Hansard — Thursday, May 17, 2007 a.m.

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


Introductions by Members		8119

Second Reading of Bills		8119
	Finance Statutes (Innovative Clean Energy Fund) Amendment Act, 2007 (Bill 30) (continued)
	J. Horgan
	S. Simpson
	Hon. R. Neufeld

Committee of the Whole House		8125
	Knowledge Network Corporation Act (Bill 23)
	R. Fleming
	Hon. M. Coell

Report and Third Reading of Bills		8126
	Knowledge Network Corporation Act (Bill 23)

Second Reading of Bills		8126
	Legislative Assembly (Members' Remuneration and Pensions) Statutes Amendment Act, 2007 (Bill 37)
	Hon. M. de Jong
	M. Farnworth

Proceedings in the Douglas Fir Room

Committee of Supply		8132
	Estimates: Ministry of Forests and Range and Minister Responsible for Housing (continued)
	Hon. R. Coleman
	D. Thorne
	J. Brar

Hon. J. van Dongen: Mr. Speaker, I'd like to announce to this House that the member for Nanaimo-Parksville has a new constituent this morning, as of 3:23 a.m.: a little girl, 7 pounds, 7 ounces — the first child for my son Peter and his wife Clarice and a first grandchild for me and my wife Karen.

Hon. C. Richmond: I call adjourned debate on second reading of Bill 30, Finance Statutes (Innovative Clean Energy Fund) Amendment Act, 2007. In the little House, for the information of members, it's Committee of Supply on estimates debate for Ministry of Forests and Range.

FINANCE STATUTES (INNOVATIVE CLEAN
ENERGY FUND) AMENDMENT ACT, 2007
(continued)

J. Horgan: Now that we're all in our places with bright shiny faces, I'm pleased to continue debate on Bill 30, the Finance Statutes (Innovative Clean Energy Fund) Amendment Act, 2007.

When we rose on Tuesday, I believe, the Minister of Energy had introduced the bill with some preliminary comments, and he spoke as follows. He said: "We are backing up our aggressive greenhouse gas targets with a $25 million innovative clean energy fund to develop clean and alternative energy sources, not just in electricity but in transportation and the oil and gas sectors."

As I read through the bill — and of course we'll go at this in committee stage in more detail — I found that the reference to the transportation sector came as a surprise to me, because I didn't see reference to that. In fact, I saw explicit reference that energy from the transportation sector was not included in this bill.

With that, I'll just carry on with my remarks. I had left the chamber speaking about the benefits of B.C. Hydro, and its near 95-percent clean, green energy with respect to electricity. I hadn't touched on some of the other subsidies and incentives that the current government provides in this sector, like the oil and gas sector, in the energy sector, particularly with respect to oil and gas.

During estimates debate my colleague from Vancouver-Fairview and my colleague from Vancouver-Hastings spent some time with the minister on the line items in the budget that indicate subsidies to the tune of $263 million to the oil and gas sector — a very profitable sector, as we all know. Certainly, when we look at retail gas prices, the profits are wildly beyond anything that would be considered reasonable by British Columbians.

So when we see windfall profits, when we see investment to capture those windfall profits, it seems incongruous for many British Columbians as to why the government would subsidize the sector to the tune of over a quarter of a billion dollars. But when we look at addressing the greenhouse gas issues and the climate change challenges of our time, the government puts forward a modest amount of $25 million, and it's not only a modest amount, but it's going to be collected from the pockets of taxpayers.

At the time that the throne speech was issued and discussion began around what that tax or levy would look like, there was a good deal of speculation that it would be a high figure. The minister said in his comments that it was 0.4 percent of final sales on electricity, natural gas, grid propane and fuel oil, and over the course of a year the impact on consumers would be in the range of ten bucks.

Now if that's the case and if that ten bucks is going to be constant over a long period of time, I think that most consumers would make that contribution willingly and gleefully if it can contribute to addressing the challenges we have with respect to climate change. But the concern, as always when a levy is imposed, is that it starts at 0.4 percent, and then it rises to maybe 2 percent, and then it's 5 percent, and then it's 10 percent.

When we look at B.C. Hydro, for example, over the past three years…. In 2004 the Utilities Commission allowed B.C. Hydro to raise its rates by 4.85 percent, and then again in February 2007, another increase of 3.4 percent and classified that as an interim rate increase. So over time we're seeing significant increases in our hydro costs.

We are blessed, as I said earlier, with having among the most green systems in North America, if not the world, as a result of our two-rivers policies back in the 1960s. We've talked about that, the minister and I, in estimates and off line — that the visions of W.A.C. Bennett and the MLAs of that day to put in place a two-river policy that has benefited not just British Columbia but Canada was profound. And I think that the public looks to us today for some profound thinking on how we're going to address climate change.

I'm not certain that a $25 million fund is going to do the trick — quite the contrary, hon. Speaker. I'm thinking that if I had $263 million lying around to give to the oil and gas sector, I'd probably pull a little bit of that back, leave consumers alone and invest that money in alternative energy sources. That's certainly something that we would propose on this side of the House, and when we get to committee stage, that's certainly what we're going to do.

The fund also talks about investing in risky or precommercial technologies. Again, that's something most British Columbians would embrace. I think we recognize that if we're going to develop the technologies and the practices that are going to take us into a future that is carbon-neutral, we have to invest in that, and that's why we're going to support the bill.

The challenge for government is to be realistic. You can't go out in February and say, "We've had an epiphany. We've come to the realization that climate change is real, climate change is here, and climate change needs to be addressed," and then say: "How we're going to go about that is we're going to tax people on their hydro bills, home heating bills and natural gas bills to raise $25 million." What we're going to do with that fund remains to be seen. We have generalities about the technologies. We have generalities about precommercial or almost commercial investments.

I think that most people, when they reflect upon government's track record at investing in the private sector….

J. Horgan: Well, most governments. I like the back-and-forth with the minister. We've talked about that before. We look at the world differently, and that's what makes it an interesting place. That's what makes it an interesting place, not just in here but outside of here.

The minister needs to be reminded, as do many people on that side of the House, that it's not just the 33 of us here that see the world differently. There are hundreds of thousands of British Columbians who embraced our perspective and rejected the perspective of the other side. It's not 46 to 33. It's hundreds of thousands and hundreds of thousands. You have to have a broader view of the world, I think, than sometimes the government members have.

I understand the isolation of cabinets. You go into the room. The windows are shut. The blinds are pulled down. The ideas are restricted to option A or option B. There's no grey area; it's all black and white. But the real world is quite different.

I know those in the gallery watching today, when they leave this place, say that it's a sunny day, and they have different perspectives. Spouses have different perspectives; family members have different perspectives; neighbours have different perspectives. All are valid when it comes to the question of climate change, however.

Certainly, we've seen polling. We don't need to see polling. We can talk to our communities. We hear it day after day after day. The profound issue of our time is addressing greenhouse gas emissions. British Columbia is in an enviable position with respect to our hydro resources, and I expect that most British Columbians understand that.

The government is also spending a great deal of money on unproven hydrogen technology. Again, we had a discussion, the minister and I, in estimates on that. It's a sexy undertaking, but the greenhouse gases produced to create the hydrogen to move the buses or to create the fuel cells are almost as great as the GHGs that you would produce from burning diesel fuel, for example.

The question for those who are paying attention to these issues…. The science on the matter says that perhaps hydrogen might not be the precommercial investment that we would want to make with the dollars that are already going in, or certainly with the dollars that are being proposed in the innovative clean energy fund.

Risk-taking, the members on the other side will say to us over and over again, is something that we should leave to the private sector, and by and large, I embrace that notion. Most members on this side of the House do as well. So when we have a fund created to assist those taking risks, I think that people pause. The Minister of Environment took a shot at me earlier on in the debate on that comment, and that's fair enough.

Where is the risk in the oil and gas sector? Where is the risk with windfall profits? ExxonMobil had $39.5 billion last year, with a little help from the province of British Columbia, no doubt, from the $263 million in subsidies to that sector. I don't see a lot of risks in oil and gas, not from an investment perspective. That's for sure. I don't see a lot of benefit on the greenhouse gas side from subsidizing the oil and gas sector.

It's that incongruity that leaves people wondering just what the motives are of the members on the other side. I don't doubt for a minute that they are not seized with the importance of addressing climate change. I don't doubt that for a minute. I know they're all honourable members, but $25 million out of the pockets of taxpayers for unproven precommercial technologies versus $263 million out of the taxpayers' pockets directly to shareholders in the oil and gas sector…. That's a challenge for most people.

You know, when I rail against the oil and gas sector and the gouging of consumers at the gas pumps, hon. Speaker, again I'm ridiculed on the other side that that's inconsistent with a climate change argument. I don't believe that at all. There was an instance last year — I think it was 18 months ago — when the Victoria transit commission came to government and said: "We would like you to allow a one-cent increase per litre in the gas price so that we can take that money and invest it in transit." The Minister of Transportation at the time said that consumers wouldn't stand for it.

Since that time oil and gas and gasoline prices in particular have gone up 25 cents. Not a penny — not a fraction of a penny — of that money is going to transportation alternatives. Not a fraction of that 25 cents is

going towards commuter rail on Vancouver Island, for example — not a fraction of that windfall profit that's going directly to oil and gas companies and directly to their shareholders and bonuses to their CEOs for reaping those profits. Not a fraction of that is going to transportation initiatives in the lower mainland. Not a fraction of that is going into developing technologies to reduce greenhouse gases.

On the contrary, the windfall profits in this sector are going towards more windfall profits, reaping more money. Are they reinvesting that money in refining capacity so that we can reduce the supply crunch that the industry tells us is resulting in higher prices? Not at all. There are no proposals that I'm aware of in British Columbia to increase refining capacity. There are no proposals that I'm aware of to increase refining capacity in and around British Columbia.

It's a pretty good game. It's supply and demand, as I've called it. The companies have the supply, and they demand we pay whatever they put on the pump. That seems unacceptable to most of the people in my community.

Back to the issue at hand, however, and that is the innovative clean energy fund. In estimates with the minister we touched briefly on this, until the Chair wisely advised us that this was a bill before the House, and we couldn't have that discussion. When we get to third reading, or committee stage, as it's called, for those who are watching at home — my mom; All My Children is not on yet, so she's watching one of her children — we'll be able to ask the minister in more detail what he meant in his preliminary comments about transportation and how this fund would address transportation energy technologies.

Another point that I'd like to make is that in the preparation of this bill there would have been a requirement for some form of consultation with those in the marketplace. I think of Carmanah Technologies here on the lower Island in Greater Victoria. Whether the government or the minister in particular had any technologies in mind, whether they had established or thought of establishing a panel of experts to help distribute these funds once they are collected — these are issues that are not made clear in the bill. I don't know if we'll see them more clearly at the regulation stage. Again, at third reading the minister will want to have some answers for myself and members of the public on that.

There is also a cap on high energy users, so the 0.4 percent applies to all homeowners, but there's a cap on heavy industrial users. I think that, again, the public would have some sympathy with that. Those high energy users are constantly, I know from my time in the sector, on the lookout for ways to reduce their energy consumption, not just for the benefits to the planet but for the benefits of their bottom line.

Having a cap is, I don't believe, an unreasonable thing, and I would support the minister, but I do look forward to a discussion at committee stage about why the minister landed on that cap. Why 500,000, and so on?

I'd like to go back just for a minute to talk about the notion of precommercial. The concern always is — I'm genuine when I say this, and I know that it deserves a heckle or two from the Minister of Environment if I'm off base here — picking winners and losers. I've heard from the other side so many times that it's not the government's role to pick winners and losers in the economy, in the private sector.

Again, we disagree on that to a certain extent. I think of examples like the film industry — an ideal sector to provide incentives for economic activity, not just in the lower mainland, as we've seen over the years, but here on Vancouver Island, in the interior and even in the north. That's a reasonable thing to do. It's a highly competitive industry. British Columbia has comparative advantages when the dollar is low, less so when the dollar is high.

Providing incentives or tax breaks to that sector makes sense. Although the government railed against subsidies or incentives or picking winners and losers in the economy in their first term, I think we were all pleased to see that there was a recognition in 2005 that the film industry, as an example, is one where incentives were beneficial not just to the regions where the activity was taking place but to the province as a whole.

Why, then, would we look at the energy sector any differently than we would at some other portion of the economy? The government has said historically that winners and losers are the result of the vagaries of the marketplace, and that the invisible hand will determine who wins and who loses.

The realization is that with respect to climate change we might want to start seeing if we can invest in those that appear to be winning and ignore those that appear to be losing. That contradiction will have to be made clearer when we get to committee stage.

Overall, just in conclusion before I give way to my colleague from Vancouver-Hastings, I want to say that we on this side of the House do support this bill in principle. As I say, when we get into the details at committee stage, we'll be able to clarify some of our concerns. We do support an aggressive campaign to reduce greenhouse gases, to do what we can in British Columbia to meet our international targets with respect to treaties and commitments that the government of Canada has made — not just for British Columbia but also for surrounding jurisdictions.

One of the advantages — as I said at the beginning, I said in the middle and I will say at the end — of living in this great province is that every time it rains, we're able to capture that water and later generate electricity. It's clean, green electricity — not coal-burned, not gas-fired, but clean hydroelectricity.

The notion that we need to focus on conservation in that sector is absolutely vital, absolutely important. At the announcement of the energy plan I gave full marks to the government — and to B.C. Hydro in particular, of course — for accelerating their Power Smart program so that we can meet 50 percent of our new energy demand from conservation measures.

These are the sorts of innovations that I'm hopeful the government has in mind with their $25 million. I'm

hopeful that they'll have ways of increasing this and of incenting people to reduce their consumption by using technologies that will be developed from this fund. I'm hopeful that that's where they are going.

I know the minister is sincere. I know his colleague the Minister of Environment also recognizes that we need to reduce consumption, not just of electricity but of other energy products. If we can do that through this fund, all the more power to us.

I would say, though, as I did at the beginning, on the moneys — the quarter of a billion dollars that's going to the oil and gas sector to incent their activity — that the time for that has passed. A review and an assessment of those initiatives should be undertaken forthwith, and I'm hopeful that the climate change committee that the government has established will do that.

At the time those subsidies were initiated, there was a desire to end the seasonal nature of the industry. I supported it then, and I would say that to this point in time it's been a significant and successful initiative. But when you look at the profit margins we're seeing today in that sector, it's hard for the public to understand why British Columbia would give a quarter of a billion dollars to oil and gas.

With that, hon. Speaker, I thank you for allowing me to have some time today to speak to this bill, and I look forward to a more detailed discussion with the minister at committee stage.

S. Simpson: I'm pleased to have the opportunity to stand today and to speak on Bill 30, the Finance Statutes (Innovative Clean Energy Fund) Amendment Act, 2007.

This bill comes out of the recently announced energy plan of the government. The purpose of the bill really is to establish a fund of $25 million that can be used to support a number of initiatives related to alternate and clean energy.

The money will be garnered through a levy on energy. The government suggests that about a 0.4-percent rate on electricity, natural gas, grid propane, fuel oil and other non-transportation-related money will be used to raise the fund of some $25 million.

It also, in the notes that the government has provided around this, has suggested that for our high-use energy customers, many of them in the corporate and industrial sector, there will be a cap of about half a million dollars annually on those customers in terms of the amount that will be charged, of the amount that they will potentially pay into the fund.

The accompanying press releases that came with the release of this bill suggest that about $8 a year is what we're going to see in terms of costs for those people who use natural gas or electricity for their heating.

When we look at this, I don't think anybody argues with the notion that we need to develop resources to support the development and creation of alternate energy. That is important. It's an essential thing for us to do, and as my colleague from Malahat–Juan de Fuca said, we will be supporting this bill when it comes to a vote, because this is a first step.

However, having said that, I do want to talk a little bit about this bill and about some of its intention and how that relates to the bigger plans that this bill is meant to help address. We know that part of the initiative here goes back to the announcements in the throne speech related to climate change and to achieving some of the objectives of the government around climate change. So I think it's important to make some of those connections, those linkages, in determining whether this bill is actually taking us where it is that we need to go to meet those initiatives.

What we know is that when we talk about climate change, there are a number of sectors that we need to find support for if we're going to reduce emissions. We know transportation, being the largest of those…. About 40 percent or so of our emissions are out of the transportation sector, and we'll need to address that. There will be challenges around that. One of the challenges is that the government, at this point, doesn't appear to have a strategy to moderate the growth in the number of vehicles on the road or to reduce the growth in the number of vehicles on the road.

We saw that ICBC has reported in the most recent budget that they anticipate about an 11-percent growth over the next three years in the number of vehicles on the road that they expect to be insuring. That's a pretty significant growth in vehicles. It's going to be very challenging for us to meet our climate change initiatives if we're in fact not making more substantive and significant efforts than I think are proposed to date to reduce the growth in the number of vehicles on the road and to find alternatives that encourage people to get out of their cars, to get into transit and to take and look at options.

Another sector that needs to be worked on, clearly, is land use issues. We know the Premier at the Union of B.C. Municipalities spoke about some of these issues. He spoke about compact communities. He spoke about the need for more smart-growth options.

We'll look forward to seeing what kind of initiatives the government brings forward to work with local governments on land use issues and around local planning issues — to be able to encourage local governments and regional districts to, in fact, develop a strategy that encourages more compact communities and that looks to reduce sprawl, that looks to create options and alternatives for people to live closer to where they work and to reduce their transportation demands. As we make the effort to do that, that will also be a significant piece.

The other piece — and the piece that this piece of legislation most directly deals with, of course — is all of those areas related to energy and the production of energy. When we talk about energy, though…. My colleague from Malahat–Juan de Fuca spoke about this and talked about where the energy plan goes. What we know about the energy plan is that it does continue to

promote the oil and gas sector. That's obviously a very important sector in our province. It's a great wealth creator and wealth generator for our province. The dollars that come out of oil and gas pay for an awful lot of the services that British Columbians receive.

The question becomes: do we need to be putting more than a quarter of a billion dollars of subsidies into that sector at this point in time, considering how well the sector is doing, considering the money that's being made in that sector, considering the prosperity of that sector? We're planning to give about $263 million to that sector this year. We will do it again, probably in slightly increased amounts, next year, the year after and the year after that. Those are the intentions of this government.

We have to question whether that's the best place to put our money in terms of energy, if in fact we're looking to accomplish the kind of objectives that are suggested in this piece of legislation — the kind of objectives that the energy plan talked about. That needs to be to transition…. I believe the plan is to transition by 2016 to having green energy meeting our increased energy demands.

That will mean looking at alternate energy proposals. It will mean finding ways to support those proposals. I would suggest that $25 million going into that is miniscule compared to the $263 million that we're looking at in oil and gas. That $263 million is pretty much at this point, in my view, established around conventional oil and gas.

We don't know at this point what will happen with offshore should the government find a way to begin to look at the offshore question. We have no idea what kinds of additional dollars may be invested by this government in subsidy for exploring and looking at options offshore. We'll have a chance, I'm sure, to have that discussion at a later time. It is an important discussion, because there's obviously a great amount of concern around the province about the prospects of offshore oil and gas, what that might mean for British Columbia and certainly what it might mean environmentally.

Getting back to the question of this particular fund and the dollars that are proposed to be spent here — the $25 million. I think it does raise some questions about how that money gets raised. There should be a question. If we're looking to reward green energy, if we're looking to reward those who use green energy, then it does raise questions about whether in fact we should be looking to take these dollars off of hydroelectric power.

That's the greenest energy that we produce in this province from our dams. The minister has said that on numerous occasions, and I agree with him. The energy that comes out of our dams is very green. It is part of our success story in this province in terms of being able to keep our emissions in check relative to a number of other provinces because we in fact have had that hydroelectric option, which has saved us an awful lot in terms of emissions. But now this proposition says that we will take those dollars from that.

The other thing that we know is that in the case of who should be paying this…. We're going to need to have a discussion around the question of emissions and how we deal with those emissions. I'm sure that the cabinet committee on climate change will deal with this, but we may find that it's time to talk about the carbon tax and carbon-shifting models. Maybe we should be looking at getting this $25 million out of those who produce the most greenhouse gas emissions as a way to begin that discussion about who pays for green energy. Should it be those who create the most challenges?

I think that these are all discussions that we need to have. We also need to talk about whether a single mom should be paying at the same rates as a corporate participant.

I think that there are a number of questions here, questions about whether this is enough, questions about whether it's balanced compared to the $263 million that goes to the oil and gas sector, questions about who we should be getting this money from, questions about what's fair and questions about how we in fact deal with beginning to use this strategy as a way to shift to addressing a change in how we look at sustainability and a change at how we look at dealing with greenhouse gases generally.

I'm looking forward to that discussion. I'm looking forward to being able to speak to that when we get to committee stage, and I'll look forward to engaging the minister and getting some answers to those questions at the time we do that. At that, I'll take my place, and we'll move on.

Mr. Speaker: Seeing no further speakers, the Minister of Energy and Mines closes debate.

Hon. R. Neufeld: It's certainly interesting to sit here and listen to some positions. I'm not sure if they're positions. I mean, it's one position today and another position tomorrow and something else next week and something from a year ago that the two members got up and talked about.

Let's just quickly review a couple of those. We've heard the critic for Environment and the critic for Energy and Mines talk about that the price of gas should be lower. They've all been talking about how the price of gas is too high. We should be using more of it. We should have gas cheaper so people can burn more of it. Just now in the House they turned around and said that those sectors of the economy that release the most greenhouse gases should pay the largest price. Well, guess who releases most greenhouse gas in the province of British Columbia. It's transportation — 40 percent of it.

I guess on one day they advocate for lower gas prices. When they stand in the House, they advocate that we should put more taxes on gasoline, because they're the largest emitters of greenhouse gas. [Applause.]

They clap for that right now. That's interesting. I will remember that, because it's a very interesting — I guess fence-sitting, or fence-straddling is probably a better term — position to take. That's not untypical of that group across the way. Whatever comfortably hits them to say, they actually say it.

Hon. R. Neufeld: Actually, if the member from Victoria wants to heckle, I don't mind that, because I know it hurts a bit. But it's done from his own seat. That's where he should be, so I suggest that he move up and do that.

There are some huge inaccuracies of what these people say, and that should not surprise anyone in the province either. I'll point out a couple of them. One is that there's a $263 million subsidy per year to the oil and gas industry. They have been given that information. They have been briefed by the ministry — not by me, by the ministry — of how much it is, and yet they continue to say in here the wrong numbers. That's a cumulative number from 2003 to the end of the fiscal year '06-07.

We have different royalty rates to encourage the industry to go into high-cost areas to develop oil and gas reserves which we all use. I have to remind them that there are not many electric cars in British Columbia. Actually, most vehicles that I know of today in the province are run on gasoline. You get gasoline from oil, not from a hydro dam. So they need a little bit of straightening out on that too.

Out of that $263 million, from mid-'03 till the end of fiscal '06-07, the province actually received more than $1 billion more in revenue to pay for health care and education, with those programs in place. You know, that's the part of math that these folks don't understand. What they understand is: let's just hit everybody, including the consumer. Let's hit them harder for gasoline and make them pay more money. Let's hit everybody with more taxes.

That's what happened in the '90s. That's why we had an economic downturn like this province has never seen. It was an economic wasteland, an investment wasteland, during the 1990s because we had a whole bunch of socialists on this side of the House trying to run economics in the province. They still haven't learned it. They've been in opposition for another seven years, and that's exactly where they should stay. That's where they should all stay.

For me, a billion dollars is a pretty good return. Not only that…. Socially, there's a very good return on doing those kinds of programs. I know that very few of the members have ever gone up north and had a look around to see the boom and the people that work year-round. There's employment year-round, and the communities are stable year-round because of those programs that were put in place to encourage that kind of industry year-round.

Let's go back to the 1990s for just a quick little time. You know what, Mr. Speaker? The critic talked about ExxonMobil and how much money they made last year — all that kind of stuff — and talked about how terrible it was and that they got some of that from British Columbia. Well, interestingly, that company works worldwide. To my knowledge, they don't exactly invest in British Columbia at all. That's the truth.

Secondly, when they were in office in the 1990s, guess what they did for Esso, which is a Canadian subsidiary. Guess what they did for Esso. They actually reduced their royalties for oil to encourage them to drill for more oil in northeastern British Columbia. But just one company — just one company.

Then a few years later they decided that — my goodness — we should give some subsidies to another company, so they went out there and gave zero. They actually reduced royalties to zero — to nothing — to encourage a company to drill between the border of British Columbia and Alberta. Guess what. Not one person from British Columbia worked on those projects — not one person. They brought them from Alberta. That's why Ralph Klein used to say that these guys were his best economic developers that he had ever seen in the province or in British Columbia.

It's interesting when you start bringing some of these things back home to those folks. I know it hurts a little bit to tell them about these kinds of things.

The other thing is that they had a program about electricity. It was called, I think, Power for Jobs. It didn't create any jobs, but they gave away a lot of power. Talk about picking winners and losers. They went to industry, and they picked the ones that were doing the worst, and they said: "Guess what. We're going to give you power for nothing, almost nothing." Guess who paid for that. All the ratepayers in British Columbia — the whole works of them.

In fact, when I came to office, some of those contracts were written so lousily that we couldn't even collect and had to write off tens of millions of dollars because of their ineptitude. Today they try to stand in the House and talk about how wise they are. It's almost too much to take.

When we hear that the member from Vancouver-Fairview talked about how subsidies were terrible in the province, I'll tell you how observant that person is. When I talked about oil tankers that come into the port of Vancouver, he said he'd lived in Vancouver all of his life and he didn't even know that took place. So all of a sudden he's questioning whether we should be giving what he terms "subsidies" or different royalties to develop different kinds of oil and gas.

Climate change is real, and we're addressing it. The fact is that greenhouse gas emissions in the '90s rose the highest that they ever have in British Columbia — during those ten years, a 24-percent increase in greenhouse gases. They had a gas-fired strategy for generating electricity in the province — not water, not clean energy — and in fact have opposed almost every clean energy project that's been developed in the province since 2001. Today they try to talk about how they approve of them. It's just a little bit too much to take.

Hydrogen. They're against hydrogen, one of the cleanest fuels we know of. Nothing comes out of the tailpipe but water. Guess what. They just stood up and said that we shouldn't be wasting money on hydrogen. It's absolutely unbelievable, Mr. Speaker, when we go back to the '90s and see how much of taxpayer dollars they invested into hydrogen.

This is a good bill. This will take us into the future. This is what we need to actually deal with greenhouse

gases, with congestion, with traffic. All of those kinds of things are all wrapped up in this. It's just that this group doesn't want to accept something that's good — something that's good for British Columbians, something that will see us be leaders worldwide. I know they don't want to see that.

They quietly want to see it. They want to be under the fence, just peeking over the top a little bit and saying: "I kind of approve of that but not much." They're all standing there doing that same thing.

It will be interesting when we get to committee. I can hardly wait. I can hardly wait to get to committee to debate each one of these nine sections. I can hardly wait to see how many more times these folks will straddle that fence and try to stand on both sides of it and act like a capitalist one day and like a socialist the next. It'll be an interesting time.

D. Routley: …be called a goof. I think that was the remark. Will it be withdrawn?

Second reading of Bill 30 approved unanimously on a division. [See Votes and Proceedings.]

Hon. R. Neufeld: I move that the bill be referred to a Committee of the Whole at the next sitting of the House after today.

Bill 30, Finance Statutes (Innovative Clean Energy Fund) Amendment Act, 2007, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

Hon. M. de Jong: I call committee stage debate of Bill 23, the Knowledge Network Corporation Act.

The House in Committee of the Whole (Section B) on Bill 23; H. Bloy in the chair.

R. Fleming: I want to ask the minister about section 2(4) in this area — the description of the corporation not being an agent of government. I just want to ask some questions about the implications of that.

First of all, it seems very curious that this description is included and that this designation or distinction is made, considering that the board of directors of course is appointed by government. The sole shareholder of this entity is the citizens of British Columbia, the taxpayers of B.C. It seems to me that there may be some implications here around disclosure and accountability — how British Columbians hold to account the Knowledge Network for the programming it provides with their money.

I wonder if the minister could tell me what the description of the corporation not being an agent of government means for whether there are financial statements provided to the citizens of B.C. through the public accounts of the province and whether it's part of the reporting entity of the province of B.C.

Hon. M. Coell: Simply, the CRTC broadcasting licence requirements need it to be not an agent of government. But it would still have a service plan, quarterly financial statements and then a financial statement at the end of every year.

R. Fleming: I suppose this is probably for regulations, but the reporting of the financial statements would be in conformity with all other agencies and Crown corporations and arm's-length agencies of government. I wonder if the minister could confirm that.

Hon. M. Coell: Yes, that's correct. They would also be audited by the Auditor General.

I'd like the member for Columbia River–Revelstoke to please come to order. Would the member for Columbia River–Revelstoke please come to order.

R. Fleming: I just want to ask the minister, under subsection (a) here, the description of the purpose of this public education broadcaster…. I know that government has had two minds about how it has felt about the Knowledge Network. Of course, they made extensive efforts to privatize and sell off this important educational asset owned by the citizens of B.C., which has served us so well for well over two decades. That effort failed.

I think government has finally realized, after six years in office, that in fact the Knowledge Network has incredible value to British Columbians. I know they tried to change its financial aspects from an appropriation to a revenue-generating style of commercial broadcaster at one point in time. That failed to interest so-called private partners.

Now that the government has sort of accepted or gone back to the original intent and purpose and programming style of the Knowledge Network to carry on in the tradition with which it was started, I wonder whether in section 4(a) the minister considered adding to the description not only to provide unique, quality, educational programming to British Columbians but to specify that it would be commercial-free programming to British Columbians.

Hon. M. Coell: It would be a prerequisite to getting a CRTC licence that it be independent.

Bill 23, Knowledge Network Corporation Act, reported complete without amendment, read a third time and passed.

Hon. M. de Jong: Mr. Speaker, I call second reading debate on Bill 37, Legislative Assembly (Members' Remuneration and Pensions) Statutes Amendment Act.

LEGISLATIVE ASSEMBLY (MEMBERS'
REMUNERATION AND PENSIONS)
STATUTES AMENDMENT ACT, 2007

Hon. M. de Jong: Politicians' salaries, benefits and pensions — can we think of any other issue that poses as vexing a problem or is as fraught with political quicksand as those we are dealing with?

Who said that? Actually, I did, a year and a half ago, and here we are dealing with the same issues. I thought that I might just take a moment to remind the House of how it is we find ourselves debating Bill 37 today, to place that debate into some kind of context, and then I'll offer some briefly expanded views on the report and the provisions of the bill that derive from the report.

I think there is general agreement that the issue of pay and benefits was one that required addressing by the members of the assembly. At this point it is understood that since 1997, over the past ten years — with the exception of some minor adjustments that, it is my understanding, have fallen short of inflationary increases — there has not been a significant increase to the pay and benefits of the members of this assembly. It is also true that it was in the mid-'90s that the pension of the day disappeared and was replaced with a different scheme.

It was in that context, really, that some fairly extensive discussions took place starting in November 2005. It is important to restate now, as was stated then, that those discussions were embarked upon willingly by representatives of the government caucus and representatives of the opposition caucus with the support of their respective caucuses and leaders.

At that time an agreement was arrived at, and in addition to the re-establishment of a pension plan, that agreement provided for a pay package that included what has come to be characterized as a 15-percent raise in the base pay of MLAs.

It's also fair to say that there was a strong reaction in many quarters both to the substance of that recommendation and to the process by which those discussions took place and the recommendation was arrived at.

Again, I emphasize that it was very much a process freely embarked upon by the two parties represented in this chamber, sanctioned by the leaders — except in the case of the Leader of the Opposition, who subsequently had a change of position at, obviously, a determinative time. This gave rise to that package disappearing, again by vote in this chamber — a vote that most members here, if not all, participated in.

The issue at the time was very much, or it seemed to be, one of process. The call from various quarters — including, I might add, the Leader of the Opposition — was that we should have an independent panel, that there needed to be some distance between the members who would immediately benefit from any recommendations, any raise in pay or benefits, and the body that

was analyzing the whole issue. Despite the fact that that offer had been made earlier and rejected, the government ultimately took the view: "All right; let's do that."

One of the challenges associated with the debate that we had a year and a half ago and are having now, which politicians at all levels of government have whenever this issue arises, is that it is viewed as being an inherently self-serving exercise insofar as the benefits flow — if there are benefits — to those who are giving consideration to the bill or to the package contained within the bill.

In this case an independent commission was struck. What I think is important that this chamber recognize and acknowledge is that the decision to do so, which was made earlier — in February of this year — was accepted, supported and deemed the appropriate way to go.

I have all of the usual quotes of the day from the Leader of the Opposition and others who said: "No, this is the right thing to do. This is the way to go." The government said: "Fine. This body will address this issue, present recommendations to the Speaker by the end of April, and then the government will proceed — or not — on the strength of those recommendations."

It is important to acknowledge that the whole point of the exercise was to say: "Look, if we're going to have a process that is at arm's length from the politicians that presently inhabit this chamber, then it must stay that way."

It is hardly appropriate to commission a group to undertake the study and prepare the recommendations and then to embark on a subsequent exercise that says: "Well, let's replace portions of those recommendations again with our own views."

I have a difficult time understanding how one distinguishes that kind of process from the one that occurred a year and a half ago, which was roundly criticized. People like the Leader of the Opposition said: "No, that's not satisfactory. That's not the way this should occur."

I think it is important that members of the chamber understand that the government does place great stock in the fact that the recommendations that were handed down came from this independent body. The government is extremely hesitant and will not step into those recommendations and begin to tinker with them, begin to substitute our views, because…. Where does that end?

The irony is that that is the very exercise we undertook in 2005, and that wasn't satisfactory. That gave rise to a recommendation of around 15 percent. Apparently that was wrong. Apparently the process was wrong. If we believe what the Leader of the Opposition said, the number was wrong. So I'll be interested to know what the Leader of the Opposition has to say about this process and this number, and maybe she'll offer one of her own.

But I want to be fair with all members. The government does not intend to tinker, amend or substitute our views as government or our views collectively as a chamber for the views of the independent panel that has made these recommendations.

I think, in this moment that I have, it would be valid and important for me to point to the workings of the panel. When I said that its creation was viewed as positive and welcomed…. Of course, there's plenty of evidence in the media to support that proposition.

I think it's also important to recognize that members of this chamber, further lending credibility to that process, freely availed themselves of the opportunity to make submissions. They were apparently so comfortable with the exercise that according to the committee, 39 of us filled in an on-line survey; 44….

Hon. M. de Jong: You know, Mr. Speaker, believe it or not, I appreciate the fact that these are difficult discussions. I actually appreciate the fact that there are members in the House who may be very uncomfortable with the fact that a year and a half after apparently settling this matter, we are again having this discussion. That fault is not mine, nor is it this government's.

There were 44 of us, according to the committee — broadly proportionate to representation in this House — who went to the committee and made submissions. I think that's great. Apparently, they were comfortable enough with the process to feel entitled, obliged, to present their views on this issue to the panel.

Those were the words of the panel. Now, they don't assign those remarks to any individual member, but I suspect that they are broadly representative of the 44 members who made submissions to the panel, whether they were from the opposition side or the government side. They were cognizant of those submissions when they made their own recommendations.

I read those remarks because they are from the panel report, because I'm uncomfortable talking about the job in those terms. You know what? I love the job. I really do. I've loved it for 14 years, and I think I'm very, very lucky to be here. I'm very fortunate to have an opportunity to serve the public here in this chamber and in the various offices that we hold.

It is helpful for me to be able to draw on those words from the panel report because I think most of us in this chamber aren't looking for sympathy. We all made the decision to run of our own free will. I suppose one day if we decide that those feelings we have for the job and the enjoyment we derive from it disappear, we will decide not to run and to let someone else — as always is the case — take our place.

However, it is instructive to recognize the value that the independent members of this independent panel placed — and place — upon the work that members do in this chamber, do in their constituencies and do around the province.

There was another facet of the report that was interesting. I think all members have gone through the report. I don't know about other members, but I found the poll that the panel commissioned instructive. I'm not sure how surprised I was, but the fact that the poll was commissioned by an independent group…. They chose the questions to ask, and there was no opportunity, again, for anyone in a more self-serving way to manipulate the results. The findings were pretty interesting.

They asked some questions, and I picked a few of these just because I thought it would be appropriate to put them on the record during the course of this debate. "B.C. residents believe that MLAs work on average only 38 hours a week and 196 days out of the year…five days a week with 13 weeks off for holidays." That's an interesting finding from members of the public. It doesn't really describe my schedule, and I don't think it describes many schedules, but it does reflect the perception that people have of the work that MLAs do.

Apparently, from that survey, B.C. residents did not have an accurate idea of how much an MLA makes, with only 20 percent guessing within 10 percent of the real salary. The perceived average salary was $195,824. It's an odd figure when you consider that someone would choose that figure. It must be an average. In any event, over $195,000 was apparently the average of what people believe that MLAs make as an annual base salary.

The report commissioned found that over 90 percent of those surveyed believed that MLAs have a pension plan. Of course, that hasn't been the case, although there has been the RRSP contribution. But the pension plan that the public generally thinks about when they think of politicians has not existed since 1996.

I was here when that disappeared. I voted for it and, in retrospect, think I made a mistake. But it's interesting that ten years or 11 years on, virtually everyone asked in the survey believes that that pension or some derivative of it continues to exist.

Then lastly — not last on the survey but the one I pulled out of the survey — 86 percent of the people consulted said that the matter of determining pay and pension benefits for MLAs was best left up to an independent body. I think, again, very few of us would be shocked or surprised, particularly since we have all just lived through the experience of 2005 where that view was expressed with some vigour by members of the public, by the Leader of the Opposition and others.

Out of that exercise and out of those consultations emerges the report of April 2007, received at the end of April by the Speaker and tabled in this House the next day. I again want to share with members on both sides of the House — well, members on this side of the House know this — that the government did very much take the view that the integrity of the report needed to be preserved by not succumbing to the temptation of beginning to pick and choose, because it's always possible to do that.

Sometimes it's really politically convenient to do that. But where does that begin and where does that end? I dare say that if we went around the chamber, we could get 79 different views of how a report like this could be massaged or amended to better reflect individual views or individual circumstances.

It's kind of a mug's game. So there was a purposeful decision made, which says: "Let's abide by the recommendations if we are going to proceed" — and obviously, the government has decided to proceed — "and enshrine those recommendations in the legislation that is before the House today."

I apologize to members. Yesterday I took slightly more time than is customary to review some of the provisions, but I thought (a) members would be interested, and (b) they would likely receive questions in fairly short order. So at first reading I wanted to make sure everyone had some of the basic information. Those aspects of the bill are fairly straightforward, I would suggest.

I should say this to members. One of the advantages of the legislation before us, if it should pass, is that there will at last be a place that members and the public — perhaps more importantly the public — can go and actually see in one document what MLAs are paid and what their pension provisions are.

It's a bit haphazard right now, and part of that relates to the fact that there is a lingering jurisdiction left with the LAMC, the Legislative Assembly Management Committee, to set pay rates. We found out a year and a half ago how fraught with difficulty that can be. I would not want to leave the impression that it was due to the membership on LAMC because that discussion, obviously, came to a successful fruition.

This bill would remove the authority as it relates to compensation from the Legislative Assembly Management Committee and vests those pay provisions in legislation. To the extent that they — some government

or parliament — were at some subsequent time desiring to change that, they would have to bring the matter back to the full chamber for consideration.

That's not a shift that I spent a lot of time, or any time, talking about in first reading. But it is important to realize that part of the impact of this bill is to vest those pay provisions in legislation, which if changed would have to be changed by this body as a whole and not by LAMC.

The figure is set out in the bill as per the recommendation in the report — that each MLA receive basic compensation in the amount of $98,000. All in this chamber, I think, have read and seen the rationale for settling upon that figure — the comparison with other jurisdictions in Canada.

I have read enough of the commentary in the media over the past week or so from the Leader of the Opposition to know an initial position at least. My purpose here is not to try to present an argument that would convince her or others to embrace that figure.

The figure is what it is. It is the recommendation of the panel. Obviously the government is of the view that on that basis, it should form part of the bill and be the basic compensation going forward.

The bill also takes the recommendations as it relates to caucus officers — the Speaker, Deputy Speakers, cabinet ministers and leaders — and applies a different kind of formula. It ties what are described in this bill as salaries — they used to be called stipends; they are now called salaries — as a percentage of the basic pay, presumably precluding the need to revisit those amounts on any kind of ongoing basis.

It becomes the basic pay of an MLA that drives the entitlements for caucus officers, cabinet ministers and leaders. I think that's appropriate. I think that makes sense. We are, first of all, MLAs — all of us — whether we hold positions in our caucuses or in the executive council.

We are, first of all, MLAs. That is what entitles us to sit here. That should form the foundation, in my view and in the government's view, on what drives the pay.

The second part of this bill, about a 14-page bill, deals with the re-establishment of a defined benefit pension plan. I must confess that in the last year and a half, I have learned more about pension plans and calculations than I ever cared to know. But it is worth repeating what the panel has recommended with respect to this pension plan.

The formula is 3.5 percent. That's generally what is regarded or referred to as the accrual rate, and there's a variety of them. They range from slightly lower than that to significantly higher than that.

So 3.5 percent of a member's highest three-year average earning times the number of years of pensionable service — that's the formula. The panel made recommendations around when the pension should vest. It determined six years.

My recollection is that that is consistent, actually, with what existed up until the mid-'90s. It is, I think, consistent with what was recommended in the discussions we had a year and a half ago. So it is six years.

It also recommended — and the bill enshrines — that the maximum pension that may be received by a member is 70 percent of the highest three-year average. So based on the accrual rate — and I think I said this yesterday — that means in order for a member to qualify for the full entitlement under this proposed pension scheme, they must serve 20 years. In a normal profession, that may not seem a lot. No one in this chamber can boast that. No one in this chamber today has served 20 years. In the time that I've been here, I have known….

Hon. M. de Jong: Well, the member from Comox may look like he's served 20 years.

I've known two, and I'm not suggesting this is an exhaustive list. I was here when Emery Barnes was here. I think he served 24 years, if I'm not mistaken, and Colin Gabelmann was either 20 or 24. I can't recall. Those are the two I can think of. The average life span for a member in this chamber is much less than 20 years. In calculating what one's entitlements would be, I think it is reasonable to take that into account.

The last point about the formula and how the entitlement is calculated, which I think bears emphasizing at the outset of this debate, is one of the areas that over the past years has been one of the greatest bones of contention. That is, at what point can a past member begin to collect that pension?

When people talk about gold-platedness, it seems to me that one of the aspects of these political pensions that they frequently focus in on is the formula that says a member is entitled, after vesting, to a pension when the combination of age and service equals a certain amount.

What that has led to in the past are situations in which some relatively young individuals are collecting some relatively lucrative pension entitlements for many, many years prior to what any reasonable person would think are their retirement years. The notion of someone at age 48 beginning to collect a significant pension in the years in advance of turning 60 or 65 has, I think, led many people in the past to criticize some of these pension schemes.

In this case the panel and the bill confront that issue head-on and say: "Well, we have heard that criticism. We understand it. In order to qualify for full benefits under this pension scheme" — whatever they are, depending on number of years of service and average pay — "you have to be 65."

This notion of entitlements starting earlier than that, based on years of service…. They don't diminish the value of the years of service, but they say and the bill says that in order to qualify for the full pension, you've got to be 65. They do allow for a reduced pension to be paid under this scheme starting at age 60, and there's a formula for calculating the diminished amount depending on what year between ages 60 and 65 a former member would start to take the entitlement. So there's the pension.

I would suggest and — obviously by virtue of the bill being here — the government's view is that that is a

reasonable approach and one that is defensible and one that will withstand scrutiny certainly in comparison to other versions of this. I think it's fair to say that the panel also took into account the inherent risk associated with choosing even a partial career in public life in this chamber.

The last part that I thought would be important to revisit in this slightly more prolonged debate at second reading relates to the buyback option. The panel made specific recommendations around the question of buyback. First of all, it embraced the notion that members with former service should have the option to purchase pension coverage for those years. They didn't have to do that. They may have received submissions on that or come to that conclusion on their own, but they did form that conclusion and include two specific recommendations around that point.

They talk about two periods. They talk about the period from 2005 to 2007. Most of this comes into effect April 1, 2007. They say that from the time everyone in this parliament was elected in 2005 until April of 2007, there will actually be a formula enunciated, and they talk about that. They talk about 50 percent of the cost of the pension benefit resulting from the purchase. That's in the recommendation; that's in the bill.

Members will have to calculate that. It's not cheap. It will require a significant investment on the part of members who decide to take advantage of those options.

There's a second period that they talk about, and that is the period prior to May 16, 2005, back to June of 1996, when the previous plan ceased to exist. The suggestion there was that they weren't going to set a rate of buyback, but that LAMC should turn their minds to that aspect. Members have already heard me talk about the fact that the bill removes from LAMC decision-making authority around the pay and the pay matter.

I should also say this upfront. With the decision having been made — and I'll talk about this in a moment — to include the option for members to opt out, the government was of the view that it was important that members know all the details relating to this, including the potential cost to members who had previous service, so they could do that calculation and have a clear sense of what those costs would be.

That brings me to the issue of cost, and I purposely tried to relate the numbers to members of the chamber in first reading yesterday. I am relying, I'll say candidly, on information provided by people who do these actuarial studies and who can cost these things out based on certain actuarial assumptions. I won't profess to have done these calculations myself, but I am relying on the information that has been provided and, I think, provided in good faith.

The annual incremental cost of the package that is included in this bill is estimated to be $8.3 million. That's a lot of money. I'm one of those people who think that a hundred bucks is still a lot of money. This is $8.3 million. Going forward, there is significant cost associated with implementing both the pension and pay provisions of this bill.

The one-time costs, which essentially relate to the buyback, are significantly higher than that. The estimate that we have been provided with calculates on the basis of all eligible individuals purchasing back all of the service that they would qualify to purchase back. The number that has been provided with respect to the cost of that is $42 million for the pension.

In the scenario I've just described, however, individuals would be contributing $8 million. I do think it is important that the point be made that we've seen calculations from various sources like the taxpayers federation about what the benefits will be. I was disappointed, and I think I said this publicly, that the federation did not make the point that in order to qualify for the kinds of benefits on this pension plan that are alluded to, members — some in this House — will have to expend hundreds of thousands of dollars to purchase back that additional service.

Those calculations are easily done — well, relatively easily done — on the basis of the material set out in the bill. For some members who have less time prior to 2005, it will obviously be a lesser amount. For some members it will be a sizeable amount. Who's to say to what extent they are able or financially able to effect that buyback? But there are the cost numbers for members as we know them.

The pension and pay package is deemed, as I said, to take effect by virtue of this bill on April 1, 2007, and, again by virtue of the bill, applies to all current and future members. It is mandatory coverage. There is, however, as I alluded to yesterday, an option for individuals who are presently members of this assembly. Current members who disagree with the panel recommendations, who don't want to be bound by the recommendations that the panel has made with respect to pay and pension that exist and that are placed in this bill, may opt out.

Let's just talk about that for a moment, think about that. On an issue that is very, very difficult for all members to grapple with, there are now two ways to articulate one's position. One is to vote, and that is very much the standard mechanism by which a Member of the Legislative Assembly says to his or her constituents: "This is what I believe with respect to this." One can be on the record and be accountable for that vote.

In this case — I'll say it again — the government considers this a free vote. I won't be coy or cute about that. I think there's very strong support within the government caucus for moving ahead with this, but it will be a free vote. I hope it's a free vote for all members.

Hon. M. de Jong: Apparently, there is something humorous about the notion of having a free vote, Mr. Speaker. I suspect that in the fullness of time, we will learn more about why that is so humorous.

There is that opportunity, hopefully freed from the constraints of party discipline. Members will have an opportunity to say: "This is how I feel. This is what I

believe is appropriate." But it goes further, because this is a unique piece of legislation. It is in the short term….

Members will have an opportunity on a unique bill, which does have immediate impacts on the individual circumstances of individual members, to give some credibility to the position they take on this bill. Because the government has introduced a bill, I think the majority of the government members are going to support it, and they will be accountable for that. We will be accountable.

We will have people ask us, criticize us or chastise us. There are people we see in the report who think politicians are grossly overpaid today. I can only imagine the kind of commentary we'll get from them in the aftermath of this debate and of this vote, but we will be accountable to them for that.

It seems, therefore, only fair and appropriate for those members who choose to record a vote against the provisions of this bill that they should be accountable. The public should have some confidence that that recorded negative vote is not merely an attempt to score political points, but a legitimate expression of a deeply held view and conviction. I respect that. I respect that on an issue like this there will be differing opinions and deeply held convictions.

So we include a provision in the bill that provides that very tangible, real opportunity to the Leader of the Opposition and her colleagues to say: "No, this is our view. We've recorded it in our vote. We believe so strongly in it that we are exercising the option provided for in the legislation to say no, thank you.'"

From the sounds of it, it will be the vast majority of the opposition, but I don't know that. We'll hear more in a moment, I guess. They will thereafter take advantage of that distinction, point it out to the public and say: "We did this, and those guys did that." That's fair; that's politics. That's what accountability is all about. That's why the provision is there.

I've also heard some of the commentary from the Leader of the Opposition. To the extent that I can follow the ever-changing positions, I believe that most recently she has suggested that there will be some attempt made by the opposition to change the bill or improve the bill, in her words. I don't know what that means. I just heard another word from another member. That may be the member who has been offering the Leader of the Opposition this profoundly effective advice that she's been receiving over the past number of weeks.

I hope the Leader of the Opposition knows this, because I don't want her to be surprised or to be left with the impression that somehow I haven't been forthcoming. The government believes it is the recommendations of the panel that deserve to be voted upon in this chamber, and it welcomes the opportunity for members to express their views on the recommendations of the panel report as contained within the legislation.

We are not interested in substituting our views or the Leader of the Opposition's views for the panel's recommendations. The member from the Okanagan, the member from Kingsway, the member from anywhere — all of them, I'm sure, have slightly different views on what might be the perfect compromise or the perfect pay and compensation package.

It is the recommendations flowing from the independent panel that the government intends, through this bill, to put to a vote in this chamber.

All of us are here because we value the opportunity to contribute to public life in B.C. I can say that despite frequent partisan differences, I have great respect for the work that all members do. I am acutely aware that this is a difficult matter for many members to grapple with, depending on their individual circumstances, depending on their views.

I wish we weren't here. I wish actually that the 15-percent wage increase that we had agreed upon in 2005 was a fact of life and that we were precluded from the need to do this. That is not the case. So here we are with a bill that the government commends to members of this chamber and hopes that they will consider carefully and express their views upon in the two ways available: by recording their vote in this chamber and by standing behind that vote by virtue of the options provided in the bill.

Hon. S. Hagen: Today in the precincts we are pleased to have Ms. Twin's grade 5 class from Royston Elementary in the beautiful Comox Valley. The students were in my office earlier today and asked me some very, very thoughtful questions.

Would the House please join me in welcoming Ms. Twin, her grade 5 class and the parent supervisors who are accompanying them.

M. Farnworth: I will rise to take my place in the debate on Bill 37. I've got a number of remarks and points that I wish to make, some in response to comments from my colleague across the way, the Opposition House Leader, and some comments and issues that I think need to be raised and that have not been addressed.

I also recognize that the hour being such that it is, I couldn't possibly fit all that I have to say into the very short time we have before noon. At this point I would reserve my right and adjourn debate.

Committee of Supply (Section A), having reported progress, was granted leave to sit again.

ESTIMATES: MINISTRY OF FORESTS
AND RANGE AND MINISTER
RESPONSIBLE FOR HOUSING
(continued)

Hon. R. Coleman: Before I start this morning, I want to introduce the staff that are with me today. First of all, to my right is Mary Freeman. Mary is the associate deputy minister. She also has the longest title of the Ministry of Forests and Range and Minister Responsible for Housing, office of housing and construction standards. The second person to my left is Shayne Ramsay. Shayne is the chief executive officer of B.C. Housing, and behind me is Ken Cameron, who is the chief executive officer of the Homeowner Protection Office.

Just to open up the housing estimates this morning, because I understand we're going to do housing all day today — for however long it takes anyway. Most people are successfully housed in the private housing market. We support them through the residential tenancy branch when it comes to them being a renter in the marketplace and the B.C. building code and the Homeowner Protection Office and other regulations with regards to quality of construction for those that do own.

For those who require help with affordable housing and those who are homeless, our housing strategy, Housing Matters B.C., provides a range of options. It's been only six months since we launched Housing Matters B.C., and it's already working.

Budget 2007 is meeting the challenge of affordable housing in a growing economy. The office of construction standards will have a $348 million budget and 124 FTEs this year. That budget is an increase of about $118 million and a staffing increase of 21 people over the previous year. It's almost triple what the budget was in 2001.

We have responsibility for 15 pieces of legislation, divided into four core business areas under the office of housing and construction standards. There is housing, building policy, safety policy and the residential tenancy branch.

On housing policy, we address the needs from the homeless to home ownership. We focus on individuals or households with special housing and support requirements. We do this in a coordinated approach with other ministries, particularly the Ministry of Employment and Income Assistance, and also to a degree with the Ministry of Health.

On the building policy side, we provide advice on building regulation and building safety. We administer the B.C. building and fire codes, and with regards to those, we are actually in a process of modernization, and also, we're looking at a green building code going forward.

On safety policy, we manage agreements under the Safety Standards Act that provide advice on technical safety in the built environment, including electrical, gas, elevators, and boilers and pressure vessels.

Under the Residential Tenancy Act, about 36 percent of our citizens in B.C. are in households that rent, so we promote positive relationships between landlords and tenants, we provide information on their rights and responsibilities, and we provide a range of dispute resolution services to help resolve conflicts.

Since 2001 the budget for affordable housing has nearly tripled — the highest housing budget in the history of government in the province of B.C. The Premier's Task Force on Homelessness, Mental Illness and Addictions has led to a provincial homelessness initiative in cooperation with a number of mayors across the province who are now partners in finding land and opportunities within their communities.

We have allocated 2,287 units under the program since 2004 — not just housing, but we're also targeting the cause of homelessness. The facilities that we are doing today will include support services for those with mental illness and drug and alcohol addictions. There is $80 million that was recently spent for a thousand units of affordable housing in Vancouver, Victoria and Burnaby. We purchased 15 buildings totalling 709 units and committed to the construction another 287 new units of affordable housing. That was basically done so we could have a stopgap as we try to do more on Vancouver city lands and other lands across the province and build on our ability to do some supportive housing for a specific tenant group.

We've provided $27 million over the next three years to increase the number of year-round emergency shelter beds by 300 to 1,300 beds. We've converted all our existing cold-wet weather beds to year-round beds. We're keeping shelters open in Nanaimo, Vancouver, Kamloops, Vernon and Abbotsford, to name a few.

We're spending $45 million over the next four years to convert up to 750 old social housing units to supportive housing for seniors and other people that are at risk. We will do this because we have the stock and it is time that we actually made an investment in the stock.

We will combine subsidized housing with support services for the aging and disabled residents in those particular projects. We will offer a range of services including meals, housekeeping and 24-hour medical support in addition to that.

We're also taking steps to improve housing for aboriginal people living off reserves with the Aboriginal Housing Management Association. We committed $51 million over two years to build approximately 200 housing units off reserve. The expressions of interest for those have been issued, and we will see them come in shortly.

We want to leave a legacy for the housing needs of the future generation by providing a $250 million endowment fund for innovative housing opportunities in British Columbia. That fund will provide somewhere in the area of $10 million–plus for us to be able to try and do some innovative things to set new trends and standards within housing.

Since 2001 the province is developing or has built more than 12,950 new assisted-living and supportive housing units. By the end of this year we expect to be supporting nearly 100,000 households through a variety of housing programs. We committed $40 million annually towards the rental assistance program. We increased the maximum income level from $20,000 to $28,000 to help families.

The Shelter Aid for Elderly Renters, which we also have, provides rent subsidies to more than 15,000 low- to moderate-income seniors. We've changed the standards with regards to SAFER so that the residency rate, which was set back in 1991, was changed. At one time it was ten years that you had to be a resident of this province to be eligible for SAFER. Today it is one year. And in 2005, for the first time in 15 years, we actually increased SAFER and changed it so that more people could be on it.

We're working with local government to amend regulations such as development cost charges, parking requirements that hinder development of affordable housing. As we've done that and we've started to get that message out, we've seen it have an impact on what we're able to do.

Last fall we went out, when we did Housing Matters, and put out a 450-unit call for supportive housing in the province. Because of the partnerships and the people that came to the table from municipalities across B.C., we were able to do 758.

We're working with UBCM and the private sector to develop new incentives. We need to encourage smaller lot sizes and more energy-efficient homes. We need more affordable homes that use less water and energy, and that is going to be part of the strategy of the building code as we go forward.

We also have a modernization strategy that we're working on. Throughout B.C. changes in technology, the skilled-trades shortage and increased liability exposure tell us that we need to have a strategy. This is one tool to respond. We're consulting extensively with local government with regards to this as well as with industry and consumers.

The discussions centre on more accountability from all parties in the building projects, better knowledge of codes and regulations and how to apply them, and more efficient and predictable regulatory processes including permitting and building inspections. We expect to announce recommendations on all of this later this year. Working with industry to support professional builders and individuals building their own homes, the modernization strategy will also address needed improvements to raise the bar for residential construction.

As construction booms, we also have a building code that we're looking at. We want a green building code in B.C. We want to minimize the impact on the environment as construction booms. Sustainability measures will be developed side by side with industry and local governments. We will complement existing regulations. More efficient use of energy, water, building materials and other resources during construction will result in less construction waste in our landfills.

In conclusion, hon. Chair, as we start debate, we're making great strides in housing. We're helping more people. We're building partnerships with local government and non-profit organizations. Together we're going to make a difference, and I'm very excited about the future of housing in British Columbia.

D. Thorne: I thank the minister for summarizing his ministry's point of view on what's happening, and I thank the staff for being here today and taking time out of their busy schedules to come and let the opposition ask some questions about housing matters in British Columbia.

I have here the summary of the service plan. I have the service plan here as well, but in the summary, looking at the four goals and the objectives under the goals, there isn't anything there that I could disagree with. I'm sure the minister and I agree on probably more than we disagree on. But there are definitely some areas where — they are probably philosophical differences — I would say, right off the top, that my beliefs are different from the beliefs of the minister and his ministry.

Going through the goals, just before I start with my questions and looking at the safety in the built environment, certainly, I have questions on homeowner protection, in particular consumer protection — and we will go there later today — and on housing and support services targeted to most in need. I do have questions, but there certainly is very little in those goals and objectives that I could disagree with. Those are definitely — the groups that you have targeted as priority groups — the most needy, the most vulnerable and the highest-priority groups.

However, I think there is another priority group that I feel the current housing strategy in British Columbia is failing. That is the regular low- to medium-income family, the family that can't afford to buy into the market and the family that used to be served by B.C. Housing and other non-profits throughout British Columbia through the Homes B.C. program, which this government cancelled after it came to power in 2001.

That's the biggest area, I think, where my view and the statistics that I can find differ…. Or at least I can say that I can't match up what the ministry says and what I see and hear from talking to different stakeholders and even in looking through the figures. There are so many figures, so many budgets and so many announcements, and I don't know if new announcements are the same announcements and reusing things. I get confused.

I hear that there are a thousand family units built or X number of family units built over the last so many years. I'm unable to pin that down. I don't think that asking questions today on the huge range of areas that are covered now under the Housing Ministry and B.C. Housing and HPO…. This ministry is much bigger, and it's a shared ministry with the minister. It amazes me why it wouldn't be a separate ministry on its own, because it certainly covers assisted living and all of these other areas now included in Housing.

The things that the Housing Ministry covers…. It's almost unbelievable to think that I have to go through these questions in one day. So I doubt very much if I'm going to feel any more comfortable or have what I think confirmed about family housing today, but I'm hoping that this will enlighten me in some of the other areas. I fully intend to sit down with whoever the pertinent person is after estimates and get to what I call the bottom of what's actually happening for families in British Columbia other than rent supplements.

That's the priority area that we're missing. I think that I don't need to say much about that. One only has to look at how the waiting list for families that B.C. Housing has is growing so quickly and so frighteningly huge.

Then going into goal 3. I guess that's a nice segue into it because I feel that families should be a priority group too. Here we're referring to low- and moderate-income households, which is what I'm referring to as family housing. Of course, I'm talking about putting shovels in the ground and actually building community assets, which would be housing.

I think it's one tool in the tool box. I've said this before in the House, that rent supplements for a certain segment of people who already have an apartment and are paying more than 30 percent and are struggling to put food on the table…. I think a rent supplement program can really help that small segment of people.

However, obviously we all know — everybody on both sides of the House — that we have a huge supply problem in British Columbia. Rental housing has not been built, it is not being built, and one doesn't need to be a rocket scientist to see why. If I were a developer, it would not be my first choice of a project to take on because of numerous reasons.

So we have a huge supply problem. It's really hard for a lot of families, which are struggling, to apply for rent supps when they don't already have adequate rental housing and they can't find any. One doesn't jibe with the other.

The objectives under goal 3: low-income households have access to affordable housing. Under the current strategy of the B.C. government, it's going to be very hard to meet that goal. I think that's why we have up to 15,000 people on a waiting list.

The second objective: local governments have access to information…. Being a local government person myself, I think that's an admirable goal. The ministry and the municipal governments are working hard to come together around those issues and to meet this objective. I think that in my own community of Coquitlam we just showed a successful effort and have given land to B.C. Housing on a lease and have now put out the tenders and accepted the YWCA.

One can only hope that the process with the government and B.C. Housing will be finalized and council can stick to its guns and pass that housing. There is an example of exactly what you want to do under 3.2, and I'm proud to be from that community. I think that together, we can meet that goal.

So 3.1, I guess, is where I mainly differ with the government on how we meet that goal. I don't think we're going to meet that goal in any meaningful way with the current strategy. That's where we really differ. I differ that families should be a priority group under 2.2. That ties right into 3.1 because those families are the low-income households that I'm talking about.

With that being said, I'm going to move into my questions. My first questions are just budget questions — just some clarification that I need. Looking at the so-called housing budget, which I think is a bit of a misnomer…. I think it was the income tax–cut budget. To call an income tax a donation or "money for housing" is a stretch, because it's not how everybody in the province would see it. However, I guess any tax cut is helpful, particularly to low-income households. They feel it the most.

I'm just going to start here with a question around the estimates that we have in front of us. I'm just wondering what kind of consultation the ministry does to come up with these estimates. Do they do consultations? Do they read reports? There have been lots of reports on housing to come out in the last year or so from the city of Vancouver and many non-profit organizations. They all have their own point of view, of course, and their suggestions, etc., for the ministry before they come out with their budget in February. I'm wondering: what reports did the ministry read, did B.C. Housing read, before they came out with their estimates? And whom did they consult with before they presented their figures to the Ministry of Finance for the budget?

Hon. R. Coleman: I'm going to clarify a couple of things for the member as we get started. First of all, it's the position of the ministry that there is one housing strategy in British Columbia and that's Housing Matters. They can do all the other studies they want to do in all the other communities they want to do them, and we'll look at how we can blend that into Housing Matters. But we're not going to go out and change our direction. We've set our direction.

Now we may have a philosophical difference on that direction, but I want to clarify a couple of things

for the member to start with. The waiting list at B.C. Housing is actually down year over year, so things are starting to work. I'll say that again. The waiting list is down year over year — all right? The waiting list has always been pretty large — right?

Go back into the 1990s. When we were building family social housing and when we haven't been, there has always been a big waiting list at B.C. Housing. The second thing is that in the last six months over 1,500 families are on rent assistance for an average of over $300 a month. If you tried to build 1,500 units in six months, you wouldn't be able to do it because you wouldn't be able to find the land, get it zoned and get it through these municipalities in a timely manner. And you would actually tie up $450 million of government capital.

If you look at Housing Matters and you look at the rent assistance program — which I hope the member opposite and all the members in the Legislature are promoting through their office — we have a budget that could handle 15,000 families. In actual fact, that would mean that to build that amount of housing, we would need in excess of $4.5 billion — even if you could conceivably build it.

There are issues in and around rental housing, and there are a couple of ones that I'm concerned about. We live by certain statistics on vacancies, but things that are not included in vacancies when we do statistics on them are basement suites.

In addition to that, some single-family houses are not put into the statistics, because they're not in a professional corporation. The other statistic that isn't available is how many rental units there are in a condominium project. So in actual fact, when we try to figure out what we have in the housing stock with regards to vacancy, it's virtually impossible.

I live in a condo in Victoria. I know there are about 100-plus units in the building. I know that they're all owned. I also know that about 25 percent of them are rented out. But those don't go into the statistics for rental availability in the city of Victoria.

As we go down those numbers, we will find those challenges. Then let me go back to the member's question. I just want to reiterate one more thing. I know that people integrated into communities with other people, living where they want, where they can have affordable rental, have better outcomes than people just, necessarily, in social housing. I know that.

I know that because I was in the business. I've been in the non-profit organizations and have seen the benefit of a mixed use in a project and how much better the outcomes of the tenants were in the long term. So I know that.

I also know that if we want to, basically, concentrate on those people that are the highest at risk in housing in B.C., what we need to be able to do is take care of those folks with systems of support, whether it be mental health and addictions…. I think the member is right. She did say she agreed with our target market on the first point, because those are the folks most at risk.

When we made the decision on the strategy, we made a conscious decision that we're not going to be in the business of building and cutting ribbons. We're going to actually be in the business of helping people. That's the decision we made. That decision led us to a rent assistance program that's integrated into communities and that anybody can apply for.

As we've come through that, we've increased the threshold of the income from $20,000 to $28,000. I've said consistently that we're going to get 15,000 people — families — in this program. So what we have to do as we promote it is adjust it and streamline our process. If we get more and more people in there, so much the better. I want it to be wildly successful, quite frankly, so I'm prepared to be more aggressive on the promotion of getting rent assistance out there.

There are two processes, and I think they're tied together. One is: where do you get to your housing strategy? I can tell the member that I was in her position as a critic from 1996 to 2001, so I had a fairly significant interest in the housing side of government and, also, in the marketplace.

As I came through that, there were reports that I read consistently over the years. Then I wrote my own report, at one time, as to what I thought might be a direction for housing, and it actually looks a lot like Housing Matters. There are some other things that have been added and adapted and changed over the years as we've come through that.

As we came through to this point, we started out the cycle towards this year's budget, in actual fact, in the fall of 2005, not the fall of 2006, simply because we had an interim budget after the election. I saw that as the first opportunity to enhance the budget for SAFER. I thought, really, we had seniors who hadn't had an increase or an opportunity of adjusting their rent by geography in B.C. for 15 years.

We also had this piece of SAFER that made it more difficult as we came through it for finding seniors that could actually go on the program if they hadn't lived in this province for ten years.

That was the first change — to make that change, to make that adaptation. We knew that we needed a year to basically work through Housing Matters, look at various reports, look at other jurisdictions in the world, whether it be London — who have great success with their outreach workers, and we knew that that was a program that could work — or jurisdictions like Portland that had some success with smaller units in their downtown.

We need to look at them in our cities as well — and that's why one project in Vancouver is going to be a project sort of like the beginning of a smaller unit — so that we can build affordability into the system for people.

We came through all that. Basically, as the member knows, there's a parliamentary committee that goes out around the province during the budget cycle process. They come back with recommendations. We start our budgeting. And quite frankly, you know, I was pretty encouraged by the fact that I was able to get a substantial

increase in the budget for things like supportive housing, shelters, outreach workers and, in addition to that, the money we got for the rental assistance program as we came through this cycle.

It's an evolution, actually — the budget. We will, as we come through this year, look at what has worked and what hasn't and what we think we want to enhance, and we'll take those forward to the Treasury Board budget process this fall.

I can tell the member that is…. How would I describe Treasury Board's relationship on budgeting? I think basically if you've ever tried to build a budget in government, it's an interesting exercise. You have to be on top of your numbers. You have to know where you want to go. And at the end of the day, you've got to be pretty good salespeople in order to sell people on the fact that they'll give you the money.

I think we've had a pretty good run on that. That's how our budget cycle was done. We went through. We looked at the past. We looked at where we were, where we wanted to go. We took it to the table, and quite frankly, in this particular budget cycle year, I had a lot of things on the table that I thought would be innovative to do in housing.

Frankly, I got them all. If you talk to your colleague from Nelson-Creston, he'll tell you that in most budget cycles, you seldom ever get it all. You always get pieces of your budget or somebody's push-back. But on the housing budget, I've got to say that I had tremendous leadership from the Ministry of Finance and Treasury Board on what they saw as the vision for what we're trying to accomplish and how the budget could work.

D. Thorne: I'm very pleased you got everything you wanted, Mr. Minister. I think that I couldn't disagree with any of the things, really, that you're doing. As I said before, I have lots of questions about the things that you're doing. But you know what our fundamental difference is.

Your comment around the outcomes being better for children — or people, I guess you said; I always think of children — growing up in non-market housing, I like to call it, as opposed to regular market rentals, I of course have to disagree with.

The outcomes that I know of after working in social services for the last 35 years…. I think that the non-profit housing is more stable. It's more long-term for families, and I think that this is the number one criterion for measuring outcomes.

All of the latest studies done by Hertzman, etc., I think will back up what I'm saying on this. Most if not all of the non-profit housing that I'm familiar with and that I know the manager of B.C. Housing is familiar with is mixed housing. It's family housing with seniors, disabled.

When you get into the categories, you also have three levels of housing. You have two levels of subsidy. You have shallow and deep subsidy, and you have also low end of market. So we already have very mixed communities when we're talking about what gets called social housing.

I think the minister and I are just going to have to agree to disagree on this particular thing. By the end of the day we may have to agree to disagree on other things, but starting out, I think we both know that we have a philosophical difference on how to provide that kind of family housing best, what works best for the communities themselves and what really does have better outcomes for families and children who need the help from all of us in government.

As far as the rent supps and the vacancy rate are concerned, I know from past experience that those particular kinds of units are not included when we do vacancy rates. However, I still think the number of people that are taking advantage of the rent supps program is extraordinarily low. I do agree that it's one tool that we should be using in the tool box.

I do believe that the ministry needs to change, somehow, its marketing. Perhaps putting big ads in the Vancouver Sun is not reaching the very people that need it. I doubt if those people have time to read the Vancouver Sun every day. A lot of them are working one, two or three jobs. They have children. They're single parents, etc. So perhaps there's a better way.

I know the idea has been floated around about sending out application forms through the B.C. Medical Plan, where we know how many families are eligible for rent supplements. We could send out thousands and thousands of applications through B.C. Medical. I know that further on I have a section on rent supps where I was going to talk about it, but I've done that one already.

I do believe there are better ways to market. I don't understand why the ministry is opening itself up to people saying that you really don't want the uptake to grow as big as you say. You're not marketing in a way that's reaching people, when you know you have a list already, through B.C. Medical, of all the families, or most, that would be eligible for these rent supplements.

Anyway, back to my questions, Mr. Minister. The B.C. Housing service plan…. Now, I'm getting into figures here, and I get confused myself, so I may have to keep referring back here. It's confusing because there is the ministry budget and service plan, then there is B.C. Housing, and then there is HPO. I'm only looking at B.C. Housing right now.

The B.C. Housing service plan says that it is only getting an increase from the province of $42 million, which is up from its contribution of $270 million in '06-07. I'm just looking at the list here. But the ministry service plan for '07-08 says in the resource summary table that the '06-07 estimates were $222.6 million. So I'm just wondering: how did B.C. Housing get $277 million when the ministry's budget was less than $223 million? Did that come from other ministries, and if so, which ministries?

D. Thorne: What page am I on? I've got the summary financial outlook for B.C. Housing, page 34. And then, of course, the ministry….

Page 34, summary financial outlook for B.C. Housing, and the resource summary on page…. Well, it's just the summary. You know where it is — right? It's the big one in the service plan.

Hon. R. Coleman: On the rental assistance program, I thought that if we could do $250 a month in the first year, we would be doing well. I actually thought that because I think you've got to build momentum into a program. You also have to build other momentum into it.

We're not spending money on big ads necessarily in the Vancouver Sun and Province. We do spend money on ads in community newspapers. We do know that we have a higher readership within those newspapers. We are doing bus shelter advertising. We have written everybody on the B.C. Housing waiting list and sent them an application now. The MSP suggestion the member made — we are trying to do that. We're trying to get through that, though, because there are some FOI issues and issues with regards to what we can or can't send in the mail.

We think we're just about there, and if we get there, we'll do the MSP side. We will send it out to everybody who is in that income bracket with regards to MSP. So they would be approached as well.

With regards to the budget, the budget is actually, in '06-07…. Basically, what it is, is that we do a transfer of $320 million in '07-08. It will go to B.C. Housing. About eight million other dollars will come from other ministries to us. That would be mainly the group home side, where we get money from the various ministries that have group homes. We manage those on their behalf, so they fund over to us to do that.

Throughout the year there has been an increase in some of the money. In '06-07 there was money that came throughout the year that was increased, because we had different programs come through, like aboriginal housing and some other things. That budget actually went up year over year, but that was because we had some money.

I should make sure the member also understands that the $339 million does not include the money that we're talking about here, which is basically $328 million. It does not include the additional money that we received at the end of the year to buy the SROs, which was additional year-end money given to us straight up. We are absorbing the operating costs of those on the renovation side, but we're not….

We're not, evidently, going to be here very much longer, because we're going to go vote. So we'll continue this when we get back.

Hon. R. Coleman: I'll reiterate it — because we were interrupted by the bells — to the member, just so that she doesn't misunderstand my comments on social housing.

When I say "better outcomes," I'm not talking about smaller units that may have mixed income, mixed projects. That is not the type of project I'm talking about. I'm talking about when governments for years built large, massive projects, as they did in major cities across North America. We didn't actually make as big a mistake on that as other jurisdictions did. They had terrible outcomes.

The housing budget for '07-08 is $339 million. B.C. Housing shares $320 million, other ministries send $9 million, and the total share at B.C. Housing for the B.C. Housing budget is $329 million.

D. Thorne: I also asked about the resource summary table, where it says $222 million for '06-07. How did B.C. Housing get $277 million in the B.C. Housing budget? Was that from other ministries? Where did that come from? That was the last part of the question that I asked.

Hon. R. Coleman: That's midyear adjustments, basically. It's the money that came in partway through the year for RAP, the rental assistance program. It came in after the budget cycle was done, in the middle of the year, and then the year-end money would have gone into things like other purchases and what have you.

What we do, at the end of the year, is…. The reason it goes up to $277 million is that we have to reflect the total amount of money that came through the books.

D. Thorne: I'm just a tad confused. These two — this summary and the budget sheets at B.C. Housing — are not done at the same time?

D. Thorne: They can't be; that's right. They can't be because if that's the case…. They can't be.

I just also wanted to say that I'm glad the minister recognizes that we did not make those kinds of mistakes in our social housing program here in British Columbia and that we did have not only mixed use but mixed income, which makes the difference. Certainly, I hope that as we start redeveloping those social housing sites, we keep those philosophical factors in mind.

Hon. R. Coleman: Let me try to clarify this for the member. First there is the budget. At the beginning of the year we get a budget for $220-odd million. As we came through the year, we got more money in this case

That additional money came in. It gets reflected into the service plan, which is done in January. Now we're three-quarters of the way through the year, and we have to reflect what the actual money is in the service plan for that particular operating year. In fact, when the financials come out at the end of the year, the member is going to find that number is even higher yet because at the actual end of the year you will find that the amount of money that was given to housing was, year over year, even more than is reflected in the service plan.

It has to be different — I wasn't being glib when I said that — because the budget got a lift. We get a budget, and we get a lift halfway through the year. Then when we do our service plan, we have to reflect what that lift is, going forward. So we can't just say the $200-some-odd million at the beginning of the year in '06-07 was the actual number we spent, because Finance — through different presentations from the ministry through the balance of the year — decided to give more money to the Housing budget.

D. Thorne: Now I'm even more confused because you're saying that the budget gets done first, and then what I'm calling the resource summary, on page 76 in the service plan, gets done later, towards the end of the year. But the budget amount that is showing here is not the actual. It's the budget amount, and it's more than what got done later, apparently, because what got done later was $222 million. What was in the budget originally — six months or a year earlier — is $277 million.

That's what I don't understand. If it was the other way around…. When I ran agencies, I did budgets all the time, and I know about all of this stuff. But that seems reversed to me when…. That budget amount would have come out before February '06, and it's more than what you're saying came out toward the end of the budget cycle in January '07. That's what it sounds like to me.

You know, we don't have to do this now. We could have this conversation later because I don't want to spend all my estimates time nitpicking over a few million dollars.

Hon. R. Coleman: Somebody's reading something wrong here, and it may be the member, so let me try and go back. We have a resource summary table in the service plan for the ministry, which was published last year — right? That resource summary table shows you the $222.594 million figure, and $201 million of that goes to B.C. Housing. The rest of it stays in the ministry for other operations. We actually added another $115 million to the budget throughout the year as we did with other programs.

Reflected in January in the summary financial outlook, it would have been the higher figure, which is in the service plan going forward into the next fiscal year. Then when you see the financial statements, you'll see that the number that's in that fiscal plan will be higher. There will be more money spent, actually invested, than as even reflected in that particular service plan.

I think the member may have the two service plans reversed, but this is my understanding. Our estimates in '06-07, when our service plan would have come out, for lack of a better description, during the budget cycle in '05 or early '06…. That showed the $222 million. Throughout the year, then, we had an increase in stuff. We had a service plan summary financial outlook prepared, on page 24 of the service plan this year, which shows a higher figure being invested in housing. It's just what I said. Maybe I shouldn't have told the member, to confuse her on the next level, that it's even higher when you see the financial statements.

It's actually a very good story. It's a good-news story from the minister's perspective. I started out with a $222 million projected budget going into last year's fiscal year and throughout the year received another $115 million that was allowed to be invested.

It wasn't all reflected as we prepared the service plan this year because we didn't know that we were going to get the other $45 million or $50 million to buy the SROs until after the service plan and the budget had been put to bed. We got some year-end money that allowed to us go try to do something different, but that will be reflected in the financial statements when they come out in the public accounts in June.

D. Thorne: Okay, that makes it clearer for me. Knowing that these estimates and the resource summary are done the prior year makes the difference — I was not aware of that — when it says '06-07. Actually, then, the '07-08 forecast will reflect all of those extra dollars. All right.

The ministry's budget for this year. Right now it's showing as $339 million in the resource summary, and B.C. Housing is getting $319 million from that. So the other $20 million is going into the housing and construction office?

I'm just wondering where the other $20 million is going and, also, why the amount is going down. In the forecast for '09-10 it's only $300 million. Why is it so much lower than the two previous…? Two questions there.

Hon. R. Coleman: There are two questions there for the member. I'll do the first one first. The balance of the money stays in the housing and construction standards branch and takes care of things like residential tenancy, Homeowner Protection Office, building standards branch, those types of other operations that are contained within the ministry, outside of B.C. Housing.

I want to try and do this so the member isn't confused. There are really two budgets at B.C. Housing within a budget. On one side we have an operational side, which is where we pay the mortgages, pay the

overheads and that sort of stuff. We collect the rents that offset against each other and all that sort of thing. Over time sometimes our costs come down because of interest rates, or they come down because of people paying us a higher rent or whatever. So that's the operational side.

Reflected in this budget there is about $50 million in '07-08 and another $50 million in '08-09 which are capital grants that we're giving for projects. That money doesn't get spent every year because it's not operating money. As we go into the budget cycle in '07-08, we will identify what capital we think we might need in '09-10 forward and include that in our budget cycle. But we don't include it in those projections because we haven't identified projects where opportunities that we think are going to be there necessarily are at that particular time.

D. Thorne: Okay, that makes sense. It's too soon to project out that far. I still am not quite clear why that $20 million that's included under housing in the $339 million, if it's for building safety, residential tenancy, isn't put under those lines in the budget rather than mixed in with housing. That's very confusing to anybody looking at it. Wouldn't it be cleaner to put it in the proper lines right away?

Hon. R. Coleman: That's the vote. The housing vote is $300-and-some-odd million. It's no different than in forestry, for instance, where I have a whole different number of operations within forestry, but I have one global vote.

We break it out from there into what you'll see in service plans and what have you. The vote is the amount in the blue book, so that's how we put it in. Then, obviously, through estimates debate and also through service plans, we identify where it goes. A portion of it goes into one piece of the operation and the other goes to B.C. Housing, which obviously gets the lion's share of the money, and they operate that on behalf of government.

D. Thorne: I absolutely understand how you do budgets and how you do the voting, but I still don't understand why that $20 million is in the housing line and, if it's for the RTB or safety and building, why it's not in those lines. I'm not talking about the total of $347.845 million; I'm talking about the $339.143 million, which includes $20 million that the minister said was for the three line items underneath that.

I'm wondering why the budget is done that way. I guess that's really my question because it's very confusing. Anybody looking at this would think that the $339 million is being spent on housing and that $665 million is being spent on residential tenancy and so on.

Hon. R. Coleman: The vote provides for the operations described in the vote at appropriations under the following four core business areas, which I outlined in my summary: housing, building policy, safety and research, and residential tenancy. The subvote basically provides for the housing policy development program delivery, including transfers to B.C. Housing, which is the approximately $320 million for development of affordable housing, for the purpose of administering the programs, including Shelter Aid for Elderly Renters, the RAP program, etc.

Transfers are also made to ministries, organizations, agencies and individuals for housing research. Recoveries received from other levels of government, like other ministries, agencies, organizations and individuals, for service provided within the subvote…. The subvote on the building policy side provides for building policy development, for the administration of the building fire codes, building code and the administration of the Building Code Appeal Board under the Local Government Act.

Safety policy — we do that as a subvote for policy analysis and advice respecting the safety regulatory authority framework for the building environment and for the administration of the Home Owner Protection Act, Safety Standards Act and the Safety Authority Act. The statutory appropriation provides for the housing endowment fund, which is another $10 million of that.

From my experience in government, we don't break it down at every little individual category. If the member wants the breakdown, we're happy to get it to her. But basically we have $300-some million that goes over to B.C. Housing. The other stuff stays with us — within the housing policy branch and operational branches run by the assistant deputy minister, who then runs the budgets of the individual categories like RTO, HPO and those particular organizations.

We just don't break it out in any more detail on that level of reporting, but we can certainly do it for the member.

D. Thorne: Then I guess I would like to know. I would like to know because my original question was: where is the other $20 million that is in the budget under housing, that doesn't go to B.C. Housing? Where does it go? That's what I would like to know, so I'll take the minister up on his offer to provide that information to me at a later date. I'm quite happy to do that and move on.

Hon. R. Coleman: I'll tell you where it goes. I described that already: the building standards branch, the HPO, the residential…. You just want to now have the breakdown by category of how much goes to each one. That's what I would understand, and we're happy to get that for the member.

D. Thorne: Well, the way you phrase it…. That isn't exactly what I want because I don't care what amount goes to residential tenancy, safety policy or building policy. Those amounts are down in the budget, and I have no reason to question them. What I'm asking is why $20 million that's under housing does not go to B.C. Housing. Why is that $20 million, if indeed it goes to building safety and residential tenancy, not in the budget as going to those in the first place? That's what my question is. That's what I want to know.

Hon. R. Coleman: The breakdown I will provide the member will include the fact that we have an office to run for the ministry. The ministry has staff that will do all kinds of policy work with regards to the stuff that actually makes Housing work.

The reason it doesn't go to B.C. Housing is that it's the Minister Responsible for Housing. The Minister Responsible for Housing is B.C. Housing plus a whole plethora of other things relative to the housing market in British Columbia.

Those people have to be paid, and they have to work. They have work to do — right? It doesn't matter whether it's building standards or RTO or whatever. The deputy minister has to manage that operation and does so in coordination with the relationship of B.C. Housing. The $20 million is spent on those portions of the operation. So we'll just sum it up for the member and give it to her.

D. Thorne: That will be just fine because I'm not questioning the expenditure itself. I just want to know where it goes. I would have expected it all to go to B.C. Housing, but I didn't realize there were that many expenses outside of B.C. Housing in order to run housing. I'll be happy to get that information. Thanks to the minister.

I'm going to move on now to one of the budget items, since we're in the budget area, which was the conversion of 750 units of social to supportive housing. I'm wondering when those conversions are going to start. I'm also wondering if any of those conversions are units included in the recent purchase — the money that the minister was referring to a few minutes ago, the $45 million or whatever it was.

I'm wondering if any of those 750 units that were announced in the budget are part of that purchase, and when the conversions are going to start. If they've started, when did they start?

Hon. R. Coleman: Well, it's already started. It's $45 million over three years for 750 units to get them home support–ready. We're taking units and making them home support–ready or able to be supportive housing, oftentimes tied in where there is already long-term care and other assisted living already on the site.

D. Thorne: My question is: where in the budget is the $45 million to convert the units? But it's not in the budget — right? I think the minister said that the money to convert the units came in later, after the budget was done. So my question then is: where in the budget is that, and is it going through B.C. Housing?

Hon. R. Coleman: It's in the provincial share of B.C. Housing's budget for the next three years. It's in the budget. It's in the money that we send to B.C. Housing. It's managed by B.C. Housing to accomplish the goal of achieving the 750 units of home support–ready.

B.C. Housing is a delivery of the services on behalf of government from a number of aspects of housing. Just going back to the other $20 million discussion for a second, they don't operate the rest of stuff in housing. That's why there is money elsewhere in the ministry to operate the other stuff in housing.

The work has already started on a number of projects. We've been identifying the projects. There is one — for instance, the Evergreen Baptist project in White Rock — which is a project that has long-term care and assisted living already on its site. It's now taking some older units, and we're renovating those so they will be home support–ready and be able to share in the services on the site for people to age in place. That's the objective of that portion of that particular project as an example. The 750 units will be completed over that three-year cycle.

D. Thorne: Okay. I did have some specific questions that I wanted to ask on the conversions and on the people who are currently living in the social housing units that are going to be converted. I wanted to tie into that, as well, the buildings that were recently purchased in Burnaby at Alpha and Beta.

As the minister knows, the people who are currently living in those houses…. I've been down there and toured those buildings. It is not a B.C. Housing building yet. It may be by now, but it wasn't when I was there. We would call it certainly low-income housing. The people who are living in those units have many, many concerns. They're actually very fearful. I have some questions about the future of those units.

Also, just to comment about the way that the people who live in those buildings found out that the buildings were being bought and how they found out that they would be eventually converted to supported housing.

My first question is: who is going to manage the buildings? They have had several different answers. B.C. Housing has told some people that they're looking for a non-profit to run the buildings. Some people have been told that the current managers or new managers — I think the current managers are gone — would be coming in to stay in place and were wondering about that.

Hon. R. Coleman: Let me deal with this first of all. The tenants in this project have been written to twice. They've had a barbecue. They haven't had a whole bunch of different answers. They've only been told straight up by B.C. Housing. If the people in politics in Burnaby weren't so irresponsible with what they wanted to inflame the neighbourhood over, these people would be fine.

The fact of the matter is that nobody is leaving the residence. It's staying as family housing. It was bought because somebody put it up for sale. If we hadn't bought it, somebody would have torn it down, and those people would have been out of a home. We bought it to preserve some affordable rental in a community.

The mayor of that particular community decided to make it a cause célèbre of his, to inflame and scare an entire community, including the tenants in that community,

and was completely irresponsible. Completely irresponsible. Never took the time to discuss it with B.C. Housing. Never took the time to have a discussion with regards to it but scared those tenants irresponsibly. Other people have done the same.

They've all had a written communication from B.C. Housing, which frankly they probably wouldn't have got if some other corporation had bought those units. They wouldn't have had a community barbecue to explain the fact that the property manager is staying in place and that we're going to find a non-profit manager for the operation. They wouldn't have got that communication.

In actual fact, I don't take it that we did a poor job of communicating with these tenants. I do take it, though, that a bunch of people in a community were irresponsible in scaring people unnecessarily.

It was bought as part of a package, and because the other package was bought, everybody decided to draw the parallel over to these units as going to supportive housing. The next thing you knew, there were people in council in that community saying: "We're going to have drug- and alcohol-addicted people living in this project."

In actual fact, we bought them to preserve some rental stock, and we told the tenants that. That was a very unfortunate situation that came about because people didn't take the time — in public life, in public office — to ask the question. That's where the falldown was, in my opinion.

Now, as far as the tenants are concerned, they can rest assured. We've written them and told them: "You're not going anywhere. Your residence is there. It's been protected as affordable rental stock in the community, long term. You will have a property manager, short term, until such time as we can go out and find a non-profit manager. We'll continue to hold that stock as rental stock for families in British Columbia."

D. Thorne: Well, I might just comment to the minister that two of his government's MLAs made quite different comments in the newspapers, and in person too. I will quote: "The target is to accommodate homeless people, specifically with mental illness and addiction issues, with very strong support services." That was one MLA — I think the Burnaby North MLA.

The Burnaby-Willingdon MLA distributed a letter at a public meeting held to deal with the issue — it might be the barbecue that the minister is referring to — stating that the province was thinking about using the homes to house women fleeing domestic violence. That letter was also published in the local papers.

So I think the minister may be right that it's Burnaby politicians that are causing a lot of the problems for the residents. But I'll put this into the record: it is the government's politicians for sure that have been most publicly upsetting the residents.

I'll go back to my original question, if I might, which was: who is going to be managing the buildings? B.C. Housing…. They have been told the current managers, who have since left. So I'm assuming that B.C. Housing will be hiring a manager, but I'd like to know if that in fact is true. The other question that goes with that is: who will be picking the new tenants as tenants leave these buildings? And who will be making the decisions about what kind of tenants are going in there?

I understand the minister is now saying that they will not be one of your target groups — the hard-to-house or supported housing. They will be low-income families and not needing extra support services. This is not just for now. My question is: is this into the future? Is there some surety there for the current tenants of this building who are living with these questions?

Hon. R. Coleman: First of all, the managers have not left. They're there. Secondly, I did say to the member…. Maybe you could listen this time. I said the manager is staying until we can find a non-profit operator to operate the building. That is pretty clear — right? That's pretty clear.

Now, the one correspondence from one of our members with regards to someone fleeing domestic violence…. Are you telling me, Member, that that is not a target group for social housing? That if a woman is fleeing abuse — domestic violence — with her children, she is not eligible to go into a low-income rental unit in Burnaby? That we actually wouldn't give those people supports?

Obviously, there is a client group in any portion of our affordable housing or social housing we have that may need supports from time to time. The description that was being given, on the one side, frankly, was incorrect, but on the other side…. The description about somebody that might be fleeing domestic abuse…. If we had a vacant unit in that project and we could house them and protect those children and that family, we might do that if a unit was available.

As we go through, the people that will get housed there will be…. Obviously, if we give it over to a non-profit organization to manage the project, they will be the ones that will select the tenants. They will manage it.

They're not going to evict anybody unless…. Obviously, they could evict somebody for the reasons on a residential tenancy, where they break the rules with regards to the operation of a facility, like any other tenant, but they're not going to go in and evict because they're going to put a different client group in there. That's the reality of this thing.

I find it interesting. I guess we probably should have thought about it, because this has been one community that really hasn't been that cooperative on any of the housing projects that we've done in British Columbia.

They're a community that says they want something, but every time they do, they put up barriers against it. So rather than celebrate the fact that we protected some affordable rental stock for families and their community, they want to decide to turn it into some kind of an issue.

Now, there may have been some communication, and I won't disagree, with regards to what the member read with the press reports. Those were unfortunate, I agree, but the fact of the matter is that as quickly as possible, as soon as we had control of the title and knew that we had the project, we made full communication and disclosure to the people. The public meeting that the member is talking about had nothing to do with the barbecue. We dealt directly with our tenants and with B.C. Housing staff at a barbecue one on one.

D. Thorne: Well, I didn't say, I don't think…. I certainly didn't mean to say that any of these client groups shouldn't be housed in these buildings. All I'm doing is quoting what government MLAs have said publicly and to the residents of these buildings. I didn't pass judgment on whether I thought the comments of these MLAs were correct, incorrect, wonderful or bad. So I want to assure the minister that, were I in charge of picking the tenants, I would have my own views on who would go in there, and they may be different or the same as the MLAs who made these comments.

When you say a non-profit is going to be running it, I assume then that means B.C. Housing is not — that it'll be a non-profit. That was what I was asking. Was B.C. Housing going to be involved? Who will be picking the tenants? Will they be coming through B.C. Housing or not? Will some of the units…? Over the years, then, is the plan for some of them to become subsidized and/or supported units? If so, do you have any idea at this point in time if you are going for 100-percent conversion over the next 20 years, or to subsidized units of one kind or another?

Hon. R. Coleman: I'm going to try this again — okay? I said that the property managers stay in place until we find a non-profit group to operate the units. B.C. Housing is not a non-profit group. So it could be the YWCA, it could be a service club, or it could be a fraternal organization. As I said, we will do an expression of interest to see who wants to come in and make a proposal to us to operate this particular number of units. They'll make that.

The intent is that over the life of the project, when a unit becomes vacant, we will convert that unit to somebody who would have rent geared to income. So 30 percent of their income would be for rent. The way they will get selected is…. We manage a registry of people who are waiting for housing, in cooperation with a number of non-profits, and we'll work from their list and our list to find a person with the most applicable need to go into a particular unit. That's how we manage housing today, and that's how we'll continue to manage these units in the future.

D. Thorne: I'm just wondering how much of the money that's allotted to convert the 750 units will go into, for instance, Burnaby. Will it go into upgrading physical structures? Is turning them into supported housing the goal — to turn them all into supported housing — or a percentage over the years? That's what I'm wondering.

Hon. R. Coleman: First of all, this purchase, all of the purchase, has nothing to do with the 750 units. They're a separate project completely.

Now, there may be in Burnaby some older seniors apartments that are either run by a society or owned by B.C. Housing and that we determine are some of the units we might want to change to home support–ready. We go in and we put in the lever-handle doors, lever-handle taps and a different type of shower so it's more accessible to the disabled — and put supports in the building, like putting some amenity space where there can be meals and that sort of stuff and certain types of care going forward.

I can't tell you there is a particular building in Burnaby that's on that list today, because we're working through the 750. This was strictly a purchase of year-end money to protect some affordable stock of rental stock in a community. That's exactly what it is.

I will continue to say, so nobody is confused, that there could be a tenant actually living there today that has a mental health or an addiction problem and that might need additional supports as part of our tenant group, who we, as responsible managers of housing, would try and help with all our services in government.

There may be a tenant in the future that is…. It could be something as simple as I said earlier — escaping domestic abuse and also needs other supports from social services and could become a tenant in one of those two buildings. But it was about protecting the stock.

The people that live there can live there as long as they want. Nobody is going to be evicted as a result of making way for another type of tenant. This will be a housing project that could be in transition for many years.

D. Thorne: I don't want to give the impression that I don't think supportive housing is really important and necessary and that there's not a need for it. But, you know, my concern is that when we start converting low-income housing — whoever it's under, B.C. Housing or another non-profit or just the private marketplace like these units were…. And I'm using these units as just an example.

They exemplify other units across the province that I suspect will come under this kind of mandate in the future, which the minister just referred to with seniors housing. I don't want to see, and I'm afraid to see, that this kind of supportive, necessary housing will come at the expense of our regular social housing units. I would hate to see regular low-income families lose 750 units, this year alone, of regular social housing that have been put in.

The minister can huff and puff and look annoyed with me, but I'm just expressing my feelings. I would hate to see that happen. I'm going to make sure that it's very clear that I do not want to see that happen, that my caucus does not want to see that happen.

That's not the way we believe that we should get supported housing and assisted living. Senior assisted living is a different category of housing altogether and

must not come at the expense of family social housing. I want that to be very, very clear.

Just one more comment on the conversions, and these would be the buildings in the downtown east side and, I guess, in Victoria, the SROs. I mean, I think there isn't anybody who isn't pleased. As horrible as these buildings can be when they are not looked after — and most of them aren't, in the private marketplace — none of us would say we're not pleased that the government has stepped in and is going to make these healthier, safer places for people to live in.

However, let's be very clear that there are already people living in these units, and it is not new housing. But it is going to be protected housing. So it comes under a different category, in my mind — a good category.

We are going to get 287 new supportive housing units in Vancouver. And I'm assuming — I guess I should make it a question — that of the 750 units that were talked about in the budget, the 287 new supportive housing units are not included. So we're over a thousand units now with the 750 and with the 287 new units. We're over a thousand units of supported housing — right? But only 287 of the units are new housing that nobody is in right now.

So presumably, we'll get 287 homeless people off the street. Is that correct, or am I reading this incorrectly — that we're going to actually get more off the street?

Hon. R. Coleman: First of all, I have to make one correction. The member said 750 units of family housing might not be available for families in British Columbia. Completely wrong. The 750 units are seniors units. In many cases, there are people that need those supports today. They need a bar behind the thing, so we're going to convert them to be more home support–ready and get a better quality of life for our tenants.

This request, by the way, came from the non-profit housing sector as something we look at. That's on top of about 500 we've already done. We've been doing this. This is a transition. We've identified the capital to do it. Let's put that over there for a second.

Then she talks about the supportive housing units in Vancouver. We do know that there is a specific tenant group that are in SROs. We thought there was an opportunity to do something innovative, to put some supports. They're not in anybody else's numbers.

We've done 758 supportive housing units that we've approved in January from the proposal call last fall. We had 500-some-odd in addition to that, so there are about 1,300 units already in the system not counting the 200-some-odd in Vancouver and not counting the SROs and not counting any of the other purchases. That's all out there.

Don't get confused with the fact that we're going to help seniors in their home and build support in some of our housing stock with family housing. At the same time there are 70,000 units of housing in British Columbia under management in one way or another by B.C. Housing — either in relationships with non-profits or whatever. We have those all over the province.

We continue to adapt that housing so that they'll be supportive in the future for seniors, or in some cases we're challenging our non-profit partners to say: "Look, what if you have a couple of people with mental illness in your project? Will you take some additional training and some other supports so that you can help that clientele?" Because we want those people who are at risk of homelessness and are tougher to house in the private marketplace to have a place to live.

As we do that, we did a rental assistance program that takes care of people. So frankly, the confusion here is by definition. The confusion is that the member opposite wants to talk about 750 units of family housing going away because we're going to turn it into supportive housing when it's not even family housing to begin with. It's seniors housing, and we're trying to put a system of supports in and work towards a balance for these.

This is going to go on for a little while yet, I'm sure. So noting the time, I move that committee rise, report progress and seek leave to sit again.

D. Thorne: Can I request one more question for my colleague, because he is leaving at lunchtime on leave? It's just one question in this area.

Last April the government made a huge announcement about the affordable housing initiative. This $80 million announcement offered support to communities like Vancouver, Burnaby and Victoria. The city of Surrey, which is the fastest-growing municipality and also the second-largest city in the province, has a homeless population that has gone up 140 percent over the last few years. The city has 45 shelter beds, as compared to 550 in Vancouver.

There is an extreme shortage of shelter beds in the city of Surrey. Highland House, which provides shelter to homeless people, turned away over 4,000 people last year alone, and as per the latest report, that number is going to go up this year.

My question to the Minister for Housing. The city of Surrey has been ignored in this particular announcement. Why was this city not part of this particular initiative?

Hon. R. Coleman: First of all, there weren't any projects that we could find that were available for sale at the time that we had the capital, and that's why. I've actually told that to the members in Surrey.

I don't want the member to walk away from this thinking that we're not doing anything in Surrey. I don't know if the member was at the opening of the Phoenix Alcohol and Drug Recovery and Education Society 62 units recently, but there was a new project opened that was under the Premier's Task Force on Homelessness. We put more money into shelters so that your temporary shelters are now permanent, 365 days a year, in the city of Surrey.

We've sat down with the city and talked to them about where else they want to go. I've given them a list of the few thousand units in Surrey that are managed by different societies or funded through B.C. Housing — whether it be for seniors or family housing or even some of the drug and alcohol stuff.

We also have the Atira Women's Resource Society with 32 units, 11 units for Elizabeth Fry, 12 units to the Fraserside community resource society, and we have a proposal call that we've just put an expression of interest on for 35 additional units in Surrey that are going to get funded with capital to be a new build with regards to supportive housing as part of the task force initiative.

We're going to continue to work with Surrey, quite frankly, as the community…. I've spoken to the mayor and councillors that we're going to help them identify projects and properties and work with them. We'll be as active there as we are everywhere else.

J. Brar: This will be my last question. I appreciate the clarification from the minister.

Last February a proposal was made by Highland House for an extra shelter bed home. At that time, the government refused to make any commitment as far as the operating funding is concerned. My colleague, the critic for Housing, of course, at that time raised the question and asked the government to support that proposal.

At that time, a local member from the Liberal Party, who is the Minister of Transportation, made a statement. He said, "In fact, the NDP MLA and the critic will look silly when we make the next announcement," which was the housing announcement that was made. Even the Minister of Transportation, who is a local MLA from the city of Surrey, was very, very hopeful that Surrey would be included in that critical announcement.

I would like to ask the minister to clarify if there was any discussion between the Minister of Transportation and the minister about that issue. Also, when can we expect any initiative in Surrey when it comes to shelter beds?

Hon. R. Coleman: The member should understand that we take our land, other land and opportunities, we put out proposal calls, and we evaluate the proposal calls. Frankly, the options proposal call on the one piece of land, which was our land, was not very strong. So we went and looked at the investment to capital towards that project versus what we could do with the stronger proposals, and we chose to select the other proposals.

That project has not gone away. It's actually out for an expression of interest for non-profits to make a proposal to us with regards to a project that would have some supportive and some shelter in it. That is out there now. It will probably get started in construction this year as long as everybody gets their zoning stuff and everything done — and their public hearing stuff done.

On the other side of the thing, we've already formalized all your emergency cold-weather beds in Surrey, and we've made them available to have 365-day-a-year funding versus partial year funding. The projects I mentioned before are only the tip of the iceberg of what we do in Surrey.

When I started to explain to the members of council just how much B.C. Housing plays in their community, they were quite surprised. Oftentimes people take it up as a one-off project. We've got a project; that's great.

If you look at the overall number, which is well over 2,000 or 3,000 units across an entire city in certain types of housing, and then you mix them all together, it walks up into the thousands, and they're all funded by us. We just look for opportunities to partner with them to do more, and we're doing that.

Noting the hour, hon. Chair, I move the committee rise, report progress and seek leave to sit again.

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