Hansard -- Volume 3, Number 10 -- Thursday, February 21, 2002

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

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY



CONTENTS

	Routine Proceedings
		Page

Budget Debate (continued)		1243
	Hon. K. Whittred	1243
	Hon. G. Plant	1245
	J. Wilson	1248
	Hon. S. Santori	1250
	Hon. T. Nebbeling	1253
	Hon. C. Hansen	1254

Hon. K. Whittred: Continuing from my remarks of late yesterday afternoon, before the close of day yesterday I was discussing the values that Canadians and British Columbians hold around our health care system and putting these in some context of where we are going with health care in British Columbia.

Quoting from the recent report done by the Legislative Assembly committee on renewing health care in British Columbia that was recently announced, it states the belief that B.C. must work towards maintaining its viable, high-quality and effective health care system and that such a system is an essential social good and, indeed, a defining characteristic of Canadian society. What differed, however, was the multitude of methods and varied philosophies presented on the roles of government health care providers, private industry, the general public and individuals in keeping that system healthy and sustainable well into the future.

What we are seeing from statements such as that and from statements that are appearing in other reports across Canada is a belief that while we value very much the health care system that we have in Canada, we do realize that there must be changes, that we must address certain issues in order to fund these programs in a sustainable manner.

If we look back a little bit, we will note that in the year 1991-92 the Health budget was $5.4 billion. That was ten years ago. The other day, when the Finance minister presented his budget…. We now have a health care expenditure of $10.2 billion. That is almost twice the amount of money in a period of ten years.

What we see is a health care budget that is increasing at a rate that is beyond the ability of the citizens to support. What we see is a health care budget that is unsustainable in its present form. The increase is so great that we see the health care budget increasingly using up more than its sustainable portion of the provincial budget. I think almost every thinking British Columbian realizes that that has to change. If the health care budget were to continue to increase the way that it is, we would soon have a province where other necessary services would simply be at risk — for example, education, transportation infrastructure, safety and security, the delivery of justice. All of those programs that citizens also rely on government to deliver would be threatened because of the increasing cost of a health system whose cost has become unsustainable.

Why has this happened? Why, in the last 40 years, have we seen the change from the beginnings of this system that Canadians value so much to a system that today seems to be an endless rise in costs? One answer is technology. If we think back to 40 years ago, we didn't have much of the expensive diagnostic equipment that we have today. We didn't have CAT scans; we didn't have MRIs; we didn't have all of these sorts of diagnostic tests that have improved our system but have also increased the cost. If we look at many of the costly procedures in health care today — things like hip replacements, knee replacements, open heart surgery, for example — those were only dreams 40 years ago. Nobody was receiving these kinds of medical procedures. Technology has allowed us to go well beyond what was envisioned when the Canada Health Act was first introduced.

Another change, and it really arises out of the first factor that I mentioned, is a change in demographics. We are living longer. The fantastic devices and medications that have been developed in the last 40 years enable people to live much, much longer than they did 40 years ago. I am told that 40 years ago the average payout of Canada pension, for example, was seven years. Today, I believe, that has doubled to something like 14 years. That is a slightly different example, but it gives you a sense that we have to pay for the delivery of health care to a much, much greater population and a population where the needs are greater. As people age, so does their need for health care. That is certainly a very, very significant difference from when we first introduced the Canada Health Act in this country.

I can give you an example from my own community. Between the years 1999 and 2000 on the North Shore, where I am a member, there were 382 more seniors in the population; 382 is quite a big number for one area of the province. Of that group, 290 were 80 years or older. You might be interested to know, Mr. Speaker, that the population over 80 is the fastest-growing segment of our population. It is growing at a rate of more than 200 percent per year. One of the interesting experiences I have had is to journey around the province visiting many of the residential care homes where seniors who require residential care live. The average age in these homes is nearly 90; it's always between 85 and 90. That is quite an amazing statistic to actually get your head around.

A third reason that I think health costs are expanding at these very, very unsustainable rates, Mr. Speaker, is expectations. There's another little bit of technology, you know, that's been introduced in the last 40 years. One has been television. It's pretty amazing to think that 40 years ago, when the Canada Health Act was introduced, television was not widely spread across all parts of Canada. That increase in communica-

tion, of course, has increased the ability of populations to have more knowledge about the health care system, to have more information and to be subjected to more marketing.

Then, of course, in even more recent times, we have the Internet. Any one of us can go on the Internet today, and we can find out very quickly about almost any illness. We can find out about almost any medication. In fact, we have become an extremely well informed society about our health and our health needs. Along with that, of course, goes the expectation that we are going to have service very close at hand.

Those are simply some of the challenges that we have in terms of trying to make our health care system more manageable. I think they illustrate that there is a great deal of unsustainability about it, and I think there is also evidence that the public is willing to look at ways in which we can reform the health care system to make it more manageable.

I would like to focus, just for a few minutes, on a couple of things that frequently are talked about and which can have extremely positive results around the delivery of health care. One of these we often hear the talk about is primary care reform. People wonder: "What the dickens is primary care reform?" Well, primary care is simply the first time we go into the medical system.

For most of us, it's making an appointment at our doctor's office. What typically happens is that we go to our doctor; we have a complaint of some sort. The doctor is in private practice. He has several alternatives that he can do, usually, to look after you. He usually can write a prescription at the end of the visit. He can refer you for some tests. He can refer you to a specialist. Those are the things that normally happen. All of those things are really, in today's age, not very efficient. I think all of us experience the frustration sometimes of going to our doctors and being referred for a test. You have to wait a week for the test, then you have to wait a week for something else, and these things seem to go on forever.

Primary care reform would be changing that immediate access into the system. Around the province there are a number of pilot projects where we have physicians, nurses, dietitians, nutritionists, physiotherapists and various other health care professionals working together in one spot where patients can go and receive more immediate care, often in a much more efficient and expedient manner.

This also has incredible possibilities for our senior population. One of the principal outcomes in senior care often is overmedication. Many things happen with seniors. They tend to get medicines, and some of them do not take their medications properly, or their medications are not monitored properly.

I believe that a significant portion of seniors' entry into hospital is in fact because of inappropriate drug use. It's not uncommon to have an elderly person taken into an emergency ward because they have either taken too much medication, taken the wrong pill or some other reason. If we could devise a system whereby that didn't happen, we could achieve significant efficiencies in the system while at the same time significantly improving the well-being of many elderly people.

There is a very good example of a program in British Columbia. It's called SMILE, for short. That actually stands for Seniors Medication Information Line. It is a program that was developed and piloted in one of our communities. It involved pharmacists working with volunteers who were younger seniors, so it was sort of seniors helping seniors. They were trained in monitoring medications. These volunteers would go and call on seniors, train them around the use of their medications, monitor them, tell them how to take it properly and all those sorts of things.

The outcome of this was quite astounding. The incidence of hospitalization, of doctors visits, of falls — all sorts of things — was reduced because of a very simple program that involved training volunteers to get out into the senior community. That is one example of how primary care reform could not only improve the well-being of a significant portion of our population but also make the system more efficient and manageable.

Another small example — and I'm dealing now again with the elderly, because that is the population that I am responsible for — is around falls. That sounds like a crazy thing — falls — but you know, falls are one of the main reasons that many elderly people end up in hospital. They end up in long-term care. In fact, it can often be the defining moment in their life. It is the moment between the time that they are independent and the time that they become dependent and in long-term care.

There is similar research around falls. It shows that if communities can embark on programs designed to ensure that seniors do not fall, which sometimes can be things as simple as putting non-skid flooring in the bathroom, making sure that the floors in areas where many elderly people are apt to congregate are fairly smooth…. These are very simple, non-medical solutions — things that can keep people out of care and out of hospital.

Those are just a couple of very simple kinds of reforms that we could manage, I think, if we direct our goals to preventing people from getting into hospital and into long-term care.

What of those who have to go into care? We have made a commitment to provide an additional 5,000 long-term care beds to the people of British Columbia, and this commitment was made in the budget that was delivered recently. I've often been asked: "Exactly what does that mean? What does it mean to build another 5,000 intermediate and long-term care beds?" Well, quite simply, it means that we need a range of housing and residential care options tailored to meet the unique characteristics of the clients that they serve.

The plan we are working on is one that will significantly transform the home and community care sector over the coming years. We are looking at a plan that will shift the system from one that is dominated by

institutional solutions to one that emphasizes support for clients in their homes through community-based services. I've just spoken of a couple of community-based services that can in fact improve the lives of elderly clients greatly while at the same time making the system more manageable.

The key to providing service to our elderly clients is to provide appropriate service. One of the things that happens too often is that our senior population is inappropriately served. Any one of us can go into any hospital in this province and can find many, many beds occupied by elderly people who really don't need to be in acute care. They are there because the resources are not in the community to serve them. The challenge, Mr. Speaker, is to find the right balance between residential care and the range of community and home options which we are encouraging the health authorities to develop.

I'd like to give you just a couple of statistics. In the fiscal year 2000-01 home and community care services were provided to about 118,000 B.C. residents. About 90,000 of those people received one or more home care or non-residential community services, while over 35,000 received residential care services. However, if we look at the funding, we find that about $1.5 billion was used to deliver the total services. Of that amount, over $1 billion was allocated for residential care, and about $500 million was spent on home care services.

What we see is that the residential care component of that budget consumes 70 percent while it serves only 25 percent of the clients. The challenge, I think, in this area of the health system — to make it more manageable and to serve the client better — is to ask ourselves: "Is that an appropriate allocation of resources? Can we do better? Should the mix be different? Can we meet the needs of more people with the same amount of money?" That is the path we have to embark on.

Studies have shown that many of the people for whom residential care is the only option could be well supported if community alternatives were available. Alternatives that have been explored in other jurisdictions have emphasized a combination of housing and health supports and flexible service that can be clustered around clients' needs.

We know that to be cost-effective, we can serve more clients with the same dollars if we can create appropriate resources that will divert people from residential care to community resources such as home care, supported living and assisted living. We can not only improve the quality of life, but we can improve the financial efficiencies of the health system.

In my remarks I have tried to show that the health system, which Canadians enjoy and which we value, is one that we must take very seriously as we examine the options for reform. I believe that if we do not look at the options for reforming our system, it may very well be threatened. With that, I will conclude my remarks. Thank you.

Hon. G. Plant: I am honoured to have the opportunity to rise today to speak in support of the budget and to offer some remarks about what I think is important about the process that government is embarked upon generally and also some comments about budget and vision issues as they relate to the Ministry of Attorney General and the treaty negotiations office, which I am responsible for.

I think the budget introduced earlier this week rightly can be regarded as marking a turning point in the history of the province. All budgets are a statement of the projected revenue and expenditures of the government, usually for the year that we're about to embark upon. Because budgets include a projection of revenue and expenditures, budgets raise the question of what it is government will do over the course of the coming year — particularly, how government intends to raise money and what the programs and services are that government intends to deliver that will constitute the expenditure of funds projected in the budget document.

The budget introduced by the Finance minister earlier this week is similar to all other budgets in that respect. It states revenues; it states expenditures. It breaks the expenditures down ministry by ministry, so we can see for the next fiscal year what funds government expects to spend across the ministries of government and across the other areas that government supports, including this Legislature, the independent officers of the Legislature and so on.

As important, I think, as the budget document itself, in terms of why I would say this week marks a turning point in the history of the province, is the fact that at the same time a budget was tabled, the Finance minister tabled a strategic plan for the government of British Columbia. I think that's what distinguishes this budget and this government from other budgets and other governments. Really, we introduced earlier this week not just a one-year statement of intention about how government intends to raise money and spend it but in fact a three-year budget, if you will — a three-year plan for what government intends to do over a much longer time horizon than is usually, or has been, the case in the history of this province.

For the first time, in a real sense, a government has come into this chamber and said: "We have a plan for three years, a plan that shows what we intend to do to generate economic prosperity, restore fiscal sanity to the government's finances and maintain the critically important public services." It lays out a road map for how we intend to achieve those fundamental objectives. It's really, I think, a turning a point in the history of the province for government to stand up and say: "Here is a longer-term commitment. Here is a longer-range plan for government. Here is a set of objectives and goals that will last beyond simply the current fiscal year and, because they last beyond the current fiscal year, will provide a set of benchmarks that will guide us over the course of the next three years."

The statement of estimates is a part of the package of material that the Finance minister introduced when he read his budget speech earlier this week. As I say, equally important if not perhaps more important to the longer-term future of the province is the fact that we now have before us a strategic plan. We now have service plans for ministries that show three-year objectives, three-year visions, three-year missions, three-year goals — a really amazing exercise, I think, in how to deliver a new vision of government in the province.

I wanted to spend a few minutes today looking at some of the elements of the strategic plan, because I think they're important enough to spend a moment or two on. We will have lots of opportunity in this chamber to talk about the dollars that are being spent and the revenue we hope to collect, but the strategic plan is a way of putting all that activity into a proper context.

I think that as good a place to start as any is the statement of vision. The strategic plan has a vision statement, and here is what it says: "British Columbia is a prosperous and just province whose citizens achieve their potential and have confidence in the future." We campaigned last spring for election on a platform document called the New Era document.

That New Era document itself set out a vision, and this vision statement I have just read represents a distilled essence of that campaign commitment into one sentence. I think it represents a marvellous target, a marvellous point on the horizon that we can all keep our eyes focused on as we do the day-to-day work we're required to do in this Legislature and as a government.

British Columbia can be and will be, if we maintain a clear-sighted adherence to our purpose, a prosperous and just province whose citizens achieve their potential and have confidence in the future. That vision works itself out into three interdependent goals. The three goals are these: (1) a strong and vibrant provincial economy; (2) a supportive social infrastructure; and (3) safe, healthy communities and a sustainable environment.

Those are three specific goals that we as a government believe it is important to pursue and intend to pursue as we work toward achieving and giving reality to the vision I have just referred to. These goals are interdependent: that is, a supportive social infrastructure is in fact a critical element of how we get to have a strong and vibrant provincial economy.

Similarly, a strong and vibrant provincial economy is an essential precondition for a supportive social infrastructure. Similarly, both of those objectives relate to the objective or the goal of safe, healthy communities and a sustainable environment. It starts in large measure with the recognition that economic prosperity is the essential precondition to much of the rest of what we seek to make possible, but we do not pursue economic prosperity alone. We pursue it in tandem with a set of goals that realizes or makes real the importance of other objectives. Those are the other two aspects — goals 2 and 3 that I talked about already. Those three goals can be broken down even further.

As the strategic plan makes clear, those three goals have links to the ten new-era vision statements so that the government's strategic plan and the vision that became part of our commitment to the people of British Columbia when the Finance minister stood up and introduced his budget, in fact, connects to the promises that we made to the electorate last spring and is consistent with those promises and represents the more detailed expression of how it is that we intend to achieve those goals and to make real that vision.

One of the changes in an approach to government, which we have set as our objective, is to move the idea of government away from a culture that examines simply the amount of money spent and focus more on what it is that government seeks to achieve with the programs and services that it provides. Traditionally, public administration has focused on inputs and outputs. The health care system is thought to be working better if we spend more money on it. In truth, however, the best measure of health care systems and services is whether, at the end of the day, we are healthier for them. If all of the money spent on health care does not make any of us healthier, then we have surely missed our duty to the people of British Columbia.

One of the things this strategic plan does, which I think is so exciting, is start to express in a very real and concrete way, as we'll see in a moment, some targets and objectives that focus on whether the things that we do as government are making a positive difference in society.

If you read the document, Mr. Speaker, you'll follow along, and after some parts of the document that I've already been talking about — the vision, the core values, the links to the new-era vision — there's a section entitled "Goals, Objectives, Key Measures and Strategies." This is where the document and the strategic plans start to make real this idea I've talked about of changing the focus of how government works.

There are objectives and key measures for each of the three goals that I referred to earlier. There are objectives and key measures to achieve the goal of a strong and vibrant provincial economy. Those objectives include the objective that British Columbia should have a skilled workforce, for example.

Under that heading is the very specific commitment to two measures: (1) a measure related to the percentage of the labour force with a post-secondary certificate or diploma; and (2) a measure that is referred to as percentage of British Columbia's workforce comprising persons employed in natural and applied science–related occupations.

The idea of a measure here is some way of not just measuring how much money we spend or how many people have signed up for a program but measuring outcomes that are related to the goals we have for the society that we live in. The measures then have specific targets associated with them. If we believe that we can and must measure the objective of having a skilled

workforce by identifying the percentage of the labour force that has post-secondary education, then let's set a target in relation to post-secondary education. That's what this document does. It sets this target: increase the percentage of the workforce with a post-secondary certificate or diploma from the 2001 baseline of 32.4 percent.

Now, part of the challenge that any organization faces, particularly a government, when it seeks to change its culture away from a culture of performance based on counting how many dollars are spent or how many people are engaged in an enterprise and change that focus towards results and outcomes is this: we're not always certain, at this point — it's not always easy to know — what the appropriate baseline measure is. Sometimes, in my observation across government, we'll discover that in fact we don't know as much as we ought to know about even the basic input statistics around how many people are in a program, let alone what ought to be the baseline measure against which our future performance can be assessed. A part of what this plan does is recognize the need over the course of the next year, the next few months, to continue to develop the appropriate baseline measures so that we can use them as the floor, if you will, for examining and assessing our performance against those measures in the months and years to come.

To come back to this example, if we can meet the target of increasing the percentage of the workforce with a post-secondary certificate or diploma from the 2001 baseline of 32.4 percent, then what we have done is made sure that there are more people in British Columbia with higher education. We have helped make sure that British Columbia will have a skilled workforce, which is our objective. If we have a skilled workforce and if we achieve our other objectives in this area, then we are, brick by brick, constructing the building blocks, the foundation necessary to ensure that we meet the goal of having a strong and vibrant provincial economy.

The second goal is a supportive social infrastructure. In that context the strategic plan says this: our systems of justice must be accessible, efficient, fair and affordable. We will ensure that our public institutions provide citizens with services that are responsive to individual choice, cost-effectiveness and service quality.

This is a part of what we mean as a government when we say that it is our goal to have a supportive social infrastructure included in our idea of the infrastructure of society. Included in our goal of achieving the supportive social infrastructure is the recognition that our systems of justice are part of that infrastructure and that we have goals for them as well. We have goals for the system of justice. Those goals include the statement that justice must be accessible, efficient, fair and affordable.

The specific objective that British Columbia will have a fair and efficient system of justice receives special attention later in the strategic plan. There are two measures identified for this objective. The first measure is a calculation of the number of appearances to complete a criminal case in Provincial Court. The target in relation to that measure is this: reduce the number of appearances to complete a criminal case in Provincial Court from the 2000-01 baseline of 5.6.

I want to pause here to talk for a moment about the challenge of identifying appropriate objectives and key measures for the justice system. The challenge associated with objectives and key measures for the justice system begins with a recognition that the government and the Attorney General of British Columbia constitute one or two actors on a complex stage of justice system actors. The other actors include a strong and independent judiciary. A strong and independent bar is also an important player on the stage of our justice system.

The federal government is an important player on the stage of our justice system because the federal government creates the Criminal Code, for example. The federal government appoints our superior court judges, courts of appeal and the Supreme Court of Canada.

Across the province there are community groups that are themselves important actors in our justice system, because they deliver some of the programs that are an important part of our justice system.

The government of British Columbia is one actor on this stage of many actors. Really, there is a limit to what the government of British Columbia, acting unilaterally, can achieve. Perhaps more importantly, there is a limit to what the government of British Columbia should seek to achieve unilaterally. Good justice system solutions, I think, are justice system solutions arrived at when all of the actors in the justice system work together. I recognize that as a challenge in terms of identifying objectives and key measures for the justice system.

A second challenge in terms of identifying what it is we seek to achieve for the justice system is to recognize that much of the work done by the justice system is, in fact, demand-driven. The volume of work that eventually ends up in the criminal courts begins with the volume of criminal activity in our communities. Government has a limited ability to control that. Sometimes I wish that were not so, but I think it's best to recognize the reality.

Similarly, government as an actor in the justice system really is, as much as anything, an observer and, thereafter, a participant in the reality that family life has become more complex, that family breakdown has become more common and that, in the context of a continually developing set of expectations around what it means to be a parent and what it means to be a spouse, the government of British Columbia has a limited ability to control the incidence of family breakdown — perhaps no ability at all. So we have to be careful when we look at the justice system and say to ourselves: "What is it that we as a government can set for ourselves as objectives and key measures?"

There are other challenges in terms of developing objectives and measures for the justice system beyond the two I've talked about, but those two are important: (1) the province is simply one player in a complex drama; (2) much of the work that becomes justice system work is created beyond the control of government. We as a government have to respond by ensuring that the justice system has the capacity to respond to needs that are created elsewhere.

With all of that as a set of complexities that make it a challenge to develop objectives and measures for the justice system, there are, I think, some objectives that we can set for ourselves. I already referred to the first measure, and perhaps I'll use that to illustrate the next point.

The first measure, as I said earlier, has to do with counting the number of appearances to complete a criminal case in Provincial Court. The target is to reduce the number of appearances to complete a criminal case in Provincial Court from the 2000-01 baseline of 5.6. Let me just put that in more concrete terms. What we're talking about is the number of times in which an accused person and/or their counsel have to appear in court during the course of a criminal matter.

Really, I think the average citizen could ask themselves quite legitimately: "How did we get to a situation where the current baseline average number of appearances to complete a criminal case is 5.6?" After all, don't you just show up on the day that you're charged, to plead guilty or not guilty and then set a trial date, and then come back for a second appearance on the date of trial? Well, in fact, it's more complicated than that. Sometimes the systems that have been designed and are intended to make things less complicated actually don't achieve the result in the way that we want them to.

This measure and this target represent a recognition on the part of the provincial government that our criminal justice system works more efficiently and more fairly if we reduce the number of unnecessary appearances or even the number of appearances to a minimum that is consistent with protecting the rights of the accused, ensuring that the Crown has the ability to prepare the case and that there is, where appropriate, a fair trial.

I think it's a legitimate target for us to set — that we reduce that number of appearances from the baseline of 5.6 which exists now. We don't need to set ourselves an unrealistic target in terms of that reduction, but recognizing that the public interest does not generally require multiple appearances in criminal cases is the first step on the road to making sure that our criminal justice system begins to operate more efficiently and fairly.

The second measure has to do with the proportion of small claims cases settled through out-of-court mediation in the small claims mediation program. This measure recognizes that a big and important part of the goal of this government is to expand the use of out-of-court mediation, to expand whatever programs and processes are helpful in terms of reducing the number of cases that actually end up in a courtroom for trial.

There are cases that absolutely have to end up in a courtroom for trial for a variety of reasons, and we should always make sure we recognize that reality when we design or modify or continue the institutions of our justice system, but there are many, many cases that can be settled before trial. Out-of-court mediation efforts have continued to demonstrate, across a variety of pilot projects in a variety of ways, that out-of-court mediation can be expanded to become an even more successful tool than it is now.

We've set ourselves the target, Mr. Speaker. The target is to increase the percentage of small claims settled through dispute resolution from the 2000-01 baseline of 56 percent. Again, it's not an unrealistic target, but it says this: if we can reduce the number of cases that go to trial by increasing the number of cases that are resolved before trial, some good things happen. Better dispute resolution, fairer outcomes, less burden on the court system, a more affordable court system and a court system that serves the public interest are all things that flow from a commitment to increase the number of small claims cases that are settled through out-of-court mediation.

The strategic plan goes on. It shows strategies and accountability for justice and safety objectives. It includes strategies and objectives in relation to the government's commitment to hold a one-time, provincewide referendum on the principles for treaty negotiators. The strategic plan is itself — even though I have spent the majority of my time here today talking about it — merely a stepping stone out into the service plans that each of the ministers have for their own ministries over the course of three years.

To come back to where I started, the commitment of this government is to manage and plan its affairs on a horizon that is longer than 12 months — a horizon that is three years long — in a context where there are clearly articulated goals consistent with a vision that is supported by an electoral mandate. I think that is a brave new way of governing and a wonderful opportunity to build hope and prosperity for the province of British Columbia in the twenty-first century.

J. Wilson: It is indeed a pleasure to stand here today and speak to the budget. I'm not going to delve into all the details in the budget, but I want to bounce around a little bit and touch on a few points and try to get across the way I see this unfolding in the next three years. These are exciting times. It's almost like taking a train trip, and we're just pulling out of the station and starting to move.

We have ended up as government. This is our first budget. We have a huge mess here — almost unbelievable. It's a legacy that was handed down to us from the previous government. We're looking at a $4.4 billion deficit — huge, huge. How did it get there? Have we increased government spending? Have we wasted the taxpayers' money? No, we haven't — not in the least.

We have actually cut. We have shrunk government spending in a lot of areas, and yet we still have a deficit of $4.4 billion.

The reason for that is that for the last few years we've had some windfalls in government revenues, and each time that happened, that government factored them into their budget and carried those costs on into the next year. We ended up with a structural deficit in this province of $4.4 billion. That means that the income that we can count on being generated by government each year is short of what we're spending. We have got to reduce that and get to a point where we can actually manage this province like a business and balance our books. It's very, very critical.

At this point there are a few things I would like to lay out here. Not all of them have to do with the government and the budget. We're breaking ground in British Columbia. It's exciting. We're doing things that have never been done here before. In this Legislature now we have free votes. We have a fixed calendar for sittings of the House, and we have fixed election dates. These are unheard of in British Columbia. We're breaking ground here every day. It's exciting. We have private members participating at all levels of decision-making in government.

There's something that we have just completed, if I could digress. There have been governments in the past that have tried to bring in cuts — across-the-board cuts, this kind of cut, that kind of cut — but never have we had one that brought in a process that allowed us to identify the wastes in government and to remove them.

For seven months we have been going through a core process. It is very detailed and has produced excellent results. It shows us where we can cut costs and still provide the services that are expected of us.

Something else has happened: we now have a three-year business plan for the ministries and a three-year business plan for Crown corporations. Government is a business — no different from any other business out there. Three-year business plans are critical to the success of any government. We asked for these in the past from the previous government. It didn't happen. There was no plan. There was no road map of where they wanted to take the province. That was unfortunate. Sometimes I think their idea of planning didn't go any further than what was for lunch.

This budget isn't really all that complex. It deals with three issues. First, we have to restore sound fiscal management in this province. It's very, very sadly lacking here. That was one of the promises we made in the election — that we would do that. Now we've arrived at the point where we can begin to do that.

The second is that we have to revitalize the economy of British Columbia. It's absolutely critical.

The third is that we've said we will put patients and students first in this province. In order to do that, the fiscal management and the economy all have to come in at the same time. Otherwise, that will become a very difficult task.

I first want to look at the structural deficit. The core review process identified a lot of inefficiencies, and it identified areas where there was a lot of waste in government. It gave us the opportunity to look at it, rethink it and find better ways of doing the same job with fewer dollars.

To get the economy going, the first thing we did when we became government was bring in a personal income tax cut. That was recognized as necessary, not only to help out the working families because they needed a little extra money just in their daily living. They spend that money in their communities. It goes back into all the businesses there, and it creates jobs. We recognized that, so we did that immediately. We also recognized that in order to encourage business in this province, you have to reduce business taxes. That has been done. In this budget we have raised the level for small business by $100,000.

The other area that has put a lot of businesses out of business, created a lot of bankruptcies in this province and forced a lot of people to move is the burden of regulations and red tape. We are dealing with that. We are cutting it. It was started right after the election, and it will be ongoing. In three years we will have accomplished what we set out to do, which is a one-third reduction in the number of regulations. It took a while to get a baseline, and that baseline in this province is really staggering: 404,000.

Another thing that will put our economy back on a sound footing is to remove business subsidies and let the marketplace take care of itself. Business subsidies do nothing but hurt business. There are a lot of things that are going to happen in the near future here. We're going to see changes in the forest industry, in our energy policies, in high-tech, in the film industry, in tourism, in agriculture. I can compare British Columbia to an engine that's been sitting there idling for years — ten years, actually. It's a long time. Each cylinder in that engine represents one segment of our economy, whether it be energy, forestry — whatever. It's only firing on one or two at a moment. We are going to rev this up, and we will blow the carbon out of this engine in British Columbia. We will get it firing on all cylinders again.

Mr. Speaker, the third part of our budget focuses on patients and students. We said that we would hold the spending for health care in this budget. We found out we couldn't do that. If we're to be criticized, I guess that's fair. We had to increase the budget for health care by 7.3 percent because of circumstances above and beyond our control, which weren't factored in. We had pay hikes to the nurses and to the doctors. We recognize that if we're going to have a health care system, these people are absolutely critical to have in place and to be there to work.

Not only that, we have to train more nurses and more doctors. We've already started this process. We are going to have more graduates from medical schools, and we will have more nurse graduates. We have established a satellite campus at UNBC to help in

the training of our doctors. By doing that, we will be able to maintain more doctors in our northern, rural setting. Up to this point, it has been very difficult to fill positions there. By training the people that live there, go to university there, they will come back and practise in those areas. It is one of the things that has to be done in order to get any degree of success at filling these vacancies.

Another thing which we have done, and I've personally received a lot of heat over, is the fact that we have freed up tuition in our post-secondary education. It was necessary in order for those institutions to be able to have some flexibility to provide a good level of service to the students that attend those institutions. From K-to-12 we have taken steps to give our school boards the flexibility they need so that the dollars that are provided can be used in the best way that they determine in each situation. Each school district is different from its neighbour.

Now that school board, locally elected, can have the responsibility placed on them to find a way of making this educational system work. The rigidity is now taken out of it to a large degree, and we feel that it is the first step to providing a better level of education to all our students in this province.

Mr. Speaker, British Columbia has got a huge potential — huge. I don't know how many can imagine.... I'm sure there are a few in the older generation who will concur with me; however, we have ten years of people in this workforce that have never, ever had the opportunity to experience what a healthy economy is — what they should expect from this province. Unfortunately, that takes in a big percentage of the workforce. For ten years we've had a socialist government in place. If you talk to them and say, "Can you imagine that you have endless opportunity here when you graduate from university," they look at you. If you say: "Minimum wage shouldn't enter the picture, because there's so much employment out there that businesses are going to pay above minimum wage if they want to hire employees…." That's hard to visualize, but that is the way British Columbia can be. That's the way it used to be.

Our young people will once again have that opportunity. They can pursue their dreams and their goals right here in this province. Most of us that are a little bit older won't have to become long-distance grandparents, as we do today. That is really good news.

Yes, Mr. Speaker, with this budget — even though it has a huge deficit — and the work that we've done through our core review, through the three-year direction where the ministers are going, where the Crown corporations are going, we are on the road back to recovery.

What can I say about the budget? Only one thing: right on — to the Minister of Finance for having the courage to present this today. I thank him from the bottom of my heart.

Hon. S. Santori: It is indeed an honour to rise before the House today to speak on the budget. First of all, let me begin by saying that the $4.4 billion deficit that is projected in this budget is not something that any one of us is proud of. As a matter of fact, we should all be very angry with the fact that we have a $4.4 billion deficit, but I don't think we can lose sight of why we're in that situation today.

We're also not very proud of the fact that we had to raise taxes. It's the last thing that the Finance minister wanted to do, but again we have to ask ourselves that important question: what were the alternatives? We were committed to health. We were committed to education, and that's exactly what this budget addressed.

There is no question that this budget is a tough one, and some tough decisions had to be made in order to carry out what this budget is intended to do. Even though we are going to have some very difficult challenges in the future, Mr. Speaker, I do not believe, and I know that my colleagues don't believe, that they're insurmountable. We can achieve those goals.

Where I am, and where there is hope in the budget that was presented before us, is that it laid out a three-year strategic plan. It does show a vision for British Columbia. It does show goals and objectives to the people of the province. They can see the direction that we are heading in. Needless to say, yes, we are going to have some disagreement on how we are going to get there, but we know ultimately what the goal and objective of this government is for the province and the people of British Columbia. I think it's important to note what the process was in order to get to where we want to be three years, four years, ten years down the road.

I want to commend the Premier for the process he put in place with respect to the government caucus committees, an opportunity for all members to be involved in a process, to bring their concerns to the table, whether they were urban or rural. We all had an opportunity to see and to give input as to how it would impact each of our respective communities.

This was not done behind closed doors by a select group. This was done by each and every one of us. We knew the positives of the process. We knew of the positive things that were going to come out of this budget, but we also knew what the shortfalls were going to be in terms of some of the sacrifices that we as all British Columbians are going to have to make over the next few years in order to get this province back to some sense of fiscal responsibility.

When I ran for office, I promised to be part of B.C.'s renewal, to restore British Columbia's potential and put this great province back to being number one again. There is no question that to do this requires the courage of one's convictions and perhaps even nerves of steel. Nothing would have made it easier for me or any of our colleagues to go back into our constituencies and say: "No, everything is fine. We don't need to do anything. We can just continue down the path we were on

Mr. Speaker, we would be doing the people of this province a total disservice if we weren't open and up front in telling them exactly what the problems are and the challenges we face. We came back with a bold plan, although not one that everyone is going to like, not one that everyone is going to enjoy and not one that is not going to come without sacrifices. Change is not easy; change is very difficult. There is no question that there will be people across this province who will feel some pain.

It's imperative, however, that we do come to grips with the fact that we do have a serious fiscal problem until such time as we can grapple and accept the fact and take the steps that are necessary to ensure that we live within our means, so in the future we can be bigger and can be better economically with respect to health care, with respect to education and with respect to providing services for those that are most vulnerable in our society.

There is nothing that will put health care and education and those services for those less fortunate at risk more than not dealing with our problems. I think we have to take into consideration that right now — and again we're not proud of the fact we are adding to the debt of this province — we are taking steps to deal with that.

The point I want to make is this. Right now as we speak, servicing our provincial debt is the third-highest ministry in government, if in fact it were a ministry, to the tune of almost — it will be, I believe — $2.8 billion a year. Let's ask ourselves the question: what can we do with that $2.8 billion? I don't think I have to answer that question.

As I said earlier, every community in this province is going to feel it. It's going to happen in my own back yard in the Kootenays. It's going to happen in urban and rural British Columbia. I was a councillor for five years and the mayor for eight years of a small community. I know what it means to lose jobs in a community. My own community went from a payroll of 5,200 people down to approximately 1,600, so I do understand as a mayor and as a councillor and as a citizen of a rural community what it feels like to lose employment.

I also know as a former mayor that we made great efforts and tried to make great strides to encourage business in our communities. There's a former mayor across from me here, and I'm sure he's gone through the same process. How many times have we sat down with communities and economic development commissions to be creative and to try to do things to entice people to come to our communities? I don't think I've ever been to one where the suggestion was: "Your Worship, can't we give them maybe tax-free status for five years? Can we give them a carrot? Can we give them some bells and whistles to at least attract them here?" Our own communities, when we were mayors, were begging us — unfortunately, the Municipal Act did not allow us to do such things…. But they themselves, people of our community, were saying we have to create an environment that's conducive to economic development and investment. We have to make it so that businesses can come to our communities and compete with the "A" word next door and the Pacific Northwest. They asked for those tools. Our budget has addressed that, and I think we have responded to what the communities need in order to be competitive.

Attracting new business in rural British Columbia has always been a difficult task, and it will continue to be one. But I think all municipalities in rural British Columbia — providing they are given the tools and they are put on a level playing field with the other provinces and the Pacific Northwest — have enough other strengths that they can build on with the tax breaks that we provided businesses and the new threshold from $200,000 to $300,000 to encourage businesses to grow and expand. Put small municipalities on a level playing field with their competitors, and we can show that as a community, we have the strength to move forward and to make it attractive and to entice people to come to our communities.

In the past ten years we didn't have that. We had nothing but disincentives to come to small communities. We had disincentives to come to the Vancouvers, the Burnabys and the New Westminsters. If it was a disincentive to come to the core of the province, you can only imagine how difficult it was for communities like Trail, Grand Forks, Castlegar, Nelson, Dawson Creek and other areas to attract those types of businesses. We were behind the eight ball, and we want to get away from being behind the eight ball.

Many of my constituents know me for what I stand for, and I stand on a record of civic duty and public service. I intend to remain a strong voice for rural British Columbia, as do all other rural MLAs and cabinet ministers. I can say with significant confidence, as I said earlier, that we did have a say. We were listened to. Yes, some feel our word wasn't listened to, but I'm confident that it was listened to.

I think the days of living today and not worrying about tomorrow have to end, and I believe that the previous administration did exactly that. I think what they did, and I think each and everyone of us has done it in our own households…. We see a sale in the newspaper: "Buy today. No payments for one year. Interest-free." I think that's what the previous administration did. They bought a lot of things; they provided a lot of expectations today with the hope that they have the ability to pay for it tomorrow. The fact of the matter is that we ran out of cheques. Not only did we run out of cheques, the previous administration wrote some post-dated cheques. Now it's time to buck up, and that money isn't there. We are forced to make some very difficult decisions.

I'm a proud father of two children. One attends the University of Victoria and wants to be a teacher. I want her to pursue that career, because I think there are some great opportunities. We're going to require skills like my daughter has, I feel, and many of her other fellow students have at the University of British Co-

lumbia. We must, at least now, paint a picture of hope for people like my daughter and my son — not just today. They have to look three, four and five years down the road. They want to be confident that the career they're pursuing will be there, so that they can carry out their dreams and aspirations.

I have a son who I am doing everything in my power right now to stop from going to Alberta. I keep telling him: "Hang in there. Things will change. Go out and get some skills, because when things turn around, you'll be in a position to take advantage of it." He's unemployed.

For those that sit across and some that don't agree, those who say that we don't care about our youth…. I care about my son just as much as they do, just as much as those that don't agree on the direction we're going. I want to make sure that my wife, my children, my aunt and uncle have access to health care. I want to make sure that my son has a future, something that he can look forward to. Right now he would do anything to get a job — not so much for the money, but for self-esteem. He wants an opportunity to go there and contribute and learn some basic skills, learn how to interact with people. He needs a starting point. There hasn't been one for these people for the past ten years.

I believe that what we are trying to accomplish in our budget is to give kids like that an opportunity to feel good about each other, to make sure that they get into a system where working becomes a part of life and falling victim to the system is not your first choice but your last resort. Unfortunately, in the past, because of the inability to bring businesses and create jobs, the system became the first choice. We want to change that. We want to change that system. We want to be there to assist people. We have to change the culture.

I know that the hon. minister is doing everything in his power to change the system to one where we will be there to help you when you need assistance, not to one of entitlement where you feel: "You owe it to me, and that's where I'm going." We know very well that once one falls to the system, it's going to be very difficult for that person to want to get out — notwithstanding the fact that, unfortunately, there will be several thousand people who will not ever be able to work. We do have an obligation to make sure that these people are taken care of, but we have to ensure that those who are capable of working do in fact try to work and get jobs so that we can have more resources for those who truly need the assistance of the province.

Mr. Speaker, I would like to spend a couple of minutes on my ministry. First of all, I'm very excited and honoured to be a member of the executive council. With it come many challenges and also many rewards. I'm committed to seeing my ministry take the lead in many areas. The mandate I've been given is an important piece of our overall strategy as a government.

I have the overall responsibility of revitalizing our public service. That sounds like a challenge, when we consider what we are going through now in restructuring and reorganizing our public service. I will not hide the fact that it is going to be a challenge. Now it is more important and more critical than ever that we put together a comprehensive human resource strategy and that we put a succession plan in place so we can take advantage of the best and the brightest in our system.

It's imperative that we put together a training and development program for our employees, to give them hope and opportunity so they know that if they work hard within the system, they can move up within the system. They won't have the fear of somebody just being parachuted into a position that they aren't prepared or competent to do.

My ministry — and this government — is committed to the public service. We appreciate the work that they do for the people of this province. As the ministry responsible, we are going to do everything we possibly can to give our employees the tools to be the best. We want the British Columbia public service to be the employer of choice.

I think it's appropriate at this time to commend those in the public service who have worked so hard over the last ten months to assist us in developing strategies and plans to deal with our next three years.

Another very important part of my ministry is the implementation and development of a shared-services model. Without getting into too much detail, the mandate and reasoning behind that is that we want to avoid duplication. We want to increase efficiency. We want to increase effectiveness. We want to be in a position where we can save money in administrative costs, consolidate so that there are more resources to go back into programs and services, and allow ministries to focus on their ministry work as opposed to what is taking place in back offices.

We have an obligation to the people of this province to make sure that we spend their money wisely and maximize those dollars in services like health care, education and dealing with those programs that deal with the most vulnerable in our society. There was not one term or one day, as the mayor of a city, where the people identified waste and said: "Why do you do this? Why do you do that? We're not putting enough money into this; we're putting more money into administration, more money into bureaucracy."

They're absolutely right. We have a challenge before us with the shared-service model. We have to change a culture that's existed here for decades in terms of how we do those operations. My ministry is committed to doing that.

We will be dealing with freedom of information and the protection of privacy. This province is lauded in North America, Europe and across this great country for having one of the best acts. We're very proud of that. I've been directed by the Premier to ensure that openness and accountability continue and that access to information is there. At the same time, we want to reduce compliance costs. It sounds a little contradictory; I don't believe it is. I'm very confident that we can be more open and more accessible and, at the same time, maximize taxpayers' dollars.

I just want to conclude by reiterating that this was a tough budget. We're not proud of the fact that there's a $4.4 billion deficit. We're not proud of the fact that we had to increase taxes. But I am proud of the fact that we have a vision, that there is a path of hope and that it's open to the public. They can go in; they can look at our service plans. There are no secrets; they're there. It allows them an opportunity to look at what we are trying to accomplish. It allows them an opportunity to comment. It allows them an opportunity to talk to their MLAs.

There's no question that when we undergo enormous change, we are going to make some mistakes. There's no question. I feel very confident that if we do make mistakes, we will correct them.

British Columbia was, and will continue to be, the province of choice in this country. We have so much to offer the people of this province. It's there; it's there for the taking. We have to ensure that we take the necessary steps to nurture the resources that are at our disposal. We have to ensure that we give municipalities the tools they require to put them on a level playing field so they can compete, so they can attract business.

There is no secret that the strength of this province will be on its economic recovery. I am very confident and pleased to be here today and rise in support of the budget. The goals that we have set out within that budget will achieve our ultimate goal of economic prosperity for the people of this province, for the youth of the province. The most important part, as I said earlier, is that it will not live just for today. We are building a path and a future for our youth. We owe it to them, within years, to be in a province where they can feel comfortable and get the services we provide and which will provide them with the opportunities to grow and prosper in the province that they love and care for. Thank you.

Hon. T. Nebbeling: Mr. Speaker, before I begin, I would first of all like to extend my greetings to the people of my riding. My riding is West Vancouver–Garibaldi. It's a magnificent constituency. It starts in West Vancouver, goes via Bowen Island up the Sea to Sky corridor — communities like Britannia Beach, Lions Bay, Squamish — right via Whistler to Pemberton and D'Arcy and even beyond there.

It is a riding that is known for its natural beauty, natural recreational opportunities, and it is the area that, if we succeed in bringing the 2010 Winter Olympics and Paralympics to British Columbia, will wow the world with its natural attributes.

It gives me great pleasure to speak in support of our government's innovative budget. I don't use the word "innovative" lightly. This budget is unprecedented in that it provides for the first solid step towards a balanced budget in 2004-05. Finally, British Columbia has a budget that provides for accountability, balance, economic growth, low income taxes and responsible, long-term planning. These are the components British Columbians have been asking for, and this budget is providing that desire by the communities to have responsible financial management in place for this province.

It's also a budget that clearly shows that our priorities for putting patients and students first stands above everything else. At the same time, we maintain our focus on revitalizing the economy of our province. In terms of talking about great challenges for revitalizing the economy, I want to speak to one of our brightest lights, and that, of course, is our bid to host the 2010 Olympic Games and Paralympic Games.

Mr. Speaker, I'm very proud that the Premier has challenged me with the task of coordinating our government's effort to win our bid for 2010 — a priority that is made evident through our support in the budget. I believe it's a big challenge, but I also believe that this province will succeed, indeed bringing the Olympics to British Columbia in the year 2010.

I would like to spend some of my time on outlining the economic benefits that this province will derive from the successful bid for the 2010 Olympics in British Columbia. But before I discuss the budget related to the Olympics in economic terms, I wish to first discuss the human issues and aspects of our bid.

After all, the Olympics are about people, not just dollars. It is showcasing both our province and its diverse citizens to the world. It is about putting our young athletes, our youth, our artists and our multiculturalism on an international stage for the whole world to see. It's about celebrating our diversity as a province and people and talent in a way that will dramatically unite our citizens and provide a major morale boost for all British Columbians.

This boost will give us the capability and drive to say to the world that B.C. is open for business and that we can provide for endless growth and opportunity in this province — growth and opportunity in dealing with our natural resources, growth and opportunity in the high-tech industry, the manufacturing industry, the knowledge-based industry and, of course, the tourism industry.

I know that B.C. has some of the most innovative, productive and skilled business and labour forces in the world, and I want the entire world to know this is also one of our opportunities. That is what an Olympic bid is all about: showcasing our people and our province.

I would now like to respond to the budget by speaking on the economic aspects of an Olympic event in British Columbia. Recently, my office made public an economic study entitled The Economic Impact of the Winter Olympic and Paralympic Games. One of the conclusions of this study was that bringing the Olympics to British Columbia would generate as much as a $3 billion incremental economic benefit. It would create

However, when our bid is combined with an expanded convention centre, the economic benefits go even further. It would generate up to an estimated $10 billion in direct and indirect economic benefits and create up to an estimated 228,000 direct and indirect jobs across the province. This would create up to $2.5 billion in total tax revenue, in addition to many other obvious major benefits such as permanent community arts and sports legacies.

As business communities are important players in shepherding all future economic growth, let me point out the following facts as they relate to recent Olympic host cities. If we look at Sydney, Australia, Sydney increased the number of international conference and convention bids by 34 percent after it was chosen in 1993 to host the 2000 Summer Games. Barcelona achieved a 21 percent compounded increase in international delegates in the six years following the 1992 Summer Games and a 29 percent increase in the year of the games.

These increases create wealth and create jobs. These are just two of the many examples where hosting the Olympics has brought sustainable economic prosperity — the prosperity that will also be duplicated in British Columbia.

There's more. I would like to talk next of the Olympic economic impact on our precious tourism industry. We all remember the precious and prosperous times during Expo 86 and prior to '86, when this province got together to host the world in Vancouver. We played international host to this world's fair, and when B.C.'s share of total international visitors to Canada jumped from between 9½ and 11 percent to 17 percent — a dramatic increase — it was the catalyst for the unbelievable growth we have seen in the tourism industry.

Of course, our visitors visit all parts of British Columbia when they come here. Ever since Expo 86, we have seen a constant increase from approximately 12 percent to 17.4 percent during the years following right up to now.

We can look at the pre-Olympic years between 1985 and 1988 at Calgary. Calgary's average annual growth of annual visitors grew from 0.25 percent to 5 percent in 1985 and 8 percent in 1988. During Calgary's Olympic year, growth surged to 12 percent. Then Calgary retained all of its post-Olympic gains, with an average annual growth of 3.25 percent for the first five post-Olympic years. Again, this is proof that bringing an event of an Olympic magnitude will have a long-lasting impact on the economy of this province, on job creation in this province, and we cannot afford not to have this opportunity.

In Norway international tourism increased by a whopping 43 percent between 1990 and 1994, leading up to the Winter Games in Lillehammer.

We can clearly see how it is very possible that the winning bid for B.C. to host the 2010 Winter Olympics and Paralympics, combined with an expanded convention centre in Vancouver, could generate up to an estimated $10 billion in direct economic activity.

Of course, in addition to that, we cannot forget about the following budget implications and social facets of our bid. As a consequence of the Olympics, we will have funding for amateur sports. We will add funding for transportation. We will leave a legacy of facilities and programs that over the long term will provide young athletes in British Columbia — and, for that matter, in Canada — opportunities to make themselves better athletes and be more competitive in the international sports arena.

Of course, part of the focus of the Olympics is on arts. We will have an arts legacy that will give artists the opportunity to showcase their abilities and talents to the world.

I take great pride in British Columbia's budget, as I know it will provide for a successful bid for the 2010 Olympics. It will make British Columbians proud to say to the rest of the world: "This is our home." This budget is about future stability, security and prosperity for all British Columbians.

Hon. C. Hansen: I want to take the opportunity that I have in response to the budget to outline some of the changes that we have made in terms of health services in British Columbia.

There has been a lot of misinformation, and there has been, quite frankly, a lot of fearmongering by individuals who, I think, are using seniors in British Columbia to advance some of their own political agendas. I find that quite distressing. I have had many phone calls from seniors around British Columbia. I've had many letters from seniors who are extremely fearful that somehow their health services are going to change in a way that they will not be able to cope with.

I've talked to seniors on the phone who have been in tears because somebody has told them that we're going to do away with the Pharmacare program. I reassure them that nothing could be further from the truth — that the changes we are making are minimal in their impact and definitely designed in a way that seniors who can't afford coverage will not have to bear the brunt of their health care costs.

I recall, in particular, a phone call that I received from a senior citizen in Vancouver. She was a retired nurse, and she left a voice mail message for me. In the course of the voice mail message she became increasingly upset. She was primarily concerned about what she had perceived to be the elimination of coverage for chiropractic care, and she was extremely upset in the message that she left. In fact, she closed it off by wishing that my bones would turn to jelly.

It was about 7:30 one evening when I retrieved this message. She had left her number, so I phoned her back within minutes of getting the message. I had a long conversation with her, and I tried to assure her that the changes that were made were really going to have minimal impact on her for a couple of reasons — one, because she was a senior citizen and, secondly,

because she had extended health coverage as a result of her pension arrangements as a former nurse. She was calmed down but still not convinced, because she had read and heard so much from those that I think were spreading the misinformation.

I want to devote my comments today to talk about the changes that we've made and how they're going to impact on seniors in particular. The changes that we announced in December around Pharmacare came into effect on January 1 of this year. What was in place before for senior citizens is that they would pay only the dispensing fee, which could be up to a maximum of $7.60 per dispensing fee. That would be paid by the senior citizen up to a maximum amount of $200 a year, and that's all. Once a senior citizen had paid $200 worth of dispensing fees for the year, they would then not be required to pay anything over and above that $200 deductible.

The change that we brought in, effective January 1, for 50 percent of seniors changed only slightly what the individual senior citizen would have to pay when they go to get a prescription. Instead of paying the maximum $7.60 dispensing fee, they would pay a maximum of $10 for the prescription including the dispensing fee. For most seniors they would see that where they had previously paid only the dispensing fee, they would now pay only the maximum of $10 per prescription. And once they hit the same $200 deductible, they wouldn't pay anything else.

The deductible last year was $200 for these senior citizens; the deductible this year is $200 for those senior citizens. That applies to every senior citizen in the province who is eligible for premium assistance for their MSP premiums. That includes just under 50 percent of seniors in British Columbia who are eligible for that premium assistance. The wealthier senior citizens, and I will outline shortly the thresholds for being eligible for premium assistance, who are not eligible for premium assistance — and for a senior citizen that would be a husband and wife both over the age of 65 with an income of up to about $29,000 a year who would still be eligible for premium assistance — would see a slight increase in the amount they would have to pay for prescriptions. Instead of being $10, it would in fact be $25 maximum per prescription that they would pay. Once they had reached the $275 deductible, that's all they would pay for the year.

That 50 percent of seniors who have higher incomes would see an increase from the $200 deductible they paid last year to a $275 deductible this year. They would see an increase in how much they paid per prescription from the maximum $7.60 to $25. We brought in these changes in a way that was to be fair, that would still allow us to deal with some of our budget challenges but not on the backs of seniors and particularly not on the backs of low-income seniors.

There is some concern that I have heard from other members in this chamber over the last few days about some increases in dispensing fees. I had an example brought to my attention yesterday of a pharmacy that had increased its dispensing fee above the $7.60 maximum that we will cover. In fact, it was $1.10 over and above that. We have found in the past that dispensing fees are very competitive. What we have urged people in the past, and I urge them in the future…. Every British Columbian should check out their dispensing fee, and they should find out who in their neighbourhood is most cost-competitive in terms of that dispensing fee. It is something that consumers should shop around for and find out where they can get the best pricing when it comes to that dispensing fee.

I also wanted to talk briefly about supplemental benefits, which we made some changes to. Again, the message that seems to have gone out says that we have totally delisted coverage for physiotherapy, chiropractic care, podiatry, massage therapy and naturopathic care — that somehow those are all delisted. That is not true. We have made some changes. The eligibility for coverage for those treatments now applies only to those who are on premium assistance. As I mentioned, almost 50 percent of British Columbians are currently eligible for premium assistance. We will make some changes so that more people become eligible. Those people who are eligible for premium assistance will continue to get visits covered. They get ten visits of their choice, whether it's to a chiropractor, a physiotherapist, etc., or to a mix of practitioners that they feel they need for their needs.

I also want to outline what the system was before and what it is now, because, again, there's a lot of misinformation. In the case of chiropractic services, prior to January 1 what the government would cover for someone on premium assistance for a regular visit to a chiropractor was $17.35. For somebody not on premium assistance last year, what the government would cover was only $7.35 because the patient was expected to pay a $10 personal visit fee. There are lots of people who will hear that and say: "Well, my chiropractor charged me quite a bit more than that. It wasn't just $10 that I had to pay; I had to pay $20 or $25." That's because many of these practitioners — not just the chiropractors but other practitioners as well — opted out of the MSP program. As opted-out practitioners, they were entitled to charge whatever their patients were prepared to pay. There was no regulation. Government would still pay the $7.35 for a visit, but they would pay it via the patient, not directly to the practitioner. That in itself caused lots of problems.

In the case of massage therapy, what government would pay for a regular visit was $15.46. Somebody who was not on premium assistance would have to pay the first $10 of that. Government was only paying $5.45. In the case of naturopathic doctors, the fee for a regular visit was $16.52, of which those not on premium assistance would have to pay the first $10. For physiotherapy a regular visit was $15.65, of which those not on premium assistance would have to pay the first $10. Again, many of these practitioners had opted out. In the case of podiatry, it's a bit more complicated because there's a range of fees that would be

paid anywhere from, for a regular visit, $14.66 to $17.51 — again the $10 patient visit charge for those not on premium assistance.

In terms of opted-out practitioners, 87 percent of our chiropractors had opted out of the Medical Services Plan. Of our naturopathic doctors, 76 percent had opted out. Of physiotherapists, 70 percent had opted out. In podiatry, only 2 percent opted out; that was basically because of the way their practice was constructed. In massage therapy, 82 percent had opted out. In optometry, 14 percent had opted out.

The change that we made provides for coverage only for those on premium assistance, but it also provides for…. Instead of this complicated so-much-per-visit structure that was in place, what we put in place was a $23 subsidy from government for a visit to any of these practitioners that would be provided by government. So if the practitioner was charging only the $23, then the person on premium assistance would not have to pay any additional visit fee.

I have seen examples of…. Some of these practitioners sent notices out to their patients. One that I saw said that because government was cutting off coverage for visits, they're actually going to provide themselves as a practitioner…. They would only charge $20 for the first 12 visits. That actually gives that practitioner an increase in what was being paid before. So I think there's been a lot of misinformation spread in terms of how these changes have affected individuals.

The other change that we've made, getting back to Pharmacare, is in terms of the deductibles for non-seniors. Those have increased; they've gone up by $200. For those on premium assistance, it went from a $600 deductible to an $800 deductible. I appreciate that for a lot of families on premium assistance, it is a big burden to try to cover that deductible. It was a big burden when it was $600.

But the good news is that the changes that have been announced to MSP premiums, when they go up on May 1, will actually increase the threshold for eligibility for premium assistance. It'll go up by $4,000. So what was previously a threshold level of $20,000 of net income after deductions will go up by $4,000 to $24,000. That now means that a husband and wife both over the age of 65 would be eligible for $9,000 worth of deductions in calculating their net income for this purpose. That means that a husband and wife both over the age of 65 could have gross income in the neighbourhood of $33,000 a year and still be eligible for premium assistance.

There are 230,000 British Columbians who will actually see a reduction in their MSP premiums. There are 230,000 British Columbians who will become eligible for premium assistance who are not currently eligible. They will be covered under these programs I've outlined.

I also want to put in context what's happening in other provinces. In the case of optometry, where we did make some changes to delist routine eye exams for those aged 19 to 64, British Columbia and Ontario were the only provinces in Canada that provided that coverage. The change we have done brings us into line with other provinces. There are no provinces in Canada that provide coverage for naturopathy or massage therapy. We continue to be the only province that provides coverage, albeit only for those on premium assistance. For physiotherapy, there are only three other provinces that provide any coverage. There are only three other provinces that provide coverage for visits to podiatrists. For chiropractic care, there are only three other provinces that provide coverage — well, actually four, if you include one that has some very, very limited coverage. So we are being consistent with other provinces, and we're trying to be fair to those that can least afford it.

Hon. Speaker, I wanted to take the opportunity to outline some of these changes. We have tried to be sensitive to those on lower incomes. We have tried to be sensitive to seniors in particular, and the changes that have been made are of minimal impact. We are looking to making further changes to Pharmacare. Starting next January 1, we're going to bring in an income-tested deductible, which will actually allow us to have more sensitivity for low-income British Columbians. At that time, we'll actually see that many lower-income British Columbians who are now facing that $800 deductible will see the deductible come down, depending on their income, which will allow us to bring to these vital programs yet another measure of fairness that we offer to British Columbians.