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)


THURSDAY, JULY 15, 1999

Morning

Volume 17, Number 1


[ Page 14459 ]

The House met at 10:05 a.m.

Prayers.

Orders of the Day

Hon. U. Dosanjh: I call committee on Bill 97.

MISCELLANEOUS STATUTES
AMENDMENT ACT (NO. 3), 1999

(continued)

The House in Committee of the Whole (Section B) on Bill 97; W. Hartley in the chair.

On section 11.

G. Plant: Section 11 is the beginning of a series of three sections that make some changes to the Expropriation Act. I think that these changes are in some respects unnecessary and deleterious to the interests of landholders. We're going to deal with these provisions in some detail, but I've just received some disturbing news which actually causes me even more concern about these provisions.

One of the fundamental principles of expropriation law is the idea that people whose land is expropriated are entitled to full compensation. Oftentimes governments don't offer full compensation, so there needs to be a process in place to adjudicate the issue of compensation. That process invariably involves lawyers, appraisers, business valuators and the like. Hon. Chair, you can readily appreciate that if a landowner is forced to litigate the issue of compensation, then any amount they have to pay to their lawyers and appraisers -- which they don't get full recovery for -- is in effect a deduction from the compensation they get at the end of the day. If they find that the government is acting unreasonably and are forced to litigate the amount of compensation they are entitled to, then they do that. There's a cost associated with that litigation. Unless they get that cost fully reimbursed, they're going to be out of pocket at the end of the day. They're going to have lost something. Their right to full compensation will have been impaired.

With that in mind, the general approach that governments traditionally take to the idea of costs for landowners whose lands have been expropriated is to ensure, through the processes that I'm talking about, that all reasonable actual expenses are paid to the landowner. My understanding is that that has been the practice in British Columbia for a very long time. I'm not an expert in expropriation law, but that's certainly my understanding as a general matter, and I've had that confirmed quite recently. I'm told that that practice is about to change. An order-in-council has very recently been passed, which will take away the right to recover actual and reasonable costs and replace it with a tariff. In fact, the tariff won't apply just to things like legal fees; it will also apply to things like appraisals.

[1010]

That seems to be a very unfortunate step in the wrong direction for a government to take in the expropriation process, because it seems to me that it gives government way too much power in the context of expropriation. It means the government can now use the leverage available to it by simply forcing landowners, by its intransigence, to accept amounts in compensation that are actually less than they are entitled to. The landowner knows that at the end of the day, if they go and hire a reasonable lawyer and a reasonable appraiser, they're actually going to be out of pocket for the amounts that they actually spend. I think they now will have to take a bigger risk when deciding whether or not to take on that big, unpleasant, often intransigent, frequently unreasonable entity known as the government, which has taken their land away -- or part of it.

That's all part of the context within which I now look at these provisions that are intended to change the Expropriation Act. I certainly was concerned about these changes yesterday, because I thought that the changes in the law that are proposed here are themselves deleterious. They hurt landowners. They are an attack on private property rights in British Columbia, but I wasn't certain about the scope or the breadth of the attack. I have some concern that the government has actually embarked upon a broader-scope attack on the idea of full compensation, because I've heard about this order-in-council. . . . It may well be that there will be some answer to all of that. The order-in-council that I'm talking about was approved and ordered just a few weeks ago, on June 25, 1999. It looks to me like a tariff-of-costs regulation and the kind of thing that is done in the Supreme Court rules. I'm told that it's a brand-new creature in expropriation law. It has never been done before in British Columbia. That may be wrong, but that's the information I've received.

Let me begin my examination of the provisions that we're talking about here by looking first at section 11. Section 11 rewrites section 40 of the Expropriation Act. The marginal explanatory note says that section 40 is about clarification -- that it's clarifying "that compensation payable on an expropriation in which part of the land of an owner is expropriated includes the market value of the owner's estate or interest in the expropriated land." That's the first part of the marginal note. I have asked people who practise in this area whether there was any doubt about this point -- that is, was there something in the act that was ambiguous or uncertain that required clarification?

I am told that there is nothing. There is no court decision that has recently undermined this understanding of the act. If you in fact read the other provisions of the act, it is painfully clear that in the case of a partial taking, a landowner is always entitled at least to the market value of his or her estate or interest in the land taken. That's the expropriated land. The question that arises is: what is it about this provision -- section 40 of the act -- that is unclear? Was there a court decision that people are unaware of, which has caused the government to come here and clarify section 40 in the manner contemplated by section 11(a) of this act, or what? What was the problem that needed to be fixed by section 11(a) of Bill 97?

[1015]

Hon. U. Dosanjh: First of all, going back to the tariff that has just been introduced and was made public on June 28 of this year, I believe, it's disingenuous on the part of my learned friend the member to argue that to pay only part of the costs of litigating a matter is somehow taking away your rights. It says that the reasonable costs would be paid, and the reasonable costs now have been defined in the tariff. There are many

[ Page 14460 ]

people who sue others in courts on torts and the like. ICBC cases are cases in point. It's rare that they ever get full recovery of their costs. Their costs are recovered based on a tariff.

This has been an exception to that process, and what we have done is actually given an incentive to the owners to at some point be reasonable or continue to go to court, because what happens is that there are landowners who are not reasonable -- there are many who are very reasonable -- and they continue to litigate. Under the old scheme, they would have been entitled to their legal costs whether or not they won or lost the case at the end of the day. I think that was unreasonable. That's why what we've now done is that you will now get the tariff, and that's an appropriate thing to do. We do that with respect to other matters -- all other actions before the courts.

With respect to section 11, this simply codifies the current practice that has been in place, I believe, in British Columbia for decades. It doesn't add or subtract from the current practice. It's for clarity's sake, so that everybody knows what their rights are. They're now printed in black-and-white in this particular section.

G. Plant: One of the questions that arises in the context of the issue the Attorney General has just discussed, the tariff, is whether the playing field will be made unlevel because the government will be in a position where it can essentially spend whatever it wants on appraisers and lawyers, but the landowners will have to take a chance. Their expenditures on that front will be subject to the tariff. If that situation arises -- if the government can go and hire the finest appraisers and lawyers that money can buy, but the landowner is not able to do that because of a tariff that applies to the landowner -- then I think there's a serious risk of inequality.

[1020]

I remind the Attorney General that we are not talking about personal injury litigation. We are talking about a situation where the government, exercising an extraordinary power, takes somebody's land away from them. I understand that the Attorney General is of the view that sometimes landowners who are on the receiving end of that extraordinary power of the state may not act reasonably. That's a risk that the state takes, I think, when it says: "We will violate personal property rights, private property rights, for some greater collective good." It is, I think, right to observe that tariffs exist in other litigious processes. It is also right to observe that traditionally they have not obtained, in Expropriation Act proceedings, for good public policy reasons.

I haven't heard the beginning of a good public policy explanation as to why, on June 25, 1999, it is in the public interest to change a very, very longstanding policy to allow full recovery of reasonable and actual expenses, and to replace that with a tariff of costs. I think there's tremendous potential for unfairness there, particularly if it operates in a way where the government gets the right to spend as much as it wants on appraisers and lawyers without worrying about the tariff, but the landowner does not.

Unless the Attorney wants to comment on that particular issue -- which, frankly, if I were the Attorney General, I would be eager to do. . . . The longer I look at this, the more I'm struck by its unfairness and the more I'm struck that this tariff and these provisions of this bill, introduced in the way they have been and enacted in the way they have been, represent a pretty nice little piece of subterfuge on the part of the government that doesn't care a heck of a lot for private property rights.

But I do want to ask about subsection 11(b) of the act. I asked some people who know way more about expropriation law than I do what subsection 11(b) of the act intends to achieve. I should say, by the way, as with all these things -- just to digress for a moment -- that I want to express my appreciation to the ministry staff for the briefings that they have given me along the way, in understanding these things. It's unfortunate that sometimes when I actually understand things, I begin to see the problems in them.

Here's what someone has said about section 11(b), which is the second change to section 40 of the act. They say this:

"That change does not clarify the law; it changes it. The change does not benefit the landowner; it further reduces the owner's rights to compensation. Section 40 in its present form establishes a minimum amount that an owner must receive for the market value of the land expropriated. In addition to that minimum amount, an owner is entitled to the reduction in the market value to the remaining land and reasonable personal and business losses pursuant to section 40(1). Under the proposed changes set out in section 11(b) of Bill 97, an owner is no longer entitled to the reduction in the market value of remaining lands, in addition to the minimum amount as established under section 40(3). Under the proposed changes, payment of the minimum amount established under section 40(3) would now be sufficient to fully compensate an owner not only for the market value of the land expropriated but also for the reduction in the market value of the remaining land. In other words, two elements of compensation are now being satisfied by a minimum amount."

I recognize that's a technical explanation, but it's a technical subject. No doubt the minister has access to experts who can tell me whether or not the basic thrust of that analysis is correct.

[1025]

Hon. U. Dosanjh: Since this is a very technical matter, I had to get some understanding. The only change that's made to section 40 through this section 11 is that you now are codifying, for the first time, the practice that you get the market value of the land taken. That's the only change; that's the only addition we've made. Previously it said that you got the money for the land taken, but it didn't say market value. But in actual practice you always got market value of the land taken. That is now codified in section 40.

That's why it says: "Subject to section 44, if part of the land of an owner is expropriated, he or she is entitled to compensation for (a) the market value of the owner's estate or interest in the expropriated land. . . ." That is new, and that simply codifies the existing practice. Nothing else changes; The rest of the section remains the same. The minimum amount that the hon. member talks about remains. That's a particular formula for calculating these things, and that remains the same.

G. Plant: In the existing section 40(3), the language reads: "If part of the land is expropriated, the market value of the land expropriated may be established. . . ." Those words "the market value of the land expropriated" are about to be replaced by the language in section 11(b) of the bill -- that is: ". . .the amount of compensation payable in respect of the matters referred to in subsection (1)(a) and (b)(i)." That is to say, it's not the market value of the land expropriated now; it's

[ Page 14461 ]

both the market value of the land expropriated and the reduction in market value of the remaining land. It fuses the two elements of compensation.

I'm sure the Attorney General doesn't need me to make the point, but we're talking here about partial expropriations. So we're talking here about somebody who has half of their front lawn expropriated by a city or a municipal government for the purpose of building a street and paving it, and there are at least two elements -- really three elements -- to the compensation. First of all, there's the value of the land that's been taken away. That's the front half of the front yard that's been removed and taken by the city, and I understand that to be the expropriated land -- the land actually expropriated.

Then we look at what's left -- what the owner of the land has left to him or her -- and we determine whether there's been a reduction in the market value of the remaining land that's left over. Now, that latter bit wasn't formerly included in section 40(3), but it's been added in. Why is it being added in?

Hon. U. Dosanjh: The previous section 40(3) refers only to the market value of the land expropriated and does not talk about the injurious affection. That was the practice. Even in that case, the practice is what's being codified. It's being clarified so that when one looks at the act, one gets a sense of what the courts do and what the Expropriation Compensation Board does. That's been the practice in the past for decades, and we're simply codifying the practice.

G. Plant: I'm going to move on to section 12.

Section 11 approved.

On section 12.

G. Plant: This section clarifies that the B.C. Transportation Financing Authority has no greater liability to compensate an owner for injurious affection than does the Minister of Transportation and Highways. Was there some doubt on the point?

[1030]

Hon. U. Dosanjh: This, I understand, is injurious affection without any taking. In cases where there is no taking, but there is injurious affection, then it specifies what the liability is.

Section 12 approved.

On section 13.

G. Plant: Section 13 -- I can give you an advance notice -- will not pass, at least not willingly. Section 13 is where the real problem here lies. This is what happens, again, when someone has the front half of their property taken by a city -- against their will, I might add. This is not a consensual process. This is where the state or the municipal government or the province comes along and says: "We know that you don't particularly want to lose the front half of the house that you've lived in for the last 50 or 60 years, but we're going to take it from you. We're going to take it from you, because in our view there is a public purpose which is more important to the people of the city or the province as a whole than your private right to enjoy the land which you purchased."

Now, in that situation the state says: "We will compensate you." The first part of the compensation is for the value of the land actually taken. Then the issue arises: "What do we do about the value of the land that remains?" Here an interesting problem sometimes arises. It may be that in a particular case, the state has built a road to an otherwise isolated parcel of land, and the construction of that road is of special benefit to the person that owns the land. It's not really going to be of much benefit to anybody else, so it's not of general benefit; but it is of special benefit to the people who own the land -- the parcel that is subject to the expropriation. In that case, as I understand it, it has been considered to be acceptable practice to offset against some elements of the expropriation claim the increase in the value of the remaining property represented by the special benefit that accrues to the person who is on the receiving end of the expropriation.

There's a distinction between special benefits and general benefits. General benefits would occur, for example, if the city or the province were to expropriate a strip of land for the purpose of creating or paving a road or building a sidewalk. That generally benefits a whole class of persons or perhaps is of general benefit to the community as a whole, the way the construction of basic infrastructure often is.

Now, as I understand it, the traditional view here was that general benefits could not be offset against any aspect of the compensation claim. In fact, on March 22, 1999, the B.C. Court of Appeal unanimously upheld that view. In fact, they went so far as to say that the idea of deducting general benefits from an award of compensation under the Expropriation Act would have the effect of penalizing the owner. The effect of that is to make the owner of the expropriated land pay twice for the general benefit, as I understand it. In the case of a general benefit, we're often talking about something that will be paid by citizens through taxes -- roads, infrastructure work and the like. So the person who is on the receiving end of the expropriation in one sense already has to pay his or her reasonable share as a taxpayer or ratepayer for the costs of the infrastructure. Then he or she finds that there's a double whammy, because the government gets to offset the amount of the general benefit against their compensation claim.

[1035]

I believe that is the purpose of adding this new section to section 44 of the act. The purpose is to overturn the decision of the B.C. Court of Appeal. The purpose is to add a new section to the Expropriation Act, which is intended to impair the compensation rights of landowners which were upheld by the B.C. Court of Appeal. The purpose is to ensure that if part of the land of an owner is expropriated and the expropriation or the construction or the use of the works for which the expropriated land was acquired are of any benefit to that owner, then the value of that benefit must be deducted from the amount of compensation otherwise payable to that owner under section 40(1)(b)(i).

I want the Attorney General to help me understand why the government has embarked upon what I see as this attack on private property rights.

Hon. U. Dosanjh: This particular piece of legislation was proclaimed in 1987, and what the court has said is that the current practice since 1987 or since 1990 -- since the official to my left has been a part of the ministry -- isn't supported by the statute. That's what the court has said.

The practice was to do what this section intends to do. The Expropriation Compensation Board made a ruling to that

[ Page 14462 ]

effect. For the first time, someone appealed that to the court, and the court said that the statute does not support what the board has done. So what we're now doing, actually, is codifying the practice that existed before the Court of Appeal decided that the practice was not supported by the statute.

So this is nothing new. All of the expropriation experts in British Columbia have known that that's been the practice. The fact is that as a matter of principle, I differ with the hon. member, because you don't pay twice. You first get compensated appropriately for the property that's taken from you. Then, if you have benefited from that taking, the benefits that accrue to you should be taken into account. So you don't pay twice; you actually are left whole at the end of the day.

Therefore I think it's important to recognize that this is not about unduly taking private property. This is expropriation for legitimate purposes through which you lose some land, and you get paid for that. The benefits that might accrue to you, if they can be quantified, should then be deducted from what you get. That's a simple principle. It leaves you whole. You don't lose anything at the end of the day. The fact is that you lose the land. You get paid for it. You get benefits, and you have to pay for those.

G. Plant: A person across the street whose land wasn't taken enjoys the same general benefit and doesn't experience the burden of the offset. That's what's unfair. It's that the burden of the offset is not distributed equitably or fairly. The minister talks about the fairness from the perspective of the person whose land was expropriated but ignores the fact that a general benefit is by definition general -- that is, the benefit accrues to others. It may be that the person across the street whose land was not taken to build the road or pave the road or build the sidewalk or bury the sewer gets all of the same general benefit and doesn't have to experience the offset. That's what's unfair. That's why the law in principle, as I understand it, distinguishes between special benefits and general benefits and says that in the case of general benefits, the offset that we're talking about is fair; but in the case of general benefits, it's not.

[1040]

The minister talked about principles of equity and fairness. Well, let me read a sentence from the leading textbook on the law of expropriation in Canada: "As a general principle of equity and fairness it may be stated that an expropriating authority should be entitled to set off only special benefits and then only against the amount of compensation which would otherwise be payable for severance, damage and injurious affection to the remaining land." Well, there's another perspective on equity and fairness. It's a perspective that the Court of Appeal said is the right perspective. The Court of Appeal said that to do otherwise would be to penalize the owners of land.

The minister defends what's being done here by reference to the practice of the Expropriation Compensation Board, which he says is now being clarified or codified with this amendment. Well, I don't think a bad practice is a good defence. The underlying issue is not whether the compensation board used to do this or not; the underlying issue is fairness. The proposal to change the law here -- which I submit is intended to give the Court of Appeal a friendly slap across the face and to say: "Please don't mess with this" -- is wrong in principle.

Again, I have to say that I don't understand where the Attorney General gets his idea of the principle. The circumstances of general benefits are that the landowner whose land was expropriated is being made to experience a set-off in respect of those general benefits by this provision. But the person across the street, whose land was not taken but who will enjoy all of those same benefits, will not experience that set-off. I ask the Attorney General: is that not unfair?

Hon. U. Dosanjh: I think that we will agree to disagree, with respect. I don't believe that these improvements are always uniformly beneficial to everyone and to all the neighbours. Sometimes neighbours who aren't compensated are left worse off than the person who is compensated; sometimes it's the other way around. But the fact is that the kind of equity the hon. member is talking about is impossible. This is a practice that has been in place for over 11 or 12 years in British Columbia and that has been accepted by the expropriating community so far. We're simply quantifying the old practice, and we beg to differ.

G. Plant: I shudder to think about what the Attorney General thinks the expropriating community is. No doubt, it's a bunch of his officials from various government ministries and municipal governments who go around taking people's land away from them. I have consulted with another area of the expropriating community -- the people who represent landholders in expropriation claims -- and they have exactly the opposite perspective. They think that what's being done in this provision is unfair and that there is a distinction between general and special benefits. In fact, I think that the Attorney General gets it wrong -- or gets it too far wrong -- when he talks about the difficulty of allocating the idea of the experience of general benefits. That's not the question. The law recognizes some idea of general benefits and sees a distinction between general benefits and special benefits -- at least, it has up until now. I think, in principle, that there is some basis for that distinction.

Part of the problem here, frankly, is that it is easy for the government to organize and marshal the resources to defend its actions. There probably isn't a group called "Victims of Unfair Expropriation Society in British Columbia." But I'll bet that if there was, they would be people who would argue that when the government takes land, it's an extraordinary use of the government's power. The government has an obligation to compensate fully and fairly. The courts, for hundreds of years, have followed the practice of ensuring that the government's interference with private property rights is kept to an absolute minimum and have upheld the principles of full and fair compensation to the fullest extent possible permitted by the statutory law that applies to them from time to time.

[1045]

The government wants to change those statutory rules here, and they want to do so because they are reacting to a court decision that they don't like. The government is reacting to a court decision in which the courts have said that the practice that the government now seeks to uphold is a penalty; it penalizes owners. The government comes into the Legislature now and says: "We're going to change that, because we really like the idea of penalizing owners. It's really unfortunate that the court changed that or said something bad about that practice. But we're going to get the draftspeople out, add a new provision to the act and make darn sure that we can go on penalizing owners." I think that's unfair. I'm disappointed, frankly, that the Attorney General doesn't recognize the unfairness.

[ Page 14463 ]

Hon. U. Dosanjh: I think the hon. member has just expressed a good treatise, almost, on how the government should be treating landowners. Government has treated landowners with respect; property rights are sacrosanct. There's no question about that. There has to be a due process to take away those rights, and that's the Expropriation Act. All we're doing here is codifying a practice that was thought to be fair, at least for the last 11 or 12 years.

It's interesting that the hon. member actually started the discussion by citing the issue of the tariff as an important issue. So I suppose the hon. member did speak to some lawyers who may think now that they might have to advise their clients based on reasonableness, rather than unlimited amount of fees that they may have been able to get at the end of the day under the old system of providing for fees. I think it's important that that tariff is in.

I understand that the lawyers who practise expropriation law might not be happy with those tariffs, but there had to be some system to bring some level of reasonableness in this area. It was previously inflicted by the practice of unlimited fees that eventually could be reconsidered and reviewed by the Expropriation Compensation Board, but not otherwise. I think this is a process that has been in place, and we're codifying it. We beg to differ. I have the utmost respect for private property; I do own some private property. If somebody took mine in an undue fashion, I would be very unhappy. So I think it's appropriate that we have made all the points and that we agree to disagree.

M. de Jong: I won't pretend to be able to engage in the type of discussion that the Attorney and the member for Richmond-Steveston have, but I did want to bring this perspective. I always react in a negative way whenever the general subject of expropriation is raised, and in particular, the way it is raised in section 13.

I've had property expropriated. Not a lot, and one could argue that it had negligible impacts on the property. But also, in the brief time that I practised law, I acted. . . . I wasn't an expropriation lawyer, but I acted for people -- elderly couples -- who, as the town grew, were confronted by the prospect of losing a part of the home that they had called home for 40 or 50 years. They lost a part of themselves. It is always unreasonable from the point of view of the person who is losing land that they don't want to lose to the state. That is always unreasonable, and it's always a question of balancing those greater needs of society versus the individual rights.

As I was listening to the exchange between the Attorney and my colleague the member for Richmond-Steveston, I thought back on that adage that we all learned in law school, where we begin with the prospect that a person's home is their castle. I thought of all the limitations that have developed -- for sound purposes, I think we would all agree -- around that, around the uses, around the castle. If you're in a rural area, you are confronted by the ALR -- for sound reasons, we think -- but it is certainly a limit on the use of your castle.

[1050]

The zoning requirements that all of us deal with insofar as our homes are concerned and how we can put our land to work for us, the environmental considerations that are relatively recent manifestations, recent limitations that we develop. . . . Expropriation is the ultimate expression of that limitation, where the state comes along in whatever form, be it the provincial or the federal. I'm mindful of the reaction of this provincial government to another expropriation action that is taking place. The point that I want to emphasize in the brief time I take here is that we can talk about general improvements; we can talk about general benefits or specific benefits. The point for that homeowner or that property owner is that they don't want it. They don't want that benefit; it is being foisted upon them. The offensive part of this provision is (a) the whole notion of expropriation is that it will be foisted upon them, and (b) now they're going to pay for it. They're going to pay for something they don't want in the first place. I have great difficulty reconciling that.

The discussion that took place around the tariff is important insofar as it does, I think, represent a limitation on the ability of those individuals to represent themselves in a dispute that is unfair by definition -- the state versus an individual. They are being asked now to pay for something they don't want in the first place. I don't know how the Attorney can justify that. The explanation we've heard is: "We are codifying previous practices." It's bad practice. It's unfair, and it makes no sense to that individual who is confronted by the need to take on the state individually -- take on the state and all of the resources that it can bring to the table.

Maybe I can add this as a final submission. Let's not be under any illusion in this House about how this provision is going to be utilized. I think back to those municipal officials that I occasionally dealt with on these kinds of actions. You know, they have a mandate too. You know what that mandate is? To drive the price down as low as they can -- to compensate to the least possible extent. In my submission, this legislation gives them an unfair tool to do that. This gives them a tool -- codifies a tool; gives them a statutory tool -- to drive that compensation down even lower. They will use it -- as they should, if it is provided to them. They will utilize that tool to the detriment of individual homeowners and property owners who, in general, are ill-equipped to withstand that assault on their property rights. So I do find it offensive. I don't think that the Attorney General has provided a sound rationale for why we should support what is proposed in section 13.

Hon. U. Dosanjh: I don't want to belabour the point. I'll simply say that we will agree to disagree. I recognize that a person's land and home are very dear to any person. I recognize the emotional trauma that one goes through. But if one went backwards using that logic, then one should have no expropriation law.

We recognize the need for an expropriation law, and we also recognize the need for a fair expropriation law. I'm told that the federal government has exactly the same provision in its expropriation legislation. We had this practice in British Columbia. I understand that although Ontario defines its special benefits differently, the actual practice in Ontario is the same as we're codifying here in British Columbia.

I appreciate the passion that the hon. member feels for private property rights. I share that passion. But I also have to recognize that as government, you have to do the responsible thing. I believe this is a fair and responsible process.

[1055]

G. Plant: A last point. We've talked largely about unfairness. There is also, I think, an issue of certainty. It builds on the comments of a moment ago by my colleague the member for

[ Page 14464 ]

Matsqui. The language we're introducing into the Expropriation Act will allow the public officials -- well, it will require them -- to determine whether there is "any benefit." The word "any" in that context is a word that I think generally undermines certainty. It encourages a process of creative thought on the part of all those public officials whose duty it will now be -- it always is -- to minimize compensation claims. It will encourage them to imagine, in the fullest possible way, the widest possible range of potential benefits. I think that's unfortunate. I think that will expose claimants and compensation hearings in the fullness of time to a collection of interesting, novel, unusual and perhaps, in some cases, extraordinary arguments. In each case the Expropriation Compensation Board or the court will be drawn back to the language in the act and will see the words "any benefit" and will realize that there is no statutory basis upon which that idea can be constrained. So not only is it wrong and unfair for the government to add this additional penalty to landowners by introducing this section. Unfortunately, I think it is uncertain, to use the language that the government chooses to use here. I just think that we're all going to live to regret this decision by the government.

Hon. U. Dosanjh: Not to prolong the debate, I just want to say that the word "any" is mentioned so that it includes special and general benefits. That's the context.

[1100]

Section 13 of Bill 97 approved on the following division:

YEAS -- 35
EvansZirnheltMcGregor
KwanG. WilsonHammell
BooneStreifelPullinger
LaliOrchertonStevenson
CalendinoWalshRandall
GillespieRobertsonConroy
PriddyPetterG. Clark
DosanjhMacPhailLovick
RamseyFarnworthWaddell
SmallwoodSawickiBowbrick
KasperDoyleGiesbrecht
GoodacreJanssen
 
NAYS -- 29
C. ClarkWhittredFarrell-Collins
de JongPlantAbbott
L. ReidCoellChong
SandersJarvisAnderson
NettletonPennerWeisgerber
J. WilsonJ. ReidDalton
Barisoffvan DongenSymons
ThorpeKruegerHansen
StephensColemanHawkins
HoggNebbeling
Sections 14 to 19 inclusive approved.

[1105]

On section 20.

G. Abbott: I just have a few questions on section 20, hopefully, to clarify the intentions of the government with respect to section 20 and also to get a clearer understanding of what the impact of section 20 -- as proposed for amendment -- would be.

We've done a couple of things to try to sort that out. Obviously one thing we want to do is compare it with the existing section, which is pretty clear, on what amount is going to be retained in the consolidated revenue fund and what amount is going to go on to FRBC.

The new section 11(6) -- created by section 20 of Bill 97 -- includes some new language, which I think makes it rather less clear what the amount that is going to be retained in the consolidated revenue fund is going to be. I think the critical phrase in section 20 is "an amount prescribed by Treasury Board." We don't find that language in the existing legislation. There it clearly states: "For the purposes of subsection (4), the amount to be paid out of the consolidated revenue fund for each fiscal year of the government is to be (a) reduced by $50 million, if the sum of the quarterly amounts calculated under subsection (4) for that fiscal year is $50 million or more, or (b) reduced to zero if the sum of those [quarterly] amounts is less than $50 million." So there's a very clear division in terms of what's going to be retained in the consolidated revenue fund in that instance. In the new legislation it's rather less clear, because, as I've noted, we have the language "reduced by an amount prescribed by Treasury Board," not exceeding $50 million in one case and reduced to zero in the other.

The minister won't be surprised to hear that in preparation for this, the opposition phoned around to see what other people were thinking the impact of this would be. I think there is an understanding that the intent of this is to see more dollars in the pockets of FRBC and rather less retained by the consolidated revenue fund. That seems to be the understanding, but my first question to the minister is to explain if this is in fact the case.

Hon. D. Zirnhelt: Let me say, in as simple language as I can, what the intent is and what the effect of this amendment is. Given that we made a structural stumpage reduction in the neighbourhood of $200 million -- when prices of lumber are low and therefore stumpage is low -- this reduces the revenue flow to Forest Renewal B.C. Maintaining the core program is difficult if they don't have sufficient funds in the rainy-day fund in Forest Renewal. It was estimated, given projections that are still the official projections of revenue -- although recent prices may change that. . . . Given a pessimistic scenario for revenues for Forest Renewal, the Treasury Board and the government of British Columbia wanted to be able to flow additional funds to Forest Renewal than the formula would normally cause to flow to Forest Renewal. This holdback of $50 million would be forgone in amounts determined by Treasury Board -- which would be the subject of discussions between Treasury Board and Forest Renewal, as to what they need to run the minimal program, given the conditions at the time.

Obviously this is now less important, given that if price is sustained in the forest industry, Forest Renewal will have more revenue than they predicted. So it is an ability now to discuss the needs of Forest Renewal to run their basic program.

[1110]

G. Abbott: That goes some distance to helping me understand that. Let me just rephrase what the minister said to see if

[ Page 14465 ]

I've got this right. When income from superstumpage is still at high levels -- say, $400 million -- the new provision really won't affect the amount going to FRBC. The top-end figure still remains $50 million. What the new language does is allow the government to take some portion of the $50 million -- as low as zero in some instances. But unlike the old legislation, where it's either zero or $50 million, this new legislation -- subject to discussions between Treasury Board and FRBC or the ministry -- would allow them to set the figure at somewhere between zero and $50 million, whereas now it is either zero or $50 million. Is that correct?

Hon. D. Zirnhelt: Yeah, the government automatically takes $50 million now. What this does is allow the government to take somewhat less -- something between $50 million and zero -- depending on Forest Renewal's needs at the time, which are probably constantly changing. When we drafted this, it looked like they would be in need of it. That need would be determined by Treasury Board, having consulted with Forest Renewal. So yes, it allows Forest Renewal to retain or have more revenue than it ordinarily would have had under the previous legislation.

G. Abbott: Could the minister advise whether there is a definitive formula that is going to be used -- following, presumably, the adoption of the new language? Is there a definite formula that could be used? Let's say, just for hypothetical purposes, that the superstumpage was $100 million in this or any other fiscal year. I'm using that just as an example. Would we have a clear idea what the holdback would be in that case? Or is it all a matter of the discussions occurring between FRBC, the Ministry of Forests and Treasury Board, which in the end will produce an amount prescribed by Treasury Board, as opposed to having a clear amount that would be determined by formula?

Hon. D. Zirnhelt: There is no definitive formula, and I don't think we could do one. It depends on the fiscal plan of Forest Renewal. When this was constructed, the fiscal plan of Forest Renewal showed that there might be a shortfall in meeting their cash flow needs because of the holdback provisions. So the government was prepared to keep them whole, in the sense of being able to meet their fiscal needs by way of this provision. The exact amount would be a matter for discussion between Forest Renewal and Treasury Board.

G. Abbott: The minister has made the intentions of the government, at least for the foreseeable term, clear here. The aim is to provide more funds to FRBC to deal with transition issues and that sort of thing. If the priorities of the government were to change and the government decided that they had a greater need for that revenue than Forest Renewal, could the new language in section 20 be used to keep revenues at a higher level -- i.e., $50 million -- even though FRBC's revenues were coming down? In short, if the government had different priorities, could the amount that is in fact held back from FRBC be greater than it has been in the past, under the existing language?

Hon. D. Zirnhelt: No, this works to FRBC's advantage and won't work to their disadvantage.

G. Abbott: That concludes my questions with respect to section 20.

Sections 20 and 21 approved.

On section 22.

[1115]

R. Coleman: I just have some questions for the minister relative to this section. This deals with something that's gone on from 1955 right through to 1986, with regard to grants from the province to put housing projects together. I have no problem with the section -- with what it is conceptually trying to accomplish. I do have some concerns about communication around the section. Effectively, this section affects about 255 different societies around the province, which have about 377 different titles. The estimated value of the properties is about $600 million. Given some of the experiences we've had with things like the Glacier View Lodge situation and that, I'm just wondering if the minister could tell me what communication you're putting in place to ensure that these societies understand what's happening here.

In the court decision on the Calling Foundation, it was found that if there was a change of use in the property, the society in that case could simply pay out the original one-third grant from the province and use the land for whatever it wants -- which would give it a windfall. The concern I have is that as we make these changes -- so there's no blowback and misunderstanding from the organizations that are affected -- what's the communications plan to advise them?

Hon. U. Dosanjh: I'm told that the ministry responsible, the Ministry of Employment and Investment, has made plans through B.C. Housing to speak to all the societies in the fall, when this section would be proclaimed. Letters would go out to all the designated societies, as they would be designated by cabinet at that time. So there is a plan in place to make sure that people's concerns are dealt with and answers are provided.

R. Coleman: Having heard that, I think that satisfies me. I should say that this is, in my opinion, the right thing to be doing. Obviously we shouldn't be using government money to build housing over a 20- or 30-year period and have the asset appreciate in value and then lose our investment. It's a loophole that probably needs to be closed if we're going to be able to, in the long term, manage our housing stock for redevelopment for future seniors' social housing and care facilities. I think it's important that we've done this; but, again, I think it's important that the organizations affected are aware of that. If B.C. Housing is going to do that, then that's fine.

Sections 22 and 23 approved.

On section 24.

G. Plant: This will be a question that I don't think the minister will need staff for.

Sections 24 to 30 inclusive make changes to the Human Rights Code. As everybody knows, the Human Rights Code provides substantive rights to British Columbians to ensure that, among other things, they are free from discrimination. The code also provides a process for adjudicating complaints where rights have been violated. The process under which the commission and the tribunal deal with those complaints, like all quasi-litigious processes, could use a little updating from

[ Page 14466 ]

time to time, particularly in an era where we are recognizing that there needs to be enhanced focus on alternative means of dispute resolution.

[1120]

I understand that the Human Rights Commission and the Human Rights Tribunal are working on some projects in that regard. But now we have some amendments to the code before us in Bill 97. Having read these amendments, my understanding is that they deal entirely with procedural matters and do not affect any of the substantive rights that British Columbians enjoy under the code. They neither expand nor contract the range of protection that exists in the code. Time will tell whether the procedural changes will help the tribunal operate more efficiently. The goal, from my perspective, would be to encourage and assist them to operate efficiently -- without, of course, compromising fairness. But may I have the Attorney General's confirmation that my understanding of these revisions is correct -- that they are procedural and not substantive in nature?

Hon. U. Dosanjh: That's absolutely correct.

Sections 24 and 25 approved.

On section 26.

Hon. U. Dosanjh: I move the amendment standing in my name on the order paper.

[SECTION 26, by deleting the proposed section 26 and substituting the following:

26 Section 34(3) is amended by striking out "designated to hear a complaint has, for the purpose of the hearing," and substituting "has, for the purposes of this Act,".]

G. Plant: What is the purpose of this amendment?

Hon. U. Dosanjh: I'm told that it's correcting an error in reference.

Amendment approved.

Section 26 as amended approved.

On section 27.

Hon. U. Dosanjh: I move the amendment standing in my name on the order paper.

[SECTION 27(c), by deleting "subsections (3) and (5)" and substituting "subsections (3) to (5)".]

Amendment approved.

Section 27 as amended approved.

Sections 28 to 33 inclusive approved.

On section 34.

S. Hawkins: I have some questions on section 34. It was only a couple of months ago that we saw the same amendment arise in Bill 53, which was the budget implementation bill that passed. This House -- reluctantly, I remember -- approved increasing the cap on the industrial incentive fund from $450 million to $500 million, which was a $50 million increase. Now, less than two months later, we see it coming up in this bill, and now the government wants $100 million more. Would the minister explain where this $100 million is going to be spent?

Hon. U. Dosanjh: By increasing this amount by. . . .

Interjection.

Hon. U. Dosanjh: Yes, $100 million -- a significant difference.

Interjections.

Hon. U. Dosanjh: No, we do care.

The government can make loans and investments to strategic economic development projects that require government financial participation to proceed, and as the hon. member knows, we are making strategic investments in different areas. It's important for us to kick-start the economy. The economy is beginning to turn around, and this $100 million may assist us further.

S. Hawkins: Unfortunately, what we've seen in the last few years is the government consistently increasing this amount, and if the economy was turning around, you'd think that companies. . . . And if there was an atmosphere, an environment, for companies to come and invest in B.C., you would see the private sector making these kinds of investments, not the government having to borrow another $100 million, put it in this fund and then dole it out where it sees fit. I don't think it is a good thing to do -- to keep borrowing money and putting it into investments to try and prop up the economy.

I think the government -- and we've made this point before -- has lots of options, and that's to make the playing field even for everybody. Tax cuts that really work, reducing regulation and red tape, balancing labour laws -- perhaps that's the kind of thing the government should be looking at to make the environment favourable for private investment, rather than to keep borrowing it and putting it into investments that the government wants to make. I don't think the government should be in the business of private business.

[1125]

Can the minister confirm that the $20 million that the Premier announced three days ago is coming out of this fund? He made that announcement for a $20 million loan to Vancouver Film Studios. I believe it was on Wednesday. Can he confirm that it's coming out of this account?

Hon. U. Dosanjh: Yes, I'm told that it came out of that fund. But let me just respond, at the risk of prolonging the debate. We have perhaps the best labour legislation in the North American continent. We have, over the last many years, not lost as many days due to work stoppages, because we have the best labour legislation in North America. Okay? So I think it's important for people to recognize that. Rather than ranting and raving based on ideology, one should look at the reality. The reality is that the economy is beginning to turn around. The reality is that we've been trying to kick-start that economy. This morning there was good news on CBC about the forest industry.

[ Page 14467 ]

Now, the hon. members want to shut their eyes and talk rhetoric all the time; that's fine. But let's talk about the reality. The reality is that government does need to make investments in very strategic sectors, very strategically. We're doing that, and we're not going to apologize for that.

S. Hawkins: The reality is that this government has poisoned the investment climate in this province. The reality is that we can't find private investment to come here and invest in this province. In fact, the reality is that the chair of Vancouver Film Studios, David McLean, is quoted as saying that private investment isn't coming in to put the $20 million into the film studios because, he says, they view B.C.'s flat economy and unpopular government with wary eyes. That's the reality.

So instead of private investment coming in to give $20 million to this studio to invest in something that is a promising economy in this province, we have the government having to borrow $100 million to dole out for photo ops to try and prop up the Premier's stature. That's what we're seeing. And you know what? That is the wrong thing to do. We've got $80 million that the government has already doled out. Without even getting approval at the Legislature, they've already doled out $20 million of this fund. And they've got another $80 million for photo ops -- very expensive, borrowed-money photo ops -- for this Premier. I think that is a flagrant abuse of taxpayer money. I really do believe that. So I will not support this section. The opposition won't support this section.

If the economy was better, we wouldn't have to do this. Companies wouldn't be coming hat in hand to government looking for millions and millions of dollars. We'd see the private. . . .

Interjection.

S. Hawkins: The Minister of Aboriginal Affairs and the slow ferries program, which used to be the fast ferries, says: "Nonsense." He used to be on this side of the House, saying exactly what this member's saying. He used to say that we should have a responsible government that doesn't borrow, that we should balance the budget and that we shouldn't add to the debt of this province. Now he's saying that it's okay to borrow $100 million so that the Premier can have $20 million, $50 million, $100 million photo ops. That is wrong. We will not support this section.

Hon. U. Dosanjh: I don't want to prolong the debate, but it was Ron MacDonald on CBC this morning who said that the provincial government deserves credit for the turnaround in the forest industry. The Minister for Small Business, Tourism and Culture and the whole government can take credit for the $1 billion worth of film industry that's in British Columbia.

Section 34 approved on division.

Sections 35 to 55 inclusive approved.

On section 56.

[1130]

G. Plant: These are some changes to the Police Act in particular to, I think, take a burden off existing sitting Provincial Court judges to sit and serve as adjudicators in public hearings and to place that burden instead on retired Provincial Court judges. I assume this will assist, among other things, in allowing the Provincial Court to deal with the workload that it has and not to have judges from that court from time to time be distracted by having to serve as the presiding officials in public hearings under the Police Act. Does the minister have the same expectation?

Hon. U. Dosanjh: Correct.

Sections 56 to 60 inclusive approved.

On section 61.

C. Hansen: If you go back two years ago, we had a bill introduced -- Bill 37, in 1997. It was titled the Tobacco Damages Recovery Act, and it was really the genesis of this act that we now know today as the Tobacco Damages and Health Care Costs Recovery Act -- which is being amended by this section.

It was actually interesting. . . . I went back and took the amendment legislation that was brought in a year ago, which amended this particular 1997 bill. Then, again, today we have these four sections in this bill that are amending that legislation. Just out of interest, I went back and started looking at how much of the original bill is still intact less than two years later. The title isn't even intact anymore. Of the definitions section, only six of the original 13 definitions are still standing. We have now totally deleted out of this original act sections 2 through 15. Section 15, interestingly enough, still looks almost like what it looked like less than two years ago, but even that's been amended. There's actually only one section of the act from two years ago that has not been amended in a substantial way, and that is section 20. You know what section 20 in the original act says? It says: "This Act comes into force by regulation of the Lieutenant Governor in Council." That is the only section of this act, which is less than two years old, that is still intact.

This act has now been totally rewritten on two occasions, and let's look at why. It's because, basically, this government wants to take the tobacco industry to court. We supported that initiative in the first place, and we're certainly not going to oppose these particular amendments today. But I'd like to ask the minister: given that every year this chamber is presented with a wholesale rewrite of this bill in order to get around the constitutional issues that this government is faced with, can the minister can tell us whether or not we're going to be facing yet more amendments to this legislation next year in order to facilitate the government's court case?

Hon. U. Dosanjh: I don't want to engage in the kind of debate the hon. member at the other end is beginning. I just want to say that at the time when this was legislated, it wasn't clear which path the government might pursue. The government is not pursuing the path of statutory subrogation. These sections deal with statutory subrogation, and therefore they are deleted. All of the other amendments are consequential amendments. The government is suing directly, and that suit is before the courts.

C. Hansen: A week ago I had to find out what judicial subrogation was. As I understand it -- not being a lawyer, but for anyone who's trying to follow this in Hansard -- it's the ability of government to act on behalf of individuals. Instead,

[ Page 14468 ]

there is a blanket case that's being brought by government. But as I understand it, in section 19, which is being amended in this miscellaneous statutes act before us, the motivation behind this is because of the potential for this particular act being challenged on constitutional grounds. I'm wondering if the Attorney General can confirm that.

[1135]

Hon. U. Dosanjh: It's my contention that all of these amendments are consequential to the central issue that I've talked about. Government has no intention of proclaiming this portion of the legislation. Therefore government felt it was appropriate to repeal. We've been doing that as part of red tape and streamlining and repealing statutes that have been sitting on the books, unused, for decades. I think it's important that we did that. I think it's also important that we make sure that the government's action is appropriate and not open to attack based on sections that the government has no intention to proclaim.

C. Hansen: I think the Attorney General has an interesting concept of cutting red tape, if he talks about amending a piece of legislation to facilitate the government's court case against a private sector industry. Then, when they find out that they may be in jeopardy of not winning that court case, they come back and change the rules in the session. That's what this is all about today. I'd like to ask the Attorney General where we're at in terms of the lawsuit. What stage are we at in terms of the lawsuit that the government is launching against the tobacco industry?

Hon. U. Dosanjh: I haven't had a recent briefing from the team of lawyers that are working on this. I wouldn't be able to advise the hon. member. I would be happy to take a briefing from the lawyers and advise the hon. member. These are not estimates; this is about the legislation itself. I'd be happy to provide that information to the hon. member anytime.

C. Hansen: The other thing that I think is germane to this amendment that's before us is what it is costing taxpayers for the lawsuit. I would like the Attorney General to undertake to advise us on what the costs of the legal fees are to date in the preparation of this particular court case.

Hon. U. Dosanjh: Again, this is an issue that has come up in this Legislature several times. I have taken the position -- and taken it very strongly -- that there are issues around solicitor-client privilege that are very, very important. I'd be happy to take a look at that issue, as well, and speak to the hon. member.

C. Hansen: I would certainly appreciate it if the minister could provide us with a memo or a letter with that information in it.

Sections 61 to 77 inclusive approved.

On section 78.

B. Barisoff: Section 78 deals with retroactivity in appealing a tax assessment notice. I would like to ask the minister why, in retroactivity. . . . I know that in Bill 52 we took out the retroactivity to deal with West Kootenay Power. I'm wondering why this section is actually in here at this stage of the game and what effect it has on the packinghouses that are affected by this.

Hon. U. Dosanjh: I understand that in the absence of this legislation, there is about $800,000 in municipal taxes that will have to be rebated by small communities. That's the issue that's before us.

B. Barisoff: If the minister says that $800,000 would have to be rebated, I guess my concern is that there have got to be people who are appealing that. The people that are appealing the $800,000 are from the farming communities, so what's ultimately taking place here is that farmers in cooperatives -- and most of these are probably in cooperatives -- are actually being affected. That's $800,000 more that they would have to pay. I wonder why, retroactively, we're looking at something like this. If retroactively it's wrong, why are we changing it? If it's wrong, why doesn't the minister. . . ?

[1140]

An Hon. Member: What is your wish?

B. Barisoff: Actually, my wish would be that government look at this, and if they've made a mistake, I don't think either the municipalities or the farming community should be put on the hook. What I'm saying is that the retroactivity part of this entire bill is wrong. What the minister is saying is that he wants to put the communities on the hook for a mistake that was made by the government. What he's trying to do is play off one side against the other. It's totally unfair.

What I'm asking the minister is: why are they doing something retroactively? Why are the farmers and the municipalities being penalized? If you've made a mistake, then it should be corrected, and the government should bear the costs.

Hon. U. Dosanjh: Here are the communities that are going to lose money, and I'm going to give round figures: Kelowna, $468,000; Penticton, $38,000; Summerland, $71,000; Lake Country, $88,000; Keremeos, $79,000; Oliver, $97,000; and Osoyoos, $14,000. I would really like to hear what the hon. member's position is. Do you want to move to amend this? That's fine. I don't have a problem with that.

B. Barisoff: My concern is: who has to actually pay this money? What the minister should do is ask the Minister of Agriculture: who has to bear these costs? What you're saying is that the communities will have to pick up this tab. Who is it being paid by? It's being paid by the farming community where these taxes are being assessed. If the government has made a mistake, then somebody better correct it. It shouldn't be the communities and the farmers that have to pick up the tab.

Interjection.

B. Barisoff: The member for Powell River-Sunshine Coast asks: "Who pays us?" Well, somebody has made a mistake here. What you're saying is that the farmers should bear the cost of this.

Interjections.

[ Page 14469 ]

B. Barisoff: Yes, that's exactly what you're saying. Now, is the minister saying that the farmers should bear this cost?

Hon. U. Dosanjh: These taxes have been paid. The issue is a rebate from the communities to these individuals or corporations. What we're saying is that this is something that is assisting the different communities that I have indicated. The hon. member, in the usual style of politics, isn't taking a position. He wants to have his cake and eat it too. I would like to know what his position is.

Section 78 approved on division.

Sections 79 to 81 inclusive approved.

Title approved.

Hon. U. Dosanjh: I move the committee rise and report the bill complete with amendments.

Motion approved.

The House resumed; the Speaker in the chair.

Bill 97, Miscellaneous Statutes Amendment Act (No. 3), 1999, reported complete with amendments.

The Speaker: When shall the bill be considered as reported?

Hon. U. Dosanjh: By leave now.

Leave granted.

Bill 97, Miscellaneous Statutes Amendment Act (No. 3), 1999, read a third time and passed.

[1145]

Hon. D. Streifel: I call committee on Bill 89.

PENSION STATUTES AMENDMENT ACT, 1999

The House in Committee of the Whole (Section B) on Bill 89; W. Hartley in the chair.

On section 1.

I. Chong: I want to, first of all, begin my comments by thanking the superannuation commissioner, Mr. Cook, who isn't here in the chambers. Assisting the minister, he has been very helpful. Nonetheless, even with all of the assistance he has provided, there have been a number of questions raised by people who have had the opportunity to review this piece of legislation that was so recently introduced to these chambers.

In section 1, we are dealing with the Hydro and Power Authority Act. The crux of all the comments we have received in the last week deals with the joint management agreement in section 1, which adds section 37.1 of the Hydro and Power Authority Act. I'm not going to refer to the definitions in paragraph 1, but in paragraph 2 there is concern about the Hydro authority entering "into a joint management agreement with the trade unions that represent its employees for the joint trusteeship of all or part of the pension plan and pension fund, or for any other matter relating to the pension plan or pension fund on which agreement is reached." It makes specific reference to the trade unions and not to any other groups. I'm wondering if the minister can advise why it was so specific there and why there was exclusion of other groups.

Hon. J. MacPhail: In order to have participation amongst representatives or to establish representatives of those affected, one has to have an organizational structure in which to choose those representatives. The employer is organized to choose representatives, as trade unions are organized to choose representatives. Beyond that, the groups are not organized. So that's why those two are very specifically identified as organizations by which members can make their representations known in a democratic way.

[1150]

However, if you look below that, at 37.1(3), it says: "The authority and the trade unions" -- which are organized groups -- "must establish appropriate mechanisms whereby the views and interests of the authority's non-unionized employees and retirees are fairly represented in the negotiation of the agreement."

To that effect, there are public letters that have been circulated. One is from the CEO of B.C. Hydro, saying how those groups will be represented. First, representatives of the management and professional employees, which is an unorganized group, and the retired employees will be invited to participate fully in the discussions of the joint management agreement. Second, should a decision to enter a joint management agreement be reached, the authority -- which is Hydro -- will ensure that an appropriate process is established for appointing to the board established by the joint management agreement a management and professional employee who is a plan member and, in conjunction with the IBEW and the OPEIU -- the two unions -- a retired employee who is a plan member. This letter is to the superannuation commissioner, Mr. John Cook: "Third, you have indicated that, as trustee and facilitator for the process, you will be engaging Hewitt and Associates as your adviser." So that's the letter.

Then there's a letter from the two unions, saying exactly the same thing: "First, that representatives of the management and professional employees and the retired employees will be invited to fully participate in. . .the joint management agreement."

Just to conclude, I would be interested to know how the members would suggest otherwise -- how a group of employees or a group of single entities would participate, except through a democratic process.

I. Chong: I appreciate the minister wishing to have input from this side as to how this would proceed. I guess, first of all, it would require identification of the numbers that we're talking about in terms of the management and professionals, the excluded members and the retirees. I believe I've been given the number of 1,200 management and professional employees.

Interjection.

I. Chong: When the minister says it's irrelevant, I guess I would have to disagree. The fact of the matter is that, yes, the

[ Page 14470 ]

trade unions are organized -- and that's great. They have representation, and they may number around 4,500 or 5,000. But without knowing the other proportion of the total pie, if you will -- of the pension plan -- it's difficult to proceed with what the minister states as allowing the managers and professionals and retirees to fully participate. How will you determine that full participation, if you're not able to identify how many of those people there are? If, for example, there were 5,000 union employees and up to 3,000 in the non-union sector who are participants of this pension plan, then how will you ensure that that full participation will permit that proportional representation in joint management? In other words, would you have five representatives from the union and three from the retirees group? I'm not sure how that would best be handled, I have to admit. But there has to be something that includes them, because at this point it seems exclusive.

Also, I don't think it would be such a difficult procedure for the plan administrators to send out notification to all those who are members of the excluded groups to be permitted to provide input. With organized groups such as trade unions, certainly there's that mechanism in place. A newsletter goes out, and everyone who is a union member receives a newsletter once a month or once every quarter. But there is no mechanism, as the minister has acknowledged, to perhaps allow those others to actually know what's going on with this plan. So my concern, as raised by members of this plan, is: how will they know what's happening? It's only a very few who are even aware that this change is being put in place, and they are contacting MLAs on this side of the House. . .

An Hon. Member: And their side.

[1155]

I. Chong: . . .and, I'm hoping, on the minister's side of the House. It's rather sporadic, I would say, at this time of the year because it is summer, so we don't know the full extent of what the concerns are. If this is going to be proceeded with, which I imagine it will be, I at least would like to have some comfort. And I know the plan members would like to at least have some comfort in knowing that full participation, which the minister is intending to have happen -- and I'm sure they're good intentions -- will in fact proceed. But without identification of that excluded group, there isn't any. I'll allow the minister to answer.

Hon. J. MacPhail: I hope I can answer this in a way that calms the fears that have been heightened amongst people, particularly by the opposition. Right now retirees and management and professional employees have representation on a consultative committee. They have been fully participating in all of this movement forward. I will not prejudge what the representation will be in the future, but there will be agreement amongst everybody about what that representation should be. There will be agreement by the management and professional employees, the trade unions and the retirees. The retirees will now have more direct access, perhaps, than they do under the current plan. The fears being heightened by the opposition -- that they're going to have less input -- are simply wrong. I think that for the opposition to put these fears into retirees is absolute. . . .

Interjections.

Hon. J. MacPhail: No, you must listen to me. It's absolutely inappropriate.

Interjections.

Hon. J. MacPhail: No, I will not. It has been a deliberate move, through advertisements and advertising on the radio, on the part. . . .

Interjections.

Hon. J. MacPhail: Yes, advertising on the radio -- to heighten the fears of retirees. I will tell you that the irresponsibility on the part of the Liberal opposition has been unbelievable. Pursuing this line of questioning after what I have just read out to you and pretending that it's somehow a matter of numbers, or whatever, is irresponsible.

Let me tell you another factor. I have just stood up here and given you a direct -- through you, hon. Chair -- commitment to the representation of groups, even though they're unorganized. I asked the member what her advice would be. Instead of just raising fears, what would her advice be on how to get that representation? The employers and the unions have made their commitment to representation, and it will be a representation that reflects the current practice and improves on the current practice.

Lastly, there is no. . . . Somehow the Liberal opposition has raised the fears of retirees by suggesting that some rights are being taken away. In fact, the rights that the retirees and the management and professional employees have now are, by agreement, amongst the parties, and those are going to improve. I have answered this question through reading out the letters. If there is a continuation of a line of questioning from this, then it will be on their part that the fears are being heightened.

With that, hon. Speaker, noting the hour, I move that the committee rise, report progress and ask leave to sit again.

Motion approved.

The House resumed; the Speaker in the chair.

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

Hon. J. MacPhail moved adjournment of the House.

Motion approved.

The House adjourned at 12 p.m.


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