Hansard — Thursday, March 13, 2008 p.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		10553

Tributes		10553
	Elgin Park Secondary School Orcas basketball team
	Hon. G. Hogg

Introduction and First Reading of Bills		10554
	Labour and Citizens' Services Statutes Amendment Act, 2008 (Bill 13)
	Hon. O. Ilich
	Small Business and Revenue Statutes Amendment Act, 2008 (Bill 11)
	Hon. R. Thorpe

Statements (Standing Order 25B)		10554
	Rotary Club of West Vancouver
	J. McIntyre
	Kidney health
	D. Cubberley
	Port Kells Community Association
	D. Hayer
	Ryan Street greenway project
	R. Fleming
	BID Group in Vanderhoof
	J. Rustad
	Farmworker safety
	C. Puchmayr

Oral Questions		10557
	Government response to actions of Ken Dobell
	C. James
	Hon. W. Oppal
	Hon. M. de Jong
	M. Farnworth
	B. Ralston
	Government response to actions of Ken Dobell and Jessica McDonald
	R. Fleming
	Hon. M. de Jong
	Government response to actions of Ken Dobell
	M. Karagianis
	Hon. M. de Jong
	J. Kwan

Petitions		10561
	L. Krog

Reports from Committees		10562
	Select Standing Committee on Finance and Government Services, first report
	B. Bennett

Petitions		10562
	Hon. C. Hansen

Committee of the Whole House		10562
	Musqueam Reconciliation, Settlement and Benefits Agreement Implementation Act (Bill 12) (continued)
	Hon. M. de Jong
	S. Fraser
	S. Simpson

Report and Third Reading of Bills		10570
	Musqueam Reconciliation, Settlement and Benefits Agreement Implementation Act (Bill 12)

Committee of the Whole House		10570
	Prevention of Cruelty to Animals Amendment Act, 2008 (Bill 9)
	S. Fraser
	Hon. P. Bell
	R. Sultan

Report and Third Reading of Bills		10577
	Prevention of Cruelty to Animals Amendment Act, 2008 (Bill 9)

Committee of the Whole House		10577
	Housing Statutes Amendment Act, 2008 (Bill 10)
	D. Thorne
	Hon. R. Coleman
	S. Simpson

Report and Third Reading of Bills		10584
	Housing Statutes Amendment Act, 2008 (Bill 10)

Committee of the Whole House		10584
	Electoral Reform Referendum 2009 Act (Bill 6) (continued)
	J. Horgan
	Hon. W. Oppal

Proceedings in the Douglas Fir Room

Committee of Supply		10588
	Estimates: Ministry of Labour and Citizens' Services (continued)
	B. Ralston
	Hon. O. Ilich
	Estimates: Ministry of Transportation (continued)
	Hon. K. Falcon
	M. Karagianis

Hon. C. Richmond: We have guests in the House today from the First Nations Human Resource and Labour Council who are conferencing in Victoria this week and who I had the pleasure of having lunch with, and some of them will be visiting in my office later.

First of all, there's Murray Ned, the Stó:lô Nation, human resource development; Harvey McLeod from the central interior partners of human resource development; and Karen Abramsen from the Okanagan human resource development.

D. Cubberley: Earlier this morning I made the House aware that today is World Kidney Day and that as part of our collective effort to raise awareness of kidney health, we've joined with the Kidney Foundation of Canada to host an event here at the Legislature. I want to thank the foundation's volunteers for their efforts to give voice to kidney health.

I also want to introduce a number of important people who have put their energies into making this happen today. Today in the gallery and in the precincts we're joined by Ken Merkley, who is president of the B.C. branch; Lorraine Gerard, the executive director; Mary Grebinsky, senior development officer; Maurine Hobbs, president of the Victoria local.

They are capably seconded by Sarah Peterson and Angela Robertson, who are nursing assistants and who were reading our blood pressure today, as well as our own nurse, Mailis Beazley. I would be remiss in not mentioning Sidney the Kidney, who also joined us for the event.

Will the House please join me in thanking them and make them feel welcome here today.

Hon. S. Bond: As members in the House would certainly know, this year is actually B.C.'s sesquicentennial, or 150th anniversary. Last night I was delighted to join the Minister of Tourism, Sport and the Arts at the Royal B.C. Museum to open an amazing exhibit that is called "Free Spirit." There are fabulous pictures and stories of British Columbians and British Columbia's history.

What was most personally exciting for me was that we have a number of northern representatives in a display that's called "The Party," and it's beautiful. It's actually life-size photographs of people who have contributed to the history of British Columbia.

I am delighted to say that one of the faces…. There are numbers from northern British Columbia, including Ben Ginter, Dr. Peter Newbury and Bob Harkins, who has a very special place in our hearts in Prince George.

But someone who is actually here in the gallery with us today, and whose face is also captured in the Royal B.C. Museum exhibit, is Dr. Charles Jago. He's accompanied by his wife Mary. I can tell you that not only are they great friends personally, but they are enormous contributors to northern British Columbia. At the University of Northern B.C., the Northern Sports Centre is named after Charles. He is a great northerner and a wonderful friend.

I urge you all to go and see "Free Spirit" and see how many of those faces and names you recognize. Please join me in welcoming them.

C. Wyse: Today I had the privilege of joining Kerry Ebuson from Kelowna for lunch, along with two other individuals, Jane Berry from Victoria and Lois Shannon, likewise from Victoria. I would like the House to join in making them feel welcome.

R. Lee: Joining us in the gallery today are 29 grade 6 students from Westridge Elementary School in Burnaby, accompanied by their teacher Ms. Janet Pritchard and also by the parents. They have come here to learn about the Legislature and how government works. Would the House please give them the warmest welcome.

J. McIntyre: I just wanted to mention that in the precincts today is Susie Gimse, who is a constituent of mine. She is electoral area C representative on the Squamish-Lillooet regional district and also this year's president of UBCM. I had the pleasure of having lunch with her today, and I'd just like the House to make her feel welcome.

K. Whittred: Just a few minutes ago I had the pleasure of meeting a number of students from Bodwell School in my community. These were high school students here, of course, to learn about how this Legislature works. Please join me in making them feel very welcome.

R. Hawes: In the gallery today we have Dennis Chawrun. Dennis is a retired IT manager who worked for 31 years with the B.C. Assessment Authority. He is joined in the gallery by his son Marc. Marc is one of our legislative assistants who is working in my office. For those of you who would be interested in some lessons, Marc is a former member of the Canadian Professional Golfers Association. I'd like to congratulate Dennis for raising a son with such fine political instinct, and I'd ask the House to make them both welcome today.

Hon. G. Hogg: On March 8 at the B.C. girls triple-A high school basketball championships, the Elgin Park Orcas of Surrey were victorious at an exciting overtime game where they beat Riverside of Poco. I hope this House will join me in congratulating the Elgin Park

Orcas, their coach Stu Graham and the citizens of Surrey for a great victory again in basketball.

Hon. O. Ilich presented a message from His Honour the Lieutenant-Governor: a bill intituled Labour and Citizens' Services Statutes Amendment Act, 2008.

Hon. O. Ilich: I move that Bill 13 be introduced and read for a first time now.

Hon. O. Ilich: Bill 13 amends the Employment Standards Act, the Freedom of Information and Protection of Privacy Act, the Labour Relations Code and the Workers Compensation Act.

It is appropriate that during Farm Safety Week, these legislative initiatives are the final phase of the package I announced last May to address protection for farmworkers. This legislation includes tough new requirements involving farm labour contractors. Changes to the Employment Standards Act will allow for the suspension or cancellation of a farm labour contractor's licence for significant WorkSafe B.C. or motor vehicle violations. If a contractor violates safety rules, they will be out of business.

As well, if a farm labour contractor's vehicle is found unsafe during a roadside check, the contractor will be required to pay for alternative transportation to get the farmworkers to the worksite. This will be done through an administrative fee payable to the province to recoup expenses for that alternative transportation.

A further change to the Employment Standards Act will prohibit a producer from using an unlicensed farm labour contractor. Those who do will be subject to mandatory escalating financial penalties.

The amendments to the Freedom of Information and Protection of Privacy Act address recommendations of the special committee that reviewed the act. They also include a number of other changes and amendments that will streamline certain provisions. These amendments have been the subject of consultations with the Privacy Commissioner's office, which has endorsed these changes that will enhance privacy protection and strengthen the act by improving disclosure and consistency. The amendments enhance the act's privacy and access provisions to ensure that it remains the strongest legislation of its kind in Canada.

The change to the Labour Relations Code introduces a new requirement for the Labour Relations Board to make decisions on complaints or applications within time periods prescribed by regulation.

The change to the Workers Compensation Act provides that workers' advisers and employers' advisers will be appointed as employees of the Ministry of Labour and Citizens' Services under the Public Service Act rather than by order-in-council.

I move that Bill 13 be placed on the orders of the day for second reading at the next sitting of the House after today.

Bill 13, Labour and Citizens' Services Statutes Amendment Act, 2008, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

Hon. R. Thorpe presented a message from His Honour the Lieutenant-Governor: a bill intituled Small Business and Revenue Statutes Amendment Act, 2008.

Hon. R. Thorpe: I move that Bill 11, entitled Small Business and Revenue Statutes Amendment Act, 2008, be introduced and read for a first time now.

Hon. R. Thorpe: This bill proposes amendments to the assessment and taxation statutes administered by the Ministry of Small Business and Revenue. The amendments of this bill reflect our commitment to continuous improvement in customer service, streamlining and simplifying legislation, and promoting fair and efficient tax administration.

The bill proposes amendments to the Assessment Act, the Hotel Room Tax Act, the Income Tax Act, the Insurance Premium Tax Act, the Social Service Tax Act and the Tobacco Tax Act. I will elaborate on the nature of these amendments during second reading of the bill.

I move that Bill 11 be placed on the orders of the day for second reading at the next sitting of the House after today.

Bill 11, Small Business and Revenue Statutes Amendment Act, 2008, introduced, read a first time and ordered to be placed on orders of the day for second reading at the next sitting of the House after today.

J. McIntyre: Today I'd like to salute the Rotary Club, West Vancouver Sunrise. The Sunrise club has served the North Shore and the international community since 1989 with their terrific hands-on work and fundraising initiatives.

On March 1, I was pleased to be invited to their Spring Fling fundraiser, particularly as all proceeds raised are going to the Lions Gate Hospital's campaign to realize their dream to create a freestanding hospice.

The '50s-and-'60s-themed Spring Fling was truly a fun, refreshing event where we were entertained with a deejay spinning our favourite old-time hits. To add to the entertainment, I found myself selected as a contestant in a rock 'n' roll trivia game versus the mayor of West Vancouver. It looks like my rock 'n' roll days finally paid off when my trivia skills caught everyone off guard and carried me to victory, much to the guests' amusement.

Not only did I have a great time, but I'm honoured to participate in a cause that is near and dear to North Shore residents' hearts, sponsored by a group that works every day for positive change and optimism both at home and abroad.

The Sunrise club really shone recently with their hard work and commitment in assisting to reopen the North Shore Safe House. As one of a number of local community supporters, the Rotary clubs of the North Shore provided capital funding and assisted in rallying both the federal and provincial governments to get on board to fund this great cause to protect our youth at risk and keep them on the North Shore.

I'd like to thank all the members involved in the organization, including their president, Vicki Haller, for their contributions to the community. I'd also like to make special mention of Val Stephenson, who has undergone surgery recently, and credit her for both the successful Spring Fling as well as her ongoing commitment as the community service director. In her duties she also ensures that the senior shut-ins of West Van have Christmas lunch every year. She personifies the term "volunteer."

The Rotary Club of West Vancouver Sunrise has raised the bar in community standards and certainly lives up to the Rotary motto of "Service above self."

D. Cubberley: Last year on World Kidney Day I used humour to make a serious point about kidney health. This year, focusing attention on this obscure organ we rely on to detoxify ourselves, the Kidney Foundation of Canada is taking blood pressure readings in our reception hall.

What's the connection? Hypertension is a risk factor for chronic kidney disease and type 2 diabetes, which some 325,000 of us will have by 2010. The end stage of type 2 diabetes is chronic kidney disease and renal failure.

Hypertension doesn't mean that we're doomed, but we should pay attention; 46 percent of women and 38 percent of men over 60 have to go on blood pressure–reducing drugs. Excessively salty foods, the norm for industrial eaters like us, spike blood pressure. The body reacts to it with thirst. That brings liquids, which it uses to dilute and expel the salt. Over time, this assault on the kidneys causes damage.

Consider the current diabetes epidemic and the convergence of three vectors in the United States, now the world's fattest nation. Between 1988 and '94 alone, the prevalence of obesity rose 61 percent amongst men and 52 percent amongst women. Between 1983 and 1998, per-capita salt use rose by 55 percent while the consumption of carbonated soft drinks rose nearly 50 percent.

Salty food — thirst. Energy-dense drinks — weight gain. Exaggeration of the hypertensive effect of salt — spike in chronic kidney disease and type 2 diabetes. It's not a pretty picture. That's why we're trying to bring kidney health out of the closet.

What should be done? I say: let's get serious about our diet — individually, for sure. But how about societally? Kidney care means being salt-aware. It's as simple as that. So let's try something novel, and think like a legislature about how we can raise salt awareness and reduce salt use in restaurant and packaged food.

D. Hayer: The city of Surrey will soon be the largest city in the province, but there is a real sense of community within it — a sense of community that goes back to the days of our pioneers. Port Kells, in my Surrey-Tynehead riding, has existed for more than 120 years. Despite its image as an industrial and commercial hub, it remains a very strong community association and an agricultural route, which first attracted our pioneers to settle the banks of Fraser River.

Port Kells was established in 1885 by two brothers-in-law, both remarkably having the same name of Henry Kells. That pioneer spirit still lives on today, embodied in Port Kells Community Association — active for more than 80 years. It's working in the best interests of all Port Kells residents.

One of the association's strongest assets is former president Wally Sandvoss, who developed the Port Kells historic walking tour; saved the Baron Von Mackensen heritage house; and designed the Port Kells cenotaph, which since 1998 has paid homage to those brave soldiers from Port Kells and other parts of my Surrey-Tynehead riding who gave their lives in the two world wars and worked as peacekeepers around the world to preserve the freedom we enjoy today.

The Port Kells Community Association is strong, due to the outstanding leadership of previous past presidents, directors and volunteers. That positive influence will continue with the current president Darlene Bowyer, aided by executives and directors Doug Wiebe, Sandy Cattermole, Elsie Preedy and Steve Greenly, and many other great volunteers who are working on many projects including the community benches, art banners, bicycle jumps and Port Kells Park.

Please join me in saluting the outstanding volunteers, both past and present, who work tirelessly to preserve the community spirit.

R. Fleming: I rise today to recognize a wonderful community project underway in my constituency of Victoria-Hillside. I'm referring to the Ryan Street greenway project. The Ryan Street greenway is a project

to enhance an undeveloped road allowance. This neglected area still boasts an impressive stand of large, mature Garry oak trees, some of which are a century old or more.

The new greenway will connect to Ryan Hill park, which is the city's newest neighbourhood park preservation area. This park and the greenway are designed to showcase the unique ecosystem, indigenous to the southern island, of arbutus trees, Garry oak, camas and other wild vegetation. This was the ecosystem that Songhees and Esquimalt people lived off for thousands of years. The vast tree canopy, a natural environment, is one that Captain Cook marvelled at and described in paradise-like terms in his diary.

Though still underway, the Oaklands Community Association's parks committee has made enormous progress with the Ryan greenway project, and it is becoming even more evident with the advent of spring.

The committee's visible accomplishments today are the result of thoughtful planning and fundraising going back almost two years. It's a great collaboration with the city of Victoria's parks department that involves a number of community partners, including St. Alban's Church and students at Oaklands Elementary and the nearby preschool.

To ensure that the Garry oak meadow continues in perpetuity, these kids were involved in planting new trees among existing trees that are the age of their great-grandparents. The upshot of all this hard work is, of course, the beautification it now provides and its interpretive value.

The Oaklands area now has a wonderful, interesting natural place to walk. Volunteers will continue throughout 2008 to reintroduce native plant ecosystems to restore indigenous insects, birds and animal species.

I invite all the members of this House to join me in thanking the Oaklands Community Association parks committee for their extraordinary volunteer work. I'd like to extend special recognition to two of my constituents, Mr. Ludo Birch and Peter Ireland, who were instrumental in getting the Ryan Street greenway project established. These two worked tirelessly with the city of Victoria.

J. Rustad: I rise today to highlight a Vanderhoof success story. The BID Group of Companies is an incredibly innovative corporation that's always been a leader. BID has an enormous amount of expertise to offer its clients, especially in the forest industry. Principals Brian and David Fehr always look for new opportunities, and recent changes in northern B.C. have literally opened up the world to the BID Group.

Over the past few months BID has undertaken a $4 million contract to supply engineering and equipment for the Russian forest industry. Russia has mandated the halt to most log exports, and this has created a market for our companies to take advantage of. B.C. has some of the top technology and equipment builders in the world, so it's a natural fit to meet the Russian demand.

BID was successful in receiving a contract that has kept 50 people busy for months building and engineering products. They're aggressively going after additional contracts, and with their track record, I'm confident they'll continue to open up new opportunities.

But one of the big reasons the BID Group has been able to expand its global opportunities is because of the new container port in Prince Rupert and subsequent inland container port in Prince George.

BID is able to be successful because of their ability to access containers and load cargo through Prince George. This transportation advantage has played a huge role for BID, as I'm sure it will for many other companies throughout the Highway 16 corridor.

BID's example shows that the commitment to expand the Port of Prince Rupert will pay dividends for northern B.C. as well as the province.

Please join me in thanking manager Keith Spencer, shop manager John Simoes, Ken Yorston and all of the staff at BID for their efforts in making the BID Group successful and in showing B.C.'s leadership on the world stage.

C. Puchmayr: This week is Canadian Agricultural Safety Week. It is a theme supported by more than 500 farm safety advocates across Canada.

Every year farming mishaps in Canada lead to over 100 deaths and 1,500 serious injuries. What is truly alarming is that 15 percent of fatalities and injuries are to children under the age of 16. We need to ensure that farmworkers have the necessary protections and safeguards required to allow them to work in the safest possible manner. We also need to implement a zero-tolerance policy when it comes to exposing children to hazards in the farm.

This province has over 19,000 registered farms. Some are small family farms, and some are large, industrious, hothouse operations employing more than hundreds of people.

I know many farmers, and farming is certainly a noble profession. It can be hard work and long hours. There are many potential hazards on farms, from confined-space oxygen deficiency, machinery rollover, entanglement, chemical exposure and — what I will never forget — transportation of farmworkers to and from work.

These hazards lurk in the wings daily and expose farmworkers. The risks contribute to death and injury of farmworkers every year. We must ensure that we use all preventative measures to eliminate all hazards in the workplace.

I once lived on a farm as a young boy, and I remember playing in the grain silos. Kids, do not do this at home. I also remember the tortuous milk run that we made every day with my brothers, packing that pail of milk up the long driveway, which seems like miles when you're five years old.

Whether working or living on a farm, education and vigilance are key to protecting lives and preventing

injuries. So let's not just make this week Canadian Agricultural Safety Week. Let's make every week Canadian Agricultural Safety Week.

C. James: Yesterday Ken Dobell, the Premier's closest friend and adviser, pled guilty to violating B.C.'s lobbyist laws. Today the case is no longer before the courts, so perhaps the feeble non-answers from government will actually be put to rest today.

But British Columbians are still waiting. They're still waiting for the Premier to come clean on his role. British Columbians are still waiting for the Premier to take personal responsibility for the ethical breach that occurred in his office.

Will the Deputy Premier or someone — anyone on that side — finally admit that the B.C. Liberals caused this mess? Will they hold someone accountable, and will they actually stand up and apologize?

Hon. W. Oppal: We are fortunate to live in a democracy which has as its fundamental principle the rule of law. The rule of law embodies an independent judiciary. We're fortunate in that we have independent judges who decide cases fairly, objectively, on a clinical weighing of the evidence, without any bias, without any prejudice, without any salacious reference to any kind of conduct.

In this case, Judge Joe Galati, a highly respected judge of the Provincial Court, concluded that Mr. Dobell's violation of the act was trivial. He spoke repeatedly of Mr. Dobell's integrity and of his unblemished past. He said that this was an honest but mistaken violation of the statute, and he imposed an absolute discharge.

C. James: Even Mr. Dobell had to write an essay admitting that he was wrong. The Premier hasn't even gone that far. We haven't even had an apology or anything from him.

The Premier and his office created the arrangement, personally signed off on Ken Dobell's contracts. The special prosecutor called this scheme influence-peddling. Ken Dobell admitted his mistake. He actually pled guilty.

But the B.C. Liberals are just too wrapped up in their arrogance to admit that they played any part in this. The Premier's unwillingness to acknowledge his breach and his role in this is reprehensible.

Again to the Deputy Premier: will someone take personal responsibility on that side of the Legislature, live up to the Premier's big talk around accountability and apologize to British Columbians?

Hon. M. de Jong: Well, what's really at play here today is the expression of profound disappointment on the part of the Leader of the Opposition who, as justice is dispensed by that body that is responsible for doing so in an independent and unbiased way, has now removed the ability….

And it should have registered with the Leader of the Opposition. To continue to smear individuals, to continue to make reprehensible references to the conduct of well-intentioned public servants…. You know who should go back to their office? You know who should engage in a little bit of…?

Hon. M. de Jong: Well, I wouldn't call it a detention, but maybe the Leader of the Opposition should go back to her office and write a thousand times, "I will respect the independence of the courts," and see if she can figure that out.

C. James: I shouldn't be surprised. I shouldn't be surprised at the response from this government, because it's very clear that over the last seven years they have taken no responsibility for accountability and integrity for British Columbians.

C. James: …and say that the issue is before the courts, so now they say that there is no issue. That's the response from the government. "There is absolutely no issue here." Well, that's extraordinary.

C. James: It's extraordinary that the government would say that there's no issue here when you have Ken Dobell, the Premier's closest friend, pleading guilty and a special prosecutor who calls it influence-peddling.

The Premier and his office are tainted, and no one on that side of the Legislature will take responsibility. They won't fire anyone responsible. They won't even admit that there's a problem, and not only that, they're rewarding Ken Dobell by having him continue to work with government. They're allowing him to stay — after he's pled guilty — and continue to do business.

To anyone on that side of the Legislature: if the Premier won't take responsibility, if he won't hold anyone accountable, if he'll continue to let Ken Dobell work with all of you on that side of the Legislature, how can British Columbians have any kind of faith that the Premier even understands integrity?

Hon. M. de Jong: You can hear the disappointment dripping from the words of the Leader of the Opposition.

Hon. M. de Jong: Mr. Dobell appears before the court. Submissions are made, and the court imposes an absolute discharge and in the process of so doing, we are advised, characterizes the matter as trivial and technical. In the immediate aftermath of that, this Leader of the Opposition comes into this chamber and maligns the character of the deputy to the Premier, the Deputy Attorney General, the deputy minister of the Public Service Agency — all of whom have had their conduct in this validated. No one has said anything contrary to the work they did.

The Leader of the Opposition doesn't like it, and the opposition doesn't like it because in their insatiable lust for political blood, they have been dealt a blow today by the justice system itself.

M. Farnworth: This is a serious issue, and all we hear are diversionary tactics and arrogance from the government benches.

M. Farnworth: I wish they'd saved the Britney Spears–supporter act for YouTube, because this is about arrogance — government arrogance.

This is about a Premier who signed off on a contract, who signed off on the conditions. This is about the Premier's closest friend and adviser, who pled guilty and broke the law. This is about a government that wants to hide behind and not answer questions, saying that it's before the courts.

M. Farnworth: The members opposite may think it's trivial to violate the law. They may think it's trivial that words such as "influence-peddling" are contained in a special prosecutor's report.

We don't. We believe there should be accountability. We believe the buck stops on the Premier's desk.

My question to the Attorney General is: when is the Premier going to stand up in this House and apologize to the people of this province?

Hon. M. de Jong: It was disturbing enough to learn how readily the opposition was prepared to dismiss the advice and counsel that was received from the Deputy Attorney General, from the deputy responsible for the Public Service Agency. But here today, to hear how readily they are prepared to dismiss outright the findings and commentary of the court — that body which is charged with dispensing justice — speaks volumes about the attitude and behaviour of this opposition. I find it very unfortunate.

M. Farnworth: What's disturbing is that this government will not learn from this incident. It has made no commitment to changing and dealing with the issues raised in the Lobbyists Registration Act. It has made no effort to explain the role of the Premier. The Premier has not stood up and explained his actions.

What we have seen is continued arrogance from a government that feels it can do what it wants, when it wants, with complete impunity and no accountability. That is not right.

This is about the relationship between the Premier and his closest adviser, how it was handled and how it continues to be handled.

My question again to the Attorney General is: when is someone on that side going to stand up and take accountability? The buck stops at the Premier's desk. When is he going to stand up and apologize to the people of British Columbia?

Hon. M. de Jong: We have canvassed at length in this chamber the work that was undertaken at the crucial time where advice was sought by the deputy to the Premier from the Deputy Attorney General, from the deputy….

Hon. M. de Jong: Members opposite increasingly probably wonder why not just members of this chamber but the public don't take them seriously. It is because…

Hon. M. de Jong: …of the kind of comment we just heard a moment ago from the opposition benches that their relevance and the seriousness with which the public takes them is continuing to decline.

In addition to the advice that the deputy to the Premier sought, which influenced her in the preparation of the memo that has been discussed in this chamber, I note that there was a letter received, and is now in the public domain, that was produced sometime thereafter — June 5, 2007 — from one of the leading lawyers in British Columbia, Mr. Richard C. Peck, QC. Here's what he says, having analyzed all of the circumstances.

Hon. M. de Jong: "As already explained, my view is that Mr. Dobell has taken adequate steps to disclose the potential for conflict and obtained both governments' informed consent to this state of affairs. In my opinion, these measures are sufficient to dispel any allegations of impropriety which have been or might in the future be lodged against Mr. Dobell."

B. Ralston: Those who know the Premier well speak of his tendency to micromanage. It's inconceivable that he wasn't aware of Mr. Dobell's conflicting roles and his lobbying duties. In fact, the Premier himself personally signed off on Mr. Dobell's contract. This is the conduct that the Government House Leader now wrongly describes as validated.

Will the Deputy Premier ask the Premier, in all good conscience and with a sense of honour, to come forward to this Legislature and apologize to the people of British Columbia?

Hon. M. de Jong: This member, as an officer of the court, has not distinguished himself throughout the discussions that have taken place in this chamber.

Hon. M. de Jong: Maybe this member, upon reflection, will be able to convene with his colleagues in the opposition and explain to them what it means for a court to adjudicate a matter, for a judge to hear submissions and for a judge to render decision, and how inappropriate it is — notwithstanding whatever the political interest is in trying to extract an extra ounce of blood — for this opposition, as they have tried to do all week, to intervene in that judicial process and in the process of so doing malign the good character of honourable public servants in British Columbia.

B. Ralston: It's significant that the Government House Leader, as a sometime member of the bar, has come forward with a very garbled legal explanation of what took place in the court.

The issue here, now, is about the conduct of the Premier in this matter. The court matter is dealt with. The issue is about the conduct of the Premier. So why will the Deputy Premier…

B. Ralston: …not ask the Premier to come forward and level with the people of British Columbia and offer an apology for his role in this scheme?

Hon. M. de Jong: No one is going to apologize for the fact that we sought advice from the Deputy Attorney General. No one is going to apologize for the fact that we sought advice from the deputy of the Public Service Agency. But maybe in the aftermath of the findings of the court today and the commentary from the judge and the imposition of an absolute discharge, this member or one member of the opposition will stand up and apologize to the public servants they have maligned during the course of this debate this week.

R. Fleming: Yesterday and again today we received an interesting lecture from the Government House Leader. He says, in effect, that we should not question Ms. McDonald's decisions or judgments in dealing with her mentor Mr. Dobell, because in clearing him, she sought advice from the Deputy Attorney General and the head of the Public Service Agency.

It would appear, according to the Government House Leader, that the B.C. Liberals have turned the notion of public service accountability on its head. According to the Government House Leader, now senior civil servants won't be held responsible for their actions, provided they first seek the advice of people who report to them.

R. Fleming: Has she communicated this new policy to the heads of all government agencies?

Hon. M. de Jong: Well, any reasonable person listening to the hon. member in forming that question just a moment ago would be obliged to conclude that he believes that the Deputy Attorney General did not proffer a legitimate opinion, did not exercise due discretion,

That seems to be very much on par with what another member of the official opposition tried to do just a week ago. It is becoming a disturbing trend on the part of this opposition.

If he doesn't believe the Deputy Attorney General, if he doesn't believe the deputy to the Public Service Agency, I'll read it again — from Mr. Richard Peck: "As already explained, my view is that Mr. Dobell has taken adequate steps to disclose the potential for conflict and obtained both governments' informed consent to this state of affairs. In my opinion, these measures are sufficient to dispel any allegations of impropriety which have been or might in the future be lodged against Mr. Dobell with respect to his work for the city or the province."

M. Karagianis: I'm trying to wrap my head around the logic here. So the government is saying: "Wait. We peddled influence, but the opposition has to apologize." Is that what this logic is here?

I'll tell you what's inappropriate. What is inappropriate in this House is a government that will not take responsibility for its own conduct. For days now, the government has refused to do the right thing and sever their ties with Mr. Ken Dobell. Mr. Dobell is registered as a lobbyist and is right now lobbying on behalf of Cubic Transportation Systems to the Minister of Transportation. The minister has admitted that he's met with staff.

The minister is great at being very vocal back there when the question is not directed to him, so I will direct a question to him so he can be vocal on his feet here. Mr. Dobell has pled guilty to breaking the lobbyist law. Will the minister do the right thing and refrain from letting his ministry meet with Mr. Dobell in the future?

Hon. M. de Jong: Well, maybe the member could be less cryptic. Maybe she could stand up in this chamber and make it absolutely clear that she is dissatisfied with the justice that has been dispensed by the court in British Columbia and believes additional sanction needs to be imposed against the individual involved.

Why doesn't she say that — say that she's still dissatisfied, say that she believes her opinion on this matter is more important and more applicable and more relevant than the courts in British Columbia?

M. Karagianis: Well, I will tell the hon. House Leader of the government that what this side of the House is dissatisfied with is the ethical breach on that side of the House and that government's behaviour. That's what we're dissatisfied with.

This is a government that does not seem to have any problem dealing with a lobbyist who has pled guilty to breaking the law and who has, according to the special prosecutor, engaged in influence-peddling. This government sees no ethical dilemma with continuing to meet with him.

Do the right thing. Cease meeting with Mr. Dobell in all ministries, and do it today.

Hon. M. de Jong: Well, it is only now becoming apparent to me that we are basking in such brilliant judicial thought over on that side of the bench, where members feel qualified to substitute their opinion….

The member should just say it. The member should just stand up and say, "I don't believe the court has done a good job," because that's what she's saying. "I'm not satisfied," she says, "with the sanction that's imposed." She is saying: "I reject the characterization of this matter by the presiding judge…

Hon. M. de Jong: …and I believe it's more appropriate for politicians in this chamber to substitute their view in the place of the court."

That's what divides this side of the House from that side of the House. We believe in the rule of law. We have, we do, and we always will. That's something this member will never be able to say.

J. Kwan: What we reject on this side of the House is the lack of accountability from this Premier and from this government.

In Ken Dobell's mea culpa essay, he stated: "Over the course of my work in government and since leaving it,

I now recognize that I've encountered a number of individuals doing work that would likely fall under the ambit of the legislation who may not be registered."

My question is to the Attorney General. Can the Attorney General tell this House if Mr. Dobell has reported those names to the proper authorities?

Hon. M. de Jong: I alluded earlier to the fact that maybe what the hon. member and her colleagues will want to do is take a page from Mr. Dobell's essay and write one of their own, and start with the principle of judicial independence. It's a concept that seems very elusive in their minds.

Hon. M. de Jong: I know this is difficult for the opposition — the very notion of justice having been done in the province. It's stripped from them a tool they hoped to extract political advantage from — must be terribly disappointing. But that's what the administration of justice is all about, and we intend to respect that process.

Sadly, throughout this debate the opposition and the opposition leader have made it very clear that they do not respect that process.

J. Kwan: The Attorney General is the top attorney in this province. He has been advised by the Premier's friend and adviser Ken Dobell that he knows of others who may be in violation of the government's own law. No one should be above the law.

J. Kwan: Has the Attorney General directed his office to ask Mr. Dobell to report those names to the proper authority?

Hon. M. de Jong: Well, Mr. Dobell, in his material, does make it clear. He has a very clear message — that people need to understand what their obligations are under the Lobbyists Registration Act and abide by them. They need to abide by the law.

Hon. M. de Jong: They need to abide by the law as it is developed and created in this chamber, and they need to abide by the law as it is adjudicated by the courts, independent of political interference, independent of the kind of rhetoric we have heard over the last week or two weeks in this chamber.

Hon. M. de Jong: …that this opposition has revealed itself to have such a fundamental lack of understanding of one of the fundamental precepts of our society. And as….

Hon. M. de Jong: Oh, I think there's another applause line in this somewhere, Mr. Speaker.

So I hope the members will leave this chamber, go back to their offices, reflect upon what has taken place and understand that when it comes to preserving the independence of the judiciary, this government will do it, the Attorney General will do it and the Premier will do it. We'll all do it. They can take a lesson from that, and I hope they'll reflect upon that over the next two weeks.

L. Krog: I rise to table a petition signed by 931 Gabriola Islanders calling on the government to place a moratorium on ferry fare increases until a special legislative committee is enacted to review the Coastal Ferry Act.

B. Bennett: I have the honour to present the first report of the Select Standing Committee on Finance and Government Services for the fourth session of the current parliament. This brief report summarizes the committee's endorsement of a request for supplementary funding by the Information and Privacy Commissioner.

B. Bennett: I ask leave of the House to permit the moving of a motion to adopt the report.

B. Bennett: I move that the report be adopted, and in doing so, I wish to note that the Select Standing Committee on Finance and Government Services met on March 5, 2008, and endorsed the request of the Information and Privacy Commissioner to seek an additional $75,000 funding for fiscal year 2007-2008.

The purpose of these funds is to defray unanticipated costs incurred by his office with respect to legal proceedings. As these funds will be allocated from existing contingency funds for this fiscal year, I understand that there is no requirement for a formal supplementary funding process to be undertaken by the House.

Hon. C. Hansen: This actually just literally arrived on my desk in the last 30 seconds, and I was anxious to table this before the break. It's a petition signed by 2,338 citizens with regard to preserving land in Pacific Spirit Park.

Hon. M. de Jong: I call in Committee A, Committee of Supply, continuing with the debates of the Ministry of Labour and Citizens' Services, to be followed at some point, I'm sure, by the Ministry of Transportation, and in this chamber, continued committee stage debate on Bill 12, the Musqueam Reconciliation, Settlement and Benefits Agreement Implementation Act, to be followed at some point by Bill 9.

MUSQUEAM RECONCILIATION, SETTLEMENT
AND BENEFITS AGREEMENT
IMPLEMENTATION ACT
(continued)

The House in Committee of the Whole (Section B) on Bill 12; S. Hammell in the chair.

Hon. M. de Jong: I feel particularly obliged to correct something I said earlier this morning in this debate, relating to the state of the constitutional law at the time that Pacific Spirit Park was created. Of course, that was 1989, not 1979. Therefore, the constitution had been repatriated, and existing aboriginal rights were very much a part of the constitutional mix at that time.

I wanted to correct that and point out that, in part, my ability to make that correction is due to the fact that one of the assistants that serve us so well served on the flight that brought the Queen and the constitution to Canada in 1982. So we have a little bit of history here in the building as well. But I did want to correct that on the record, Madam Chair.

S. Fraser: Thanks to the minister for that correction on constitutional history.

On section 3, which is the last section I will be dealing with, on subsection (3), so section 3(3)…. Then I'm going to turn a few questions over to my colleague to the right here.

It says: "On the effective date, and despite the University Endowment Land Act, the minister responsible for the administration of that Act may, on behalf of the government, indicate in writing his or her support for the addition of Block K to Musqueam Indian Reserve No. 2."

I need some clarification, if I could, on the term "may." I understand there's probably a legal standard reason for using the word "may." But "may" to me always means…. It could also mean "may not." It's not a very definitive statement. Can the minister maybe explain the wording of that section?

Hon. M. de Jong: I can, hopefully, do even more than that. We actually contemplate that with respect to block K…. Because of its location on the south side of Marine Drive, adjacent to the existing reserve, we anticipate an application being made by the Musqueam to have that parcel joined to their present reserve.

The language in this bill contemplates that. In the agreement it is even more explicit. We will be supportive of their application to have the lands joined. When they make application to the federal government, we will be supportive of that application.

S. Simpson: I've just got a couple of questions that relate to the official community plan in the UEL and the impacts particularly around block F, but the impacts on the official community plan. Could the minister tell us what consultation or discussion was had around the official community plan, particularly with the Community Advisory Council and those people who have been involved in the development of the plan in terms of the impacts of these changes on the plan?

Hon. M. de Jong: I'm happy to answer the questions. I think they're more appropriate to section 4 of the bill.

S. Simpson: I'm happy to take the minister's advice on that and discuss them in section 4.

S. Simpson: Again, I'll just re-put the question. Could the minister tell us what discussions have been had around the official community plan, particularly with the Community Advisory Council in the area and those people who have worked on the development of the plan, and what the impacts of these changes will mean for that?

Hon. M. de Jong: The agreement from which the legislation derives is predicated on the assumption and expectation and guarantee, as it were, that the lands we're dealing with here will be rezoned, and this act does that. So to that extent, there is no public consultation. This deems those lands rezoned.

What flows from that with respect to any subsequent subdivision or building permit applications is a process that is discretionary and that engages the public officials who, I am advised, would then engage with community input and the community association. Insofar as the actual rezoning of the land is concerned, this act deems that to have occurred.

S. Simpson: My question to the minister on this is really a process question. I appreciate that the law is what it is, and it will make some changes that supersede other things that have preceded it. That's not the point of discussion here. The discussion is the process here and how those….

Obviously, because of the nature of this case, the primary discussions were between the government and the Musqueam to sort out a settlement that was acceptable to everybody. I acknowledge that. I am more concerned about where we go now and what this means for now.

I know there has been a significant amount of work done around the official community plan in the UEL — a significant amount of community engagement around that. I have spoken to members of the Community Advisory Council there, who have contacted me — frustrations they've had about…. Plans get signed off. Changes are made. They're not in that discussion, even if they're not decision-makers.

The question I have is: what happens now in terms of the potential implications of this plan? For example, there has been a discussion around the swap of lands around what will be parkland, as it relates to the area where the golf course is now, versus a block of land that's coming out for other uses. Who is going to be involved in the discussion around what those boundaries actually look like on that parkland, what is an allowable use in that park space and how it gets managed as part of a plan?

I'm trying to figure out how — other than the Musqueam, who obviously have an integral role in these discussions — the rest of the community that's been involved in these OCP processes has a role to play in these discussions.

Hon. M. de Jong: A couple of questions there. I'll try to answer all of them if I can.

With respect to the parkland, those boundaries are defined in the actual agreement, so the boundaries are known now. The fact that they will be jointly managed, I think — the area that we are discussing here…. There will be work taking place between the Musqueam and Metro, as it's now called, to establish the protocols for that.

With respect to the UEL and the lands there, there are probably two answers and two mechanisms I can think of that would engage the public on a continuing basis.

Firstly, an application for either a subdivision or a development permit would engage discussion between the authorities and the Community Advisory Council. Then in a broader way…. I've got the agreement. It's article 6.06, which speaks to the fact that there is a land use bylaw review being embarked upon within the University Endowment Lands.

The most relevant portion of this section is as follows. I hope this will provide the member with some of the answer and comfort he's looking for: "Musqueam further acknowledges and agrees that any of the lands within the University Endowment Land as defined by the University Endowment Land Act and not held as reserve land will be subject to and benefit from the terms of the land use bylaw and the OCP as these enactments may be amended from time to time."

So they are very much captured by that ongoing review process that, as I understand, is on the verge of being launched and will continue as the years pass.

S. Simpson: Am I to take from the minister's answer that questions related to activity within the parkland, the new park space that's created…? Maybe more importantly, as we look at block F and potential development in block F of residential…. We know that already we're hearing all the time about, in the university lands, pressures of growth and population growth and pressures around new schools. There's a significant debate going on related to that in Vancouver right now, about new schools in the UEL land.

Am I to take from the agreement that it's the government's position that any discussions around the consultation around that need to occur and need to involve the Community Advisory Council, and that changes to the official community plan — if they're made — that need to come back to the government…? That whole process will continue as it is today and will come back for changes to the plan as it relates to developments on block F?

Hon. M. de Jong: I think the point I want to emphasize is that the agreement in this legislation — that flows from it — does not supplant the usual processes for the approval of the official community plan, as changes may be proposed from time to time. Nothing in either of these documents acts to supplant that process. I think that's what the member's question related to.

S. Simpson: The reality is — and I understand this because it's an essential part of putting the agreement in place — that the plan has been changed by the nature of the legislation. That's a decision the government has made in order to be able to honour the agreement that has been reached with the Musqueam. I understand that.

What I'm looking for is assurances that as we get past Bill 12, the future for uses on block F and other uses in the community will, for lack of a better term, revert back to what has been the standing processes around changes to the OCP — around Metro's role and around the need for the community to be fully engaged through its advisory council — and that all of that process will be kept whole once we get past the changes that have been made through this piece of legislation. Then we'll be back to a process that will look more like that. The government endorses that and will only consider changes to the OCP which come through that kind of a process, where everybody has played the role they're supposed to play.

Hon. M. de Jong: I believe the member has accurately described how we believe this is to operate by virtue of what is set out in section 4(3).

S. Simpson: Maybe this is a question that comes a little bit outside of this, but I know it's important for the community. In the conversations I've had with folks involved in the Community Advisory Council, they've expressed concern to me that they've made some efforts to have discussions with the minister and with the Premier, who is their MLA, in January. They've not been satisfied as to how those efforts to have those discussions have occurred. I understand that while this was being written, there may be reasons why that didn't occur.

I would ask at this time to the minister: in relation to section 4 and how the community plan work plays out, would the minister be open to having some discussion with the people involved at the Community Advisory Council, who have responsibility in the community for representing their neighbours, around their specific concerns about the plan — not about revisiting what we've gone through here but about the impacts on the plan, moving forward?

Certainly, we can ask this of the Premier, as well, at another time. But will the minister have some discussion with those folks so that they directly get the comfort that they're not going to have their planning process supplanted in future by decisions made around this, once we get past this piece of legislation?

Hon. M. de Jong: I have had some limited discussions in the lead-up to the signing of the agreement and the introduction of the legislation.

I think it's entirely appropriate, now that the package is here and the agreement has been finalized — hopefully, soon the bill will be passed — that we sit down and, maybe as importantly, as politicians, move through the agreement and the legislation technically so that everyone understands how it is designed to operate, how it is designed to preserve the decision-making matrix that is in place. I have no hesitation in agreeing with the member that it's appropriate for that to happen, and I think it's a good idea.

S. Simpson: To the minister. I thank him for the answer, and I'm very hopeful. Certainly, of the people who have spoken to me in the last couple of days in regard to this, my sense is that the concern that I've heard the most has been around the process question. I'm hopeful, if the minister finds the opportunity and affords the time to these folks to sit down and have some of that discussion, that maybe some of those issues or questions can be resolved in a way that is satisfactory to everybody.

The last question that I'm looking for here relates a little bit back to questions around the parkland that is implicated here. One of the concerns that has been raised to me is…. As the discussions go forward with the Musqueam, have there been any commitments made or discussions around any additional lands that fall within the park to be on the table? Or is that a matter for future consideration and not something for talking about here?

As the minister will note, that anxiety is out there. When the minister fulfils his commitment that he's just made here to speak to people in the community, they will raise this question with him, without doubt. So I thought I would just raise it now and get started.

Hon. M. de Jong: Nothing specific. The member is astute enough to know that we have not settled

absolutely the issue of Musqueam land claims, but there have been no specific discussions about a phase 2 or anything of that sort.

S. Fraser: On section 4(3) — that's the last item I have on my sheet here: "Subsection (2) does not operate and must not be interpreted to prevent the enactment or variation of a bylaw under the authority of the University Endowment Land Act after the effective date, including, without limitation, a bylaw or variation of a bylaw that applies to Block F."

Can the minister just help me here? Can I get a Cole's Notes version of what that is stating?

Hon. M. de Jong: What this does is ensure that the zoning designation for block F that is created by this bill, this legislation, is not frozen in perpetuity. It flows from the questions that the member's colleague was asking. It clarifies that these zoning changes that we are enacting here do not restrict or prevent future amendments to the bylaw or the official community plan in regards to block F. That is the impact of this subsection.

S. Fraser: We were on a roll, I know, but I have a few questions around the compensation section, section 7. "On the effective date, the amount of $20.8 million is payable to the University of British Columbia by the government as compensation for the vesting referred to in section 2."

Essentially, the government — and correct me if I'm wrong — has expropriated that land. Is that an appropriate term? Was this a negotiation with the university as far as the amount involved?

Hon. M. de Jong: The member will know that earlier there was a negotiation between UBC and the province that was designed to lead to a sale and transfer of the property to UBC. At the behest of the Musqueam, the courts intervened and determined that that transaction was not going to proceed on the basis that was negotiated. So this statutory attempt to address that issue addresses the fact that the earlier contract between the province and UBC is frustrated.

Later in the bill, the member will note, there is a specific provision — I can't remember what section — that determines that the Expropriation Act itself does not apply. This is a provision that derives from the fact that the earlier contract between the province and UBC was not followed through upon, following the intervention of the court.

Just a little bit further on that. I'm surprised that that is in this bill. I mean, it isn't directly related to the Musqueam. This is compensation to a third party, essentially.

Just a clarification. Is there some legal reason this is in the bill? This is a reconciliation act for the Musqueam. So what's the rationale for having this level of detail of compensation to another party in the body of this bill?

Hon. M. de Jong: In the agreement we seek to clarify the schedule by which the various components of the agreement will be in place and executed upon.

I think the member has identified a key provision. This is the amount the Crown will pay to UBC. So there is certainty about the amount and therefore certainty in accordance with the bill and the agreement about when the transfer will occur. It is with the objective of establishing with certainty what the various components are that this section appears here.

S. Fraser: The amount of $20.8 million…. How was that established? Was that a negotiated settlement with officials from UBC, or was it based on some sort of market value calculation? Possibly the minister could edify us on that.

Hon. M. de Jong: I'm advised and reminded that the amount derives from an appraisal that was completed late in the summer of 2007.

S. Fraser: On section 3, moving on just down here. "No compensation is payable to the Greater Vancouver Regional District as a consequence of the vestings referred to in section 3 and any and all claims by the Greater Vancouver Regional District in relation to the vestings referred to in section 3 are extinguished." Are we referring to the parkland acquisition? I see the minister is nodding.

I'll just continue here. What's the rationale for…? Obviously, the university is receiving compensation in this instance, yet the Greater Vancouver regional district is not.

Hon. M. de Jong: Unlike the university, which at the time of the original transaction had sought to pay just in excess of $11 million for the land, the GVRD, as it then was in 1989, received the lands that comprised Pacific Spirit Park for a dollar. As we talked about earlier in these proceedings, at that time the transaction and transfer was completed in full knowledge of the fact that there was an unresolved issue involving the Musqueam. What flows from that is the transfer here.

The determination is that, recognizing that everyone was aware this was an issue that was going to have to be dealt with at the time the land was transferred for a dollar, there wouldn't be compensation payable at this time.

S. Fraser: Again, clarification is…. Essentially, with the original transfer of these lands to the regional district as parkland dedication, they were not receiving this as fee simple? There was a specific caveat on this that this may well be a temporary situation? I'm just not sure I understand.

Hon. M. de Jong: At the time, two things occurred. The GVRD received what is termed a modified fee simple in terms of the Crown grant restricted to park use, but at the same time that took place it was done so in contemplation of the fact, as set out in the affidavit that was presented to the court, that the transfer took place without prejudice to the unresolved claim involving the Musqueam, which we are in part dealing with today.

S. Fraser: So no compensation for the withdrawal of the lands subsequent. I understand that.

As my colleagues mentioned earlier, there were other issues that happened with the removal of this land from the regional district. Certainly it had an effect to really change the official community plan. That was section 4, but it's still germane to this question, so I hope I'll get some leeway here.

There is a cost associated with official community planning. Has there been any discussion or contemplation of some sort of compensation — not for the land as such. You've explained that well, I think.

The regional district has arguably used the land in good faith for the purposes intended, as parkland. We are seeing that it's having an impact on the community and the residents and certainly on the official community planning process, which is not without its costs. Have there been any discussions about possible compensation — not for the land, but for the processes that fall out of that?

Hon. M. de Jong: I do think it's fair to contemplate that there would be discussions with respect to costs that might accrue relative to the jointly managed parklands that emerge as a result of the agreement in the legislation.

I don't ever want to mislead anyone, though. I don't know that there would be, in terms of the work that would be taking place around the land use plan or OCP reviews. That is work that would be taking place irrespective of block F or block K, so I don't want to suggest to the member that there have been specific conversations about additional compensation on that front. But there will certainly be a discussion around how to deal with any costs that accrue from the jointly managed parkland.

S. Fraser: Just a quick clarification. I am assuming that the "No legal proceeding" section here, section 8, is pretty much boilerplate. The only term in here that I'd just like a little clarification on…. It's referring to the Musqueam Indian band or a designated company. Is such a designated company anticipated? Was this discussed? Perhaps the minister could clarify.

Hon. M. de Jong: Two things flow from the member's question. The designated company, which is a defined term, is necessary — I am reminded — because under our land titles system, it's not actually possible for the band to take a fee simple interest in the property.

So what they would do is incorporate a company, a designated company under the definitions contained in both the statute and the agreement — a company controlled by the band. But it would be a corporate entity that would technically hold the title to the land, and that's why you see the reference to "designated company" in this and a few other sections.

S. Fraser: Thank you to the minister for that. The land, though, is essentially now fee simple, with the owner being the Musqueam band. Is that essentially…? This is not treaty land. This was not derived through treaty. So I just need to finish this off.

The question arises for me…. The autonomy that the Musqueam have on this land is the same autonomy that a private land owner would have. The minister is nodding on that. So this does not supplant treaty. The bill doesn't invoke any of the considerations that happen around land through the treaty process, which is in some ways different than just fee simple land for the general public.

Hon. M. de Jong: No, the member has characterized this correctly. The Musqueam will hold this land as fee simple land via a Musqueam-controlled company and will therefore be in a position to deal with it as they wish, as would any other owner of a fee simple property.

S. Fraser: Just following that, to close this off, I believe. We've touched on this earlier, but does this, then, in any way prejudice the treaty discussions that we all hope will occur subsequent to this? We know that they've been to some extent stalled, partially, certainly, because of the court case, the decision and this bill that has been a product of that. But is this something that will now come back to the treaty table, and we'll say: "Look, land has already been achieved, therefore that will have an effect on what can be negotiated through the treaty process"?

Hon. M. de Jong: I think the most accurate way I can address the member's point is to refer back to article 6 of the agreement. It's short, so I'll read it into the record again.

S. Fraser: I'm a little bit concerned about the wording of this section 9. It's suggesting that the Financial Administration Act…. "The minister may" — again the word "may" — "pay out of the consolidated revenue fund amounts required for the purposes of…." They're listed quite clearly here. The way this is worded, this seems to give the minister essentially free rein on spending. There are no qualifications here. Please comment.

Hon. M. de Jong: To the member, though I am tempted by the prospect he paints, I can assure him that this has been drafted in a very specific way to ensure that there is a statutory appropriation for just those costs associated with this transaction as contemplated by this legislation and the agreement. So the cash transfer and the land costs — but just those things. It does not extend beyond this transaction in any way.

S. Fraser: Okay. But I mean, it allows the minister to draw from the consolidated revenue fund for implementing the agreement and fulfilling the obligations of government under the agreement of this act. It's still pretty much a blanket statement allowing….

Does it allow spending at will? It's not a very tight statement as far as accounting for whatever funds might be entailed in fulfilling the obligations of government under the agreement of this act, especially for those of us who haven't been involved. None of us has been involved in the discussions that led up to this.

Hon. M. de Jong: No, it certainly does not allow or provide for spending at will — quite the contrary. It is limited to those costs associated with the implementation of the agreement. It might help if I alert the hon. member to something I've learned, and that is, that with respect to spending on matters of this sort, there must always be an appropriation. The cost associated with agreements of this must be provided for somewhere in government. There must be a statutory authorization for those costs and covering those costs. So it is restricted to the costs associated with the facets of this legislation and the agreement and is in no way open-ended.

S. Fraser: It must be provided for somewhere. I mean, it's sometimes difficult to follow the trail of money in any bureaucracy. Certainly, in the realms of government, that can be a pretty daunting task to try to follow. So I like to see these things a little clearer.

What defines implementation of the agreement? What exactly are the obligations, and how would the government or the minister be accountable, and where would the minister be accountable? So a lot of questions: what defines the implementation of the agreement, and what exactly are the obligations that the minister has referred to?

Hon. M. de Jong: Essentially, this. These are the components: the cash to the Musqueam; the cash to UBC, accounting for the land costs and the value of the land. The last, hopefully, bit of comfort that I can add to the member is that all of those must be laid out and disclosed in the public accounts. So it doesn't sort of mysteriously disappear somewhere, never to be heard from again. There is a proper accounting of what those amounts are, who they were paid to, and how much must be disclosed as part of the public accounts process.

S. Fraser: Okay, the accounting for this is maybe best handled in the next section.

The cash element of this settlement. The land settlement is quite…. I think we all understand the importance of land, the traditional territory. In many urban first nations situations there's very limited land. So we've seen how that's been acquired, and I understand that.

The cash end that the minister was just referring to — how is that established? Certainly, there was never any amount specified through the courts, so was there a basis, a formula, as there is, arguably, in the treaty process?

Hon. M. de Jong: Very much a product of the negotiation, and that's why this is called a reconciliation and benefits agreement, because in addition to settling the outstanding litigation, there was also an attempt being made to address some of the other concerns that the Musqueam have.

I mean, it does go beyond merely settling litigation in that sense, so it was a product of the negotiation, and we end up with a package that is here before us for consideration.

S. Fraser: I respect and appreciate the fact that negotiations that led us to Bill 12 were all subsequent to the court, basically, ordering meaningful consultation to occur.

We've got land and cash as part of this compensation package through Bill 12. We have the Musqueam, who are involved in the treaty process, stage 4. The treaty process is designed to address accommodation in itself through a tripartite agreement — federal government, provincial government and, in this case, the Musqueam first nation — in a government-to-government-to-government negotiation.

There is a formula laid out in that process that I think is outdated and is not spoken of much in the public. This is an arbitrary, negotiated reconciliation settlement that was ordered by the courts. Does this reflect in any way the normal process that would happen through the treaty process?

I'm talking about, specifically…. There is a certain cap, a limit that is placed on per-capita, if you wish, per-head-count type of thing that happens through the treaty process. Was that contemplated during this discussion?

I don't need the minister to quote that section 6 again. We have two processes happening here. One seems to have usurped the other. The treaty process seems to have been set aside, and there is a formula there.

Will the minister have the negotiators go back to that formula? How do these two fit together in a process that other first nations and non–first nations can look at throughout the province and see as an example? The minister has called this a new era of reconciliation. That's what Bill 12 is or represents. For me it's a confusing era, if this is how we're starting.

Hon. M. de Jong: The member is right. This is not a treaty. There are no provisions in here dealing with self-government, drawdown of powers, concurrent jurisdictions, paramount jurisdictions and anything like that. It is the product of a negotiation that began, in part, in response to pronouncements from the court on a series of fronts and extended, I think, somewhat beyond that.

I think it is wise for the member and me to be having this discussion. I think, though, it is more confusing if one is of the view that each agreement must look a certain way. I don't think the member believes that. I think the member has said in the past that there needs to be a flexibility around the manner in which we arrive at agreements and reconciliation and the journey we take to get there. I think this is the evidence of that. It does not supplant entirely the treaty process, because there are a lot of things missing from this agreement that you would expect to see in a treaty.

I hope, the government hopes and, actually, I think the member hopes that by taking this first step with a partner we have heretofore generally only met in court, we will be able to create a dynamic and a landscape that will allow for the additional discussions that need to take place to move towards treaty.

Now, the member is also correct. Our negotiators, when we embark upon treaty negotiations, operate within a certain mandate that they're handled. I won't repeat article 6, but at some point, one will take account of that, and it will influence those negotiations to a certain degree. I can't tell the member today what that would be or how that would be, but it does all become part of a mix and part of the puzzle.

I prefer to look at this as a first step that will help facilitate a next step that the member refers to insofar as a broader treaty discussion. But it does highlight the fact that there will be necessarily different approaches to hopefully getting to something that resembles the same destination.

S. Fraser: Just to finish off on this section, I thank the minister for those comments. Again, I applaud the Musqueam people for actually taking the step of using the courts. It's unfortunate, but it has led to a form of reconciliation that may not have happened had they not stuck to a hard line and forced the government of the day — through the courts — to negotiate in good faith in this case.

I, too, look forward to true reconciliation through the treaty process to finalize this. The pieces that are missing — the self-governance aspect and those sorts of things — are an essential part in closing that socioeconomic gap and, certainly, essential to recognition of the Musqueam people, and with respect.

I'm now finished with section 9, but I will, as I've warned, stand up again momentarily for section 10.

S. Fraser: It's a short comment here, but I just want to read it to refresh my own memory. I've put a big star around this one. "Amounts of money required to be provided or paid under section 9 (1)" — which we've just discussed — "are not to be taken into account for the purposes of calculating the actual amounts of operating expenses under section 5 (1) of the Balanced Budget and Ministerial Accountability Act."

I guess this leads to the next question, which we've touched on already. Section 10 provides that all the moneys spent under section 9(1) are not subject — the way I read it — to ministerial calculations for the Balanced Budget and Ministerial Accountability Act. Again, where is the accountability? Where is the accounting on this?

How do you find this if you're looking for…? If this is specifically exempt from the act — which is there for transparency, I believe, and accountability — I need to know the rationale for this and then what the options are for anyone wishing to scrutinize, rightly so, the government expenditures.

Hon. M. de Jong: A fair question. I think we've established via section 9 that the costs authorized by this are restricted to the transactional costs for the agreement and the legislation.

Section 10 exists for the following reason. We would not have known — did not know, actually — when the negotiations began, how they were going to be resolved or what the final cost was. Therefore, no specific funding…. The member and I did the estimates last year for 2007-2008. He'll recall that we didn't include an appropriation or provision that would cover the cost of this agreement — didn't know we would have an agreement.

What we are doing — and this works in concert with section 9 — is that there is a statutory appropriation. I'll tell the member that the absence of section 10 would only mean this. We would still fund the agreement, by virtue of section 9. All of those costs will be disclosed via the public accounts system. But the minister — me — then would be in a position where, for this fiscal year, we would have spent more than the amount that the member and I discussed through the estimates. Therefore, there would be a sanction imposed on me as the minister for having done so. This section excuses the imposition of that sanction.

S. Fraser: Thanks to the minister for that. The minister has answered, I guess, where I was going, question-wise. I wanted to know how that would relate to, among other things, a bonus.

I understand what the minister is saying, but under the pretty blanket statements of section 9, the minister can spend…. Well, it doesn't say. It says any amount, really, from the consolidated fund, under the blanket statements of section 9, and still be in budget. Like the whole idea of the…. Doesn't that fly in the face of the ministerial accountability act? This is very open-ended. There are no numbers. There are no ceilings. The statements for the criteria for spending are very broad and blanket statements.

So again, how do we even pursue this in estimates — the normal processes that we have to deal with this? How will we be able to deal with this? How will I as the critic be able to deal with this? Again, how does the minister reconcile this with the spirit and intent of the ministerial accountability act?

I'm not saying this in any way that suggests that he's going to go to town and spend a whole bunch of money that he's not supposed to spend. But the way this is laid out, by all appearances, you could. It's very broad. There are not very many tight constraints here.

Hon. M. de Jong: I think it's only the last part of the member's statement that I probably disagree with. If it were, as the member is suggesting, open-ended, then I think it would be problematic. Then I think it would fly in the face of the rigour that we are trying to impose on the budgeting process.

But in the same way that I tried to offer with respect to section 9, the only authorization that this statutory appropriation relates to is specific transactional costs, and they must be accounted for. I can assure the member that, through the budgeting process and ultimately the public accounts reporting process, they will have to be scrupulously accounted for.

As I have indicated, insofar as we did not know, at the time we discussed the estimates for 2007-2008, that we would be in a position to conclude this agreement, we did not make provision.

So in those circumstances, had we been of the view — I think the answer to the member's question is — we might have had a discussion, because the member would have looked at that portion of the budget and said, "Hmm, I wonder what that money is for," and I would have offered an explanation. It gets tricky, because of course you're dealing with negotiating mandates that you may or may not want to disclose too early in the negotiating process. It gets tricky that way.

Then subsequent to that, the member would have cross-referenced and said: "Well, I wonder where the minister and the government came in around that, or whether an agreement was negotiated at all."

If it were as open-ended as the member is concerned it is, and I'm suggesting that it's not, then I would appreciate the point he's making. I am trying as best I can to assure the member that it is not open-ended, that the only expenditures being authorized and captured by sections 9 and 10 are those which specifically relate to giving this agreement and this act effect.

S. Fraser: I'm not overly comforted yet, because I and the public still have a very limited written statement about limits or guidelines of where the money is. I think it's always of concern when you're seeing a ministerial accountability act waived. It does require this sort of scrutiny — maybe less so if we're not seeing this trend towards losing our ability also in estimates, timewise. We've seen, again, another instance where we've had, arguably, close to 60 hours of our estimates process removed by some pretty arbitrary changes that used to be done by full agreement of both sides of the House.

So when you combine that with waiving of ministerial accountability acts and pretty blanket statements…. It's the combination. I mean this with no criticism to the staff that negotiated this. I'm sure there's good rationale for it, but the combination of all these things does leave the appearance of something less than total accountability and transparency.

Certainly, when you consider our more limited ability through the estimates processes, through initiatives taken by this government to restrict that — our access and our time as the opposition to do our job in the estimates process…. It's that combination that certainly raises concerns for me and will for others, I'm sure, too.

S. Fraser: The act "does not apply to an expropriation under the Musqueam Reconciliation, Settlement and Benefits Agreement Implementation Act." Could that be explained for me? To me, that seems almost like a redundant statement, so I just need some clarification on it. If you could put that into layman's terms, I would appreciate it.

Hon. M. de Jong: I've just, fortunately, been reminded. I wonder if the confusion is the same one that I had when I re-read it quickly.

This is the phrase or the language that would be included in the Expropriation Act. So moving forward, following the passage of this bill, within the Expropriation Act will be that statement: "This Act does not apply to an expropriation under the Musqueam…." And that's how we ensure that the transactions occur via the provisions of this legislation and not the Expropriation Act, as the member referred to earlier.

Just for further clarification, will we see the Expropriation Act, then, brought forward also subsequent to this?

Hon. M. de Jong: I move the committee rise and report the bill complete without amendment.

Bill 12, Musqueam Reconciliation, Settlement and Benefits Agreement Implementation Act, reported complete without amendment, read a third time and passed.

Hon. M. de Jong: I call committee stage of Bill 9, the Prevention of Cruelty to Animals Amendment Act, 2008.

The House in Committee of the Whole (Section B) on Bill 9; K. Whittred in the chair.

S. Fraser: Thank you to the minister for bringing this forward. Welcome, staff person.

On section 1, the changes here are certainly critical. The wording seems quite small, but it makes a major difference in the ability of the BCSPCA to do their job and protect animals from suffering, in this case.

For me, where this rings out is certainly in automobiles and cars in the summertime where we see animals…. Previously they were having a hard time actually getting to the animals and legally having access to them before they were, in some cases, beyond help. So I think this was a long time coming.

I guess the question to the minister…. I thought I heard him say this has been two years in the working, or maybe it was the SPCA. But can the minister…? With these types of issues — certainly the one we're dealing with, section 1, the amendment…. How long has this been in the works for?

Hon. P. Bell: I will just take time to introduce Mark Parsons, who is with my ministry and helped work through the development of this legislation with the BCSPCA.

We first started working with the BCSPCA when they approached us about two years ago on this particular piece of legislation.

S. Fraser: Thanks to the minister for that. I didn't have a chance on second reading — I was not here — so I just want to say that this is a bill that will be supported by the opposition. As the lead on this, I am happy that this is coming forward.

I have a question, though. It is two years, and that's fine. Why so long? I've tried to look back in records. I've gone back, I think, as far as 2001. I just haven't gone back further than that. The BCSPCA has been lobbying for changes like this, for beefing up the legislation to give it some more teeth and allow them to do their jobs. That has been happening…. I found it back to 2001. Why the lag time there? The last two years — that's good, but what about the other five years? What happened there?

Hon. P. Bell: What I can tell the member is that when we first engaged with the BCSPCA, they advised us that their expectation was for a 2008 legislative session and that they were hopeful that could be achieved. We have more than met that objective by tabling and, hopefully, passing this legislation in this session.

It does take time to go through the process. We wanted to work with the BCSPCA in detail in the development of this legislation. They were very much engaged in the process. Mark Parsons, who's with me here today, met with them on an ongoing basis, and we think we've got a piece of legislation that makes sense here for them.

S. Fraser: I appreciate the minister's answer. I certainly appreciate the work that has gone into this and where it's leading us. These legislative changes, I know, in that exploration of the past, have been supported since 2001 or before — I'm not sure; I didn't go back further than that — by the opposition. So I don't think you're going to see a lot of controversy from this side of the House on it.

Along with this very simple wording change that makes a significant difference, I've got, I guess, a technical question. When it comes to rescuing animals from…. I'll use the example I used previously. It's a change because of the "ventilation" statements made here. Officers from the SPCA will be accessing personal vehicles to, hopefully, rescue animals that very negligent owners have left in there to overheat and, potentially, die. Is it anticipated, with this change, that there will be more acquisition of animals and/or more charges being laid?

Hon. P. Bell: The BCSPCA has had the ability to enter vehicles for some time now in the event of the animal being in critical distress. The issue that has been resolved here is the definition around "distress." I

wouldn't suggest to the member opposite that the BCSPCA would necessarily be entering more vehicles, but it gives them, to enter the vehicle prior to the animal being virtually on death's door…. Hopefully, they will be in a position to recover the animal when it is in better health and bring it back to reasonable health prior to that "critical distress" definition being reached. That was the objective of this particular amendment.

S. Fraser: Thanks to the minister. On that, physically, how will this be done? If you get up to a car, authorization to…. Obviously, the SPCA officer will not have a key. Presumably they're permitted to, if necessary, under the law, get in by whatever means? I've been a volunteer firefighter. It's not very hard to pop a window. Is that what's anticipated here?

Hon. P. Bell: Normally the BCSPCA would work with the local police force in the event of a forced entry of that nature. The tools, obviously, would vary depending on the type of vehicle. I don't have any particular expertise with opening locked vehicles, so I'm unable to enlighten the member opposite on how one might perform that entry. Perhaps he could share some strategies he's aware of. I don't know.

S. Fraser: I don't want to discuss my sordid past. I worked for a rent-a-car company as a kid. I know how to get into a car. A window is very easy to break — a screwdriver just tapped in the right spot, and the windshield will disintegrate. There are ways to get in.

I'm curious about the legislation. I didn't see it here, but is there any accommodation for the public? If you or I were to come across a situation where you're seeing an animal obviously dying, in distress in a vehicle…. Any thoughts on how that might be dealt with, if this legislative change has any effect on that?

Hon. P. Bell: No, this doesn't apply to people who are not BCSPCA officers or police officers in the event it's in a location where the SPCA does not provide service.

S. Fraser: Anticipated cost implications from this change. I guess enforcement cost is what I'm looking at here. I think it opens the door for more potential charges to be laid. There are certainly costs associated with that. Any change you make here is really only effective if there are some budgetary considerations that go with that.

Hon. P. Bell: We're actually jumping a bit ahead here, but perhaps it will resolve having to answer this question. In section 9 of the amendment, which refers to section 20 of the actual act — it's amending the actual act, section 20 — it allows the BCSPCA for the first time to recover costs for bringing seized animals back to health.

This is a first step, and it allows the BCSPCA to recover their costs in the event that they do occur. This is something that was very important to the BCSPCA.

S. Fraser: Thank you very much to the minister for that. Should I wait until that section? How will costs be…? We can deal with it as we get further on, probably, and there's a number of sections here where the same question will apply. Maybe it will be more expedient for me to just wait for the later section here.

Now, obviously, Minister, your staff has been working with the SPCA closely on this. The legislation is important for them to do their job. It's important to protect…. I think we all have a responsibility, in a civil society, to ensure that suffering — cruelty to animals — is prevented, and if it's not able to be prevented, that appropriate action is allowed to be taken. These changes are certainly helping the SPCA do that job.

BCSPCA has been around for a long time, over 100 years, so they know what they're talking about. They've also been talking about…. There is a very cruel way of dying for an animal — mostly domestic animals, but not exclusively; wildlife and farm animals and such too — and that's by coming in contact with, in some cases, antifreeze. It is probably the cruellest way to go for an animal. Essentially, a teaspoon will eat a cat's kidneys out in a few hours, while it's conscious. The same happens with dogs in small amounts.

The SPCA, I'm sure, has raised this, and certainly you've heard it in this House. I'm still submitting petitions, and other members are submitting petitions, also, around antifreeze and trying to protect against that horrible way of dying, which happens, according to the BCSPCA, to thousands of animals every year in the province.

Was there ever any anticipation? I raise this because in section 1 of the act itself, there is potential room for consideration and acknowledgment of this problem as it affects the suffering of animals.

Hon. P. Bell: I respect that the member has brought this issue forward to the floor previously, but the BCSPCA did not flag this as a possible amendment for this particular act. I understand that it maybe would be possible in a different act, but it was not one of the topics of discussion that was raised by the BCSPCA in their consultations with them.

S. Fraser: Thanks to the minister for that. Regardless, it is an issue that they have taken a major role on, a lead role in the province. For anyone who goes to their website, it figures very prominently there.

Their attempts at education for the public on this have been valiant. They have failed to address the issue, and it continues to be one of the most…. I know the American SPCA have done more work on this statistically, but one of the prime, I think, most prevalent cause of death — and a suffering death it is — for companion animals is ingestion of antifreeze. It's everywhere in society.

There are safe alternatives. They're relatively cheap. I've certainly done a private member's bill which has not been successful. I'm going to sit down because I'm finished with section 1. I will be proposing an amendment immediately following section 1. I'll go on notice now.

S. Fraser: I propose an amendment. I move an amendment by adding a new section to the bill. That would be section 1.1.

The Chair: Members, I think we'll continue while we're getting a copy of the amendment made for the minister, if that's agreeable.

S. Fraser: Every year thousands of companion animals die a horrendous death by coming into contact with ethylene glycol–based antifreeze. Ethylene glycol is the prime ingredient in most antifreeze used in the province and, for that matter, on the continent. It is, in its own right, an attractant for animals. When animals come in contact with an antifreeze spill — whether it be a leak; whether it be somebody doing home garage work, automobile work; whether it's from an accident; whether it's from improper disposal — ethylene glycol will be consumed by the animal.

Cats and dogs I'll talk about first. It takes almost nothing. This is a very, very toxic substance, and it has poisoned hundreds of children too. It's very, very dangerous. But it's dangerous especially because a teaspoon is all it takes to kill a cat. A cat just has to walk through a puddle of it from your car that has a leaking hose. It will lick that off of its paws, and that antifreeze will hit the animal's liver, which will attempt to deal with it. It forms oxalic acid, which immediately attacks the kidneys of the animal, causing it to die in a very horrible way and very, very quickly — in hours.

This issue is fully supported by the BCSPCA — to move away from this dangerous form of antifreeze in favour of propylene glycol–based antifreeze. It's very similar chemically, but the product does not taste like candy. It's not an attractant, and it is not anywhere near the toxicity that we're talking about. It would prevent immediately the horrendous and agonizing deaths of thousands of animals a year in the province.

The statistics on this are woefully inadequate. It does not include the animals that have not returned home and, therefore, have never received the benefit of a veterinarian's analysis. It doesn't include what happens to feral cats, and it does not include what happens to wildlife, farm animals, fish and ducks.

It's a major problem that the BCSPCA, who we are listening to here and bringing a bill forward here…. It's based on their advice, and their advice is to proceed. I think the simplest way is to acknowledge that it is a problem. There is no more agonizing way — I'm going to repeat that again — for an animal to go than to ingest this stuff.

Any substance this widely used in our society that is a highly toxic substance, that is everywhere, that is its own attractant for animals, for people…. I have had people contact me who have had their adult children die from ingesting this by mistake — because they had a Mountain Dew spiked, in one case. That's relatively rare, but the incidence of poisoning with children is not.

This is a tasty, sweet, deadly combination. The canary in the mine shaft on this one is our companion animals. Dogs will chew the lid off of the plastic container of this stuff that you can get for $12 at Canadian Tire. It will kill them, and it will kill them quickly, before you even know it.

Having this recognized in section 1 of the act — having this amendment in the act and having the bill reflect it — is a friendly amendment. I say that it's a friendly amendment because it is, for the first time, bringing some official recognition under legislation that this is a problem. It will help lead to the solution, I hope. I urge all members of this House to support this friendly amendment.

Again, this is supported by the BCSPCA. They've had a major campaign on this for years. Tens of thousands of individuals in British Columbia have sent in petitions, have signed petitions, have sent in letters to the Minister of Environment, to the Premier's office. This is widely supported. It's supported by the Sierra Club. It's supported by the Western Canada Wilderness Committee. It's supported by the Pacific Assistance Dogs Society. It's supported by all major environmental groups and, of course, those that know the most about suffering and cruelty to animals, the BCSPCA.

Incorporating acknowledgment of the dangers of ethylene glycol–based antifreeze is essential, because it is about cruelty. I note that in the definition portion of the bill, there is no definition of cruelty or cruel. I'm surprised, because "cruelty" is actually incorporated into the name of the act, which is appropriate.

I went to Webster's as a fallback position. Cruel is "causing or conducive to injury or suffering, grief or pain." That's it. That's what happens when animals are exposed to ethylene glycol–based antifreeze. And propylene glycol–based antifreeze, which I have in my car, costs $3 more a gallon.

I understand that members — probably from both sides of the House, but certainly the government members — have been lobbied against this. They've been lobbied by industry, who claim things like, "There is no evidence that antifreeze causes death," which is a foolish statement by industry and is patently false. They also state spurious arguments such as, "We'll have to

set up roadblocks at the borders to stop cars and drain the antifreeze out," and that is a spurious argument.

We need to move ahead on this. The BCSPCA is demanding that we move ahead on this. I haven't got any formal response from the Minister of Environment, except initial acknowledgment that this was an important issue. This is a bill that's coming forward now through the BCSPCA, dealing with cruelty. This is an issue about cruelty, by the definition of cruel.

Hon. P. Bell: I appreciate the member opposite's passion over this issue. Clearly, he has very, very strong feelings, as do many people. I just wish to point out a couple of things to the member opposite.

He was referring to that there is not a definition of cruelty in the act. Actually, the act refers to distress. The definition of distress is actually the definition that's used, and that's why that model is currently used.

The member opposite also referred to examples where humans have ingested antifreeze and, as a result, passed away from that ingestion. Putting this amendment in this particular act would not resolve that issue. In fact, it would not resolve the issue of this particular type of antifreeze being sold into the public.

I do know that my colleague the Minister of Environment has been investigating this issue, and I know the member opposite has a keen interest in it. I would suggest that the member opposite speak with the Minister of Environment on this issue.

An amendment of this nature would not, in my view, be appropriate in this particular act, although the notion of looking at a model for dealing with antifreeze issues going forward is certainly something that I think everyone is interested in. For the purposes of this act, we don't think this amendment would make sense.

However, we're certainly willing to work with the member in terms of advancing the overall issue. It is one that is important to many people.

R. Sultan: I'm delighted to have an opportunity to talk to Bill 9 in general terms, just to give you a very brief preamble. Section 2 of Bill 9 is a fairly technical clause, and it really explains my involvement in this act in the first place.

My attention was first drawn to the inadequacies of the existing act by a friend of mine, chartered accountant Andrew Williams. He had pretty much on a volunteer basis gone to work for the SPCA British Columbia organization to resolve some serious accounting issues that had taken quite a long time to address. He discovered that the way the act was written and the way company law and regulation in British Columbia had evolved, it was in fact legally impossible to comply with the registration requirements of this government — in particular, as the amendment points out, the registrar of companies — within the strictures of the existing act.

I might point out in this regard the peculiarities of the Society for the Prevention of Cruelty to Animals. It is a private society funded in the main by individual contributions, typically by people concerned about cruelty to pets and small animals. But of course their responsibilities extend far beyond that to all animals in the province, including these bustling and very vibrant commercial beef cattle, sheep and other animals grown commercially.

So we had a kind of bifurcated organization here funded in the main by…. Well, I hate to use any stereotypes, but shall we say funded persons like me, concerned about my pet dog. Many of their enforcement officers were out in the field endeavouring to maintain standards of humanity in the treatment of farm animals. So that was one problem.

Mr. Williams came in and, I think, resolved many of the financial and reporting issues, reporting to the new president who came in and provided leadership in this regard. I just want to acknowledge the work that Craig Daniell, the new CEO, did.

The funding issue nevertheless remained and remains to this day. The peculiarity of the organization and why the government is properly concerned about the structure of this statute is that by law, they have been charged with what we might call police duties. It is almost as if we had the RCMP in British Columbia funded by private donations but charged with the enforcement of criminal law. That is a bit of a stretch, but there are some parallels to the peculiarity of the situation. That's why the proposed amendment in section 2 is so important.

I could go on and talk about the other sections of the bill. It would not be appropriate for me to do so. Clearly, the enforcement improvements embodied in this act are also measures that the SPCA has been asking for, for a number of years. I would commend the minister in the fashion in which he has responded to virtually — not 100 percent, but virtually — all of the needs of the society — in a very appropriate fashion.

I would also congratulate him on that wonderful demonstration with the dogs on the front steps, which we all enjoyed so much about a week ago.

My question to the minister is: in terms of section 2, are you confident that the accounting dilemma that my friend the chartered accountant Andrew Williams had — namely, he could not submit a proper set of accounts that was certifiable and acceptable to the registrar of corporations and at the same time operate within the act…? Has that government- and regulatory-created dilemma been solved?

Hon. P. Bell: I would just like to acknowledge that the member actually had flagged this some time ago to my office and requested that we look at how we could correct this issue. So his initial identification of this problem is what led to this particular section of the bill.

I am told by the registrar and by the accountants association that we have met the need for the SPCA to be able to fulfil their obligations. I appreciate his work in bringing this forward as well.

S. Fraser: On the section on abandoned animals, I see the amendments include "is apparently ownerless" and "is found straying." These are fairly subjective statements, I understand.

I'm presuming that if an animal is seen wandering, that's the discretion of the BCSPCA. I mean, if there's an animal that has come out…. If your gate was left open from the back yard and the animal is in your front yard, is that anticipated to be covered in this?

Hon. P. Bell: It is a discretionary authority that the BCSPCA has, and it makes decisions as would other law enforcement officers in terms of the nature of whether or not this particular animal was straying.

S. Fraser: Subsection (c): "…is found in a rental unit after expiry of the tenancy agreement in respect of the rental unit." We're presuming that the tenant has left and has abandoned the animal. The whole section is about abandonment.

This doesn't allow for if the tenant is still there at the end of a tenancy agreement. There might be a dispute, but we're not talking about taking the animal from a tenant who is present?

Hon. P. Bell: If the tenant was actually still occupying the property and the animal was in distress, then the SPCA would act under the distress provision. But if the tenant is still occupying and the animal is not in distress, then they wouldn't be seizing the animal.

S. Fraser: Next section: "(d) if a person agreed to care for the animal, is not retrieved from the person within 4 days following the end of that agreement." I'm curious about this. It's quite specific — four days. I just don't understand how it is supposed to be interpreted.

Hon. P. Bell: The principle behind this was if someone were to leave an animal in the care of an individual for an extensive period of time. Previously that individual was obligated to continue to care for that animal.

This section allows the BCSPCA to step in. Four days was seen to be a reasonable amount of time past the period that the individual had agreed to look after that particular pet. But of course, if the owner were to call and identify by phone and there was ongoing agreement to look after the pet, then the BCSPCA would not necessarily step in.

S. Fraser: Thanks to the minister for that. So this section on abandonment — is it consistent with other jurisdictions, other provinces?

Hon. P. Bell: Yes, it is. In fact, it's modelled after the 1999 amendment to Alberta's legislation.

S. Fraser: Thanks to the minister for that. Just closing off this section…. This may be dealt with later. I'm sure we will. There are certainly cost implications with this section. Any changes made here may, indeed, increase the ability of the BCSPCA, rightly so, to be able to acquire and take into care abandoned animals — which we all approve of, and I applaud this — but there are cost implications for that.

I'll ask the minister now so that I don't miss the opportunity later. Will there be a point where we can address that question in a larger context?

Hon. P. Bell: That would be bill section 9 and, actually, section 20 in the act, when we get to that.

R. Sultan: This section, as I understand it, allows an authorized agent of the SPCA, where it is impractical to appear personally before a justice, to apply for a warrant by telephone, swearing an oath by telephone or by some other means of telecommunication.

Could the minister clarify for us the circumstances under which this revision to the act would be helpful in the cause of protecting animals in this province?

Hon. P. Bell: In fact, the BCSPCA had a circumstance where the location they were attending and reviewing the potential seizure of animals was in a very remote location, and they had to travel, I believe, in the order of eight hours to get to a place where they could swear a warrant in front of a justice and then travel back.

Fortunately, the animals were rescued and were saved in that particular circumstance, but they flagged this as a significant issue and one that they wanted dealt with. So that would be a good example of where this particular section of the act would apply.

R. Sultan: I suppose a parallel might be to find in a car an animal which was becoming overheated eight hours from the justice of the peace. Would that be a parallel situation?

Hon. P. Bell: Actually, likely that would be a critical distress situation, where a warrant would not be required for entry, and they would work with the local police detachment to enter the vehicle.

S. Fraser: There is a series of amendments in this section that deal with fines and levying those fines. I'm curious about the proceeds of these fines. Once they're levied, where would those moneys go?

Hon. P. Bell: They continue, as they have in the past, to go into the consolidated revenue fund.

S. Fraser: Was there any discussion about whether or not some of the proceeds of these fines could be used as maybe core funding…? I guess it wouldn't work as core funding, since it's a transient thing. Did that come up in the discussions with the BCSPCA?

Hon. P. Bell: No, there wasn't. I think everyone should at least understand that there would be a potential for a deemed conflict in the event of fines going directly back to the organization that placed those fines. No, it wasn't an area that was talked about.

S. Fraser: I appreciate that, and I agree with the minister's statement that it would be inappropriate. Just the perception would be inappropriate.

I'm just curious as to how this works. The decision of whether or not to fine or how much — is that now definitive, or is it something that there's a subjective nature there? If so, how would that be applied?

Hon. P. Bell: The courts make that decision. Typically in the event of a first offence it might be on the lower end, depending on the nature of the offence. But there is the flexibility, even in the event of a first offence, to have a fine of up to $5,000 per animal or per event. So it is a multiplier and could be a very large fine in the event of a situation we saw recently — as an example, in Surrey — or an alleged situation.

S. Fraser: The minister is actually touching on something that I'm going to go to now. In the instances of inhumane treatment in puppy mills — that sort of thing — where you've potentially got a large number of animals being exploited and/or abused and caused to suffer for crass financial gain, would this section apply?

Hon. P. Bell: Yes, this would apply to the situation the member describes, and the multiplier impact of the potential fine would also apply in that event.

S. Fraser: Based on the multiplier effect of this, which could potentially be quite high, especially when we're talking about a lot of animals in that case…. It could be litters of puppies or whatever. Is there any ceiling anticipated through the act or through any of the changes?

Hon. P. Bell: No, there would be no ceiling. But of course, the courts would ultimately make that decision, and Crown counsel would advise on its recommendation for what would be appropriate in that individual case.

S. Fraser: Is this done in conjunction with the RCMP? I don't see any changes here, so I guess I'm asking: will some of these actions continue to be done with the assistance of the RCMP or the local police force?

Hon. P. Bell: No. The BCSPCA act like the RCMP in this area, consult with Crown counsel and work with them in terms of the development of charges. The RCMP or the local police force, depending on where it is, isn't necessarily part of the process. If they were involved in the seizure, if it was a very large seizure like we saw in Surrey, clearly it would be a collaborative effort.

S. Fraser: Thanks to the minister for that. He's answered part of the question. I guess where I was going with this is…. You've got a substantial increase in the potential penalties that can be levied. In theory it could be quite substantive, and that is a good thing.

That being said, BCSPCA enforcement officers are not armed, and desperate people do desperate things, and the stakes have been raised here. Has there

been any anticipation with the changes of this in the interests of protection and security for the BCSPCA personnel?

Hon. P. Bell: The BCSPCA have a very good working relationship with the local police forces already, be it the RCMP or a municipal force, and it is quite common practice for them, if they have any concern with regards to a situation that they may be entering into, to bring the RCMP with them. That is common practice that exists today and will continue into the future. I'm sure that they take all due caution when moving into what could be potentially dangerous events.

S. Fraser: The amounts decided on for the increases in fines — are these consistent with other jurisdictions?

Hon. P. Bell: It is with the exception of Alberta. Alberta has a higher fine level.

S. Fraser: With another section here…. We're dealing with enforcement throughout this entire bill, and there are more teeth given to the enforcement regulations, which have been called for by the BCSPCA and, of course, by and large, by the public too, which we've seen with outrage in some of the incidents we've seen recently — from the public we've seen that outrage. This is, I think, in keeping with that.

I'm going to touch on funding again. The core funding for the BCSPCA — is it going to go up as a direct result through the budgetary process? Will it go up to accommodate…? I think some of the needs were not being met through core funding anyway, so this is going to increase the potential work for the BCSPCA.

It will only be effective in its enforcement and its deterrent if it has the ability to actually do the work, and there's more work now. They'll be able to do more and a better job, but only if they have the resources to do so.

Hon. P. Bell: I just, maybe, want to start out by saying how impressed I am with the BCSPCA and the services that they provide and their ability to raise funds. In fact, as I understand it, at least the last two years if not the last three, they've had a surplus at the end of the year, which just speaks highly to the passion that British Columbians have for looking after their pets. I understand that they have in the order of about 80,000 individual donors every year. It's just a remarkable organization.

The point that the member touches on around core funding is something that we've been working with the BCSPCA on. We have not found resolution to what it is that they're looking for, but we continue to work with and meet the BCSPCA, and I'm hopeful we'll find an opportunity to meet their needs. But I will just remind the member that, certainly, for at least the last two years, if not the last three, they've been operating under a surplus — the BCSPCA.

S. Fraser: I am a contributor. I take part in fundraising activities. I hope other members in the House do. I also have family members that volunteer with the BCSPCA. Delores takes care of the bunnies at the Oceanside shelter.

I don't want to understate just how important it is for public involvement in the work that the BCSPCA does, whether it's through volunteer work, which actually is an in-kind donation, if you will, or actively taking part in silent auctions or walkathons, eating a whole bunch of chocolate, sponsored by A-Channel, or whatever. There are all kinds of creative ways that the BCSPCA have been able to find a way to do their job in B.C. I applaud the BCSPCA for that. I also applaud all those volunteers that do that work and the donors too.

That being said, you know the efforts to fundraise can be quite time-consuming. It is, potentially, a distraction from the job, and I'll use the analogy of if the RCMP had to rely on donations or fundraising. You know, there are good years and bad years, and the protection of animals against cruelty should not be based on a good or bad year of fundraising.

I wonder: has the minister looked at other jurisdictions when it comes to potential funding arrangements with the BCSPCA? I'll go specifically to Ontario, because I'm aware of some of the numbers there.

Hon. P. Bell: I will just, perhaps, add to the minister's comments and say that the BCSPCA does have an incredible advocacy organization.

In my remarks on the stairs of this wonderful building, I had commented that their advocacy group had infiltrated all parts of British Columbia. There were no reaches that they had not been able to delve into. Even the Bell family had been infiltrated. My two daughters are strong advocates for the BCSPCA. I think I'm allowed to say the Bell family. Now I've said it twice, so hopefully, I'm not completely out of order here in saying that. Yes, a very strong advocacy organization, and they do a great job.

We have been working actively with the BCSPCA on considering funding models. I'm not in a position to talk at any greater length about that at this particular point in time, but I'm aware of the concerns that they've expressed. I'm aware of the funding models across Canada and the opportunities, and I am hopeful that we will find something that makes sense for the BCSPCA.

S. Fraser: Thanks to the minister for that. I appreciate the minister's support. I believe this is and should be apolitical. It's about doing the right thing. We have a responsibility in society to take care of people that need help and of animals that we take under our care. There is a responsibility that goes with that.

Not everyone understands that. Sometimes it's ignorance, but having a body like the BCSPCA to make sure that, even through ignorance, the animals don't have to face the brunt of the suffering that that can cause. For anyone who has got a cat, a dog, a hamster, a fish or a rabbit, they become a part of the family. There's an emotional bond there, and the loss of an animal is a real loss. Certainly, I've gone through that, and many of us also have.

I want to get it on the record. How much do they get in Ontario? How much does the Ontario SPCA get in funding from the Ontario provincial government?

R. Sultan: Just to comment on the member's kindly received observations on the act and again referring to my earlier remarks, I would not underemphasize the importance of being able to submit to potential financial donors and supporters of the BCSPCA the fact that we now have regularized, accepted, authorized, qualified financial statements filed with the registrar.

It's vital to the continuation of their very strong and successful fundraising efforts. I think the minister deserves credit for having gone out of his way to modernize this bill, which is so important to so many people in our province.

My last word on this subject, and then I will sit down, is that Craig Daniell at the doggie demonstration we had on the front steps, which I referred to earlier, commended the government on the modernization features that they had requested and which had, by and large, been incorporated in this bill.

Hon. P. Bell: The member for Alberni-Qualicum missed one particular species of animal that I think needs to be referred to as well, and that would be the guinea pig. They have a long and sordid tradition in the family. He mentioned hamsters and a number of other various animals. I just thought I needed to get that on the public record so that my daughters would allow me back into the household.

I am advised that the Ontario SPCA has received $119,000 per year historically from Ontario. There was a one-time grant in '04-05 of $1.8 million, and I'm advised that they have made a commitment to go to $500,000 per year in Ontario. I gather that's starting in the next year or two, but I don't know the exact date.

The province of British Columbia provides and has provided funding of $325,000 per year.

S. Fraser: Thank you to the minister for that. I see that if they were working in the 300 range and Ontario is looking at the 500 range, I would suggest that we don't want to shortchange the BCSPCA in a relative fashion here. I know it's not a competition.

The minister commented that there's been showing some surplus there, and that's wonderful. But I have been told that there are gaps in the ability of the BCSPCA with their resources that they have today to do their job. Obviously, they've been soliciting the minister in that regard.

Some of the gaps are regulatory and some of it, I think, is best addressed through core funding that ensures that…. Yes, there can be contributions and probably should be contributions from the public because they care. Again, the protection of animals in the province should not be based on the ability of the organization involved, successful as they historically may have been, to secure money from donations. They're playing a role that has to be played.

If the BCSPCA disbanded, that role would…. I think it would be incumbent on the government of the day to fill that role. They would be required. If the BCSPCA just packed it in and said, "Look, this is too difficult. We don't have the resources to do this," government would have to take up that slack. It would be a responsibility that I think would be necessary, and the public would demand it.

Whether it's a legislative requirement, I don't know. But I suspect it would be. The laws are still in place about cruelty. Somebody would have to enforce it. Somebody would. The RCMP — well, they're already stretched pretty thin. We're seeing the need for more police officers, and they have expertise in other fields.

I am hopeful, based on the fact that we've got, I think, a good bill here. I applaud the minister for that, and I thank him for working with the BCSPCA. But, you know, heed their needs for funding that comes in a way that will free them up from some of their fundraising requirements to perform their job, which has taken them away from their job to some extent. Then I think we'll all be better off for it.

Hon. P. Bell: I move that the committee rise, report the bill complete without amendment.

Bill 9, Prevention of Cruelty to Animals Amendment Act, 2008, reported complete without amendment, read a third time and passed.

Hon. C. Richmond: I call committee stage of Bill 10, intituled Housing Statutes Amendment Act, 2008. The hon. Minister of Forests and Range and Minister Responsible for Housing.

The House in Committee of the Whole (Section B) on Bill 10; S. Hammell in the chair.

D. Thorne: I have a couple of questions on section 3 for the minister. I had brought them up in the second reading around building applications possibly going — the inspection not being provided by the cities. The qualified professional expansion, including architects, engineers and geoscientists…. Does this, in fact, allow a city to, more or less, do less inspection or bring in bylaws to do less inspection where they did not have that ability before?

Hon. R. Coleman: This actually doesn't make them do anything. It actually allows them to do it. So they can now create a bylaw giving them the authority to acquire specialists designated by the Architectural Institute or the professional engineers to sign building plans.

Really what it does is…. This section provides local governments with bylaw-making authority to require that building plans in certain circumstances be certified by a professional engineer or geoscientist or architect. The expertise on the architectural side that we expect to see as we go forward in complex building areas will probably require some specialized expertise. It gives local governments a greater assurance that if they want to require that, they can, in the building-permit process.

Right now in some jurisdictions they already do certified professionals. Particularly in Vancouver, you can hire the certified professional, which jumps over the local building permitting. They actually allow them to do the building permit and inspections, because they're certified as being qualified to do the job and the city recognizes that.

D. Thorne: Thank you for clarifying that — that it doesn't mean they have to, but that they can. That's actually where I'm going with this. Does this take us down the road one more step toward where a city — not necessarily Vancouver, because their rules are different than the other municipalities, but, say, outside of Vancouver and/or Vancouver — is not doing inspections on residential or commercial properties?

For instance — I'll use my city as an example — in the city of Coquitlam, when an inspection has to be done on a specific part of a building phase, will a homeowner at some point in time be able to use only a qualified professional, at which time the city would not be responsible for inspection, and that qualified professional would, in fact, sign off on it? I don't even know what to use for an example — plumbing. I'll use that for an example, or wiring.

If this qualified professional signs off on it, then I'm wondering where the liability lies. Is the city, then, no longer responsible to the homeowner if something goes wrong down the road on a particular inspection that's been done privately? I'm thinking beyond….

I know that some qualified professionals are being used in all of the cities, particularly around environmental issues and stream setbacks, and all of those kinds of issues. I know that in Burke Mountain, the new development that's going on out there, which is a huge development…. It's apparently the second largest ever in the history of British Columbia.

I know that there are lots of qualified professionals now, environmental techs and that, working out there. There's even a new course at one of the community colleges here on the Island for people to take to become a qualified environmental technician.

I'm just wondering: does this section take us further down the road toward the cities getting out of the inspection business altogether?

Hon. R. Coleman: Theoretically, yes. It would depend on what the municipality decides to do with the bylaws it gets to write. This gives them the authority to write them. But I don't think there's much doubt, when municipalities tell us — I mean, even through UBCM and the consultation that took place even getting to this point — that they're more and more concerned to find creation of specialist designations within local governments. They don't have the capacity in their building departments to actually do the inspections that they think they should do, which they think could mitigate some of their liability. Also, there's a piece of the puzzle that's always local government's responsibility, I guess.

They're not always going to have the staff. Most municipalities don't today. If somebody moves into concrete, particularly in a highrise construction in some of our…. Not so much in Coquitlam, because they have some experience with it, but there are communities that don't. They would probably move towards more being interested in having a certified professional do that than their own staff, because their staff probably don't have the designation or the qualifications to do the work.

D. Thorne: I'm not actually meaning to suggest that this is something the municipalities and cities don't want. I was on council long enough to know the reasons why they're interested in moving down this road.

The liability issue is, I think, of a big concern — not so much to the city, obviously, if they no longer will be liable for problems down the road after a final inspection and final occupancy occurs. But these qualified professionals quite often are single individuals who will start their own small business, maybe one or two people or somebody on their own. I'm just concerned about the whole liability aspect, you know. When there is a leaky building or whatever, how does it fit in when the homeowner or the condo owner goes to the city and says: "I'm having problems, and who's responsible for this"?

The city, I assume. If they haven't signed off on it, if the qualified professionals have signed off, will the city be responsible? In the end, they're going to have to be the final word. Are the qualified professionals reporting to the homeowner or to the city? Who will have the final liability? And how will we ensure that we have enough insurance, and those types of things?

Is this going to go through the HPO? Is it going to be part of the warranty insurance program? Are we

going to be starting another new program to handle this, or will the city still be liable financially for problems down the road?

Hon. R. Coleman: The city issues the permit, so they're assuming some liability whenever they issue a permit. That's why they get to write the bylaws to say when they want to require a specialist that has designations. This allows them to have specific designations, engineer and architect designations, which are now qualified specialists. Those guys do carry insurance. They have to carry error and omission insurance like everybody else.

However, the member is walking down a whole larger discussion with regards to a word that probably makes my Attorney General uncomfortable when I talk about joint and several liability, which is an issue that may someday be discussed at a higher level between municipalities and governments, etc. But it's not part of this discussion.

The reality is that anything that gets built in residential today in British Columbia has the new home warranty, or it can't get built. We won't issue it through the Homeowner Protection Office on a residential side.

On a commercial side, the engineers and architects always do carry some level of the costs of the liability. So does the municipality, with their permitting. This allows them to say: "We're prepared to accept this designation as something, as a specialist." If they feel that it's an issue with regards to whether they have a liability issue for themselves, they can make the decision not to pass the bylaw. It's entirely up to the municipality to decide which way they want to go.

D. Thorne: What I'm hearing, then, is that this section, in any case, is more strictly about adding new definitions to the qualified professional; that before, there were a certain number of qualified professionals that would be recognized in a city; that this is just adding architects, engineers, geoscientists to that list; and that I am overreaching on this section when I started to talk about it.

You're right; I am thinking of joint and several. Those are the things that you talk about at city hall these days. It is a real concern and not something that's covered, as far as I know, under the HPO or insurance that might be covered by any of these qualified professionals.

If I'm correct, is there another section in this amendment act where it would be more appropriate for me to talk about liability and insurance issues?

Hon. R. Coleman: No, we're not going to enter into a liability insurance discussion. This act has nothing to do with that today, just so we're clear. I probably shouldn't have brought it up, but sometimes I like to make him shiver a little bit.

This really is, basically — just so we're clear…. It gives local government the authority to write a bylaw to require specialists on certain construction sites. Then they can obviously pass their inspections off to them because they require it as part of the bylaw. They asked for the power to be able to do this. Some will choose to do it; some won't. But it will be up to the municipality to make the choice.

D. Thorne: I'm assuming that rural areas would be covered under this as well. I'm not sure how that will be handled. So that would be one question. How would it differ in a rural area where you have, you know, nobody assigned to these things? Some areas around the province don't even have an active regional district, I know.

Finally, around the liability. My second question, then, would be…. I don't know how we can…. I mean, perhaps this act doesn't include discussion around insurance and liability, but now that we're moving down this road and adding to this list of qualified professions and obviously moving in this direction — certainly in the bigger cities — when will we be getting to talk about the insurance and liability aspects?

That will raise its ugly head quicker than we probably think, once we start giving the ability to hand off inspection to city councils. They will be only too eager, I would suspect, to do this. So the insurance issues are going to raise their head faster than we know.

Hon. R. Coleman: This enables even a regional district to decide if they want to have somebody that is going to be designated. That's what they can do. They can decide not to do that.

There is another body of work going on with more remote districts. The member is right: there are some areas of the province that aren't regulated by any type of building inspection, and there are some concerns around that. We're doing some work on that, but it's not included in this legislation.

D. Thorne: Sorry. I did ask a second question there, and it may not have seemed like a real question. I'm just wondering when…. I know that the minister has said that this is just the first of an enabling legislation — that we're going to have many more in the weeks or months to come, whatever it was — but will one of those steps, and sooner rather than later, actually get into the liability and insurance issues?

Hon. R. Coleman: No, it's not in our purview. We're just dealing with the building code. The building code insurance, which exists in and around the new home warranty and those things today, and the liability that engineers, architects and geosciences already carry today are all in existence. This legislation doesn't affect any of that.

The issues in and around liability are a discussion with either Community Services with regards to Municipal Act, the Municipal Finance Authority, or with the Attorney General, if they choose to bring an act with regards to that. But this is strictly building code stuff.

D. Thorne: Okay, I just want to be on record, you know, as saying that perhaps I'm being extremely

pessimistic, and insurance is, I guess, another ministry. But I can see a scenario happening out in Burke Mountain, which is one hillside after another and watercourses going through almost every single piece of property.

The city of Coquitlam did adopt the streamside protection regulations a couple of years ago, about three years ago, which would have protected the houses being built around those watercourses to a much greater degree than the legislation that has now been adopted.

They have tossed out the streamside protection and brought in the RAR, the riparian area regulations, which are much more closely linked to using a qualified professional rather than the city having bylaws in place around stream setbacks, etc.

I can see a house using a qualified professional. Each one is going to be done individually. You get somebody, and they make a mistake — as will happen in any profession quite often — and somebody's house…. The setback is wrong; they have flooding; or worse, they end up losing part of their bank or part of their house, like we see on TV all the time.

I think that this kind of issue…. That homeowner is going to go to the city of Coquitlam and say: "Half of my house is gone. My bank is gone. Who is responsible for this? Who is going to compensate me for the loss of my land and my house, or whatever happens?"

The qualified professional is a young person who is working on their own and has a designation and is qualified, but unfortunately perhaps doesn't have the coverage for this kind of liability. Is the city going to be, in the end, ultimately responsible? Will they ultimately pick up the tab for that homeowner or homeowners if it happens?

I'm probably more concerned about this than I would be were Burke Mountain geographically different than it is, being such a large development that is just starting now, with potentially at least 30,000 people living out there and lots and lots of single family houses built on these watercourses — and raining all the time out there as well.

I'm not sure that's a question, but I do want to be on record that I think this is an area I would hope the minister would work with. If he isn't the appropriate minister, I hope that soon he will work with the appropriate minister on these insurance issues and joint and several and all of those awful words that give me, as well as the Attorney General, the shivers.

D. Thorne: This is easy to understand. I don't know how simple it is, but it's easy to understand.

I am just wondering if the bylaws that the Professional Engineers and Geoscientists will be enabled to make are only around designating these specialized areas so that they will be working with the cities and just doing that. They won't have any other bylaw abilities that might diminish any municipal powers. I just want to be really clear on that.

Hon. R. Coleman: The reference to bylaw in this section is bylaws within the organization, not within municipalities.

D. Thorne: Thank you. Just one final question there. Who will ultimately be responsible for deciding what kind of education, etc., that certified certificate holders, certified members and licensees would have to hold?

Would it be more or less the college? Would it be the standard educational requirements for a full degree in these fields, with maybe an added educational component to work on strictly municipal issues or green issues or whatever? Or will there be in fact new educational programs now being delivered in the province, where people can take a shorter course than they would have normally had to take and become a qualified professional?

Hon. R. Coleman: You don't get to be a member of the association unless you're an engineer or geoscientist. So you can't just go and get the qualifications by going and taking a course and saying: "Well, gee. Now I'm one of them." They actually set the designations, the training and the qualifications, and you're not going to get there unless you're one of them to begin with. So they're going to be qualified people already, before….

It's no different with the certified professional. When I was in the industry, it was an architect who also took additional training on top of being an architect, so they could be qualified as a CP.

Maybe the first question, and I've had these discussions with the minister previously…. Would it be a fair assumption that the amendments under section 5, here, begin to provide some enabling ability for the minister to deal with situations like the situation around Pandora Street that occurred in my constituency? I know the minister is well aware of it — where a landlord who hadn't conducted himself appropriately in the upkeep and maintenance of his building…. The roof collapsed and put about 50 families out on the street.

I'd like to note at this time that I appreciate very much all the cooperation in that particular instance that I got from the minister over an extended period of time, to help make sure all those people found their way into new and appropriate housing. The minister's office and the minister himself were extremely helpful in making that happen. It was much appreciated by me and certainly by the people who had to find a new place to live.

My question is: does this begin to provide some enabling to deal with situations like that?

Hon. R. Coleman: Yes. It does to a degree, because it does clarify that the B.C. building code applies to building alterations and repairs. That needed to be clarified. At the same time, a couple days ago — more to the member's point with regards to what might be classified in some of our discussions about bad landlords — a regulation was put in place that…. It's now up to a $5,000 administrative penalty for abuse of the Residential Tenancy Act, which can be applied every day from the day forward once the first offence is done.

When we were talking before, it was the issue with the fact that every time you had an issue with one of these, you had to go through the court system, get a likelihood of conviction and all the rest of that stuff — with regards to being able to take that issue to a court. We've now put in place administrative penalties so we can react more quickly on the other side of that coin as well.

S. Simpson: From a point of view of some kind of stick that you use, I think that might make good sense — to have something that doesn't require litigation to get there.

Following up, maybe to understand a little better how this particular change might help to deal with some of those issues, particularly around repair of buildings and that. Is it the intention of this that the minister will be in a position — assuming there are regulations adopted — to be able to order that repair directly? Or would the thought be that the minister would somehow empower local governments — some of whom think they have the authority and might be right, and some of whom claim not to have the authority? I know it's a point of debate, but is it to be able to direct local governments, or directly as the ministry, order those repairs in some fashion so that they actually occur?

Hon. R. Coleman: No. The building code isn't a code designed to come in and demand on inspection. That is more a local government issue and health and safety issues.

What this does…. It makes it that the standard for reconstruction or fixing it has to reach the building code standard. It basically sets the standard, but this legislation doesn't give us the power to do what you described.

S. Simpson: Just to follow that up a little bit, I certainly understand the distinction here. I don't know that this has been substantiated in the case of one of the buildings in my constituency, but the suggestion there was that there were, in fact, at one time, orders given by the local government. There's some question as to whether they were, in fact, followed and whether the work that was directed actually ever got done. The suggestion by some is that the work never got done, and maybe the resulting catastrophe for the building might suggest that that was accurate.

Would this, then, create some kind of situation where those orders could be given and a local government could enforce them? I know that in the discussion I've had previously with the minister around this topic, part of the challenge was to have this be very clear — what the rules are — so that local governments could adopt the bylaws — I assume we might see some of that in section 6 — that would oblige landlords in a given municipality or jurisdiction to actually do this work.

Is it the view of the minister that through the building code changes, you're giving at least some clarity or more stroke to local governments to be able to do that?

Hon. R. Coleman: Yes, I think it does. Basically, the minister's regulation-making authority under the act currently refers only to the construction and demolition of buildings, whereas our legal counsel advised that since the Local Government Act, section 694(1)(a), specifically refers to alterations and repair in addition to construction, the minister's authority in relation to the building code in section 692 may be limited only to new construction or to construction.

This amendment clarifies that and allows us also to say that we match up to their bylaws and the building code now has to apply to renovation. Therefore, they can go and inspect and say, "You have to match up to the building code," and make them hit the standard.

S. Simpson: Once this passes and it's enabled, does the minister have an expectation of what the time line is to actually write those regulations and have them in force?

Hon. R. Coleman: There's no need to write regulations. When this is passed, it's passed. It will come into law. The building code is the regulation, so this one doesn't require another period of time. It will effectively be almost instant.

S. Simpson: It's good to hear that there's not a delay between the passage and being able to apply this. Are local governments going to need to do anything different than they do now to make this work? Once this is adopted, local governments then are going to be able to act, hopefully, on these issues, because there's some broadening of the latitude or the law for the minister. Is anything different going to have to happen with local governments? Are they going to have to do anything different in terms of what they do to be able to apply this law and these regulations?

Hon. R. Coleman: No, they already had the ability. It's a matter of giving us the ability to say we can include this in the building code, and therefore, the building code applies.

D. Thorne: The member asked some of the questions I was going to ask. But I'm assuming then that really, this will bring the municipalities and the province more in sync with one another in terms of their abilities to do these things.

I'm just wondering if perhaps the minister could give me an example of what kind of an exception would there be an ability to create between the provincial government and the way it is now with the municipalities. Right now, it says that all the regulations basically, except for Vancouver, have to be the same. This will give the province the power to create exceptions, and I'm just wondering what an example of that might be. Could there end up being a conflict, potentially, with a city that, say, wanted to demolish or not demolish, or vice versa?

J. Horgan: Colleagues, I'd like you to give a warm and hearty welcome to my son, the oldest of the two Horgan boys, Nate, who has come down here to watch me wipe the floor with those on the other side. Please make him welcome.

I think the member is talking about the alternative, where the minister has the right to provide an exemption to certain persons, including local governments, with regards to buildings, classes of buildings, materials from the building code or regulations, without being required to apply for alternative standards and regulations.

That takes place very rarely, actually. It does take place sometimes on more remote islands and in areas of British Columbia where they might have a local material that may be able to be used in those circumstances, where an exemption could be required without it making it necessary to change the entire building code for that alternative standard.

Those, basically, could take place when people start to apply different things with regards to roof technologies and stuff like that, and with the green building codes stuff as well. But that will be stuff where we would be able to adapt, and that's why that's there.

D. Thorne: Finally, this section also designates an official in the minister's department to do these same things that the minister can do, which, in effect, would give that official, I guess, the ability to make changes to the building code.

I'm assuming, and I think there is something in there, that if there was any conflict between…. I'm not clear if it would be a conflict between a municipality or a city or between the directive itself and the building code. I think that the building code would always prevail. It would be the current building code. Would that be a conflict not just with the directive itself but also with the municipality or the city?

Hon. R. Coleman: Just so we're not confusing designations here. The minister can make issue-binding interpretations of the building code or regulations that would then become the building code. This official doesn't do that. Those are actually done by the minister.

I'll give you the descriptions. Currently there is no authority to interpret or provide clarification of the building code outside of the dispute resolution process handled by the Building Code Appeal Board. The building participants, including local building officials, have requested that the province provide authority to have interpretations of the building code, to provide greater clarity and guidance to the meaning and application of the building code.

So it's not making changes to the code; it's giving guidance on how it's applied and on the regulations.

Consistent interpretation and application of the code is essential to the effective implementation. I think this is a pretty important step because there has been confusion in the past.

Basically, where there is a conflict between a directive in the B.C. building code and anybody else, the code will actually prevail at the end of the day. So the code will be the ultimate piece that says this is what it is. This is to designate somebody that I can have who issues interpretations of the building code that are binding on the parties, and therefore, we can get on with business.

D. Thorne: By that you mean, using it loosely, the old building code before the new directive, or whatever, part of the building code was proposed. You're talking the old building code would prevail. I guess the ministry would go back, then, to the drawing board and try and change the new proposal in a way that would be more acceptable to the municipalities or to the stakeholders or whatever. I'm assuming that that's what that means.

Hon. R. Coleman: The building code is a living document, basically. If it can't be, then it does get stuck in old roots of the building code, and therefore, it doesn't change and adapt with new products and technologies in building. So the ability to change that is important, and that's why the minister's able to issue changes to the building code.

Then there's the interpretation side of this thing. As an example, we recently had an interpretation that had to be dealt with, and it was, frankly, silly. But because there was no authority in the legislation to say this person is designated to do it, it actually had to come to the minister.

You know, we make vinyl siding in British Columbia. We actually have it in certain types of siding on buildings, and the rain screen technology allows for that particular siding. But we had a municipality that decided that their interpretation was that it was no longer qualified as a building product, so nobody could use that product in their jurisdiction.

Somebody else next door said: "Well, if they're not going to use the product, we shouldn't use the product, just to be on the safe side." We said: "Whoa, this actually matches up to the rain screen technology, and you're interpreting it wrong." So we're issuing a directive that says that it's okay, so that's what that individual would be able to do.

S. Simpson: I just have a couple of questions here just to understand the purpose for these changes under section 6. The bill adds the subsection that includes the conservation of energy or water or the reduction of greenhouse gas emissions. Is it the expectation that this particular change is there to enable future plans around the green building code?

I know the minister has spoken before when he introduced this, that there's other legislation to come to expand on the green building code and other matters. Is the intention of this to enable local governments to be able to deal with things that may be in that future legislation without compromising that?

Hon. R. Coleman: The best way to describe this is that this is a piece of legislation that enables us to do a bunch of things. Most of the building code and its adaptations are done by directive and regulation; it doesn't need legislation to do it.

However, in an earlier section we discussed, it took care of municipalities. This does the same thing for regional districts. Basically, what it is…. Currently the authority to make building bylaws is restricted to health, safety and protection of persons and property. This changes it now, so when the new green provisions came into force, regional district boards will need the authority to make building bylaws to administer them, which will be building bylaws in and around the issues about water and the other aspects with regards to greenhouse gases.

Today they don't have that authority. The only authority they have, that anybody has, today is health, safety and the protection of persons and property. So this now allows for them to be able to enforce the bylaws that they have with regards to water consumption, etc. — the same thing a municipality was given earlier in the bill.

Basically, that's what it does. It's enabling it to do that. So when we bring in the green building code…. For instance, if we say that effective X date, all new toilets in new construction will be low-flush toilets. Today they wouldn't be able to, on the water consumption side, enforce that. But they will be able to, because they can now make bylaws to say they match up to the building code.

S. Simpson: I do note that this happens in section 6. Then in a subsequent section, essentially the same thing is done with the Vancouver Charter, to make changes in the Vancouver Charter to allow them, presumably, to have the same authority as is anticipated here.

Could the minister tell us a little bit about, with these changes happening…? Maybe this anticipates what might be coming. I'm curious about what consultation there was with local governments or with the city of Vancouver — I'm just sort of pre-empting the next section — around these questions around conservation of energy, water, greenhouse gas emissions and those things. What consultation occurred around this enabling?

Obviously, there's expectation when you enable a local government to do something. You create expectations that they will make use of them and actually do it. So how has there been consultation around what those changes might look like so that they know what they're being enabled to actually do?

Hon. R. Coleman: We've consulted extensively through a series of presentations, meetings and working groups with building industry, professional associations, local government and consumer groups. We held discussions through the Union of British Columbia Municipalities. We also held eight regional meetings across B.C. to present information and get comments on the proposals from local government.

Consultation on the modernization strategy as a whole, actually, has been ongoing since 2001, and we have consulted specifically on these changes from March to August of 2007. We heard directly from those who work with the system, and then we had the regional meetings.

S. Simpson: Just a related question to that. I know that some municipalities and local jurisdictions have been signing green charters, I think they're called — the agreements between local government and the province over what particular initiatives the local government might take, or what they may be doing to support the efforts around greenhouse gas emissions.

Was part of the consultation as those charters were done as well? I'm sure there must have been some consultation around there. Were these matters discussed at that time in terms of what kinds of expectations the government might have around what local governments would do?

There was a consultation, as the minister has pointed out. I'm wondering whether the government sort of put expectations on the table as to what kinds of bylaws local government might adopt to be able to get at emissions reductions or clean energy and water.

Hon. R. Coleman: My understanding is that it was probably part of it. This is not to do with those green charters, though. This is the building code itself. On the building code side, we're giving them the ability to basically enforce what we're going to bring in, in regulation, with regards to water and conservation, etc., so that they can do that in their future construction.

I would expect that if they signed on to those charters, they're going to be the ones that will be first out to do the bylaws that will match up to the building code. I don't have any control over that part. I'm just trying to get the code done.

S. Simpson: On those discussions around building code changes…. As the minister referenced, there's been a series of consultations with practitioners, local governments and such on what the building code changes might look like and that this empowers, and I guess we'll continue to see those changes.

Is there any information available on those consultations and the kinds of advice that government was getting? Is information available that we could look at as to what sorts of advice the government was getting about what those changes might look like on the code, who was talked to and how they might help to accomplish the objectives of government around climate change?

Hon. R. Coleman: The member's questions are outside the scope of this legislation. The green building code consultations have been going on since last fall into now. They're just being wrapped up. I don't think there'd be any big deal with us being able to review and publish those. We don't think it would be a big deal. It would just depend on how long it takes to get it up on a website or something, or we could probably provide it to the member directly.

With the green building code, we first had to get this structure in place. Now we can go to the green building code and say: "Here it is; it's now enforceable. You guys can do your job." We'll make sure it's clear and understandable as we do the regs on the green building code side.

D. Thorne: I just had one question on section 6. It does parallel the earlier section. I meant to ask then, and I forgot. Around the conservation of water, I was thinking of practices such as grey water and those kinds of more advanced or modern and not really very prevalent ways of conserving water.

I'm just wondering. Does this give the municipalities and regional districts — everybody, basically, who is covered under this, which is all three charters, really — any more ability to bring in systems like grey water, which they would have to do, obviously, with the Health Ministry? They have not had any ability really to do that. We tried to do that in Coquitlam and found that we just weren't at all able to encourage, in the new construction, grey water and those kinds of systems.

I would think that a green building code…. To give the municipalities, regional districts, rural areas — everybody, but particularly, Vancouver and the suburbs — the ability to bring in those kinds of systems would take us light-years ahead in conserving water and becoming truly green. I'm just wondering: has there been any thought yet given to that? If not, are we going to be looking at that as we go down this road in the future?

Hon. R. Coleman: We're actually investigating the grey water opportunities now, as we're developing the green building code going forward. There are some things that we hope we can accomplish there. I agree with the member that we should be able to recycle this. They do it elsewhere in the world. There's no reason we shouldn't be able to do it here.

On the other side, on the building and structures side, that's an area of concurrent authority with local governments. It is the province that establishes the technical building standards through the B.C. building code and regulations, and the Local Government Act sections.

So concurrent authority means that the province must be consulted and must agree with any local building bylaws which would impose technical building standards different than those established by the province under the building code.

Hon. R. Coleman: I move the committee rise and report the bill complete without amendment.

Bill 10, Housing Statutes Amendment Act, 2008, reported complete without amendment, read a third time and passed.

Hon. G. Abbott: I call committee stage debate on Bill 6, Electoral Reform Referendum 2009 Act.

The House in Committee of the Whole (Section B) on Bill 6; K. Whittred in the chair.

J. Horgan: When we left off yesterday, the Attorney and I were exchanging debate on section 4 with respect to the opponent and proponent groups that may arise from the referendum campaign in May of 2009. I was

asking the minister how we would be apportioning the $500,000 to each side. I was trying to get some sense of how many opponent or proponent groups the minister contemplated in this act.

In particular — I'll maybe lead him in the direction I want to go — the Charlottetown referendum in the early '90s had a similar, I believe, provision to this, where there were registered opponents and proponents. They received funding from the federal government to make their case for or against that referendum. I'm wondering if that is the intent of this section.

Hon. W. Oppal: The model used is after the recall and initiative legislation. Presumably, groups will apply for funding, either on one side or the other of the issue. The intention here is to have a reasonable number of groups apply so that the funding provided to them is not diluted. Under the model that was used in recall and initiative, the groups would apply to the Chief Electoral Officer. They nominate a financial agent.

If there are, for instance, only a few such applications, the Chief Electoral Officer would then be in a position to apportion funding amongst the groups that apply. On the other hand, if there are a larger group of people applying, there would be a process for the groups to come together and nominate a common financial agent.

J. Horgan: In section 8, when we get to it, where the L-G-in-C will be making regulations, is where we see the establishment of the opponent/proponent groups.

But before we get there and while we're still on the funding question, if I understand the minister correctly, those that are opposed to the question will have one agent acting on their behalf, even though there may be multiple groups across the province in different communities and different constituencies. Certainly, there could be as few as 79 constituencies, or 85 if we go on the boundaries that are proposed, and in each constituency there will be a pro and a con committee. There could be multiple committees in each of these constituencies.

I'm wondering how one financial officer is going to manage all of those disparate groups across the province. How are they going to manage that if the financial officer is in Victoria and the committees are in Bulkley Valley and in the Peace and in other parts of the province?

Hon. W. Oppal: The member's premise is, with respect, incorrect. There is no limit on the no side, as was suggested.

It's instructive to note that the recall and initiative legislation puts a limit of five financial agents. The concern here is that, if there are too many groups, the financial resources — the $500,000 maximum — will be diluted, so as to make any particular group ineffective. As far as the geographical positioning is concerned, there's nothing in the legislation concerning that. We have one Chief Electoral Officer in the province, and that certainly hasn't made the running of elections and all of those statutory duties that are associated with that office difficult to implement.

J. Horgan: Certainly, the Chief Electoral Officer can run an election campaign as a neutral body, but what we're talking about here are proponents and opponents of a particular point of view. It's going to be a campaign. There are going to be as many campaigns as there are electoral areas. When we get to section 5, when we talk about the supermajority and so on, these are election campaigns. There are going to be people all across British Columbia wanting to participate in this and seeking access to these funds.

Where I'm trying to go with this is that you're going to have 85 election campaigns on the question of whether or not to support or reject STV — so all 85 communities, and in fact, those are just electoral areas. Within those electoral areas, as the minister knows, there are multiple communities. How are we going to spread that $500,000 around in an equitable way to ensure that each constituency has access to it without, as you suggest, diluting it to being insignificant?

Hon. W. Oppal: It's interesting to note that during the last initiative there were fewer than five on each side. So we don't anticipate that there will be 85, or whatever random number you may select hypothetically. The fact is that the more people there are on each side, the more funding will be diluted, and it would be in the common interest for the people to come together.

It would make no sense for either side to have 80 or 85 or whatever number is proposed on each side of the question. The whole intent is to provide funding so as to make their voice effective. If there are going to be that many divergent groups, that may not happen.

J. Horgan: In the last referendum there was no funding for opponents or proponents. So we have not tested this section, that I'm aware of, in British Columbia. There has been something similar, as I suggested, in the Charlottetown referendum at the federal level. I don't know how the funding formula worked there — how they distributed the funds.

What I do know is that I hear regularly from people in my constituency anxious to see electoral reform come about. I encourage them to the best of my abilities, and they are encouraged that there will be resources available for them to make their case. But the challenge I think we have, and why I'm belabouring this point, is that there will be a minimum of 85 groups around the province who will want to put forward arguments for or against these issues.

The challenge we have is that expectations are going to be quite high, and delivery will be quite low. I don't disagree at all that, to be more effective, you would want to focus those energies. But I know, as a

member of a political party, and as the Attorney will know, as a member of a political party, there are as many opinions in the room as there are members.

So when you've got the entire province, the entire geographic area, carved up into electoral areas that require a particular outcome for this to be binding, then calling the shots from Victoria or Vancouver might not be well received. I'm wondering if the minister has contemplated how to manage those regional differences that may arise.

Hon. W. Oppal: Well, in Charlottetown there was one financial agent for each side. In this legislation it's contemplated to put no limit. If there are 85, then so be it. There will be 85. There will be financial agents, presumably, representing more than one of the groups. But, you know, it sort of defies logic and common sense to have 85 different groups on the no side or 85 different groups on the yes side.

There's nothing in law preventing that many groups from being out there if there are that many divergent views. But the fact is that there is $500,000. That's the limit to be used by them. I don't know if I could answer the question any better than that.

J. Horgan: Section 4 reads: "…to financial agents acting on behalf of one or more opponent or proponent groups." So it contemplates one or more. I'm speculating that it could be 85. It could be more than that.

If that's the case and, as the minister just said, the number of agents is unlimited, then how will we manage — I assume through regulation — the disbursing of those funds to the various financial agents? Will there be a limit? Will there be time lines? When will they be able to access the money and so on? Is this just through the writ period, or does it start as soon as this becomes law?

Hon. W. Oppal: There will be a limit on the agents but obviously not on the different groups that may be aligned on each side of the issue. The persons would apply to the Chief Electoral Officer, and he will use a formula that will be set out in the regulations.

I think it might be useful to look at the Recall and Initiative Act, which deals with this particular issue. It reads as follows: "The chief electoral officer must designate financial agents for opponents in accordance with this section as soon as possible after the end of the application period under section 31 (1)." This is section 32(1) that I'm reading.

Sub (2) of 32 states as follows: "If one individual is proposed under section 31 as financial agent by 50% or more of the total number of applicants under that section, the chief electoral officer must designate that individual as financial agent for the applicants by whom he or she was proposed."

So that may be of some assistance in determining the type of regulations that would be eventually enacted.

J. Horgan: I've just quickly reviewed section 32, or I am reviewing it as I stand here. I'll ask another question — then I'll confirm what the minister just read to me — and that would be the timing of accessing these funds. I mentioned in the litany of questions…. That's the challenge I have. I like to ask a whole bunch of questions, and I know you want to give me a lot of answers, through the Chair.

We heard, when we debated this bill yesterday, that we could expect cabinet to provide this House with a question in the spring. My friend from Whalley reminds me that there will be growth in spring. So will we be able to assume, then, that proponent and opponent groups can seek access to these funds once this bill is passed or once a question is in place or both?

Hon. W. Oppal: There's no correlation between the passing of this act and the accessing of funding. We would expect that the Chief Electoral Officer will set certain guidelines, or the regulations will set certain guidelines and the timing sometime this fall. Groups would apply at that time, and we would expect that the funding would be made available later in the year or in the early part of 2009. Those are the expectations.

J. Horgan: So the funds will be available in this budget for this fiscal year? Then we can assume that the $500,000 must be expensed by March 31, 2009?

Hon. W. Oppal: The funding totals are not set out in the bill, as I stated. They will be included in the '08-09 budget. The allocation for the '08-09 fiscal year is $870,000 or $435,000 for each side. Now, the remaining budget will be allocated in the next fiscal year. So it may well go into the next fiscal year. It's not a case that a particular side has to spend all their money in one particular year.

I go back to Hansard yesterday. We were talking about the establishment of two offices or the separation between the Deputy Attorney General and the Chief Electoral Officer. The minister said at that time: "The government-operated office will be operated with funds from the Attorney General's office. That's a neutral office. The other office will be operated by the Chief Electoral Officer, and that office will have budgets of $500,000 for each of the two groups, the pros and the cons."

That's how we ended the debate yesterday, and I'd like to just go back to that for a moment — the reference to one being neutral and one not. One was neutral and one was not named. I'm assuming that they're both neutral, and I'm assuming, also, that of the $870,000 allocated from consolidated revenue fund for this fiscal, none of that will be going towards the implementation of the referendum in May of 2009.

So which office is running the referendum, and which office is paying for the proponents and opponents?

Hon. W. Oppal: Well, maybe I wasn't clear. I thought I was. In any event, the $500,000 is a separate $500,000 for the running. That's a separate office. The $870,000 that I made reference to is for the advocacy groups for the pro side and the con side. So $435,000 has already been earmarked for each side. You're talking about different funding here for different offices.

I should state that the $870,000 is not for the funding of any office, it's for the advocacy of each group.

J. Horgan: Now, the $870,000 is, in fact, a million, but it's spread over two fiscal years. So I've got that.

It's the additional $500,000 that we spoke about yesterday, and that brought in the Deputy Attorney General and what was referred to as a neutral office. Now, I thought that that $500,000, separate from the advocacy component, was for running the referendum, for financing the referendum.

If that's not the case, then what would that $500,000 in the Deputy Attorney General's office be for?

Hon. W. Oppal: That's for a neutral information office. There has to be some kind of central repository from which all of this has got to operate. You simply can't have the Chief Electoral Officer funding a group over here and a group over here. It makes sense that there ought to be a central, coordinating office. We want to ensure that this referendum is properly funded and is properly operated. So that's the reason for the neutral office.

J. Horgan: Well, now I'm more confused. As my son will attest, that's easy to do.

We have $500,000 to be neutral and set aside to ensure that all sides are heard, and we have a million dollars set aside to be apportioned evenly to those that are advocating for and those that are advocating against. So, $1.5 million: $500,000 of it in the Attorney General's ministry, for a purpose not clear to me; and a million dollars being apportioned by the Chief Electoral Officer for advocacy for and against.

I'm really not clear what the role and function of the Deputy Attorney General is and what that $500,000 will be used for.

Hon. W. Oppal: Hopefully, I'm clear this time. I said this yesterday, but the $500,000 is a neutral information office. It has nothing to do with the other million dollars that will be spent on the advocacy pro and con. The $500,000 is a neutral office, from which people can get information as to where they could go, and they don't have to go to the pro side or the con side. They can go to a government information office as to how they can get involved in the process. That's what it is for.

J. Horgan: Then this neutral office function will be to be a traffic cop? To direct those who are interested in getting more information on the subject to go to either camp A or camp B, and perhaps potentially part C, which would be: here's the information that we've prepared that is generic, on how STV works in other jurisdictions, and how it may be contemplated to work here. You'd refer them to the Electoral Boundaries Commission and the proposed maps that are contained in that.

If I'm clear, then, the function of the first $500,000 is purely educational, based on all available information, and in the event that someone wants to advocate for or against, the office will direct them to the Chief Electoral Officer, who will put them on to a financial agent. I think I'm getting it, and I'm getting some nods. I'll just see if the minister could clarify that.

J. Horgan: I'm delighted that the Attorney has given me full marks today for summing up how we've proceeded with section 4. With that, I will allow section 4 to pass.

J. Horgan: I see my friend with the cashews has arrived, but I just want to advise the Attorney that I do have a number of questions I'd like to pick up at another opportunity on section 5, particularly to clarify the intent of the supermajority and so on.

Committee of the Whole (Section B), having reported progress, was granted leave to sit again.

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

Mr. Speaker: Just before the motion to adjourn, I want to wish everybody well for the next couple of weeks that you're spending in your ridings. I hope everyone gets a little bit of time to spend with their families, also. We'll be back here in two weeks' time.

Hon. G. Abbott: Thank you, Mr. Speaker. All the members wish you well unanimously as well.

B. Ralston: Before the break I'd asked a question about the audit of the contract that we were speaking of, the contract with Telus — the $133 million contract over ten years. The minister explained that there is an audit that's conducted annually by the internal audit function of the office of the comptroller general.

I asked the minister — from my quick review of the Blues over the lunch hour — if she was prepared to release that audit to me forthwith. With respect, I don't believe the minister answered that question, so I'm going to repeat it. Is the minister prepared to release that audit forthwith to me?

Hon. O. Ilich: The audit is done by the Office of the Auditor General. He performs an annual payroll audit to ensure government is managing its responsibilities and resources appropriately.

We have completed two audits, with all recommendations implemented successfully. We will be happy to see whether or not the Auditor General can provide you with a copy of that.

B. Ralston: Just so we're clear. As I understand it — and again, I may be mistaken — the internal audits conducted by the internal audit branch of the office of the comptroller general are different entirely from the Office of the Auditor General. The Office of the Auditor General is an independent office of the Legislature and may from time to time conduct audits which are subject to different rules and different process of disclosure.

What I'm asking for, just so that it's clear, is disclosure of the audit conducted by the office of the comptroller general. Sometimes, in my experience, when these are requested, the ministry will say, "Well, go to the freedom-of-information process," and thereupon begins a long and tangled tale, sometimes taking up to nine months or a year for a simple audit of how taxpayers' money is being spent.

What I'm asking for from the minister is the commitment here today that the audit of this contract conducted by the office of the comptroller general be released to me forthwith.

Hon. O. Ilich: The full report has had restricted distribution, as it is an evaluation of Telus's key controls, their internal controls, which include confidential activities and some sensitive information that belongs with them.

It is possible to get a copy of the report, but it will be severed according to what we are allowed to do through the freedom-of-information office.

B. Ralston: Well, I can understand the severing of proprietary information, but this is a company that, according to its website, quotes a member of the alternative service delivery secretariat as saying that this contract is saving the taxpayers of British Columbia $130 million.

That was the assertion that was made. The minister said before the break at lunch that that must be an error — that the public servant at the alternative service secretariat who was quoted was misquoted, likely. This is now some three hours later. I'm wondering if the minister has had a chance to have her staff in that section, or at least 30 or 40, track down that reference and offer an explanation.

I think that people who are watching this or who may be reading it should be aware that after these estimates end sometime this afternoon, I won't be able to — nor will any other opposition member — come back and ask the minister in some process this session any follow-up questions.

So it's now or never. The minister can choose to not answer that question, but I certainly would appreciate an answer if it's available.

Hon. O. Ilich: In fact, we were in touch with Telus over the lunch break. They have updated their website, and they do say that they made a mistake. The line now says that direct savings are anticipated to be in excess of $30 million over ten years.

I do have to just do a bit of editorializing here. We are very proud of the fact that our ASD contracts have saved us $550 million over ten years. It's something that we're committed to. We've got a great team of experts. All of the things that we do are fully disclosed on the website. We've given you the link to that website. So the contracts are there, and all of the information is there. We're happy to answer questions about the contracts, because we believe that they provide great savings to the taxpayers and that it's a great way for us to do business.

B. Ralston: That's a little bit more, I might say, just parenthetically, about Telus. That's a little more of a rounding error. That's an error of $95 million, and there are claims for the cost savings on this thing. It does make one slightly more skeptical about what the government is advancing here when one of the self-described leading corporations in the province makes that kind of an error and quotes an official from the government erroneously on such an important matter, but I'll leave that aside.

If the minister's commitment is to openness and transparency about these contracts and she wishes to

demonstrate to the public the savings, can she explain why there was an effort to designate, through past legislation last April — which was abandoned but certainly must have come from her ministry — a government procurement project as a so-called joint solution project under the Freedom of Information Act. If so designated, public organizations would be forbidden to reveal commercial, financial, labour relations, scientific or technical information about a third party to the joint solution project or the project itself.

Is there any intention to revive that request and attempt to introduce legislation to attempt a similar blockage of public disclosure of these huge expenditures of public dollars?

Hon. O. Ilich: I think the member opposite is talking about a piece of proposed legislation that was dropped, and the government has no intention to reintroduce that.

B. Ralston: The calculation that's offered has been scaled down now, but the calculation or the claim that's made about saving $30 million…. What documentary evidence is the minister prepared to provide, beyond the usual rhetorical support for such ventures that might enable a member of the public to understand where this claim comes from?

Hon. O. Ilich: The deal summary of the business case is on the website. There's regular annual reporting, and the next report is due in May of '08.

I'd like to just say, though, that we have a transparency policy for ASD projects, and what we try to do is strike a balance between maximizing transparency and also protecting third-party information. We do have clear guidelines for the proactive release of contract information and regular public reporting on contract performance. We do disclose the provisions of the signed contracts, and we report regularly. We believe that we're the most transparent jurisdiction in Canada on these large ASD contracts.

B. Ralston: As I understand the comparison that's made, it's made to a counterfactual hypothetical — what would have happened had the contract or this provision of services proceeded in another manner within government. Is that the method by which this comparison and the calculation of the alleged savings are made?

Hon. O. Ilich: Actually, the business case is compared to what we were spending and would have been compared to the business-as-usual spend of the government if we were doing the same kind of work.

B. Ralston: I want to deal with the next Telus contract. I think it was described by the minister as network services, and that was $245 million over four years. Is that a correct description of the contract?

Hon. O. Ilich: NetWork B.C. The objective of NetWork B.C. was to aggregate the telecommunications spend of the government — we have our core public sector and then the broader public sector — in order to bridge the digital divide and provide benefits to government.

There is a price book that government was buying from, and what we were able to do by aggregating the obligations of the contracts was receive a 15 percent discount day one on that contract. Each of the participating government agencies buys off that same price book. By aggregating it we were able to save on day one, a reduction of 15 percent. For instance, it went from $73 million down to $62 million immediately. That was one contract.

The other part of that contract is what we call bridging the digital divide, and that is where we have been connecting communities. So 359 of the 366 communities that were identified by the Premier's Technology Council have been connected. We're also going to first nations and making sure that they're connected with broadband in order to meet the obligations we have for telehealth and tele-education and those sorts of things and to provide economic benefit to all of the communities in British Columbia that would benefit from being connected to the network.

B. Ralston: I take it, then, that there are two principal contracts under this heading. Were these two contracts negotiated by what's called the joint solutions procurement — that is, Telus and the government sitting down over a number of months and working out a deal?

B. Ralston: Well, I appreciate that the deal is concluded. I'm interested in the process by which it was arrived at. So my question is…. Under this description — I appreciate that it's a little bit euphemistic, at least to my ear — a joint solutions procurement, which we had discussed, is an alternative to the standard requests for proposals.

Was it this contract or this total value of $245 million over four years…? Was this negotiated or arrived at through what's called the joint solutions procurement?

B. Ralston: Can the minister, then, tell the House how this procurement was arrived at? Was it a conventional request for proposals?

Hon. O. Ilich: Telus was already a primary service provider to the government under a number of contracts. What we tried to do with the Network B.C. was aggregate the contracts to derive some efficiencies and bring down the costs, which is what we did. There was a notice of intent filed, and there were no objections. There was nobody else that came forward, and so we continued to negotiate with Telus.

B. Ralston: Usually, I suppose, a citizen, if they went to buy a cell phone contract, would go around and look at various providers. There are other major telecommunications companies such as Bell Canada, which I understand, if business press is to be believed, is aggressively pursuing business opportunities throughout the country.

Just to be clear then, the minister is saying that there was no other telecommunications firm — phone company, if you will — that expressed an interest in this contract for $245 million of government services?

Hon. O. Ilich: What happened with the Telus deals is similar to when you have a contract already with your telephone provider, and you are able to negotiate a lower rate because you are not breaking the contract and you are aggregating and adding to. That's what we did.

There was a notice filed. There was no other group that came forward and said that they would like to do that. We did inform Telus at the conclusion of that contract that we would, in fact, be tendering it going forward. But at the time that it was negotiated, it was an attempt to aggregate the many contracts that we had across government and bring down the cost.

B. Ralston: Just so that I'm clear, then, there were a number of other…. I take it, typically, that the contract would be ministry by ministry. Was there a common expiry date for those contracts? Then this process of aggregation — putting them all together, I think is probably a simpler way to put it — took place. I gather that there's now a single contract that expires. The reference was four years.

Hon. O. Ilich: When the contract was first negotiated, there were a number of contracts that were in existence already. For instance, health authorities and ICBC had separate contracts.

Again, what we attempted to do was to aggregate that into one contract so that the collective spend…. We would get some benefit from that. And we did. We got a 15 percent reduction right across the board, and we did that on day one, where we received a big discount.

The contract expires at the end of this year. We will be renegotiating that at that time.

B. Ralston: Just so that I'm clear, because sometimes the terms are used somewhat imprecisely. The contract over four years for $245 million, then, expires at the end of this calendar year — that's December 31, 2008?

Hon. O. Ilich: Yes, it does. It does expire, and we have given notice of our intention to go back to the market.

B. Ralston: By "go back to the market," what form of procurement has the minister decided to use on behalf of the government, for this very substantial contract?

Hon. O. Ilich: We are currently dealing with our partners to talk about the procurement strategy. It's being worked on right now.

B. Ralston: When the minister says "partners," I'm not sure what she means, so perhaps she could be clearer who the partners are. I'd like to know all of them, please.

Hon. O. Ilich: That would be the health authorities, WorkSafe, B.C. Hydro and ICBC, as well as us.

B. Ralston: Well, given that it's one contract now, is the process to solicit requests for improvements and/or enhancements in the services that are offered in the contract? Or is it simply a pro forma checkoff by each of these government agencies, with the real decision-making made by the alternative service secretariat or some other agency in the ministry?

Hon. O. Ilich: We're developing the strategy right now. The member should be able to understand that this is a very complex contract. We've got a lot of partners, and they have various needs. The procurement strategy is being worked on right now, but the overriding principle, obviously, is that we have the best value for the taxpayers of British Columbia.

B. Ralston: So would it be fair to say that, at this point, a joint solutions procurement has not been ruled out for this contract?

Hon. O. Ilich: It has not been ruled out, and it has not been stated that we will use that. It's still being developed. There's consultation going on with our partners at the moment to make sure, as I said before, that we get the best value for the taxpayers.

I understand that the joint solutions procurement process was the subject of an audit by the Auditor General, and I understand that that report is due any day now. Typically, from my experience on the Public Accounts Committee, the ministry is offered an advance copy of the report with an opportunity to respond to the audit that's been done.

Can the minister, first of all, confirm that's the process that's taking place and, secondly, if that is so, advise where the report is at and what she anticipates, based on the ministry's review of the report, will be the likely release date?

Hon. O. Ilich: The release date will be the decision, obviously, of the Auditor General, and we are in fact reviewing the report for the final time right now.

B. Ralston: Well, I understand that the ultimate release date is at the discretion of the Auditor General. He's an independent officer of the Legislature. I

understand that. When does the minister expect that her ministry staff will have completed their review and comments in response to the findings of the Auditor General?

Hon. O. Ilich: Within the next two weeks we expect to be finished with that.

I want to deal now briefly with two other contracts that were spoken of. On the workplace technical contract with IBM, a contract for $300 million, can the minister briefly describe what that contract involves, what its expiry date is and what its annual payments are?

Hon. O. Ilich: I will just explain what the contract is about and talk a little bit about what it is. This is a contract between ourselves and IBM Canada, under which IBM Canada is responsible for delivering government workstation services and managing the related technology infrastructure. This is a ten-year contract that was signed on December 3, 2004, between the province and IBM for those services. The value, as we've noted, is approximately $300 million.

There is a range of financial controls in place outlined in the contract, including the right of the province to perform financial, security and operational audits, and in the first two years the province realized $8.35 million in cost savings. The service delivery commitments are defined, measured and reported monthly and provide the ability to track improvements and service enhancements.

B. Ralston: Once again, is there a provision in the contract for independent audits — for example, the internal audit function of the office of the comptroller general. Are those done annually? If so, is the minister prepared to make a commitment, so that I'm not obliged to head through the freedom-of-information process, which is often delayed, to provide those audits forthwith?

Hon. O. Ilich: As I said in the first answer that I gave, there's a range of financial controls in place and outlined in the contract, including the right of the province to perform financial security and operational audits. I have here a copy of the audit rights from the contract which I'm happy to go into:

I could go on, but it's a very comprehensive contract that gives us full rights to audit. It's done regularly.

B. Ralston: Well, I understand the language of the contract that reserves those rights. I'm interested in when they've been exercised. Can the minister advise when, if any, audits were conducted, beginning from the present and proceeding backwards over the last two years?

Hon. O. Ilich: This is a contract that we haven't audited yet. We have the right to audit it, but it has not yet been audited.

B. Ralston: Just so that I'm clear, then, the contract was signed on December 3, 2004, and as of today's date none of the language in the contract entitling the government to an audit has been utilized and no audits of any kind have been conducted. Is that correct?

Hon. O. Ilich: The reason for that is that we have just finished the rollout. For instance, they completed the largest provincial government computer refresh, and that was finished in 2006. They replaced 32,800 workstations in 1,500 sites across the province in 22 months — just two months ahead of schedule. We're also continuing to work with them. So they're just finishing their first four-year cycle. We also continue to monitor the contract to make sure it's being performed adequately.

B. Ralston: Well, I understand that the contract is in process. It's now, by my calculation, about three years and four months into it, and there has not been a single audit for any purpose. Who made that decision?

B. Ralston: The contract was signed on December 3, 2004, and we're now over three years and several months into the life of this contract. What I understand the minister is saying, notwithstanding all the contractual language in the contract, is that no audit, for any purpose, has been conducted during that entire time. My question is: who made the decision, apparently, not to order an audit of any aspect of this very substantial contract?

Hon. O. Ilich: I think there might be some confusion as to what we're actually doing. There's a performance review that is constantly being done. The audit won't be done until the contract is fully implemented. We pay a per-workstation charge right now, and we're

just coming to the completion of that. The Auditor General actually does an annual audit of all of the accounts.

B. Ralston: So you say that the Auditor General does an annual audit of this specific contract? Is that what I'm being told? I'm not clear.

Hon. O. Ilich: Under this particular contract we pay a per-workstation amount. There are approximately 34,000 workstations now out there. The Auditor General audits the expenditures, so it's fairly simple for him to check. Do we have the number of workstations, and have they been paid for? That's done annually. We will not be auditing this particular contract until '09-10.

B. Ralston: Sometimes an audit is simply more than counting the individual units that have been installed. Is the minister, then, satisfied that this contract is being well managed, given that the only audit seems to be simply counting the number of workplaces that are installed?

It is a $300 million contract. It doesn't seem to me, if I might be permitted this observation, that it's enjoying a great deal of scrutiny.

Hon. O. Ilich: As I said a few minutes ago, I think the member opposite is misunderstanding what is happening. The audit is checking — the Auditor General does — the financial controls. We do get a performance report, and we do share those performance reports with all the ministries. We do that on a monthly basis.

We do check to make sure that we are getting the services that we are supposed to be getting. Those services are managed centrally, and it ensures that security updates are rapid and consistent. So those are the kinds of things that we're doing.

We have service delivery commitments that are defined, measured and reported monthly — and I said that at the beginning — providing the ability to track improvements in service enhancements. That's what we do. That's what we check. The audit, as to the expenditure of the funds, is done by the Auditor General on an annual basis.

B. Ralston: So as a result of those monthly reports…. Perhaps the minister can just clarify who receives those reports. Is it the alternative service delivery secretariat or somewhere else in the ministry?

First of all, who receives them? And based on receiving those reports and analyzing them, have there been any penalties or concerns raised by those who I presume received these reports and carefully analyzed them, given the value of this contract?

Hon. O. Ilich: Those reports, every month, are given to workplace technology services. It's important to note that every one of those computers is a part of that contract. The service level agreements are monitored, also, on a monthly basis.

B. Ralston: Perhaps the minister can advise, then: where does workplace technology services fit into the galaxy of acronyms and agencies within her ministry?

Hon. O. Ilich: I think that maybe there's a little bit of confusion. The alternative service delivery people in the secretariat deliver the contract, but the contract is then administered by somebody else. In this particular case, it's workplace technology services. They're the information technology division of Shared Services B.C.

As a steward of the IT assets and the supply arrangements, they — workplace technology services — are responsible for providing cost-effective management and supply of the IT services to core government ministries, program managers and government employees.

Workplace technology services is also responsible for understanding the business objectives, future directions and unique requirements of the program it supports. WTS provides services to 19 core government ministries, several Crown corporations, the broader public sector organizations and over 30,000 government employees.

As I said, they're responsible for keeping the contract going and making sure that all of the computers that we use here in the Legislature and throughout the public service are operating properly.

B. Ralston: Just so I'm clear. Workplace technology services is a division or a subcategory of Shared Services B.C., which is an agency that is housed in the Ministry of Labour and Citizens' Services. Is that correct?

Hon. O. Ilich: If the member would go to the estimates…. Under our estimates, it's "Services to the public sector — Shared Services B.C. workplace technology services." It's a $1,000 vote.

B. Ralston: Shared Services B.C., then. What is the role of the alternative service delivery secretariat other than…? Is there any ongoing role that it has in its operation, or is that simply an agency that operates autonomously from the secretariat?

Hon. O. Ilich: The ASD secretariat is a centre of excellence that helps client ministries or agencies procure the contracts and helps manage the contracts, but they don't actually keep any of the contracts themselves.

So the contracts go out to the client ministries. In the case of workplace technologies, we have that in our ministry as a shared service, but they just assist in the procurement method.

B. Ralston: I want to turn now to the service IBM contract that was described as $35.6 million. Is that a contract between IBM and Shared Services B.C. or is it with some other agency?

B. Ralston: And what services are provided under that particular contract? Can the minister give a rough

description of the services provided, the date the contract was signed, the date of the expiration and the annual payment?

Hon. O. Ilich: Service B.C. runs the contact centre — so Enquiry B.C. — and website infrastructure and initiatives to improve service delivery.

B. Ralston: Can the minister say when that contract was signed and when it expires?

B. Ralston: I think that the minister may have inadvertently omitted the start date. June 26 of what year? And the annual payment?

Hon. O. Ilich: Sorry about that. The contract was signed June 2006 and expires June 2014.

B. Ralston: Turning again to the alternate service delivery secretariat, some of the literature speaks about further outsourcing opportunities. I understand that, obviously, there are certain concerns, I suppose, about commercial secrecy. Can the minister advise: what are the broad directions that the secretariat is looking in for future opportunities, if you will, to outsource government services?

Hon. O. Ilich: We're currently looking at hosting in the data centre. That's another one that we will be doing with our broader public sector partners.

B. Ralston: The minister will have to excuse my ignorance. Perhaps you can explain more fully what hosting in the data centre means?

Hon. O. Ilich: We currently have this document out on the street, so it is publicly available. The workplace hosting services is a branch within the workplace technology services. It provides computing server platforms for processing, hosting and storage of applications, data and information, working to agreed-upon service levels so that the clients can build and run their business applications in this secure and managed environment. Consulting services are also provided as a shared or customized service offering.

Currently the province has developed or purchased hundreds of business applications, which are hosted on approximately 1,600 server platforms and one mainframe computer. The scope of the operations includes ministry and non-ministry applications needs as well as other shared services or cross-government applications needs such as corporate accounting services, collaboration software, middleware, shared file and print services, e-mail, authentication services and the WTS information technology infrastructure.

B. Ralston: Can the minister advise if it's her current thinking that this would be a joint solutions procurement or not?

B. Ralston: Just to continue along that line of questioning. Aside from this prospect, can the minister advise if there are any other areas of service presently delivered by government that are being examined by the alternative services delivery secretariat with a view to outsourcing them?

B. Ralston: Mr. Bethel was described in the material I referred to this morning as overseeing the delivery of the province's key outsourcing program, totalling almost $2 billion. I just want to be clear that we have touched on all aspects of that almost $2 billion in outsourcing in the questions I've posed.

I appreciate that $969 million of that, which the minister was not able to describe, is going to be provided at a later date, at a time when I will not be able to ask any questions directly of the minister. So be it, I suppose. But other than that and the other areas that I've touched upon, are there any significant contracts composing that $2 billion that have not been touched upon?

Hon. O. Ilich: As I explained a few minutes ago to the member opposite, the ASD secretariat provides services across the government. Some of those contracts will actually reside in other ministries and will be part of the estimates of those other ministries.

With respect to the $969 million, I can give you a further breakdown: IBM Global Services, $207 million; data network and voice telecom services — the voice-to-mouth telecommunications services, $152 million; data network services, $150 million; the leasing costs for the government, $567 million; building maintenance costs, $280 million; and vehicle management services, $122 million. That's $969 million.

B. Ralston: I'm sure the minister will understand if I ask a few clarifying questions. The contract for $207 million with IBM — that's separate from the others that have been referred to. Can the minister briefly describe what that contract is, when it was signed, when it was concluded and the approximate annual payment?

Hon. O. Ilich: The IBM Global Services you've already talked about. The NetWork B.C. one, which is the data network and voice telecom service, we have

already talked about. The other ones are the $280 million for the building maintenance costs; leasing commitments, $567 million; and the vehicle management services, $122 million.

B. Ralston: The leasing costs, I'm assuming, obviously are the leasing costs of all space for the government throughout the entire province or the occasional office, I suppose, that's outside the province. The vehicle maintenance — I think that's fairly straightforward. If I'm wrong, I'm sure the minister will correct me.

Given that answer, that comprises the full range of all contractual obligations that the minister is responsible for, to compose the $2 billion that Mr. Bethel, according to Canadian Management Centre, oversees?

Hon. O. Ilich: The four contracts that we have, we've explored, and six of the contracts comprising the balance of the money are in other ministries.

B. Ralston: In a brief description of a course at the Centre for Outsourcing and Education at the Canadian Management Centre, Eulala Mills-Diment, the chief alliance executive of the province of British Columbia, is described in this way: "She leads the team that provides guidance to the ongoing management of the province's ten large outsourcing relationships. She specializes in building the capacity for effective ongoing outsourcing management."

The ten relationships that are spoken of — are these the same relationships that the minister has just enumerated, or are there different relationships that Ms. Mills-Diment is involved in?

Hon. O. Ilich: The ASD secretariat continues to provide management support. These deals are complex, and we continue to provide backup and support for ministries that have these contracts within them.

B. Ralston: Well, I appreciate the minister's answer, but it wasn't responsive to the question. The reference is to the province's ten large outsourcing relationships. This chief alliance officer, who is in the staff of this secretariat and on the staff list, is described as providing guidance to the ongoing management of these ten large outsourcing relationships.

I just want to know what those ten large outsourcing relationships are. If we've covered them already, the minister can say that. If they're different, the minister could please say that.

Hon. O. Ilich: I'll just go over the other six that we've not already canvassed, and they will be within the other ministries.

The revenue services B.C. contract, which is the Hon. Minister Thorpe — it's with EDS Advanced Solutions. Health Insurance B.C. — Maximus, in the Health Ministry; the common student information systems, which is with Fujitsu Consulting, and that's Shirley Bond. Residential tenancy branch also has a small one with Telus to develop and implement an on-line and contact centre–based system. Provincial Lab Information Solution with Sun Microsystems — again, a Health deal. The pan-Canadian health surveillance solution with IBM Canada, again, with the Minister of Health.

B. Ralston: I appreciate it's a summary and that it's on an external agency's description of her role. But is that accurate in broad terms — that this secretariat provides guidance to the ongoing management of these ten major contracts, including the ones that the minister has just listed?

Hon. O. Ilich: Each one of these deals in their respective ministries has a team of professionals that manage the contract. There is an alliance management officer, Eulala, and she actually works with those officers to make sure these deals are being governed according to their contracts.

B. Ralston: Am I correct in taking from the minister's comments that this person and the secretariat, in general, but certainly this person as the chief alliance executive is the person who is accountable for the performance measures of these individual contracts? That's certainly what the minister seemed to be saying.

Hon. O. Ilich: The deals are owned by the respective ministries, and they are reported on to those respective ministries. They're housed in those ministries, and what we provide is help and support in the management of the contracts.

B. Ralston: Well, I suppose what I'm concerned about is the accountability. Is this agency merely a flying buttress, and the accountability is through the individual minister?

Is that what the minister is saying? Regardless of what advice is offered, what advice is taken, what advice is ignored, the individual minister in whose ministry that contract may be housed is ultimately responsible for the performance — or not — of that contract. Is that correct?

Hon. O. Ilich: We're very careful to make sure that the accountability remains with the client ministry. What we do is provide support, best practices, management practices, training and support to that contract and to that client ministry.

B. Ralston: The minister did mention the ministry in which each one of these is housed, but I just wanted to be clear. I take it that, obviously, the revenue service one is with…. You mentioned the Minister of Small Business and Revenue. Maximus is with Health. Common Solution is with the Minister of Advanced Education and residential tenancy with the Minister of Forests and Range and Housing.

I wasn't clear about the Sun Microsystems contract, nor the final ones. Perhaps the minister can just confirm the case of those two final ones — which ministry

they're housed in — in order that if someone should choose to, they could pursue the individual minister in their estimates.

Hon. O. Ilich: I'd like to just correct the one statement. The common student information system, Fujitsu Consulting, is with Shirley Bond, Minister of Education — not Advanced Education. The other two contracts are with the Ministry of Health, and that's the Provincial Lab Information Solutions. That's with Sun Microsystems. The other one is the Pan-Canadian Health Surveillance solution, also with the Minister of Health.

At the outset of her remarks the minister spoke of green procurement initiatives. I'm going to ask some questions on behalf of my colleague the member for Vancouver-Hastings, who is not able to be here at the moment.

Can the minister describe briefly what is meant by green procurement initiatives and what is proposed in her ministry to satisfy that emerging mandate?

Hon. O. Ilich: We're going to be, in our ministry, supporting clients in the greening procurement, as we've outlined. We're developing five new initiatives. In supporting the clients in green procurement, we're going to provide expertise to ministries to assist them to assess some environmental factors during the procurement process. Emphasis will be placed on reducing carbon emissions throughout the supply chain.

The other thing we're doing is creating an environmental assessment tool. That's a tool that can be used by ministries to assess the environmental impacts of various supply options in those situations where the environmental lens will be a major factor in the selection of a successful supplier.

We are going to be providing green procurement training. In conjunction with the B.C. Public Service Agency, we're going to develop and deliver a procurement and contract management training course devoted to green issues. We're going to assess suppliers offset programs, so we're going to develop criteria and procedures to assess the merits of offset programs adopted by suppliers and included within their bids and proposals in response to competitive tenders issued by the province.

Finally, we're going to reduce the suppliers' footprints by working with ministries that manage major outsourcing contracts to pursue a reduction in greenhouse gas emissions associated with contractors' own operations, thereby reducing government's indirect carbon emissions.

We are committed to a carbon-neutral government by 2010, and this is very much part of that commitment.

B. Ralston: I want to return to just one item that was also dealt with earlier, the new capital planning secretariat. I'm wondering how this new secretariat would interface with what's described as the government's capital asset management framework; the capital procurement checklist, which was the audit tool; and the capital standard portion, which was included in the 2007 budget. What's the intention — to incorporate those into this capital planning secretariat or not?

Hon. O. Ilich: The government is committed to continuous improvement in how it handles its capital planning. Those are documents that we're looking at. We're reassessing and taking a look right now, as we go through the planning process, at how we do all of the capital planning for the government.

None of this is complete. We are committed to continuous improvement, as I've said, and the capital planning secretariat will be assessing all of those other documents and processes to make sure that we continue to do the best we possibly can in our capital procurement.

B. Ralston: I don't want to leave a misleading impression. The minister has spoken of capital planning and, at the conclusion of her remarks, of capital procurement. I understand that this is a capital planning secretariat. What is the relationship between this secretariat and any changes or recommendations governmentwide about capital procurement?

Hon. O. Ilich: She will not be doing any procurement. That secretariat will not be doing procurement. They're planning, and that's strictly what they'll be doing.

B. Ralston: Well, at the Select Standing Committee on Finance and Government Services, the B.C. Construction Association, represented by Manley MacLachlan, said — and I would invite the minister's comment:

So my question is: in view of these very serious concerns — and I think a few fairly sharp words about the current state of construction procurement — is there any attempt in this new capital planning secretariat to address the concerns, which I think would be reasonably held and knowledgable, from Mr. MacLachlan of the B.C. Construction Association?

Hon. O. Ilich: No. The planning secretariat is going to do planning, and any other questions like that should probably go to the Minister of Finance.

B. Ralston: Well, I just want to be sure of that, because sometimes what one encounters in this process after several years is finger-pointing between the ministries. I'll ask the Minister of Finance, and she might very well say: "Well, you should have asked the Minister of Citizens' Services."

I just want to be clear that this ministry and this new capital planning secretariat assume no responsibility whatsoever. I'm not saying they're doing that in a negative way but just that that's not their jurisdiction to offer any advice or any improvements in capital procurement, particularly construction procurement, across government.

Hon. O. Ilich: We went over this at the beginning. It's a planning function and the consolidation of the capital requests and expenditure information. That's what she's going to look at. We're going to provide a priority-setting framework. We're going to reduce duplication and redundancies across the entity. We're going to facilitate timely decision-making, and we're going to enable government to communicate its capital priorities in a more coordinated and comprehensive fashion.

It's a commitment to continuing accountability, to continuing improvement as to how we do things, but there's not going to be any procurement from the construction industry. You're best off to talk to the Minister of Finance about that.

B. Ralston: Well, with all due respect to the agency that's being created, it would seem, based on this — these observations by Mr. MacLachlan — that the more urgent priority is the construction procurement process rather than coordination and priorities. There might be, given what he says, some real cost savings to be effected on behalf of the public.

But given what the minister has said, that's obviously a question for another day that I'll take up with the Minister of Finance if she's prepared to claim ownership of that process.

I think those are the questions that I have. I would say, in conclusion, that the minister has made a number of commitments here during the course of this estimates debate to provide further information. I'll be following up with a letter setting those out. I hope to have the minister's cooperation, and the minister's staff, in fulfilling those requests that have been made here publicly on the record.

With that, I thank the minister's staff for their attendance, and I thank the minister for her answers to the questions.

Hon. O. Ilich: I want to thank the members opposite for their questions. We did make a commitment that we would get a number of things to the members opposite, so we will endeavour to do that in a timely fashion.

Hon. K. Falcon: Before we get started, I'll once again introduce staff for the benefit of those that may be asking questions. I'm joined by my assistant deputy minister Sheila Taylor, chief operating officer Peter Milburn and assistant deputy minister Frank Blasetti.

M. Karagianis: Before we get started, I understand that the minister has done some speculating and may have some questions for me. So perhaps now that we're here, he could direct those questions to me. I know he's asked questions about my familiarity with SkyTrain and things, and so I thought I would give him the opportunity to ask those questions directly of me now.

Hon. K. Falcon: Well, this is indeed unusual, but yes, that's wonderful. As someone who is a regular SkyTrain user, as I am, I know that the member has talked about SkyTrain in the past. I had asked the question on whether she had actually ever ridden SkyTrain. I imagine it was probably shortly thereafter that she found herself over in the lower mainland riding SkyTrain, but I'd be interested in knowing the first time she ever rode SkyTrain.

M. Karagianis: Perhaps the minister is not familiar with some of my background. In fact, I worked in government during the late '90s for the Ministry of Transportation and Highways and so have been quite familiar with the SkyTrain as it's been built and have been riding it, in fact, for very many years. I use it frequently. I find it's the best way to get around, for the areas that I frequently travel to in Vancouver.

I wanted to reassure the minister that I am actually a frequent user of SkyTrain, enjoy it very much and have been interested in it since its early inception. As each of those lines has been built, I have availed myself of those rides — for many years. In fact, even as a municipal councillor I had the occasion to use the SkyTrain for some municipal work over there as well.

I wanted to rest assured that the minister understood that I do ride SkyTrain frequently and, in fact, travel around the lower mainland. I worked there for many years at one point and do have familiarity with a

number of the areas, including the South Fraser area and the perimeter roads — all of the various conduits that the minister has been busy working on and has speculated about my knowledge of.

Let us move into the body of the estimates questioning here. I know that when we had a moment of sort of spontaneous estimates debate here last week, we did touch on a little bit of the issues that concern me and many British Columbians here around performance payments, P3s and things like that. I would like to explore that a little, if I may, with the minister here today.

I would first like to clarify with the minister the number of major capital projects that are being done under the public-private partnership model. I'm familiar with the Canada line, the Golden Ears bridge, the Sea to Sky and the William R. Bennett.

Perhaps the minister could let me know if there are any other projects that I am unaware of that are currently being built out under that public-private partnership model.

Hon. K. Falcon: I'm sorry we don't get to keep doing the Q and A the other way. I was kind of starting to enjoy that. I guess I'll have to defer to my position in answering questions, because I have so many more I could ask the member opposite. Recognizing that this is her time for questions not mine, I will have to avoid the temptation.

The question had to do with P3s. I'm always welcoming the opposition's interest in P3s. I'm proud to be part of a government that to date, I believe, has 24 private-public partnerships, representing over $8 billion in capital, that have been built or are under construction in British Columbia.

Every single one of them is characterized by two things: they're on schedule and on budget, or ahead of schedule in many cases. It is a success story that is being recognized around the world and virtually everywhere I go. In Canada other provinces are asking me about them. They're excited about the results we're getting. There is only one group that apparently doesn't recognize the great success they've been, and that is the opposition.

Directly to the member's question in terms of what other projects there are beyond the ones she's named, there are none that we have under construction at this point. But I can say that there are three that I think are outstanding candidates for P3. The first, of course, is the twinning of the Port Mann Bridge and the Highway 1 upgrades. The second is the South Fraser perimeter road project, and the third is the Evergreen line.

All three have the right combination of complexity, construction risk and all of the challenges associated with major projects like that. We think that they are excellent candidates for P3. They will be subject, of course, to the P3 lens that we put all major projects through.

M. Karagianis: Would the minister then answer: is the Kicking Horse project a P3?

Hon. K. Falcon: Yes, both phases 1 and 2 of the Kicking Horse Canyon were delivered as private-public partnerships. The third phase — we haven't yet determined the manner in which it will be procured and delivered.

I can say that the Kicking Horse, since the member opposite raised it, is another example — Mr. Chair, if I may — that I think is a shining testament to why we undertake P3s. It's a project that was delivered 18 months ahead of schedule and on budget, to much acclaim not just in the province but across Canada. It's been an award-winning P3 project.

M. Karagianis: The minister did mention that the third phase has not, at this point, been determined. Would there be any reason to assume that it's not going to be done by the previous third party, the private partner?

Hon. K. Falcon: What we're looking at right now with the third phase is whether we do it as one entire project or whether we break it up into smaller component projects. However, we haven't finished making that determination. Once we make that determination, we will then look at those components and determine whether or not they are best to be delivered by a P3 method, by a design-build method or by traditional procurement. Either one will be on the table.

M. Karagianis: In the case of phases 1 and 2, if these are typical P3s, then the private partners have an expectation of performance payout over the next number of years.

The Chair: Members, you heard the bell. The committee will recess until after the vote.

M. Karagianis: I'll try and pick up where I left off. We were discussing phases 1 and 2 of the Kicking Horse Canyon project. I wanted to ask the minister about the two phases done by two separate companies, as I understand it. Can the minister explain the financing on this and how these two separate companies have interests in specific and separate phases?

Hon. K. Falcon: Just to walk the member through the way the concession works and operates…. Phase 1 was a design-build that was constructed by a company called Emil Anderson.

Phase 2, the next phase, was the Park Bridge. It was the centrepiece of that next phase, and it was a concession not just for the construction of the Park Bridge and

approaches but also the maintenance of the entire 26-kilometre corridor. So that would include the rolling in of the initial phase 1 that was built by Emil Anderson. The contractor, the concession group, for phase 2 is now responsible for that entire 26-kilometre corridor.

As I say, on the third phase, what will happen is…. We're just determining what kind of breakout we're going to have in terms of how we're going to procure the balance of phase 3, depending on what chunks we think are most manageable for delivering.

M. Karagianis: In the case of the initial contractor, Emil Anderson, what exactly was the arrangement on their P3? Is it a standard P3, where they had their initial capital investment and they will have their performance payment plan over a number of years?

I know the minister alluded in our first round of questioning in the big House the other day that some of them are 20 years and some of them are 30 years. What's the exact nature of that contract?

Hon. K. Falcon: So two phases in the contract, the first phase being a $62½ million contract for a design-build for the Five Mile Bridge, a project that was delivered successfully on time and on budget by Emil Anderson. It shows in here $64 million, so those will be some of the ministry costs on top of that.

The second phase, of course, with the centrepiece being the Park Bridge, is showing, as the member points out, in the service plan as $143 million. The contract amount would be somewhat less than that, so we'll have Ministry of Transportation costs that we also show as part of that. But the global costs are, of course, accurate.

That's a total cost of $207 million for the first two phases, with the third phase being announced as $134½ million — subject to, of course, the procurement processes, which we're still in the process of determining.

I recall the member asking something about…. Phase 1 was delivered as a design-build by Emil Anderson. Phase 2 was what we call the DBFO — design-build-finance-operate-maintain — contract that was awarded to the concessionaire for maintenance operation of the entire 26-kilometre route.

M. Karagianis: Still sticking with phase 1 here. I'll get into phase 2 in a moment. Emil Anderson built it for $62½ million — a few additional costs there. This is listed as the Yoho Bridge, which I'm assuming is the same thing as the Five Mile Bridge, not being conversant with that area. I don't live there, so I'm not totally familiar with the various names of these bridges.

That's a flat fee that Emil Anderson was paid — no additional performance payments in the future. What portion of that was federal money?

Hon. K. Falcon: We did have federal participation on that project in the amount of $21,555,689.

M. Karagianis: Then the balance of that was paid out from the province. They took the responsibility for that.

Now, Minister, you didn't actually tell me who did the second phase. I didn't hear who that contractor was.

Hon. K. Falcon: The contractor for the construction of the project was Bilfinger Berger. The maintenance contractor was HMC Services.

M. Karagianis: So HMC is now the one who is responsible for the operation and ongoing maintenance of that. Is that how that contract works? I see the minister nodding.

I see here that the minister said $143 million in costs for that. How is that divided up in the original design-and-build portion of that? Certainly, the operate will be slightly different. How was that $143 million allocated, and what portion did the federal government contribute to that?

Hon. K. Falcon: The federal contribution was $62½ million. The federal contribution was paid out based on milestone payments during the construction phase of the project to the concessionaire. The concessionaire, by the way, for the record, is called the Trans-Park group, which is the consortium that came together that includes HMC maintenance; Bilfinger Berger; a financing partner — I think it was Parsons; I forget off the top of my head.

Anyhow, the federal contribution is $62½ million. The provincial contribution, of course, we make in performance payments, based on things like lane availability, etc., over the next number of years right out till 2030-31 fiscal.

M. Karagianis: The federal contribution…. Let's go with the figure that's in here, $143 million. I realize that it is probably a bit lower than that, because there are some other ministerial costs included, but we'll keep it in round figures.

If the federal contribution was $62½ million, then the consortium here — this Trans-Park group — were the ones responsible for fronting the rest of the money for this construction. The $80 million came out of this consortium. Is that approximately how that situation works?

Hon. K. Falcon: There would be costs related to project oversight that would be the Ministry of Transportation costs. There would also be costs related to property acquisition, which would be the responsibility of the province — to deliver up the property necessary for the construction of the project.

M. Karagianis: The Trans-Park group consortium that was put together…. What were their investment

costs that they put in on this? What were the ministerial oversight costs, and what were the consortium's costs?

Hon. K. Falcon: The contractors' construction costs would make up the bulk of the $143 million. That would include the $62½ million federal contribution. Of the remaining $80-odd million there would be a small amount that would be the province's cost, which we had talked about earlier, and the balance would be the contribution of the financial partner through Trans-Park group, which would make up the difference.

M. Karagianis: So in cases like this, where the consortium here is putting up, we'll just say, roughly $80 million, understanding that we're including some of their rounded-up cost there…. One of the partners in the consortium puts this up. How is this money held, and how is this money then paid out, or do they simply hang on to it? They do all of the construction management oversight, and ministry staff are simply observers. Is that how that works? How is that $80 million overseen?

Hon. K. Falcon: What happens is that the Trans-Park group will make their contribution. That contribution will be sums split between their own equity and dollars that they borrow, whatever makes the most sense for them. They put those dollars into the project, so they utilize those dollars for the actual construction and building of these assets.

They then get that money back through a series of performance payments that the province makes. The province makes those performance payments on the basis of, obviously, construction milestones that they have to meet, quality checks that we make to ensure it's being built in accordance to the standards of the agreement and, of course, the ongoing maintenance that they're responsible for, for the entire 26-kilometre corridor. They'll get payments that are, in part, based on the kind of maintenance services they're providing and making sure that they're meeting the levels set out in the agreement.

M. Karagianis: So in the case of the $80 million, how much of that would have already been repaid back to the consortium for actually hitting those construction milestones?

Hon. K. Falcon: The fact is that from the province's point of view, we've actually started to pay back very little at this point. We've just started. We don't start making the performance payments until the completion of the project, with certainty that the project was completed as it was meant to be, which in this case, of course, it was. In fact it was completed, as I say, 18 months ahead of schedule.

We have paid thus far last year $5.5 million, and in '08-09, it looks like we will be paying $9½ million, subject to them, of course, meeting their performance requirements.

M. Karagianis: I misunderstood the minister when he said that there were payouts for making certain construction milestones. In fact, that's really just the finalization of the project. Once it's open and running, what I hear the minister saying is that's considered to be the milestone that triggers payouts, and these are expected to go out to 2031.

Will they continue to be in the magnitude of $5½ million to date, $9½ million in '08? Is that $9½ million a year from now and every year until 2031? Is that how that performance payment schedule is done?

Hon. K. Falcon: Just a slight correction on what the member said. You mostly nailed it pretty much right. The only difference is the federal portion of the payment was made during the construction phase of the project. So the $62½ million of the federal dollars were made during the construction phase.

In terms of the payments, the member is right. They're relatively small payments that go out until 2030-31. They increase slightly in the out-years. It is important to recognize that it is not just a return of capital. Operations and maintenance costs are also rolled into those payments, because of course, they're responsible for not just the building and financing but the operation and maintenance of the 26 kilometres.

M. Karagianis: Could the minister define for me the difference between operation and maintenance of a highway corridor like that?

Hon. K. Falcon: Maintenance refers to the maintenance that would be ongoing to maintain the quality of the asset. That's things like repaving, bridge repairs — that kind of work.

Operation refers to things like snow removal, sweeping, brushing to clear brush that may have gathered. It includes things like cleaning up avalanches or dealing with issues of accidents, for example, that may take place periodically on the highway. Those would come under the operation side of things.

M. Karagianis: So that means that we have virtually no concerns or responsibilities for any upkeep, maintenance or repairs to that highway until after 2031. Is that the way I see this, and does that contract end at 2031?

Hon. K. Falcon: While we certainly have concerns in that we set performance standards that we monitor and ensure that the contractor is keeping those standards up, we of course have the big stick of the performance payments. If they're not meeting the standards that we've set out, they will have the potential to be penalized in terms of the performance payments that are undertaken.

There are no additional provincial dollars that go into this. They bid for the right and the responsibility to operate and maintain this section of highway as part of the P3 concession. Our job is to monitor and make sure that we are enforcing the terms of the concession

agreement and that they are meeting the standards that are set out in that agreement.

M. Karagianis: What would happen in the case of bankruptcy or dissolution of any of the businesses in the consortium? In fact, I believe the way the minister laid this out, the consortium is actually not even the one responsible for the ongoing operation and maintenance. That would be just HMC. Perhaps you could clarify that. Then what happens if one or all of these partners either dissolve or go bankrupt?

Hon. K. Falcon: This is, I think, the best part about private-public partnerships, in my view. It's the best part because of this. The companies that are involved in these concessions are typically very large and very well financed.

For example, you've got Bilfinger Berger — one of the larger contractors in the world, which is part of the construction team — that's responsible, as you know, for building and is involved in the concession to operate and maintain this highway over the lifetime of the concession. You've also got financial partners that lend the money, the part of the money that's not the equity portion. They'll lend part of that money for the transport group that will go into this.

If the transport group…. Let's just say, in a worst-case scenario, that they all somehow went bankrupt, as unlikely as that may be. If that happened and if the lending arm — so the people that lent the money, who have a very significant financial interest in this project — then decided that they weren't going to actually take over and continue to meet the responsibilities set out in the concession agreement to operate and continue to maintain this, this could be an ideal situation for the province. What would happen is that we would actually get the asset back — the completed asset. We wouldn't have to pay out the balance of the costs, and it would be a huge benefit for the province.

That is my dream scenario, but the reality is that that's very unlikely to happen. The lender, in the event that something like that happened — recognizing that they would have financial exposure because they have dollars in these projects, which is why P3s are so significant…. There's a term we used to use in the real estate business: they have skin in the game.

Because they've got a significant amount of skin in the game, or dollars in the game, they recognize that in the event something like that took place — some kind of financial problem or bankruptcy or what have you — the lender would step up to the plate and continue to ensure that the responsibilities are being undertaken; otherwise, they would be in violation of the agreement, and there would be a reversion back to the government earlier than expected.

M. Karagianis: Any possibility of, say, a larger partner or financial stakeholder putting a lien against this and, in fact, seizing this as assets that they have invested in?

Hon. K. Falcon: The short answer is no, you can't put a lien against highways. That's a provision that's been in place for a long time, and they would not be able to do so.

M. Karagianis: So in looking at the process here as you've laid out on performance payments and working with the figures that the minister has given me, it looks like the consortium will roughly, at the end of the 2031 contractual time line, have accrued basically somewhere in excess of $230 million for their original investment.

Can the minister lay out for me how this compares in a cost analysis with a straight design-build provincially owned, operated and maintained highway system?

Hon. K. Falcon: I would encourage the member to review the Value for Money Report that was undertaken on behalf of the project. I'll read a paragraph out of the report that refers to that exact issue. What it says is: "The expected net present cost of the contract" — so net present values of the future payments that the member is talking about — "which include the design, construction, maintenance and rehabilitation over 25 years, is $166.3 million. By comparison, the Ministry of Transportation estimates the net present cost of the public sector reference project" — in other words, doing it in the traditional manner — "to be $184.4 million. The difference over the 25-year contract is $18.1 million, or 10 percent of the value of the contract."

That is the value for money that accrues to taxpayers as a result of undertaking a private-public partnership.

M. Karagianis: I know that the minister alluded the other day to being able to provide me with a chart of what these performance payments looked like out for the next 20, 30 years, and I would certainly hope that I can have that, because it would be very helpful.

Now, in the whole new kind of contractual obligations here around P3s there's lots of talk about risk and about how these projects receive a premium for absorbing risk. Could the minister, in this particular case, tell me what the risk premium is that we're paying on this project?

Hon. K. Falcon: I think the member's question is a good one. It goes to the very core of why our government has made a determination that we wish to engage projects of this magnitude, size and complexity as private-public partnerships.

There are a couple of things that are really critical to us. The first is that the groups that tend to bid for these large, complex projects tend to be companies that are involved with projects, at minimum, across North America — often around the world. They've learned lessons and developed innovations over time that they bring to bear when we have large projects, where we are saying to them that there is a fixed price. "What will you give us, in essence, for the fixed price that's available to do the work?" What we have seen over and over and over again in these projects is an enormous

The second thing that we see and that we really like is that historically, the method of procurement that the opposition prefers — I know from previous estimates and no doubt from this estimate — is the traditional government procurement process where government assumes all of the risk. They generally operate from a philosophy that since government borrows money cheaper, therefore, it's better for government to deliver projects.

The problem, of course, with that is that government often ends up paying far more than any potential savings they believe they may realize as a result of cheaper borrowing in projects that go wildly over budget and become very expensive.

To give a real-life example. If you were procuring in the '90s the fast ferries, the ideal way to have procured them would have been through a P3, where you would have said: "Here's a fixed price; here's what we expect to have delivered. We will make performance payments based on how these ferries operate, based on how many passengers they're delivering, based on their reliability and based on their performance."

That would have protected government from the open-ended financial commitment they ended up with, which …. We all know that story. So that's what we've tried to do on these P3s. And the way we determine whether there was the benefit of course is through what we call the value-for-money reports that come out.

The value-for-money reports do make the analogy between a traditional procurement and the procurement under the P3 arrangement. The value for money that is realized there, in this case representing almost 10 percent of the costs of the project or the value that is realized for the benefit of taxpayers….

M. Karagianis: Is the minister saying that the risk premium we're paying on this is 10 percent?

Hon. K. Falcon: No. What I'm saying is that the value-for-money report represents that the value for money received for taxpayers in a project like this represents approximately 10 percent of the project cost.

Of course, the benefit we get out of it is the certainty of knowing that we have transferred the majority of all the risks where government typically gets in trouble on major projects like this — the risks of construction costs, the risks of labour supply, the risks of traffic flow, of making sure that you're still moving traffic while you're doing and building and constructing the project, because you want to minimize inconvenience to the public as much as possible.

But there are enormous risks involved in a major project like this, and normally, when we negotiate a private-public partnership, there is an allocation made between what those risks are. I've spent much time in previous estimates with the former critic going over a risk allocation.

To simplify things for the member, if she gets a moment to have a look at the value-for-money report, there is actually a page 13 that will show the risk allocation between the public and the private sectors — in other words, what risks the public sector is agreeing to assume. They are typically risks that are beyond the control of a private partner to have any reasonable control over — getting permits, acquiring land, those kinds of things that you would associate with the government. Then it outlines the risks that the private sector will be assuming under the contract.

Then there are sometimes shared risks. There are some risks you cannot get perfect certainty on. There are some risks for both parties, and those are also outlined in the risk allocation.

M. Karagianis: So in fact the Kicking Horse project…. The varying discount rate on that was 6.95 percent. I thought that perhaps the minister would be able to have told me that. That was actually from the value-for-money report. It's considerably different for all the projects the government is currently engaged in. But certainly, in looking at this…. The shared risks then…. Are there shared risks in this Kicking Horse project?

M. Karagianis: Can the minister please break out here what the shared risks are and what the costs are then to the province for that?

Hon. K. Falcon: My staff reminded me of an important point. The shared risks are not risks that actually cost us anything unless they actually materialize. I want to make sure I preface my remarks with that.

Examples of shared risks would include geotechnical site conditions. For example, soil below the highway surfaces would be an example of the kind of geotechnical site conditions that would be important. That's a risk that we'll share.

Impact of delay and proceeding with the construction schedule caused by the discovery of archaeological findings during construction. Again, while they're undertaking a construction project, if they came across or stumbled across archaeological findings, that's not something that you can bear all the risk on the private partner. They have no control over that, so that's an element of shared risk.

Any changes in certain types of laws that are not characterized as discriminatory or targeted at the Trans-Park Highway Group or the contractors industry. Of course, you can't have any change in the laws of a malicious nature that would affect their financial interests without them being broadly applied. Obviously, they can't be directed to the group.

M. Karagianis: Now, if we talk about the agreement, the contract here, with the consortium…. That

goes out to 2031. Frankly, I do think $230 million or perhaps more is a reasonable return on investment, despite the value-for-money comparators. What happens in 2031? Do we then assume maintenance and operations of the highway ourselves, or do we re-contract with them?

Hon. K. Falcon: The first point the member should know is that I'm going to give her the accurate number. It's $252 million actually, not $230 million, though your estimate was close. The $250 million…. I think it's important for the member to remind herself that that includes their operation and maintenance costs over that term. So that's not a direct return. They have to, obviously, expend significant amounts.

What happens when it expires is that there are what we call turn-back conditions associated with it, meaning that we have to check and make sure that the condition of the pavement, the condition of the bridges, the condition, essentially, of the asset meets the conditions that are set out in the agreement.

As long as those conditions have all been met, then it reverts back to the province, and the province is now responsible for maintaining and looking after that highway on a go-forward basis.

M. Karagianis: When we look at the major capital projects, page 25 here, where the minister has listed the cost of these projects…. You talk about phase 3 now coming in at $134 million. Is that a realistic figure? Certainly in talking with the local community, I understand that this is probably the most complex phase of the entire project — the third phase.

Perhaps the minister can explain where this number comes from? How secure is that? What's our risk going out, seeing as it's not been tendered at this point? What's our risk of increased construction cost there?

Hon. K. Falcon: It's probably because the member is confusing what will now be a fourth phase of this project, the most expensive and most challenging portion of the project, which is the tunnelling portion. This does not include that portion.

Because of the massive size and scope of this project, it has been broken down into manageable chunks. I guess you could say that $134½ million is now considered a manageable chunk because we're undertaking such massive projects across this province. I never cease to amaze myself at some of the numbers sometimes.

The final phase, which would include the tunnelling portion, is probably what the member is referring to. That will be a future phase. There's still a lot of geotechnical work that would have to be undertaken before we even get to a point where we can start moving on that phase.

M. Karagianis: I know that the minister has talked about massive projects, but you know, we've been doing them all along in this province. I don't think these projects are any more massive than the Island Highway or any of the other bridges and highways we've built. Certainly, I think the costs are massive. There's no question whatsoever that costs are massive

The minister then talks about…. It says here that the estimate for phase 3 is $134 million. Is the minister saying that this a realistic number, or is this simply some kind of placeholder for the budget?

Hon. K. Falcon: We feel pretty comfortable with the dollars that have been put aside for this. It's based on the preliminary design work that we've done. It includes an inflation amount. It covers the section from Golden Hill to West Portal and the brake check to the Yoho National Park. So it is two very significant sections.

I think it's worth pointing out to the member that our record in government in terms of major projects like these has been, frankly, nothing short of exceptional. I don't normally like to throw out platitudes like that, but in this case with over 93 percent of our projects on time and on budget, it's certainly something that we can be proud of.

I do have to take exception to the member's comment that there were always big projects like this. That has never been more untrue than for the member opposite to say that. They weren't even in the ballpark in the 1990s, in terms of what was constructed then and what is being constructed now.

There has never been this level of capital project activity in the transportation sector in this province probably since W.A.C. Bennett, in terms of the scale and scope of the projects that are underway. That's whether it's the $600 million Sea to Sky, the $2 billion Canada line, the $144.5 million William Bennett bridge or the Kicking Horse Canyon project, which of course, when we get through all four phases, will be somewhere close to a billion dollars. That doesn't include the projects that are coming on stream — a $14 billion transit plan. It's not even day and night. It's beyond that.

I'm very proud of our record. These are huge projects — projects that I think even the member for Columbia River–Revelstoke has on occasion been heard to say are certainly appreciated by the folks in his area. I know they are because the mayor there, who, ironically enough, is a former Transportation Minister under the NDP government, has actually come out and supported us in a very significant way in recognition and appreciation of the investments that we're making that have enormous benefit for the community of Golden and, frankly, for communities up and down the Trans-Canada Highway.

This is a major commercial-goods-movement corridor. It was sadly ignored for far, far too long. There were no investments at all, unfortunately, in the 1990s or even in the 1980s. But we are pleased. We have a lot of catch-up to do, of course, because there was a big infrastructure deficit. But there's just no question. You talk to anybody in the industry today, and they will tell you that they've never seen so much activity as they are seeing right now, today, under this government.

M. Karagianis: I think that somewhere in there was a response to my question about the $134 million budget and its ability to stay on budget and on time. Now, let's be clear. The Kicking Horse project was three years late starting, so when you talk about on time, it's fairly relative.

Certainly, I know that the minister's frame of reference is always about the '90s, but in fact, when we talk about massive projects in the province, I was talking about the history of this province, not a specific decade. The fact is that all projects are massive in their time, and the dollars that they use are massive in their time and in relation to the cost of living and the value of the dollar at any given time in history. I'm not particularly overawed or stunned by the size of the Kicking Horse project or any other that the province is undertaking or planning to undertake.

But I do want to talk about the reality and the realistic cost of $134 million and how at this point if it's not tendered, how is the minister capable of guaranteeing that this will be the finite budget on this project? Certainly, then we'll discuss from there what the long-range implications are.

In fact, the minister is very good at talking about the initial cost breakdown, but it doesn't include any of the long-range performance payments, any of the risk premiums that are added on to these projects. In real terms, taxpayers…. They're looking at an enormous amount of money that may or may not be value for money after the fact, because it's always hard to tell.

Can the minister guarantee for me that phase 3, as he's outlined in here today, will come in at $134 million flat rate? That's on budget, no additional costs beyond that?

Hon. K. Falcon: First of all, I'm not sure where the member got her information but to say that it was three years late is preposterous. It's not three years late.

Hon. K. Falcon: No, it's not, Member. Actually, you're wrong. And if you go and talk to the communities…. Have you actually been there, Member? I would like to know.

Hon. K. Falcon: I would like to ask whether the member has actually been to the Kicking Horse Canyon and visited that bridge? Because if the member has, the member clearly has not talked to people that live there.

I'll tell you what the people that live there are saying. The people that live there are saying: "Thank you." Thank you to the government for actually moving on this major project. Thank you for having a Premier that actually had the commitment and said from the very beginning that this was a number one priority for the province. Thank you that we had a Premier and a government that said that we are going to work to bring federal dollars into this project, not like the previous government that could not get federal contributions for almost anything because they were blacklisted completely in Ottawa. Totally blacklisted. It was embarrassing for the province.

Hon. K. Falcon: Well, you may object, Member opposite, but you don't have the floor.

As I was saying…. The member might not like the answers. I get that the member is uncomfortable with the answers, but actually I've got the floor. When I have the floor, I'm able to answer the question, and the member is going to have to listen to it whether she wants to or not.

I know these facts are uncomfortable, but the fact of the matter is that it was our Premier that actually said to the federal government that the Kicking Horse Canyon is a priority of the province. It is our number one transportation priority. We didn't do what the previous government did, which was make promises they never delivered on. They would twin the Port Mann Bridge, which they never did. They would build a South Fraser perimeter road, like they never did. They would build a Pitt River bridge, like they never did. On and on it goes where they talked about things they would do and never delivered.

The difference is…. This goes to the very core of the member's question, because what the member is asking me is: "Minister, will phase 3 be delivered, as phase 1 was and as phase 2 was, on schedule and on budget?" What I will say to the member is yes. Don't believe what I say. Believe our record, because our record in delivering major transportation projects is exceptional.

It's totally different from the record of that opposition. The record of that opposition was, frankly, nothing short of disastrous.

So on phase 3. This is a project that, again, was not delivered three years late like the member says. It was delivered exactly as we said it would be delivered.

The member may forget that projects like this require an enormous amount of engineering work. They require an enormous amount of environmental work and work with the communities.

But I can tell you this. And if the member doesn't believe me, she should phone up her former colleague,

who is the mayor of the town of Golden, and that mayor, Mayor Doyle, will tell the member that they are thrilled with what's going on. Not only are they thrilled with what's going on, but they are thrilled with the fact that the government continues to keep its word and continues moving this major project forward, ahead of schedule and on budget, and we will continue to do so through the additional phases of this project.

Just once it would be nice to hear the members of the opposition at least acknowledge that this is a major, major project being built very successfully as a P3 — an award-winning P3, I might add — which enjoys enormous support from the communities in the areas that are benefiting from this.

M. Karagianis: Could the minister explain to me what the time line is for phase 3? I'm not going to confuse the community satisfaction with the project with its actual benefit and value to taxpayers in any way, and I'm not going to confuse fact with hubris in this case.

So let's just stick with the facts here. What is the time line for phase 3 at $134 million?

Hon. K. Falcon: Section 1 of the next phase, phase 3 of this project, will likely be tendered this summer. It is the section from the brake check to the Yoho National Park, which I had referred to earlier. It is about a seven-kilometre section, and it includes the replacement of the Mount Hunter bridge.

It is a fairly complex seven kilometres, as is of course this entire project. It tends to be characterized by the fact that it's extremely challenging terrain. It is our expectation that this is a project that will likely take two and a half years to get through to completion. We will then move on to section 2 of this phase, which is the next section, obviously, of phase 3.

M. Karagianis: This two-and-a-half-year piece of this phase. Is that the $134 million, and will there be added costs for the other portion of that phase?

Hon. K. Falcon: Sections 1 and 2 that I referred to are the $134 million of phase 3, and as I say, the section 1 of that phase 3 is likely a two-and-a-half-year buildout.

M. Karagianis: Then beyond that, the second-phase buildout, obviously, would be more than two and a half years away. How can the minister guarantee that this can be done for $134 million, two and a half years or three years from now?

Hon. K. Falcon: Because we've done fairly extensive preliminary design work, and we've also built in inflation factors, as we do in our projects. So that's number one. Number two: as I always say, rather than listen to, particularly, a politician try and tell you that something is going to be delivered in a certain way or in a certain schedule, I think it's far better to look at the record.

I think if you look at the record of this project, particularly phases 1 and 2, which by the way, are projects that the opposition opposed and questioned and were wondering — the exact same questions that I have heard in the past estimates too — whether they could be delivered on schedule, etc….

As we can see from the tremendous success of the Kicking Horse and how far ahead of schedule the concessionaire was able to deliver it, it was nothing short of remarkable — to much acclaim, by the way, in those communities, and not just in those communities but across the country and, increasingly, around the world as people are now realizing that major, major capital projects are being delivered very successfully in British Columbia as P3s.

M. Karagianis: What portion of that would you expect to be the federal contribution?

Hon. K. Falcon: I am pleased to be able to say that once again the Premier has, I think, just done an exceptional job in his relationship with the federal government. There will be $64 million of federal dollars that will be contributed towards the $134½ million.

Again, it shows the ongoing federal participation in the Kicking Horse Canyon project. Now they've been there in all three phases. We very much appreciate, by the way, the contributions that the federal government has been making to this project. They recognized that it is an important part of British Columbia's gateway — that for our gateway to be successful, we need to have the free and safe movement of goods from the rest of Canada into British Columbia, right through the Trans-Canada down to our ports, of course, which are critical economic assets for the province.

M. Karagianis: As these projects are all being done as P3s, what guarantee does the federal government demand for their contribution in each of these projects?

Hon. K. Falcon: The federal government typically makes their payments in projects like this in milestone payments. That gives them some certainty of knowing that the construction is proceeding as it was said that the construction would proceed. So they make milestone payments, in effect.

I can say that the federal government has been so impressed with the delivery of major projects like the Kicking Horse Canyon as private-public partnerships that they indeed are now requiring…. In fact, they've set up an entire group out of Ottawa, a private-public partnership secretariat. They've put together a $1.2 billion P3 fund to try and encourage more provinces, in which the federal government will be investing in projects, to actually utilize the P3, because they've been so tremendously impressed with the success of these P3s. As I say, it's just another example of the acclaim that these projects are receiving.

We get other provinces — including, believe it or not, NDP provinces — that are also very interested in the P3 delivery method. Although they're concerned about their political base and all those kind of things,

they certainly look with great envy at the major projects that are being delivered so successfully as P3s in British Columbia.

M. Karagianis: One of the things that has, of course, occurred through this process that is unusual is that the government has now got a huge climate change action plan. What are the implications on any of these projects? What portion of these projects is set aside, what percentage of moneys is set aside, to address climate change initiatives?

Hon. K. Falcon: From the beginning the primary objective when undertaking this project, very candidly, was saving lives. This was one of the most dangerous sections of highway in the province. We have had horrific accidents over the years. We're talking about a highway that was built largely in the '50s, if my memory serves me correctly. In that time, of course, we've seen dramatic population growth, and it is a critical goods-movement corridor.

What we have done as part of this project is, first of all, focus on the safety element. We are actually trying to save lives, and this project will go a long way in saving lives. One of the things that I'm most proud about with these projects is the fact that they have enormous benefits. There are literally going to be dozens and dozens of families that as a result of these improvements that have been made, will never know the horror of losing someone or of having someone critically injured. So that's number one.

Number two is that there are also significant environmental benefits, because as we design these projects, we ensure that we look at things like the grade. That's particularly important for trucks so that there's less of a drag on the trucks, less fuel and emissions as a result of the fact that we have less steep grades.

They're designed in a way that allows very wide shoulders to allow safe cycling and pedestrian use. You could not do that on the old road. The member would know, if the member has been there, that if you tried to cycle on that road, as some people unfortunately have tried to do, it can be extremely dangerous.

It is very narrow — a lot of twists and turns. You've got falling rock. You've got pretty much every element that you can imagine that would make a road unsafe, and particularly unsafe for those that are trying to do the right thing and utilize their bike or walking.

Those are huge improvements on this corridor, but I just want to be upfront in saying that the number one issue for us is safety. That is the biggest deliverable coming out of these projects, in spite of whatever other environmental benefits we might get. Though they may be significant, safety still was the number one consideration.

M. Karagianis: I heard that there was nothing in these budgets for climate change.

Can the minister answer whether or not these private partners, in the process of delivering on these projects, are required to bring in new innovations, things that may be more environmentally responsible, more environmentally friendly? I'm thinking about some of the innovations in how road construction is done. Are they required to do that, and what kind of measurement factor is used?

Hon. K. Falcon: Yes, I think, actually, that this is a great example. I'm glad that the member asked that question, because the Kicking Horse is a great example of where the private sector stepped in and said to the government: "We have a better way of doing this that will have far less environmental impact in constructing this."

This happened during phase 2. In phase 2 we were going to require two river crossings in the way that the government was thinking about doing this. The government was saying: "Well, we've got to get this phase 2 done, and there need to be two crossings of the river in order to achieve it."

The private sector proponent said, "Now, just a minute. We think that there's a more innovative way of doing this through a cantilever form of construction," which was a form of construction that was not well known in British Columbia.

They came forward with that suggestion. I give full credit to staff for recognizing the innovative element as a result of the approach that the private sector proponent recommended. As a result, a cantilever bridge was constructed, which had enormous savings in terms of environmental impact.

In addition to those kinds of innovations, though, in which the private sector is always going out of their way to try to find ways to minimize environmental impact, they are required to have an environmental management plan during the construction phase of the projects, of course. They do an exceptional job in making sure that they meet — and we, of course, ensure that they meet — the terms and conditions of their environmental management plan.

I will say this as a final point: I am very proud of the record of the Ministry of Transportation when it comes to protecting the environment. We actually have received a Platinum Award from Ducks Unlimited for the work that we've done in protecting rare habitat. We work with Ducks Unlimited to identify areas of habitat preservation. We acquire them on behalf of or with Ducks Unlimited to preserve those areas.

The protection of the environment is something that goes through every single part of my ministry, and I want to take this opportunity to recognize the work that is done within the ministry to ensure that we continue to maintain the very high standards that we have in terms of environmental protection.

M. Karagianis: What I did ask the minister about was what kind of requirements there were for innovation. He's certainly talked about finding ways to cantilever

over sensitive areas, but what other technological innovations are they going to bring?

There are improvements and changes every single day in the kind of product and technology that's used to build roads, bridges and other kinds of large infrastructure. What incentive is there for the P3 partner to bring this to the table? Are they looking to, in fact, go to the lowest common denominator for delivery of, say, paving product in order to maximize the profitability of these projects? Or are they looking to bring new innovations, and how does that impact the cost in the long run?

Hon. K. Falcon: The member no doubt would applaud…. I would hope that the member will get up to some of these major projects and see what's going on. What the member will find, particularly in the Kicking Horse…. I think it's a very good example. Of course, I've been up there many, many times meeting with the workers, meeting with the community and looking at the progress of these major projects.

What the member will see when she goes, if she gets a chance to get up there, is that they are using the latest in heavy equipment. The massive trucks that they utilize are all virtually brand-new. The private sector invests and makes sure that they have the very best. "The very best" means that they are the most fuel-efficient, the lowest emitters in terms of those kinds of heavy equipment and earthmovers that are required for projects of this size. I can tell you that I have been very impressed with what they have utilized.

The other thing that I can tell the member is that the roadbuilding industry in particular, I think, has been working very hard to try and see new technologies brought into place that will have significant environmental benefit.

Hot-in-place repaving is an example of that — a technology that was originally developed here in British Columbia. It's something that is now being utilized not just in British Columbia but around the world.

In certain projects it can be very effective for rehabilitation of existing roads at a considerable reduction in greenhouse gas emissions, a considerable reduction in fuel costs and in the fuel required, in fact, for reforming the pavement that's being reused. It essentially takes the pavement that's churned up as they go through in this thing and reuses that pavement so it can be reapplied, so significant benefits there.

We are working with the roadbuilding industry. They are looking at little things that they can do, like anti-idling measures, for example, where they're now training their crews. When they're not going to be used for some period of time — if it's ten or 15 minutes — then as opposed to sitting there and waiting with their heavy vehicles idling, they can now shut them down.

It's part of a culture shift that needs to take place. I can tell you that this is something that they continue, I think, to do a very good job of — showing leadership in doing their best to respond to the challenge that we as a government have set out.

We also do other things. There are lots of things that take place, and I'll just mention one other. We don't use lead now in the line painting that we do. That is another change that we've made as a government as we strive to find ways — as the Premier has challenged us to, in every ministry — to look at everything that we do and to determine whether or not we can somehow do it better, with less greenhouse gas emissions and with less fuel costs for the benefit of the environment. It's something that I'm very proud of.

We have within our ministry, as I hope we'll get to at some point in our estimates, a team that is dedicated to doing just that — to seeking out and identifying where we can find ways to reduce the impact of transportation on greenhouse gas emissions and the environment.

M. Karagianis: I didn't hear in there where this might affect costs in the future, but let me just put that together with the issue of progress payments. Over the next 20 years or more of the life of this project, there are bound to be increased cost burdens to the consortium that is operating this highway, whether it be through innovation, green innovation…. The minister talked earlier about shared risks around legal changes. Certainly, those may come as we see tighter and tighter regulations developed around climate change.

Does the consortium then just come back to the government and say: "Your performance payments do not meet the need any longer, and we need those to be increased"? How does the government trade off against that, or are we stuck with whatever technologies are in place right now, whatever standards are in place right now, because the P3 partner here is unable to advance us to better standards, better product and better technologies because of the constraints of the contract?

Hon. K. Falcon: I'm always glad when we get these questions. I spent a fair bit of time going through P3s in the last go-round with the former critic. I enjoyed it immensely. Frankly, I don't believe that the member opposite, the former critic, enjoyed it very immensely, because the information that kept coming out was so positive.

It was unbelievable. We went through all of the benefits involved in great detail in these projects. I have to confess that I was learning things too. When you get into the details of these contracts, it is stunning — the level of protection that's afforded to the taxpayer and the benefits involved.

This is another example of that. The member worries about: "What about technological changes or new requirements we may bring in that may impact on the industry?" Well, the member will be happy to know that this contract, as in all P3s, locks in prices. That's a risk that the proponent has to take on.

I would also say this. I think the member is being much too negative about these things. Our government looks at these as opportunities. We actually work with the roadbuilders, and we want to continue to work with them to try and find mutual ways that there are mutual benefits.

For example, hot-in-place recycling, which I referred to earlier, actually costs less than traditional

repaving. That's a benefit for the roadbuilding sector. In the cases where hot-in-place recycling makes sense, that's something that can be very, very useful for the roadbuilding industry.

We'll continue to work with them. If they can find ways to have an environmental benefit — whether it's reducing idling; whether it's acquiring more fuel-efficient vehicles; whether it's making sure that when they replace equipment, they replace it with the latest generation of heavy equipment that utilizes the latest standards — that's a benefit for them because it reduces their costs. Typically, there are significant fuel savings involved in those expenditures, and there's also a benefit in terms of reduced greenhouse gases.

These are positive things. We view them positively, and I know that the industry views them positively. No doubt the opposition critic is going to congratulate us for having locked in prices in these contracts, which allows this technological innovation to take place, with that risk, of course, being borne by the proponents.

M. Karagianis: I would say the minister seems a bit sensitive here. Questions that I'm posing are neither negative nor positive. They're simply questions.

I've heard the minister talk before, and I think he used the term in previous estimates, that the third partner kind of has to "eat it" if costs go up. That's very interesting. I would just caution the minister to be a bit suspicious about the full-on costs. If a private partner thinks that what they're getting for the next 25 years is going to cover every cost, every innovation, every change in requirements, then I would question that.

I would question the fact that there's not any kind of flexibility here built into any of these kinds of projects that says that as climate change policies toughen up…. If we put real climate change initiatives in place in the province, other than just a gas tax, we may actually be requiring much more innovative treatment of major projects in the future.

Therefore, we should not be locking ourselves in indefinitely without a critical eye on what kind of changes we ourselves as a government might be requiring, or global changes around requirements out there in the bigger world for better, safer products, safer methods — perhaps finding ways to get us out of fossil fuel automobiles altogether in the next 25 years and replace them with a better technology.

Those things could happen in a 25-to-30-year span, and I'm surprised that there's not more suspicion in government on how these contracts are put together.

Nonetheless, phase 4 is a part of the Kicking Horse project here as well. Do we have a time line on that? I know that the minister is fond of rolling out these multi-billion-dollar projects that are going to take decades and decades, so I would assume that there must be an end in sight for further phases of this, even if budgets are not attached to this. What is the time line here for the completion of this Kicking Horse Canyon project?

Hon. K. Falcon: The next phase, which would be phase 4, estimated to be in the range of $650 million, would include the tunnelling portion, which would be the predominant portion of that, and some work done in the town centre area. We anticipate that that project is probably five years out.

We'll have to get through phase 3, of course. Phase 3 is seven kilometres of — again, as usual in this section — some challenging kilometres in terms of the work that's going to be done as part of the $134½ million phase 3 portion.

We will, in phase 4, also be working to bring federal dollars to the table. Based on our success in the first three phases, I anticipate that we will enjoy the same success on phase 4, given our record. So that's the likely time frame that we're looking at.

M. Karagianis: With the consortium here that's involved, is there an expectation for them that their maintenance contract would be expanded to include all of this? Or are these various phases going to be operated and maintained by, perhaps, numerous companies?

Hon. K. Falcon: The maintenance contract already covers the entire length of the corridor — just over 26 kilometres. It will continue to cover it. As the improvements get made, they continue to maintain the sections.

M. Karagianis: That does actually trigger a new question here. Is this performance payment here of $9½ million for '08…? That is for this consortium to operate and maintain sections of this Kicking Horse Canyon project that have not yet been completed? Is that what I'm hearing?

Hon. K. Falcon: Yes, they maintain it in its current state and, of course, in its improved state.

M. Karagianis: And that contract is available to look at, to peruse, on the scope of what the operations and maintenance are on this?

M. Karagianis: When the phase 3, in its two parts, and phase four are done, will the performance payments then grow exponentially to cover those?

Hon. K. Falcon: Okay, I'm not sure if the member is getting confused and thinking that the concessionaire is also are responsible for building the future phases. The future phases will go through a competitive tendering process. Whoever successfully wins that competitive process will be responsible for building those add-on sections.

The thing that the member needs to know about the operation and maintenance provisions of the concession agreement is that the concessionaire is responsible for the entire 26 kilometres. That's both the improved and the unimproved sections. As the sections improve, they're responsible for maintaining them.

M. Karagianis: Then are the next phases, the two parts of phase 3 and phase 4, strictly design-build?

Hon. K. Falcon: We went through this earlier. The member may recall that I talked about…. We hadn't yet identified what procurement method was going to be utilized. Right now what we're looking at in phase 3 is whether it makes sense to break them down into more manageable bits. That's part of the work that's still underway. At that point we'll be able to better determine what the best procurement method is.

Again, when we make decisions on procurement method, we decide what's in the best interests of taxpayer and project delivery. There are a number of factors that go into that. It just totally depends on the specific project.

M. Karagianis: If I understand how this has been laid out, then, there are probably only a couple of options here for the next phases. Either it's design-build, or the province takes over and builds it themselves. Is that what the minister is saying here?

Certainly, there is no option for a design-build-operate in the next two phases because the concessionaire is already taking care of the operation and maintenance part of that, for which they are receiving pretty handsome progress payments.

Hon. K. Falcon: The options available, of course, to government would be design-build and design-bid-build. Those would be the two likely options.

M. Karagianis: I would then, perhaps, like to just move on to another one of the large capital projects here, which is the William Bennett bridge. I do have some questions specific to that. Some of them, of course, will have been influenced by the answers coming out of the previous project question.

Let me just ask the minister…. I know that originally the William Bennett bridge…. At the decision point in this project, the budget was at $100 million. I see now that the minister has got this listed here at an estimated cost of $185 million. That's considerably higher than the decision-point budget.

Hon. K. Falcon: Yes. The member will recall that at the time we announced this project in June '05, I had said very openly that back in 2003, before any preliminary drawings were done — before, frankly, any significant work was done on the project — there was a high-level estimate made of $100 million. I think the lesson learned there is that you should not put out a high-level estimate until you've done at least some preliminary work on the project in terms of preliminary design work.

It was just a ballpark figure in June 2005 when we actually announced that we were going ahead with the bridge. We then came forward with a capital cost of $144½ million. The member can refer to the announcement and the press release. It's all laid out.

I'm really pleased to say — I would encourage the member; I don't know if the member has had a chance to go up and view that project — that this is only one of, I believe, nine floating bridges in the world. This is about as complex as you can get in terms of engineering challenges. But this project is being delivered extraordinarily successfully, on schedule and on budget once again, by the SNC-Lavalin private-sector proponent.

The member should be careful not to confuse the capital costs with the $185 million that is referred to in the budget. This is an accounting issue. This refers to interest during construction that they allocate to capital costs for accounting purposes. It does not change the total cost of the project — in no way at all. In fact, the capital costs of the project remains exactly the same at $144½ million. That answers….

M. Karagianis: Perhaps the minister could just explain to me the difference between a high-level budget and…. There are a few others of these that have similar outcomes. That was a decision-making budget. In fact, when the minister says, "We're on time, on budget," he's not including the original decision-point budget. That $100 million was the budget by which a decision was made that we were going to move forward. Now that….

M. Karagianis: Perhaps I will let the minister answer that rather than just yelling it out.

Hon. K. Falcon: No, I do want to correct that. There was a political commitment that we wanted to build the bridge in 2003, but it actually wasn't until 2005 that we entered into a contract, as government, to build the bridge with SNC Lavalin. Obviously, it's kind of like saying: "I want to buy that house over there in a couple of years, I think that the house is about $100 million."

Of course, two years later when we get to where we can actually sign a contract, we have a far better idea of what the costs are. We've done some of the preliminary drawings. We've gone through a tendering process. I think the only unusual feature about the intervening two years there was the fact that there had been a massive run-up — I think about 50 percent — in steel and probably the equivalent increase in concrete costs over that period. Of course, a bridge is primarily made up of steel and concrete.

Nevertheless, I was very upfront about it at the time I made the announcement that this isn't an increase in the cost of the project — I don't want the member to confuse that for a second — because we had no project. We had a project when we announced a project and signed a contract in 2005 with SNC Lavalin.

M. Karagianis: From the time that the political commitment was made to the time that the contract was actually signed, why was there a two-year delay?

Hon. K. Falcon: That was to do with the preliminary engineering and design work that I talked about that's necessary in a project like this. As you go to the tendering process, you've got to have something, obviously, that's going to demonstrate what you're planning on building. I'd include some initial public consultation.

Naturally, you're going to want to talk to the communities — particularly Westbank, the local first nation and, of course, Kelowna — as you think about going to sign a contract on a bridge like this. So that's what happened during the intervening period.

M. Karagianis: Can the minister explain what the status of that bridge project is today?

Hon. K. Falcon: Yes. In fact, there was another significant milestone event just last week, I believe it was, where the final pylon was floated into the bridge. That bridge is now likely to open ahead of schedule. It's currently ahead of schedule and on budget.

That is, by the way, in spite of the fact that we as the government caused a significant delay as a result of…. When they were building the graving dock, which was responsible for building the actual floating sections of concrete, they came across an archaeological dig. We as government delayed that project for a number of months in order to — appropriately, of course — go through working with local first nations and identifying the nature of the archaeological remnants that were discovered there.

In spite of that, the contractor…. I think it's another example of the private sector delivering in the most spectacular fashion in a project that is very large, very complex. They have done an exceptional job, and I really…. Again, this is one that we're so very proud of as government.

If you go up into those communities and talk to the people, they are incredibly excited about this bridge which is, as I say, going to open ahead of schedule and on budget. We're just really excited to be there with the community when we open up this very significant piece of infrastructure for the interior.

M. Karagianis: So SNC Lavalin is the design-build operator of this. What are the performance payments on this, and is the life of this contract 30 years?

Hon. K. Falcon: The performance payments on this bridge, of course, would begin, as is always the case in these projects, once the bridge is open and operational and traffic starts moving across the bridge, which I am pleased to say will be happening this year.

Performance payments will start this year and will continue till 2035-36. The total amount of payments over that period — and of course, that includes the usual operation and maintenance, etc. — is $586 million.

M. Karagianis: Can the minister elaborate on exactly what the nature of the operations will be there? I see that the bridge is expected to have a 75-year life in it. What kind of operations is SNC Lavalin being paid for?

Hon. K. Falcon: In this case, the concessionaire is going to be responsible for maintenance of the bridge and the surface — obviously, the road and the bridge. In fact, they cover the road on the Westbank side up to Westside Road and on the Kelowna side up to Gordon Avenue, so they're responsible for that entire section.

That's going to include the kinds of things we talked about earlier, with some changes or deviations, of course, because there's a huge bridge here. They're going to have the typical road maintenance and snow removal and the kinds of things that you would expect — the sweeping and salting and plowing and all the things that go on with respect to road maintenance.

They've also got to maintain the bridge structure in particular. So they've got to do cable adjustments. All the pontoons have hatches. They’ve got to get into the pontoons. They've got to inspect the quality of the concrete. They've got to make sure that it's up to the standards that are set out as part of the concession agreement. So there are the pontoon inspections. There are any repairs that have to be made, any adjustments that have to be made, and steel inspections.

As is typical with our P3s, we have the turn-back provisions that I talked about earlier, meaning that when we get to the end of the concession agreement, and it's turned back to the province of British Columbia, it will have to meet the standards that are set out. If it doesn't meet the standards, of course, there are financial deductions that are made from the performance payments.

Again, what we have here, I think, is really significant, because we've got an asset that's built for the benefit of the province, where we make payments based on performance, where we are protected and where we get a project with a heavy risk associated, especially in terms of construction.

I can tell you that it's been a challenge for SNC Lavalin in terms of workers because the interior, of course, as in so many parts of the province under our government, is booming in terms of the economy. There are lots of alternative jobs available for skilled workers that are required to work on a project like this. But they've been very innovative — again, extremely innovative — in how they're keeping the contractors working here.

I know that when I was up there last time, they were having, for example, special draws where you could win a ski boat, and if you worked a certain period of

time you were eligible for the draw, so people that had been there for more than six months were eligible to go into a draw to win the ski boat — just outstanding ideas, very innovative, as usual, and really smart in terms of keeping good skilled workers. They've done an exceptional job in delivering this project ahead of schedule.

M. Karagianis: The $144 million budget. The bridge is not open yet. Is that a fixed cost regardless of what cost SNC Lavalin has undergone? They're simply eating any additional costs here?

Hon. K. Falcon: Yes, that is the case. Of course, one of the things we try to build into these contracts is, also, incentives. We want incentives to open it up earlier. Again, that is just a wonderful thing, because we want them to try to go above and beyond what is set out in the schedule. And it looks like, in this case, the proponent is going to be successful in delivering this project ahead of schedule.

Hon. K. Falcon: The shared risks on the project. One was the graving dock, which…. It's funny. You know, every time I say that I think of a little fishing dock. This is a massive dock that I would encourage the member opposite to go and visit. It is extraordinary to see the size and scale of this.

But the graving dock. So MOT provided the site to SNC, and SNC is responsible for designing, constructing and deconstructing the graving dock site in complying with all of the required permits. As I say, it is a massive concrete structure they built out into the water there, which they then utilized for the benefit of the public that may be watching. The graving dock is the facility they utilize to actually construct the floating pontoons that were used to construct the bridge.

Another example is permitting. For example, permits that are not received in a timely manner or permit requirements that result in higher costs are the kinds of things that the contractor doesn't have total control over, and we, as government, often do, so we share the risk in that. Force majeure — and the member knows what force majeure is.

What else? Performance payments during the operations phase, of course, are indexed to inflation, so there's an inflation allowance recognizing the inflation risk as you go forward, and that is something that is a shared risk.

M. Karagianis: I would ask the minister to not be too condescending about graving docks. Esquimalt has one of the best graving docks in the country and does major work. I'm very familiar with that….

M. Karagianis: I believe that the minister's comments were directed…. "If the member doesn't know what a graving dock is…."

However, what was our actual cost, then, for all these shared risks? What was the cost to us?

Hon. K. Falcon: The member ought not to be so prickly about suggesting condensation. The fact of the matter is that I was trying to….

The member should not refer to things like being condescending when, in fact, I wanted to make sure that the public was aware. I didn't know what a graving dock was, frankly, going into this. I don't have any hesitation in saying that. I had never heard of a graving dock, so I'm glad that the member was familiar with that, but I know there's probably a lot of the public out there that is wondering what the heck I'm talking about. I'm happy to allow the public that.

In terms of the costs, the one thing I can refer to is the archaeological delay, obviously. There are costs associated with that. I don't have those costs at my fingertips, but there were delays that resulted from government halting the project as a result of the archaeological remnants, first nations remnants, that were discovered at the site.

M. Karagianis: I would appreciate those costs and itemized breakdown of exactly what those costs were outlaid for.

Now, I have a question here about the risk transfer premium. I see that the William Bennett bridge…. The risk transfer premium we paid there was 8 percent, versus the 6.95 percent we paid on the Kicking Horse. Can the minister explain why we are paying different rates for this kind of risk transfer?

Hon. K. Falcon: The member, I think, is confusing the discount rate with what she is referring to as a risk rate. She's actually referring to the discount rate of 8 percent that was utilized on this particular P3. I'd encourage the member to review previous Hansard. Myself and the former critic have extensively covered this. It's one of my favourite topics, actually, but it's based on the weighted average cost of capital that's utilized, and the rate will depend…. That's why it's different on different projects. It will reflect the risk associated with a particular project.

When investors are making a decision to invest in a particular project, the return they will require will be based and predicated on the risk profile of the project. I don't need to tell the member that a floating bridge, given that there are so few of them anywhere in the

world, is probably very much on the higher end of the risk element. Typically, what happens when determining the discount rate is that they use a weighted average cost of capital — in this case 8 percent.

I think it's worth pointing out — since the member is referring to, in fact, the value-for-money report where it talks about the discount rate — that there are, over the 30-year life of this partnership agreement…. The value-for-money report demonstrates a $25 million benefit to the public and to the taxpayer, compared to a conventional government-delivered project.

M. Karagianis: I did make note of that in the service plan report. But what I did hear the minister say is that this discounted rate is about risk transfer, so in fact it's not incorrect to call it a risk transfer premium. But you know, we're paying double what they are in the U.K. I'm sure that the minister canvassed this with the previous critic. Bear with me, I think I deserve answers that are current as well. So we are paying…. Now, who sets that rate? Is that set by your third partner here, SNC Lavalin? Is that who sets this rate?

Hon. K. Falcon: First of all, when the member refers to the European rate, typically she would be referring to what is called the Green Book rate in the U.K.

As I've pointed out in the past to the former critic, I'll say to the member: it's important to reflect that that is a stripped-down rate. That doesn't include the risk premium that would also have to be added on — inflation factors, for example, that would have to be added on. So you're comparing apples and oranges when you try to say it's half the rate. That would be number one.

Number two is that the Ministry of Transportation will utilize business advisers to determine what the appropriate discount rate to be utilized is in a project like this. They will typically look at what a private sector proponent would require in terms of a return if they were able to use the same amount of dollars to be invested in similar projects of similar scope and risk.

The other thing that will determine the discount rate is the allocation between equity and debt that any potential bidder may be utilizing. That will also have an impact on what the discount rate is.

M. Karagianis: Again I heard the minister refer to a risk premium here and that that is responsible for the differential between what we're seeing in the U.K. rate. You know, I would question this issue of equity. I mean, the private partner holds no equity. Their equity is performance payments over 30 years, and then they divest their equity to the province.

Perhaps the minister could explain how they use equity, when in fact the equity remains…. I think the minister was very clear that even in the case of default, the equity remains in the hands of the province.

Hon. K. Falcon: I think the explanation I can give the member is, really, a definition of equity. Equity is what the partner is putting into the project, what the private sector proponents are putting into the actual project. It is typically a significant amount of money. You know, I referred to it earlier on, colloquially, as the skin in the game, so to speak. Those are the dollars that the private proponent is putting into these projects. I think that might help the member when she thinks about these issues.

Now, noting the time, I move that we do now rise and report progress and ask for leave to sit again.

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	YEAS — 25

Brar	S. Simpson	Fleming
Farnworth	James	Kwan
Ralston	Cubberley	Hammell
Thorne	Puchmayr	Gentner
Routley	Fraser	Horgan
Dix	Robertson	Karagianis
Krog	Austin	Chudnovsky
Chouhan	Sather	Macdonald
	Conroy

	NAYS — 37

Falcon	Reid	Coell
Ilich	Chong	Christensen
Les	Richmond	Bell
Krueger	van Dongen	Roddick
Hayer	Lee	Jarvis
Nuraney	Cantelon	Thorpe
Hagen	Oppal	de Jong
Bond	Hansen	Abbott
Neufeld	Coleman	Hogg
Sultan	Mayencourt	Polak
Hawes	Yap	Bloy
MacKay	Black	McIntyre
	Rustad