinion, has volunteered it both in this House and outside this House -- that Hydro ought to examine this issue to see if there are grounds for appeal. They will do that in due course.

[1430]

Interjections.

The Speaker: Order, members. The member for Matsqui has been recognized.

M. de Jong: We have a judgment that says the Premier is not to be believed and a Premier who cowers in his chair, afraid or incapable of answering these allegations.

The Speaker: Hon. member, that is unparliamentary -- a reference to other members.

M. de Jong: I'm still intrigued by the response the Premier gave last Thursday, when he was asked to account for the fact that the Supreme Court of British Columbia didn't believe a word he had to say about the version of events leading up the Hydrogate fiasco. I was standing beside him. "Bad lawyers," he said, "bad legal work." But what did he mean? Doesn't the Premier realize that the best lawyers in the world can't manufacture a victory when the evidence wasn't there and isn't there? The evidence was never there, because the Premier misled everyone on this Hydrogate fiasco.

Interjections.

The Speaker: Order, members. Come to order, members.

Hon. G. Clark: It is unacceptable to me that someone who is in violation of the conflict-of-interest guidelines and is in violation of conflict-of-interest law should receive a settlement of $500,000.

Interjections.

The Speaker: Members. . . . The member for Vancouver-Little Mountain has already asked a question. The Premier has the floor.

[ Page 13891 ]

Interjections.

The Speaker: Order, members.

Hon. G. Clark: They could have avoided public scrutiny with a settlement out of court. It was not a recommendation of settlement from me. I recommended not to settle out of court, because it is unacceptable for someone to break conflict guidelines and act in this fashion and receive. . .

Interjections.

The Speaker: Members. . . .

Hon. G. Clark: . . .a settlement of $500,000. That is the same reason why I would hope that B.C. Hydro will find the legal reasons to appeal what I think is a wrong decision.

Tabling Documents

Orders of the Day

[1435]

ESTIMATES: MINISTRY OF FORESTS
(continued)

Hon. D. Zirnhelt: I want to provide some information to elaborate on a response with respect to interprovincial comparisons for stumpage. We were talking about interprovincial comparisons and some of the difficulties in getting decent comparisons. I said that the comparisons are difficult to make -- virtually impossible. But even if they're done, it's not clear what they mean, and here are some of the reasons.

There are different markets. B.C.'s coastal industries' main market is Japan, so they sell into markets, and it has a value different than that of wood from other jurisdictions where they have no markets in Japan.

There are different products. B.C. produces lumber as our main product. Quebec, for example, is very heavy in newsprint.

There are different species. We have unique species -- to name a few: Douglas fir, western red cedar and Engelmann spruce -- and there's different quality. Our trees are generally larger and of higher quality than other provinces. So if Quebec finds a 12-foot-diameter cedar, they might charge more or, the way they're set up, they would probably export it.

There are different responsibilities. Some provinces pay for reforestation, some have trust funds for that, and some charge stumpage according to the product produced. This all complicates the comparisons.

There are different efficiencies. B.C. sawmills and workers are, we believe, the most efficient in Canada and, as a result, can get a better return from the wood. Therefore the wood is probably more valuable.

There is different terrain. B.C. has mountainous terrain on the coast, with ocean access. Quebec and Ontario have relatively flat land interspersed with lakes and bogs.

Having said that, the comparisons are difficult. We accept that B.C. charges more for sawlogs than other provinces. We believe we charge less for pulp logs than other provinces. Historically this has been case, as our sawlogs are generally better than anywhere else in Canada.

[1440]

So is industry profitable today? We believe the interior lumber sector is quite profitable, and the coast lumber sector is improving. Can we do more? Yes, we can, and yes, we will, on the cost side. But we're not going to make structural changes to the stumpage system until the current arbitration results are known. We will consider stumpage in the context of the expiration of the softwood lumber agreement, and there is consensus in industry and government on that matter.

J. Wilson: At present we have a bill before the House that deals with the agricultural land reserve and the forest land reserve. I'm wondering if the Minister of Forests could tell us what area of the total forest land in British Columbia is included in the forest land reserve.

Hon. D. Zirnhelt: You know, with all due respect, the figures have been made public before, and a little bit of research on the part of your staff would have that for you. I will endeavour to get it. It means that we stop the debate, go look for somebody and come back here to give you small bits of information. I don't mind doing that, but you're using your own time allotted for debates in estimates. I want that to be made absolutely clear. I don't mind doing it; I will do it.

The general answer to your question is: the land that is included in the forest land reserve in British Columbia is land that is classified as managed forest land.

J. Wilson: My second question now is: if the minister knows how much land is included and has those figures, does

[ Page 13892 ]

Hon. D. Zirnhelt: We'll see if we can get that information for you, but if there is a concern that you want to raise around it, I'd be happy to try to respond. The information is that there are about 50 parcels between Kamloops and Prince George that are in the managed forest class. We can get the information from the B.C. Assessment Authority. That's the source of the information.

J. Wilson: In this forest land reserve, are there any areas of Crown land included?

Hon. D. Zirnhelt: Yes, there is a lot of Crown land in the forest land reserve -- in fact all of the land in the provincial forests. The provincial forests, you will remember, are areas zoned for timber production. In order to preserve the working forest, Crown land was also put into the forest land reserve.

[1445]

Hon. D. Zirnhelt: The land that's in the forest land reserve is TFLs and privately managed forest lands -- that is, the plus or minus 50 parcels in that part of the interior which are classified as managed forest land, which I've talked about, and the Crown land. I don't refer to Crown land as parcels as such, but if there happened to be some Crown land that had been parcelled out -- that is, surveyed out -- and that is an identifiable parcel, it is probably in the land reserve. I'll have to check.

J. Wilson: Is the forest land that is included in the agricultural land reserve excluded from the forest land reserve, or is it included as part of it?

Hon. D. Zirnhelt: It's my understanding that the land in the provincial forests is in the forest land reserve. So if it's in a TFL -- the provincial forests -- then it's in the forest land reserve. If it's Crown land that is not in the provincial forests and that is agricultural, then it could be in the agricultural land reserve.

J. Wilson: Then I would assume that the forest land reserve has been laid out with definite boundaries so that we know exactly what areas are included in it and what areas would be excluded.

Hon. D. Zirnhelt: Just as a matter of advice to the member, I will endeavour to answer the questions. If they're of an excessively technical nature, I'll need to have the staff here to answer them. But we're going to be debating a bill that discusses all of this, and I would suggest that that might be an appropriate place. All the officials with all the detailed technical answers will be there at that time.

J. Wilson: We have had a bit of a briefing, and we've asked these questions. We've asked for this information, and it hasn't been given to us. We were told that it was available and that we would get it, but we have not received it. So I have come to the person who should have the most knowledge on the subject and the most ability to make this material available to us. It is something that is needed immediately. I would ask the minister if it is not within his power to make that available. Either they have a map laying out the forest land reserve, or they do not have a map laying out the boundaries of the forest land reserve. That's a very, very simple question. If the map exists -- and we've been told that it exists -- the minister is probably in a much better position than anyone else to obtain that information immediately and provide us with it.

[1450]

G. Abbott: The minister, when he made his initial comment after lunch, indicated that there would be no changes to the stumpage system until after the current arbitration is complete. I think I heard him say that. I think I also heard him say that government and industry had agreed on how a review would be conducted. Perhaps I heard him wrong there. I guess the question here is: will the nature of the stumpage system form a part of the public forest policy review that is expected at some point later this year?

Hon. D. Zirnhelt: We have said that we would look at the structural issues surrounding stumpage and pricing as part of the long-term forest policy review. As I explained to the member before the lunch break, there is consensus in industry and government on that; I reiterated that. We're doing it because, in the interests of what's best for British Columbia, we will deal with positions that revolve around the negotiation, as we get into negotiations with the parties. We will table positions at the appropriate time.

G. Abbott: Returning to where we were just prior to the lunch break, which was a discussion of some of the issues around fibre costs and the code, the minister noted with favour the conclusion of the 1998 PricewaterhouseCoopers report on the forest industry in British Columbia: the reduction in the cost of logging on Crown lands from $88 per cubic metre in '97 to $79 per cubic metre in 1998. Would the minister also agree with the conclusion of PricewaterhouseCoopers, as noted on page 2 of that report, which states: "Reduced logging activity in high-cost areas accounted for the majority of the decrease; lower stumpage accounted for the balance"? Would the minister agree, as PricewaterhouseCoopers indicates, that the majority of the decrease in delivered log cost was a product of reduced logging activity in high-cost areas?

Hon. D. Zirnhelt: I'd have to say that Pricewaterhouse has not given us an analysis upon which we could formulate a basis to conclude one way or the other on it. It's a survey of Pricewaterhouse companies, and they came to their conclusion. It's not our conclusion.

G. Abbott: So the ministry, then, would attach about the same level of certainty to the estimated reduction from $88 to

[ Page 13893 ]

[1455]

G. Abbott: When the Minister of Forests and the Minister of Environment announced that they were going to be undertaking some streamlining of the code, which I guess was back about. . . . Was it a year or two ago now? The minister indicated that the aim to take out, I think, about $300 million a year in costs that were unnecessary regulation in the code would permit the code to be delivered at a reduced cost. As I recall, the minister estimated that that would be about $300 million a year that could be saved, in terms of the cost of the code. Does the minister now, based on the experience of the past year or two, believe that savings of that magnitude have been achieved? The minister has used this figure of about $1 billion in cost savings to the industry. Does he reckon that $300 million a year has been saved to this point in the so-called Bill 47 changes to the code?

Hon. D. Zirnhelt: When I use the figure of $1 billion, I'm using about half that figure. We have low-balled the savings that were targets. One of the reasons is because when we say we want to achieve a $5 reduction, some people will come up and prove we haven't. We go back and say: "Well, yes, but your costs haven't gone up by $5." There have been companies that say their cost of the code is scarcely a dollar, so how can you save $5 when your code costs only went up a dollar? You can't.

It's highly variable, company by company. Because it's so highly variable, there was no methodology. There was no data that companies had or government had -- or could ever have -- that would disaggregate this to the point where we're saying: "For every cubic metre, it's $5." On average, we have suggested that we would take about half of that. Half of that contributes to what we talk about in the $1 billion in reduction of costs.

G. Abbott: And again, if the historical record is wrong here, the minister can correct it, but I believe the estimated cost of the Forest Practices Code, when it was first being advertised, was that it would be about $5 a cubic metre, on average, across the province. In reality, I understand the cost to be in the range of $12 to $20 a cubic metre across the province. Again, depending on terrain, climate and, I suppose, a whole range of other issues, the cost has varied within that $12-to-$20 range. Is that a correct summary of where we were, at least until the recent attempts to streamline the code came into play?

Hon. D. Zirnhelt: The original estimate was $5.05. The KPMG estimate was $12.22. We've used that for purposes of making policy -- not $12 to $20.

[1500]

Hon. D. Zirnhelt: Here is where averages become a problem. It's $12.22 across the province. It's $8.41 in the interior, north and south combined, and that takes in the wetbelt. They're averaged in the interior. The southern interior is $9.12; the northern interior is $7.78. The average for the interior is $8.41. So in there, there might be some difficult wetbelt ground. It wouldn't surprise me that the costs have gone up in order to protect the soils in the forest, that they have to helicopter or high-lead instead of building roads. It doesn't surprise me at all. At the coast it's $19, for an average of $12.22.

The unforeseen code costs for the purposes of our discussions and submissions based on the stumpage reductions. . . . We believe that the June 1 reductions offset the increase of just under $5 -- about $4.89 -- which were the unforeseen code costs.

G. Abbott: When the Ministers of Forests and of Environment made their announcement with respect to the reduction in the size and cost of the code, I was fortunate enough to attend the news conference. The dramatic backdrop was thousands and thousands of pieces of paper stacked up in bundles. I gather that there was estimated to be 100,000 pieces of paper there, and I think there was some suggestion from the ministers that those stacks of paper represented the volume of unnecessary regulation that could be streamlined out of the code to make it more effective without losing any of the environmental values associated with it. Have we achieved that? Have we, at this point, seen a reduction in the code of the magnitude that was promised at the press conference that morning?

Hon. D. Zirnhelt: Well, the measure won't be so much in the amount of paper. We would reduce the number of plans from six to three. In some cases, a little more information might have to go into the plans, and in some cases perhaps a little less. So we are going to try to give a measurement in terms of the amount of paper. The paper was there to symbolize the number of plans, but it generally represented what's meant if you reduce the number of plans from six to three. That's what we have done; we've done that. Yes, we've achieved the reduction in plans.

[1505]

[ Page 13894 ]

Was it, then, purely symbolic? Or if I was to look at the code today in terms of the volume of it, would that volume. . . ? When I looked at it from a distance of a couple of feet or from five feet or whatever it was, would I be looking at a significantly smaller pile of paper? Or would I simply have seen six plans rolled -- contentwise, largely -- into three? Can we give some kind of description or quantification to the volume of paper and the volume of regulation that have been eliminated since the spring of 1997?

Hon. D. Zirnhelt: You know, if we studied the volume of paper and had a study to measure the volume of paper, I'm sure that member would be the first to stand up and say: "What a waste of time." I would agree. So no, we haven't measured paper.

The measure of whether we succeed is whether or not the costs are coming down penny by penny, dollar by dollar. We measure the cost reduction. We said: "We'll take industry's measure." We might ask some questions. But the fact remains that costs are coming down, and people have told us that it has to do with the streamlining and the other initiatives at cost reduction.

G. Abbott: The reason why at times it's useful to measure or to quantify or to analyze is to get a sense that we are dealing with reality as opposed to illusion. Now, if the 100,000 sheets of paper as a backdrop were simply that -- a backdrop -- then the candid admission of that is just fine. But if there was a commitment to see the volume of regulation quantifiably reduced, then I would like to see some measure.

If the minister wants to have one of his staff people make a comparison of the code in the spring of 1997 and the code in the spring of 1999 and tell me that there's been a 10 percent or a 5 percent or a 20 percent reduction in that, I commit today to not criticize him. I'll get up and salute when we get the results, whether it's 5, 10, 20 -- or zero -- percent that has been reduced.

Interjections.

G. Abbott: I seem to have awakened one or two of the members on the other side of the House. That's excellent -- obviously a little sensitive on this point here.

The point is this: if we're going to reduce process and reduce paper -- if we are sincere in that objective -- then I have to do unpleasant things like ask whether, in the process of rolling six plans into three plans, we actually ended up with a reduced volume of paper and a reduced volume of regulation. That's where we're going here, and that's the question. I guess the answer I've heard so far is that there's no way of measuring that and that the government isn't particularly interested in measuring that. Is that a fair summary of that?

Interjection.

G. Abbott: Maybe the Minister of Human Resources wants to respond. She seems to have some answers over there.

Hon. D. Zirnhelt: No, it's not.

[1510]

Hon. D. Zirnhelt: We are on to code. I've asked for the code staff to come. I can give you a general answer on that. We were on fibre costs; we've moved into codes.

We've asked the companies if we have achieved results on any of these matters around regulation. We measured a bit on whether we have persistent complaints, requests or criticisms. The criticisms around the paperwork burden of the code have been reduced significantly. On the committees on the 20 regulatory issues, it's largely completed. There are a few bits and pieces of work that are carrying on, and when the staff is here, we can probably elaborate on that.

G. Abbott: The minister's right, and I apologize. The issue of fibre cost is in part a stumpage issue and in part a code issue. The minister's right: there is some difficulty in breaking it up in a precise sort of way. I appreciate that he's got the challenge of having the right staff here at the time.

Let me, then, given that we want to just put aside the fibre cost part of this and hopefully move on to the code part -- although again, the interplay of the two things sort of brings us back and forth between them. . . . I spoke this morning about the comparative average stumpage rates in B.C., Alberta, Ontario and Quebec. The minister was right: the KPMG study had not addressed that. I indicated that possibly it was the IWA in one of its reports that had, and it is in fact the case that this is from the IWA.

This is as of March 1998. In this comparison -- and the source is provincial government forestry and natural resource agencies and IWA-Canada -- we see the B.C. coast, with the highest per-cubic-metre cost for stumpage, at $33.80 a cubic metre, the B.C. interior at $28.87 a cubic metre and the B.C. average at $30.01 a cubic metre. That was compared to $14.45 a cubic metre in Quebec, $9.50 a cubic metre in Alberta and $9.45 a cubic metre in Ontario. Those are the comparisons that the IWA made with respect to that. In percentage terms, B.C. in this study exceeded Alberta by 203.9 percent, the B.C. interior exceeded Ontario by 205.5 percent, and the B.C. interior exceeded Quebec by 99.8 percent. Those are figures from the Ministry of Forests, or provincial government forestry and natural resource agencies, which are put together by the IWA.

[1515]

[ Page 13895 ]

Hon. D. Zirnhelt: Well, let's go back to the study. The IWA study said that $33.80 was the B.C. coast. It was reduced on June 1 by $8.10. So that's the new baseline, if you will. The interior stumpage, at $28, was reduced by $3.50. Now, the $8.10 and $3.50 reductions, when you factor in the volume differences, give us an average of $4.89. So the stumpage rate in the interior currently -- January 1, 1999 -- is $21.13; on the coast -- January 1, 1999 -- it is $19. So there have been additional reductions since June.

So where the IWA study said that the coast stumpage was $33.80, in fact, by January 1 through to January 31, 1999, we're just under $20, at $19. So there's been over a $13 reduction there, and the coast. . . . We're talking about the actual billings now -- not the rates, but what they actually billed. That was the average. And the billings in the interior, January 1, 1999, to March 31, 1999 -- the latest period for which there is information -- were down to $21, about a $7 reduction from those figures that are used in the IWA report. That IWA report was for the period before we made the reduction and before there were additional market reductions.

G. Abbott: That's the point I was making -- that in March '98 these were prior to the changes to the superstumpage which were announced effective June 1, 1998. The question I have -- and perhaps staff do not have this information available -- is the extent to which that narrowed the gap. We know that part of it was the June 1 reduction, and part of it was market-based reductions in stumpage. I don't know whether you have this information or not. Did Alberta, Ontario and Quebec also see market-based reductions through that period in time, or were their systems working differently?

Hon. D. Zirnhelt: We don't track stumpage in other provinces because of the interprovincial comparisons. We wouldn't know whether we were comparing apples to oranges, and it's not our business to track other provinces.

The question remains. No one in industry has asked us to reduce stumpage further, so we're debating about it. Yes, it's higher. We've said that. I don't know what more you want or expect. If industry isn't asking us to reduce it. . . . I've challenged industry; I've asked them: "Do you want us to further reduce stumpage?" The answer is a resounding no. Obviously they don't have a problem with the stumpage rate.

G. Abbott: I thank the minister for his patient response to my questions on stumpage. I'll look forward to seeing the issue as it plays out through any future processes that may occur here in the province.

Over the last year or two there were some discussions around the sawmill assessment manual and whether that was going to be revised. Has the possibility of changes to the sawmill assessment manual been dismissed, in light of the concern around increases to cost drivers?

[1520]

G. Abbott: A year or two ago, changes to the sawmill assessment manual were contemplated, which would have had the effect of increasing the property taxes on sawmill equipment primarily. There is an elaborate document called the sawmill assessment manual, and there were some changes being contemplated which were of some concern to the industry. Has the possibility of changing that been dismissed?

Hon. D. Zirnhelt: We would have to check. We haven't heard anything.

G. Abbott: We talked previously about energy costs in British Columbia, and I think we arrived at the conclusion that that was still under discussion. Is the staff here available to turn fully to the code issues now?

Hon. D. Zirnhelt: Yes, they're on their way. We got back into other things, and they will be on their way.

I wonder if we're finished with the cost drivers. Or do you want to pursue that further?

G. Abbott: We are finished with it, apart from cost drivers that may be a part of the code -- so hopefully, yes.

Hon. D. Zirnhelt: Since we are waiting for staff, I'll call a short recess of five minutes.

The committee recessed from 3:23 p.m. to 3:31 p.m.

[W. Hartley in the chair.]

Hon. D. Zirnhelt: In the break I got some information, and we now have the staff here. At the time we announced the symbolic reduction from six plans to three, we actually measured the plans. Given that they were no longer necessary, we feel confident that that's the order of reduction. As I said, we don't hear about that from industry. Not one person has told me that we haven't reduced the amount of plans and hence the paperwork.

With respect to the 20 items -- policy regulatory issue items -- we have delivered on about 99.8 percent of the work. There is a little bit of work left to be completed, and that's on section 41, where we added the economic test in the decision-making of the district manager. So we've delivered on 19 of the 20. The one we're still waiting on is in industry's court. Industry has been asked to submit some information on that, and we're waiting for that now.

G. Abbott: The Ministry of Forests and the Ministry of Environment in a news release of April 2, '98, entitled "Forest Practices Code Amendments Reduce Costs, Maintain Environmental Standards," set out the changes and regulations for operational planning that they hoped to achieve. It says:

"Changes made in. . .operational planning, forest road, silviculture practices and timber harvesting practices include: moving towards a more results-based code, focusing on results on the ground, not paperwork; reducing the number of plans from six to three; cutting the paperwork by half; eliminating unnecessary reviews and uncertainty around plan approvals; ensuring strict environmental standards are maintained for timber harvesting; and improving enforcement of the code."

[ Page 13896 ]

Again, my recollection is that of the three plans that were eliminated, there was a fair quantity of that material rolled over into the remaining three plans. So the minister, in concert with his staff, can tell me where they're at in terms of reaching the goal of cutting paperwork by half.

[1535]

What we have eliminated is the duplication and the overlap. It's still as important to show access, but it can be done as part of the forest development plan. As such, we now have reduced the number of plans and planning requirements. So we've eliminated the duplication, which is what we set out to do.

G. Abbott: We've already discussed what that means in terms of the elimination of volume of paperwork. I don't know that there's any point in me pursuing that any further.

The other objectives were. . . . The first objective was "moving towards a more results-based code, focusing on results on the ground, not paperwork." The ministry itself has provided an interesting and useful example of a results-based code in the recently released "Forest Practices on Private Forest Land," which accompanied Bill 68 or whatever it was that we recently received in the House. That, I guess, would probably be as simple a results-based code as one would expect to find anywhere in the world.

When the minister indicated that they wanted to move to a more results-based code, what did the minister have in mind, or what did the government have in mind? Obviously the Minister of Environment comes into play here as well. What does the government have in mind in terms of the ultimate results-based code that it wants to see in place in British Columbia? Presumably it is something rather more complex than the private forest lands code. But is it more streamlined, less volume-less process-oriented than the current code we have in place in British Columbia? Or from the government's perspective, have we pretty much achieved the "ultimate results-based code" for B.C.?

Hon. D. Zirnhelt: No one would say that we've achieved the ultimate results-based code. The private lands code is too simple and doesn't cover enough values to meet the standards of good forest management on Crown land. There are more values to be protected on the public portion.

When we made the announcement about moving towards a more results-based code, we referred to what we said at the time was the results-based silviculture prescription. We could move with respect to saying that we want certain types of reforestation, certain stand densities. We could set out these goals, and we wouldn't prescribe how industry was to achieve that step by step -- when they would plant, how they would plant, what stock they would plant, etc. We just said: "These are the results." In that respect, we moved in an area where there was sufficient agreement that we could achieve the results by suggesting that we put the results in the plan, and then we leave it to industry to come up with the results. So we've actually eliminated the five-year silviculture plan, which I neglected to mention. I think that's an explanation of where we're at.

[1540]

I guess where I want to go from here is to get a sense from the minister as to whether, based on the experience of the past few years and based on the audits, which have come from the forest practices branch or whatever they're called, that indicate that most of the players out there are doing a darn good job of meeting the objectives of the code. . . . Based on that, can we take the example of the elimination of the five-year silviculture plan and be looking down the line to the elimination -- or the reduction, at least -- of the government's oversight of other areas of forest management?

Hon. D. Zirnhelt: As I've said before, we invited people -- and I included the ministry in the invitation -- to come up with what they could on a results-based code, and we're back to needing to be very clear about what on-the-ground objectives we want to achieve. We understand that foresters, biologists and others can then write prescriptions that point to the results we want to achieve. It really is a function of detailed, on-the-ground, site-specific land use planning, including timber harvesting. That's what has to be done.

Much of that work needs to be done, and we've only now been able to get the industry's agreement on how we can proceed with landscape-unit planning. In the absence of these land use goals, it's very difficult to set forth a performance-based code. We will have a chance to discuss some of this when we debate the bill that I introduced just yesterday. What we've said is that we will allow for the provision of an override on the code that we have now, in order to introduce pilots. So we will walk before we run.

Gordon Baskerville, who probably knows more about the code and the position of various people on the code, has said that we could not move today even if we wanted to. It would be foolhardy to move forthwith -- meaning today -- on a results-based code, because it will be the product of much discussion by the public and others. Clearly, in my mind, a results-based code will be one where we have confidence that the public and the government and the stakeholders know the results that we're trying to achieve.

G. Abbott: I hope that the pilot programs are remarkably successful and that we see further progress in the way of enhancing professional accountability. I think that's the key here.

The last point mentioned in the news release of April 2 is that the government will be moving to improve enforcement of the code. It's not clear what's meant by that. Can the minister advise what problems they currently see -- or did

[ Page 13897 ]

[1545]

The improved practices that we sought to achieve through enforcement was the. . . . I want to add that, at the minister's request, we asked them to conduct this audit, so we knew where the enforcement was a bit lax and where we had to get improvement. But we have improved practices as a result of the maintenance of riparian reserve zones adjacent to medium-sized and small fish streams and streams in community watersheds; the code regulations that prohibit cross-stream falling and yarding of trees, unless they were required for worker safety; the code requirement for cutblocks, roads and landings to be located and designed to minimize disturbance to streams; the code regulations requiring roads and logging trails to be constructed, maintained and rehabilitated in a manner that minimizes sediment delivery to the streams; the code requirement for professional foresters to address stream management and operational plans; and the code framework placing a greater degree of accountability on licensees to achieve stream protection objectives.

Similarly, there had been efforts to ensure the protection of habitat, wildlife trees, old growth and soil conservation. Those have all been efforts that we ask our agencies to be vigilant about in order that we can improve our compliance through enforcement measures, if necessary.

G. Abbott: I thank the minister for that thorough explanation. Just to summarize what occurred, what I'm understanding is that in April 1998, there was a concern about the effectiveness of the enforcement of the code. The ministry addressed that by doing an audit. They had a lot on, basically, how well stream management was carried out by the licensees and found a complete, or virtually complete, recognition of the requirements of the code in those terms. I'm presuming that, based on that, the issue of improving enforcement of the code is perhaps something that has been set aside or that there is some acknowledgement on the part of the ministry that the existing mechanisms for code enforcement appear to be working adequately. Is that a fair summary of where we're at on this issue?

[H. Giesbrecht in the chair.]

Hon. D. Zirnhelt: No, we haven't backed off. As a matter of fact, there was some criticism that we weren't out in the field enough. We sought to make it possible for people to go out for hands-on inspections. So we did 31,000 inspections last year, and this year we will be attempting to make 47,000.

[1550]

Hon. D. Zirnhelt: Well, we are minimizing the layoffs. We can't say there will never be a layoff of enforcement officers, because they may move around, or whatever, but we will be doing it with existing staff. Most of the position reductions have come about as a result of FRBC staffing for the work that needed to be done under the legislation to effectively carry out our responsibilities to manage the forest for those programs that were FRBC.

G. Abbott: While we're on the issue of enforcement, I've had an inquiry, and I frankly acknowledge my ignorance around code enforcement. There was an issue that arose, I guess, in the context of Bill 47 and the 20 recommendations and so on that came out of it around the issue of due diligence and liability to contractors versus licensees. Given the penalties that are in the code for failure to live up to the code, I understand that, the issue about due diligence and the apportionment of liability between contractors and licensees is a big issue. Can the minister advise what the conclusions were, with respect to that issue, that came out of the Bill 47 discussions? I hope I'm making sense here, because again I'm in an area where I don't have a lot of knowledge.

Hon. D. Zirnhelt: Due diligence is not a defence when it comes to whether or not an offence occurred, but due diligence is recognized at the time a penalty is levied. It may moderate the penalty, because due diligence is accepted as a defence at that time. That's the conclusion of that work.

G. Abbott: I thank the minister for the explanation. Does that principle which the minister has just enunciated find its way into policy somewhere, or is it more an issue of law?

[1555]

G. Abbott: Again, I thank the minister for that explanation.

The Forest Practices Board has a role in the enforcement of the code. It's not something, I think, that we've ever talked about before in estimates. Perhaps we have, but not recently, in any event.

Based on what the minister has seen of the Forest Practices Board and its work, does the minister believe that that board has a long-term, continuing role in enforcement? Or

[ Page 13898 ]

I think we've seen something like 15 investigations and 15 audits from the Forest Practices Board since '94-95. Has this part of the enforcement process worked as the minister or as the government anticipated? Or is there any thought of reviewing the way in which that part of the enforcement equation is provided?

Hon. D. Zirnhelt: Well, the Forest Practices Board isn't really an enforcer as such; it is an auditor. But it has a continuing role. So I would see a status quo with respect to the policy there.

More inspections just seem to me to reflect the fact that the public wants us to be vigilant about our inspections of what's going on, to prevent and mitigate problems that might occur. As we get more efficient at the paperwork part of the code enforcement and administration, we are able to be on the land more. I think that's where the officials should be.

G. Abbott: Could the minister, again, provide an explanation about how enforcement will be provided with respect to the private forest lands? We'll undoubtedly be discussing that in the context of the coming bill. Just for my information. . . . I understand that it would probably come from the Forest Land Commission, although, subject to the approval of another bill, it won't be the Forest Land Commission anymore, either. In practical terms, how will enforcement be provided on private forest lands?

Hon. D. Zirnhelt: The Forest Land Commission will do whatever enforcement there is, and there will be no role for the Forest Practices Board in that. We can get into the details when we debate the legislation.

G. Abbott: The ministry, in its review of the Forest Practices Code implementation. . . . I don't have a date on this particular publication, I don't think. Perhaps I do: June 15, 1996. The author from the Ministry of Forests suggests: "The system continues to improve in a variety of ways, including through the joint ABCPF" -- the Association of B.C. Professional Foresters --"ministry-industry task force on professional accountability, which is expected to report this summer." I appreciate that this is almost archival material now. But whatever became of the suggestion that there would be a joint professional forester, ministry and industry task force on professional accountability? Did it come to fruition at some point and provide some guidance with respect to that issue?

[1600]

G. Abbott: I'm slowly working my way through the sundry issues associated with the code that we should deal with. One of the proposals in relation to the code that I think came out of the 30-day list was a proposal to implement the intent of the 75 percent rule in green-up. Can the minister advise where we currently sit with respect to the implementation of the 75 percent rule in green-up?

Hon. D. Zirnhelt: Yes, that's been implemented. The OIC was passed last fall.

G. Abbott: I think we have covered off the details we need to with respect to that.

I have a few questions around the Kootenay-Boundary land use plan, if I can just find my notes on that particular topic. There is some concern about that plan or at least a suggestion that that plan should become a "higher-level" plan. Can the minister advise. . . ?

This is no news to the minister -- that there's some concern about that. I wasn't a part of it, but I understand that there have been some meetings with cabinet and caucus and so on about the issue. What are the implications of moving the Kootenay-Boundary land use plan to a higher-level plan?

Hon. D. Zirnhelt: Forest practices are now conducted in the Kootenay region under the Forest Practices Code. The code says that if there are other objectives that might be desirable -- economic, social, environmental objectives -- that result from a planning process such as what we had in the Kootenay. . . . If you have a land use plan, you can enshrine it in law, and then that becomes the pre-eminent law that guides forest practices. It is then the instruction to the statutory decision-makers.

G. Abbott: So when the plan is in place as a higher-level plan, will it have a different level of impact than the rules and regulations which currently exist there? In short, will there be some quantitatively measurable impact in terms of timber supply, for example, or costs, as a second example?

[1605]

There are implications, from just how we implement it, for operating costs. The flip side of that is that if you minimize operating costs, you may increase the negative impacts on environmental accounts, whether they're grizzly, caribou or whatever. While there may be. . . . Depending on which option is taken for implementing it, there will be a variation of the costs and benefits associated with it.

G. Abbott: In short, then, there will be quantifiable impacts on costs and, I guess to a lesser extent perhaps, timber supply. What is the administrative or political route at this point in time, before the higher-level plan status is ascribed to the KBLUP? Is there a process that the ministry is going through to ensure that when the plan achieves that higher-level status, the impact is going to be minimized? Or are there other factors at play here? I mean, how. . . ?

We've been discussing all through these estimates the importance of containing and reducing costs and so on. It

[ Page 13899 ]

[P. Calendino in the chair.]

Hon. D. Zirnhelt: While the member characterizes the costs and problems associated with implementing the plan, I would say that it's more appropriate to say that there are costs and benefits of not implementing the plan, and costs and benefits -- maybe different ones -- of implementing the plan. I would say that if you take an undue risk with respect to the existence of caribou, that is a cost. I think we have to be aware, when we're talking about plans and codes, that we have to look at the balance of what are costs and what are benefits.

We have never said that we would make the Kootenay-Boundary land use plan a higher-level plan, but consideration is being given to making it a higher-level plan. It will be done by the three code ministers: Energy and Mines, Forests, and Environment. Those three ministers have to sign off and declare the plan a higher-level plan should that be done.

G. Abbott: But the point is that no decision has been made at this point around making the KBLUP a higher-level plan. That is still under consideration, but the decision has not been made. Is that correct?

[1610]

G. Abbott: If the decision is ultimately made -- and I'm not suggesting that it should -- to ascribe a higher-level plan status to the KBLUP, will there be a transition strategy put in place to ensure that when the impact of this is translated into the different operating areas of the different licensees, the impact will be minimized?

Hon. D. Zirnhelt: With the changes over the past couple of years to the Forest Practices Code Act, any approved cutblocks are gated. Their approval has been given and won't be reconsidered as part of the forest development plan process. As you know, the forest development plan process is updated annually, and we can make amendments over a period of about four months. If in any region, with or without a land use plan, it's ever necessary to make what you might call transition adjustments, that can be done. But there is a notice of review and comment period, which is 60 days, during which people can comment as to the need to maybe modify operational plans according to impacts that might be prescribed in the higher-level plan that has been put out for notice, review and comment.

G. Abbott: Given that some of the concerns -- at least, that I've heard about -- with respect to the higher-level plan issue came from the industry, has the industry taken the opportunity to comment with respect to the possibility of the movement of the KBLUP to a higher-level plan? Have you received some. . . ?

Hon. D. Zirnhelt: Yes, the industry has had very long and involved opportunities. They comment, they're always talking to us, they have met with ministers, they've met with MLAs, they meet with our senior officials, they have written to us, and they have raised concerns. Our approach would be to minimize the costs to environmental and timber accounts and economic accounts, and we will maximize the benefits to those same accounts when we make a decision.

G. Abbott: We talked about the issue of the identified wildlife management strategy previously, to some limited extent, and we did talk about the cost to the industry. As I recall, the minister said that the aim was to keep the cost of that within a 3-cent-a-cubic-metre average and that there might have to be some consideration given to parts of the province where the list of identified wildlife might come particularly into play.

In one of the backgrounders that was provided to the news release of February 19, 1999, with respect to identified wildlife, there is a list of 36 species or subspecies which are identified as "identified wildlife" -- if that doesn't sound too silly -- as well as four plant communities that have been identified. Can the minister advise how the list of 36 species or subspecies that appear on this list was determined? What were the criteria used to compose the list of 36?

[1615]

G. Abbott: The impact of a species appearing on the list. . . . I guess I'm curious as to what the implications are to the appearance, for example. . . . One of the few that I know on here is the western grebe, which finds its home, in large measure, on the shores of Shuswap Lake around Salmon Arm. I don't know how many western grebes nest in trees that might be harvested; not too many, I suspect.

But for some of the other ones -- the mountain beaver, the mountain goat, etc. -- what are the implications in terms of the existence of this? The grizzly bear would maybe be a better example, because we find the grizzly bear in a lot of the forest land of British Columbia. What are the implications of an animal being on the list as opposed to not being on it? Is there a more severe management regime for some of these species than for others? Or is the implication of being on the list the same, regardless of the species?

Hon. D. Zirnhelt: The difference is that there are no mapped features for habitat for species that are not on the list. If the species is on the list, like the grizzly, then there would be features that would be marked and part of the planning process. The example would be that the necessary habitats are estuaries where they feed. But they also need screens to protect them from predators -- man, perhaps. The access would be planned in relationship to the habitat needs. The features that are needed by those species are then put on the maps, whereas they aren't for those species that aren't on the list.

G. Abbott: So in practical terms, when the identified-wildlife management strategy sort of hits the ground, there

[ Page 13900 ]

[1620]

For those that are on the list, mapping is done by the government and provided to the licensees by the two government departments, MOF and MOE. Then the management practices for those species within those features are stated in the ID wildlife management guidelines.

G. Abbott: So it could be, it seems to me, as simple as this: for example, Evans Forest Products, up in my neck of the woods in the North Shuswap to West Columbia, through the area out to Golden. . . . Virtually all of the operating area of Evans Forest Products, I expect, would fall within the map designation showing the existence of grizzly bears. I suspect there is nowhere in their operating area that there would not be grizzly bears. So Evans receives the map; they receive some management guidelines or direction with respect to managing the habitat for grizzly bear. Then they are expected, presumably, to just build all that into their operating plans and their cutting permits and so on.

Is that the way in which we are going to be able to implement this, with as small a cost as 3 cents a cubic metre? Presumably, if we're going to be doing much more in the way of direction or management, the cost would be more significant than that. Would that be a fair way to describe how this is going to be implemented?

Hon. D. Zirnhelt: The 3 cents a cubic metre is sort of an average across the whole region. There are going to be some areas where there may be a higher impact. There is a 1 percent budget under the code for identified wildlife, so some grizzly habitat will be protected in that 1 percent. If there are going to be larger impacts, if that isn't sufficient, then there will be a social decision -- a political decision; a policy decision, if you will -- made around protecting the species through higher-level plan designation, in which case the various factors about implementing costs and so on will be taken into account at that time.

G. Abbott: I'm not sure I take as much comfort from that response as I was looking and hoping for. One of the press releases around this issue -- again, February 19, 1999 -- suggests that the implementation of the strategy is expected to affect less than 1 percent of the working forest in B.C. The reason why I have a concern that it will be more than 1 percent is that if we take the grizzly bear alone -- and just knowing the area of the southern interior that I live in, I can't help but imagine, unless the process is going to be implemented in the way in which I suggested, which is a provision of maps and a provision of guidelines and saying: "Go about it in a way that's not going to see the reduction in grizzly bear numbers. . . ." If something more elaborate is in mind, I can't help but think that there will be a greater impact than 1 percent of the working forest.

Grizzlies, at least in my part of the world, are not at all unusual. There's a fair number of them around, and it's not unusual to get the heck scared out of you by them. How are we going to do this in such a way that, particularly for the part of the world I'm talking about, we won't see more than a 1 percent impact?

[1625]

G. Abbott: Maybe I'm failing to ask the question in a way that's clear enough, so I'll try it one more time, and then I'll leave this. What I'm looking for is a simple and concise explanation of how, from the perspective of a professional forester who is being advised on an issue -- i.e., the identified-wildlife management strategy. . . . He's going to receive maps on his desk. He's going to receive guidelines or directions with respect to management of particular species at risk. Is that going to be, from the ministry's perspective, the way in which this strategy is going to be implemented, or. . . ?

The minister has made reference to: "Well, we may have to make other laws and stuff." Well, if that's the case, maybe we can just get a clearer explanation. If we could just sort of get a clear understanding in simple terms of what it's going to mean to people trying to implement this at the local level and what that means in terms of how this is going to be implemented and administered from the provincial level. . . .

Hon. D. Zirnhelt: I think what I said is that there are a number of ways to protect wildlife. There are the general practices; there's the management of the habitat, which has been budgeted 1 percent as part of the features that will be on the maps that are provided to professional foresters. We have said that if that isn't sufficient, then there has to be a different decision made, and it would have to be made through the higher-level plan, not through the code as it is. The code as it is prescribes a 1 percent budget. Now, if that isn't enough, then a social decision has to be made that through a higher-level plan, there will be additional protection measures made.

[1630]

The government, in a press release of March 25, talks about a new Forest Practices Code technical manual to assist agency planning staff or, presumably, industry planning staff

[ Page 13901 ]

Hon. D. Zirnhelt: The policy around the code suggests that there was a 6 percent budget for timber supply -- a 6 percent impact on timber supply. So there are two areas of biodiversity: there's the stand level, and there's the landscape level. Within the stand level, we expect that this impact would be 1.8 percent, and the landscape level would be 2.3 percent, totalling 4.1 percent. So biodiversity is protected with a budget of 4.1 percent.

The wildlife trees would be accommodated in the 1.8 percent, which is the stand level. The old-growth budget, if you will, can be accommodated in the 2.3 percent, which is the land-use-level biodiversity budget.

G. Abbott: As the minister answers the question, he can first of all, again, explain to me the difference between the 4.1 percent and the 6 percent, which was the figure used initially; that's one issue here.

The second issue in terms of the "Landscape Unit Planning Guide" is: does this 4.1 percent reduction come on top of all the other constraints and reductions and so on which already affect the cut in the province?

Hon. D. Zirnhelt: As a matter of policy, in February '96 we announced the impacts. So it's been known by industry since that point. The 4.1 percent is the budget of impacts for biodiversity. But included in the rest we have riparian protection, watershed protection and identified wildlife.

[1635]

Hon. D. Zirnhelt: The impacts will be picked up either in this round of AAC determinations or the next one, which follows in five years. When the AAC is determined, we look at current practices. To the extent that these become current practices, they are accounted for in the AAC determination.

When the 6 percent provincial budget was announced, we knew it would be higher in some areas and lower in others. It's variable by region, by geoclimatic zone and by many other factors.

G. Abbott: Given that we all agree that 12 percent of the province's special areas should be set aside for the protection of biodiversity and other special features the province has to offer, when this is applied to areas that may be particularly blessed with biodiversity or particularly blessed with old-growth forests that have not received the protection of park or protected-area status, does that mean that in those kinds of areas this "Landscape Unit Planning Guide" could have an impact perhaps double or triple the 6 percent? Or is there some constraint on the amount that this one element -- the "Landscape Unit Planning Guide" -- can impact on the cut? In short, is there an upset figure in terms of how much the chief forester is going to take this into account in setting out the timber supply in a particular area?

[1640]

G. Abbott: The Okanagan-Shuswap is going through their land use planning exercise and identifying as a part of that, I guess -- at the critical stage they're at -- some areas which perhaps should be set aside as additional protected areas, and so on. Will those areas where, by consensus, there is agreement to set aside be factored into the 2.3 percent? Or will that always come on top of those areas that are set aside through the land use planning process?

Hon. D. Zirnhelt: To the extent that in a land use planning process they create 12 percent of the land base in parks and incorporate old growth into those protected areas, there will be less impact outside. So part of the art of land use planning is to achieve your many critical objectives. If you achieve your objectives of conserving biodiversity and effectively using your protected areas to do that, that takes the pressure off the other areas. It is expected that beyond the 12 percent, there will be an impact on the remaining working forest and working zones. That impact will be more or less, depending on the situation.

Let me give you an example. In the Nelson forest region -- which is part of the Kootenay-Boundary land use plan -- the way it works is that the budget for code impacts will be about 8.3 percent. There are other areas where it's considerably less, so this is on the high side of the provincial average. In the case of the Shuswap, they will be working towards a budget of protected areas, and they'll be trying to optimize the protection. Because they have less room to move -- I think, in particular, because of private land -- they'll be trying to achieve as many objectives as they can with the protection and conservation budgets that they have.

G. Abbott: I think we're getting closer to the issue that I'm concerned about. Again, I can give an example so that the minister can appreciate why this would be a concern in this case. The LRMP process is in the later stages in the Okanagan-Shuswap. They're probably 80 percent to 90 percent complete at this point in time. They are making the difficult decisions that need to be made near the end of that process.

[1645]

[ Page 13902 ]

One of the realities in terms of land use planning within the Okanagan-Shuswap is that in comparison to other parts of the province, there hasn't been 12 percent of the land base set aside. I think something like 3 percent or 4 percent of the Okanagan-Shuswap has been set aside as park or protected area to this point in time. It's a far smaller amount of area than would be the average over the province. Undoubtedly, that will increase somewhat as the difficult conclusions are reached around protected areas and so on in the Okanagan-Shuswap LRMP.

If there are -- from the perspective of the "Landscape Unit Planning Guide" -- concerns around old growth and wildlife trees that come into play in the Okanagan-Shuswap on the one hand, and, on the other hand, we don't have big areas set aside for park and protected areas, could it be that. . . ? For example, the impact of the "Landscape Unit Planning Guide" could be as much as 10 percent or 15 percent of the AAC in the Okanagan-Shuswap. I hope I've framed that in a way that the minister and staff can deal with. I think it is a real concern, but perhaps the minister can set out ways in which we can be assured that such an impact would be mitigated -- if it, in theory, can occur.

Hon. D. Zirnhelt: Let me try to answer this. If they choose to have 6 percent, or 8 percent or 10 percent, then there may be old growth protected in that area -- more, or less, depending on what's available. But outside that area, they still have to come into the provincial budget of 2.3 percent across the province. If it's more in the Okanagan, it'll be less somewhere else. But I don't see any factor that would drive that up. I mean, there may be factors, but I'm not aware of them.

G. Abbott: Hopefully, we're getting closer here. So the 2.3 percent average for the province is going to be 2.3 percent in the Okanagan-Shuswap, as well, regardless of how much is set aside for park and protected area?

Hon. D. Zirnhelt: The 2.3 percent is a provincial average. I don't know whether it'll be more than that; it'll depend on how successful landscape unit planning is. It is outside the protected areas; that's where the goal, across the province, is implied. I'm saying that if it's more there, then it's less somewhere else. So you can be sure that in each region, everybody's trying to keep it down. If somebody pushes it up in another area and makes it have less than 2.3 percent, then there will be countervailing pressures.

As I say, it depends a bit on the uniqueness of the area. For example, I don't think the grizzly bear strategy in the Okanagan-Shuswap is contemplating restoring that particular critter to that particular habitat. I don't think that's part of the grizzly strategy. I think they're aiming to conserve where they exist. You won't see pressures on the old-growth budget for grizzly, for example, there. There may be pressures for other reasons; I don't know.

[1650]

[E. Walsh in the chair.]

Hon. D. Zirnhelt: We don't know, because the Okanagan-Shuswap land use plan may well accommodate the values that need to be accommodated under the objectives of the 2.3 percent outside-protected-area budget. If the land use planning process is successful in protecting those values in protected areas, it will reduce the pressure. If, outside the protected areas, there are species that need to be protected, then there will be upward pressure, but we don't know that and won't know that until the Okanagan-Shuswap land use plan is finished. Where the impacts are higher than that 2.3 percent in any given area, there will be efforts to mitigate the impacts of a higher amount in any given area.

G. Abbott: Again, I don't want to spend the rest of the day on this particular initiative. But we'll certainly be looking to see effective mitigation strategies put in place, because the cumulative effect of this range of initiatives that we have been discussing can be very considerable in terms of the annual allowable cut. The individual initiatives may be wonderful, commendable and so on, but we always, I think, have to bear in mind that when we pile one on top of the other -- a range of initiatives beginning at bedrock with the code, and then protected areas and the sundry other initiatives that we've been discussing -- the impact on AACs can quickly get up into the 15, 20, 25 percent range and have a very dramatic impact on the jobs that can flow from the resource as a result of that. So I'll leave that thought with the minister. He may wish to comment on it -- or not.

One of the interesting things that has happened in the year since we last met in these Forests estimates is the concept of variable retention. I think we want to spend at least a few minutes on variable retention, because I've had the opportunity to go out and have a look at some of the stands that have been harvested using the so-called variable-retention system. It certainly strikes me as a system that may have some interesting possibilities and implications for the future of harvesting in British Columbia. Certainly it's not a system that is going to work in every forest type in British Columbia, and I think the minister and I already agree on that. There are many different forests in British Columbia, and some probably wouldn't lend themselves to this type of harvesting arrangement. But there are certainly a number of them that would.

I invite the minister to provide his comments with respect to variable retention and what efforts are underway in his ministry to study the impact of variable retention, if it were to be applied, for example, to Crown lands, as well as to the private lands where it is currently being undertaken by M&B. I guess there's a little bit of question about whether that'll be extended once Weyerhaeser assumes ownership of MacMillan Bloedel. TimberWest -- I think yesterday or very recently -- announced that they are going to be moving to variable retention on their private lands, at least. Obviously this is a system that we are going to have to come to grips with in terms of its application to public lands. How is the ministry setting about to analyze, to explore the application of variable-retention cutting systems to Crown lands?

[ Page 13903 ]

[1655]

We have eight years of study of partial-cutting methods that we were able to incorporate into the amended regulations that deal with variable retention. In March we brought out changes to the timber harvesting regulations that that said these are acceptable practices, this is how we treat them, and these are the sorts of prescriptions and guidelines that you need to know.

G. Abbott: Is the ministry looking at the application of variable-retention harvesting systems in conjunction with some of the issues we've just discussed: the old-growth trees, the wildlife trees, the identified wildlife management strategy. . . ? There's a whole bunch of issues that could be impacted by a new cutting system like variable retention.

I've always been fascinated by the debate around the cutting systems that are incorporated in the code and the arguments of some professionals like Clark Binkley, for example, who argues that some of the ways in which the code has impacted in fact have been negative in terms of forest fragmentation due to roadbuilding requirements, too many small clearcuts in a pattern that is not economic in terms of harvest and in patterns that may in fact not serve the ends of biodiversity that they were designed for. This is a big question, but I guess I'll invite a big answer from the minister in terms of whether this whole debate is going to be changed by the variable-retention system -- if indeed it is widely adopted by licensees for both private and Crown land.

[1700]

This is work that's ongoing. Our policy and research people and managers are well aware of the literature around fragmentation. We are applying the best of the scientific knowledge around fragmentation in our planning processes. This is something that gets caught up as forest development plans are made -- as landscape unit plans are developed. These are all considerations that are taken into account at the time.

G. Abbott: I think we can move on a little bit here. The minister has touched on the standing timber inventory. The commitment was made -- I guess that perhaps it was part of the jobs and timber accord; and perhaps elsewhere -- to developing the two-year standing timber inventory. I understand, from the comments of the minister, that we're getting relatively close to that, somewhere in the neighbourhood of 1.7 to 1.8 years of STI on average across the province. Is that a correct figure?

Hon. D. Zirnhelt: The official who has that information will be joining us shortly.

The two years of wood ahead were an offer and an objective. We hear no complaints from industry about this now -- or few, if any. We were attempting to have industry engage with us in a process where they did certain things and we did certain things in order to achieve the standing inventory. In some regions we are very close to that; in other regions we are short of that. The objective was to provide it, but it required that industry do certain things. Wherever industry has asked for it, we have delivered. So to the extent that we were falling short of that objective, it was because there was no will to engage in a process to achieve that.

G. Abbott: Perhaps the minister can advise why, in some parts of the province, there would not be a will on the part of the licensees and the government to achieve the two-year standing inventory. I'm surprised that the industry would not be looking for that universally, and I presume that the government wants to accommodate that in every case.

The next question is. . . . I appreciate that I may have to wait a minute for the right staff person to come. This is, I guess, one corner of the code that it's going to be difficult to get the right person in for. I'm curious as to whether there are portions of the province where there is still significantly less than 1.7 or 1.8 years of STI provided -- whether the provision of sufficient standing timber inventory is still a problem in some parts of the province. Hopefully, you've got the right staff person here now, so I'll let the minister consult and then hear about that.

[1705]

You asked for a reason why the industry wouldn't want to do it. I think they have to undertake a cost-benefit analysis with respect to whether they want to put the money into the planning and development costs at that time. We can't approve anything if they don't plan it. If they choose not to spend the money for cost-cutting measures, then that's their choice.

G. Abbott: Let me go back to a question I asked earlier. It got bound up with the other one. Are there parts of the province that have standing inventory that is significantly less than the 1.38 years of STI? Does this remain an outstanding issue in some areas?

Hon. D. Zirnhelt: Well, there's two ways to look at it. One is: what are their fibre flow targets? In the case of the coast region, which is the one that falls quite a bit short of two years -- or the 1.6, on average, that they've asked. . . . In the Vancouver area they've achieved 95 percent of the fibre flow

[ Page 13904 ]

Another notable example of successful achievement here is the Cariboo, where we were as high as 1.9-something -- just under 2. Last quarter, it's fallen back to 1.89, so it's 1.9 effectively, which represents 100 percent of the fibre flow target. We could provide these details to you if you want.

G. Abbott: Certainly I welcome the details. I was principally concerned to see that the public policy objective of the two-year STI had been pretty much achieved through the province. The minister has adequately explained where we are at with respect to STI.

I don't know whether this requires a change of staff or not, but I think we can move on to section 6, which is the annual allowable cut reductions. Would the minister like a minute or two to get the right staff in? Or should we proceed?

Hon. D. Zirnhelt: Yeah, within two minutes we'll have the officials here, so we'll just pause for the officials to arrive.

The Chair: We will just recess for a couple of minutes, until the staff are in.

The committee recessed from 5:09 p.m. to 5:13 p.m.

[E. Walsh in the chair.]

G. Abbott: I'd like to move along now to the issue of annual allowable cut, the concern generally being those areas where the timber supply reviews have resulted in reductions to the annual allowable cut. I want to explore with the minister some of the implications of those changes and how the province may move to mitigate them, if that's possible -- in some instances, at least.

The Fraser TSA reduction was recently announced by the chief forester, and I think it was in the neighbourhood of 17 percent. I saw in the mail just a week or two ago, that the Mid-Coast TSA was also looking at a substantial reduction, although the volume there is relatively small. In other parts of the province we are at different stages in terms of the timber supply reviews.

Could the minister begin by essentially reporting out what the results of the timber supply reviews are, for example, in the Fraser and in other areas of the province where the chief forester has reached conclusions about timber supply and AAC. If he can outline those, then we'll proceed from there.

[1715]

The first has been Little Slocan in the Nelson region; the change there was an addition of 23 percent -- an addition of 15,000 cubic metres. The Mackenzie-Cariboo management unit, called Mac-Cariboo, in the Cariboo forest region -- that's a TFL. . . . These are TFLs. The first one was a TFL. So this is TFL 5. There has been an addition of 12,800 cubic metres, an 11.6 percent increase. In the Quatsino -- this is TFL 6, the Vancouver region -- the change was plus 202,000 cubic metres, which is a 15.7 percent increase in the cut. In the case of the Moresby, TFL 24. . . . Oh, that TFL has been eliminated, so it's gone to zero. It was a 115,000-cubic-metre reduction. In TFL 25 -- that's where TFL 24 has been moved to -- the reduction is 11.2 percent, or 87,000 cubic metres. In TFL 38 -- that's in Squamish -- there's been a reduction of 12,500 cubic metres, or a 4.8 percent reduction. In the Alberni area, TFL 44, there's been a reduction of 338,000 cubic metres, or a 15.2 percent reduction.

Then in the TSAs, in the Merritt area TSA 18 has had an uplift of 550,000 cubic metres, or a 37.8 percent increase. In the case of the Fraser TSA -- that's TSA 30 -- there has been a 280,000 cubic-metre-reduction, which is an 18.1 percent reduction. There has been a net reduction of 52,000 cubic metres or 0.1 percent.

G. Abbott: I'm always encouraged to hear about places in the province that actually have increases in their annual allowable cut. What factors would come into play there? In the part of the interior that I'm from, I'm more used to hearing about reductions in the AAC as opposed to increases. What accounts for the several areas. . . ? For example, let's pick out Merritt, where there's been a very substantial increase in the AAC. I think the minister mentioned 550,000 cubic metres and a 37.8 percent increase in the AAC. How would an increase in cut of that magnitude occur? Does it have to do with mountain pine beetle salvage or something along that line? Is that why that occurs?

Hon. D. Zirnhelt: There are three factors: (1) moving into problem forest types which haven't contributed to an AAC before; (2) the mountain pine beetle, as you correctly point out; (3) and fire.

[1720]

Hon. D. Zirnhelt: In the TFLs where there's been a long history of cutting -- hence more management coming into the second growth -- there will often be an increase reflective of the management practices. With respect to the other areas, any increase would not really be reflected on management practices so much. It's too early to bring that in; there hasn't been any kind of intensive management. Even backlog reforestation probably hasn't been incorporated to the extent that it would show an increase. There has been an expanding land base. At a general level, outside the TFLs it's because we're able to move into more operable forest with technology, planning and perhaps markets. With the technology of both harvesting and processing, you can expand the operable forest.

G. Abbott: I won't explore all of these, but I do want to just touch briefly on the significant ones that have reported out to date. In the case of the Merritt increase of over half a

[ Page 13905 ]

Hon. D. Zirnhelt: The problem-forest-type partition was done previous to this recent increase that's reflected here. This 500,000-cubic-metre-increase is virtually all because of mountain pine beetle and fire.

G. Abbott: Presumably, then, we certainly see additional timber available in the short term. Will we then, in the Merritt area particularly, be seeing some fairly dramatic downturn in AAC in the next decade or two, in order to compensate for the mountain pine beetle infestation that's occurring there now?

Hon. D. Zirnhelt: Yes. It's stable at the base case, not at the temporary uplift. So the temporary uplift will not negatively affect the base-case long-run sustained yield.

G. Abbott: I assume that that presumption is based on a hope that we will see an abatement in the mountain pine beetle epidemic that is currently underway in parts of the province. Presumably, if that problem continues, it will have an impact on the base down the line as well. Is that correct?

[1725]

G. Abbott: That's an interesting point. I wasn't aware that 100 percent of the cut is either beetle or fire damage. That's interesting.

The other major change in the upward direction of an AAC -- and I believe the minister mentioned it -- is in Quatsino. I'm not familiar with that. What's the reason for the dramatic increase there? It's up 15 percent, which is a substantial amount. Are we dealing with a bug-kill or fire-kill issue there as well, or is something else at play?

Hon. D. Zirnhelt: This is an administrative change -- sorry. There was an amalgamation of two TFLs. That explains that.

I just want to correct the record about Merritt. My statement is that for the regular cut, it is true that 100 percent is fire- and beetle-killed, but that's not true for the partition cut. There's a small partition in there of several hundred thousand cubic metres that is of the problem forest type. So that is in green, non-attacked, non-burnt wood.

G. Abbott: Thanks for that clarification. So we can attribute Quatsino, in its entirety, to new lines being drawn on a map and more timber being rolled into that area. The only other one I want to ask about is the 23 percent increase in -- I believe the minister said -- Little Slocan. Is that increase a product of administrative redistribution, or is it one of the three factors the minister mentioned at the outset that came into play in Merritt, for example?

Hon. D. Zirnhelt: We'll have to get back to you. We don't have the information on the rationale for the uplift for that particular TFL, but we'll get it for you.

G. Abbott: I'd like to turn, then, to some of the more prominent reductions that we have seen in TSAs and how we might deal with those. Let's begin with the Fraser TSA. That's the area, I guess, basically from Boston Bar on down through Hope and to the lower mainland and around the lower mainland area -- at least, that's the way I understand it.

We're looking at an 18.1 percent decrease there, or 280,000 cubic metres, which I expect, given the amount of milling and so on that's done in the area, may be a very significant decrease in the fibre flow to mills and licensees in the Fraser TSA. Can the minister begin by outlining the reasons for the reduction in the Fraser TSA and, more importantly, advise whether the government is looking at any measures which might assist in mitigating fibre supply problems to licensees and operators within the Fraser TSA?

[1730]

The biggest single contributing factor, then, is inventory, but we had inadequate inventory information. There was an audit done, which brought up our confidence level in the inventory information. So we now know pretty much what the inventory is in the area. Other downward pressures: a small amount from protected areas and some from spotted owls. In the case of the spotted owl and the protected area -- we've sort of generally called them land use decisions -- there was a mitigation strategy put in place where we went into advanced harvesting and commercial thinning in some of the second-growth areas.

G. Abbott: Could the minister provide, perhaps in percentage terms, how much of the reduction in the Fraser TSA was a product of the creation of protected areas and how much was a product of the spotted-owl management strategy?

Hon. D. Zirnhelt: I was just checking with the officials. Perhaps the easiest way is to go through a lengthy briefing on it. But the short answer is that they can't break it down in percentage terms with any kind of precision. There are hundreds of variables, and they overlap and so on. We're quite prepared to share some of the technical information based on the determination. But you can't categorically say X percent is for this and X percent for that. I would be happy to provide that if they were able to do it, but they can't.

[ Page 13906 ]

But I'm wondering, given the demand for fibre in the lower mainland area because of the many operations there, whether the ministry anticipates particular problems. Given that we're looking at an 18 percent decrease or a 280,000-cubic-metre decrease -- I think it was -- in the AAC, will that produce problems in terms of fibre supplies both to licensees and to those operations that currently secure their fibre supply on the open market? In short, should we anticipate problems there?

[1735]

In other words, though, a 300,000- or 280,000-cubic-metre reduction -- roughly 300,000 -- is a medium-sized mill. So there is excess capacity in the area. Some of those mills are temporarily down and may stay down. Depending on the fibre, I think there are still too many mills in the general coast catchment area. So they're not all dependent on. . . . An 18 percent reduction doesn't mean there's an 18 percent reduction in overall supply.

G. Abbott: That makes sense in the context of that region of the province actually securing 80 percent of its fibre from outside the region, then. Is that about the magnitude of what we're talking about?

Interjection.

G. Abbott: Okay, that's fair. That helps to explain the situation.

The other one that I want to ask about particularly here is the 15.2 percent reduction in the Alberni TSA or TFL. I got the percentage figure, but I didn't catch the volume figure. I wonder if the minister might note the volume figure again and explain what accounts for that reduction.

Hon. D. Zirnhelt: Sure. The volume reduction is 338,000 cubic metres, and it's 15.2 percent. TFL 44 is in the environs of the Clayoquot. A major portion of the reduction reflects impacts of the land use decisions in the Clayoquot.

G. Abbott: That certainly is a substantial reduction in that area. I would suspect -- I don't know. . . . The minister will be able to tell me, undoubtedly, whether one would anticipate fibre supply problems to the operations in the Alberni area as a consequence of such a dramatic reduction. The minister has explained that in the case of the lower mainland -- i.e., the Fraser TSA -- much of the volume comes from the outside anyway, so the net impact is less than one might anticipate, just based on the 18 percent figure. In the case of Alberni, is that true as well? Or are we looking at a more substantial problem there?

[1740]

G. Abbott: I'll try to resist, at this late hour of the day, making some rude or completely inappropriate comment about the consequences of the former Premier visiting different parts of the province.

Again, I can appreciate what the minister is saying in terms of the determination catching up to practices. The more important part of my question, though, was: are there going to be fibre supply problems to operations within the Alberni area as a consequence of this? And if so, how might those consequences be mitigated -- or indeed, is it possible?

Hon. D. Zirnhelt: Well, my view is that any mitigation that's going to happen is going to be on increasing the amount of wood that stays in the area for processing or secondary processing. But the impacts really are more because of reduced cutting that had to do with markets. Right now, as you know, there is pressure to export logs because they don't have a local market. The way we approach this is that if there is a mill that can't get supply, we go back and try to find out the reason. If the reason is because of the economics of harvesting, then we have been trying to do what we can through the log cost reduction strategy, allow different approaches to the timing of harvest and the valuation of permits, and so on.

We're trying a number of mitigation strategies to keep the flow of wood, but it's not because of AAC. It really has to do with whether or not you have a coastal market. Or in the case of some of those people operating in the Alberni area -- M&B in particular -- they don't have access to the U.S. market.

G. Abbott: The final example. I just want a quick explanation on TFL 25 -- the 11 percent reduction, or 87,000 cubic metres. Could we have a quick explanation of that -- why it occurred and the impact of it?

Hon. D. Zirnhelt: I'll get that information for you. But while you're waiting, I'll give you the answer on TFL 3. There are three main factors on TFL 3. There's 10 percent -- 10,000 hectares -- small-diameter, lodgepole pine that's been added to the land base. The old-growth site index has been adjusted, reflecting higher productivity. Then there's good regen management due to a genetically improved seed stock.

G. Abbott: The minister is confusing me at this late hour by answering a question I asked earlier. Now I've forgotten the question I asked the last time. But that's perhaps to be. . . .

[ Page 13907 ]

G. Abbott: Yeah, it's just late-afternoon trickiness.

I think the question was around the reduction in TFL 25.

[1745]

G. Abbott: That's close enough. That concludes all the questions I have on the AAC. I do have one colleague, who is unable to be here this afternoon, who has a question or questions around the Soo TSA. I don't know anything about that situation. But would it be acceptable to the minister that we come back tomorrow afternoon to deal with just that one small area of the AAC? Then we can move on to the forest health, fire protection and other issues that are laid out in the plan. If that's acceptable to the minister, I move 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.

Hon. D. Lovick moved adjournment of the House.

Motion approved.

The House adjourned at 5:47 p.m.

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